GE sees ‘tremendous’ opportunities in Mideast
(6/19/2017 8:11:00 AM)
General Electric Co is looking at opportunities to invest in transportation in the Middle East and Africa after signing a $575mn railway deal in Egypt, and expects growth in all sectors there.
The company is interested in railway opportunities in Turkey and Algeria as well as the next phase of Egypt’s transport expansion, GE Vice chairman John Rice said in a phone interview from Cairo. GE has tenders under discussion in several countries. It signed a letter of intent with Egypt on Saturday to supply 100 Light Evolution Series locomotives to be used for either passengers or freight, making it GE’s biggest deal with the Egyptian National Railways.
“Demand for infrastructure continues unabated, the region is shifting to renewables, which is becoming more and more important, and healthcare is significant,” said Rice, who is also president and chief executive officer of GE Global Growth Organisation. “We see tremendous opportunities for growth and we don’t expect that to change.”
GE’s investments in the Middle East range from aviation to transport to healthcare and oil and gas. During US President Donald Trump’s visit to Saudi Arabia in May, the company signed memorandums of understanding worth $15bn. Orders from the Middle East increased at double-digit rates in recent years to $15bn in 2016. GE expects annual total order growth from the region of 5% to 10% over the next three to five years and double-digit expansion this year in its international business outside the US, Rice said.
The company will finance the Egypt deal with the help of Canada’s export-credit agency, Export Development Canada, Rice said, calling the agreement “evidence that Egypt is open for business.” The accord includes a 15-year agreement for supplying parts and technical support for the Egyptian National Railways’ new and existing fleet. Egyptian railways currently has about 80 GE locomotives.
GE is in the middle of a CEO transition, replacing Jeffrey Immelt after 16 years with John Flannery, a 30-year company veteran. Flannery has experience in GE’s operations outside the US and comes to the new role with a global outlook.