Wanted: Investor for 94 ha desert land development in Siwa oasis, Egypt

A special call for a special project. In the Siwa Oasis in Egypt, a Dutch/Egyptian family has 94 hectares of desert land available. This special location offers interesting perspectives for different forms of horticulture. Also the Egyptian government has an interest in promoting investments in the area. The owner, a Dutchman who has been living in Egypt for decades, is looking for someone with a horticultural understanding and who, together with himself, sees the possibilities here to build a successful business.

Below is a detailed explanation of the area/project, prepared by Cornelis Hulsman. For more information, he can be contacted (details at the bottom).



Introduction
The location has excellent connections by good roads and an airport. Siwa is a peaceful oasis. Cheap labor is ample. There is a recently made report on soil and groundwater. Olive trees cover an area of 1000m2. The soil quality is diverse and can be used for olive trees, palm trees, greenhouses and many other products. The Egyptian government wants to promote investment in the Siwa oasis, see also ‘Boerderij’ of 21 April 2017. Owner is a Dutchman living in Egypt with an Egyptian family outside of Egypt. We are looking for one or more investors with knowledge of crops that are possible in Siwa and who, together with us, can develop this project.

Location
The 94 ha is next to a brand new international road in the Siwa oasis, 300 km south of Marsa Matrouh on the north coast of Egypt. There are good connections to Alexandria (550km) and Cairo (750km). More roads are being built which will lessen the distance to Cairo with an estimated 200 km. The land parcel to be developed is approximately 30 km from Siwa military airport, which can also be used by individuals. There are no regular passenger flights to Siwa but private airlines and cargo planes use the airport. There are no refrigeration facilities at Siwa Airport, but those are at Alexandria and Cairo airports.

Climate in Siwa
Siwa is warm to hot and dry. The average annual rainfall is 9.9 mm. The relative humidity is 51%. Between 20 May and 25 September, the daily average temperature is 35°C. The hottest day is July 31 with an average temperature of 38°C. Between 28 November and 4 March, the average temperature during the day is 22°C. The coldest day of the year is January 29 with a temperature between 6°C and 18°C during the day. Night frost occurs very rarely and if it occurs it is during a very short period. (weatherspark.com)

Population
Siwa is approximately the size of the Northeast Polder (Netherlands) and has a population of approximately 30,000 people speaking Arab and Siwi, a Berber language related to Berber languages in North Africa. Many people speak English as second or third language. There are about 50 Europeans living in Siwa more or less permanently. Among them are retired people who have come for the nature, Siwa's history and the climate, but also people who have set up their own business. A number of non-Egyptian retirees leave Siwa during the hot summers. The residents of Siwa are very hospitable but also conservative Muslim. That implies a ban on drinking alcohol. There is a small, non-Siwa-based Christian presentation consisting of Christian Egyptians and some non-Egyptians.

Labor
A daily worker in Siwa is unskilled and is paid about 5 Euro a day on a daily basis. Workers are easily found in the nearby village of Abu Sherouf. Higher skilled staff can be found but if very specific knowledge is needed, this will rather come from Cairo or Alexandria. The salary of a young graduate agricultural engineer starts at 150 Euro per month. More advanced equipment will have to come from Cairo or Alexandria.

Construction costs
In Siwa it is possible to build a three-room house of 150-200 m2 with sanitary facilities for about 10,000 euros. In Siwa lives an experienced British architect who can help with the drawings and construction. Business buildings also cost a lot less than in the Netherlands.

Facilities
Siwa has primary and secondary schools and a hospital. All basic amenities are available but as soon as more specialized facilities are needed, one has to go to Marsa Matrouh, Cairo or Alexandria.

Safety
After the 2011 revolution, there has been unrest everywhere in the country except in Siwa. There have been no violent crimes or terrorist attacks in the oasis since this revolution. The negative Dutch travel advice regarding Siwa is controversial. This is probably due to the fact that Siwa is 50-70 km from the Libyan border, but that border has been hermetically sealed since 2014. In addition, on the Libyan side the Egypt-friendly General Haftar is in power. Great Britain, Austria and some more countries have milder travel advice on Siwa. Christian businessman Mounir Neamatallah owns several hotels and a lot of land in Siwa and is one of the largest investors, who regularly takes diplomats from different Western countries to Siwa to show them the peacefulness of this oasis. The Center for Arab-West Understanding of Cornelis Hulsman has written an alternative travel advice that includes advice of the Egyptian police and they state that Siwa is a safe area. The authority of the Egyptian government is limited in Siwa. Siwa has a tribal society where tribal chiefs act as mediators when this would be needed. This system works well, also for foreigners living in Siwa.

Strong Dutch ties
The work on the 94 ha land started in 2007 by a Dutch/Egyptian family. The Dutchman, Cornelis Hulsman, is a sociologist and came to Egypt for the first time in 1976. Hulsman has excellent connections in Egypt in general and in Siwa in particular through his prolonged stay in Egypt. Hulsman is married to an Egyptian woman. Her family is willing to invest in this land but they live in the Netherlands and in Canada.

In 2007, the family joined with American professor Dr. Ralph Berenger for the development of this land because Berenger was a Kenaf expert. Kenaf is a fiber product that only has value if it can be grown in an industrial volume. Kenaf pulp can replace paper pulp in Egypt that has been imported for decades at high prices. However, Berenger left Egypt in 2008 for personal reasons. The family then planted 4.2 ha of olive trees. (See also: https://siwafarms.wordpress.com/). Now Egyptian authorities are asking to develop the remaining 90 hectares.

Economic potential
The country has a good potential for solar and wind energy. The Egyptian Desert Research Center researched soil and groundwater in February 2017. There are large water supplies with a ppm between 1100 and 1300. The land is rolling gently and has high concentrations of surface salt that can be removed, and partly has a rocky surface. The land is suitable for salt resistant plants, greenhouses, agri-industry and buildings such as homes and, for example, a conference center. However, the government regulation must be taken into account and this desert land is destined to be used for agriculture, so the main objective must be agriculture or horticulture.

The Egyptian government does everything to encourage investment in Egypt
The unrest that followed the 2011 revolution caused major economic problems for Egypt. However, the turmoil in the big cities completely passed the remote Siwa oasis that has remained an oasis of tranquility for all those years.

The government focuses on large mega projects, including in agriculture and horticulture. The IMF approved a USD 12 billion provision on November 11, 2016. For these funds to be released, Egypt must make important economic reforms. This includes the halving of the value of the Egyptian pound, thus making foreign investment much more interesting. Since May 2017, a new investment law has been implemented which makes investments much easier and grants those new companies a 10-year tax exemption. The government further wants to cultivate approximately 600,000 hectares of desert land and encourages companies to implement this. The government intends to cultivate approximately 12,000 hectares of desert land in the Siwa oasis. On June 1, 2017, the Dutch Water Partnership organized an Egypt platform to inform Dutch companies about opportunities in Egypt. ‘Boerderij’ published an article titled ‘Egyptian oasis smiles for investors.’ on April 12, 2017

Legal incentives for investment
Most land in the desert around Siwa has been purchased on a wada'iyat basis, which is a contract that gives the entrepreneur the right to develop the land but it is not full ownership. Before the new investment law came into effect, the entrepreneur first had to show that he/she had fully greened the land with permanent plants (ie trees) before he/she could get the full ownership document. With the new investment law of 2017, the entrepreneur must submit a plan to a governor (province) how he/she wants to use the land. If the government approves this plan, the entrepreneur is protected in the execution of this plan. If the plans were indeed implemented as approved, the entrepreneur receives the full ownership of the land which would push up the value and sales of the land, if so required, would be easy.

Accountant and Auditing
The family works with the reputed audit firm of Mossad Ebeid and the highly experienced accountant Adel Rizkallah, who both have a lot of experience with foreign companies. Ebeid and Rizkallah are Egyptian Christians.

Trainees and volunteers
Hulsman is the general director of the Center for Intercultural Dialogue and Translation (CIDT) in Cairo and has a very large international network of contacts with churches, Christian organizations and educational institutions. On this basis, he can receive international volunteers and trainees in Egypt. They can contribute to the development of parts of this project.

Weakness is in the technical management of the cultivation
The Dutch/Egyptian family of Hulsman has no experience in the agriculture and/or horticulture. Hulsman lives in Cairo and visits Siwa about once per month. The family realizes that this lack of experience is a weakness for setting up the cultivation on a professional basis. One option is to employ a qualified manager but another and better option is to look for partners who can invest but more specifically can also bring in knowledge and management for the cultivation.

Suggested cooperation
The cooperation could include the following: the Dutch/Egyptian family invests in the infrastructure needed for professional agricultural or horticultural development. The partner that is sought will then contribute to investments in plants and arrange the marketing of the products. The agreement is preferably entered into for a period of ten years or more.

For more information, please contact Cornelis Hulsman:
T: +31 (0)703310566 (Netherlands)
T: +20 (0)1005684877 (Egypt)
E: kshulsman@yahoo.com

Reservation: This information text has been prepared as carefully as possible, but no rights can be derived thereof. In case of interest, much more research will be undertaken for which Hulsman and his family will provide all the support.


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