Tuesday, 25 March 2025

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ZONES

Egypt greenlights Alstom’s railway manufacturing complex project with a ‘private freezone’ designation

The under-construction project will initially include building two factories over an area of 40k feddans to manufacture components for Cairo Metro Line 6 and cables

Egyptian Gov’t greenlights Alstom’s Borg El Arab railway manufacturing complex freezone plans: Egypt’s ministerial group for industrial development approved French rolling stock company Alstom’s EUR 80 mn railway manufacturing complex project in Alexandria’s Borg El Arab’s logistics and industrial zone, according to a cabinet statement. The approval also grants the project the ‘private freezone’ designation.

This is the first time we hear about the project’s private freezone designation, which is granted to strategic projects on a case-by-case basis, usually when the project’s economic feasibility is dependent on establishing it in a specific location outside public freezones, according to a publication by the General Authority for Freezones and Investments.

About private freezones: Current regulations require private freezone projects to export at least 80% of the production, with the possibility of exceptions for projects with “special strategic importance.” They also require that local components account for 30% of the production. Earlier in October, it was reported that Egypt is preparing amendments to the regulation that would raise the exports and local components requirements to 100% and 70%, respectively.

What we know so far about the project: The under-construction project will initially include building two factories over an area of 40k feddans (c. 41.5k acres) to manufacture components for Cairo Metro Line 6 and cables. Production is planned to begin in 1Q 2027.

ICYMI- Rowad Modern Engineering was awarded the contract to construct one of the factories planned for the railway manufacturing complex in Egypt last week. Rowad already kicked off construction work of the plant, with plans to wrap it up in no longer than two years. The tender for the main manufacturing factory has not been issued by Alstom yet, an insider source with knowledge of the matter told us then. Production will be earmarked for both local use and exports to markets in the Middle East and Africa.