Egypt secures $15.6bn in concessional financing for private sector since 2020: El-Mashat

Daily News Egypt

13 hours ago

Minister of Planning, Economic Development, and International Cooperation Rania El-Mashat announced during the 'Development Finance to Foster Private Sector-Led Growth & Jobs' conference that concessional development financing for Egypt's private sector reached $15.6bn between 2020 and May 2025. This financing was provided through more than 30 bilateral and multilateral development partners, with banks and financial institutions accounting for 40% of the total.
El-Mashat emphasized that the conference reflects Egypt's strategic shift toward a private-sector-led economy based on competitiveness, partnerships, and sustainability. She highlighted the critical role of development finance in boosting private investment and job creation.
The government continues to implement a structural reform agenda focused on macroeconomic stability, enhanced competitiveness, a stronger investment climate, and advancing green transformation efforts.
El-Mashat noted that the annual global financing gap to achieve the Sustainable Development Goals (SDGs) is estimated at $4 trillion, according to the UN's 2024 data. However, private sector mobilization through development finance remains below $70bn, based on OECD figures—underscoring the urgent need to scale up such financing.
To help bridge this gap, the ministry launched a comprehensive economic diplomacy framework in 2020 to deepen cooperation with international financial institutions and expand the use of innovative financial tools targeting all segments of the private sector—including large corporations, SMEs, microenterprises, startups, and entrepreneurs.
In response to the need for clearer communication and coordination between development partners and the private sector, the ministry also introduced the 'Hafiz' platform. The platform provides over 90 services and lists more than 1,000 local and international opportunities, positioning itself as a key entry point for partnerships and technical support.
These combined efforts have facilitated development projects across multiple sectors, with total development financing exceeding $15.6bn since 2020. In addition, technical support projects valued at more than $200 million have delivered advisory services, technology transfer, and training to build private sector capacity and broaden market access.
One of the notable outcomes includes the acceleration of PPP project implementation—reducing preparation timelines from one year to just two months—thanks to secured funding for feasibility studies and the appointment of legal, technical, and financial consultants.
Banks and financial institutions have received over 40% of the total development finance since 2020, while renewable energy, electricity, and logistics sectors together accounted for more than 25%.
El-Mashat also announced that Egypt has been selected by the Climate Investment Funds (CIF) as one of only seven countries globally to benefit from its Green Industry Program, which will provide $1bn in concessional financing and technical support to drive green industrial investment.
Additionally, she introduced a new coordination mechanism for the European Fund for Sustainable Development Plus (EFSD+), which will offer project guarantees worth €1.8bn. These guarantees, provided through institutions such as the European Investment Bank (EIB), the EBRD, the German Development Bank (KfW), the IFC, and others, aim to attract greater private investment in sectors including renewable energy, food security, human capital, and infrastructure.
The minister further noted that Egypt is working to strengthen South-South cooperation and expand market access for Egyptian companies through concessional financing and joint initiatives with partner countries, reinforcing Egypt's emerging role as a regional development and investment hub in Africa.
She also revealed that preparations are underway to launch Egypt's national economic development narrative, in collaboration with the World Bank Group. This narrative will define key reform priorities to enhance exports, support local industries, and attract foreign direct investment, thereby contributing to long-term economic stability.
€1.8bn Investment Guarantee Mechanism Launched
During the conference, Egypt and the European Union unveiled a new €1.8bn Investment Guarantee Mechanism under the EFSD+ initiative.
Part of the EU's broader External Investment Plan, the EFSD+ platform seeks to enhance sustainable investment in partner countries, including Egypt. It promotes greater private sector participation by offering innovative financial tools such as guarantees, concessional loans, and blended finance instruments to reduce investment risks and encourage engagement in key sectors like water, energy, agriculture, climate, infrastructure, and digitalization.
El-Mashat stated that the mechanism represents a shared commitment between Egypt and the EU to deepen private sector involvement in development. Companies will be able to access investment guarantees through the 'Hafiz' platform, which also offers concessional financing via partner banks, EU-backed risk guarantees, technical assistance, and opportunities in infrastructure and green projects supported by the EU.
The guarantee mechanism is supported by key international financial institutions, including the EIB, EBRD, KfW, IFC, and Italy's CDP. These partnerships aim to increase concessional development financing to Egypt's private sector across strategic sectors.
Stefano Sannino, Director-General for the Southern Neighbourhood and Middle East at the European Commission, described the initiative as a strategic platform to unlock diverse financial solutions and catalyze investment in Egypt. Under the 'Team Europe' framework, the EU aims to position itself as a long-term economic partner in Egypt's sustainable development. The mechanism is expected to mobilize up to €5bn in public and private investments between 2024 and 2027.
$4.2bn in Development Finance Mobilized in 2024
According to the Ministry's Development Financing for Private Sector Empowerment report, Egypt's private sector received over $4.2bn in development financing in 2024—surpassing, for the first time, financing directed to the public sector. This signals a growing shift among development partners toward empowering the private sector as a key driver of the SDGs.
From January to May 2025, financing reached $1.14bn, reinforcing expectations of sustained momentum. In total, development financing to the private sector between 2020 and May 2025 amounted to approximately $15.6bn, supported by more than 30 development partners.
The European Bank for Reconstruction and Development (EBRD) led all contributors, accounting for 22% of the total. The European Investment Bank (EIB) followed with 21%, reflecting the significant role of European development partners—both bilateral and multilateral—in financing infrastructure and supporting private sector growth in Egypt. Together, European partners have provided approximately $7.3bn, or 47% of the total. The IFC ranked third with a 19% share, underscoring its focus on supporting SMEs and fostering direct investment.