Egypt received $125 million from the World Bank allocated to support the Upper Egypt Development Programme, Egypt’s Minister of Investment and International Cooperation Sahar Nasr said on Monday. The money is the first tranche of a World Bank fund worth $500 million, according to the ministry’s official website, to be pumped into growing investment and industrial development in the governorates of Sohag and Qena.
The World Bank loan will “focus on the competitive advantage of each of [those governorates] to attract more local and foreign companies to invest,” the ministry statement read. Egypt and the World Bank launched the Upper Egypt Local Development Programme in March.
The $500 million loan is intended to help create jobs in Upper Egypt by enhancing the business climate and improving infrastructure and the delivery of services, according to a previous statement by the bank. Asad Alem, the regional director of the World Bank in the Middle East and North Africa, said he was pleased to support government efforts to develop areas in need in Egypt.
Alem said the programme would improve competitive advantage in local economic sectors, develop infrastructure and provide services to the citizens of Egypt’s two lowest growth governorates. Sohag and Qena were chosen based on population size, poverty rates, geographic location, and economic potential to achieve equality in the allocation of resources and raise the living standards for residents of those governorates.
The programme aims to raise economic growth rates, create sustainable job opportunities by improving the business environment, and build the infrastructure required for growth in productive sectors and developing industries such as food, Nasr added. The fund also aims to develop industrial fields in the economic zones of Upper Egypt, and expand basic service provision including water, sanitation, roads and gas.
The minister said the programme would also pump investment into job opportunities for youth and women, granting incentives to investors who work in the neediest areas, under a newly approved investment law. Earlier this month, Egyptian President Abdel-Fattah El-Sisi ratified a long-awaited investment law that grants investors a number of incentives including tax breaks.
Egypt is also set to receive in December the third and final $1 billion tranche of a $3 billion loan from the World Bank.
In late March, the World Bank announced that it had handed over the second $1 billion tranche to Egypt, with the funds intended to help with fiscal consolidation, ensuring Egypt’s energy supply and enhancing competitiveness in the private sector. Egypt received the first tranche of the loan in September, 2016. According to the bank’s data, the current portfolio of the World Bank in Egypt includes 26 projects for a total commitment of $5.92 billion.
In May, the Central Bank of Egypt said the country’s foreign reserves edged up to $28.641 billion by the end of April, from $28.5 billion at the end of March. Egypt’s foreign reserves have been climbing since it clinched a $12 billion three-year loan from the International Monetary Fund in November, in a bid to lure back capital.
Source : Egypt Daily News