CAIRO - 25 November 2024: The International Finance Corporation (IFC) has invested $605 million in three major projects in Egypt, aiming to advance economic development and sustainability.
These initiatives focus on climate finance, sustainable tourism, and expanding access to financing for small and medium-sized enterprises (SMEs), reinforcing IFC’s commitment to fostering inclusive growth in the country.
The first project involves a $300 million investment in sustainability bonds issued by the Arab African International Bank (AAIB), Egypt’s first issuance of its kind and the largest by a private bank in Africa.
This initiative is co-financed by the European Bank for Reconstruction and Development (EBRD) and British International Investment (BII), each contributing $100 million.
Seventy-five percent of the bond’s proceeds will fund green projects such as industrial energy efficiency improvements, small-scale renewable energy projects, and green building construction, while the remaining 25 percent will support social initiatives, including financing for micro, small, and medium-sized enterprises (MSMEs).
The second project allocates $155 million in sustainability-linked financing to Orascom Development Egypt to promote green tourism.
The funding will enhance energy and water efficiency and reduce greenhouse gas emissions in hotels located in El Gouna on the Red Sea.
This initiative aims to reduce energy consumption from non-renewable sources by 50 percent and decrease water usage by at least 20 percent. Additionally, part of the funding will restructure Orascom’s existing debt, enhancing the company’s financial resilience.
The third project consists of a $150 million investment in the Commercial International Bank (CIB) to strengthen its financial position amid current economic challenges. This funding will enable CIB to expand its financing for micro and SME businesses, with a focus on women-owned enterprises. The initiative is expected to create job opportunities, boost economic growth, and address the gender financing gap in Egypt.
Sérgio Pimenta, IFC Vice President for Africa, emphasized the strategic importance of these investments, highlighting their role in enhancing financial inclusion, accelerating the country’s transition to a green economy, and unlocking Egypt’s economic potential.
Rania Al-Mashat, Egypt’s Minister of Planning and Economic Development, underscored the alignment of these investments with Egypt’s national vision for inclusive and sustainable growth, while Central Bank Governor Hassan Abdalla noted their significance in creating a competitive and sustainable financial sector.
These investments align with the World Bank Group’s strategic partnership framework with Egypt, which aims to foster a green, inclusive, and sustainable development environment. They also support IFC’s broader mission to create jobs, expand financial access, and empower SMEs. Since its operations in Egypt began in 1975, IFC has invested and mobilized nearly $9 billion in various sectors, maintaining a $24 million advisory portfolio focused on fintech, climate finance, renewable energy, infrastructure, manufacturing, healthcare, and gender equity.
The agreements were signed during a visit by Sérgio Pimenta to Egypt, where he met with Prime Minister Mostafa Madbouly, Minister Rania Al-Mashat, Central Bank Governor Hassan Abdalla, and private-sector partners. During his visit, Pimenta reaffirmed IFC’s commitment to supporting the private sector and driving inclusive economic growth, underscoring the organization’s long-standing dedication to Egypt’s sustainable development.
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