Egypt and the European Union Launch the European Fund for Sustainable Development Plus (EFSD+) Mechanism for Investment Guarantees Worth €1.8 Billion

During the activities of the “Development Finance to Foster Private Sector-Led Growth & Jobs” Conference, under the patronage and presence of H.E. Dr. Mostafa Madbouly, Prime Minister of Egypt

 

Egypt and the European Union Launch the European Fund for Sustainable Development Plus (EFSD+) Mechanism for Investment Guarantees Worth €1.8 Billion

 

Dr. Rania Al-Mashat: The Investment Guarantee Mechanism reflects the shared commitment of the government and the EU to empower the private sector to lead development efforts.

The mechanism provides guarantees to development partners to enable them to increase concessional financing to local and foreign private sectors.

Director General for the Southern Neighbourhood at the European Commission: The investment guarantee mechanism is a strategic platform to accelerate investment in Egypt.

 

The Egyptian government and the European Union (EU) in Egypt launched the European Fund for Sustainable Development Plus (EFSD+) mechanism for investment guarantees worth €1.8 billion, which represents one of the provisions of the political declaration issued during the Egypt-EU Summit held in March 2024, chaired by H.E. President Abdel Fattah El-Sisi, President of the Arab Republic of Egypt, and Ms. Ursula von der Leyen, President of the European Commission.

 

This came during the activities of the “Development Finance to Foster Private Sector-Led Growth & Jobs” conference, organized by the Ministry today, under the patronage and presence of H.E. Dr. Mostafa Madbouly, Prime Minister of Egypt, Lieutenant General Eng. Kamel El-Wazir, Deputy Prime Minister for Industrial Development and Minister of Industry and Transport, Mr. Makhtar Diop, Managing Director of the International Finance Corporation (IFC), Mr. Mark Davis, Managing Director for the Southern and Eastern Mediterranean (SEMED) Region at the European Bank for Reconstruction and Development (EBRD), Ms. Gelsomina Vigliotti, Vice President of the European Investment Bank (EIB) for the Mashreq Region, Mr. Stefano Sannino Directorate General for the Middle East, North Africa and the Gulf at the European Commission, and distinguished representatives from the business community, the private sector, and development partners.

 

The EFSD+ platform is one of the main components of the European External Investment Plan, which aims to enhance sustainable investments in partner countries, including Egypt, by stimulating the role of the private sector and providing innovative financial tools. The platform enables the use of innovative financing instruments, such as guarantees, concessional loans, and blended finance to reduce investor risk and encourage participation in development projects in strategic sectors such as water, energy, agriculture, climate, infrastructure, and digitalization.

 

For her part, H.E. Dr. Rania Al-Mashat, Minister of Planning, Economic Development, and International Cooperation, explained that the investment guarantee mechanism reflects the joint commitment of the government and the European Union to support the private sector's participation in the development process,as part of a comprehensive strategy through which the EFSD+ seeks to attract public and private capital through risk-sharing instruments such as guarantees and blended finance.

 

H.E. added that the mechanisms to benefit from the investment guarantees are now available through the “Hafiz” platform for financial and technical support to the private sector:

https://privatesector.moic.gov.eg/ar/efsd,

which enables private sector companies to obtain access to financing on easy terms through partner banks and financial institutions, reduce investment risks through guarantees provided by the European Union, participate in infrastructure and green development projects supported by the EU, and receive technical support for project development, feasibility studies, and business model designs.

 

H.E. stated that the mechanism will provide guarantees to a wide range of international financial institutions, including: the European Investment Bank (EIB), European Bank for Reconstruction and Development (EBRD), German Development Bank (KfW), International Finance Corporation (IFC), Italian Deposit and Loan Fund (CDP),

and other institutions, encouraging them to increase concessional development financing for the private sector, thereby mobilizing more private capital for priority development sectors in Egypt, particularly renewable energy, green transition, food security, investment in human capital, infrastructure, and others.

 

For his part, Mr. Stefano Sannino, Directorate General for the Middle East, North Africa and the Gulf at the European Commission, explained that the European Union today launches the Investment Guarantee Mechanism for Development between the EU and Egypt, which is a strategic platform designed to accelerate investment projects and provide broad financing solutions in Egypt. Almost a year after the success of the EU-Egypt Investment Conference, which enabled numerous European investment opportunities in Egypt, this represents another major milestone in implementing the strategic partnership between the EU and Egypt, explaining that under the “Team Europe” approach, the European Union is becoming a strategic investor and economic partner in sustainable growth and the green transition in Egypt. The Investment Guarantee Mechanism for Development will help mobilize up to €5 billion in public and private investments between 2024 and 2027.

 

The Ministry of Planning, Economic Development, and International Cooperation, in its role as the national coordinator of economic relations with the European Union, is implementing this mechanism in full coordination with the European Commission and the EU Delegation in Egypt through the “Hafiz” platform for financial and technical support to the private sector.