Egypt, World Bank advance plans for infrastructure financing guarantee mechanism
The mechanism to support long-term local-currency financing, help ease pressure on public spending
Egypt and the World Bank are in the final stages of launching a mechanism to attract private-sector investment into infrastructure projects by providing long-term financing solutions in local currency and reducing investment risks, Egypt’s Planning and Economic Development Ministry said on Wednesday.
Planning and Economic Development Minister Ahmed Rostom met World Bank officials and representatives of international and regional financial institutions to review the mechanism’s implementation and preparations for its launch, the ministry said.
The mechanism, known as the Infrastructure Finance Guarantee Facility (IFGF), is being developed in cooperation with the World Bank to encourage greater private-sector participation in the economy and ease pressure on Egypt’s state budget, Rostom said.
The mechanism will focus on mobilising local-currency financing and reducing investment risks in key sectors including renewable energy, water treatment and desalination plants, and modern transport projects, he said.
Rostom said the mechanism would also help improve the efficiency of public spending and support Egypt’s Vision 2030 targets for economic growth and employment.
The ministry is coordinating with the World Bank and relevant Egyptian authorities to accelerate the mechanism’s activation, with a focus on key productive and service sectors, Rostom said.
Representatives of participating international and regional financial institutions expressed interest in joining the mechanism and contributing guarantees and financing solutions, the ministry said.
Participants included the African Development Bank (AfDB), European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), Asian Infrastructure Investment Bank (AIIB), Japan International Cooperation Agency (JICA), British International Investment (BII), French Development Agency (AFD), the World Bank Group, International Finance Corporation (IFC), Germany’s KfW Development Bank, and Switzerland’s State Secretariat for Economic Affairs.
The World Bank team presented an update on the mechanism’s implementation, launch stages and timetable for beginning operations, the ministry said.
World Bank representatives reaffirmed their commitment to providing technical and advisory support to help reduce financing risks and attract private-sector investment in Egypt’s infrastructure sector, the ministry said.