en.Wedoany.com Reported - A new public free zone is set to be established in Egypt's Sohag Governorate, having received preliminary approval from the General Authority for Investment and Free Zones (Gafi).

Mahmoud El Shendweily, Chairman of the Sohag Investors Association, told Al Borsa newspaper that the free zone aims to leverage the province's geographical advantage of direct access to Red Sea shipping hubs, attracting new capital to Upper Egypt and expanding industrial product exports. However, the project's final implementation depends on a comprehensive overhaul of the local aging infrastructure, including the construction of dedicated electricity, water, and natural gas networks.

Cost issues remain a core concern for investors. El Shendweily stated that manufacturers are pushing for the reinstatement of tax exemptions, waivers on overdue social insurance contributions, and lower industrial land prices. He noted that industrial land prices have risen from 200 Egyptian pounds per square meter to 1,100 Egyptian pounds per square meter. While this price is still lower than the 1,900 Egyptian pounds per square meter reported last year, it reflects widespread discontent among manufacturers over soaring land costs, which are slowing new investments.

The Sohag free zone project aligns with the Egyptian government's broader plan to launch four new public free zones by the end of the year. Egypt's existing nine free zones are operating near full capacity, with a utilization rate of 95%. Gafi plans to introduce four new free zones in the cities of 10th of Ramadan, New October, New Borg El Arab, and New Alamein.

In terms of Red Sea shipping, the Saudi Ports Authority (Mawani) has added a new shipping service connecting to Jeddah Islamic Port. The SRS route, operated by UAE shipping company ESL, links the Red Sea hub with India's Mundra Port and Djibouti Port, with a capacity of 2,100 twenty-foot equivalent units (TEUs). This new service adds an India-Red Sea-East Africa loop to Jeddah Port, following the launch last month of the RS1 service connecting Oman's Salalah Port and Djibouti Port, with a capacity of 1,700 TEUs.

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