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Al-Ahram Weekly 29 Apr. - 5 May 1999 Issue No. 427 
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Published in Cairo by AL-AHRAM established in 1875 |
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Al-Ahram Weekly 29 Apr. - 5 May 1999 Issue No. 427
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| Published in Cairo by AL-AHRAM established in 1875 |
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Egypt Region International Economy Opinion Culture Profile Focus Special Travel Sports People Features Living Time Out Chronicles Cartoons Letters 'Ready to be financed'
by Niveen WahishA senior official from the European Investment Bank (EIB) last week announced that the absorptive capacity of the Egyptian economy for EIB's financing has increased sharply. The EIB is the European Union's institution for long-term financing and plays a major role in the EU's technical and development policy for countries in the Mediterranean region. In Egypt, the bank has placed particular emphasis on aiding development in the industrial, energy, environment and water sectors.
"A few years ago we could not identify projects [in Egypt] that were ready to be financed," said Ariane Obolensky, vice-president of EIB, during a press briefing in Cairo. "EIB's activities in Egypt have sharply accelerated during the past four years and have also diversified in various sectors," she said, adding that she is "confident that in the future, the number of Egyptian projects in the pipeline will be very satisfactory."
Speaking about the changing nature of Egyptian projects, she said, "There are new needs in public infrastructure that are now taken into account." She explained that there is more awareness of water and environmental issues. There is significant private sector growth as well, she added. An increasing amount of the bank's loans are now going to finance industrial projects set up by the private sector. "This was totally out of the question some years ago."
Obolensky was in Egypt not only to visit projects financed by the bank but mainly to sign two loan agreements worth some 35 million euros (about LE94.5 million). Of this sum, 30 million euros (around LE81 million) will go to the Ministry of Housing for the design and construction of a wastewater collection system and a biological wastewater treatment plant in western Alexandria to be completed by 2003. The new project aims to upgrade and extend water and sewage services to 750,000 individuals.
The remaining five million euros (LE13.5 million) will be loaned to Messer Gas Dikheila (MGDK), west of Alexandria, a joint venture between Egyptian and European partners, for the construction of a new air separation plant which will produce industrial gases. Upon completion next year, MGDK will produce oxygen, nitrogen and argon, which are principally used in the steel industry. The Alexandria Iron and Steel Co. (ANSDK) will be a major buyer of MGDK's products.
The financing of the two projects is part of more than 800 million euros (around LE2.1 billion) committed to Egypt in the last four years, of which 600 million euros (about LE1.6 billion) have already been disbursed. The amount coming to Egypt is part of more than ECU 2.3 billion for the period of 1997-2000 for investment projects in 12 non-member countries in the Mediterranean region which have cooperation agreements with the EU. (The appropriation was made in the old European Currency Unit -- ECU -- before the euro came into existence.) "Egypt is among the countries that have benefited in absolute terms from that policy," Obolensky said.
During her stay, the EIB vice-president discussed with Egyptian authorities the framework for future cooperation. And although no specific figures have yet been set for EIB funding for the coming five-year period, Obolensky said that the money is expected to go to the same sectors, adding that the bank will try to increase its work with the private sector.
"I am impressed by the demand from European firms of different sizes and sectors to get involved in partnerships with Egypt. Egypt is of a size and capacity to attract foreign projects," she said, indicating that government policies are very encouraging. She added that Egyptian businessmen also seem to know how to create really interesting business opportunities.
