CAIRO – 28 July 2024: In a bid to boost the tourism sector, the government recently approved a new Egyptian Pound 50 billion initiative for the construction and operation of new hotel rooms, including the expansion of existing projects and the conversion of closed buildings into hotel facilities.
According to an official Cabinet statement, these expansions are expected to significantly strengthen the national economy and generate $1 billion to $2 billion in annual revenue, excluding other taxes.
The funding is intended to accelerate investment in construction and finishing efforts and is subject to prior approval from the Ministry of Tourism and Antiquities.
The statement added that the initiative is in line with the Ministry of Tourism and Antiquities’ strategic vision to increase Egypt’s hotel capacity by 240,000-250,000 rooms and attract 30 million tourists.
The loans are subject to several conditions, including the maximum loan limit. Companies will be limited to EGP 1 billion for a single company, or EGP 2 billion for a client and its affiliates involving up to two banks.
The plan will prioritize funding hotel room expansion in key areas including Luxor, Aswan, Greater Cairo, the Red Sea, South Sinai, Sharm El Sheikh, Taba, Nuweiba and Dahab.
Applications for this initiative will be accepted one month from the start date and will be accessible for 12 months.
Under these terms, companies will receive subsidies from the Ministry of Finance to cover the interest rate differential and will benefit from a reduced interest rate of 12 percent on a tapering basis, which is intended to encourage the rapid deployment and start-up of new hotel rooms.
The initiative is expected to directly and indirectly create around 45,000 new job opportunities and contribute to the government’s efforts to reduce unemployment through increased private investment.
The government stressed that the funds will not be used to repay existing debts in the banking sector, and will instead focus on expanding Egypt’s tourism infrastructure.
The initiative also supports the development of new tourism products that utilize Egypt’s cultural heritage and historical sites.
