On the shore of the Red Sea, the sunshine of Suhena Spring is scorching all year round. In January 2024, when the first pile foundation of Wanhe Electric was driven into this sandy soil, the surrounding area was mostly barren land and sea breeze. More than two years have passed, and the factory buildings have been lined up, with container trucks shuttling through them: the first set of products will be produced in March 2025, and in January 2026, Egyptian Prime Minister Mustafa Madebli will enter the workshop to unveil the gas water heater factory, marking the beginning of large-scale production of the base. Now, the red carpet is once again laid out on the adjacent 13300 square meter open space - the second phase of the Wanhe Electric Egypt base project has officially started construction.

From components to the whole machine

The total investment of the second phase project is 12 million US dollars, focusing on the production and assembly of gas water heaters and core components, and is expected to create more than 300 new job opportunities. Compared with the first phase, the second phase not only builds the factory again, but also supplements the chain: the first phase has been put into operation in January 2026, achieving localized production of water heater components; In the second phase, while expanding the production capacity of components, new assembly capacity for complete machines will be added, forming a complete industrial chain from components to complete machines. According to the plan, the base will have an annual production capacity of 2 million sets of water heater components and 500000 complete water heater units.

Targeting the Middle East and North Africa

Lu Siyi, the rotating president of Wanhe Electric, stated that Egypt's advantageous location and industrial foundation, coupled with policy support from the Egyptian government and the Suez Canal Economic Zone, have strengthened the confidence of the company to continue increasing capital and expanding production. Ahmed Gamal, Vice Chairman of the Southern Region of the Suez Canal Economic Zone, believes that the transition from the first phase of production to the second phase of expansion reflects the transformation of foreign-funded projects from landing to continuous upgrading. Wanhe's ledger also confirms this path: from 2023 to 2025, the company's export sales revenue will increase from 1.883 billion yuan to 3.011 billion yuan, and in the first half of 2026, the proportion of overseas revenue to revenue will rise to 46.31%. The pattern of coordinated supply among China, Thailand, and Egypt has basically taken shape. Egypt is promoting industrial localization and plans to increase the proportion of manufacturing in its gross domestic product from the current 14% to 20% to 30%. In addition to supplying the domestic market in Egypt, the second phase products will also be exported to the Middle East, North Africa, and Europe.

Model of China Egypt Cooperation

The Suhena Industrial Zone, where the project is located, is the core carrier for attracting foreign investment and developing industry in the Suez Canal Economic Zone. Since its construction in 2008, the China Egypt Teda Suez Economic and Trade Cooperation Zone, which carries it, has grown from a desert to an industrial new city: by the end of 2025, more than 200 enterprises have settled in, directly creating over 10000 job opportunities for the local area, and the proportion of localized employment exceeds 95%. White goods have become one of the leading industries in the park, and Chinese companies such as Midea, Haier, and Hisense have successively settled down, leaving their production lines, technology, and employment in Egypt. Li Daixin, Chairman of Central African TEDA Investment Co., Ltd., stated that from the landing of Phase I to the commencement of Phase II, Wanhe Electric has taken one step at a time in Egypt.

With the advancement of the second phase construction, Wanhe's production layout in Egypt will be further improved. The final production capacity, commissioning time, and export scale of the project will still be determined based on the construction and operation of the project. But from the two starts of construction of a factory, we can already see an increasingly clear path for Chinese manufacturing to go global: manufacturing locally in Egypt and radiating to the Middle East, Africa, and European markets.Editor/Yang Meiling