National Bank of Egypt launches Environmental Finance Initiative
The Environmental Finance Desk's first transaction is a facility of EGP140m to finance the conversion of brick-making plants in Arab Abu Saeid (located in Suff, Giza Governorate) from fuel oil and diesel and cleaner-burning natural gas.
In partnership with the Egyptian Environmental Affairs Agency and Town Gas Co., the Environmental Finance Initiative has extended financing to c.200 brick plans under funding earmarked as part of NBE's Project to Counter Industrial Pollution (Phase II).
"This project is a natural extension of NBE's role in helping address chronic national problems," said NBE Chairman Tarek Amer.
"The Bank's goal is to make a quantifiable difference in our nation's environment by switching industry from diesel and fuel oil to more efficient, cleaner-burning natural gas. We will also work with industry to identify other pro-environment financing opportunities with the goal of helping exporters do better by our local environment while simultaneously making their goods more competitive on the global market," Amer continued.
"The environmental benefits we will help finance will allow industry to produce greener products — a sought-after designation in global markets — and, in many cases, to become more cost-competitive as they do so."
On Monday, March 5th, NBE began providing the brick-makers in this first project with grants from its own resources amounting to 20% of total value of the project package. With a view to completely transitioning the industry to natural gas from oil-based fuels, the Bank is currently in talks with brick makers in Beheira governorate as well as the remaining factories in the Suff area that did not participate in this first project.
Project finance includes allocations for external works (EGP70m, including finance to build a pressure modulation station in the Suff area) as well as internal works at each plant, including kilns (accounting for the remaining EGP70m). The total cost of converting each plant to natural gas is EGP700,000.
NBE has other environmental finance facilities for industrial clients, including loans with subsidized interest rates of 2.5% for eco-friendly initiatives. Furthermore, NBE and DEG cooperate to donate 20-30% of the financing needed to projects intended to lower the environmental impact of industrial projects.
In partnership with the Egyptian Environmental Affairs Agency and Town Gas Co., the Environmental Finance Initiative has extended financing to c.200 brick plans under funding earmarked as part of NBE's Project to Counter Industrial Pollution (Phase II).
"This project is a natural extension of NBE's role in helping address chronic national problems," said NBE Chairman Tarek Amer.
"The Bank's goal is to make a quantifiable difference in our nation's environment by switching industry from diesel and fuel oil to more efficient, cleaner-burning natural gas. We will also work with industry to identify other pro-environment financing opportunities with the goal of helping exporters do better by our local environment while simultaneously making their goods more competitive on the global market," Amer continued.
"The environmental benefits we will help finance will allow industry to produce greener products — a sought-after designation in global markets — and, in many cases, to become more cost-competitive as they do so."
On Monday, March 5th, NBE began providing the brick-makers in this first project with grants from its own resources amounting to 20% of total value of the project package. With a view to completely transitioning the industry to natural gas from oil-based fuels, the Bank is currently in talks with brick makers in Beheira governorate as well as the remaining factories in the Suff area that did not participate in this first project.
Project finance includes allocations for external works (EGP70m, including finance to build a pressure modulation station in the Suff area) as well as internal works at each plant, including kilns (accounting for the remaining EGP70m). The total cost of converting each plant to natural gas is EGP700,000.
NBE has other environmental finance facilities for industrial clients, including loans with subsidized interest rates of 2.5% for eco-friendly initiatives. Furthermore, NBE and DEG cooperate to donate 20-30% of the financing needed to projects intended to lower the environmental impact of industrial projects.