Monday,11 December, 2017
Current issue | Issue 1284, (25 February - 2 March 2016))
Monday,11 December, 2017
Issue 1284, (25 February - 2 March 2016))

Ahram Weekly

A golden opportunity

The Golden Triangle Project has the potential to become a model for development across Egypt, the head of the technical committee tells Niveen Wahish

Economy
Economy
Al-Ahram Weekly

Egyptians will be hearing a lot about the Golden Triangle Development Project (GTDP) in 2016. Extending over an area of 6,000 square km, the GTDP is one of the mega-projects the government is betting on to boost economic growth. It covers the area between Safaga and Al-Qoseir overlooking the Red Sea, to Qena and Qeft in Upper Egypt.

At the moment, the finishing touches to the project’s master plan are being made, Galal Soliman, head of the technical committee overseeing the project, told Al-Ahram Weekly. The technical committee includes 26 representatives from the various ministries and authorities concerned.

The final draft of the master plan is expected to be presented to the cabinet towards the end of March, he said. The development of the master plan is being led by D’Appolonia, an Italian consulting firm. A one million Kuwaiti dinar ($3.3 million) grant from the Kuwait Fund for Arab Economic Development covered the cost of the master plan.

The Italian company won the bid to draw up the master plan in March 2015, but work only began in May after the contractual process was finished. While the development of the master plan was scheduled to take nine months, it has taken slightly longer than that, Soliman said, because extra studies were needed to give a more accurate estimate of the area’s mineral wealth.

It was important to wait for proper data to ensure that outputs were accurate, Soliman explained, because mineral wealth is the driving resource for the project. He added that the resources will not be extracted and exported in raw form; instead, industries will be established.

While mining will be the cornerstone of the project, the master plan also integrates agricultural and touristic activities. The full development of the project is expected to take 30 years, the first phase covering the initial five years. The focus then will be on minerals that have the most potential and those that can be quickly utilised, he said, among them phosphates for the fertiliser industry, limestone for the cement industry, and marble, granite and magnesium, which are available in quantities attractive to investors.

“We chose materials that will get the project going quickly,” Soliman said, adding that others may come online at a later stage. Investment in the extraction of metals such as gold, the reserves of which are believed to be attractive, could start during the initial phase, but it would need ten years before production could start.

Work on the tourism and agricultural aspects of the project will also start right away. The 80-km coastline between Safaga and Al-Qoseir will be developed for tourism. To differentiate the area from Hurghada and Marsa Alam further to the south, new tourist resorts in the area will be larger and will allow for greater privacy.

The tourism in the area will also not only be about beaches, but will include sites within the mountains that can be used for tourism development. These include the abandoned Italian phosphate factory in Al-Qoseir that dates back to the early 1900s, and the churches, monasteries and traditional houses that can be turned into places of interest for visitors.

Agricultural activities will be in the area closest to the Nile east of Qena and alongside an integrated community where schools, hospitals and the South Valley University are located.

Water will be a challenge. Said Soliman, “While there is groundwater, there is not enough of it to irrigate the land using the old techniques, meaning that modern irrigation systems need to be used.” He said that the irrigation systems used would introduce water straight to the roots of plants to ensure maximum water efficiency.

The agricultural aspect of the project is not part of the main 1.5 million-feddan project, he said. Soliman said that the land will not be used for water-consuming crops but mainly crops that can be processed and exported, such as medicinal herbs, which use very little water. “This is virgin land, and the climate is ideal for these types of crops,” he said.

While groundwater will be used for agriculture, “on the coast we can have desalination plants for tourist projects and some industries,” he added.

During the months when the master plan was in the making, meetings were held with main stakeholders and the local community. According to Soliman, local farmers expressed their readiness to change their irrigation techniques to better conserve water.

The agricultural activities will be carried out by large, medium and small farmers. The larger farmers will be in charge of implementing the irrigation systems used on smaller plots because the owners of the latter might not be able to afford the investment, Soliman said, adding that the larger farmers could also help market the crops of smaller ones.

The overall aim of the project is to help create jobs for the people of the region, with current data showing that 50,000 people emigrate from Upper Egypt annually towards Cairo looking for jobs. “We want to reverse this. We want these people to return home and make this area an attractive place for others,” Soliman said.

However, the project is not just about creating jobs. It is estimated that it will create around 400,000 jobs over its lifespan, which is not enough given that Egypt needs over 500,000 jobs annually to solve its unemployment problems. According to Soliman, the project is also about creating sustainable, socially responsible economic development and about attracting investment and increasing exports.

The environment is an important aspect of the project, Soliman said, explaining that tough environmental measures will be implemented, especially as the project is located on green-field areas where environmental standards need to be part of every step of the process. It is important to ensure that mining and industrial activities do not affect the tourist coast or the agricultural and residential areas, he said.

Soliman said that, initially, 20 per cent of the project’s energy needs will be covered by solar energy and the remainder by two coal-fired power plants that are part of the government’s expansion plans for the electricity grid. However, he added that the project will be 100 per cent solar-powered by 2030.

“The area has the advantage of year-round sun and long exposure to the sun’s rays,” Soliman said. It also has the sand needed to manufacture solar cells, so factories could be set up to service the clean-energy industry.

Soliman stressed the need to set up an independent authority to manage the GTDP, as is the case with the Suez Canal Area Development Project. The authority should be in charge of all licences and agreements within the specified zone, thus bypassing bureaucratic procedures, he said.

The authority would also enable the project to overcome any glitches that exist in the current investment laws. It would be the “father” of the project, he said, with several development companies coming under the umbrella of the authority to oversee the development of utilities, transportation and tourism.

Soliman added that he hopes D’Appolonia will continue to work on the project during the implementation phase, but this is not yet certain. He suggested that the company be brought in as a consultant, as was the case for the company that carried out the master plan for the Suez Canal Area Development Project.

As for the new mining law and its effects on attracting investors, Soliman said that while the new law might be difficult for existing investors, this will not be the case for new investors who will base their future feasibility studies on it.

Experts have warned that the royalties stipulated in the new law to be collected by the Egyptian Mineral Resources Authority could discourage investors, especially in the light of the globally dwindling prices of commodities.

The project’s master plan also includes preliminary feasibility studies on activities to be undertaken as part of the first phase. “Investors can take these and expand on them,” Soliman said.

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