Siemens has signed energy contracts worth $9bn with Egypt, including one to erect 600 wind turbines with a total generating capacity of 2GW in the Gulf of Suez and west Nile areas.
Egypt requires investment of up to $300bn to "make its people happy"– Abdel Fattah El-Sisi, Egyptian president
In the largest deal in the Munich company’s history, Siemens will also build three natural gas power plants with the aim of increasing Egypt’s power generation capacity by more than half.
The new plants will begin feeding the grid from 2017, and will eventually add up to 16.4GW. The Egyptian government plans to expand wind capacity alone to to 7.2GW by 2020.Â
The deal, which is the largest in Siemens’ history, was witnessed by Egyptian president Abdel Fattah El-Sisi and German vice chancellor Sigmar Gabriel in Berlin last week (pictured).Â
Joe Kaeser, Siemens’ chief executive, said: "With these unprecedented contracts, Siemens and its partners are supporting Egypt’s economic development by using highly efficient natural gas and renewable technologies to create an affordable, reliable and sustainable energy mix for the country’s future."Â Â
Siemens’ Financial Services Division has structured a financing package for the engineer’s role in the contracts, including a tailored guarantee concept. The envisaged loan facilities, supported export credit guarantees, will be provided by international and regional banks.Â
The government of al-Sisi has made the provision of electricity one of its key infrastructure goals. At the Egypt Economic Development Conference held in Sharm El Sheik in March, the president told delegates that he has personally negotiated deals with Siemens and other suppliers to bring forward construction programmes for power stations, and to cut their cost.Â
At that conference, al-Sisi said Egypt required investment of up to $300bn to "make its people happy". More specifically, the government has said it aims to increase economic growth in the country by 6% and decrease unemployment by 10% in the next five years.Â
As well as electricity, Egypt is planning a 1,000km high-speed rail line between Alexandria and Aswan and a $40bn plan to build a million affordable homes.Â
The company will also build a rotor blade manufacturing facility in Egypt’s Ain Soukhna region, which will provide training and employment for up to 1,000 people. The facility is scheduled to go into operation in the second half of 2017.