Penning Deals to Operate Russian Industrial Zone in Egypt

 Russian President Vladimir Putin (2nd L), his Egyptian counterpart President Abdul Fattah al-Sisi (2nd R) and Russia’s Defense Minister Sergei Shoigu (L) meet onboard a guided missile cruiser at the port of Sochi, August 12, 2014. REUTERS/Alexei Druzhinin/RIA Novosti/Kremlin
Russian President Vladimir Putin (2nd L), his Egyptian counterpart President Abdul Fattah al-Sisi (2nd R) and Russia’s Defense Minister Sergei Shoigu (L) meet onboard a guided missile cruiser at the port of Sochi, August 12, 2014. REUTERS/Alexei Druzhinin/RIA Novosti/Kremlin
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Penning Deals to Operate Russian Industrial Zone in Egypt

 Russian President Vladimir Putin (2nd L), his Egyptian counterpart President Abdul Fattah al-Sisi (2nd R) and Russia’s Defense Minister Sergei Shoigu (L) meet onboard a guided missile cruiser at the port of Sochi, August 12, 2014. REUTERS/Alexei Druzhinin/RIA Novosti/Kremlin
Russian President Vladimir Putin (2nd L), his Egyptian counterpart President Abdul Fattah al-Sisi (2nd R) and Russia’s Defense Minister Sergei Shoigu (L) meet onboard a guided missile cruiser at the port of Sochi, August 12, 2014. REUTERS/Alexei Druzhinin/RIA Novosti/Kremlin

The Ministry of Industry and Trade of the Russian Federation has announced that the first eight firms have penned partnership deals to operate the Russian industrial zone in Egypt.

The step coincides with a time when economic and commercial ties are developing between Russia and Egypt, knowing that Russian President Vladimir Putin visited Cairo in December in 2017 and Egyptian President Abdul Fattah el-Sisi visited Russia in October last year.

Chairman of Egypt's Suez Canal Authority Mohab Mamish signed a memorandum of understanding with Afanasiev Anton, General Director of Economic Zone at Dubna, to cooperate in the field of transforming and exchanging expertise between the two.

Russian Minister of Industry and Trade Denis Manturov said that the first portfolio of eight agreements of intent with interested companies would be signed by Russian Export Center in the Russian industrial zones.

Manturov added that the industrial zone is not only a promising project to develop economic and commercial ties between countries but also a multi-functional station to export Russian industrial products to MENA markets.

The Russian side expects the project of establishing an industrial zone in Egypt to take 13 years, given that the first Russian company will commence its operations in the first phase in 2019. While Russian firms that would operate there will be able to manufacture products of value worth USD3.6 billion per year starting 2026.

The Russian industrial zone is set to be established on more than a 5-million-square meter plot of land in Port Said, with the first phase to cost 190 million dollars.



Saudi Transport, Logistics Sector Set for 10% Growth in Q2

An investor monitors a trading screen at the Saudi financial market in Riyadh. (AFP)
An investor monitors a trading screen at the Saudi financial market in Riyadh. (AFP)
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Saudi Transport, Logistics Sector Set for 10% Growth in Q2

An investor monitors a trading screen at the Saudi financial market in Riyadh. (AFP)
An investor monitors a trading screen at the Saudi financial market in Riyadh. (AFP)

As Saudi companies start reporting their Q2 financial results, experts are optimistic about the transport and logistics sector. They expect a 10% annual growth, with total net profits reaching around SAR 900 million ($240 million), driven by tourism and an economic corridor project.

In Q1, the seven listed transport and logistics companies in Saudi Arabia showed positive results, with combined profits increasing by 5.8% to SAR 818.7 million ($218 million) compared to the previous year.

Four companies reported profit growth, while three saw declines, including two with losses, according to Arbah Capital.

Al Rajhi Capital projects significant gains for Q2 compared to last year: Lumi Rental’s profits are expected to rise by 31% to SAR 65 million, SAL’s by 76% to SAR 192 million, and Theeb’s by 23% to SAR 37 million.

On the other hand, Aljazira Capital predicts a 13% decrease in Lumi Rental’s net profit to SAR 43 million, despite a 44% rise in revenue. This is due to higher operational costs post-IPO.

SAL’s annual profit is expected to grow by 76% to SAR 191.6 million, driven by a 29% increase in revenue and higher profit margins.

Aljazira Capital also expects a 2.8% drop in the sector’s net profit from Q1 due to lower profits for SAL and Seera, caused by reduced revenue and profit margins.

Mohammad Al Farraj, Head of Asset Management at Arbah Capital, told Asharq Al-Awsat that the sector’s continued profit growth is supported by seasonal factors like summer travel and higher demand for transport services.

He predicts Q2 profits will reach around SAR 900 million ($240 million), up 10% from Q1.

Al Farraj highlighted that the India-Middle East-Europe Economic Corridor (IMEC), linking India with the GCC and Europe, is expected to boost sector growth by improving trade and transport connections.

However, he warned that companies may still face challenges, including rising costs and workforce shortages.