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Cairo to build a $2 billion power plant
Cairo will be constructing a $2 billion power plant in Ain Sokhna on the Gulf of Suez. The plant will provide 1,300 megawatts (MW) of steam power and will be the first in Egypt to use supercritical technology. A similar venture will increase the overall efficiency of the plant allowing a faster response to the change in demand while reducing emissions. The project will be financed by two loans and several funds by Arab contributors. The first loan amounting to $450 million is signed with the African Development Bank and will cover 22 percent of the cost of the project, while the second loan will be given by the World Bank and will amount to $600 million. The remaining funding for the project will come from the Egyptian Electricity Holding Company (EEHC), the Arab Fund for Economic & Social Development (AFESD), and the Kuwaiti Fund for Arab Economic Development (KFAED).
Saudi company to sign $2.5 billion power project
The Saudi Electricity Company (SEC) will sign a deal with both Korea Electric Power corporation and the local Acwa Power International for the $2.5 billion Rabigh independent power project (IPP). The SEC stated that it will announce the pre-qualified bidders for the PP11 IPP power project in Riyadh by the end of March. The SEC changed the shareholding structure of the project, giving a 51 percent stake for the winning bidder, while the remaining 49 percent will be sold in an initial public offering (IPO). The old ratio had been 40:60, giving the bulk to individual shareholders. In another economic highlight, inflation in Saudi Arabia is excepted to continue falling this year. Consumer prices retreated in February to 6.9 percent from 7.9 percent in the previous month.
UAE inflation to drop in 2009
The key drivers of inflation in 2008 — liquidity, cost of housing and cost of food — are not expected to increase this year. Therefore, inflation in the UAE is expected to ease to two to three percent in 2009. Next year is expected to be the year of recovery from the financial crisis for the Gulf, Asia and Africa, which are relatively less affected than the US, UK and the Eurozone, where the recovery is expected to take a longer period. Moreover, the UAE is putting into action the lessons learned from the recession. For example, the other side of the downturn in the UAE’s real estate sector could be positive for the economy as funds and human resources that were primarily geared for the real estate sector could now be used in other productive industries. In addition, the fiscal and monetary measures taken by the UAE authorities, in the form of direct liquidity injections, has boosted the confidence of investors locally and regionally. This confidence is being confirmed by the current satisfactory levels of credit growth that range between 10 percent to 15 percent, after reaching 49 percent last June.
