The first Chinese economic zone, out of the five proposed in Africa, is likely to be established in Egypt, which will contribute to the growth of Chinese investment in that country, said a top Egyptian investment promoter.

 

Assem Ragab, chairman of the General Authority of Investment and Free Zones (GAFI) of Egypt, said as the trade between the two countries is expected to triple to $10 billion by 2010, investment of Chinese companies in Egypt can grow at a similar pace.

 

In the first nine months of this year, the trade volume between the two stood at $3.33 billion, according to the Ministry of Commerce.

 

"China is a key market for us and we have big plans here," said Ragab in Beijing yesterday.

 

He said there are almost 300 Chinese investors in Egypt, with a total investment of $300 million. But most of them are private firms with smaller scales in low value-added industries like textiles and shoe making, and that Egypt now wants to attract big investors from hi-tech industries.

 

He said there will be a Chinese segment in the special economic zone (SEZ) in Northwest Gulf of Suez, the first SEZ in the country. The segment will cover 20 sq km. "We hope this can be the first of the five economic zones that China will have in Africa."

 

Shanghai Construction Group has won the bid to build an administrative and service center, which will be backed by grants from China.

 

Ragab said GAFI is also in advanced talks with a Chinese developer on the economic zone, which will help take Chinese investors to Egypt, but he declined to reveal the name of the developer.

 

He expressed hopes that Chinese investors would go to Egypt in clusters, which will be beneficial for both Chinese companies and Egypt as it will provide a complete supply chain.

 

These industries include infrastructure, logistics, electronics, communication and information technology, construction, textiles, car components and chemicals.

 

GAFI hopes to attract more than 100 Chinese investors and $100 million to the economic zones at the initial stage.

 

In the past years, Egypt has launched significant reforms to recharge its economy and attract foreign investors, while Chinese companies, anxious to enter the African market, also see Egypt as a key bridgehead.

 

(China Daily November 14, 2007)