Abu Dhabi Ports Group is investing in three cruise terminals in Egypt, which is expected to boost the country’s key tourism sector.
The investment of $3 million is a part of a 15-year concession agreement with the Red Sea Port Authority that includes the ports of Safaga, Hurghada, and Sharm El Sheikh.
AD Ports announced on Friday that a final agreement is expected to be reached during the first quarter of 2024.
As part of the collaboration, AD Ports and RSPA will provide new services, enhance access for cruise operators, add new routes in all three ports, and also renovate the Sharm El Sheikh terminal.
The movements will be crucial in boosting the Egyptian economy and the cruise business of AD Ports Group in the Red Sea region.
“The company stated that it supports a large number of cruise passengers and enhances both the passengers’ experiences and the cruises.”
“According to Ahmed Al Mutawa, regional CEO of AD Ports, this agreement demonstrates our commitment to promoting tourism in the Red Sea region and strengthening the existing ties between the United Arab Emirates and Egypt.”
AD Ports Group is prepared to boost cruise tourism in the Red Sea, offering world-class services and facilities to these ports while also supporting Egypt’s economic growth.
The travel and tourism sector has been an important source of revenue for Egypt, the most populous nation in the Arab world, contributing around 32 billion dollars to the GDP in 2022 and employing about 2.4 million people, according to Statista data.
In the same year, international tourist spending exceeded domestic spending for the first time since 2020, when the Covid-19 pandemic paralyzed economic activity, it was added.
In the fiscal year 2023, which starts in July, tourism revenues in the balance of payments reached a historic high of $14 billion, supported by Egypt hosting the Cop27 climate change summit in November 2022.
However, the sector is expected to continue being highly sensitive to exchange rate trends and inflation, as well as the consequences of the conflict between Israel and Gaza, according to a recent report from S&P Global.
Meanwhile, the Emirates is Egypt’s second largest trading partner in the region, while the North African country ranks fifth as a non-oil trading partner of the United Arab Emirates in the Arab region.
The new partnership between AD Ports and RSPA comes after their recent agreement to develop and operate a multipurpose terminal at the Safaga seaport in Egypt.
As part of the agreement, AD Ports will invest $200 million over three years to develop advanced units and infrastructure at the terminal. This includes the main structure, equipment, buildings, and public services.
AD Ports, listed on the Abu Dhabi Stock Exchange, has been taking steps to expand its operations and portfolio globally.
This week, the Spanish operations division, Noatum Terminals, announced the complete acquisition of APM Terminals Castellón for 10 million euros (11 million dollars), as part of its strategy to strengthen its operations in the Western Mediterranean region.
In June, he signed a 50-year agreement with the federal agency of Pakistan, the Karachi Port Trust, to enhance the infrastructure at its namesake port.
The company also entered into a 30-year concession agreement with the government of the Republic of Congo to manage and operate a multi-purpose New East Mole Terminal in the city of Pointe-Noire.
Other agreements announced last year include the acquisition of 10 offshore vessels worth $200 million to meet the growing demand in the energy sector, as well as an €81 million agreement with Spain’s Sese Logistics Group to purchase their finished vehicle logistics business.
Last year, AD Ports opened the Aqaba Cruise Terminal in Jordan, expanding the group’s portfolio in the Red Sea and their cruise expansion strategy.
