Negotiations between Egypt and property developer China Fortune Land Development (CFLD) over building a new capital city near Cairo are believed to have failed.
Neither party could agree on terms for sharing revenue made from the real estate megaproject, hindering Egyptian President Abdel Fattah al-Sisi’s aspiration to build the new capital, according to Bloomberg.
Egyptian authorities wanted 40% of the revenue, while Chinese builder CFLD wanted up to a third of the share, according to Khaled Elhusseiny from Egypt's New Administrative Capital for Urban Development (ACUD), the body behind the project.
“We found that to be unacceptable, especially [as] they were going to have a premium plot,” he told Bloomberg.
Negotiations for the $20bn development had been ongoing for two years. The latest round of talks reportedly started after Egyptian officials sent a response to CFLD's final proposal, but did not receive a response.
ACUD chairman, Ahmed Zaki Abdeen, said the talks have stopped.
This apparent failure leads to questions about the longevity of a megaproject that Egypt hoped would cover more 60km² upon completion, which officials expected would take 25 years. The city would have become a key driver of growth for Egypt's plan to revive its economy. Last year, Egyptian media said Talaat Mostafa had won a contract to build an urban project in the new capital city.