$360M loan aims to enhance Egypt's macro fiscal sustainability

The World Bank’s Board of Executive directors issued a statement Thursday, approving a US$360 million Development Policy Financing (DPF) loan program to support Egypt’s post-pandemic recovery and enhance the country’s prospects for sustainable and inclusive growth.

et interviewed the loan program leaders: Mark Eugene Ahern, WB’s Lead Country Economist and Mohamed Hisham El-Shiaty, Senior Private Sector Specialist, to discuss Egypt’s growth during the pandemic crisis, and specifics of the fund program.

The program focuses on three thematic pillars, including: enhancing macro-fiscal sustainability, enabling private sector development, and fostering women’s economic inclusion.

Below is the interview:

et: What is the duration of the program?

Egypt Inclusive Growth for Sustainable Recovery program duration is around 17 months, with the closing date planned for March 31st, 2023.

et: Was the financing program ($360 million) requested by the Egyptian government or proposed by the World Bank?

As with other World Bank engagements, the request for this Development Policy Financing (DPF) was made by the Government of Egypt to the World Bank. Meanwhile, the exact size of the loan was agreed based on a number of criteria including the total envelope allocated for Egypt for this fiscal year and its distribution across the different priority engagements for the Government.

In addition, the Asian Infrastructure Investment Bank (AIIB) is considering to extend the same amount of financing to the Government of Egypt in parallel to the World Bank financing using the same agreed package of reforms. If approved, this would bring the total financing provided under this program by both institutions to US$ 720 million.