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Thursday, 3 November 2022

Gov’t wants USD 15 bn for nine food, water and energy projects under NWFE

The International Cooperation Ministry will seek blended finance for nine projects worth USD 15 bn in its Nexus on Water, Food and Energy (NWFE) program, the ministry said in a statement yesterday. The projects include a “massive energy project,” five projects in the field of agriculture and food security, and three in irrigation and water resources, the statement said. The projects aim to achieve the emissions targets in our recently announced nationally determined contributions (NDCs).

SOUND SMART- Blended finance — in this context — refers to a mix of financing from bilateral and multilateral lenders, the private sector, and the government. Drumming up blended and concessional financing for projects in developing nations will be a key theme at this year’s COP27 conference, where we expect to hear more announcements on funding for NWFE. The program is the government’s flagship initiative for getting climate finance to some of our most important green projects.

Some international finance institutions are already on board, and have announced a combined USD 2.3 bn of funding for the program:

  • The European Bank for Reconstruction and Development is committing USD 200-300 mn to the energy track of the program. The money will help Egypt to decommission 5 GW of gas-fired power plants starting next year.
  • The African Development Bank (AfDB) will provide more than USD 1 bn to NWFE, Bloomberg Asharq reported yesterday. Samuel Kamara, the bank’s country director, told the news outlet that the money would be split between the water, food and energy tracks.
  • The International Fund for Agricultural Development (IFAD) is committing USD 200 mn to the food track, regional director Dina Saleh told Asharq.
  • Other organizations partnering with IFAD are providing another USD 775 mn though their identities are yet to be revealed.

More climate finance news triggers to look out for at COP:

  • The ministry will launch its Sharm El Sheikh Fair Finance guide during Finance Day (9 November). The guide proposes a framework for climate finance for emerging markets.
  • The government will announce a partnership with the Climate Investment Funds (CIF) that promotes investments in sustainable agriculture and rural communities.
  • There will also be an event with the World Economic Forum (WEF) to promote PPP development projects, and another with the EBRD to promote green hydrogen cooperation.
  • Expect more details on an initiative with IFAD focused on resilience and adaptation.

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