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Monday, 17 December 2018

Egypt-China talks for USD 20 bn new capital project, monorail financing have reportedly fallen through

Egypt-China talks for a USD 20 bn project in the new capital have reached a deadlock amid a fight over revenue sharing, officials told Bloomberg. China Fortune Land Development (CFLD) had been in talks with Egypt for the past two years to develop the large-scale project over a 25-year period in the new administrative capital. The newswire notes that the disappointing end of the two-year negotiations could affect sentiment among foreign investors, but we’re not certain European and US investors will necessarily be put-off by the retreat of Chinese money. Local news had previously reported that talks were stalled after CFLD demanded a larger-than-initially-agreed stake in the project.

Other failed talks with China? Bloomberg notes that the breakdown in talks doesn’t mean Egypt will walk away from China (or even CFLD) on other projects. Still, it seems that talks with China’s Exim Bank on financing for a USD 1.2 bn monorail project have also fallen through, leading to its postponement, a transport ministry source told Al Shorouk. The official said the project, which will aim to link the new capital to 6 October, will be put on ice until the two sides reach consensus. He did not provide details on the disagreements. Egypt last month received three bids from international companies to construct two high-speed monorail lines.

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