The European Bank for Reconstruction and Development (EBRD) announced on Monday that it is securing a $50 million loan to Qatar National Bank ALAHLI (QNB ALAHLI)to boost small businesses and green investments in Egypt.
The loan, which includes $7.5 million of concessional finance from the Green Climate Fund (GCF), will be used for on-lending to households and local small and medium-sized enterprises (SMEs) in the North African country.
The European Union (EU) will support the financing to QNB ALAHLI with up to €5.128 million ($6 million) of EU funds for incentive payments to projects that are successfully implemented and verified. It will also provide a comprehensive technical assistance package of up to €6.2 million for all participating financial institutions and their clients, as well as for policy dialogue.
QNB ALAHLI is now the first bank in Egypt to benefit from a loan under the GCF GEFF Regional Egypt Framework, the second Green Economy Financing Facility (GEFF II) in the country.
To date, the cooperation between the EBRD and QNB ALAHLI on various projects is worth more than $ 720 million cumulatively, and has a special focus on SMEs, women-led businesses, and green financing, the EBRD further said in a statement.
QNB ALAHLI is set to extend the EBRD’s financing to private sub-borrowers, including individual households and SMEs, operating in the residential, agribusiness, industrial, commercial, and service sectors, who are developing green, energy efficiency, water efficiency, renewable energy and resource efficiency projects.
This will promote the use of high-performance technologies and services in climate-mitigation and climate-adaptation activities, and will help with the transition to a greener economy, EBRD statement added.
In Egypt and the southern and eastern Mediterranean region, it is the first programme of this kind to have both a retail and a residential segment.
“We are very happy to roll out GEFF II in Egypt with the EU and GCF’s support to promote green investments, in line with our Green Economy Transition strategy.” Heike Harmgart, EBRD Managing Director for the southern and eastern Mediterranean, said.
“Through our partnership with QNB ALAHLI we have been able to support small businesses and trade and to increase finance for greener projects.”
Meanwhile, Mohamed El Dib, chairman and managing director of QNB ALAHLI, said: “It gives us great pleasure to cooperate with the EBRD in this remarkable transaction, which is in line with our ambitions to support Egypt’s business and social communities and its economic development, with particular emphasis on the development of the SME and retail segments, as well as the promotion of a greener economy.”
Egypt is a founding member of the EBRD, and since the start of its operations there in 2012, the bank has invested more than €7.7 billion in 132 projects in the North African country. The EBRD’s areas of investment include areas of financial sector, agribusiness, manufacturing and services, as well as infrastructure projects such as power, municipal water and wastewater services, and contributions to the upgrade of transport services.
