A major Chinese construction firm has sealed a deal with Egypt to partly sponsor an ambitious plan to build a new administrative and business capital for the north African country.
The project would make president Abdel Fattah Al-Sisi’s announcement in March 2015 more practical, giving that the Chinese state-owned company will support the project with $15 billion in loans, grants and memorandums of understanding, Chinese news agency Xinhua reports.
The $45 billion project would be constructed on 700 square kilometers of desert land.
The alliance was announced in January between Egyptian authorities and China State Construction Engineering Corporation. Neither side has however announced details of the agreement.
According to the Minister of Housing, Mostafa Madbouly, Egypt had launched the first phase of construction of its new capital east of Cairo in April.
The Chinese companies will provide Egyptian contractors with long-term loans to finance the construction of 14 new government buildings, a major conference center and a fair zone.
Chinese president Xi Jinping during his visit to Egypt in January had suggested that China and Egypt could coordinate their development strategies and visions, and focus on cooperation in infrastructure and production capacity.
The planned new Egyptian capital was designed to relieve Cairo, which is home to nearly 22 million people, of congestion. Officials expect the population in Cairo to hit 40 million by 2050.