close
Monday July 22, 2024

World Bank earmarks $700m for Egypt’s private sector

By News Desk
June 25, 2024
An undated image of World Bank Headquarters in Washington DC. — AFP/File
An undated image of World Bank Headquarters in Washington DC. — AFP/File

WASHINGTON: The World Bank has approved a $700 million loan to help Egypt boost private sector participation in its economy, which has suffered from the fallout of the Israel-Gaza conflict, the organization said Monday.

The program is designed to help address short-term economic challenges, “unleash private sector growth”, build macroeconomic and fiscal resilience, and move the country onto a greener growth trajectory, the World Bank said in a statement.

The green aspects of the loan program will include support for “scaling up renewable energy and increasing efficiency in the electricity, water and sanitation sectors,” it added.The loan forms part of the Bank’s three-year, $6 billion commitment to Egypt announced back in March, which came after the International Monetary Fund (IMF) expanded its own loan program with the country to more than $8 billion to help buttress its economy.

Egypt’s economy is still dominated by military-linked enterprises, and for years focused on expensive infrastructure mega-projects.In recent years, the economy has been hit by a series of challenges, including the war in Ukraine, which pushed up wheat prices, and the start of attacks against international shipping by Yemen’s Huthi rebels following the outbreak of the Israel-Gaza conflict.

Egyptian President Abdel Fattah al-Sisi said earlier this year that revenues from the Suez Canal -- which is a key source of foreign exchange for the economy -- had “decreased by 40 to 50 per cent” because of the attacks.

“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,” World Bank country director for Egypt, Yemen and Djibouti Stephane Guimbert said in a statement Monday.