The European Investment Bank (EIB) granted two loans to the Arab Republic of Egypt today. The contracts were signed by Mr Hisham Ramez Abd El Hafez, Deputy Governor of the Central Bank of Egypt and Philippe de Fontaine Vive, Vice-President of the EIB in charge of the partnership with the Mediterranean region.
- A loan of EUR 50 million in support of a new wind farm in Gabal el Zait
- A loan of EUR 70 million to improve access to safe drinking water and sanitation for four million people in the Nile Delta
Both projects represent a new approach of integrated and enhanced cooperation as the EIB is joining forces with its partners KfW, AfD and the EC with the support of the Neighbourhood Investment Facility (NIF).
The Gabal el Zait wind farm
The first loan will part finance a new 200 MW onshore wind farm on the Red Sea coast, which is part of an ambitious national program in the same region to further expand power generation from renewable energy. Electricity demand has indeed been growing rapidly since the mid-1990s at an average rate of 7.5% per year, particularly for household purposes and is expected to keep growing at an ever faster pace.
Increasing the proportion of electricity produced from renewable energies is a goal for both Egypt and the EIB. The Egyptian Government has ratified the Kyoto Protocol and set the ambitious target of meeting 20% of electricity demand from renewable sources by the year 2020. As for the EIB, the EU’s bank, the promotion of renewable energy, energy efficiency and security of supply has become a priority. The EIB devoted EUR 10.2 billion to this end in 2008, both within and outside the European Union, of which EUR 2.2 billion for the development of renewable energy projects – a figure that has quadrupled in the past two years.
The water and wastewater services investment programme
This project comprises investments in water supply and wastewater infrastructure in four Governorates in the Nile Delta – Behira, Damietta, Gharbia and Sharkia. It is essentially a framework loan comprising about 100 sub-investments aimed at improving access to safe drinking water and sanitation for approximately four million people in the project area.
The investment is expected to have a direct positive impact on the environment through i) saving additional water resources, ii) reducing the uncontrolled discharge of inadequately and/or completely untreated wastewater from existing wastewater treatment plants and iii) improving health conditions in a substantial number of still unserved areas.
Additionally a technical assistance component to identify the network’s deficiencies and help implement the investment programme will be provided.
FEMIP, the Facility for Euro-Mediterranean Investment and Partnership, is the European Investment Bank’s financial arm for the Mediterranean region. Its remit is to promote the development of nine countries: Algeria, Egypt, Israel, Jordan, Lebanon, Morocco, Syria, Tunisia and Gaza/West Bank. Its two investment priorities are: support for the private sector, the driving force behind sustainable growth, and the creation of an investment-friendly environment by means of efficient infrastructure and appropriate banking systems. FEMIP has established itself as the main financial partner of the Mediterranean region, with more than EUR 8.5 billion invested since 2002. It also encourages dialogue between the two shores of the Mediterranean, at the institutional level but also with the representatives of the private sector and civil society.