RIYADH: Egypt has signed a $1 billion financing agreement with the World Bank, aimed at strengthening economic competitiveness, improving the business environment and supporting the country’s green transition.
The agreement forms part of the North African country’s broader efforts to mobilize development financing from international and regional institutions and strengthen the economy’s ability to withstand external shocks, according to a statement from the Ministry of Foreign Affairs.
The World Bank has also flagged risks to the country’s outlook from the conflict in the Middle East.
New financing aligns with broader partnership framework
The funding is aligned with the World Bank Group’s 2023–2027 Country Partnership Framework for Egypt, which outlined a $7 billion financial envelope over five years.
This comprises $5 billion in financing from the International Bank for Reconstruction and Development and about $2 billion from the International Finance Corporation, alongside guarantees from the Multilateral Investment Guarantee Agency.
Reforms target social, green development, and more
The newly released ministry statement said: “The agreement supports the state’s efforts to achieve green development, and create an investment environment conducive to creating job opportunities and improving the standard of living of citizens.”
The deal comes as Egypt seeks to attract more private investment, improve its business environment and sustain economic growth amid regional instability and pressure on external financing.
The World Bank approved the $1 billion financing in May as the second operation in a series of three development policy financing packages designed to support structural reforms and strengthen the country’s economic resilience.
The second phase includes a package of social, economic and environmental reforms designed to support sustainable growth, improve investment conditions and create job opportunities.
Among the measures is expanding the beneficiary base of the country’s Takaful and Karama social protection programs, which provide support to low-income households.
The program also includes reforms to improve the monitoring of greenhouse gas emissions and develop carbon credit markets, supporting Egypt’s efforts to advance its green transition.
Other measures seek to improve the financial sustainability of the electricity and water sectors, while strengthening the country’s ability to address the effects of climate change.
Egypt’s economy expanded 5.1 percent in fiscal year 2025/26, according to the World Bank’s October 2026 Macro Poverty Outlook. The lender has also highlighted risks to the country’s economic outlook from the conflict in the Middle East.