The board of the African Development Bank approved a $22 million Senior Loan to help Egypt’s Corporate Leasing Company (Corplease) expand its operations in the North African country.
The decision signalled confidence in a burgeoning local market and in the Egyptian economy as a whole.
The Bank will mobilise $7 million of the $22 million from the Africa Growing Together Fund (AGTF), a co-financing fund, established with the People’s Bank of China.
Corplease is a leading non-bank financial institution that provides diverse leasing products and services to a wide range of SMEs and larger corporates, through direct leasing, sale and lease-back, as well as structured finance products.
Corplease seeks to provide alternative financing through leases to address funding constraints in Egypt’s private sector.
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“The need for leasing products in Egypt is growing consistently on an annual basis to meet the acute demand by small, medium and large-sized corporates for an alternative source of funding from traditional banking sources, for business expansion and job creation. With the annual demand growth expected from the local corporates, the market for leasing in Egypt shows immense potential for investors,” said Stefan Nalletamby, the acting vice-president for the private sector, infrastructure and industrialisation complex at the African Development Bank.
Loan to support existing initiatives
With the newly-approved Corplease loan, the African Development Bank adds to its existing initiatives to support financial institutions and deepen financial systems on the continent.
“The loan will contribute to supporting SMEs operating in Egypt, especially in priority sectors such as agribusiness and food industries, tourism, ICT, clean energy, health, transport and manufacturing – all essential contributors to inclusive and sustainable growth,” said Malinne Blomberg, the African Development Bank’s country manager in Egypt.