Current News & Events
Signing a Memorandum of Understanding (MOU) on the Financing of the Sinai Peninsula Development Program (Phase II) Signing a second loan agreement for Financing Tunnel Road Project - Sharm El Sheikh (within the Sinai Peninsula Development Program) In the Arab Republic of Egypt
During His Highness Sheikh Jaber Mubarak Al-Hamad Al-Sabah, Prime Minister of the State of Kuwait, visit of the Arab Republic of Egypt and in the presence of H.E. Dr. Mostafa Madbouly, Prime Minister of the Arab Republic of Egypt, an agreement was signed today in Cairo between the Government of Egypt and the Kuwait Fund for Arab Economic Development. An MOU regarding the financing Sinai Peninsula Development Program (Phase II) was signed today to implement phase II of the program totaling One Billion US Dollar for the period 2020 – 2022 through the provision of loans by the Kuwait Fund and to complement the phase l which ended on 2018-2019 fiscal year. Also a loan under which the Fund will provide a loan of KD 26 million (equivalent to about US $ 88 million) to contribute to the financing of the Tunnel Road - Sharm El Sheikh.
The Loan Agreement was signed on behalf of the Government of Egypt by H.E. Dr. Sahar Ahmed Mohamed Abdel Moneim Nasr, Minister of Investment and International Cooperation, and on behalf of the Kuwait Fund for Arab Economic Development by H.E. Sheikh Sabah Al-Khaled Al-Hamad Al-Sabah, Deputy Prime Minister and Minister of Foreign Affairs and Chairman, board of directors.
The Project aims to integrate the road network in the Sinai Peninsula and raise the level of safety of its use and reduce operating costs and transport time, thus contributing to the development efforts in
Project impact area, increased employment opportunities, as well as access to education and health services for the population. And to increase future trade traffic between the Arab Republic of Egypt and Saudi Arabia.
The project is located in the Sinai Peninsula, and the road takes a north-south route along the west coast of the peninsula, linking Suez and South Sinai. It starts in Suez Governorate east of the canal at the intersection of Cross Road 1 with the road of the martyr Ahmed Hamdy tunnel, passing through rocky and mountainous areas, and ends in Sharm El-Sheikh, which is located in South Sinai.
The project includes the construction of a road with a total length of about 350 km to a six-lane asphalt road (3 lanes in each direction with a width of 3.6 m per lane), a middle island with a width of 12.2 - 37.5 m, and side shoulders for each side 2.5 m wide and 0.6 m Meters internally. The project also includes water drainage works, protection, and safety works, as well as consultancy services including detailed design, review and supervision of implementation.
The term of the loan is 22 years, including a grace period of 7 years. The loan will be repaid in 30 semi-annual installments, the first of which is due on the first date on which interest or other costs are due, after the period of grace. The interest on the loan is 1.5% per annum, in addition to a 0.5% per annum fee to meet the administrative costs and services of implementing the loan agreement.
The total cost of the project, including reserves, taxes, fees, and interest during implementation, is estimated at LE 6,536.13 million, or about KD 113.977 million, of which about KD 75.073 million is in foreign currencies, thus foreign currencies constitute about 66% of the total cost.
The Fund's loan represents the 51st loan provided by the Fund to the Arab Republic of Egypt. The Fund has already provided 50 loans with a total value of about KD 1,013 million (equivalent to about US $ 3,444 million), of which KD 704 million has been withdrawn to date. This is equivalent to about 70% of the total amount of loans extended, of which KD 327 million was repaid, equivalent to about 46% of the total amount withdrawn. The Fund also provided 18 grants and technical assistance to the Arab Republic of Egypt with a total value of about KD 5.10 million, of which KD 2.42 million was withdrawn. The Fund also administered two grants from the Government of the State of Kuwait to the Arab Republic of Egypt, with a total value of about KD 4.840 million (equivalent to about US $ 16.5 million), which were fully withdrawn.