To date, 950 export companies have submitted their applications to benefit from the instant cash repayment initiative that aims to disburse companies’ arrears from the Export Development Fund (EDF) before the end of FY 2020/2021 (ending in June), Minister of Finance Mohamed Maait said on Wednesday.

Maait added that the second stage of the presidential initiative, meant to support the exports sector, was launched on 7 February. The initiative is seeing marked demand owing to the benefits it extends.

The government announced the closing date for receiving applications is 28 February.

The initiative contributes to providing cash liquidity that enables export companies to fulfil their financial obligations, keep their labour force, and boost the competitiveness of Egyptian products in international markets amid the crunch caused by the coronavirus, Maait said.

In September, Egypt launched the first stage of the initiative that targeted instant and cash repayment of export companies’ arrears from the EDF before the end of 2020 at a repay acceleration discount of 15 percent.

Some 1, 069 export companies benefited from the first stage, with total disbursements of EGP 13.5 billion, according to the minister.

The initiative is implemented in collaboration with the banking system. The finance ministry deposited a guarantee at the Central Bank of Egypt to allow the payment of arrears of companies that join the initiative and are willing to pay their entire dues, stated Maait.

He added that the finance ministry will repay the sums and their proceeds to the banks that participate in the initiative over three years.

The minister revealed that the government disbursed EGP 21 billion in a year to support the exports sector through six initiatives.

Nevine Mansour, advisor of the finance minister's deputy for financial policies, said that 2,500 export companies benefited from the other five initiatives with a total of EGP 5.6 billion disbursed for exports in FY 2019/2020 and EGP 2.4 billion disbursed from July to November 2020.

The cabinet has approved five initiatives since October 2019 to settle the exporters’ arrears through June 2019.

The initiatives included repaying small investors a maximum of EGP 5 million, the repayment of 30 percent of the whole arrears to the exporters, holding a set-off between the exporters’ arrears and the payable tax and custom obligations on them, the repayment of the total arrear sums over four to five years while expanding their investments in return, and the land allocation initiative.