African Dev. Bank disburses $500M to Egypt, 3rd tranche coming in December

CAIRO – 31 March 2017: The African Development Bank (AfDB) disbursed Friday $500 million to Egypt, the bank's representative in Cairo, Leila Mokaddem, told Egypt Today Friday. It is the second tranche of a total loan worth $1.5 billion.

In December 2015, Egypt signed two budget support loan agreements totaling $4.5 billion: $3 billion from the World Bank (WB) and $1.5 billion from the AfDB to support its economic reform program over three years.

"The disbursement of the second tranche is done today (Friday) and will reach the government's account in a couple of days," Mokaddem said.

"The loan will be allocated to fill the budget deficit, improve the energy sector and enhance the business environment in particular industrial licensing, open the energy and gas sector to private investments and promote financial inclusion, support micro, small and medium enterprises," she said, adding that the third tranche of the loan is scheduled to be disbursed by December.

Fresh finance from multilateral banks during March and $1 billion from the WB - the second tranche of a $3 billion-loan agreement - in addition to $500 million from the AfDB will likely push Egypt's foreign reserves to $28 billion by end-March, up from 26.5 billion in February.

Egypt's reserves have edged up since the country clinched a $12 billion deal with the International Monetary Fund in November to support is ambitious economic reform plan. Egypt received $2.7 billion as the first tranche of the IMF loan and the second is expected in June after an official review of the program by the fund.