By Mary Hearty
The African Development Bank (AfDB) has approved 225 mn Euros funding for Egypt’s Electricity and Green Growth Support Program (EGGSP) to boost the electricity sector during the novel coronavirus pandemic.
The support loan is expected to cushion Egypt’s economy during this difficult time by meeting the financing requirements and supporting the electricity infrastructure base.
Consequently, this will help mitigate the country’s competitiveness including the private sector.The newly approved program which is a continuation of AfDB partnership with the Egypt government seeks to promote a sustainable, competitive and diversified electricity sector.
“The EGGSP aims to improve the security of energy supply by increasing the share of renewable energy and improving the financial sustainability of the electricity sector with a view to ensuring greater participation of the private sector in injecting more investments in renewable energy,” said H.E. Dr. Mohamed Shaker, Minister for Electricity and Renewable Energy.
Following the previous years, Egypt has implemented robust reforms aimed at correcting macroeconomic imbalances and improving the business environment and fostering inclusive growth.
This progress, however, is threatened by the impact of COVID-19 on the different economic sectors, including the power sector, and on the vulnerable.
However, the provided financial aid will reinforce the directives put in place by the Government of Egypt to help stop the spread of the coronavirus as well as protect the most vulnerable amid the pandemic.
In addition, it will help facilitate new private investments in the electricity sector, also increase the deployment of clean energy in line with Egypt’s objectives for green growth.
“While the pandemic has put extreme pressure on the economy and the social situation, the economic reforms undertaken by the Government of Egypt and the Central Bank of Egypt over the few years have helped create greater resilience and provide a buffer against shocks such as the COVI-19 pandemic,” said Yacine Fal, the Bank’s deputy Director General for the North Africa Region.
Furthermore, the Bank is collaborating with the French Development Agency (AFD) and Japan International Cooperation Agency (JICA) on the Program in order to meet the needs in light of COVID-19 as well as the recovery phase that will follow which depends on an efficient and sustainable energy sector.
“Accelerated deployment of the EGGSP reform program is instrumental to meet energy needs, combat climate change and promote sustainable development in Egypt,” concluded H.E. Dr. Rania Al Mashat, Minister of International Cooperation.