The African Export-Import Bank (Afreximbank) has granted a $300m financing facility to the National Bank of Egypt (NBE) to support Egypt’s industrialisation efforts.
President of Afreximbank Benedict Oramah and chairperson of NBE Hisham Okasha signed the Industrialisation Support Facility agreement on 27 April on behalf of their respective institutions during a ceremony held at NBE’s office in Cairo.
Oramah said that the facility would support Egypt’s Small and Medium Enterprises (SMEs) Initiative, launched in 2016 to provide EGP 5bn in loans to medium-sized companies in the industrial and agricultural sectors, which constitute the main tradable sectors of the economy.
Oramah added that the facility will contribute significantly to the Egyptian economy.
“We will be empowering SMEs in the industrial and agricultural sectors to realise their business ambitions. As SMEs are major employers of labour in any economy, we expect this facility to boost employment and overall welfare of the Egyptian people,” noted Oramah. “Being a hard currency facility, it would make it possible for beneficiaries to access essential investment goods from the international market to improve their competitiveness.”
He added that the granting of the facility demonstrated Afreximbank’s commitment to the Egyptian economy and reflected the confidence of the Egyptian authorities in the bank as a key financing partner.
He announced that, since inception in 1993, Afreximbank had approved credit facilities totalling $13.8bn to Egyptian entities, representing 33.7% of the total facilities approved by the bank. Over the same period, the bank confirmed and issued guarantees and letters of credit exceeding $2 billion on behalf of Egyptian entities.
Afreximbank currently had an outstanding credit portfolio of about $4.2bn for Egypt, according to Oramah.
From his part, Okasha said that the facility would have a very significant impact on the Egyptian economy through the boost it would give to SMEs.
Okasha added that the NBE had a lot of experience in disbursing financing to SMEs, which would ensure the facility is properly utilised. He assured that the bank looks forward to further collaboration with Afreximbank.