(Ecofin Agency) - Egypt is pursuing, since 2019, a policy aimed at strengthening its private sector. The policy translates into the privatization of state firms and increased financing to private actors.
The Egyptian government and the European Bank for Reconstruction and Development (EBRD) have launched a new US$175 million private sector development program to promote the green economy. The information was disclosed by the Egyptian Ministry of International Cooperation last Tuesday, January 31.
Specifically, the funding will finance the second phase of the Green Economy Financing Facility Egypt (GEFF Egypt), which targets MSMEs. The second phase aims to enhance MSMEs' participation in the country's development, create more employment opportunities, and improve the sustainability and resilience of value chains. According to Minister of International Cooperation Dr. Rania A. Al-Mashat, the initiative will also improve the competitiveness of the private sector, increase investments in MSMEs, and provide technical support to support overall growth and sustainability.
"In addition to technical support and technical advisory efforts, vigorous work is being done to increase partnerships to advance private sector participation in development and place it at the heart of all future strategies with multilateral and bilateral development partners," a press release informs quoting the Minister. The second phase of the project will stimulate the growth of the private sector but also support its ability to effectively contribute to sustainable development and the transition to a green economy. During the first phase, the concessional financing of US$157 million supported more than 101 projects.
In 2019, Egypt unveiled a plan to privatize dozens of state companies and boost the private sector's contribution to the economy to 65% by 2025, against 30% in 2021. Due to the coronavirus pandemic, its implementation was suspended in 2020, but relaunched in 2022.