Hong Kong-listed COSCO Shipping Ports Ltd (CSPL), a subsidiary of Shanghai-based China COSCO Shipping Corp that specializes in port operations, announced on Thursday that it has acquired a 25 percent stake in a new container terminal at Egypt’s Ain Sokhna Port for about $375 million.
Ain Sokhna Port is a major port for Egypt, the Persian Gulf, and Asia, located at the south of the entrance to the Suez Canal, approximately 120 kilometers east of Cairo. The port is close to the northwest end of the Suez Canal Economic Zone, which has an area of 460.6 square kilometers and is expected to be developed into Egypt’s industrial, technological, and global logistics center, according to Egypt’s growth plans.
The new container terminal project, which CSPL signed an agreement with its partners in Egypt on Wednesday, is expected to have a throughput capacity of 1.7 million twenty-foot equivalent unit containers upon completion. CSPL will operate this project for 30 years.
The new container project will be constructed and operated by a number of companies from different segments in both Egypt and other countries. The investment in the Ain Sokhna Port terminal will help CSPL optimize its global layout, the company said in a statement.
CSPL is involved in the development of another terminal in Egypt, the Suez Canal Container Terminal, located at Port Said, which functions as a transshipment hub for the eastern Mediterranean region at the northern entrance to the Suez Canal. By the end of 2022, the Chinese company operated and managed 367 berths at 37 ports worldwide, of which 220 were for containers, with a combined annual handling capacity of 122 million TEUs.
CSPL’s portfolio of terminals to date covers Asia, the Middle East, Europe, South America, and the Mediterranean. Its sustained expansion of its global terminal network is one of the company’s key growth strategies, according to Zhao Fengnian, CSPL’s chief accountant.
CSPL’s investment in Ain Sokhna Port’s geographic location will facilitate China, Egypt, and other economies participating in the Belt and Road Initiative to boost their export volume and generate business opportunities in transportation, manufacturing, and service sectors. The investment will help improve trade links between China and Egypt/Africa, said Zhao.
Liu Zhongmin, a professor in Middle East Studies at Shanghai International Studies University, said that with Egypt and China creating more favorable conditions to enhance the synergy between the BRI and Egypt’s Vision 2030, their economic and trade ties will be further enriched in the coming years. Launched in 2016 by the Egyptian government, Vision 2030 is a unified long-term political, economic, and social vision developed in line with the United Nations Sustainable Development Goals.
In recent years, Egypt has been successful in drawing Chinese investments under the BRI framework. The flagship project in this context is the China-Egypt TEDA Suez Economic and Trade Cooperation Zone, which has gradually become one of the important platforms for China-Egypt economic and trade cooperation, according to information released by the Egyptian embassy in Beijing.
Overall, CSPL’s investment in the new container terminal project at Ain Sokhna Port represents a strategic move that has the potential to significantly improve trade and logistics in the region and beyond, while also contributing to China’s Belt and Road Initiative and Egypt’s Vision 2030 goals.