● Al-Mashat: The NWFE program presents an effective model on the African continent and developing countries and enhances development through projects in different governorates of Egypt.
● AfDB President: We strongly support the NWFE program, which is in line with the Bank's five priorities.
● Arab Development Fund Director General: We support Egypt's efforts to enhance water and food security and accelerate the pace of implementation of the components of the NWFE program.
● Egypt has taken concrete steps to enhance sustainable transformation in the agricultural and food security sectors and to promote private sector participation.
● Work is underway to launch 5 desalination plants in 4 governorates with a capacity of 525,000 cubic meters per day, rising to 1.75 million cubic meters per day by 2050.
● Expanding the scope of solar irrigation systems and updating agricultural practices to improve water efficiency and productivity.
The Ministry of International Cooperation reviewed the results of coordination with multilateral and bilateral development partners and national entities over the past year, with regard to the implementation of water projects within the NWFE program, which includes the implementation of three projects: “Water Desalination of Using Solar Energy”, “Expanding Solar Irrigation Systems” and “Improving Agricultural Climate Resilience by Modernizing Agricultural Practices”. This came in the first progress report issued by the Ministry on the developments of the NWFE program after one year of its launch.
Development Impact
The Progress Report pointed out that Egypt has taken concrete steps towards a sustainable development model that is in line with its plans to protect the environment, address climate change, and improve the climate needed to support the participation of the private sector in the development process. The country also launched the National Strategy for Water Resources Development in Egypt until 2050, with the aim of achieving Egypt's water security through sustainable water management. This sustainable management relies on the development and management of limited water resources on the one hand, and the management of current and future water needs on the other hand.
The report noted that in light of these targets, the water pillar within the NWFE program includes three main projects: the first project is “Water Desalination of Using Solar Energy”. This features the launch of 5 desalination plants using solar energy in 4 governorates with a total capacity of 525,000 cubic meters per day. It will increase to 1.75 million cubic meters per day by 2050. This will enhance the green transition and achieve the goals of sustainable development and the implementation of nationally determined contributions as well as Egypt's Vision 2030.
In addition, the second project is “Expanding Solar Irrigation Systems”, which enhances the ability of small farmers to use modern irrigation systems, in order to reduce carbon dioxide emissions and avoid the negative effects of future energy crises and their impact on food production. This project benefits about 1.75 million citizens, and it contributes to achieving the state's plans to increase renewable energy production by about 42% by 2030.
The third project is “Improving Agricultural Climate Resilience by Modernizing Agricultural Practices”. This works to support water efficiency and productivity and the number of beneficiaries is about 7.5 million beneficiaries, focusing on old agricultural lands that use traditional irrigation. The project aims to achieve Egypt’s Climate Change Strategy, inclusive and sustainable economic growth, reducing emissions, and achieving low-carbon development.
The Minister of International Cooperation, H.E. Dr. Rania Al-Mashat, explained that the NWFE program presents an effective and replicable model regionally and internationally, especially on the African continent and developing countries, to implement the commitments related to climate action and enhance efforts to accelerate the transition towards a green economy and stimulate food and water security. H.E. added that the program focuses on regionally concentrated development across the main regions of Egypt; the Nile Valley, the Delta, the Mediterranean coast, the Red Sea, the Eastern Desert, the Suez Canal area, the Sinai Peninsula, the Western Desert, and the Oases.
President of the African Development Bank (AfDB), Akinwumi Adesina, said that the AfDB strongly supports the NWFE program. The program is in line with the Bank's five priorities, which are: "Light up and Power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and Improve the Quality of Life for the People of Africa.”
Director General of the Arab Fund for Economic and Social Development, Badr Al-Saad, stated, “In implementation of the Arab Fund’s strategy in supporting the efforts of Arab countries to implement green projects, confront the repercussions of climate change, and enhance water, food, and energy security. We support the Egyptian government in implementing the NWFE program in accordance withit’s project of pumping water with solar energy, launching water desalination plants with renewable energy, and providing everything that would enhance the government’s efforts to accelerate the implementation of the program components.”
Main Development Partner
The Ministry of International Cooperation statement stated that the AfDB was chosen as the main development partner in the water pillar, given the Bank’s extensive experience in cooperating with the Egyptian government to finance and implement many projects in the water and utilities sector. The bank had also previously provided the necessary financial support to prepare Studies on the use of renewable energy in irrigation systems, in addition to providing many funds to support private sector projects in Egypt and the variety of financial mechanisms and tools it provides in this context. The bank has launched a number of initiatives and mechanisms that seek to enhance green financing and climate action and support the ability of African countries to withstand, adapt and confront climate change.
The AfDB Group’s country strategy with the Arab Republic of Egypt 2022-2026 includes two main axes that are mainly related to the objectives of the NWFE program projects, which are: The first pillar: enhancing the country’s competitiveness to support strong growth led by the private sector to accelerate the green transformation. The second pillar: building resilience to achieve food, water and energy security.
During COP27, signing of a partnership agreement with the AfDB and announcing the Arab Fund for Economic and Social Development as a technical development partner for the project to expand irrigation systems with solar energy took place.
Innovative Financing Tools
The Ministry of International Cooperation’s report highlighted that the estimated cost of the three projects within the water pillar amounts to about $1.4 billion, while pledges from multilateral and bilateral development partners exceeded about $2.3 billion, which reflects the great interest and close relations between Egypt and development partners. These pledges were presented to the AfDB, European Bank for Reconstruction and Development (EBRD), Islamic Development Bank (ISDB), International Fund for Agricultural Development (IFAD), World Bank, Asian Infrastructure Investment Bank (AIIB),and European Investment Bank (EIB).
Technical Qualification Efforts for Projects
The Ministry’s statement indicated that, in an effort to achieve integration between the national efforts made to stimulate investments in the water sector, the NWFE program, within the framework of technical qualification discussions with development partners, aimed to achieve many goals. The most important of which are providing the necessary support to the technical ministries to quickly prepare and prepare the necessary studies for the projects to be implemented, saving the costs of preparing those studies, and providing the necessary technical support and advisory services to quickly propose and contract for the implementation of projects under the “participation with the private sector” system through the resources available from development partners.
The Ministry also worked with development partners to discuss the proposed tools and mechanisms to finance the project and provide appropriate financing conditions to support companies participating in implementation, following the completion of the preparatory phase and the tendering and contracting phase, which is reflected in the final cost of water production, and benefiting from distinguished international experiences in the field of financing desalination projects, striving seriously to reach the optimal framework for financing and implementation, examining investment opportunities available to localize the solar panel industry in Egypt, and formulating proposed tools and mechanisms to stimulate investors and attract the private sector.
Technical Qualification Efforts for Projects
Since the beginning of 2023, a number of technical missions have been received from the main development partners for all water pillar projects on the NWFE program, and a series of technical discussions were held with the relevant ministries, which resulted in a number of outputs and decisions regarding the implementation of these projects.
It was pointed out that linking a number of projects has been achieved, especially in light of the presence of a number of similarities in the general scope of operations and their components. This is in addition to the inclusion of technical ministries for the project and the formation of national working groups that include all relevant agencies and ministries to maximize the benefit from the project operations and the support to be provided for the design and implementation of the project from development partners.
With regard to the “Water Desalination of Using Solar Energy”, it has been completed, providing the necessary financial support to prepare the necessary studies for the project through the two grants to be provided by resources from the Technical Assistance Fund for Middle-Income Countries of the AfDB in the amount of 280 thousand units of account, and from the African Water Facility in the amount of €500 thousand.
The discussions that took place with various development partners to discuss ways to support the implementation of the project helped to strengthen coordination efforts between development partners and maximize development partnerships between them, in an effort to benefit from previous experiences in the field of implementing water desalination projects and the advisory services to be provided for the project. The proposed tools and mechanisms were also discussed in order to finance the project and provide appropriate financing conditions to support the parties involved in implementation, after the completion of the preparatory phase.
With regard to future goals, grant agreements will be signed that were arranged to prepare technical, economic, environmental and social studies for the desalination plants, and the consulting services agreements to be provided for the tender stage and contracts with the private sector to implement the desalination plants will be announced, and the implementation of the project will begin after the completion of the preparatory phase-preparing studies and consulting)-, tendering and contracting stage with companies and investors.
Moreover, for the “Expanding Solar Irrigation Systems” project, work has been done arranging the necessary financial support to prepare the necessary studies for the project through the technical assistance to be provided by the Arab Fund for Economic and Social Development, and forming a national working group that includes all relevant national entities to maximize the benefit from the project operations and the support to be provided for the design and implementation of the project from all development partners. The discussions resulted in the National Technical Technical Committee to include the Ministries of Trade and Industry and Military Production, in addition to the Ministry of Water Resources and Irrigation, with the aim of examining ways to benefit from military production companies to localize the solar panel industry in Egypt with international standards of high quality, discuss investment opportunities available to localize the solar panel industry in Egypt, and formulate proposed tools and mechanisms to stimulate investors and attract the private sector.
Signing the technical aid agreement, provided by the Arab Fund for Economic and Social Development, was scheduled, to help initiative preparation and project design and to begin preparing the necessary studies for the project that are intended to be financed through the Arab Fund. This also includes discussing the tools and mechanisms necessary to localize the solar panel industry in Egypt.
As for the project “Improving Agricultural Climate Resilience by Modernizing Agricultural Practices'', technical qualification discussions that took place with development partners and relevant technical ministries resulted in merging the project with a project from the food pillar, in light of similarities in their general scope and the targeted geographical scope. This helps achieve the maximum possible benefit from the operations that will be implemented within the framework of the project to modernize the irrigation system and promote comprehensive and sustainable rural development.