Infrastructure investment is a key pillar under reforms put forward by the Ministry of Tourism and Antiquity (MoTA) in 2018. These reforms recognise the need to develop existing infrastructure and increase overall capacity. Tourist arrivals have risen steadily in recent years, reaching 12.6m in 2019. Although visitor numbers in the first half of 2020 were impacted by the spread of the Covid-19 pandemic, international tourism is expected to resume growth in 2021.
Public Investment
Identifying the importance of Egypt’s tourism sector as a key economic driver, the government has allocated funds for the restoration of several historical sites. In 2018 the 4300-year-old Tomb of Mehu was made available to the public – 78 years after its discovery – and in 2019 the 4600-year-old Bent Pyramid was opened following extensive restoration works. The site had been closed since 1965. In addition to heritage sites, religious visits have been highlighted as a potential for Egypt’s niche cultural tourism. The Eliahu Hanavi Synagogue in Alexandria opened its doors in January 2020, after receiving LE65m ($4m) in restoration funding from the MoTA.
Restoration efforts are being supported by the private sector, and in 2019 the government announced investment for the renovation of 150 heritage buildings in central Cairo. A 2019 government report suggested there were 351 state-owned historical buildings across Egypt in need of renovation. Such renovations are expected to encourage tourism in central Cairo. As part of its reinvigoration of heritage sites surrounding the capital, the government has invested heavily in two new airports to boost tourism growth. The Capital International Airport will serve the new administrative capital – around 45 km east of Cairo – and alleviate pressure on Cairo International Airport. A second airport situated close to the Great Pyramids, Sphinx International Airport, is set to open in 2021. At a cost of LE300m ($18.5m), the airport will have a capacity of 300 passengers per hour. The government has made security a top priority for the project, installing X-ray devices for passengers and cargo, thermal surveillance cameras and automatic fire alarms.
Private Investment
Construction of the new Grand Egyptian Museum has spurred the private sector to invest in West Cairo, which is expected to become a tourist centre for the capital. Hyatt plans to open the Hyatt Regency Cairo West, a 242-room hotel, next door to the museum, in the fourth quarter 2020; however, this may be delayed due to the Covid-19 pandemic. Around 60% of Cairo’s hotels have a five-star rating, and 90% of those establishments are affiliated with international brands. There is significant potential for the development of the mid-market hotel sector as the MoTA strives for greater visitor diversification.
In November 2019 the Egyptian Hotel Association announced total anticipated investment of $800m for the construction of 8000 hotel rooms in 2020; however, as of June 2020 this had been delayed. As well as new developments in Cairo, a number of international hotel chains have announced large-scale investments. The MoTA’s 2018 tourism reform strategy focuses on hotel infrastructure development, with the objective of increasing Egypt’s 89,993 hotel rooms to 238,114 by 2030, completing existing works and fostering the construction of an additional 183,000 rooms.
In January 2020 Marriott International signed an agreement to open a St Regis hotel in the new administrative capital. The existing Almasa Royal Palace will be rebranded to a St Regis, providing 270 rooms, 90 suites, 60 apartments and 14 villas. Furthermore, Marriott plans to open four hotels across Egypt before 2024.
The international hotel giant Hilton also has big plans for Egypt, and announced the construction of 2390 hotel rooms across the country in 2017. With an expected completion date of 2022, these projects will increase Hilton’s Egyptian portfolio by around 40%. Hilton will expand to Cairo, Port Said, Ain Sokhna and New Damietta, and has projects already under way.
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