The Egyptian government is said to be in talks with Chinese companies over plans to build an industrial park in the Arab country capable of producing 1 GW of solar modules.

The report, citing four government sources, said the investment required for the project was estimated at $2.3 billion.

The parties involved in the talks are discussing potential financing of the initiative through loans provided by Chinese banks and repaid by the Egyptian government over a period of time, one of the sources said.

Reported plans for local production come amid growing fears about the fate of Egypt's solar projects amid a severe shortage of modules. The Solar Energy Development Association (SEDA), which supports the Egyptian solar market, recently warned that shortages of equipment such as solar cells, transformers, solar heaters and cables are putting project implementations across the country at risk.