The construction of the $8 billion desalination project in Egypt is taking shape as the government has finalized land locations. Egypt plans to award deals to build 21 water desalination plants in the project’s first phase. Approximated at $3 billion, the first phase will also draw on cheap renewable energy. Egypt depends almost entirely on the Nile for fresh water and faces rising water scarcity for its population of 104 million. The desalination program aims to generate 3.3 million cubic meters of water daily in the first phase.
Eventually, the projects seek to reach 8.8 million cubic meters daily at $8 billion. Once completed, the desalination plants will be some of the largest in Africa, with the current one producing 450,000 cubic meters daily. Since its announcement, more than 200 developers from at least 35 countries have been interested in the first phase. The finalization of land moves the construction of the desalination plants closer to completion.
The Significance of the Desalination Project in Egypt
Upon completion, the desalination project in Egypt is expected to be highly significant for Egypt as a nation. One of the major benefits is the assurance of water security, which is currently under threat. As noted, Egypt depends solely on the Nile for its water source, an aspect that many aspects have previously threatened. Factors such as the construction of Africa’s largest hydroelectric dam on the Nile significantly threaten Egypt’s water security. Furthermore, the project will ensure the production of renewable energy sources, which the government seeks to leverage. Egypt, which recently hosted the COP27 U.N. climate talks, is trying to boost lagging investment in renewables. Moreover, the country aims to start production at a series of proposed green hydrogen projects in 2025-2026. The desalination project provides the groundwork that will ensure the achievement and fulfillment of these projects.
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The State of Affairs Regarding the Project
The state of affairs regarding Egypt’s desalination project seems to raise concerns over its implementation. As reported by MEED, currency concerns have plagued some of Egypt’s PPP projects. It is a major concern as the Egyptian government seeks to leverage private-public partnerships to fund its desalination project. This is after the Sovereign Fund was set up in 2018 to attract private investment in state-owned assets through partnerships and co-investments. Furthermore, it is focused on getting private consortia to develop infrastructure and private equity to develop state-owned enterprises ahead of public listings. The CEO of the Sovereign fund, Ayman Soliman, said, “We as a fund are very sharply focused on trying to find those champions to scale up, be it in agriculture, be it in tourism, be it in infrastructure, or be it in banking financial services.”
Other Significant Projects Currently Ongoing in Egypt
Apart from the mega desalination project in Egypt, the country has other significant projects in its pipeline. One of them is the construction of the Cairo Airport City. Plans for the long-awaited Cairo Airport City (CAC) have steadily progressed since its unveiling in March 2015. Built around the Cairo International Airport, the city comprises logistics and retail areas. It also includes recreational developments worth $13bn of investment over 25 years. Aerocity, the first project to be launched as part of CAC, will be the development’s commercial and leisure heart. Stretched over 2.8 million square meters, it will be developed in two phases. Phase 1 includes a 62,000 sq m mall and a 30,000 sq m office park, and phase 2 will include the development of entertainment areas.
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