Egypt is set to host the summit of the New Partnership for Africa's Development (NEPAD) in early October, a move that could potentially boost the country's economic ties with the African continent. NEPAD is one of the most serious attempts to develop the African continent and eradicate poverty through partnership with the international community and regional partnerships. Egypt was one of the founding countries of the initiative, and President Abdel Fattah El-Sisi chaired the steering committee of the heads of state and government of the agency from 2023 to 2026.
During Egypt's chairmanship, the focus was on financing development, increasing NEPAD's ability to mobilize the necessary resources for continental projects, and supporting infrastructure, energy, agriculture, manufacturing, and digital economy sectors. According to Egyptian data, the initiative aims to mobilize $500 billion in financing for around 300 projects, in addition to establishing a development fund for NEPAD and other initiatives in health, agriculture, capacity building, and the digital economy. These numbers reflect the size of investment needs in the continent.
The main opportunity for Egypt is not necessarily to obtain financing for projects within the country, but to participate in implementing continental projects that African countries need. Egyptian companies have experience in construction, infrastructure, energy, communications, pharmaceuticals, food industries, and engineering, which are sectors that align with many of NEPAD's priorities. However, taking advantage of this opportunity requires a more organized mechanism than the traditional move in African markets.
An integrated database of projects included in NEPAD programs, their stages, sources of financing, and responsible parties is required, and then linking them to Egyptian companies capable of implementation. Companies also need accurate information about target markets, legislative environment, financing systems, taxes, customs, and local partners. This role can be shared by the government, the banking sector, and industrial and commercial unions.
Transportation and continental connectivity projects are of special importance to Egypt. Road, railway, port, and commercial corridor projects not only improve movement within Africa but can also reshape trade between countries on the continent. The Cairo-Kigali project, for example, is linked to the idea of creating a land and commercial corridor that connects the north of the continent to the south. These projects are important to Egypt for two main reasons: opening new markets for Egyptian companies and products, and enhancing Egypt's position as a transportation and logistics hub.
The improvement of transportation networks reduces the cost of delivering goods to African markets, which is a factor affecting the competitiveness of Egyptian exports. This impact increases with the implementation of the African Continental Free Trade Area, as the removal of trade barriers will not achieve its full results without an infrastructure capable of efficient transportation, financial and banking systems that help finance trade, and logistics services that connect the producer to the markets.
There are other opportunities in energy, agriculture, water, manufacturing, and the digital economy, which are basic needs for African countries, and at the same time, Egypt has experiences and companies that can participate in them. However, entering these markets requires different models of cooperation, including joint investment, local production, and technology transfer, not just exporting products. Increasing Egypt's economic presence in Africa can support political relations in the long term, as government relations open the way for cooperation, but investments, trade, and supply chains create continuous interests between countries and the private sector.
Key points
- Egypt to host NEPAD summit to boost economic ties with Africa
- Egyptian companies seek to participate in $500 billion worth of African projects
- NEPAD offers opportunities for Egypt in transportation, energy, and digital economy sectors
