09 March, 2017

Egypt seeks investment for high-speed rail project

Rail network to connect tourist hotspots of Luxor, Hurghada and capital Cairo

09 March 2017

Egypt is seeking investment for a proposed high-speed rail project as part of plans to boost the Arab country’s vital tourism sector, the transport minister said.

"The project we have proposed is a three speed rail, one from Cairo to Luxor, Alexandria to Cairo and Luxor to Hurghada. These three lines are proposed for promoting the tourist activity, that is expected to reach by 2025 more than 30 billion tourists per year,” Hesham Arafaat told the Middle East Rail conference in Dubai on Tuesday.

"We are proposing (these lines) to be financed using any model like BOT (Build-Operate-Transfer) or direct finance,” he added.

The 700-km line running from the capital Cairo to the ancient town of Luxor, expected to carry 3.38 million passengers per year, is forecast to cost 6 billion euros and take five years to build, according to the minister’s presentation at the conference. It put the internal rate of return (IRR) on the project at 9 percent.

The 210-km line from Alexandria, the country’s second biggest city, to Cairo has an estimated cost of 3 billion euros, a three-year construction period and expected annual passenger traffic of 2.3 million. The IRR was forecast at 11 percent.

The 300-km line from Luxor to the Red Sea resort city of Hurghada is projected to cost 4 billion euros and to be completed in 4 years to handle 1.5 million passengers per year. It carries an expected IRR of 10 percent, according to the presentation.

The trains would run at 300 km/hour.

Egypt Tourism Minister Yehia Rashed told Reuters on Monday that the number of tourists visiting Egypt this year could come close to levels seen before its 2011 uprising. Around 9.3 million people visited the country in 2015 compared with more than 14.7 million in 2010.

(Reporting by Megha Merani)

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