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We are happy to kick-off a new project, co-financed by KfW and the EU, supporting micro, small and medium enterprises (MSMEs) in Egypt in accessing needed financing to improve their operations and increase their competitiveness. This comes at a critical time where MSMEs in Egypt are facing increased macroeconomic challenges including a double-digit inflation, high interest rates, and a sharp currency devaluation.
This technical assistance (TA) builds upon our previous TA assignment carried out during the Phase A of the project between 2022 and 2023. During that period, we supported the Micro Small and Medium Enterprise Development Agency (MSMEDA) in administering a USD 30 million loan provided by KfW to on-lend to partner financial institutions, enabling them to expand their credit portfolio for micro and small enterprises in Egypt.
As part of the TA of the project’s Phase B, we will continue supporting MSMEDA in the general administration and disbursement of the credit line as well as providing advisory services to refine its MSME strategy, and help develop a national framework for entrepreneurship with a focus on stimulating the innovation ecosystem.
Further activities planned include:
- A job assessment study to assess the effect of MSMEDA’s investments in job creation in Egypt
- Support MSMEDA to upgrade its Environmental and Social Management System
- Development of an online platform for MSMEs offering various services in a digital way
- Develop an incentive scheme for start-ups and innovative SMEs
- Provide capacity building and investment grants to MSMEDA’s staff as well as microfinance institutions and NGOs countrywide, so they can address the growing demand for micro credit
After the kick-off meeting, held early March at MSMEDA headquarters, GOPA AFC Managing Director, Holger Christ, commented: “We are very happy to continue our collaboration with MSMEDA to support MSMEs access finance in Egypt. The new KfW and EU grant that MSMEDA received is of substantial amount. Currently, MSMEDA is working on a major transformation plan to enable it to play a key role to catalyze the MSME sector in Egypt and make it a major contributor to the economic growth of the country. This grant will be instrumental to help them in implementing their new vision”.
Dr. Mohamed Nasr, the GOPA AFC project team leader, added a few more remarks: “I am very happy to be leading this new TA project. During the first phase, we identified various capacity building needs for MSMEDA and we were very satisfied with the results we achieved in a very short period. Thanks to MSMEDA’s management and staff commitment, we were able to initiate various reforms which we will build on in this subsequent phase”.
The project is expected to support at least 10,000 micro and small enterprises in accessing loans and at least 900 new jobs to be created within these enterprises. Moreover, at least 350 innovative companies and start-ups will be supported through financial and non-financial support.
We look forward to working with the various stakeholders to gather momentum around economic reforms to support a just transition and increase the financial inclusion of vulnerable groups in Egypt.
For more information, contact Celine.Serhal [at] gopa-afc.de.