Transportation

Without transport, and its proper infrastructure, often economic growth is stifled. The World Bank emphasizes that access to transport is crucial for economic growth. This is because high transport and logistics costs due to poor infrastructure can pose major challenges to the economy. 

According to the World Bank, the transport sector in the Middle East faces various overarching challenges. This includes a lack of maintenance and underinvestment which results in poor road conditions, high transport costs and lack of access to all weather roads. This leads to a hindrance of essential service and economic opportunities. Furthermore, it emphasizes road safety as a major concern as many struggle to develop effective management and coordination mechanisms for the transport sector.

Moreover, the purpose of investments in transportation is to accelerate economic growth. There are studies that detail that investment in transport leads to a growth income. This is because connecting all areas of a country with its economic sectors, allows for access to markets and social services.

For instance, the World Bank’s Road Sector Development Program (RSDP) in Ethiopia monitored the country’s USD 5 billion investment in its road network. It found that these road upgrades contributed to an increase in economic activity and urban land. Even something as simple as adding nighttime lights leads to a higher level of economic activity.

Some economists propose that there are links between investment in high infrastructure to productivity growth in the manufacturing sector.

Middle East

Across the MENA region, there have been initiatives to improve access to sustainable transport.

For instance, the Yemen Emergency Lifeline Connectivity Project, is providing climate-resiliant road access. This is with the aim of fostering employment and entrepreneurship opportunities for the food-insecure rural population of Yemen. Furthermore, in its work it has generated over 682,000 employment opportunities,

Additionally, in Lebanon, the Roads and Employment Project, has been rehabilitating more than 530 km of roads and maintaining around 900km of roads. The project has already benefited over 1.4 million people by enhancing connectivity and improving access to services and jobs.

Moreover, in Tunisia, initiates have constructed over 137km of roads which has generated over 40,00 thousands months of employment, Additionally, it has improved road access and employment opportunities.

Egypt

According to Statista, the transportation sector in Egypt is expected to generate a revenue of USD 859.86 million by 2025. Furthermore, according to GAFI, the transportation sector in Egypt is one of the most essential axes of development. This is because, as discussed previously, transportation is closely linked to the development of any country. 

This is because of the requirements of economic, urban, and social development. In addition to sustaining the flow from production areas to consumption areas. Currently, one of the top priorities of the government has been to implement projects in the transportation system. With this it aims to provide a high quality service to citizens in the field of roads, railways, and subways.

Egypt’s efforts in the transport sector form a pillar for national economic growth. This contributes to attracting investments and creating an environment conducive to the private sector. A crucial part of this is initiatives to add nightlights to roads and railways to foster greater maneuverability. This is to foster a stronger base for development and economic growth. 

Challenges

According to the Egyptian Center For Economic Studies, mobility is a crucial pillar of economic activity as it has the ability to enhance competitiveness, generate jobs and attract foreign investment. 

One of the biggest challenges in Egypt right now is its outdated rail network system which often results in accidents. However, recently the government announced initiatives to improve its railways network. Furthermore, around USD 8.13 billion is required to overhaul the country’s rail network.

Another major challenge is traffic congestion which often impacts the quality of life and economy.  According to the World Bank, the economic costs of congestion in Cairo could be 4% of the GDP yearly. This means an economic cost to Egypt of up to EGP 50 billion a year (USD 8 billion/year).  This, however, is a major issue for all metropolitan areas given their usual high population density. However, a way to solve this problem is better developed public transport, pedestrian planning, and parking meters.

On the positive side, Egypt has invested EGP 2 trillion in major transport projects including the railway system. All in an effort to bolster investment opportunities, attract foreign investment and foster economic growth.