The Central Bank of Egypt (CBE) has approved new facilities for the tourism sector that aim to support it amid the ongoing pandemic, the CBE announced on Wednesday.

The new facilities include raising the finance share that was introduced by banks to renew or replace hotels, marinas, and touristic transport fleets to 90 percent, up from 75 percent, of the total cost of the renewable operations.

They also include increasing the share of the Credit Guarantee Company — as a credit risk guarantee — on the extended facilities to 70 percent, up from 60 percent, while the banks bear the remaining 30 percent.

Concerning the EGP 3 billion tourism support initiative, which the finance ministry launched in May 2020, the CBE extended the validity of the initiative to the end of December 2021, instead of June, and extended the related grace period to the end of June 2022.

The first instalment under the extension will be due in June 2022.

The CBE also allows individuals and entities who benefitted before from the initiative to tap it again, provided that the total extended finance does not exceed EGP 30 million for the client and EGP 40 million for the client and his related parties.

The CBE said that the initiative allows the beneficiaries to tap it even if they did not post profits in 2020.

In May 2020, the Ministry of Finance launched an initiative to support the tourism and hotels sector against the harsh impacts of the COVID-19 pandemic.

The initiative came in response to President Abdel-Fattah El-Sisi’s orders to support the economic and productive sectors affected by the spread of the virus.

The initiative includes offering EGP 3 billion in insurance credit for the CBE to give to national banks to provide three-year loans to hotels and touristic facilities with a five percent interest rate, Maait said.

The initiative covers the salaries of employees working in hotels and touristic facilities, which have to provide lists with employees’ names and bank accounts for their salaries to be directly transferred.

The initiative also covers operation costs and employees’ salaries in small and medium-sized enterprises.

A committee comprising representatives from the Ministry of Finance, the CBE, the Ministry of Tourism and Antiquities, and banks that will offer loans was formed to follow up on the implementation of the initiative.

Egypt is optimistic about welcoming more visitors in 2021, with numbers increasing steadily since January to around half a million tourists a month, Minister of Tourism and Antiquities Khaled El-Enany announce on Sunday.

Tourism revenues are a key source of foreign currency and account for 15 percent of Egypt’s GDP.

Egypt’s tourism was among the most-hit sectors by the pandemic in 2020, losing 70 percent of its revenues, according to the tourism ministry’s data.

Monthly tourism revenues stood at about $500 million in April, half of what they were before the pandemic. But Egypt hopes for a recovery by the end of the year, when it aims to have vaccinated staff in resorts along the Red Sea and name the area a COVID-free destination, Enany said.

“More than 65 percent of tourists are coming to the Red Sea and South Sinai governorates because they are open air spaces and there are water activities. It is exactly what the tourist is seeking after COVID,” the minister told Reuters in an interview.

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