Climate finance to boost the Egyptian economy impacted by Covid 19. This is the solution advocated by several international donors including the European Union (EU), the United Nations (UN) Green Climate Fund (GCF) and the European Bank for Reconstruction and Development (EBRD). These development partners are providing €220 million to the country of the pharaohs.
The funds are allocated through two programmes with local banks, partners of the EBRD. The first programme, called “Green Value Chain”, will enable small and medium-sized enterprises (SMEs) to invest in cutting-edge technologies and climate mitigation and adaptation solutions that improve competitiveness and foster the development of green value chains. The programme also supports activities that improve equal opportunities for men and women to access finance for green technologies and solutions. The programme aims to provide $70 million to SMEs.
Energy and water financing
The second programme, with a budget of $150 million, is an extension of the Green Economy Financing Facility (GEFF). The EBRD’s GEFF supports businesses and owners wishing to invest in green technologies. The GEFF programme is implemented through a network of more than 140 local financial institutions in 26 countries, supported by more than €4 billion of EBRD funding. In Egypt, the extension of the GEFF will benefit SMEs in agriculture, construction, trade and industry.
“The facility has already provided €140 million in energy efficiency financing in a previous phase through four partner banks, NBK Egypt, QNB Alahli, Alexbank and Arab African International Bank, all of which have benefited from EU grants. The GEFF was initially piloted by the National Bank of Egypt in 2014,” the EBRD said.
Supporting the GEFF
According to the EBRD, the aim of the Green Value Chain programme and GEFF is to provide loans to companies for green investments in energy and water efficient solutions. These programmes are complemented by EU grants of more than €30 million and concessional co-financing from the GCF as well as technical assistance of up to $24 million.
The €220 million received by local banks will be lent to Egyptian SMEs for the development of green technologies such as energy-efficient production machinery, renewable energy applications, agricultural irrigation and rainwater harvesting equipment, etc.
Jean Marie Takoule