Egypt mulls shares sale to fund high-speed rail
Cairo, October 26, 2013
The Egyptian government is considering selling shares to the public to help finance a high-speed passenger rail project extending up the Nile valley, al-Mal newspaper quoted the transport minister as saying.
The railway would run from Alexandria on the Mediterranean coast to Cairo and then to the tourist centre of Luxor in the far south, a distance of 800 km, minister Ibrahim El-Demiri told the financial daily.
A further line would later run to tourist towns on the Red Sea in a project that would eventually cost a total 70 billion Egyptian pounds ($10 billion).
Demiri gave no timeframe for the project, which could eventually boost a tourist sector battered by nearly three years of unrest, with the toppling of Hosni Mubarak after almost 30 years in power and the ouster of Islamist Mohamed Mursi.
The government is looking at labour-intensive projects that would create jobs after the turmoil that has pushed many Egyptians deeper into poverty.
Egypt is seeking budgetary support from Saudi Arabia, Kuwait and the United Arab Emirates in addition to the $12 billion pledged since Mursi was ousted by the army on July 3 following nationwide protests a year after he was elected.
This week the government said it was increasing an economic stimulus package for the financial year to June 2014 to 29.6 billion Egyptian pounds ($4.3 billion) from the initial 22.3 billion pounds announced in August. Officials have said that another stimulus package could be announced early next year.
Some of the new cash will be directed to building railways, roads, bridges as well as to an extension of the Cairo metro and other improvements to the city's transport network.
Egypt has been mooting a high-speed rail project to link Alexandria with Cairo since at least 2009. The train between Egypt's two biggest cities currently takes about two hours.
The new railway would eventually transport around 4 million tourists annually, al-Mal said. Tourism had gradually been recovering before a renewed bout of political violence in the weeks after Mursi was ousted.
The number of tourists visiting Egypt fell from 14.5 million in 2010 to 9.8 million in 2011 and 11.5 million in 2012.
The Transport Ministry has set up a legal committee to study the rail project, Demiri told al-Mal.
The government would seek to find the funds for the project "as soon as possible", al-Mal cited him as saying, adding that a portion of the funding would be from the public offering.
The army said it had sought to provide some of the funds for the project, al-Mal said, adding that the Transport Ministry and state banks would also contribute.
The Transport Ministry could not be immediately reached for comment.-Reuters