Egypt secures US$93m from EBRD to fund infrastructure development

EGYPT – The Government of Egypt has secured a US$93 million (LE1.5 billion) from the European Bank for Reconstruction and Development (EBRD) to fund infrastructural development in the country.

EBRD while announcing the funds approval revealed that the money will be used to support Egypt’s New Urban Communities Authority (NUCA) plans to develop new sustainable towns on Egypt’s expansive deserts.

EBRD further explained that the funding to NUCA will bring the Bank’s total contribution to the Egyptian agency to US$187 million and will be part of the LE 20 billion bond programme that the agency launched.

 The bond program issued El Taamir, the securitisation special purpose company of NUCA is part of Agency’s plan to diversify funding sources by tapping the debt capital market

 “This alternative way of financing urban infrastructure development will help NUCA to free up much-needed resources and continue developing new sustainable towns on desert land,” EBRD said.

The European Bank for Reconstruction and Development further noted that NUCA’s initiative will help relocate some of Egypts population from the narrow strip of the Nile Delta, stimulate the economy, and create new job opportunities.

NUCA has so far successfully developed more than 20 cities in Egypt, attracting strong support of the private sector including developers and contractors.

The EBRD’s subscription to NUCA will also have an added benefit to the Egyptian economy as it will support the development of the local currency bond market in Egypt.

The securities will be listed on the Egyptian stock market as the largest issuance in the history of the local capital bond market with a maturity that is among the longest available.

Last month, the European Bank for Reconstruction and Development said that it is supporting the Egyptian Economy with a $ 200 million financing package to National Bank of Egypt (NBE) for trade and for lending to local companies impacted by the coronavirus pandemic.

The Bank, also agreed to provide Egypt with €1.1 billion in funding to support Egypt’s transport sector.

Egypt’s Minister of International Cooperation, Rania Al Mashat clarified that the objective of financing the urban transport sector with € 1.1 billion was to enhance the transition from private cars to a more efficient means of transportation.

The projects financed within this framework include the renovation and expansion of Raml Tram in Alexandria, the renovation and development of the Abu Qir railway in Alexandria, converting it into an electric metro, and the renovation and development of the Cairo Metro Line 2.

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