The World Bank’s board of executive directors agreed on 1 April to loan Egypt $300m to help finance micro and small enterprises (MSEs), according to a statement from the organisation.
The World Bank’s loan, called the Promoting Innovation for Inclusive Financial Access Project, aims to reach more than 130,000 micro and small enterprises, 37% of which are owned by women.
In collaboration with the World Bank’s private sector arm, the International Finance Corporation (IFC), the project aims to reduce poverty and promote economic prosperity.
The project, focused on low-income communities, seeks to “unlock the market for lending micro and small enterprises”, the organisation said.
“The project will unleash opportunities and provide income-generating activities to youth, women and entrepreneurs in marginalised areas,” said Sahar Nasr, a lead economist at World Bank and project team leader.
At this “critical” transition period in Egypt, the project will contribute to improving people’s lives through providing economic opportunities, Nasr said.
Meanwhile, the World Bank’s country director for Egypt said in the statement that the project will enhance “sustainable and inclusive access to finance and foster innovation”.
MSEs in Egypt, which make up 98% of enterprises, create 85% of employment opportunities in non-agriculture private sectors and 40% of total employment, the World Bank stated.
Through this project, the World Bank hopes to help Egypt’s economy grow and create job opportunities in the private sector, the statement said.
In March, the World Bank provided $200m to finance the Egypt Emergency Labour Intensive Investment Project, which aims to employ unskilled Egyptians.
In collaboration with the Egyptian government, the World Bank launched on 5 March a new partnership strategy for the next five years with the aim of supporting Egypt’s development priorities.
The World Bank portfolio in Egypt includes 24 projects, with a total commitment of $4.6bn, and 43 trust fund grants for a total commitment of $190.2m.
During 2013, IFC provided $276m to fund five initiatives in Egypt. The corporation is backing 14 projects around the country in manufacturing, construction, and the energy sector.