|Approval Date||23 Oct 2002|
|Signature Date||27 Mar 2003|
|Sovereign / Non-Sovereign||Non Sovereign|
|DAC Sector Code||24030|
The present project concerns a Line of Credit (LOC) to the Export Development Bank of Egypt (EDBE). This line of credit to EDBE is for financing export-oriented projects in the sectors of industry, tourism and services in Egypt. It's initiated because poverty alleviation through employment generation requires considerable investment in productive sectors, particularly private-owned and export-oriented production. So, the LOC should finance sub-projects in the productive sectors and in some few service sub-sectors in Egypt. It should also support sub-projects that are private, export-oriented and produce goods for export. The sub-projects to be selected are foreign exchange earning and, in most cases, resource-based. The LOC should provide medium to long-term sub-loans to enterprises in sectors of (i) industry; (ii) tourism; and (iii) services that support exports. A selected sub-project must be financially viable with a financial rate of return that should exceed the opportunity cost of capital of the sub-loans plus a risk premium.
The line of credit aims to contribute to the achievement of the following sector goals: (i) developing the country’s export sector, (ii) enhancing private sector development by supporting the SMEs, (iii) reducing poverty by creating employment and increasing production in rural areas. Its objective is to provide financial resources to the EDBE for on-lending to private sub-borrowers to enable them invest in export-oriented projects in the country.
The beneficiaries of the line of credit should be registered companies that produce exportable goods. The selected sub-borrowers will use local raw materials; increase the use of existing capacity where the potential for expansion is considerable; produce exportable goods; generate foreign exchange earnings; create employment; increase local professionalism and skills; produce goods that have substantial value-added; comply with environmental standards; and provide substantial employment opportunities to women. The line of credit is aimed at SMEs, where total investment cost does not exceed UA 8.0 million (about US$ 10 million).
African Development Bank
|Last Update||11 Apr 2021|