Financing Agreement Worth EUR 290 Million Signed with EBRD to procure 100 Locomotives
Financing Agreement Worth EUR 290 Million Signed with EBRD to procure 100 Locomotives
Source : Egyptian Ministry of Investment and International Cooperation
19-Jun-2017
the Minister of Investment and International Cooperation Dr. Sahar Nasr and EBRD’s Managing Director for the Southern and Eastern Mediterranean (SEMED) region and Country Head for Egypt Ms. Janet Heckman signed a financing agreement worth EUR 290 million to procure 100 locomotives, in favor of the Egyptian National railways (ENR), in presence of the Minister of Transport Dr. Hesham Arafat. Dr. Nasr and Dr. Arafat also witnessed the signing of the project’s executive framework between Ms. Heckman and Head of the ENR Mr. Medhat Shosha.
Dr. Nasr stated that MIIC was keen on taking prompt actions to support the Ministry of Transport’s strategy to develop connection networks, which would contribute to achieving development. She noted that the purpose of the project was to improve standards of living, facilitate population movements and renovate ENR’s locomotives. It is worth noting that the project came few days after the signing of an agreement with General Electric (GE) to procure 100 locomotives for both freight and passengers. The Minister explained that the project was highly significant since it reflected cooperation between partners, the government, EBRD and the private sector, noting that the project was an example of the successful partnership targeted by MIIC.
According to the Minister, Egypt had strategic relations with EBRD and was considered the second largest beneficiary from it. Within the framework of Egypt’s adoption of a comprehensive economic and social reform program, indicated the Minister, EBRD approved Egypt’s transformation into a fully-fledged country of operations in October 2015 and the first cooperation strategy with Egypt was designed in December of the same year for four years.
The cooperation strategy with EBRD reached up to EUR 2.7 billion to implement 47 projects and included sectors of priority to citizens such as electricity and sanitation, which contribute to improving standards of living, mentioned Dr. Nasr, who emphasized her keenness on delivering services to governorates and disadvantages villages.
The Minister emphasized that investing in citizens would be stepped up during the upcoming period, noting that the project included a large local component, which ensures the project’s sustainability and maintenance. The upcoming period would also witness the development of clear programs to support the transportation sector, invest in citizens and provide training to workers, added the Minister, who pointed out that EBRD provided a grant worth EUR 1.5 million to support the project signed that day.
In response to journalists’ inquiries, the Minister explained that investors were offered three alternatives for incorporation procedures, namely either through the Investors Service Center where there are representatives from various agencies, or through seeking such agencies themselves, or through offices accredited by GAFI.
As mentioned by the Minister, negotiations were underway with the US and France on debt swap, which contributes to transforming debts into development projects. She stated that the Sinai Development Project was moving ahead and that all Arab funds supported the project, indicating that actions were taken to support women and youth in North Sinai.
On his part, Dr. Arafat declared that the agreement came within the framework of the Ministry’s plan to develop Egypt’s railways. He further explained that ENR was in need of such locomotives to support the passenger transport sector, which would, in turn, contribute to increasing the number of trips and improving relevant services. He added that ENR was about to apply an ambitious plan for developing its locomotives with a view to keep pace with the increasing demand for the sector’s provided services.
In addition, Dr. Arafat clarified that the locomotives would be used for the movement of passengers, noting that the Ministry worked on renovating passenger locomotives. He also expressed his appreciation of the Minister for her support of the transportation sector and for securing funding and grants for developing the railways.
Ms. Heckman, on the other hand, said that the transportation sector in Egypt was considered one of the largest beneficiaries from EBRD with approximately EUR 450 million in order to implement projects that would provide better transportation services to citizens. Among these projects was the one signed that day, which included the provision of 100 diesel locomotives and their maintenance contracts, added Ms. Heckman, who noted that the project would serve about 10 million citizens.
“We are proud to contribute to developing such a significant sector in Egypt. This is considered a key step towards supporting and reforming the transportation sector in line with EBRD’s approach to provide adequate railways services so as to improve people’s lives and, accordingly, the economy as a whole,” indicated Ms. Heckman.
Moreover, Mr. Shosha expressed his appreciation of Dr. Nasr for her role in supporting the transportation sector, while noting that the sector was working on the development of railways.