Egypt Secures Over $2 Billion in International Financial Support for Structural Reforms
During the recent Egyptian-European Investment Conference, Egypt successfully negotiated a significant financial accord amounting to EUR1 billion ($1.069 billion) with the European Union. This agreement marks the commencement of a more substantial €5 billion financial commitment, scheduled to commence disbursements in the latter half of 2024. The European Union has pledged extensive macroeconomic and budgetary support, with the remaining €4 billion expected to be released over the period from 2025 to 2027.
In a broader framework of international financial cooperation, Egypt has secured an aggregate of $2 billion in budget support from major development partners, notably the World Bank, the European Union, the African Development Bank (AfDB), and South Korea. Rania Al-Mashat, Egypt’s Minister of International Cooperation, announced this remarkable achievement, highlighting the critical role of these funds in bolstering Egypt’s structural reform initiatives aimed at invigorating the private sector.
World Bank Financing Package: A Substantial Commitment
The World Bank Group has sanctioned a comprehensive financing package valued at $700 million, composed of $500 million from the World Bank itself and an additional $200 million from other partners. This funding forms part of the World Bank’s broader commitment to invest $6 billion over three years in support of Egypt’s economic and structural reforms. Of this $6 billion allocation, half will be directed towards the government, while the remaining half will empower the private sector. The loan terms extend to 35 years, inclusive of a 5-year grace period.
Agreements with AfDB, KDCF, and AIIB: Expanding the Financial Network
Egypt has also formalized a $131 million agreement with the African Development Bank (AfDB) to foster private sector growth. This agreement was signed during Minister Al-Mashat’s attendance at the AfDB annual meetings in Kenya last June. To further diversify its financial sources, Egypt secured $100 million from the Korean Economic Development Cooperation Fund (KDCF) during the Korea-Africa Summit.
Furthermore, ongoing negotiations with the Asian Infrastructure Investment Bank (AIIB) aim to secure an additional $300 million in financing, signaling Egypt’s strategic efforts to attract robust international investment for its ambitious reform agenda.
This exceptional confluence of international financial support underlines Egypt’s successful diplomatic and economic strategy, positioning the nation for sustained growth and private sector expansion.
Source: Economy Middle East
