An ambitious plan to build a $45 billion administrative capital city in Egypt has hit stumbling blocks, a senior official has said.

Mustafa Madbouly, Egypt’s housing minister, told Reuters there had been “complications” in contract negotiations with the UAE investment fund that had agreed to lead the development.

Capital City Partners (CCP), which is led by UAE businessman and Emaar boss Mohamed Alabbar, had signed an initial agreement regarding the new capital in March.

Madbouly said negotiations were ongoing and “very sensitive”, Reuters reported.

Egypt plans a new city the size of Singapore to house government departments, which would include an airport bigger than London Heathrow. It is set to be built on a site to the east of Cairo.