On the side-lines of Egypt Economic Development Conference (EEDC) in Sharm El Sheikh, the European Union and the government of Egypt signed on Saturday a Memorandum of Understanding (MoU) and Joint Declarations to support social and economic development in Egypt with a grant contribution of €130 million. The European Investment Bank which is the Bank of the European Union signed a loan of €120 million with the National Bank of Egypt (NBE) for supporting private sector companies in Egypt.
Mr. Christian Danielsson, Director-General in charge of Neighborhood and Enlargement Negotiations at the European Commission, Mr. Ambroise Fayolle, Vice-President of the European Investment Bank (EIB) and H.E. Naglaa El Ahwany, Egypt’s Minister for International Cooperation have signed the documents in the presence of media representatives attending the conference. Moreover, the “EU Joint Rural Development Program” jointly funded by the EU with a grant of €22 million and the Italian cooperation with €11 million was officially launched that same day with HE the Ambassador of Italy Maurizio Massari.
The Memorandum of Understanding (MoU) concerns the EU Single Support Framework (SSF) for Egypt for 2014-2015 which reflects the sectors of bilateral cooperation mutually agreed upon by Egypt and the EU for that period. The SSF focuses on a limited number of priorities taking into consideration Egypt’s reform agenda, the need to ensure ownership and reinforce development partners’ coordination, and allocates for the two years in question an indicative total amount of EUR 210-257 Million in EU grants to Egypt.
The priority areas for EU-Egyptian cooperation during 2014-2015 established by the MoU are; Poverty Alleviation, Local socio-economic development and Social Protection (40% of total), Governance, Transparency and Business Environment (20%) and Quality of life and environment: (40%).
The Joint Declaration between the Government of the Arab Republic of Egypt and the European Union – that is also being signed in Sharm El Sheikh today – is based on the commitments of the Memorandum of Understanding for 2014-2015. In particular, it reflects the joint decision by Egypt and the EU taken in 2014 to develop three new grant programs for a total EU contribution of EUR 130 Million. These programs are: “Access to Education and Protection for at Risk Children” program, with an EU contribution of EUR 30 Million, “Household Natural Gas Connection” program for EUR 68 Million and “Kafr El Sheikh Wastewater Expansion” program, with an EU grant amounting to EUR 32 Million.
To position Egypt as an attractive destination on the global investment map, the joint declaration between the government of Egypt and EIB will be focused on improving socio-economic infrastructure in key sectors as energy, transport, urban development and Public-Private Partnerships and supporting private sector development in the domains of industry, Foreign Direct Investment, SMEs. In line with these priorities and running quickly, the EIB has already identified a pipeline of projects which the Bank can support with financing in excess of €2bn.
The EIB loan of €120 million with the National Bank of Egypt (NBE) is focused on small and medium-sized enterprises (SMEs) implementing projects in productive and service sectors. With this credit line, the EIB decided to support Egypt in a very concrete way in its efforts to boost the development of the private sector and thus promoting the productivity and the competitiveness of the Egyptian economy while balancing the needs for increased job creation in Egypt. Since it began operations in Egypt in 1979, the EIB has financed more than 90 projects, both in the public and private sector, for an amount of €6.3 billion in loans and private equity, leveraging a total investment value of over €20 billion.
The Egypt Economic Development Conference (EEDC) also provided the setting for the official launch of the “EU Joint Rural Development Program”. This EUR 39 Million project was signed in late 2014 between the GoE, the EU and Italy, and will drive forward the development of the agricultural sector and rural areas in Egypt. The first project component, relating to rural development, will be implemented by the Italian Cooperation Office and disposes of EUR 22 Million of the EU grants and parallel co-financing of EUR 11 Million of the Italian Cooperation Office. The second component is on demining activities in rural El Alamein is financed by the EU with an additional EUR 4.7 Million.
All EU programs and aid initiatives for 2014 and 2015 complement the already existing, very substantial portfolio of ongoing EU cooperation with Egypt. This portfolio consists of EU commitments for more than EUR 1 Billion, and covers a large variety of aid sectors, partners and modalities. Almost 50% of this EUR 1 Billion of EU grants is provided for human and social development. Those include education, health or local development projects. More than one third of the total has been allocated to sustainable infrastructure and environmental protection. The remaining grants, amounting to approximately EUR 150 Million, support important initiatives for economic development, trade and innovation, as well as governance and human rights.
The press release is the responsibility of its author, the European Union, and does not reflect the editorial policy of The Cairo Post.