The World Bank has approved $700 million in financing to support Egypt’s private sector, economic resilience and green growth.
The Development Policy Financing operation is designed to help Egypt address short-term economic challenges while advancing structural reforms to spur private sector growth.
It also aims to hasten Egypt’s green transition, including by scaling up renewable energy and increasing efficiency in the electricity, water and sanitation sectors.
Egypt’s minister of international cooperation, Rania Al-Mashat, said: “The government of Egypt is undertaking ambitious economic and structural reforms aimed at creating a more competitive, green and private sector-led economy.
“Through this budget support instrument, the DPF with the World Bank helps advance policy reforms on three of its top national priorities: Building macro-fiscal resilience, enhancing economic competitiveness and improving the business environment, and supporting the green transition.
“Our longstanding partnership with the World Bank underpins the realization of Egypt’s development and reform efforts.”
The DPF is the first in a series of three operations.
It will advance key reforms, including strengthening governance for state-owned enterprises, empowering the the Egyptian Competition Authority, ensuring accuracy in payroll taxes, scaling up renewable energy and launching a voluntary carbon credit market regulatory framework.
In March, the World Bank Group announced a three-year $6 billion program to support Egypt.
“Creating good, sustainable jobs and building resilience to climate change are critical for the current and future prosperity of Egypt’s citizens — especially the poor and vulnerable,” said Stephane Guimbert, World Bank country director for Egypt, Yemen and Djibouti.
“Reforms supported by this operation are an important step toward a more sustainable, inclusive economy,” he added.
Egypt’s Ministry of International Cooperation said that the DPF is aligned with the World Bank and Egypt’s Country Partnership Framework for FY2023-FY2027.
The framework is based on research by the World Bank Group on Egypt, including the Country Private Sector Diagnostic and the Country Climate and Development Report.
Of the $700 million in the DPF, $200 million is contingent on complementary financing from development partners.
The ministry added that the DPF aligns with Egypt’s development priorities and national strategies, including the Sustainable Development Strategy Vision 2030, the State Ownership Policy, the National Climate Change Strategy 2050, and the Nexus of Water, Food and Energy.