The Central Bank of Egypt has received a $400 million 12-month loan from the African Export and Import Bank (Afreximbank) to fund small and medium-sized enterprises in the country, Al-Ahram Arabic newspaper reported on Monday, quoting the bank’s vice-president Amr Kamel.
Egypt’s central bank has fully paid off its past loan from Afreximbank which was taken out in November 2016 at the time of the floatation of the Egyptian pound, Al-Ahram reported.
Egypt is at the top of the list for Afreximbank in their plan to enhance intra-African trade, due to the Egyptian economy's variety and ability to penetrate the African market, Kamel added.
Last week, the National Bank of Egypt announced it is allocating $150 million – 20 percent of a $750 million loan it signed in 2017 with an international bank alliance – to finance small and medium-sized enterprises.
The international bank alliance is headed by the European Bank for Development and Reconstruction and includes HSBC, Emirates NBD, Citibank, Bank ABC, Ras Alkhaima, Standard Chartered, the National Bank of Abu Dhabi, Dubai Trade, and the Commercial Bank of Dubai.
In 2016, President Abdel-Fattah El-Sisi introduced an initiative to provide EGP 200 billion over four years in loans for small and medium-sized enterprises through the central bank.
Financing for small and medium-sized enterprises in Egypt reached EGP 8.5 billion at the end of March 2018, compared to EGP 4.9 billion in 2017, an increase of 91.5 percent.
The country’s Financial Regulatory Authority said that financing for small and medium-sized enterprises increased following a decision by the central bank to incentivise banks to finance the booming sector in 2016 in order to create job opportunities and combat poverty.