A Strategic Threat to National Security: Will Sisi Sell 'Ras Banas' to Foreign Powers?

On September 14, Egypt's Housing Minister, Sherif El-Sherbiny, announced the government's plans to prepare a strategic blueprint for offering the Ras Banas Peninsula, a pristine area on the Red Sea, to both foreign and local investors.

This move is part of a broader effort by Egypt to “attract investment” by selling off state assets, as the country struggles to generate hard currency and address mounting external debt, which hit $153.8 billion in July—down from $168 billion at the end of 2023.

Foreign Control

In an effort to draw interest from potential investors, El-Sherbiny highlighted the peninsula's unique natural beauty and economic potential. Ras Banas boasts some of Egypt’s most spectacular beaches and is home to one of the world’s largest collections of untouched coral reefs.

The area extends approximately 50 kilometers into the Red Sea, a size comparable to the Ras El-Hikma area on the North Coast, which was recently sold off to the United Arab Emirates (UAE).

This proposal comes on the heels of the controversial sale of Ras El-Hikma, an area in Egypt's northwest.

The UAE secured that land in a $35 billion deal, a transaction expected to close in October.

Despite the infusion of foreign capital, the Ras El-Hikma deal has drawn sharp criticism within Egypt, with many concerned about the nation losing control of strategically significant coastal regions

“Egypt’s sale of such crucial land endangers its national interests, particularly given the strategic location of Ras El-Hikma along the Mediterranean Sea,” political activist Osama Fouad told Al-Estiklal.

Now, similar concerns surround the sale of Ras Banas, which holds significant military and economic value due to its proximity to vital global trade routes.

It sits near the Suez Canal to the north, the Bab al-Mandab Strait to the south, and the Strait of Hormuz to the east.

“Again, Egypt might cede a critical location to foreign powers, especially as competition heats up among regional players like Saudi Arabia and the UAE, all of which are seeking influence in the region,” Fouad added.

Since 2019, Egypt has pursued a controversial policy of selling off state assets under the guise of attracting investment to tackle its deepening economic crisis.

Critics accuse the government of mismanaging the economy and pursuing unsound financial policies, resulting in a worsening fiscal situation.

These detractors warn that Egypt's desperate need for cash is forcing it to relinquish strategic assets, including land with military, economic, and security importance, in exchange for short-term financial gains.

Strategic Asset

The Ras Banas plan has thus reignited concerns that Egypt is sacrificing long-term national security for immediate financial relief.

Strategic and financial incentives driving competition for the area—factors that might not be immediately apparent to the average Egyptian citizen.

The Ras Banas Peninsula, strategically located along key international waterways, has long attracted the attention of global powers due to its geographical significance.

Positioned near the Strait of Hormuz, the Suez Canal, and Bab al-Mandab, the area is a vital gateway to the Arabian Gulf, the Middle East, and North Africa.

This has made it a focal point for geopolitical competition, particularly during the Cold War, as both the Soviet Union and the United States sought to establish a foothold in the region to bolster their influence.

In 1970, the Soviet Union established a secret military base at Ras Banas, following a 1964 Soviet-Egyptian fishing agreement. It was the first Soviet base in Egypt, though its existence was not revealed to the public until two years later. The Soviets saw Ras Banas as a key asset in their efforts to project power across the region.

By the late 1970s, as Egypt pivoted toward the West under President Anwar Sadat, the United States began exploring the potential of Ras Banas as a military asset.

In 1979, then-Secretary of Defense Harold Brown encouraged the use of the peninsula as a U.S. naval and air facility, and during Sadat's 1981 visit to Washington, he signed an agreement allowing the U.S. to use the area as a potential launch site for operations in the Gulf, the broader Middle East, and North Africa.

The Pentagon’s vision for Ras Banas was ambitious, with plans to make it a key facility for U.S. Central Command.

The proposal included a water desalination plant, fuel tanks, warehouses, barracks capable of accommodating 25,000 troops, and the use of B-52 bombers and C-5 transport aircraft.

Discussions about leasing Ras Banas to the U.S. continued behind the scenes, even as some reports indicated American aircraft were using the port without full government oversight, in direct coordination between the Egyptian Ministry of Defense and the Presidency.

When Hosni Mubarak assumed the presidency, he firmly rejected the establishment of a permanent U.S. base at Ras Banas, though he allowed U.S. rapid deployment forces to use the site during emergencies.

In recent years, speculation about American military presence at Ras Banas has persisted. Some analysts have suggested that the area functions as an unofficial U.S. military base.

Others dispute this, but the peninsula's geopolitical importance ensures that it remains a point of contention among global powers, vying for control over this strategically vital location.

Regional Rivalry

The competition for Egypt's Ras Banas Peninsula, a prized Red Sea asset, is intensifying among Gulf nations, though little information is currently available about specific bidders.

Given the massive financial requirements for a deal of this magnitude—similar to the Ras Al-Hikma transaction—it is unlikely that Egyptian investors will play a significant role.

As in past deals, Gulf investors are expected to be the frontrunners, particularly given the peninsula's logistical importance alongside its tourism and investment potential.

Speculation suggests a brewing rivalry between Saudi Arabia and the United Arab Emirates (UAE) for control of Ras Banas.

Both nations are eager to expand their influence in the Red Sea region, capitalizing on Egypt’s ongoing economic struggles, which have forced the country to sell off key assets.

According to Fouad, Ras Banas presents a strategic asset for Saudis, as it lies directly opposite their major port of Yanbu.

“In the context of recent tensions and competition for regional dominance, Riyadh may be reluctant to allow the UAE to claim such a significant prize,” Fouad mentioned.

“On the other hand, the UAE has been aggressively pursuing strategic real estate across the Red Sea and beyond, in places like Yemen, Ethiopia, and the Horn of Africa,” he noted.

“Its ambitions in the region extend beyond economic interests, encompassing political and military objectives that align with its broader regional agenda. The acquisition of Ras Banas would strengthen the UAE’s hold on critical maritime routes and enhance its regional influence,” he said.

Meanwhile, Ras Banas’s proximity to Egypt’s Berenice military base, inaugurated in 2020, raises national security concerns.

The base is tasked with safeguarding Egypt’s southern borders, and its location near Berenice International Airport—along with its deep-water naval facilities—makes the Ras Banas Peninsula a vital military and logistical asset.

Ceding control of the area to foreign powers, regardless of their identity, could pose significant risks to Egypt’s sovereignty and security, particularly if future conflicts of interest arise with the buyer.

The UAE's growing influence in these strategic zones, coupled with its controversial regional role, raises additional alarm.

Whether in Sudan, Ethiopia, Yemen, or through its interactions with the Israeli occupation, the UAE's interests frequently conflict with Egypt’s own national security concerns.

Allowing Emirati control over Ras Banas would only heighten the risks associated with foreign control of critical Egyptian territory.

Fouad says that Egypt’s decision to sell off such vital areas is seen by many as a consequence of years of misguided economic and political management.

“The country’s increasing reliance on selling its most valuable assets, including key maritime ports and logistical hubs, is placing its long-term sovereignty and security in jeopardy. Without a shift in strategy, Egypt’s future risks being mired in a deep and unpredictable crisis,” he concluded.