EBRD, EU, Green Climate Fund to provide $50 mln loan to QNB ALAHLI to support SMEs in Egypt

Doaa A.Moneim , Monday 16 Aug 2021

The cooperation portfolio between the EBRD and QNB ALAHLI includes various projects worth more than $720 million cumulatively, with a special focus on SMEs, women-led businesses, and green financing

Egypt
File Photo: Women work in a factory that makes men's suits in 10th of Ramadan City, Egypt. Reuters

The European Bank for Reconstruction and Development (EBRD) will provide a $50 million loan to Qatar National Bank (QNB) ALAHLI to boost small businesses and green investments in Egypt, the EBRD announced on Monday.

The loan, which includes $7.5 million of concessional finance from the Green Climate Fund (GCF), will be used for on-lending to households and local small and medium-sized enterprises (SMEs).

Meanwhile, the European Union (EU) will support the financing to QNB ALAHLI with up to €5.128 million of EU funds for incentive payments to projects that are successfully implemented and verified, said the EBRD.

It also declared that the EU will also provide a comprehensive technical assistance package of up to €6.2 million for all participating financial institutions and their clients, as well as for policy dialogue.

QNB ALAHLI is the first bank in Egypt to benefit from a loan under the GCF GEFF Regional Egypt Framework, the second Green Economy Financing Facility (GEFF II) introduced by the EBRD in the country.

The cooperation portfolio between the EBRD and QNB ALAHLI includes various projects worth more than $720 million cumulatively, with a special focus on SMEs, women-led businesses, and green financing.

The EBRD clarified that QNB ALAHLI is expected to extend the EBRD’s financing to private sub-borrowers, including individual households and SMEs operating in the residential, agribusiness, industrial, commercial, and service sectors, who are developing green projects that are energy, water, and resource efficient, as well as produce renewable energy.

This will promote the use of high-performance technologies and services in climate-mitigation and climate-adaptation activities and will help with the transition to a greener economy.

This is the first programme of its kind to have both a retail and residential segment in Egypt and the southern and eastern Mediterranean region, according to the EBRD.

“We are very happy to roll out GEFF II in Egypt with the EU and GCF’s support to promote green investments, in line with our Green Economy Transition strategy. Through our partnership with QNB ALAHLI, we have been able to support small businesses and trade and to increase finance for greener projects,” said Heike Harmgart, the EBRD’s managing director for the southern and eastern Mediterranean.

Egypt is a founding member of the EBRD. The bank has invested more than €7.7 billion in 132 projects in the country since the start its operations there in 2012.

The EBRD’s areas of investment include the financial sector, agribusiness, manufacturing, and services, as well as infrastructure projects such as power, municipal water and wastewater services, and contributions to the upgrade of transport services‎.

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