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Monday, 26 December 2022

Egypt secures USD 500 mn from the World Bank to support Takaful and Karama

Egypt’s Takaful and Karama program gets a boost: The World Bank has agreed to a USD 500 mn loan in development financing to expand and strengthen the Takaful and Karama program amid soaring food and energy inflation, according to an International Cooperation Ministry statement and a WB statement (pdf). This is the third round of financing from the multilateral lender for the social safety program, following a USD 400 mn loan in 2015 and another USD 500 mn loan in 2019.

Where’s the money going? The loan will help expand the program’s coverage and enroll more families into economic inclusion to mitigate price shocks, the World Bank statement reads, without disclosing specific targets. The first two loans helped enroll 3.7 families into the program — amounting to 12.8 mn citizens, according to the ministry statement.

Background: The program was launched in 2015 to provide income support to the country’s most vulnerable citizens via cash transfers. The Madbouly government rolled out new emergency social protection measures worth EGP 11 bn in July and another set of measures in October to mitigate the impact of the economic crisis on the poorest. These measures will see an extra 1 million families brought into the program bringing the total number of beneficiaries to 20 mn.

It’s also a priority for the IMF: The IFM newly-approved USD 3 bn facility aims to expand the coverage of the cash transfer program Takaful and Karama by an additional 5 mn families.

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