Consolidated Contractors Company (CCC) And Their Projects in Egypt

Interview with Bassam Daher, Area GM (Egypt, Libya, Sudan) of Consolidated Contractors Company (CCC)

Please give us an overview of the contracting industry. How has it been affected by the revolution? What are the current developments?

When the revolution started here, all the related governmental activities were hit badly, mainly developers. Several developers were keen to invest money and start building their own company, but because of the revolution, they have just put a stop to these projects. Now, these kind of positive trends are again on the rise. The second challenge for us as existing contractors was dealing with the governmental activities with regards to taxations, labor issues. There was a time when there was a strike every other day, the labor force refused to work. This created a burden on us. Because the country had other priorities, we had to deal with all these setbacks, including power cuts. For many of our projects we are forced to scavenge for diesel and generators to continue with our work. We have successfully faced all these challenges. But now, we believe that the country is on the right track to set these things right. The labor forces are regularized again, no more strikes. Procurement activities have started again, because during the turmoil, we couldn’t import. There were constant delays etc. For projects like these, 60% of the products are from abroad – from Europe, the States, the Far East, from India. Now things are moving well. This project was delayed. We were supposed to open last year.

Contracting environment was going through a tough period. Things are still not completely back to normal, but things are a lot better.

What is your position in the market?

The market is divided into local contractors and international contractors. There are many local contractors. Among the local contractors, there are private contractors and governmental contractors. There are very limited number of international contractors. I know only of 3 companies. Imagine that. This big a market only has 3 contractors. But this is because of the situation etc.  But now, there will be more contractors, especially from the Gulf, because the finance is coming mainly from the Gulf.

CCC is one of the leading contracting companies in the country. What are your major projects this year?

To start with, we are general contractors. We take up all kinds of contracting works. But in Egypt, we are specifically working on power stations, because this is something that always has a demand in the market. We are doing hotels and high quality buildings. We are working on military establishments, airports, runways etc. We are also working on high-end resorts, like the palace I mentioned about before. We are doing embassies, banks and headquarters. We just recently completed the HSBC headquarters. These are the various projects that we are involved in.

What project is being worked on here at this venue?

This is a hotel with 3 towers and around 229 rooms for the hotels and around 130 furnished luxury apartments. They have all facilities like restaurants, kitchens, laundries, swimming pools. This is owned by the Government of Qatar and is operated by the St Peter’s Hotel Chain, a well-known chain in the hotel business.           

When do you hope to launch that?

We have a set goal of end of this year. So, give or take 2 to 3 months. We are in an advanced stage.

In this complex Egyptian market which areas do you see yourself developing the most? You have named some of them. What area do you have a competitive edge in? Say with some foreign contractors or even local?

Because we have been in Egypt for more than 20 years, we have created a big pool of employees from the Egyptian market. This helps us to compete with the local prices. This is a major advantage, because to work in Egypt, we have to be competitive. As I said, there are a lot of local contractors, who are usually more competitive than foreign contractors, because their cost margins are different. But because we have been here for long and have this pool of local resources, suppliers and contractors. I consider myself as an international contractor with a strong local background. 

How do you see the country moving? You mentioned some conferences. How do you see the needs of the country? Where do you see this country in the next two years?

Egypt is a big country. It has many challenges with respect to the economy, the infrastructure, development and so on. I believe these challenges are big, but at the same time, the will to overcome these challenges is also big. I know the Prime Minister personally. He was a contractor, before he became the Prime Minister. He was the head of Arab contractors. We have worked in joint ventures in many projects, so I know him personally. He is one of the most dynamic persons, who is leading the country in the right direction. I believe that his efforts are genuine and I do believe that the government now has a well-planned route for leading Egypt from this era to a new era with more projects, a better economy and more benefits for the people. Ordinary Egyptians need to see the benefits of all these projects – be it through employment or through any economic other kind of benefits. Once the power generation system is improved, everybody will be pleased, because you will have more factories and better investment opportunities for even the local sectors. So, I have a very positive feel for the coming two years.  But it will take time. 2 years has 24 months. You can’t expect changes immediately. After one year from now, things will start moving. Especially after the election, the parliament will start functioning and the country will start progressing.

Do you think that your potential clients – some international brands – should believe in the developmental potential here and they should come and invest here? Like the St Regis Hotel here, has decided to invest?

Look, Egypt has big investment opportunities. Egypt has 90 million people. You can imagine, a country with 90 million people is not like a country with 5 million people. So there are big needs and services that can be provided to these 90 million people. I believe that the investors are aware of this and that’s why I believe they will be coming. But again, the high-priority projects are related to networks, hotels, sewage etc. are related to power generation. The third criteria is housing. There are big investors coming from Abu Dhabi mainly and they are thinking of mainly building around 1 million flats in two years. One million is not a joke. They have finalized the plans, drawing, financial arrangements. So, in the next two years, there will be a lot of investors mainly from the Gulf. I cannot see many coming from Europe and such countries, but I can definitely see an investment potential from UAE, Bahrain, Saudi Arabia and Kuwait. These are the countries that are interested in seeing Egypt succeeding in the coming period.

You would also be interested in getting a chunk of this investment scheme?

Yes, we have set targets with this regard and we will be participating in this.

To summarize, let’s say everything goes well in 5 years’ time, how do you see the development of your company here? How do you perceive it if everything goes as well as you just predicted?

I do see this happening in the coming years, because as I mentioned, we do have the resources to fulfil the targets. I have told our headquarters that we need to spend more. That’s why we are also entering into some investment opportunities in this country. We are not only waiting for clients to give us work, but we have a policy of participating in certain financial ventures. We actually have a team working on this plan already. Because the projects are big, we have the option of teaming up with some other companies. I don’t have to the whole cake. I can always team up with foreign contractors from the Gulf, because we have good relations with them. So, we can team up with them and work together.

If you were to invest, what fields would it be in?

We are already investing in a petrochemical complex here in Sokhna. Our next target is to invest in some real estate development. We are looking at some options in this field.
 
So are you looking to attract the attention of some investors?

Yes, our presence in this country with our background in the Gulf area gives us an advantage to deal with these trade partners.