How Egypt is building its infrastructure future on public-private partnerships

Egypt’s infrastructure sector ranks among the fastest-growing in the Middle East, underpinned by an ambitious pipeline spanning transport, energy, logistics and urban development. The market, valued at over $51 billion, is projected to surpass $70 billion by 2031 as the country accelerates investment under Egypt Vision 2030, a national strategy centered on economic diversification, sustainable development, and attracting foreign capital.

Public-private partnerships have become a defining mechanism for financing and delivering major infrastructure projects over the past decade. The model has seen landmark developments, including the New Administrative Capital, the Benban Solar Park, and the expansion of Sokhna Port, while widening the scope for private-sector participation across strategic sectors.

The momentum shows little sign of slowing. According to Egypt’s Ministry of Finance, nine PPP projects worth around $1.1 billion were in the offering stage during 2025-2026, with a further 10 projects valued at approximately $740 million being prepared for approval. In 2024 alone, the government signed 10 PPP contracts totaling around $400 million in investment. 

Public-private partnerships took center stage at this year’s Big 5 Construct Egypt, where a session examining what it will take to accelerate Egypt’s next phase of infrastructure growth drew together senior voices from across the sector.

DELAYS AND HURDLES

Despite the growing role of PPPs in Egypt’s infrastructure sector, project delivery remains a significant challenge. Dr. Mohamed Mandour, Chairman and Managing Director of The Arab Contractors for Facility Management, identified funding constraints, labor shortages and supply chain disruptions as the three primary hurdles.

According to Mandour, financing remains the biggest obstacle, with funding shortages continuing to delay projects. He also highlighted the shortage of skilled labor as a growing concern.

“We have seen a massive migration of skilled labor to projects in the Gulf and neighboring countries; even the European market is attracting skilled technical labor from Egypt. This shortage of skilled technical labor also impacts the speed and quality of project execution,” he said.

Supply chain disruptions have further affected project timelines, particularly for developments reliant on imported equipment and components. 

“Major components of these projects involve spare parts, supplies, and electromechanical systems, most of which are imported. A massive shortage occurred in supply chains due to ongoing wars, which affected navigation in the Suez Canal and the Red Sea, causing major delays in the delivery of foreign components for national projects or most existing projects in Egypt.”

Dr. Raymond Ahdy, Chief Executive Officer of Wadi Degla Developments, shared his perspective as a real estate investor, identifying the gap between planning and execution as a major cause of delays, citing widespread cost overruns and schedule slippages across the industry.

“There is always a gap between planning and execution. This is the first thing that causes a project to be born late.”

He stressed the importance of thorough project planning, clear legal frameworks and well-defined financing structures from the outset. Factoring in risks such as inflation and currency devaluation early in the process, he said, helps projects remain financially sustainable and better prepared to navigate unforeseen challenges.

Risk management also emerged as a critical issue. 

In an exclusive interview, Eng. Amr Elnaggar, Director of the PPP Unit at The Arab Contractors, expanded on the topic offstage, noting the importance of anticipating challenges across the entire lifecycle of infrastructure and PPP projects. He stressed that effective risk allocation begins at the earliest stages of project planning and design and is supported by detailed feasibility studies, simulations, and financial modeling.

“The first element is risk allocation from the very beginning.”

He explained that project teams assess risks at every stage of development, from design and construction to operations, maintenance, and revenue collection, while evaluating logistical, geopolitical, weather-related, and financial risks. 

Financial indicators and project viability assessments are also used to ensure long-term sustainability. According to Elnaggar, government support remains essential to attracting private investment and reducing uncertainty.

“Government encouragement and guarantees in the event of changes in currency exchange rates or force majeure issues are necessary.”

Dr. Nedal El Nazer, Vice President of the Egyptian Court of Cassation, noted that PPP projects are becoming more complex and spanning decades.

“The issue with PPP projects is that they are long-term; the project’s life cycle is long and can extend to 25 or 30 years.”

In an exclusive interview, he argued that many delays stem from contracts that are often too rigid to adapt to changing circumstances. In his view, infrastructure agreements should allow for renegotiation, risk reassessment and the redistribution of responsibilities as political, financial and economic conditions evolve. 

He also pointed to exchange-rate fluctuations as a key challenge that can significantly affect long-term project performance and contractual obligations.

LEGALITY AND DISPUTES

Legal risk sits at the heart of long-term infrastructure delivery. “Infrastructure projects generally are characterized by a long project life cycle, which exposes them to many variables and risks, whether political risks, economic risks, or environmental risks,” said El Nazer. “All of these risks lead to conflicts within the project, increased project costs, and legal disputes that may not appear at the start of the project but begin to surface as it progresses.”

Legal disputes remain a major cause of project delays and suspensions, often stemming from contractual loopholes discovered during implementation. “The biggest issue facing infrastructure projects is their suspension due to legal disputes. Unfortunately, the parties do not discover these legal disputes until after drafting the contract and entering the execution phase, at which point they uncover legal loopholes. They then resort to arbitration to resolve these disputes,” he said.

Stronger legal frameworks, clearer risk allocation and more precise contract drafting, he argued, can help reduce disputes and accelerate delivery, while alternative dispute resolution mechanisms can help maintain project continuity and avoid lengthy arbitration proceedings.

El Nazer also stressed the importance of adopting more sophisticated dispute-resolution frameworks in infrastructure projects, arguing that many stakeholders rely too heavily on arbitration and should instead pursue alternative mechanisms to preserve project momentum.

“We always resort to the ultimate solution, which is going to arbitration.”

He advocated for a multi-tiered approach that incorporates direct negotiation, mediation, and dispute boards before disputes escalate into formal proceedings. According to El Nazer, these mechanisms can be tailored to each project’s specific needs and used to resolve issues more efficiently throughout the project lifecycle.

He also highlighted the widespread use of FIDIC contracts in major infrastructure projects, noting that they provide flexible frameworks that contracting parties can adapt.

“They are not rigid contracts. They are flexible contracts that allow us to adopt what suits us.”

El Nazer explained that parties can modify contractual provisions, adjust timelines and introduce mechanisms for renegotiation or repricing when necessary. He added that dispute board decisions can also be structured to carry varying degrees of authority depending on what the parties agree to, helping strengthen project continuity while maintaining contractual certainty.

TECHNOLOGY AND DIGITIZATION

Eng. Gamal Ramzy, Chief Technology Officer at the Administrative Capital for Urban Development (ACUD), identified technology as a key enabler of faster, more efficient infrastructure delivery, arguing that digital tools can help reduce delays across planning, construction, and operations. 

He highlighted the role of shared digital platforms, GIS mapping, BIM models, and digital twins in improving coordination among stakeholders, reducing design conflicts, and minimizing costly rework. Real-time access to project data, he said, also strengthens transparency and accountability by allowing all parties to monitor progress, delays and responsibilities.

“The most critical element for managing any project is the volume of information about that project,” he said.

Beyond construction, digital systems can improve asset management and support predictive decision-making, helping operators anticipate risks and maintenance requirements before they arise. “Technology is indeed the solution. It is the solution to accelerate the pace, we won’t say prevent, but reduce the delay in project execution,” said Ramzy.

The rise of technology is also creating new legal challenges, particularly as AI becomes more widely adopted across the sector. El Nazer stressed that AI should be viewed as a support tool rather than an autonomous decision-maker. “AI does not have a legal personality; it is an assisting tool. The law grants legal personality only to natural persons and legal entities.”

“Technology is inevitable, and contracts in the contracting field in general, and infrastructure projects in particular, must keep pace with technology,” he said, warning against treating AI-generated outputs as infallible and emphasizing the need for human oversight. “There must be human review and human supervision over AI tools.”

According to El Nazer, determining liability when AI contributes to errors remains legally unclear, while existing regulations continue to lag behind technological developments.

“The question of determining liabilities is still not clear in legal aspects.”

He also notes that clearer legal frameworks will be needed to define responsibilities and accountability as AI adoption expands across infrastructure projects.

“Without legal regulation and general rules, the use of AI will outpace us,” he stated. “Technology is always faster than legislative and legal development. However, AI must be regulated in a precise legal manner to define liabilities clearly.”

SUSTAINABILITY IS KEY

Sustainability has moved from aspiration to requirement. Environmental considerations, speakers argued, must now be integrated throughout the entire project lifecycle, from concept through to long-term operations.

“The matter is no longer optional; it is not a matter of whim, and it is not just something we choose. It is now an essential part from the very first planning stages of the project, from the absolute beginning of the concept,” said Ahdy, who argued that sustainability must be embedded across construction materials, design methodologies, facility management and operations.

“This ensures that the lives of the people managing the project become easier, cheaper, and ultimately beneficial for our environment,” he added.

He also highlighted the financial case, noting that institutions such as the European Bank for Reconstruction and Development offer more favorable financing terms for projects that incorporate sustainability criteria. That research shows investments in sustainable design can generate significant long-term savings.

On the contractual dimension, Elnaggar said sustainability standards should be integrated during the feasibility and planning stages, with compliance later reflected through contractual obligations. “When we start the study and the feasibility study, we take into consideration the criteria for applying sustainability standards in the project. We could even use modern systems like green building, serving the urban transition, or the green transition, so that when the project comes out, it is sustained.”

El Nazer argued that Egypt has already taken important institutional and legal steps to support sustainable infrastructure investment. “It established the PPP unit in the Ministry of Finance, set up economic courts, and is a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards.” These measures, he says, help strengthen investor confidence, attract international partnerships, and support a balanced contractual relationship between the public and private sectors, creating an environment conducive to long-term infrastructure development.

FUTURE OUTLOOK

Contractual flexibility will be critical to sustaining momentum. Frameworks need to serve both government entities and private-sector partners, with mechanisms that allow for renegotiation over the life of a project. Given that infrastructure projects typically span 25 to 30 years and are subject to shifting political and economic conditions, provisions for periodic reviews of pricing and obligations every 3 to 5 years were deemed essential.

“The primary goal of infrastructure projects is continuity, not dispute,” said Dr. El Nazer.

“What is already being achieved on Egyptian soil today is a leap in itself, a breakthrough that hasn’t happened in decades in Egypt,” said Eng. Elnaggar. Egypt is now focused on accelerating project delivery to execute a larger number of projects within shorter timeframes, with the ambition of meeting, and potentially exceeding, the targets set under Egypt Vision 2030 while laying the groundwork for its longer-term 2050 goals.