Egypt sells prime land to foreign investors in USD to boost economy

In a strategic move to strengthen its economic standing, Egypt has approved the sale of land plots in eight major cities to 34 foreign companies, with all transactions priced in US dollars. This initiative, greenlighted by the New Urban Communities Authority (NUCA), is part of a broader effort to enhance dollar liquidity in the local market amidst a prolonged currency crunch.

Strategic land sales to boost dollar liquidity

The cabinet announced this decision at its weekly meeting in the New Administrative Capital, highlighting NUCA's approval of land allocations to these companies. The cities involved include New Cairo, New Damietta, New October, Badr, Obour, 10th of Ramadan, New Suez, and Sheikh Zayed. The foreign companies plan to undertake a variety of projects, ranging from commercial and residential developments to industrial and recreational facilities.

Aligning with IMF commitments

This initiative is not just a response to immediate economic challenges but a strategic component of Egypt's commitment to the International Monetary Fund (IMF). As part of an $8 billion loan program backed by the IMF, Egypt aims to rectify economic imbalances, attract foreign direct investment, and empower the private sector. This program also seeks to reduce the government's economic footprint, paving the way for more dynamic private sector participation.

Addressing currency crunch

By selling land in USD, Egypt addresses a critical need for foreign currency liquidity. This approach was previously endorsed in January, reflecting ongoing efforts to manage the country's over two-year struggle with dollar shortages. The land sales are expected to generate significant foreign investment, stimulating various sectors, including commercial, residential, industrial, and more.

Diverse projects to stimulate economic growth

The wide array of projects planned by these foreign entities underscores the potential for substantial economic growth and diversification. From medical and administrative complexes to integrated urban developments and food industries, the influx of foreign capital is poised to catalyze comprehensive economic development across the designated cities.

Long-term economic goals

Egypt's strategy aligns with its broader economic goals, including reducing the debt-to-GDP ratio, projected to decrease to 82.6% by 2025, and further to below 80% by 2027. These targets are part of the fiscal discipline measures agreed upon with the IMF, aimed at ensuring long-term economic stability and growth.

Conclusion: setting the stage for sustained growth

By engaging in this land sale initiative, Egypt not only addresses immediate financial pressures but also sets the stage for sustained economic development. This move signals a robust commitment to economic reform, international collaboration, and the creation of a more resilient and diversified economy.