Wednesday, June 12, 2024

Egypt sells Ras al-Hikma peninsula to UAE for $150 billion investment to aid economy

Ras al-Hikma peninsula, located west of Alexandria and northwest of Cairo, will be transformed into a mega resort with an in-built airport.

• February 24, 2024
An aerial view of a luxury hotel complex in Sharm el-Sheikh
An aerial view of a luxury hotel complex in Sharm el-Sheikh [Credit; Alarabiya News]

The Egyptian government has finalised the sale of Ras al-Hikma peninsula at $150 billion to the United Arab Emirates as a crucial investment strategy to revive the nation’s flagging economy.

Egypt’s Prime Minister Mostafa Madbouly announced on Friday that the UAE will be investing billions of dollars into the Egyptian economy through the project, with a $35 billion first tranche to be received over the next two months. 

Ras al-Hikma peninsula, located west of Alexandria and northwest of Cairo, will be transformed into a mega resort with an in-built airport that the Emirati authorities will control. The peninsula already boasts of beautiful white sandy beaches with blue waters, which boosted its chances of bagging the investment.

Mr Madbouly explained that the investment would go a long way in “resolving” the economic challenges that have befallen Egypt, which has witnessed its currency, the Egyptian pound, free fall rapidly against the dollar in recent weeks, resulting in galloping inflation.

According to the prime minister, the peninsula sale will close the wide gap between official and parallel exchange rates, costing the nation dire economic repercussions that include currency crunch, making it difficult to service its enormous foreign debt.

$24 billion of the intended $35 billion would be used to develop the resort while the remaining $11 billion would be deposited for “prime projects across Egypt to support its economic growth and development,” Albariya newspaper quoted a press release by the prime minister as saying.

Nigeria, battling a similar economic crisis, could take a leaf from its Egyptian counterpart to attract investment to bolster economic growth.

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