Russia and Egypt agree on industrial zone development in sign of growing economic ties

Russia and Egypt agree on industrial zone development in sign of growing economic ties

Russia and Egypt will today ink an agreement to establish a Russian industrial zone in Port Said, near the Suez

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Photo: Reuters/Alexander Zemlianichenko

Russia and Egypt will today ink an agreement to establish a Russian industrial zone in Port Said, near the Suez Canal.

The two countries have been negotiating the proposed zone since 2014 and its development should see Egypt receive some $7 billion worth of Russian investment, as well as the creation of 35,000 jobs. For Moscow, the industrial zone will provide a foothold for Russian goods to enter the growing Egyptian and African markets.

Today’s agreement reflects warming relations between Cairo and Moscow that have deepened in the past few years. Economically, two-way trade has steadily increased in recent years—Egyptian exports to Russia rose by some 27% in 2017. Militarily, Egypt has increasingly turned to Russia for arms, purchasing fighter jets and air defence systems since 2014, which has coincided with a downturn in US-Egypt bilateral relations.

With Russia isolated by Western sanctions and Egypt coming under increasing pressure for its erosion of democracy, expect ties between Moscow and Cairo to deepen further as both countries struggle economically.