meed-logo

line1 line2 line3
SIGN IN / REGISTER

Egypt’s construction sector faces delays

22 February 2023

This package on Egypt’s construction and transport sectors also includes:

> Egypt’s El-Attal launches $229m development

> Qatari Diar selects New Cairo project contractor

> Japan inks a new Cairo metro loan

> NMDC to execute $272m Egypt dredging works

> Bidders prepare Egypt dry port proposals

> Egypt qualifies firms for schools PPP

 

After seven years of continuous growth, Egypt’s construction sector is showing signs of wobbling amid the country’s economic troubles.

The value of construction and transport contract awards in Egypt has grown every year since 2015 and rose to record highs in the past two years, according to regional projects tracker MEED Projects. It grew by 44 per cent to $19.3bn in 2021 – from $13.4bn in 2020 – before rising again by 31 per cent to $25.4bn in 2022.

In January, however, the value of construction and transport contract awards fell to less than $200m. This was the lowest monthly total since July 2016, and well below the $2.6bn of contract awards in January 2022.

Although the general outlook for the construction sector is strong, economic volatility presents downside risks, at least in the short term.

“Things are at a standstill for the moment,” says Salwa Elbakry, business development director for Egis in Egypt. 

“Several tenders were set to be issued in early January and February, but due to the current economic situation, including devaluation, there were some delays.”

This slowdown started in June, when the currency crises deepened. Companies remain optimistic, however, as “Egypt has proven to be a versatile economy”, says Elbakry.  “There are a lot of positive outlooks for 2023. By the end of the first quarter or the beginning of the second quarter, things will get better.”

As Egypt’s major projects are backed by sovereign funds, international investors and institutions, it is “business as usual”, she adds.

Cairo’s positioning as a destination for international investment has grown in recent years. In 2021, Egypt’s International Cooperation Ministry secured $10.2bn in development financing, of which $8.7bn was dedicated to public sector projects and $1.5bn to private sector development.

GCC investors continue to believe in the Egyptian market as well. “The ties between the GCC and Egypt go way back,” says Elbakry.

Focus on key projects

While the IMF suggested in January that Egypt should curb its project spending, the government has said its major projects are vital for the country’s development and a vehicle for GDP growth.

Recently, Egyptian president Abdul Fattah al-Sisi pledged that national projects would continue. Ongoing infrastructure schemes include a high-speed railway network; roads and bridges; hospitals; and several new cities, including the $20bn new capital, to the east of Cairo.

“Egypt continues to be driving ahead with a lot of big projects,” says Raouf Ghali, CEO of Hill International. “It is the first time I have seen Egypt working on projects and programmes that rival the GCC, and this is very unusual.”

Other sectors that are expected to initiate new developments are tourism, healthcare and education, as well as logistics.

“This year will witness several public-private partnership schemes related to tourism, ports and industrial zones,” says Elbakry. “There is also a lot of buzz around the hospitality sector.”

Rail versus real estate

Railway projects make up $10.5bn, or 90 per cent, of the $11.7bn-worth of construction and transport projects in the bidding phase in Egypt.

The two largest upcoming projects are for work on the Cairo Metro: a $5bn Line 6 package and an $800m package for phase one of Line 4. Both schemes are in the bid evaluation phase.

Schemes on the Alexandria Metro are the next biggest pending awards. The National Authority for Tunnels is receiving bids for two $750m packages for the line between Abu Qir and Misr Station.

With the ongoing currency and inflation crisis, Egypt is trying to use more local resources and further reduce its imports of construction materials. The demand for foreign expertise remains strong in sectors such as rail, however.

“While the Egyptian market is rich in engineering and architectural skills, some projects like aviation, rail, ports, smart cities or water require international know-how,” says Elbakry.

The World Bank Group approved a further $400m in financing in 2022 to support railway network development in Alexandria and Cairo.

Real estate has been another booming sector in recent years, driven largely by domestic demand. Yet the outlook might be shifting now, with projects in the sector appearing to be scaling down and foreign funding showing signs of drying up.

“Egyptians rely on real estate as an investment,” says Elbakry, adding that the market is currently at a standstill because “the only people able to invest in real estate at the moment are high-income individuals”.

For the moment, “everybody is watching what the Central Bank is going to do with the currency and the exchange rate”, says Ghali.

“For construction companies, it is great to get these big contracts, but devaluations after signing contracts do not help profitability. 

“It also creates a lot of insecurity because you have a lot of cash in the country that you cannot export, which makes it a very challenging environment,” he adds. 

“Overall, we are bullish, but also very cautious because of the currency situation.”

MEED's March 2023 special report on Egypt also includes:

> GOVERNMENT & ECONOMY: Egypt faces up to economic reality

> POWER: Crisis dampens Egypt’s energy diversification

> WATER: Egypt turns to private sector for water

> BANKING: Interesting times for Egypt’s lenders

 

https://image.digitalinsightresearch.in/uploads/NewsArticle/10585786/main.gif
Eva Levesque

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Oil prices rise above $100 a barrel as conflict escalates

    9 September 2026

    Register for MEED’s 14-day trial access 

    Oil prices rose above $100 a barrel on 9 September for the first time since July as the US-Iran conflict escalated and Iran-backed Houthi forces attacked Saudi energy infrastructure.

    Brent crude futures reached $100.95 a barrel, while US benchmark West Texas Intermediate (WTI) rose to $95.60. Brent had last traded above $100 on 24 July.

    The latest escalation has heightened concerns about oil supplies from the region, with shipping through both the Strait of Hormuz and the Red Sea facing disruption.

    Flows through the Strait of Hormuz had fallen below 2 million barrels a day (b/d) from about 8-9 million b/d before the latest escalation, according to Rystad Energy.

    At the same time, Houthi attacks on Saudi Arabia threaten another important route for oil exports, with the group targeting energy infrastructure and shipping in and around the Red Sea.

    US strikes on Iranian tankers

    US forces destroyed five Iranian crude oil carriers on 8 September after Iran’s Islamic Revolutionary Guard Corps (IRGC) targeted a US Navy warship with ballistic missiles.

    The US Central Command (Centcom) said the warship successfully evaded two Iranian attacks and that no US personnel were harmed.

    Four of the Iranian vessels – Kaviz, Charminar, Horizon 1 and Riesco – were struck in the Gulf of Oman, while the Derya was attacked near Kharg Island, Iran’s main crude export hub.

    The M/T Riesco subsequently sank in the Gulf of Oman, according to Centcom.

    Iran responded by launching ballistic missiles towards Jordan. Jordan’s armed forces said 18 of 20 missiles were intercepted, with the remaining two falling in unpopulated areas.

    Iran’s IRGC also said it had attacked two US naval vessels, eight oil tankers and 10 other vessels in the Gulf, although it did not identify the vessels or provide evidence of the attacks.

    The latest exchanges mark a further escalation in the US-Iran conflict, which began on 28 February.

    Houthi attacks raise supply concerns

    The conflict has also widened into a renewed confrontation between Saudi Arabia and Yemen’s Iran-backed Houthi movement.

    On 8 September, Saudi authorities said Houthi attacks had targeted civilian and economic sites in Abha, Khamis Mushait, Jazan and Najran in the south of the kingdom, injuring 73 people.

    Saudi Arabia’s Ministry of Energy said several energy sector facilities and installations had been targeted, causing fires and forcing a temporary halt to some operations.

    The Houthis said their attacks were in response to Saudi military action in Yemen, including what they described as attacks on Houthi positions and a Saudi blockade of ports and airports.

    Riyadh condemns attacks

    Saudi Arabia has strongly condemned the Houthi attacks and warned that it would take measures to defend its territory and national assets.

    In a statement on 8 September, the Ministry of Energy said authorities were working to address the impact of the attacks and ensure the safety of facilities and personnel while maintaining operations in accordance with approved plans.

    Saudi Arabia’s Ministry of Foreign Affairs also condemned the attacks and said the kingdom had the right to take measures to defend its sovereignty and protect its citizens, residents and national assets.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19505512/main0138.jpg
    Indrajit Sen
  • What actually slows a gigaproject down

    9 September 2026

     

    Ask anyone delivering a major programme in the GCC what causes delays and sequencing will come up early. Utilities go in too late. Approvals lag behind construction. Stations, depots and access roads are procured as if they belong to different projects rather than one system.

    “None of this is new. The industry has understood these risks for years,” says Alan Caldwell, managing director for transport and infrastructure at WSP Middle East.

    For Caldwell, that is what makes the pattern worth interrogating rather than simply restating.

    “The more important question is why the same issues around interfaces, approvals, stakeholder alignment and delivery sequencing continue to slow major programmes when the risks are already so well understood,” he says.

    The answer, he argues, is not that these programmes are too big or too technically complex. What breaks a schedule is a wider system delivered as a set of disconnected parts; an approval sitting with an authority team with no visibility of the construction sequence downstream; or a station package proceeding without the utilities diversion it depends on.

    “Infrastructure programmes do not struggle because a railway is too large or a highway network is too complex,” Caldwell says. “They encounter difficulties when interconnected elements are delivered in the wrong order.”

    Sequencing decisions are rarely purely technical either, he adds. They are commercial – shaped by which assets need to unlock value first, which phases are tied to funding, and where sales or investment assumptions depend on infrastructure landing in a particular order.

    Approvals sit at the centre of that logic. On many programmes, they become one of the biggest sources of lost time – not because the requirements are unreasonable, but because approvals are not planned, evidenced or owned as part of the delivery logic from day one.

    Caldwell has seen the same pattern across three decades of Gulf delivery, from early work on Palm Jumeirah to today’s region-wide transport programmes.

    “The decisive factor has often been the same: whether interfaces, approvals, responsibilities and delivery sequencing are aligned early enough to prevent complexity becoming delay.”

    Integration needs to be well understood

    “Most programme teams in the region would say they understand the need for integration,” Caldwell says. Fewer are structured to deliver it. “The harder task is turning that understanding into the way projects are actually set up and managed,” he argues.

    Riyadh Metro is the reference point he returns to, precisely because engineering complexity was not the deciding factor in its delivery.

    Coordinating a city-scale transport system meant aligning design, construction, systems, utilities and stakeholder interfaces across every delivery vertical.

    “The lesson for the region today is clear,” Caldwell says. “Ambitious programmes need a delivery model that gives every contributor a shared view of progress, risk, decision-making and the business case driving programme priorities.”

    That shared view, he argues, will be what the next phase of Gulf delivery is judged on.

    Whether clients, consultants, contractors, operators and approval authorities can work to a single delivery logic will be key.

    “This requires more than coordination meetings. It requires integrated ways of working, shared common data environments and governance structures that make risks, decisions and dependencies visible before they become delays,” he says.

    From reporting progress to managing risk before it lands

    Digital tools have a role here, Caldwell says, but not as a headline in themselves.

    Digital twins, programme visualisation and data-led modelling matter only if they help teams identify and address problems before they affect the wider programme.

    “The real value is not technology for its own sake,” he says. “It is the ability to see, in one place, where approvals are outstanding, where interfaces are unresolved, where programme dates are slipping, where clashes are emerging and where decisions need to be escalated."

    None of it works without governance behind it, he cautions. “A dashboard will not resolve a delayed approval if nobody knows who owns the decision, when it needs to be made, or how it should be escalated.”

    Data only has value if the processes and responsibilities around it are clear, which is why Caldwell frames the shift the region needs not as digitisation, but as a move “from programme management as a discipline focused mainly on reporting and coordination, and towards project and programme intelligence”.

    With many of the region’s programmes running for a decade or more, he adds, delivery models also need to flex as funding assumptions, user needs and policy priorities change along the way.

    “The ambition behind the Gulf’s transformation programmes is not in question,” Caldwell says.

    What will determine how much of it is realised on time is whether delivery models evolve at the same pace: earlier integration, clearer approval pathways, shared data environments, and every contributor working to a delivery logic that connects technical sequencing with the funding and operational case behind it.

    “The region’s next challenge is not imagining bigger projects,” he says. “It is changing the way they are delivered, operated and adapted over time.”

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19502016/main.gif
    Yasir Iqbal
  • Qatari firm wins $221m Qiddiya stadium MEP deal

    9 September 2026

     

    Register for MEED’s 14-day trial access 

    Qatari contractor Elegancia MEP, part of Estithmar Holding, has won a SR829m ($221m) mechanical package contract for the Prince Mohammed Bin Salman Stadium in Qiddiya, Saudi Arabia.

    The contract covers full mechanical, electrical and plumbing (MEP) works for the stadium, and is Elegancia MEP’s largest award in Saudi Arabia to date.

    The 45,000-seat stadium will feature a fully combined retractable pitch, roof and LED wall.

    The stadium’s main construction works are being undertaken by a joint venture of Spanish firm FCC Construction and local firm Nesma & Partners.

    Saudi gigaproject developer Qiddiya Investment Company awarded an estimated SR15bn ($4bn) deal to build the stadium in October 2024, as MEED exclusively reported.

    The contract covered the construction of a multipurpose stadium on top of the 200-metre-high Tuwaiq cliff in the new sports and entertainment district of Qiddiya City.

    Once completed, the stadium will be the home ground for Saudi Pro League football clubs Al-Nassr and Al-Hilal.

    US-based architect Populous is the project consultant.

    The stadium is one of the venues for the kingdom’s 2034 Fifa World Cup bid and will host events such as the Saudi King Cup, the Asian Cup and the 2034 Asian Games.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19501493/main.jpg
    Yasir Iqbal
  • Jordan tenders advisory for wastewater treatment plant

    9 September 2026

    The Water Authority Jordan (WAJ) has issued an invitation to prequalify for advisory services for the rehabilitation and expansion of the Shallala wastewater treatment plant in Irbid, northern Jordan.

    The Shallala plant was commissioned in 2013 with a design capacity of about 14,000 cubic metres a day (cm/d).

    The rehabilitation and expansion project will increase its treatment capacity to about 30,500 cm/d to meet projected wastewater flows through 2050.

    The PIU Support and Construction Supervision Consultancy Services tender was released on 19 August.

    The submission deadline is 21 September.

    The consultancy will support the project implementation unit and provide construction supervision services for the project. The project has an estimated value of $69m and is being financed by the European Bank for Reconstruction and Development.

    The planned works include rehabilitating the existing activated sludge and treatment units and constructing a new treatment train.

    The scope also includes installing biogas combined heat and power units, improving sludge handling and dewatering systems, and installing odour control and chemical containment systems.

    WAJ is also undertaking the upgrade and expansion of the Ain Ghazal wastewater treatment plant in Amman.

    The existing facility had a capacity of 330,000 cm/d and is being upgraded to 726,712 cm/d to accept and treat expected incoming flows until 2045.

    The local Arab Towers Contracting Company was appointed as the main contractor for the project last year.

    READ THE SEPTEMBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Nuclear power ambitions gather pace; Kuwait keeps dealmaking alive despite war; Region invests in raising gas processing capacity.

    Distributed to senior decision-makers in the region and around the world, the September 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/19498520/main.jpg
    Mark Dowdall
  • Consultants bid for Abu Dhabi light rail project management

    9 September 2026

     

    Register for MEED’s 14-day trial access 

    Abu Dhabi Transport Company (ADTC) has issued a request for prequalification (RFQ) notice to consultants for a contract for project management engineering consultancy services for the first phase of the light rail transit network, also known as ADT4.

    The notice was issued on 7 September, with a submission deadline of 9 November.

    The project’s first phase will span 19 kilometres (km) and include 23 stations, connecting Zayed International airport (AUH) with nearby areas, including Yas Island, Al‑Raha Beach and Khalifa City.

    The key sections of the tram are:

    AUH to Yas Island: The tram will start from Terminal A at AUH and run through the Yas tunnel to Yas Gateway Park. It will serve areas including Yas Bay, Media Zone, Yas Plaza, Yas Drive, Yas Mall, Sea World and Water Edge.

    This section covers 13km and includes 13 at-grade stations and one underground station.

    Al-Raha: This section will stretch for 4.3km and run along Al-Raha Street. It will serve areas including Al-Zeina, Al-Muneera and Al-Bandar, towards the Aldar head office. The section will include seven at-grade stations.

    Etihad Plaza: This section will pass the Etihad Aviation Training Centre and span about 1.7km. It will feature a main depot near the Etihad Airways headquarters, along with two at-grade stations.

    The tender also covers the procurement of 25 trams, each with a capacity of 270 people, along with associated systems.

    The project was officially launched at the GlobalRail exhibition in Abu Dhabi in October last year.

    Referred to as Abu Dhabi Tram Line 4, the project will be delivered in three phases.

    Construction of the first phase is expected to start next year. The tram is slated to begin operations by 2030.

    Future phases will extend towards Khalifa City and serve additional destinations across Yas Island.

    The project forms a key part of the recently announced AED170bn ($46bn) package of national transport and road projects to be implemented by 2030.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/19493532/main.jpg
    Yasir Iqbal