The World Bank announced today a new US$200 million investment project to support the next generation of reforms in Egypt aimed at creating more opportunities for young people and women. The project will focus on expanding the amount and access to credit for small and medium enterprises, which have proven to be a major source of growth and job creation.
The ‘Catalyzing Entrepreneurship for Job Creation’ project is designed to address the major obstacles that young people and women face when launching new businesses. In an economy where the financial system is dominated by banks lending primarily to mature businesses, the project will channel US$145 million mainly through non-bank financial institutions offering loans to small businesses. This project component will have established lending targets for women and youth-led businesses, first-time borrowers, and small business in less developed regions across Egypt. The project will also fund coaching opportunities for new businesses through the entrepreneurial life-cycle to build the necessary skills and capacity for success
The project also aims to increase the supply of seed, early-stage, and venture capital going to riskier and innovative start-ups and young small and medium enterprises with high potential for growth and job creation. To build up the early-stage investment ecosystem in Egypt, the project will invest US$50 million in privately managed risk capital intermediaries, such as angel funds, accelerators, VC funds, and investment companies.
A call for proposals will be issued, with international players encouraged to apply, and the funds distributed through a transparent and competitive selection process. The aim is to leverage the technical capacity and know-how of the private sector in investing these funds.
The new program builds on the success of the ongoing 'Promoting Innovation for Inclusive Financial Access’ project which provides small and medium businesses with access to finance and promotes private sector job creation across Egypt. To date this project has created about 300,000 jobs, benefitting approximately 70,000 women and 56,000 youths.
The World Bank has a diverse package of support to Egypt focused on expanding social protection and social inclusion to all citizens, improving competitiveness and infrastructure in less developed parts of Egypt, developing a digital development strategy for the jobs of tomorrow, leveraging private sector investments for infrastructure, and reforms in the education and health sector to help build human capital. The World Bank currently has a portfolio of 16 projects in Egypt with a total commitment of US$6.69 billion.
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