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February 29, 2016

JICA oversees a new stage of cooperative relations between Egypt and Japan

On February 2016, The Egyptian President, H.E Mr. Abdel Fattah El Sisi, made a historical visit to Japan, opening a new chapter for the existing friendly and cooperative relations between the two countries. This visit figured high at public and official levels in both of Egypt and Japan, as it was the first visit by an Egyptian president to Japan since 1999.

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During the visit, on February 29, President El Sisi held talks with Japan international Cooperation Agency (JICA) President, Mr. Shinichi Kitaoka, where they discussed JICA's assistance to Egypt. President El Sisi expressed gratitude for JICA's efforts and mentioned cooperation in the electric power and transport fields as specific positive examples. He also confirmed his respect for Japan's culture and national characteristics, and expressed his interest in learning from Japan's experiences in the field of education, and expanding Japanese-style education in Egypt.

On the same day, JICA signed 3 new Japanese ODA loan agreements with the Government of Egypt to provide loans of up to a total of 54.2 billion Japanese Yen (around 455 million US$) for assistance for three projects. Following are the terms and amounts of loans.

Project title Amount (million yen) Annual interest rate (%) Repayment (years) Grace period (years) Procurement
Project Consulting services
Electricity Distribution System Improvement Project 24,762 0.3 0.01 40 10 General untied
Borg El Arab International Airport Extension Project 18,200 0.1 0.01 40 10 Tied*
Hurghada Photovoltaic Power Plant Project 11,214 0.1 0.01 40 10 Tied*

* Special Terms for Economic Partnership (STEP) apply.

Details of each project are as follows;

  1. Electricity Distribution System Improvement Project
    JICA will provide this loan to the Egyptian Electricity Holding Company (EEHC) to finance the Electricity Distribution System Improvement Project in Egypt.
    The objective of this project is to reduce the loss of energy and to improve the reliability and efficiency of the electricity distribution network for sustainable power supply in the target regions through upgrading of the distribution systems and installation of equipment including advanced smart meters. This in turn shall contribute to further economic and social development as well as climate change mitigation by reducing the greenhouse gas emissions through saving of fossil fuel.
    The project is targeting the service areas of three distribution companies namely North Cairo, Alexandria and North Delta which are serving more than 2.6 million customers.
    It is worth mentioning that this project comes within the government's plan for the development of electricity infrastructure and promotion of energy conservation to reduce fuel consumption and electrical losses in order to cope with the increasing demand associated with economic growth and prevent frequent power outages for better social and economic impacts.

  2. Borg El Arab International Airport Extension Project
    Under the project, the Borg El Arab International Airport which is located 40km Southwest from Alexandria city will be extended by the construction of a new terminal building (Terminal 2) and related facilities in response to the drastic increase in the number of passengers and aircrafts demand. In fact, this is the second cooperation to the Borg El Arab International Airport between the Ministry of Civil Aviation and JICA. The first was "Borg El Arab International Airport Modernization Project" under which Terminal 1 and other facilities were constructed and inaugurated in October 2010. Under this new project, the airport's capacity is expected to be strengthened and improved for additional convenience and safety of regional air transportation that will contribute to supporting sustainable economic development in Alexandria and the region.
    Furthermore, the airport plan includes installation of environmental friendly equipment to remit environmental load responding to global climate change. Though introducing Japanese excellent technologies, the airport will be operated by solar power electricity, high efficiency air-conditioning system, light emitting diode (LED), and other components that satisfy the concept of "Eco-Airport".

  3. Hurghada Photovoltaic Power Plant Project
    The Egyptian New & Renewable Energy Authority (NREA) will use this loan to finance the construction of a 20 MW photovoltaic power plant with power storage facilities in Hurghada, Red Sea Governorate in Egypt.
    This project will increase the electricity supply, stabilize the energy grid as well as promote the utilization of renewable energy and thereby, promoting socioeconomic development and climate change mitigation
    The finance is provided with very soft lending terms that are offered under the interest rate of 0.1% with 40 years repayment period including 10 years grace.
    It is worth mentioning that this project comes within the Egyptian government's plan to diversify its power generation mix to reduce dependence on fossil fuel sources from the current level of approximately 90%.
    JICA will proudly continue to support Egypt towards the realization of inclusive and sustainable growth, utilizing the Japanese technology and expertise, especially in the field of infrastructure development as it is the base of all social and economic developments.

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