Egypt and the German Development Bank (KfW), on behalf of the German Federal Ministry for Economic Cooperation and Development (BMZ), have signed a €54 million ($59 million) debt swap agreement on Sunday.
The Ministry of International Cooperation, as well as the Ministry of Electricity and Renewable Energy and the Central Bank of Egypt were signing from the Egyptian side.
The agreement will see Egypt be exempted from repaying debts amounting to €54 million as it will direct the amount into new green projects.
“The agreement will help the Egyptian government achieve its goal of producing 42 percent of its electricity grid and enhancing its capacity,” said the embassy.
Among the projects is the construction of two sub-stations and the connection of two wind farms, Amunet and Red Sea Wind Farm, with a capacity of 500 megawatts each to the national transmission network.
The project will be implemented in collaboration with the Egyptian Electricity Transmission Company, the embassy added.
“In line with this commitment, Germany provided a funding package of over €250 million for the same purpose, including debt relief, grants and highly concessional loans,” the embassy stated.
The German government pledged during the 27th UN Climate Change Conference (COP27) in Sharm El-Sheikh in 2022 to contribute significantly to Egypt’s Nexus on Water, Energy and Food (NWFE) programme.
