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Cairo, Egypt July 14, 2020 —IFC , a member of the World Bank Group, is joining forces with the National Bank of Egypt and the Micro, Small and Medium Enterprise Development Agency (MSMEDA) to strengthen the clean technology entrepreneurship sector and boost Egyptian farmers’ access to finance for solar irrigation.
Start-ups make up the bulk of players in the photovoltaic (PV) solar water pumping market in Egypt but are currently unable to scale up because of a lack of payment and finance options for customers, and a limited understanding of the sector. IFC’s specialized team will deliver technical assistance to four financial institutions, including the National Bank of Egypt, and MSMEDA to help develop a financial product for farmers to be able to afford purchase the pumps and assist with its piloting and roll out.
Around 960,000 diesel-powered water pumps are currently used for irrigation across Egypt, at a cost of about $250 million annually for the diesel. Replacing the pumps with PV systems would save farmers money in fuel and maintenance and help create a cleaner environment.
“Through our partnership with IFC, MSMEDA will deepen its understanding of solar irrigation systems and develop a financial product for farmers to purchase solar irrigation pumps. Not only can farmers use a clean and free source of energy, but they can also irrigate more land and increase their production. This initiative comes in consistency and in full alignment with MSMEDA strategy in exploring new feasible financial products that are environmentally friendly and using clean technology,” said Nevine Gamea, Minister of Trade and Industry, and Executive President of MSMEDA.
“The National Bank of Egypt will work hand in hand with IFC to develop financial products for farmers so they can purchase solar-powered water pumps,” said Mr. Yehia Abou El Fotouh, Deputy Chairman of the National Bank of Egypt, adding that lack of knowledge about the investment needed for solar products often makes banks shy away from financing such projects.
“Egypt’s start-ups have identified major untapped potential for the use of solar amongst farmers,” said IFC’s Country Manager for Egypt, Walid Labadi. “Our aim is to unlock this potential by supporting entrepreneurs and financial institutions in developing innovative business models that will boost the adoption of clean technology in the country.”
The project is being implemented in partnership with the governments of Denmark, Korea and Netherlands.
About IFC
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work in more than 100 countries, using our capital, expertise, and influence to create markets and opportunities in developing countries. In fiscal year 2019, we invested more than $19 billion in private companies and financial institutions in developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org .
About MSMEDA
MSMEDA is a semi-governmental organization that was established in April 2017 by the Decree n°947 of the Prime Minister, as a successor entity to the Social Fund for Development (SFD, which had been in existence since 1991). With the decree n°2370 of the year 2018 an amendment decision was made by the prime minister to establish MSMEDA with a direct supervision from the Prime Minister. MSMEDA is the designated public entity responsible for developing the MSMEs sector directly or through coordination of the efforts of the different stakeholders. Its mandate covers a wide scope to achieve this goal, including policy and strategy development, legislative and regulatory overview, monitoring and evaluation of sector performance as well as development, implementation and coordination of programs aiming at improving MSMEs, including direct & in-direct provision of financial and non-financial services. This new entity has an expanded range of competences compared to the SFD. MSMEDA’s headquarters is located in Cairo, with a national-wide presence (local branches in every governorate).
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