AD Ports to invest in three Egyptian cruise terminals to boost country’s tourism

Abu Dhabi Ports Group in investing in three cruise terminals in Egypt in a move that is expected to boost the country’s key tourism sector.

The $3 million investment is part of a 15-year concession agreement with the Red Sea Port Authority that covers the Safaga, Hurghada and Sharm El Sheikh ports.

A definitive agreement is expected to be finalised during the first quarter of 2024, AD Ports said on Friday.

As part of the collaboration, AD Ports and the RSPA will provide new services, improve access for cruise operators and add new itineraries in the three ports, in addition to renovating Sharm El Sheikh terminal.

The moves will be key in ramping up the Egyptian economy and AD Ports Group’s cruise business in the Red Sea region, “supporting volumes of cruise passengers and elevating passenger and cruise experiences”, the company said.

“This agreement is a testament to our commitment to fostering tourism in the Red Sea region, as well as strengthening the existing ties between the UAE and Egypt,” said Ahmed Al Mutawa, regional chief executive of AD Ports.

“AD Ports Group is poised to boost cruise tourism in the Red Sea, bringing world-class services and facilities to these ports, while supporting economic growth for Egypt.”

The travel and tourism sector has been a vital source of income for Egypt, the Arab world’s most populous nation, contributing about $32 billion to gross domestic product during 2022 and employing about 2.4 million people, data from Statista shows.

In the same year, international tourist spending exceeded domestic spending for the first time since 2020, when the Covid-19 pandemic stalled economic activity, it added.

In the 2023 fiscal year, which starts in July, tourism revenue on the balance of payments hit a record high of $14 billion, supported by Egypt’s hosting of the Cop27 climate change summit in November 2022.

However, the sector is expected to remain highly sensitive to exchange rate and inflation trends, as well as to the fallout from the Israel-Gaza conflict, S&P Global said in a recent report.

Meanwhile, the Emirates is Egypt’s second-biggest trading partner in the region while the North African country is ranked as the UAE’s fifth non-oil trade partner in the Arab region.