Russia ready to build Suez Canal industrial zone – PM

Russia is willing to take part in establishing an industrial zone in the New Suez Canal project, Russian PM Dmitry Medvedev told Egypt’s daily Al-Ahram. The 72-kilometer section inaugurated on Thursday in Egypt will provide the fastest Europe-Asia shipping route.

“Our companies are willing to participate in these economic projects. Creating a Russian industrial zone in the Suez Canal could be the first step in this project. This issue is now being actively discussed at a ministerial level,” Medvedev said in an interview on Wednesday ahead of his visit to Egypt. The prime minister and the Russian delegation is taking part in the opening ceremony of the new Suez Canal on August 6.

The unique experience of Russian heavy engineering, metallurgy and energy industries could add efficiency to the large-scale project, according to Medvedev. Russia can also offer a range of services to Egyptian partners, including design and construction of industrial facilities, joint production and supplies of various types of equipment, as well as the necessary technical assistance. Automakers, manufacturers of building materials, river and sea transport companies, energy equipment and pharmaceutical producers are among the potential participants in the new project, he added.

READ MORE: Egypt ready to open ‘New Suez Canal’

Russia and Egypt plan to sign a bilateral memorandum of understanding and a roadmap for its implementation by December.

Medvedev expressed hope that Egyptian partners will provide its investors with the necessary support and create a comfortable environment for doing business.

The countries are also currently exploring the possibility of signing a free trade agreement.

“A free trade zone between the Eurasian Economic Union and Egypt would also provide good opportunities for the development of trade and investment,” Medvedev said.

Mutual trade between Egypt and Russia is on the rise, the PM said. Last year it reached $5.5 billion, almost twice that of 2013. Russian exports have doubled to $4.9 billion, while imports are up by almost 25 percent.

The two countries are discussing new joint projects in high-tech, heavy and light industries, conventional and renewable power engineering, transport engineering, agriculture, the telecommunications sector, pharmaceuticals, medicine and education.

Upgrading the Suez Canal involves a set of projects that will not only develop transport and logistics infrastructure, but will also create additional opportunities in industry, agriculture and the social sphere, the Russian prime minister said.

New Suez Canal unveiled

On Thursday, Egypt inaugurated the New Suez Canal, a 37-kilometer waterway dropping to a depth of 24 meters and running parallel with the existing 145-year-old Suez Canal.

Construction on the $8-billion canal extension started a year ago. The new route will reduce navigation time from the current 19 to 11 hours. Both canals will be connected by four smaller waterways and together will continue to provide the fastest route for shipping between Europe and Asia.

“Following 12 months of tireless work by the Egyptian people, the new waterway now allows for simultaneous northern and southern vessel transit for the first time in its history,” said a press release from the New Suez Canal administration on Thursday.

Considered a national project, the new route is aimed at increasing the capacity of the existing canal and offers an important chance to boost Egypt’s struggling economy.

The project attracted $8.5 billion in six days and is expected to produce $12.3 billion in revenues each year by 2023, which will more than double the canal’s current revenue intake. The vessel traffic is also expected to increase by about 50 percent, which will take the daily transit volume to 97 from 49.

“This is a proud day, not only for the Suez Canal Authority and President El-Sisi, but also for the entire Egyptian population, which has striven to achieve the near-impossible in order to make this dream become a reality,” said Admiral Mohab Mameesh, chairman of the Suez Canal Authority.