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Is Egypt selling off its sovereignty to Saudi Arabia?

A handout picture released by the Egyptian Presidency on March 4, 2018 shows Egyptian President Abdel Fattah al-Sisi (R) welcoming Saudi Arabia (Photo by AFP)

Saudi Arabia and Egypt have reportedly set up a joint fund worth more than $10 billion to develop a megacity and business zone planned to be built by Riyadh on more than 1,000 square kilometers of land in the southern Sinai Peninsula.

At an international conference last October, bin Salman unveiled plans to build a new city and business zone, known as Neom, which officials say will be backed up by more than $500 billion in investment. The so-called city of the future is conceived to span an area of 26,500 square kilometers, stretching across the borders of northwest Saudi Arabia into Jordan and Egypt.

The deal was reached during a visit to Cairo by Saudi Crown Prince Mohammed bin Salman, an unnamed Saudi official told Reuters.

Adjacent to the Red Sea and the Gulf of Aqaba close to maritime trade routes that use the Suez Canal, Neom is said to be focusing on industries such as energy and water, biotechnology, food, advanced manufacturing and tourism.

According to the Saudi official, Riyadh plans to build seven cities and tourism projects, while Egypt will focus on developing the existing resort cities of Sharm el-Sheikh and Hurghada.

Riyadh will also work with Egypt and Jordan to attract European cruise companies to operate in the Red Sea during the winter season. The kingdom is negotiating with seven cruise companies and aims to build yacht marinas.

The joint Riyadh-Cairo fund came a day after Egypt’s top court dismissed all outstanding legal challenges to a controversial deal, according to which Cairo cedes the sovereignty of two of its Red Sea islands to Saudi Arabia.

Egyptian President Abdel Fattah el-Sisi announced in April 2016 that the two islands of Tiran and Sanafir fell within the territorial waters of Saudi Arabia as stipulated in a border accord signed between Cairo and Riyadh earlier that month, triggering legal action to block the deal and unprecedented mass demonstrations.

Protesters have accused the president of surrendering Egyptian territory in return for Saudi money amid reports that Cairo was receiving 20 billion dollars in aid from Riyadh to relinquish the sovereignty of the uninhabited islands.


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