El Sewedy copper unit lands EBRD loan: Elsewedy Electric subsidiary United Metals Company (UMC) will receive a USD 50 mn loan from the European Bank for Reconstruction and Development (EBRD) to finance its working capital, according to the lender’s website. The exact terms of the loan were not reported.

It’s all about FX: The loan will help UMC’s hard-currency working capital needs, supporting its ability to import important raw materials like copper cathodes, amid the FX crunch and inflating global commodities prices, the ERBD said. Many local manufacturers have struggled with soaring inflation, a weaker EGP and a prolonged shortage of foreign currency squeezing margins and curbing access to key production inputs.

The UMC and EBRD go way back: The EBRD has supported the copper rod maker’s working capital needs several times in the past few years, having loaned out USD 25 mn facilities in 2017, 2019, and most recently in 2021.

International development banks have become an important source of FX for local companies: The International Finance Corporation (IFC) lent local steel maker Kandil Steel USD 25 mn in September, to fund its working capital drained by rising raw material costs and reduced access to USD. Local pipes producer Egyptian German Industrial Corporation (EGIC) is also awaiting approval on a potential USD 50 mn EBRD facility for its operations and the Export Development Bank (EBank) is getting a USD 25 mn loan from the EBRD to provide FX liquidity to importers.

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