CAIRO – 24 October 2019: European Bank for Reconstruction and Development (EBRD) revised the provision of two senior loans to the National Bank of Egypt (NBE) with a total amount of $50 million.
EBRD clarified that it revised the provision of a senior loan to NBE of up to $20 million on-lending to local, private, high-growth Small and Medium Enterprises (SMEs), which commit to strengthening their capacity to train and retain skilled labor, in particular of youth.
The project will address labor force skills mismatch, which constrains businesses in their growth, and create better and more sustainable jobs, including jobs for young people, according to the bank.
“This will be achieved by incentivizing enterprises to increase their capacity to effectively recruit, train and retain skilled labor,” the bank explained, expecting it to ultimately improve young people's employability and ensure a supply of skilled workers for businesses, essential to support expansion plans.
The bank added that this project would contribute towards building a more inclusive job market by expanding access to skills and employment opportunities, including for young people, who are faced with reduced access to such economic opportunities. “The project will also contribute towards a more competitive private sector through developing the capacity of clients to better recruit, train and retain skilled workforce.”
Meanwhile, the second loan is a senior unsecured loan to NBE worth $30 million to be provided by the EBRD to the program, Egypt Youth in Business (EgyptYiB). “The proceeds of the loan will be on-lent to local private enterprises that are led or owned by youth,” EBRD noted.
The bank expected the project to increase the pool of financing available to young individuals in Egypt and to help this group of borrowers to build their skill-set and develop their businesses, thereby promoting youth entrepreneurship and youth's participation in business through an integrated approach.
Earlier, Head of SMEs sector at NBE Saad Mohy el-Din said that the bank’s credit portfolio for small projects reached LE 64 billion in 2019. He added that the bank is working to reach LE 100 billion by the end of 2020 to finance and prepare feasibility studies and technical studies for the sector of small and medium enterprises.
NBE allocates 27 percent of the market share in terms of credit and deposit portfolios and ATMs network.