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  • Monday, 25 September 2023

Coinciding with the Launch of the AIIB’s Annual Meetings in Sharm El Sheikh, The Ministry of International Cooperation Reviews the Development Cooperation Portfolio with the Bank

● The bank provided soft development financing for the Benban Solar Park worth $210 million and $150 million in lines of credit to commercial banks.

● $300 million in development funding for water projects and $250 million in funding for the Abu Qir Metro in Alexandria.

Coinciding with the launch of the annual meetings of the Asian Infrastructure Investment Bank (AIIB) in Sharm El-Sheikh, under the patronage of H.E. President Abdel Fattah El-Sisi, President of the Arab Republic of Egypt, the Ministry of International Cooperation reviews the details of the development cooperation portfolio ongoing with the bank since Egypt officially joined its membership in 2016, as it is one of the specialized multilateral international development banks in financing and investing in sustainable infrastructure projects and stimulating green and smart investments that enhance regional connectivity.

Since Egypt joined the bank, the AIIB has contributed to financing a number of projects that come in light of the country’s strategic priority for the public and private sectors, with the portfolio recording about $1.3 billion, in various infrastructure sectors, in order to promote sustainable and comprehensive economic development.

The Private Sector

Among the AIIB’s portfolio, it provided soft development financing worth $360 million, including $210 million in financing to 11 private sector companies that contributed to the implementation of the Benban Solar Energy Park in Aswan. This is one of the solar energy parks in the region and the world with capacities of up to 2000 megawatts. The complex is an example of the importance of multilateral cooperation, as many international financial institutions contributed to its financing, including the AIIB, the International Finance Corporation (IFC), and the European Bank for Reconstruction and Development (EBRD).

In addition, the AIIB made $150 million available in credit lines to banks to re-lend to small and medium enterprises, enhancing the financing available for these types of projects that stimulate comprehensive and sustainable growth and provide job opportunities. Over the past three years, the Ministry of International Cooperation has strengthened international partnerships aimed at empowering the private sector, which resulted in soft development financing for the private sector amounting to approximately $7.3 billion, in addition to $2 billion from the beginning of 2023 until now, which reflects the pivotal role of international financial institutions in stimulating the private sector through concessional development financing.

The Government Sector

Additionally, the AIIB has contributed to providing soft development financing worth $300 million to the water sector in light of the priority given by the state to sustainable water resources management projects and the implementation of SDG 6: Clean Water and Sanitation.

During the past year, the bank also provided development policy financing worth $360 million, which aims to support development efforts by enhancing overall sustainability, opening horizons for private sector participation in development, and stimulating women’s empowerment efforts. The financing achieves three basic pillars: enhancing overall financial sustainability -which includes its improvement- managing state-owned enterprises by enhancing transparency and reporting, and stimulating the transition towards a green economy. This includes improving the management of state-owned companies by enhancing transparency.

Moreover, the bank is one of the multilateral development banks contributing to the financing of the Abu Qir Metro Project in Alexandria, as it provides concessional development financing worth €250 million. The Minister of International Cooperation, H.E. Dr. Rania A. Al-Mashat, signed the financing agreement with the President of the Bank during her visit to the Chinese capital, Beijing, last July. The project contributes to reducing traffic congestion in Alexandria, supports the transition to environmentally friendly means of transportation, and reduces harmful emissions. Alongside the AIIB, the EBRD, the European Investment Bank (EIB), and the French Development Agency (AFD) contributed to the project’s financing.

It is worth noting that, during the current year, Al-Mashat paid multiple visits within the framework of the role assigned to the Ministry to enhance multilateral cooperation and develop economic relations with multilateral and bilateral development partners to advance the country’s development vision.

H.E. met with the President of AIIB, Jin Liqun, twice this year, the 1st during the UN’s Conference on Least Developed Countries in Doha, and the second during H.E.’s visit to Beijing last July to participate in the 1st High-Level Meeting of the Forum on Global Action for Shared Development. H.E. also met with the vice presidents of the bank during the activities of the meetings of the African Development Bank (AfDB) in Sharm El-Sheikh.

Features of the Framework of International Cooperation and Development Financing with Asia

This year witnessed a boost in Egyptian relations with Asian countries, international financial institutions, and multilateral development banks, based on the state’s keenness to diversify and strengthen its relations with various multilateral and bilateral development partners to support the state’s 2030 development vision.

The most prominent developments in cooperation with Asia during 2023:-

● Egypt’s  membership in the New Development Bank (NDB) of the BRICS group during the current year where Al-Mashat participated in the 8th session of the bank’s annual meetings, which were held in Shanghai, China. During which she confirmed that Egypt will obtain membership in the NDB, along with the major emerging economies members of the BRICS group. This enhances South-South cooperation, supports the efforts undertaken by the government to transfer expertise and development experiences in the field of economic development and helps the international community stimulate development efforts around the world.

● This year witnessed the holding of the Joint Policy Dialogue, organized by the Ministry of International Cooperation and the Japanese Embassy in Cairo with the participation of concerned parties from both sides, which constitutes a prominent importance as a platform for strategic dialogue between the two governments and a national mechanism to enhance bilateral cooperation in a manner consistent with the priorities of the Government of Egypt, with the participation of relevant parties from the two sides, and setting joint cooperation priorities for the next five years.

● During the visit of the Minister to the Chinese capital, Beijing, last July, a joint memorandum of understanding was signed on the Global Development Initiative (GDI), which includes a clause about the two sides establishing a mechanism for consultation at the departmental level and working to formulate a strategy for development cooperation for a period of 3 or 5 years. Moreover, letters were exchanged to establish a vocational training center in the Suez Canal Economic Zone, supply 4 sets of mobile security vehicle systems equipment for the Ministry of Transport, and prepare a feasibility study for the biosafety laboratory project. Al-Mashat held extensive discussions during the visit with the Export-Import Bank of China and the China International Development Cooperation Agency (CIDCA).

● Al-Mashat signed several joint cooperation agreements, including a project to localize the metro cars industry in Egypt, manufacturing and supplying 40 train units, as well as enhancing technical support for the process of establishing the Egyptian Authority for Intellectual Property. H.E. also met with officials of the Export-Import Bank of Korea last May to discuss developing a future strategy for cooperation.

● The Council of Ministers decided to form the Ministerial Committee, Unity of India, with the Ministry of International Cooperation being the rapporteur of unity to coordinate between national bodies to set priorities and areas of cooperation with the Indian side.