What opportunities and challenges do you see in the Egyptian renewables sector?

Egypt has great potential for renewables projects, especially in solar energy. Renewable energy sources are becoming a necessity for all countries, and Egypt is heading in that direction. However, more projects are needed to fully harness this potential. The Arab Contractors is open to collaborating with renewable energy players from any country. While we don’t have any contracts in this area yet, we see promising opportunities.

One of the challenges in the renewables sector is the need for vast areas to implement solar projects. Additionally, acquiring technicians, know-how, and technology is crucial. Fortunately, Egypt now has access to these resources, making it more feasible to overcome these challenges.

Do you see the trend of large-scale infrastructure projects continuing in the future?

Yes, the development of large-scale infrastructure projects is ongoing throughout Egypt, and this trend is expected to continue. New Alamein in the north and the New Administrative Capital near Cairo are notable examples. These cities contain numerous mega-projects, and another city, New Mansoura, is also being built. The growing population, which increases by nearly 1 million each year, necessitates the construction of new cities, infrastructure, and electricity generation. Egypt has undergone significant changes in the past two years, creating ample opportunities for new players in the construction industry.

What role does the energy construction industry play in The Arab Contractors’ overall operations?

While our core business remains infrastructure development, such as bridges, roads, water plants, sewage plants, and large buildings, we have also been involved in energy-related projects. In Egypt, we have worked on power plants such as Abu Qir, West Cairo, and the Suez thermal power plant. Internationally, we are constructing the Julius Nyerere hydropower plant in Tanzania in collaboration with the Egyptian company Elsewedy Electric. This project is significant for Tanzania’s development as it addresses their energy supply shortage. Energy-related projects currently make up around 5% of our overall revenues, but we are exploring opportunities to expand our presence in the energy construction sector.

What are your plans for the energy construction sector?

We recognize that penetrating the historically closed club of the oil and gas industry is challenging, but we see it as an opportunity. Egypt’s market needs more players and resources in this sector. We are considering partnering with Petrojet and Enppi to undertake energy-related projects in Africa, potentially creating a joint venture. We have already begun communication with Petrojet and are learning from more experienced energy players. While our primary focus remains on infrastructure projects, we are actively exploring opportunities in the downstream sector.

How do you assess the electricity landscape in Egypt?

Egypt has made significant progress in addressing its electricity supply issues over the past seven years. Previously, there were frequent power cuts, but the Minister of Electricity and Renewable Energy, Dr. Mohamed Shaker, swiftly addressed the problem. His expertise as both a politician and a scientist has played a crucial role in resolving this issue and ensuring a stable electricity landscape.

How did The Arab Contractors manage to maintain operations during the pandemic?

Like any company, we faced challenges during the pandemic, particularly in coordinating with international partners and importing materials. However, we successfully implemented measures to protect our employees, such as social distancing and remote work options for those who were unwell. Fortunately, as a construction company, most of our employees work on construction sites, which are primarily outdoors. We embraced online meetings to overcome some of the obstacles, but there were still difficulties when it came to professionals from abroad and equipment testing or commissioning. Fortunately, Egypt did not experience a strict lockdown, and the number of COVID-19 cases remained limited.

What’s your view on foreign and local investment appetite for Egyptian infrastructure projects?

Foreign investment has been affected by the pandemic, but we anticipate a return to normalcy, likely by next year as vaccinations progress and COVID-19 measures are reduced. Egypt’s large population and educated workforce make it an attractive market for infrastructure projects. In terms of financing, both international and local sources are currently going well for our company.

What is your international expansion agenda like?

The Arab Contractors has had a long-standing strategy of working in other African and Arab countries for over 60 years. When we operate in these countries, we aim to be an integral part of the community, training local labor forces and sourcing materials locally or from adjacent countries. We are proud to contribute to the development of these nations. We have been working in Uganda for 19 years, and we are also present in Nigeria for over three decades, operating in six states. Although Chinese companies present tough competition with their resources and financing capabilities, we are keeping up with them.

How important is it for Egyptian construction companies to provide their services beyond the border?

It is crucial for Egyptian construction companies to expand their services beyond Egypt’s borders. Egypt possesses abundant human and technological resources, as well as extensive experience and equipment. Strengthening relationships with African countries is vital since Egypt is an essential part of the African continent. Over the years, more Egyptian companies have started working in other African countries, and we believe this trend should continue.

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