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Wednesday, 14 July 2021

The private sector will run much of Egypt’s rail network

SMART POLICY- Nine Egyptian companies — almost all of them private sector — will manage and operate Egypt’s rail system under a cooperation protocol signed with the National Railways Authority. Transport Minister Kamel El Wazir isn’t using the word “quasi-privatization,” but it feels very much like a step in that direction. The minister emphasized in a press release (pdf) that bringing in private-sector operators will improve the quality of rail service. The move comes after a string of rail accidents that have kept the sector in the spotlight.

Who’s in? The Transport Ministry is bringing in Orascom Construction, Samcrete, Elsewedy Electric, Hassan Allam Holding, Arab Contractors, Concord Engineering and Contracting, Alkan, Al Gharabli Group and Triangle Group. The ministry hasn’t made clear which companies are in the running for which contracts or roles.

What will they do? The companies will manage all of the country’s under-construction “modern means of transportation,” including two new monorail lines, a light-rail train (LRT) connecting Salam City and Tenth of Ramadan City (which will also be operated by France’s transportation operator RATP Dev), the new Bus Rapid Transit (BRT) system as well as the Abu Qir Metro and El Raml tram. The contracts will cover the operation and maintenance of passenger trains and as well as locomotives, in addition to the maintenance and upgrades of tracks.

Wait, there’s more: The Transport Ministry wants to see a private-sector company offering rail freight services and others working on infrastructure development, the provision of “integrated services,” the repair and overhaul of rolling stock (both passenger and freight) and more. The ministry may also set up a company with Iratrac, a unit of Mantrac Group, to work on upgrades to rail lines, El Wazir said.

Please don’t call this privatization: The plan to involve the private sector doesn’t mean the government is looking to privatize the rail network, according to El Wazir. All railway activities and facilities will remain state-owned, and private-sector involvement is only aimed at expediting the planned overhaul of the national rail network, he said.

A long time coming: Bringing in the private sector to manage the country’s railways has been on the table since 2018, when the Transport Ministry began procedures to establish private sector-run companies to manage specific lines and functions — plans that went nowhere. Recent incidents including a derailment in Qalyubia and a collision in Sohag have put the plans on the fast track.

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