Saudi Arabia, Egypt to fund $10-billion mega-city project

Egyptian President Abdel Fattah al-Sisi meets with Saudi Crown Prince Mohammad Bin Salman at the Ittihadiya presidential palace in Cairo, Egypt, March 4, 2018 in this handout picture courtesy of the Egyptian Presidency. Picture taken March 4, 2018. The Egyptian Presidency/Handout via REUTERS

Saudi Arabia and Egypt have agreed to jointly fund a $10-billion project to develop a new mega-city in the southern area of Egypt’s Sinai Peninsula.

The new project was announced Sunday as Saudi Arabia’s Crown Prince Mohammed bin Salman visited Cairo and met with Egyptian President Abdel Fattah al-Sisi

Both countries are committing more than 1,000 square kilometers (386 square miles) of their territory for the future mega-city, which will be located in the southern Sinai Peninsula along the coast of the Red Sea and the Gulf of Aqaba.

The project will include a business district and will focus on key industries including water and energy, food, media, advanced manufacturing, biotechnology, and entertainment. The mega-city will be built on a partnership between two of the most powerful Arab countries. Saudi Arabia is considered the richest Arab nation, while Egypt is the most populous of the Arab countries.

Riyadh has been a crucial financial backer of Sisi, and Saudi Arabia and Egypt have been strengthening their economic ties since he came to power in 2013 after ousting his elected predecessor in a popular-backed coup. Since then, Riyadh has been pouring billions of dollars into helping prop up the Egyptian economy.

The mega-city deal comes just three weeks before Egyptians cast their votes in a presidential election, with Sisi looking to secure a second term as head of the state.

The mega-city is only one of Saudi Arabia’s numerous plans under its Vision 2030 growth strategy, in which it aims to diversify its industries and lean away from its reliance on its depleting oil resources.

The country is also planning to build seven cities and tourism projects with a focus on the Red Sea. Saudi Arabia is working with Egypt and Jordan to attract more European cruise and tourism companies from the Mediterranean to consider operating in the Red Sea.