China has agreed to contribute US$64 million to the Egyptian Earth observation satellite program, EgyptSat, as part of a new cooperation agreement between the two counties signed on March 21, 2017.
The funding will be contingent on a feasibility study on the EgyptSat program, but is thought to be a part of a US$7 billion Chinese grant to develop infrastructure along the Suez Canal Economic Zone as part of Beijing’s One Belt One Road initiative that intends to build land and sea infrastructure across Eurasia and the Indian Ocean linking China with the Mediterranean Sea region.
Further, China and Egypt have signed an agreement that will see Beijing provide a US$23 million grant for an Egyptian satellite test, integration, and assembly facility. This facility is in line with the Egyptian policy intent to be self-sufficient and strategically autonomous in the manufacture of satellites and satellite components.
Both agreements were prepared on the Egyptian side by Egypt’s National Authority for Remote Sensing and Space Sciences (NARSS).
EgyptSat-A is being built as a replacement for EgyptSat-2 that failed in orbit in April 2015 less than a year after its launch.
EgyptSat-A is being built using the funds recouped from the insurance claim against the EgyptSat-2 loss, said to be US$100 million. In August 2016 SpaceWatch Middle East reported that RSC Energia was in talks with NARSS about developing EgyptSat-A as a replacement for EgyptSat-2.
Egyptian press reports about the proposed Chinese funding contribution to EgyptSat do not make clear whether the contribution is for the EgyptSat-A program, or for another EgyptSat satellite as yet unannounced.
Earlier in 2016, Egypt signed a deal with French companies Airbus Defense and Space and Thales Alenia Space for a military communications satellite. It is believed that the French companies also offered Egypt a high-resolution imagery satellite but that Cairo demurred because of the cost. It was later reported in the defence and aerospace press that South Korean and Russian companies were in discussions with Egypt to build a high-resolution imaging satellite, but China was not mentioned at the time.
China and Egypt have been busy building close ties with each other over the past several years as part of Beijing’s One Belt One Road initiative in order to secure China’s maritime access to the Mediterranean Sea via the Suez Canal. From Cairo’s perspective, China is an economic lifeline in light of Egypt’s economic troubles since the political turmoil that occurred since 2011.