HomeIndustry SectorsFinance and PolicyIFC to increase lending to Egypt in support of renewables

IFC to increase lending to Egypt in support of renewables

The World Bank’s private sector lending arm, the International Finance Cooperation (IFC), has announced plans to increase its lending capacity to Mena countries by around 20% to $2 billion in its current financial year, The National reported.

Egypt has been earmarked to receive $1 billion of this loan – triple from around $300 million in the previous 12-month period – of which $700 million will be used toward renewable energy projects.

In the Mena region, the IFC is focusing on infrastructure lending, particularly for renewable energy projects. Read more…

According to The National, around half of last year’s IFC lending to Mena went to climate-related activities.

Egypt growth and development in the spotlight

The National reported: “Egypt is implementing a slew of reforms that helped the North African country get a $12 billion loan from the International Monetary Fund (IMF) last year. These reforms include floating its currency in November and cutting energy subsidies.”

Mouayed Makhlouf, IFC’s Mena director, said: “What helped is the reform of the Egyptian government and the very strong IMF programme that was adopted and agreed to with the IMF.

“The very strong reforms [in Egypt] we haven’t seen in any other government in the region and we hope others follow, especially in North Africa.” Read more…

Green bonds

The IFC helped structure a €135m (Dh585m) green bond issued by Moroccan lender Banque Centrale Populaire in June, the first of its kind in the region, to invest in renewable energy in the North African country, The National reported.

Adding that the lender bought €100 million ($117 million) in the 10-year bond, while the remainder was bought by French development agency Proparco.

The IFC is hoping to help structure similar bonds to support renewable energy initiatives in Lebanon, which is exploring wind power projects, and Jordan, where the lender is investing in a number of clean energy projects, said Makhlouf.

“The challenge is who buys the bonds. We bought into the first one just to give comfort to the market and so that in the next issuance other investors can come in,” Makhlouf said.

Featured image: Stock

Ashley Theron
Ashley Theron-Ord is based in Cape Town, South Africa at Clarion Events-Africa. She is the Senior Content Producer across media brands including ESI Africa, Smart Energy International, Power Engineering International and Mining Review Africa.