As part of its mission to address the deep-seated issues needed for achieving the World Bank’s twin goals of eliminating poverty and promoting shared prosperity, the Egyptian government is implementing bold reforms to help to stabilize its economy. Over the weekend, Egypt and the World Bank signed an agreement to support the country’s next generation of reforms with the “Catalyzing Entrepreneurship for Job Creation” project.
The $200 million project is focused on job creation and entrepreneurship particularly for women and young people combined with expanding access to finance for SMEs, which have proven to be a major source of growth and job creation. The agreement happened in Aswan, Egypt with David Malpass, the new President of the World Bank; Dr. Sahar Nasr, Minister of Investment and International Cooperation and Egypt’s representative on the Bank’s Board of Governors; and Marina Wes, World Bank Country Director for Egypt, Yemen and Djibouti, in attendance as signatories to the agreement.
“Entrepreneurs – especially women – are a cornerstone for strong and stable economies,’’ said Dr. Nasr. “Our partnership with the World Bank Group aims to empower Egyptian women and youth to become successful entrepreneurs. This is an investment that offers many opportunities to improve the livelihoods of Egyptians through job creation while contributing to a solid foundation for the country’s economy.’’
The new project is created to tackle major obstacles that women and youth face when setting up new businesses. Since Egypt’s economy is dominated by banks that mostly only offer loans to established businesses, this project will channel $145 million through non-bank financial institutions to give loans to SMEs run by women and youth in less developed regions across Egypt.
The project will also invest $50 million in privately managed risk capital intermediaries to build up the early-stage investment ecosystem in Egypt, while funding coaching opportunities for new businesses throughout the entrepreneurial lifecycle to build the necessary skills and capacity for success.
According to Mr. Malpass, Egypt’s strong commitment to reform is beginning to show positive results, but more efforts are needed for the benefits to reach all segments of society. “With this new financing, we are keen to support Egypt’s second wave of reforms, which has at its heart the creation of new opportunities for young people and women, along with further progress toward sustainable and inclusive growth,” he said.
The World Bank supports several projects in Egypt focused on expanding social protection and social inclusion to all citizens some of which includes the education reform project, the project on transforming Egypt’s healthcare system, the private sector development for inclusive growth, and the sustainable rural sanitation services program. The World Bank has a portfolio of 16 projects in Egypt with a total commitment of $6.69 billion.