Setcore’s $50m state-of-the-art cotton spinning factory stands alone in an expanse of desert scrub outside the city of Alexandria on Egypt’s Mediterranean coast. Within a year or so, however, it will be surrounded by one of the busiest construction sites in Egypt. Swiss, Italian, Turkish and Pakistani companies have all committed themselves to opening spinning, weaving and dyeing plants on the site. Three of them are Setcore clients, who plan to use its high-quality Egyptian yarn for fabrics that, until now, have been woven in Europe.

The speed with which the company has drawn others into an industrial cluster is testament to a new dynamic taking hold of Egypt’s manufacturing sector. As operating costs rise in Europe and Turkey feels the pinch of competition from India and China, Egypt’s potential as an industrial hub has suddenly come to life. Its labour costs are among the lowest in the Middle East, its energy – subsidised by the state – the cheapest and, unlike much of the rest of the region, it has abundant water from the Nile. In the past few years it has also entered into a slew of trade agreements that give it preferential access to Europe, the US and Turkey as well as other parts of Africa and the Middle East.