Saudi-Egyptian Electrical Connection Improves Power Supply in the Region

The sun sets behind high-voltage power line poles (Reuters)
The sun sets behind high-voltage power line poles (Reuters)
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Saudi-Egyptian Electrical Connection Improves Power Supply in the Region

The sun sets behind high-voltage power line poles (Reuters)
The sun sets behind high-voltage power line poles (Reuters)

Mohamed Farouk, Vice Chairman of El-Gammal Group, the company implementing the Egypt-Saudi Arabia electrical interconnection project, stated that the initiative will significantly enhance electricity supply in the region and reduce power outages that many Arab countries have been grappling with.

During the past summer, at least seven Arab countries, including Kuwait—a nation known for its oil wealth—experienced recurring power cuts due to record-breaking heatwaves.

In an interview with Asharq Al-Awsat from his office in Cairo, Farouk explained that the electrical interconnection, set to launch between April and May next year, will bolster the reliability of power stations in both Egypt and Saudi Arabia.

He added that this project is expected to serve as a cornerstone for broader Arab electrical integration.

The initiative originated from a cooperation agreement signed by Egypt and Saudi Arabia in 2012, with an estimated cost of $1.8 billion, of which $600 million is Egypt’s share. Funding has been provided by the Kuwait Fund for Arab Economic Development, the Arab Fund for Economic and Social Development, the Islamic Development Bank, and internal resources from the Egyptian Electricity Transmission Company.

This project represents the first high-voltage current exchange initiative in the Middle East and North Africa. It spans from Badr City in Egypt to Madinah, passing through Tabuk in Saudi Arabia. It includes the construction of three high-voltage conversion stations: two in Saudi Arabia, located in Madinah and Tabuk, and one in Badr, east of Cairo. These stations will be interconnected by overhead transmission lines stretching approximately 1,350 kilometers, along with 22 kilometers of underwater cables across the Gulf of Aqaba.

Farouk also announced that El-Gammal Group has earmarked $200 million to establish a polyethylene manufacturing complex in Saudi Arabia, with completion planned by the end of next year.

The company is targeting a 25% market share in Saudi Arabia’s polyethylene sector within three to four years.

“We have obtained the necessary licenses for the factory and are currently in the process of selecting the most suitable location,” Farouk explained.

The group is actively engaged in infrastructure and energy projects and produces a significant portion of the materials used in these endeavors, such as pipelines for oil and gas projects. One of its notable achievements includes the monorail project, where it integrated all stations with the Greater Cairo electricity distribution network.

Farouk emphasized the significance of the Saudi market, describing it as “large and promising.”

He added: “We aim to establish a strong presence in Saudi Arabia, both in the general contracting and manufacturing sectors.”



US Economy Grows at 3.1% Pace in 3rd Quarter, an Upgrade from Previous Estimate

FILE PHOTO: A sailboat passes by the Statue of Liberty in New York Harbor, in New York City, US, September 20, 2024.  REUTERS/Brendan McDermid/File Photo
FILE PHOTO: A sailboat passes by the Statue of Liberty in New York Harbor, in New York City, US, September 20, 2024. REUTERS/Brendan McDermid/File Photo
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US Economy Grows at 3.1% Pace in 3rd Quarter, an Upgrade from Previous Estimate

FILE PHOTO: A sailboat passes by the Statue of Liberty in New York Harbor, in New York City, US, September 20, 2024.  REUTERS/Brendan McDermid/File Photo
FILE PHOTO: A sailboat passes by the Statue of Liberty in New York Harbor, in New York City, US, September 20, 2024. REUTERS/Brendan McDermid/File Photo

The American economy grew at a healthy 3.1% annual clip from July through September, propelled by vigorous consumer spending and an uptick in exports, the government said in an upgrade to its previous estimate.
Third-quarter growth in US gross domestic product — the economy's output of goods and services — accelerated from the April-July rate of 3% and continued to look sturdy despite high interest rates, the Commerce Department said Thursday. GDP growth has now topped 2% in eight of the last nine quarters.
Consumer spending, which accounts for about two-thirds of US economic activity, expanded at a 3.7% pace, fastest since the first quarter of 2023 and an uptick from Commerce’s previous third-quarter estimate of 3.5%, The Associated Press reported.
Exports climbed 9.6%. Business investment grew a lackluster 0.8%, but investment in equipment expanded 10.8%. Spending and investment by the federal government jumped 8.9%, including a 13.9% surge in defense spending.
American voters were unimpressed by the steady growth under Democratic President Joe Biden. Exasperated by prices that remain 20% higher than they were when an inflationary surge began in early 2021, they chose last month to send Donald Trump back to the White House with Republican majorities in the House and Senate.
Trump will inherit an economy that looks healthy overall. The unemployment rate remains low at 4.2% even though it is up from the 53-year low 3.4% reached in April 2023. Inflation hit a four-decade high 9.1% in mid-2002. Eleven interest rate hikes by the Federal Reserve in 2022 and 2023 helped bring it down — to 2.7% last month. That is above the Fed's 2% target. But the central bank still felt comfortable enough with the progress against inflation to cut its benchmark rate Wednesday for the third time this year.
Within the GDP data, a category that measures the economy’s underlying strength rose at a solid 3.4% annual rate from July through September, an upgrade from the previous estimate and up from 2.7% in the April-June quarter. This category includes consumer spending and private investment but excludes volatile items like exports, inventories and government spending.
Wednesday’s report also contained some encouraging news on inflation. The Federal Reserve’s favored inflation gauge — called the personal consumption expenditures index, or PCE — rose at just a 1.5% annual pace last quarter, down from 2.5% in the second quarter. Excluding volatile food and energy prices, so-called core PCE inflation was 2.2%, up modestly from the previous estimate but down from 2.8% in the April-June quarter.
Thursday's report was the Commerce Department's third and final look at third-quarter GDP. It will publish its initial estimate of October-December growth on Jan. 30.