According to a CBE statement on Wednesday, the initiative aligns with Egypt's strategy to deepen sustainable finance and bring its financial sector closer to international best practices as environmental and social considerations become increasingly central to investment decisions and economic growth.
To support the process, the CBE has formed a technical working group comprising representatives from the Ministry of Foreign Affairs, International Cooperation and Egyptian Expatriates, the Ministry of Finance, the Ministry of Local Development and Environment, the Ministry of Investment and Foreign Trade, and the Financial Regulatory Authority (FRA).
The group will coordinate the preparation of the Sustainable Finance Taxonomy, ensure cooperation among relevant authorities, and incorporate technical feedback before the CBE issues the framework.
The working group held its first meeting at the CBE headquarters, where participants reviewed the central bank's vision for the taxonomy, international experiences, applicable global standards, and the key challenges and opportunities associated with developing the framework.
The meeting concluded with an agreement to immediately begin the implementation steps needed to prepare the taxonomy, with participants stressing the importance of close coordination throughout the process.
According to the CBE, the Sustainable Finance Taxonomy will provide accurate and verified classifications of sustainable economic activities, offering investors greater clarity on eligible green and sustainable projects.
The framework is also expected to channel more international funding into sustainable investments while improving risk management in project financing through clear classifications and guidance for identifying environmental and social risks.
By establishing a common sustainability framework, the CBE said the taxonomy will help create a more attractive environment for green investment and reinforce confidence in Egypt's sustainable finance market.
Sustainable finance taxonomies have become a key global tool for directing capital toward environmentally and socially sustainable projects. By establishing a common classification system, they help investors, banks, and financial institutions identify eligible green investments, improve transparency, facilitate access to international climate finance, and support the issuance of green financial instruments such as bonds and loans.
Egypt's move aligns with its broader strategy to expand sustainable finance, attract private investment, and mobilize funding for its climate and economic development goals under Egypt Vision 2030.
Attracting more private sector investments into the local market is among the key commitments Egypt pledged under the IMF-backed $8 billion loan programme, which is scheduled to conclude by mid-December this year.
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