MOSCOW, November 25. /TASS/. Egypt is ready to expand the Russian industrial zone near Port Said from 80 hectares to 2,000 hectares in the future, Russia’s Industry and Trade Minister Denis Manturov said at a meeting of the Council for Strategic Development.

"Egypt’s President (Abdel Fattah) el-Sisi has decided to allocate 80 hectares to us in the eastern part of Port Said in the Suez Canal. In prospect they (Egypt) are ready to expand this zone to 2,000 hectares," Manturov said.

The minister said that that the intergovernmental agreement will in particular provide tax privileges for the companies operating on the territory of the industrial zone. He added that the work on the agreement may be completed in the first quarter of 2017.

In February 2016, industry ministers of the two countries signed a memorandum on establishing the Russian industrial zone in Egypt. The project envisages creation on the territory of the Port Said free economic zone of a special zone with a lighter tax regime for Russian resident companies. Russian carmakers, petrochemical enterprises, energy and medical companies will set up their production facilities within that zone. The zone should start operating in late 2018. The construction of production facilities is to start in June 2018. In August 2017 the managing company (Russian Industrial Zone in Egypt) will be set up. In August 2017, it will start designing of the first stage of industrial zone within the area of 80 hectares.

According to preliminary calculations, by 2035, investments in construction of the entire infrastructure of the Russian industrial zone in Egypt will total $4.596 bln.