The European Bank for Reconstruction and Development (EBRD) is partnering with QNB Alahli, one of Egypt’s largest commercial banks, to support small and medium-sized enterprises (SMEs) and energy efficiency projects in Egypt with a $140 million financial package.
The package includes a loan of up to $100 million for on-lending to SMEs and a credit line of up to $ 40 million for energy efficiency investments which consists of $20 million committed by EBRD and $20 million expected to be co-financed by the European Investment Bank (EIB) and supported by a $5.8 million grant provided by the European Union Neighbourhood Investment Facility (EU NIF), EBRD explained.
“With this loan the EBRD is continuing its emphasis on the private sector in Egypt by providing financing for small businesses, which are a crucial part of the country’s economy” it said, adding that “for many of them, access to finance remains an obstacle that holds them back from fulfilling their strong potential to generate growth and provide jobs.”
The SME facility will be accompanied by technical cooperation (TC) to strengthen QNB Alahli’s skills related to SME lending.
These TC activities will be supported by the EBRD’s SEMED Multi-Donor Account and the SEMED Cooperation Funds Account.
“We are very happy to partner again with QNB Alahli to further support the private sector in Egypt, contributing to increasing SME finance” commented Hildegard Gacek, EBRD Managing Director for the southern and eastern Mediterranean (SEMED) region. “In addition, we are very pleased that the financial package will improve Egypt’s energy security through better energy efficiency in the corporate sector and promoting the use of renewable energy.”
“The European Union has provided a €23 million grant through the SEMED Sustainable Energy Financing Facility to help dismantle the numerous barriers that face the private sector and are preventing financial institutions, strategic investors and project managers from operating actively and efficiently in financing sustainable energy projects,” said Diego Escalona Paturel, Head of Cooperation at the EU Delegation to Egypt.
Donors to the SEMED Multi-Donor Account include: Australia, Finland, France, Germany, Italy, the Netherlands, Norway, Sweden, Taipei China and the United Kingdom
The EBRD has invested close to Eur2 billion in Egypt through 36 projects since the start of its activities in the country at the end of 2012.
The Bank’s areas of investment there include the financial sector, agribusiness, manufacturing and services, as well as infrastructure projects such as power, municipal water and wastewater services and contributions to the upgrade of transport services.