The International Islamic Trade Finance Corporation (ITFC) has approved a significant $1.5 billion financing facility aimed at strengthening Egypt’s energy and food security. The facility includes a $700 million allocation for the General Authority for Supply Commodities (GASC), which manages Egypt’s crucial bread subsidy program, and an $800 million loan for the Egyptian General Petroleum Corporation (EGPC).
This funding is part of a broader five-year framework agreement, valued at a total of $6 billion, designed to stimulate growth in key sectors such as energy, food security, and small and medium-sized enterprises (SMEs). The latest round of commitments will focus primarily on trade financing to support energy and food imports, as well as assist Egypt’s growing SME sector, according to the ITFC.
A Vital Support for Egypt’s Strategic Needs
Egypt has long depended on external imports to meet its domestic energy and food needs, with its bread subsidy scheme costing the government over $2.5 billion annually. The country, which is one of the largest wheat importers globally, serves a population of 70 million people relying on subsidized bread. Sherif Farouk, Egypt’s Minister of Supply and Internal Trade, emphasized the importance of this financing in fulfilling the state’s commitments to its citizens, noting that the collaboration with the ITFC has become an essential pillar in securing Egypt’s strategic requirements for basic goods.
“The financing of food imports will ensure the fulfillment of the state’s obligations towards its citizens. This partnership has proven invaluable in supporting Egypt’s efforts to ensure its food and energy security,” said Farouk.
Strengthening Energy Security Amid Challenges
Rania Al-Mashat, Egypt’s Minister of Planning, also highlighted the impact of this deal on the country’s energy sector. In a statement, Al-Mashat explained that the funding would enhance the availability of petroleum products and energy supplies, ensuring stability across Egypt’s critical sectors.
The Egyptian General Petroleum Corporation (EGPC) will use the $800 million loan to bolster the country’s petroleum supply, which has faced disruptions in recent years. This financing will allow for greater stability and energy access for Egyptian citizens and businesses, paving the way for sustainable growth in the economy.
A Long-standing Partnership with ITFC
The ITFC’s commitment to Egypt stretches back to 2008, with the multilateral trade finance institution having already invested more than $18.7 billion into the country’s economy. The latest financing package is expected to not only address Egypt’s immediate energy and food security needs but also promote export growth and job creation, particularly for young people and women. ITFC’s ongoing support aims to strengthen Egypt’s resilience, enhance its export capacity, and reduce reliance on imports.
Advancing Trade Integration and Development
Beyond trade financing, the deal marks a continued partnership between Egypt and the ITFC to advance regional trade integration. The two parties will collaborate on initiatives such as the Arab African Trade Bridges program and the second phase of the Aid for Trade Initiative for Arab Countries, which seek to boost trade flows within the Arab and African regions and enhance Egypt’s role as a key player in these markets.
