CAIRO: Egypt and the World Bank signed an agreement to provide a $500 million loan, to finance an affordable government housing project, according to a Wednesday Cabinet statement.
Prime Minister Ibrahim Mahlab witnessed the agreement signing in the presence of President of the World Bank Group (WB,) Jim Yong Kim, on the sidelines of African Blocs’ tripartite summit held in Sharm el-Sheikh.
Under the agreement, the loan will be used to widen mortgage for low-income- people, according to the statement.
The total portfolio of mortgage firms in the Egyptian market is estimated at 2.5 billion EGP ($327.65 million,) head of the Egyptian Financial Supervisory Authority (EFSA) Sherif Sami announced in May.
Speaking at the “Mortgage Development Partners” conference held in May, Sami said, “difficult procedures and high-cost requirements are the key reasons behind the weakness of mortgage system in Egypt.”
Meanwhile, the Central Bank of Egypt said it intends to launch a second 10 billion EGP ($1.3 billion) installment of its mortgage initiative within 12 months.
The first installment was launched in February 2013 to stimulate the mortgage sector. The CBE’s initiative was intended to provide chances to low and average-income individuals to acquire housing units under the Mortgage Finance Fund regulations, at 7 and 8 percent interest, respectively.