The European Bank for Reconstruction as well as Development plans to initiate investment for at least €2.1 billion ($2.5bn) in the MENA territory this year, mostly within the Renewable Power as well as technology arena.
The London-backed lender has got invested within numerous other nations within the territory, that includes Egypt, Morocco, Tunisia, Lebanon, Jordan and the Palestinian territories of the West Bank and Gaza.
The Managing Director for Southern as well as Eastern Mediterranean territory at EBRD Heike Harmgart, further added out that: “The Preceding year, we did €2.1bn in the Mena region and this would roughly be similar to what we will do this year. We are a demand-driven institution and we have appetite to grow.”
Ms Harmgart also added that: “The EBRD’s investment will be around green technology via the renewables, green financing through banks, green investment in cities and the other focus will be financial inclusion. We will also look opportunistically at digitisation wherever we can.”
She was also prompt in stating that “We had played a huge significant role for the initial phase of Solar as well as Wind Energy generation within the MENA territory. We financed over half of Benban in Egypt and we financed most of the solar and renewable projects together with our partners in Jordan.”
The MENA territories Nations are also investing superior sums in renewables to diversify their energy mix.
The UAE is presently evolving a 2-gigawatt solar plant, the global largest, at Al Dhafra in Abu Dhabi. Egypt freshly finished building Benban, Africa’s largest solar park with a volume of 1.5 gigawatts.
Other nations like as Morocco, Jordan and Saudi Arabia also have significant renewable energy programmes.
The EBRD is a multidimensional lender set up in 1991 to aid in fund the recovery of Eastern Europe post the collapse of the Soviet Union. The bank, that had assets worth €68.2bn at the cease of 2019, far ahead widened its remit to include the MENA territory and Central Asia.
It is owned by 69 Nations from five continents, with the EU and the European Investment Bank among its shareholders.
The UAE lately became one of its newest members, with Sheikh Mohammed bin Rashid, Vice President and Ruler of Dubai, declaring that it had joined both the EBRD and the Shanghai-grounded New Development Bank the preceding month.
The UAE linking the EBRD will “support its businesses to be more active and have additional partners in neighbouring countries in the Mena region but also globally in Eastern Europe, Central Asia where we are active,” Ms Harmgart said.
The EBRD plans to capitalize in Algeria this year after the North African nation’s membership was permitted by the bank’s shareholders the preceding year.
“Algeria could commence this year as a new nation where we can look at investment prospects, particularly in the private sector as well as in the green area.”
The lender is evolving a series of climate action plans with cities where it is categorizing investment prospects that will offer a return and contribute to the drop in the carbon emissions.
“Amman is already a green city where we developed a climate action plan. This year, we are also going to add Cairo and Alexandria and, potentially, Tunis to the green city network,” stated Ms Harmgart.
“This includes developing holistic plans for cities where they can invest in changing the delivery of services towards green e-mobility investment and in metro systems, water and wastewater network.”
The EBRD conveyed a net profit attributable to equity holders of €1.3bn in 2019, up from €210 million in the preceding year, as impairment requirements on banking loan investments plummeted down and net interest income upsurged.
The bank is anticipated to report a profit for the 2020 financial year despite the COVID-19 pandemic, she said.
“We did make a profit for 2020 that we will announce shortly. The first quarter was dismal with equity markets being completely down and we thought we would end the year with loss but we made a profit. However, the profit is smaller than in other years.”
The lender is overviewing for taking equity stakes in appropriate projects. It has invested in evolving equity funds and a number of native lenders in recent years, including Armenia’s Ameriabank, Lebanon’s Bank Audi and a consortium that owns the concession to run Queen Alia International Airport in Jordan.
The lender aims to upsurge its equity investment to 8 percent this year, up from 4 percent the previous year, said Ms Harmgart.
“Last year equity markets were subdued due to the pandemic,” she stated. “This year, both equity funds are approaching us and also companies that are looking to diversify their shareholder base or preparing an IPO.”
Globally, the lender’s total investment grew to €11bn last year, up 10 percent on the previous year. The EBRD invested in 411 projects during the period.