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CAIRO, April 10 -- China's Xinxing Ductile Iron Pipes Co., Ltd. (Xinxing Pipes) has signed a land lease contract with Egypt-TEDA SEZone Development Company to build a new factory in the China-Egypt TEDA Suez Economic and Trade Cooperation Zone.

The signing ceremony held on March 27 was attended by Egyptian Prime Minister Mostafa Madbouly, Suez Canal Economic Zone Chairman Waleid Gamaleldien, and other senior Egyptian officials.

-- Filling in industrial gap

It is learned that the project will cover an area of about 270,000 square meters, with a total investment of 145 million U.S. dollars and a production capacity of 250,000 tonnes of ductile iron pipes per year.

This project, mainly meeting the markets' needs in the Middle East, Africa, and Europe, is the first overseas production base of Xinxing Pipes, and is expected to bring nearly 200 million U.S dollars foreign currency to Egypt, said Ma Ye, head of the Egyptian project of Xinxing Pipes.

In addition, the project will also provide more than 500 local jobs and improve local workers' technical skill, Ma added.

Cao Hui, executive director of Egypt-TEDA SEZone Development Company, said that the signing is not only of great significance to the cooperation zone, but also will help fill in the industrial gap in Egypt's ductile iron pipes sector, enhance the development and supply capacity of Egypt's local pipelines, and improve the technical level and the international competitiveness of  Egypt's local pipeline industry.

-- Why Egypt?

Building factory in Egypt is not only a big step for Xinxing Pipes to transform and upgrade towards the level of first-class international enterprise, but also a practice in response to the Belt and Road Initiative as a leading iron-pipe company in the world, Ma said.

The underconstruction of many infrastructures in cities such as New Administrative Capital, New Cairo, and October 6 City and a large number of desalination, sewage treatment projects will bring Egyptian pipeline sector unprecedented development opportunities, especially under the Decent Life Initiative launched by Egyptian President Abdel-Fattah al-Sisi on January 2, 2019.

Lower manufacturing costs, geographic advantage and the trade agreements between Egypt and Europe Union will expand the profit margin of Xinxing Pipes, according to Ma.

Egypt's natural gas, water and electricity are relatively cheap, labor costs are inexpensive, and it is close to the target market in Europe, the Middle East and Africa, which means lower freight, Ma said.

-- Broad prospect

At present, the project is at the phrase of preparing for all kinds of work before construction.

As for the future vision of the Egyptian project, Ma said that Xinxing Pipes will actively and continuously promote the construction of the project and strive to achieve production and efficiency as soon as possible.

"At the same time, we should seize the growing international market demand and policy opportunities, give full play to the competitive advantages of middle-and high-end products to increase our market share, to consolidate the leading position in the international market, and to expand the production capacity of iron pipe projects," Ma noted.