EIB Inks €392 mln Contracts to Finance Projects in Egypt
The European Investment Bank (EIB) signed on Wednesday finance contracts with Egypt for an amount of 187 million euro in the water, transport and SME sectors. In addition, it signed a commitment to provide 205 million euro for an energy project.
The agreements were signed at the Headquarters of the EIB in Luxembourg by Egyptian Deputy Prime Minister and Minister of International Cooperation Dr. Ziad Bahaa Eldin, and EIB Vice-President Philippe de Fontaine Vive, in the presence of H.E. Mr Ehab Fawzy, Egyptian Ambassador in Brussels, Mr Hesham Okasha, Chairman of National Bank of Egypt (NBE), Mr Sharif Elwy, Deputy Chairman and EIB President Werner Hoyer, according to an EIB press release.
The EIB decided to lend €57 million in support of the Improved Water and Wastewater Service Programme II in Upper Egypt. The programme comprises the refurbishment, expansion and building of waterworks and wastewater treatment plants, as well as associated distribution and sewerage networks. The objective is to improve wastewater disposal as well as the quality of the water supply in the Governorates of Qena, Sohag, Assiut and Minya. The programme will contribute to enhancing the living conditions of15 million people in Upper Egypt by improving access to safe drinking water and sanitation services.
This loan underlines the strengthened cooperation with the European financial institutions AfD and KfW, as well as the EU’s Neighbourhood Investment Facility.
An EIB loan of €50 million will ensure safety and efficiency within Egyptian airspace in line with both the International Civil Aviation Organisation (ICAO) and EU standards. More precisely, the project consists of upgrading Air Traffic Control (ATC) services in Egypt by installing state-of-the-art Communications, Navigation and Surveillance (CNS) systems. The investment will be implemented at different sites across the country and cover a number of domestic and international airports.
Conscious of the key role played by businesses in restoring growth and employment in the Mediterranean, the EIB places development of the private sector at the heart of its priorities. The new €80 million credit line to the National Bank of Egypt (NBE) will contribute to financing SME projects in the productive sectors in Egypt. The objective is to improve SMEs’ access to credit in the form of long-term funding to support import and export transactions. The project is in line with the national objective of building a market economy, including measures to develop the private sector and foster the growth of small and medium-sized enterprises, encouraging investment and promoting job creation.
The EIB will in 2014 lend €205 million for the conversion of a power plant from open-cycle to combined-cycle gas turbine technology at El Shabab. The project will improve the plant’s generating efficiency, resulting in an increase in capacity to 1500 MWe and a 50% increase in electricity output, as well as fuel efficiency, in order to meet the growing electricity demand at a competitive cost and with a low environmental impact. The project will contribute to the expansion of the basic energy infrastructure needed for the economic development of Egypt, while the use of natural gas will enable the production of electricity with lower CO2 emissions compared to other fossil-fuel based alternatives. The project is being cofinanced by the EBRD and the Saudi Fund.
At the signing ceremony the EIB Vice-President said: “Our aim is to support the new Egypt’s social and economic transition by financing projects encouraging growth and employment. This is why we have decided to contribute to the modernisation of infrastructure and the development of SMEs. Through this action we are contributing to improving the daily life of the Egyptian people and building a future for the younger generation.”
Over the last two years the EIB’s Board of Directors has approved loans worth approximately €1 billion for projects in Egypt.
