Egypt - Transport and Logistics: Improving economy to drive investments (Strategy, Performance and Risk Analysis)
Egypt’s infrastructure base across the road, rail, air, and sea segments has been a key contributor to the growth in freight volume. New infrastructure projects in growing sectors such as air, rail, road and sea are expected to further drive freight volume. Egypt is moving forward with a well-balanced and diversified program to restore macroeconomic imbalances and achieve high, sustainable and well-diversified growth. The country has a dynamic and young population, a suitable geographic location, a large market size and access to important foreign markets, which bode well for the country. The opening of the New Suez Canal, large investments in the transportation sector and government programs will help grow the sector.
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Increasing trade drives freight volume growth
Egypt’s air freight traffic recorded a CAGR of 1.6%, rising from 356.3 million ton kms in 2012 to 386.2 million ton kms in 2017 and is anticipated to post a CAGR of 0.3%, from 393.3 million ton kms in 2018 to 397.8 million ton kms in 2022. The increase is primarily attributed to an increase in trade. Egypt’s transport exports recorded a CAGR of 12.4%, from US$71.1m in 2012 to US$113.3m in 2016. Similarly, the transport import market recorded a CAGR of 21.1%, from US$664.4m in 2012 to US$1,428.2m in 2016.
Rail network expansion projects to drive rail freight volume
Egypt’s rail freight traffic recorded a CAGR of 7.6%, rising from 1,166.0 million ton kms in 2012 to 1,685.5 million ton kms in 2017 and is anticipated to post a CAGR of 5.5%, from 1,816.5 million ton kms in 2018 to 2,247.4 million ton kms in 2022. The increase is partly due to Egypt’s rail network expansion projects such as the Alexandria and Aswan high-speed rail project, the Cairo Metro Line 3 extension works, and the 10th Ramadan - Ain Shams passenger and freight railway project.
Increase in ocean freight demand to drive ocean fleet size growth
Egypt’s ocean fleet size recorded a CAGR of 0.8%, rising from 383 in 2012 to 399 in 2017 and is anticipated to post a CAGR of 1.4%, from 404 in 2018 to 428 in 2022. The increase will be due a rise in ocean freight demand; volume recorded a CAGR of 29.4%, from 2.9 million tons in 2012 to 10.5 million tons in 2017. It is anticipated to post a CAGR of 21.3%, from 15.2 million tons in 2018 to 26.1 million tons in 2022. There are 82 ports in Egypt, of which nine are commercial (Alexandria, El-Dekheila, Safaga, East Port Said, Damietta, Port Said, Adabiya, Suez and El-Sokhna), six are general commercial and 67 are specialized.
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