{"id":626191,"date":"2024-06-26T00:00:00","date_gmt":"2024-06-26T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/egypt\/hardhats\/the-eu-is-putting-aside-egp-100-bn-to-invest-in-egypts-drinking-water-infrastructure-through-2030\/"},"modified":"2024-06-26T00:00:00","modified_gmt":"2024-06-26T00:00:00","slug":"the-eu-is-putting-aside-egp-100-bn-to-invest-in-egypts-drinking-water-infrastructure-through-2030","status":"publish","type":"hardhat","link":"https:\/\/enterpriseam.com\/egypt\/hardhats\/the-eu-is-putting-aside-egp-100-bn-to-invest-in-egypts-drinking-water-infrastructure-through-2030\/","title":{"rendered":"The EU is putting aside EGP 100 bn to invest in Egypt\u2019s drinking water infrastructure through 2030"},"content":{"rendered":"

EU to provide Egypt with EGP 100 bn in funding for our drinking water needs:<\/strong> The European Union is set to provide Egypt with some EGP 100 bn in funding until 2030 to finance Egypt\u2019s drinking water needs in Upper Egypt, as part of a joint strategic and comprehensive partnership. The projects include the installation of several sewage stations, water and sewage networks, and drinking water stations in Qena, Sohag, Assiut, and Minya, according to European banking officials.<\/p>\n

Remember:<\/strong> The EU signed a joint strategic and comprehensive partnership with Egypt in March<\/a> that is set to grant Egypt a nearly EUR 7.4 bn package of loans, grants, and investments through 2027. Water security was among other key areas that were expected to bring in up to EUR 5 bn of investment from Europe, along with green hydrogen, industrial, digitization, agricultural, and other projects \u2014 all guaranteed by the European Fund for Sustainable Development<\/a> and EU Economic Investment Plan<\/a>. <\/p>\n

Who\u2019s doing the funding: <\/strong>The donor list includes a set of European development entities and financing institutions, including the German Development Bank (KfW), the French Development Agency (AFD), the European Investment Bank (EIB), and the Swiss State Secretariat for Economic Affairs (SECO), as well as EU grants, Water and Utilities Sector Manager at the EU Delegation to Egypt Ayman Ayad said.<\/p>\n

This isn\u2019t the first time the EU has provided aid for Egypt\u2019s water security:<\/strong> The EU has been a long-term strategic partner in drinking water projects and has allocated around EUR 600 mn for Egypt\u2019s water security since 2006, Ayad said. Water security as a key priority in Egypt\u2019s partnership with the EU has only been solidified further with the Strategic Partnership Agreement signed last March, Ayad added.<\/p>\n

The plan for the projects: <\/strong>The EU will provide EUR 303 mn (EGP 15 bn) distributed among the four governorates for projects that include drinking water and sanitation projects, as well as funding for technical support for existing drinking water and sanitation companies in the governorates, Ayad said. The current goal, he adds, is to familiarize Egyptian contractors with the tender for implementing the projects alongside the Holding Company for Water and Waste Water (HCWW) and the Housing Ministry.<\/p>\n

The EU has been working on issuing unified procedures among European development<\/strong> banks for tendering their projects,<\/strong> which will increase the presence of Egyptian contractors in the new projects that they offer, especially considering the decline in local funding for infrastructure projects, Egyptian Federation for Construction and Building Contractors (EFCBC) head Mohamed Sami Saad told Enterprise. The EFCBC has collaborated with EU representatives in Egypt, the German Development Bank, and the HCWW to clarify all technical and contractual matters for Egyptian contracting companies, he said.<\/p>\n

Remember:<\/strong> Local contractors have previously been reluctant to submit bids for projects funded by international lenders like the World Bank, European Bank for Reconstruction and Development, and the African Development Bank because they adhere to international contract standards that aren\u2019t part of the country\u2019s regulatory framework, Saad previously told Enterprise<\/a>.<\/p>\n

The EU has also made amendments to some contracting regulations,<\/strong> including allowing companies to be paid in EUR and offering construction contractors security in the face of possible price changes and exchange rate fluctuations, Saad said. These changes have long been demanded by local contractors \u2014 and the fact that they\u2019re now being realized reinforces ties with international development and financing entities, he continued.<\/p>\n

The projects have been divided into two categories:<\/strong> Projects worth less than EUR 5 mn will be bound by Egyptian tender laws, while projects exceeding that amount will be tendered according to international regulations, Ayad said. This will help anticipate and eliminate potential challenges by establishing a legal, legislative, and contractual framework to avoid problems, he added. The KfW is working on issuing one unified tendering document compatible with the European side, as it is the primary tendering entity for new drinking water projects,<\/p>\n

There are also efforts to simplify procedures for drinking water and sanitation projects:<\/strong> While the majority of construction contractors in Egypt are classified as able to carry out drinking water and sanitation projects, only 400 firms actually implement them, Ayad said, chalking this up to a long list of requirements that discourage participation. Simplifying these procedures, he says, will allow for more future participation from local firms.<\/p>\n

The success of previous water-related projects in the Delta with the EU contributed to the<\/strong> launch of the new phase in Upper Egypt, <\/strong>Consulting Engineers Salzgitter Deputy Regional Director for the MENA region Maged Reda tells us, adding that the new procedural facilitations and standards will open the door for further participation from Egyptian contractors.<\/p>\n

Egyptian contractors can gain expertise and know-how from the projects:<\/strong> Egyptian contractors involved in the project will benefit from working with development partners directly instead of dealing with banks or larger firms that can carry out a project from start to finish, EFCBC member Hamdi Shehata said. This, he added, will grant contractors the chance to refine their skills by working at an international standard and seeing the requirements up close.<\/p>\n

What\u2019s next:<\/strong> This round of talks is but one of many that the EFCBC intends to hold with international development institutions, Saad tells us, with the EFCBC looking to engage in similar dialogues with the Islamic Development Bank, the Asian Investment Bank, and the African Development Bank to improve the participation of Egyptian contractors by acquainting them with the procedures and guidelines of international entities. <\/p>\n

\n

Your top infrastructure stories for the week:<\/strong><\/p>\n