CAIRO - 22 August 2022: The European Bank for Reconstruction and Development's (EBRD) financing in Egypt may exceed 1 billion euros this year in light of Egypt's hosting of the climate change conference (COP27) in November, said Managing Director for the EBRD’s Southern and Eastern Mediterranean (SEMED) region Heike Harmgart.
Egypt is among the top investment markets for the EBRD, Harmgart added in exclusive statements to MENA.
She further expounded that the EBRD invests 1 billion euros in Egypt annually, saying that the bank plans to finance projects aiming at supporting green transition.
Greater attention will be given to green investment, she affirmed, noting that the EBRD will focus on supporting renewable energy as well as eco-friendly transportation.
Talking about her projections for the Egyptian economy, Harmgart said that the Central Bank of Egypt (CBE) is doing well in terms of managing exchange rates and inflation expectations, especially that the world is going through difficult circumstances.
The CBE made rapid efforts to respond to global shocks and crises to mitigate, adapt and recover from the effects of the Covid-19 pandemic along with the Russia-Ukraine crisis, she further said.
It is difficult to predict the exchange rate changes approved by the CBE, she said, adding that the Egyptian pound is now 16% overvalued compared to the US dollar.
Asked about the opportunities of returning short-term investments in treasury bills and bonds, which withdrew from the Egyptian market with the US Federal Reserve raising its interest rates, Harmgart said that the stability in Egypt's economy represents an important factor to lure foreign investments.
The EBRD will work to provide more support to the Small and Medium Enterprises (SMEs), she went on to say.
The EBRD will focus on three strategic priorities including measures of promoting a more inclusive economy for Egyptian businesses, women and youth, accelerating Egypt’s green economy transition and enhancing the country’s competitiveness by supporting private-sector growth and strengthening governance, she elaborated.
Regarding the State Ownership Policy document, which was announced by Prime Minister Moustafa Mabdouli last May, and aims to increase private sector participation in public investments to 65% in the next three years, Harmgart hailed the move, saying that the EBRD believes that the private sector is the main driver behind the economic growth.
The private sector contributes a great deal to securing jobs and attaining economic growth, she added.
The private sector projects, which are supported by the EBRD, include renewable energy and wind energy, she further said, adding that Egypt has a strong potential to contribute to the green transition, which will benefit the country.
The EBRD is looking forward to supporting water projects, she said, adding that this issue was tackled with the prime minister and other ministers.
Egypt is a founding member of the EBRD. Since the start of its operations there in 2012, the EBRD has invested more than 8.9 billion euros in 146 projects across the country.
In early August, Minister of International Cooperation Rania al-Mashat discussed with Harmgart boosting bilateral cooperation regarding joint initiatives and projects figuring high on the agenda of the COP27 in the Red Sea resort city of Sharm el-Sheikh.
During their meeting, the minister tackled the possibility of promoting developmental cooperation ventures including financing green projects and looming opportunities pertaining to a program to incentivize green public investments in the energy, food and water domains, as part of Egypt National Climate Change Strategy 2050 (NCCS).
According to Mashat, all efforts are meant to build up toward realizing sustainable development goals.
The upcoming stage will see further cooperation between Egypt and the EBRD, within the framework of 2022-2027 new strategy, that aim at meeting the state's developmental needs and supporting all drives to overhaul the various state sectors, the minister said.
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