Egyptian Prime Minister Mostafa Madbouly has directed the government to finalise a new Infrastructure Finance Guarantee Facility (IFGF) by the end of the year to enhance private sector participation and reduce pressure on the state budget.
The directive was issued during a meeting in the New Administrative Capital, where Madbouly reviewed the proposed mechanism alongside cabinet ministers and World Bank officials. The Prime Minister instructed the swift completion of procedures in coordination with the Central Bank of Egypt to begin funding projects this year, noting the facility is an innovative mechanism successfully applied in other countries to encourage public-private partnerships (PPP).
Minister of Planning and Economic Development Ahmed Rostom said the IFGF is a credit guarantee tool offered in partnership with the World Bank Group, including the International Bank for Reconstruction and Development (IBRD) and the International Finance Corporation (IFC), with potential participation from the African Development Bank (AfDB).
The facility aims to attract private capital to the renewable energy, water, transport, and housing sectors. Rostom noted it will support local currency financing, reduce foreign exchange risks, and allow the state to manage contingent liabilities more efficiently, aligning with the Egypt 2030 vision.
Pilot projects expected between 2028 and 2038 include PPPs, particularly in renewable energy, and private-to-private (P2P) projects in energy-intensive industries.
Deputy Prime Minister for Economic Affairs Hussein Issa stated the mechanism aligns with the state’s strategy to expand private sector involvement in infrastructure investment, noting the government is prioritising innovative tools to stimulate private funding while reducing state burdens and ensuring project sustainability.
Minister of Finance Ahmed Kouchouk added that the IFGF integrates with other innovative financing tools, such as guarantee ceilings, to maximise returns for the state and enhance cooperation with international development partners.
Addressing sector-specific hurdles, Minister of Electricity and Renewable Energy Mahmoud Esmat highlighted a recent meeting with World Bank officials regarding structural challenges in infrastructure financing, including long-term funding, high costs, and guarantee requirements. Esmat praised the ongoing cooperation to support Egypt’s electricity grid and develop renewable energy technologies.
Niraj Verma, Manager of International Finance and Investment Practices at the World Bank, said the proposed facility aligns with Egypt’s infrastructure needs and represents a significant step in bilateral cooperation. Verma shared the bank’s successful international experiences in applying similar mechanisms to support private sector engagement.
The meeting was also attended by Chairman of Ayady Company (affiliated with the National Investment Bank) Osama Saleh; Deputy Minister of Foreign Affairs, Emigration and Egyptian Expatriates Samar Al-Ahdal; Assistant Minister of Foreign Affairs for Multilateral and Regional Economic Affairs Tamer Mostafa; Central Bank Sub-Governors Ashraf Bahie El-Din and Rana Badawi; Assistant Minister of Housing, Utilities and Urban Communities Amr Khattab; and World Bank Senior Financial Sector Specialist Katiana Garcia-Kilroy.
