HomeIndustry SectorsFinance and PolicyThree financiers partner to support climate mitigations in Egypt

Three financiers partner to support climate mitigations in Egypt

The European Bank for Reconstruction and Development (EBRD) has partnered with the European Union and the Green Finance Fund (GCF) to boost the private sector’s climate action in Egypt.

The three institutions will help the Egyptian economy to recover from the effects of both the COVID-19 pandemic and climate change by boosting green finance and the development of value chains for the private sector.

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Climate finance

The EU is providing grants of more than €30 million ($35 million), GCF concessional co-financing, as well as technical assistance of up to $24 million.

The funding will be used by the EBRD together with two local banks to implement two climate action programmes designed to provide sub-loans to businesses for green investments in energy, water and resource-efficient solutions.

The programmes include

  1. Newly launched Green Value Chain programme

The initiative will have a volume of up to €70 million ($83 million) to help small and medium-sized enterprises to invest in advanced technologies and climate mitigation and adaptation solutions that improve competitiveness and enhance the development of green value chains.

The programme also supports activities that enhance equal opportunities for men and women to access finance for green technologies and solutions.

2. The Green Economy Financing Facility (GEFF)

This facility will provide up to €150 million ($177 million) of green finance to SMEs across the agricultural, construction, commercial and manufacturing sectors. The GEFF has already provided €140 million of energy efficiency financing in a previous phase through four partner banks, NBK Egypt, QNB AlahliAlexbank and Arab African International Bank.

The GEFF was initially piloted by National Bank of Egypt in 2014.

Heike Harmgart, EBRD managing director for the southern and eastern Mediterranean region, said: “Egypt has great potential to build a low-carbon future and we are proud to work with our international partners to support the country in achieving a green economic recovery. The private sector is a key player in this process and has strong demand for green finance. We are pleased to build on our successful energy-efficiency programmes and to announce our new Green Value Chain programme aimed at greening SMEs, which are the backbone of the economy.”

Ambassador Christian Berger, head of the EU delegation to Egypt, adds: “The European Union and Egypt cooperate closely to establish a green economy with a strong commitment to moving towards a low-carbon future and to making financial markets more sustainable. There is a need to incentivise green finance across the entire investment chain.

“Together with EBRD, EIB and AFD we have established the first Green Economy Financing Facility in Egypt which has served more than 100 industrial facilities to convert to low carbon schemes and today we are very proud to launch an extension of the successful facility.”

Source: Smart Energy International