Investment Magnet: Egypt's strategic bet on tourism

Zawya

6 hours ago

For centuries, Egypt's iconic landmarks and rich cultural tapestry have captivated the world. Today, the country is not merely preserving its timeless allure, it is actively crafting a vibrant and resilient tourism sector.
Poised to become an even more formidable engine of economic growth, this ambitious trajectory is not just aspirational, it is underpinned by a robust framework of strategic investments and compelling incentives designed to attract significant capital.
Egypt Sustaining Tourism Momentum
Egypt's tourism sector continues its impressive upward trajectory. In the first half (H1) of fiscal year (FY) 2024/2025, tourism revenues hit $8.7 billion, up by 11.5% from $7.8 billion in H1 FY 2023/2024, according to the Central Bank of Egypt's (CBE) latest balance of payments report.
Manal Mamdouh, an economics and international trade expert, tells Arab Finance: 'The surge in tourism highlights the growing confidence of travelers in Egypt. This is bolstered by the multifaceted nature of Egypt's diplomacy, supportive investment and visa policies, strategic global marketing, and alignment with sustainable development goals (SDGs). All of these contributed to this growth.'
Moreover, Mamdouh explains that Egypt has made major changes to how it presents itself as a travel destination. 'The Ministry of Tourism revamped its message under the slogan 'Egypt... A Diversity Beyond Compare' to blend knowledge and diversity. This strategy aims to promote economic tourism security, empower local communities as key partners in the tourism development system. It also integrates tourism more deeply into broader sustainable development via emphasizing diversification and economic resilience.'
Despite regional tensions, Egypt has remained safe and stable, which makes it more attractive to international visitors. Crucially, massive investments in infrastructure have transformed the landscape, with major developments along the North Coast and Red Sea, upgrades to transport and communication systems, and improved visa processes.
The government has also introduced attractive investment incentives and new regulatory frameworks to encourage capital inflow, particularly in emerging tourist cities. Furthermore, Egypt has successfully diversified its tourism offerings, moving beyond traditional sites to embrace niche areas like eco-tourism, medical tourism, and adventure. These efforts are supported by cultural heritage revitalization and strategic marketing.
Also, strong public-private partnerships and streamlined licensing, including "Golden Licenses," and the establishment of a Tourism Investment Bank, played a key role. They have significantly boosted private sector engagement, collectively enhancing the visitor experience, according to Mamdouh.
Egypt's Ambitious Tourism Goals
Egypt is aiming to attract 30 million tourists by 2031 as a key pillar of the government's new investment plan for the tourism and antiquities sectors. This ambitious goal was recently reviewed in a meeting chaired by Prime Minister Mostafa Madbouly, underscoring a broader strategy to significantly boost foreign direct investment into the country.
To support this effort, a dedicated unit is being established within the Ministry of Tourism and Antiquities to identify and catalog investment opportunities. Tourism minister described it as an 'investment opportunities bank' and stressed that reaching the 30-million-tourist goal is intrinsically linked to a substantial expansion of Egypt's hotel capacity.
In 2024, Egypt had 1,284 hotels with a total capacity of 228,146 rooms across various governorates, according to media reports from December 2024. The government plans to add between 200,000 and 250,000 new hotel rooms as part of its target to meet the 30 million tourists goal by 2028, the Cabinet announced in August 2024.
The Nexus of Infrastructure Development and Investment
Investing in Egypt's tourism sector is a main driver for boosting the sector's performance. Thanks to Egypt's location and history, the country can be a magnet for tourism investments.
Economist Mahmud Yusuf tells Arab Finance: 'Egypt is located in the northeastern part of Africa and shares a link with Middle East. It is historically known for its ancient civilization and monuments like museums, pyramids, mosque, and temples, amongst others. These attractions have drawn tourists, researchers, and institutions.'
Yusuf points out that Egypt was the most visited country in Africa until 2024, when Morocco took the lead. He believes Egypt can regain its top position if it successfully meets its strategic goals before the projected year.
Attracting more tourists and investors to the Egyptian tourism sector would also improve infrastructure development in the tourism sector through foreign direct investments (FDIs), public-private partnerships (PPP), and domestic investment. This would greatly reshape the tourism infrastructural challenges, positively contributing to the country's balance of payment (BOP) and gross domestic product (GDP) over time, Yusuf notes.
To attract investments, the country has been working on several channels. Mamdouh explains that the government has offered low-interest and fixed-interest loans, along with a support initiative for the tourism sector. This initiative includes EGP 50 billion in financing for tourism companies.
These efforts have helped boost investment in tourism facilities and increase the number of hotel rooms, in line with the National Tourism Strategy. This strategy aims to attract 30 million tourists annually by 2028 and help welcome 17.5 million tourists in 2024, as per Mamdouh.
Yusuf agrees, stating that Egypt's ambitious target to boost the number of tourists can be achieved by reviving the tourism industry through new infrastructural development. This includes establishing a unit to track and identify investment opportunities, upgrading existing infrastructures, and preserving Egypt's rich cultural heritage.
Mamdouh says, 'I believe it is crucial to turn tourism into a strategic, future-proof sector that supports Egypt's broader sustainable, inclusive, and diversified development agenda. This can be achieved through targeted sector reforms, infrastructure investment, and keeping pace with global trends in greening, sustainability, digitization, and virtual tourism.'
'These efforts will transform the sector into an engine of inclusive growth, create jobs, enhance international competitiveness, and raise tourism's contribution to GDP to 15%-18% from its current level of 12%,' Mamdouh adds.
Egypt's tourism sector is undeniably undergoing a profound transformation, moving beyond its historical allure to establish itself as a dynamic and robust engine of national economic growth.
The country is experiencing an impressive rise in tourism revenues, underpinned by record investments, forward-thinking policies, and an expanding hotel infrastructure. This signals that Egypt is not only reclaiming its historic status as a premier global destination but also charting a sustainable path for the future.
By embracing diversification, empowering local communities, and leveraging PPP, Egypt is transforming tourism into a dynamic engine for inclusive economic development.
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