UAE Strengthens Its Influence Over Egypt's Maritime Industry

Egypt has recently struck several agreements with AD Ports and DP World, effectively placing the management and revenue streams of its key ports and maritime logistics under Emirati control for the foreseeable future. In exchange, these companies are making notable upfront investments.

The latest arrangement involves a 50-year contract between Abu Dhabi Ports Group and Egypt for the East Port Said industrial zone at the suez Canal’s northern end.This deal allows AD Ports to construct and manage a new terminal dedicated to shipping and cruise liners.previously, they secured a 30-year deal for a multi-purpose port in Safaga along Egypt’s Red Sea coast, as well as a 15-year agreement for cement terminals in West Port Said and El Arish. Additionally, plans are underway for two cruise terminals at hurghada and Sharm El Sheikh on the Red Sea, alongside an integrated logistics park at Alexandria’s port.

In 2022, DP World entered into a similar partnership concerning Sokhna port located just southwest of Port Suez. With an initial investment of $80 million earmarked for building a logistics park, DP World is also set to develop additional facilities including liquid bulk handling capabilities, specialized warehouses, a sugar refinery, and livestock processing areas—all linked to an upcoming industrial zone nearby. The first phase is already operational! Moreover, they signed an MOU in late 2024 to establish a free trade zone in Egypt’s New Administrative Capital.

With AD Ports being owned by Abu Dhabi and DP World by Dubai,it means that UAE state entities will have significant influence over Egyptian logistics moving forward. This aligns with the UAE’s broader strategy aimed at controlling vital trade routes from the Gulf through Bab el Mandeb up to the Mediterranean—a route crucial for their economic survival.The UAE has invested heavily along this corridor not only commercially but also militarily; they’ve established airfields on islands like socotra while forming alliances with local governments along critical coastlines—an approach that serves both strategic military interests as well as commercial ones since DP World manages about 10% of global container capacity across 34 countries.

While some critics point fingers at Egypt regarding its rising debt levels or investments in high-profile projects like its New Administrative Capital—frequently enough labeled ‘vanity’ projects—the agreements with Emirati firms bring much-needed capital without directly impacting external debt figures right away. Currently facing $11 billion owed to the International Monetary Fund (IMF),which makes it one of their largest debtors after Argentina—with its debt-to-GDP ratio hovering around 91%—Egypt is still faring better than nations like the US or UK whose ratios stand at about 98% each.

A pressing issue remains: revenue losses from Suez Canal operations due to Houthi attacks affecting shipping routes in nearby waters have hit hard; revenues plummeted from $9.4 billion during fiscal year 2022-23 down to projections of just $1.8 billion by fiscal year 2024-25! Even though ther was hope that improvements made since investing $8 billion into canal upgrades would yield higher returns soon enough post-investment—the ongoing conflict means recovery may take longer than anticipated.