Minister of Planning and International Cooperation Ashraf Al-Araby has signed a KWD 30m loan agreement(approximately $106m) with the Kuwait Fund for Arab Economic Development (KFAED) to help finance the upgrade of the Assiut power plant, an according to a Monday statement from the ministry.
The loan will be repaid over a period of 24 years and with a fixed interest rate of 2.5%, and includes a 6-year grace period. Around 56.8% of the loan is a grant, the ministerial statement said.
The agreement was signed between the Egyptian minister and KFAED Director Abd-Al-Wahab Al-Bader. Egyptian Electricity Holding Company Chairman Gaber Desouky, chairman of Upper East Electricity Production Company (UEEPC) Fathy Ibrahim, regional head for the Arab States Marwan Ghanem and the Kuwaiti Ambassador to Egypt Salem Ghassab Al-Zamanan were among the attendees.
The Assiut power station project has previously received financial support from the Arab Fund for Economic and Social Development (AFESD), which had contributed $200m. The interim Egyptian government signed the final agreement with the Arab Fund on 25 March.
The project’s foreign currency budget is around $597m, the Ministry of International Cooperation noted. In December, UEEPC and Banque Misr signed an EGP 285m loan agreement to fund renovations and replacements in the Assiut power station.
The upgrades in the station, which will operate using traditional fuel resources, will help increase its production to 650 MW.
Al-Bader stated that a team from KFAED will visit Egypt in April with intentions to fund another electricity project in western Cairo, the Kuwait News Agency (KUNA) reported.
The total value of the loans provided by the KFAED to Egypt has reached $2.5bn. The Kuwaiti fund has previously financed the reclamation of 400,000 acres of land in Sinai with a total value of KWD 45m and the steam electricity station in Sidi Kerir with KWD 38.8m.