- Mobily and Telecom Egypt project
- Other projects under way
- ‘Significant milestone’
Mobily and Telecom Egypt have signed an agreement to lay the first subsea cable between Saudi Arabia and Egypt, the companies announced in a joint press statement on Monday.
The new cable will connect the Red Sea resort of Sharm El Sheikh with the Saudi city of Duba. Egypt already has landing points for 18 subsea cables and Saudi Arabia has landing points for 20.
The new cable is intended to improve the speed and efficiency of communications between Egypt and Saudi Arabia and the flexibility of internet traffic between Europe and the Middle East.
In a press statement, Mobily CEO Salman bin Abdulaziz al Badran said it would enhance Mobily’s own international capacity and “represents a significant milestone in strengthening Saudi Arabia’s position as a leading international hub for telecommunications services and data traffic, in alignment with the goals of Saudi Vision 2030.” The new line will be wholly owned by Mobily.
Multiple telecom companies are launching projects to connect Africa, Europe and Asia. In January, Telecom Egypt and Zain Omantel International, which is based in Muscat, announced plans for a “digital corridor” connecting the Mediterranean to the Arabian Sea and Arabian Gulf and increasing communications options from India to Europe.
The risks of operating in the Red Sea were made clear in March when three Red Sea cables were cut following an attack by Yemen’s Houthi rebels.
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Egypt and Saudi Arabia are both working towards ambitious economic goals. Saudi Arabia’s Public Investment Fund intends to decrease its share of overseas investments from 30 percent to less than 20 percent and focus more on its local investments.
Egypt’s economic recovery has been shaken by the impact of Israel’s war in Gaza and resulting shocks to regional tourism and the Red Sea shipping trade.
A purchasing managers’ index released by S&P Global on Tuesday suggested that the non-oil sector contracted for the second month in a row in November, after briefly entering growth territory in September.
Egypt is implementing austerity spending alongside economic reforms in an effort to reduce its ballooning debt obligations, yet it is having to balance this against managing the growth of inflation, which rose to 26 percent in September.