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Al-Ahram Weekly 7 - 13 September 2000 Issue No. 498 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 7 - 13 September 2000 Issue No. 498
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Features Travel Living Sports Profile People Time Out Chronicles Cartoons Letters Airports await more private investments
By Sherine NasrTHE PRIVATE sector will increasingly turn to building airports, under the Build, Operate and Transfer (BOT) system, over the next three years . Many of Egypt's outlying areas will be linked to the country's cities -- and those of the world -- by these airports for which the government is offering incentives to investors. These incentives will be in the form of lucrative concessions for other projects in the areas served by the airports, contracts for these facilities are an integral part of programmes to develop various parts of the country.
The BOT system for airports was introduced in Egypt only two years ago when the contract for an airport at Marsa Alam was awarded to the Kuwaiti Group, Al-Kharafi. This airport is expected to be operational by the end of this year. Under the same contracting system other airports are now being constructed in the oases of the Western Desert, at El-Alamein on the northern coast and near tourist areas along the Red Sea. The government is expected to seek tenders for BOT airports in Sohag, Ain Sukhna, Borg El-Arab and Assiut.
For some areas slated to have airports, benefits have accrued to their inhabitants even before the facilities are operational. This is the case in the sparsely inhabited El-Farafrah and El-Bahariyya oases where airports are scheduled to be completed during the next two years. Captain Hamdi Abdel-Azim, head of the Central Administration for the Airports Sector, explained some of the work done in the area before construction began. "We worked closely with the governorate of the New Valley to solve problems related to poor electricity and telephone services. Fortunately, we have resolved the difficulties," Abdel-Azim said.
The BOT system is being pursued by the government with the aim of obtaining the most modern facilities while at the same time developing specific areas of the country. "The system allows more development to take place in strategic regions. Great potential has been hampered by scarce funding," he said.
Key to the selection of contractors for such projects is their demonstrated ability to build such facilities and engage in other development projects. An investor, if not enticed by the potential profits from an airport, may be attracted by the more lucrative concessions for projects such as land reclamation, food processing and educational enterprises.
By agreeing to contract for such projects, the companies gain rights over them for as long as 95 years. For example, the contracts for the airports in El-Bahariyya and El-Farafrah were awarded to the German company ABB, one of the world's largest in the field of electricity. ABB will enjoy a 50-year concession, which includes an option to extend the contract for another 45 years. Ultimately, however, the airports along with the other projects will be handed over to the government.
Abdel-Azim explained that ABB was awarded the El-Farafrah and El-Bahariyya contracts due to its agreement to build a university and expand tourist-related infrastructure by building hotels, restaurants and recreation services. "By so doing, we guarantee faster and more comprehensive regional development, more job opportunities as well as more income," he said.
"The recent contract to upgrade the airport east of Oweinat [another oasis in the Western Desert] was awarded to the Australian Middle East Group Limited because it will not only increase the capacity of the airport, but it will also engage in a number of agricultural projects to maximise its regional investment," said Abdel-Azim. The company was contracted to reclaim 100,000 feddans east of Toshka to breed cattle. It will also construct two major projects for vegetable and meat canning, explained Abdel-Azim.
The airport east of Oweinat is not the only one scheduled for upgrading using the BOT development strategy. Airports in Hurghada, Sharm El-Sheikh and Luxor are currently being upgraded under the same system. "The target date [for completion of work] is 2050. The initial plan is to increase the capacity of these airports from 1,200 to 4,000 passengers per hour," Abdel-Azim said.
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Emancipating EgyptAir? 28 Oct. - 3 Nov. 1999
