China & Egypt Strengthen Belt And Road Collaborations Including The Suez Canal International Logistics Zone
Egypt’s Free Trade Agreements with AfCFTA and the EU make it an attractive Chinese investment destination to access new export markets
China and Egypt have signed a deal to establish an intergovernmental cooperation committee aimed at further enhancing bilateral relations, in an agreement signed by Chinese Foreign Minister Wang Yi and his Egyptian counterpart Sameh Shoukry. Wang is on an official visit to Egypt and has also visited Syria.
“Egypt is one of China’s most important strategic partners among Arab countries, in the Islamic world, in Africa and among developing countries,” Wang said, reiterating that Beijing appreciates Cairo for its support on issues concerning Beijing’s core interests and said China also supports Egypt in safeguarding its own sovereignty, security, and development interests.
“China is ready to work with Egypt to deepen the alignment of their development strategies, expand cooperation in production capacity, infrastructure, new energy, space and aviation, as well as new and high-tech industries, and open up new prospects for mutually beneficial cooperation,” he said, adding that China will continue to support Egypt’s localized production of vaccines to help the country fight Covid-19.
For his part, Shoukry said that “Egypt is willing to work with China to strengthen their cooperation in economy, trade, industry, science and technology within the framework of the Belt and Road Initiative (BRI), expand people-to-people and cultural exchanges and maintain communication on the reform of the United Nations Security Council and other international and regional issues,” he added.
Egypt is currently regaining stability after the ”Arab Spring” disturbances and problems with fighting ISIL. It is a huge market of some 100 million people and an important regional player. Russia has also been making inroads into Egypt with a Special Economic Zone at Port Said near the mouth of the Suez Canal, building Egypt’s hi-speed Red-Mediterranean Sea railway and is shortly to conclude an Egyptian-Eurasian Economic Union free trade agreement.
Egypt is also part of the African Continental Free Trade Agreement (AfCFTA) which provides free trade on all African traded goods. China and Russia has also been investing in Special Economic Zones in Africa and is using these to relocate some production facilities there in order to both take advantage of the massive African continental consumer market as well as source commodities and cheaper labor. A primary example of this is the Suez Canal Zone which is invested in by both countries, China’s party being the Tianjin Economic & Development Area (TEDA). That is expected to become an important global logistics center and has already attracted numerous Chinese investors. The SC Zone is a total area of 7.23 square km in the Ain Sokhna district of Suez province, east of the Egyptian capital Cairo.
China and Egypt have a Double Tax Agreement, while Chinese companies may also be able to use Egypt as a base to access the European Union – Egypt has a Free Trade Agreement with the EU. Egypt can benefit from China in introducing modern industries while China can benefit from the different free trade agreements Egypt has with the European Union, Africa, EAEU, and Arab countries.
Silk Road Briefing is written by Dezan Shira & Associates. The firm has 28 offices throughout Asia, and assists foreign investors into the region. For strategic advisory and business intelligence issues please contact the firm at email@example.com or visit www.dezshira.com