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Minister of International Cooperation: the European Investment Bank approves € 1.9 billion in support of Egypt’s transportation and SME financing.

The agreements have been reached following Minister Al Mashat’s meeting with the visiting mission of the EIB to Egypt last February, under the chairmanship of Flavia Palanza, the EIB Director for EU Neighborhood countries, where they have discussed the ongoing bilateral strategic partnership between Egypt and the bank, since 1979. The partnership has led to the successful implementation of various projects in a a diversified portfolio of sectors to support socio-economic development and job creation. The total funding from the EIB is around € 9.7 billion with a current portfolio of ongoing projects that amount to more than € 2.3 billion euros.

The Minister further stated that the agreements was reached between both parties to scale up cooperation in new sectors that contributed to enhancing inclusive economic growth and supporting the private sector, aligned with Egypt Vision 2030 and the UN's Sustainable Development Goals. Dr. Al-Mashat pointed out that the approved funding from the EIB is in accordance to the Ministry of International Cooperations “Global Partnerships for Effective Development Cooperation” strategy that was launched in April 2020, with multilateral and bilateral development partners with a strong strategic narrative to crystallize the value proposition for Egypt in the cooperation space aimed at achieving a circular economy. The Global Partnerships Narrative is based on three pillars: People at the Core, Projects in Action and Purpose as the Driver. The new cooperation portfolio reflect the projects’ alignment with the United Nations SDGs, including SDG 8: Decent Work and Economic Growth and Goal 11: Sustainable Cities and Communities. The objective of financing the urban transport sector with € 1.1 billion is to enhance the transition from private cars to a more efficient means of transportation through improving and upgrading the urban transportation infrastructure, thereby ensuring the achievement of sustainable cities, the Minister noted. The projects financed within this framework include the renovation and expansion of Raml Tram in Alexandria over a total distance of 13.8 km, the renovation and development of the Abu Qir railway in Alexandria over a distance of 22 km, converting it into an electric metro, and the renovation and development of the Cairo Metro Line 2 over a distance of 23 km. The Minister further ascertained that the transport sector is a priority sector for the Government of Egypt as it contributes 4.6% of GDP and provides approximately 6.2% of jobs. The railway line also serves around 500 million people annually, with around 1.4 million citizens daily. The Ministry of International Cooperation has a current portfolio of 30 projects in the transportation sector with a total official development financing of $ 5 billion, with several development partners including the EIB, World Bank Group, EBRD, China, Japan, Korea and France. For his part, Minister of Transportation praised the efforts of the Ministry of International Cooperation and EIB in their efforts on the signing of this framework agreement. “The two projects approved by the Bank are aligned with the EIB strategy in Egypt. In addition, the urban transport projects are part of the EIB strategy to support low carbon emissions projects aligned with Paris Agreement.” said Alfredo Abad, Head of the European Investment Bank Representation for the Near East. The EUR 800m loan to NBE is part of the Tean Europe rapid response to support SMEs in Egypt in the face of the COVID19 crisis. With regards to the € 800 million loan to NBE in support of SMEs to overcome the Covid-19 implications and prepare for recovery. “Supporting Egypt’s private sector is key in the road ahead, building for economically resilient and inclusive communities. The financing of Egypt’s small and medium enterprises; the backbone of our economy to assist their businesses and liquidity needs is a priority going forward” said Minister Al Mashat. It is worth noting that the EIB announced that it would continue to provide the necessary funding to boost inclusive economic growth, with public-private partnerships to enable scaling up of SMEs.