The International Finance Corporation’s (IFC) Africa head Sérgio Pimenta’s trip to thecountry is making the headlines, with the private-sector focussed World Bank Group member helping launch the country’s first ever sustainability bond issuance, green financing for Orascom Development in El Gouna, and an on-lending package to CIB to fund local SMEs.

IFC SUPPORTS AAIB’s USD 500 MN SUSTAINABILITY BOND ISSUANCE-

IFC commits the lion’s share of USD 500 mn sustainability bond issuance: The Arab African International Bank (AAIB) has issued a USD 500 mn sustainability bond with the majority of funds covered by the International Finance Corporation, alongside the European Bank for Reconstruction and Development (EBRD) and the UK government’s British International Investment (BII), according to a statement (pdf). The bonds will work to increase “access to finance to businesses and projects that help reduce greenhouse gas emissions or otherwise protect the environment,” while also helping address Egypt’s growing “financing needs for MSMEs,” the statement read.

This is the first ever issuance of sustainability bonds in Egypt, and also holds the title for being the largest ever sustainability bond issuance by a private bank on the continent, according to the statement. The bonds will have a duration of five years, according to a project summary from the IFC.

The breakdown: The IFC subscribed to the bond with USD 300 mn, while the ERBD and BII each invested some USD 100 mn in the bond. Of the total amount, 75% of the bond’s proceeds will be allocated to green financing — with the statement namechecking industrial energy-efficiency, small-scale renewable energy projects, and green buildings — while the remaining 25% will go towards providing financial assistance to MSMEs and inclusive finance.

What they said: “As the largest investor in the country’s first sustainability bond issued by AAIB, we are empowering a greener, more climate-resilient future for Egypt and contributing to the country’s climate commitments,” said IFC Africa head Sérgio Pimenta.

IFC TO PROVIDE USD 155 MN IN GREEN FINANCING FOR ORASCOM DEVELOPMENT EGYPT-

El Gouna set for a sustainability boost, courtesy of the IFC: The International Finance Corporation (IFC) is set to provide Orascom Development Egypt (ODE) with a sustainability linked loan equivalent to some USD 155 mn to help the firm “improve energy and water efficiency and reduce greenhouse gas (GHG) emissions” across a number of its hotels in El Gouna, according to a joint statement (pdf). The loan will be split between two tranches of USD 96 mn and EUR 55 mn.

The funds will go a long way in reducing ODE’s energy consumption, with the loan set to help the firm reduce its energy consumption at its hotels by 50% from non-renewable energy sources, and will lessen water usage by at least 20% — which will be done using heat pumps, solar heaters, and by implementing water conservation measures, according to the statement.

It will also help support ODE’s growth opportunities in El Gouna, with the funds set to help fund renovations of its Mövenpick Resort and Spa El Gouna. The IFC will also help ODE’s Gouna hotels achieve EDGE certification — “an IFC innovation that scales up resource-efficient buildings.” Part of the funds will also go towards improving the company’s debt profile and refinancing existing debt.

A big step for tourism in El Gouna: The agreement represents a “new and sustainable path” for Egypt’s tourism sector, Planning and International Cooperation Minister Rania Al Mashat commented in a separate ministry statement. Al Mashat added that the agreement “reinforces (El Gouna’s) position as a global destination for sustainable tourism, not only within Egypt but across the region.”

IFC PROVIDES CIB WITH USD 150 MN IN FINANCING-

IFC grants CIB USD 150 mn in financing for SMEs: The IFC has inked an agreement with private sector lender CIB that will see it grant the bank some USD 150 mn in soft financing aimed at supporting CIB’s efforts to promote micro and small and medium-sized enterprises, including women-led MSMEs (WMSMEs), according to separate statements from the Planning and International Cooperation Ministry and IFC.

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