Cairo – MENA Herald: IFC, a member of the World Bank Group, and development partner Eximbank are continuing to provide innovative financial products for Egyptian farmers, and help smaller businesses in Egypt as well as North African and Levant countries adopt sustainable energy technologies to drive economic growth and development.
Micro, small and medium enterprises (MSMEs) in Egypt, including farmers active in agricultural-based value chains, face a host of challenges, from difficulties in accessing finance to high energy costs. IFC aims to support private sector development by addressing these challenges, through its collaboration with partners like Hungary’s Eximbank.
Eximbank has supported IFC’s advisory programs with a total of $1.5 million over the past two years, including $1 million to help IFC pilot an Islamic microfinance program in Egypt and Tunisia, potentially one of the first scalable models for musharaka (e.g. profit- and risk-sharing) in MENA and globally. In Egypt, the program enabled the Alexandria Businessmen’s Association (ABA) to design and pilot a cost-effective, profitable risk-sharing product, targeting farmers in the dairy sector. The new financing mechanism provides an alternative to conventional microfinance, with many of the heifers purchased for the pilot scheme sourced from Hungary. Eximbank also recently provided $500,000 to promote sustainable energy financing in North Africa and Levant countries, part of a $3.5 million program in the region that IFC started in 2010.
“Our partnership with Exim Bank has made these efforts possible” said Xavier Reille, Manager of IFC Financial Sector Advisory Services – Financial Institutions Group. “Helping financial intermediaries provide new and innovative financial products will facilitate access to finance, a strategic priority for IFC across the region.”
IFC and Eximbank’s partnership began in 2014, aiming to help Hungarian companies enter new foreign markets by participating in World Bank and IFC development tenders. Eximbank focuses on the agriculture, water management, ICT, energy and healthcare sectors in Egypt, North Africa, the Western Balkans, Central Asia, former CIS countries, India, Turkey, Indonesia, and Vietnam, in particular. Eximbank’s strategy in Egypt is aligned with the foreign economic strategy of the Hungarian Government, and build on projects in the pharma industry, transportation, ICT sector.