Cairo, December 3, 2006
– The International Finance Corporation, the private sector arm of the World Bank Group, today signed its first public-private partnership advisory agreements with the government of Egypt to support three infrastructure projects. The New Cairo Potable Water and Wastewater projects will provide safe water and sanitation to the growing population of New Cairo and outlying areas, while the New School project will help the government meet the country’s growing demand for schools.
Water and sanitation services are poor and require new investment both in Cairo and the rest of the country. According to this year’s Global Human Development Report on Water published by the United Nations Development Program, progress in water and sanitation requires innovative strategies for long-term financing. Investment in water and sanitation is vitally important for New Cairo, which is being developed to ease overcrowding in the capital and is projected to grow from the current 350,000 residents to 2 million by 2020. The project will also provide a model for other projects in the water sector.
The schools project addresses the country’s shortage of schools. The government estimates that more new primary and secondary schools are needed to meet continuing population growth and current shortages in facilities. While IFC will help the government implement the New Schools Public-Private Partnership project, to include the building and management of 300 new school facilities, the government will maintain responsibility for teaching and other core public services. The aim of the project is to enhance cost-effectiveness and quality of school infrastructure and maintenance.
“Public-private partnerships are a business model that helps increase private sector investment in public infrastructure to meet the needs of a growing economy and improve services, especially for people who need them most,” said Lars Thunell, IFC’s Executive Vice President.
The government has appointed IFC as its transaction advisor to assist in implementation of its public-private partnership pilots and to help attract private investment for the financing, design and construction, and operation of these pioneering projects.
“As a private sector development institution and a member of the World Bank Group, IFC has a unique capacity to structure private participation in infrastructure projects in a way that balances commercial viability with the public good,” said Thunell.
Thunell signed the advisory agreement during his first visit to Egypt and the region since joining IFC in January 2006.
The visit highlights IFC’s continuing commitment to its well-established partnership with Egypt as well as to private sector development, poverty reduction, and employment creation throughout the Middle East and North Africa. In fiscal year 2006, IFC committed in Egypt $81 million to eight projects, up from $44 million in the previous fiscal year.
Thunell’s agenda included meetings with government officials as well as consultations with representatives from the local private sector and civil society. During his visit, he was accompanied by Michael Essex, IFC’s Director for the Middle East and North Africa region.
About IFC
The International Finance Corporation, the private sector arm of the World Bank Group, is the largest multilateral provider of financing for private enterprise in developing countries. IFC finances private sector investments, mobilizes capital in international financial markets, facilitates trade, helps clients improve social and environmental sustainability, and provides technical assistance and advice to businesses and governments. From its founding in 1956 through FY06, IFC has committed more than $56 billion of its own funds for private sector investments in the developing world and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. With the support of funding from donors, it has also provided more than $1 billion in technical assistance and advisory services. For more information, visit
www.ifc.org
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About PEP-MENA
IFC’s PEP-MENA is a multidonor facility for technical assistance that supports private sector development across the Middle East and North Africa region. The facility was launched in October 2004 as part of the G8 Broader Middle East initiative. PEP-MENA focuses on improving the business enabling environment, strengthening financial markets, supporting SME development, and promoting privatizations and public-private partnerships. From its inception through FY06, PEP-MENA has committed more than $20 million in technical assistance and advisory services projects. Its activities are funded jointly by IFC and the following donors: Canada, France, the Islamic Development Bank, Japan, Kuwait, the Netherlands, the United Kingdom, and the United States.
