These meetings will be the first to be held in person since the onset of the pandemic in late 2019.
The EBRD said that — as per its recent commitments at the UN’s Conference of Partners (COP26) and the Paris Agreement — it aims to increase its green investments to more than 50 percent of the total business volume by 2025.
It is expected to showcase how its partners and country members could benefit from such commitments in the meetings.
In its 29th annual meetings, held in 2020 virtually, the EBRD named Egypt as the largest country of its operations and investments in the Mediterranean region for the third year in a row.
The EBRD invested a total of €1 billion in Egypt in 2020.
The EBRD’s country strategy draft for Egypt revealed
At the same time, the EBRD published on Thursday the draft of its country plan for Egypt from 2020 through 2027, which is anticipated to come into effect by February 2022.
“Following the Arab uprisings in 2011 and a drop in growth, Egypt’s economy made a strong recovery thanks to fundamental macroeconomic and structural reforms. Supported by two IMF programmes in recent years, growth reached 5.6 percent in FY2018/19 on the back of significant public investments and domestic consumption, accompanied by a primary budget surplus, sustainable debt levels, and stronger foreign reserves,” the draft said.
It also pointed to the significant efforts made by the country to increase socio-economic inclusion, particularly for youths and those living in remote and rural regions, as well as to improve the operations and governance of state-owned enterprises (SOEs) and the civil service.
Regarding the green transition, the draft said that Egypt has made noticeable progress in the green agenda, especially through Egypt’s Integrated Sustainable Energy Strategy to 2035 and innovative financing solutions such as the issuance of the first green bond in Africa and the Middle East.
The bank noted that Egypt was one of the few EBRD member countries to witness positive growth amid the first wave of the pandemic, as the country’s economy continued to grow at a rate of 3.6 percent during FY2019/20.
The bank also said that Egypt’s structural reforms were successfully implemented across key sectors, including education, social safety nets, and subsidies.
However, Egypt is still facing substantial transition gaps, according to the draft.
The significant role of the state in the economy, primarily through SOEs, at times constrains competitive forces and does not provide a level playing field for the private sector. Removing trade barriers could additionally strengthen competition from abroad.
“Economic governance requires further significant improvements, as public utilities and some SOEs continue to be hindered by limited financial sustainability and operational inefficiencies.”
Meanwhile, the draft noted that despite the efforts to address inclusion gaps, challenges affecting access to finances and other economic opportunities still persist, particularly in regard to women, young people, and remote and/or less developed regions.
It also referred to Egypt’s growing population that is exerting pressure on the country’s resources and public services, including water, energy, and transportation, which are all already strained by global climate change.
Accelerating the adoption of green measures in these sectors as well as addressing water scarcity will also be essential for the country’s growth over the coming years.
As of May 2021, the EBRD’s investment portfolio in Egypt adds up to €4.2 million across 105 projects with operating assets worth €2.7 million, according to the draft.
As part of the recently concluded 2017-2021 country strategy, the EBRD signed eight credit lines for its partner financial institutions for a total of €917 million and invested €46.4 million into SME Equity Funds in Egypt — such as SPE Capital Fund, Lorax Capital Fund II, Badia Impact Squared — to ensure the availability of long-term financing for SMEs in the country, according to the draft.