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World Trade Center, 1191 Corniche El-Nil, Boulaq, Cairo, Egypt

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Egypt Overview

Egypt continues a process of political transition. Following President Hosni Mubarak’s ouster in February 2011, free parliamentary and presidential elections were held and Mohammed Morsi became president with almost 52% of the vote. A newly drafted constitution was confirmed in a referendum in December 2012. In June 2013, mass demonstrations against President Morsi erupted. 

A 48-hour ultimatum by the Supreme Council of the Armed Forces expired and a government takeover by the leadership of the armed forces took place. The head of Egypt's Supreme Constitutional Court was appointed interim president and the 2012 Constitution suspended. The interim president issued a timeline for political transition and an interim government was sworn in. A new constitution was approved in a referendum held in January 2014. In February, the cabinet resigned and an outgoing housing minister, Ibrahim Mahlab, became prime minister and was asked to form a government to organize new elections.

Amid the political turmoil, economic growth remains weak with a high fiscal deficit and gross public debt (domestic and external) rising to nearly 100% of GDP at the end of June 2013. Low growth rates posed the danger of fuelling social frustration as they could not deliver the numbers of jobs and opportunities needed. Unemployment reached over 13% in June 2013. Critically, more than three-quarters of the unemployed are between 15 and 29 years of age.   

The Gulf States have pledged a large amount of exceptional financial assistance for Egypt’s transitional period. In mid-2013, Saudi Arabia, the UAE and Kuwait pledged an aid package totaling around US$17 billion to support Egypt. This included cash grants of US$5 billion, in-kind grants of US$4 billion, interest-free deposits with the Central Bank of Egypt (CBE) of US$5 billion, and project financing of around US$3 billion.

Last Updated: Mar 17, 2014

An Interim Strategy Note (ISN), endorsed by the World Bank Board of Directors in June 2012, defined the Bank’s program of support for the government. The ISN had been based on the three pillars of economic management, jobs and inclusion. It focused on actions expected to lead to sustainable, longer-term benefits. The objectives of the measures are: improving economic management through control of the fiscal deficit and initiating reform to improve transparency in government operations; creating opportunities for short-term, productive job-creation, particularly for women and young people, and initiating steps to improve the environment for longer-term private sector job creation; and fostering approaches that will broaden access and participation in the delivery of economic and social services for disadvantaged groups, again with special attention paid to women and young people, and to regions of the country lagging behind in terms of development.

The Bank is preparing a Country Partnership Strategy for Fiscal Year (FY)15-18 and has started a comprehensive process of consultations with the government and various stakeholders. In keeping with poverty reduction and shared prosperity, this dialogue will determine the strategy’s new focus areas.

Egypt is eligible for lending from the International Bank for Reconstruction and Development (IBRD). The Bank’s current portfolio includes 25 projects from the IBRD for a total commitment of US$4.6 billion. 

Access to Finance for Micro and Small Enterprises (MSE) Project: More than 75,000 loans have been disbursed to Medium and Small Enterprises (MSEs), leading to the creation of over 100,000 job opportunities. Importantly youth, suffering disproportionately high unemployment rates, have been effectively targeted, with beneficiaries between the ages of 21 to 35 representing 60% of all microfinance lending from January 2011 to June 2013.

The strong impact on gender mainstreaming is seen in the increase in the number of female-owned MSEs from about 4,600 to about 20,500 between June 2012 and June 2013, representing 25%  of financed projects. In light of regional disparities, the project allocated approximately 40%  of the value of disbursed micro loans, and 30% of small loans, to previously underserved governorates.

 Affordable Mortgage Finance Project: The Bank’s support was instrumental for the increase of the mortgage market. By June 2013, more than 8,400 mortgage-linked subsidies had been disbursed, and the supply of new units in the affordable housing range is expected to pick up. The government will build 75,000 new units of 75 m² for a sales price of LE100,000 Egyptian pounds. The legal, regulatory and institutional framework for the Mortgage Finance Subsidies Program was strengthened, and the institutional framework to enhance transparency put in place.

Labor Intensive Public Works Program: The project reached more than 3,000 beneficiaries of which 67% were female, 80% came from Upper Egypt, and 82% were youth. Furthermore, in order to expand social protection for the most vulnerable, a World Bank multi-sector team provided technical advice to the government on subsidy reform and cash transfers and supported the establishment of an inter-ministerial Technical Working Group to design a cash transfer program.

Energy projects: The Natural Gas Connections Project has successfully financed gas connection to more than 365,000 households representing 15% of connected households in Cairo and Giza governorates. The project has connected more than 90,000 low income households to the gas distribution network and created more than 3,000 jobs, mainly in network installation and maintenance. The World Bank also supported the building of gas-fired power plants as well as a project for high-voltage transmission lines and a wind power plant. The Helwan South Power Project includes a specific grievance redress mechanism to avoid disputes with local stakeholders.

Water and irrigation projects: More than 40,000 farmers are benefiting from improved wastewater collection and treatment services. Also irrigation and drainage services have been improved for more than 680,000 beneficiaries. Moreover, the World Bank helped establish 9,800 water user associations, and successfully completed the first wastewater pilot project of this sort in Egypt.

Transport projects: The World Bank supports the rehabilitation and expansion of an existing terminal (Terminal 2) at Cairo airport, and is contributing to the modernization of railway signals between Alexandria and Assiut.

Investment support: The Multilateral Investment Guarantee Agency reinsured the United States Overseas Private Investment Corporation’s coverage of Apache Corporation’s investments in its subsidiaries in Egypt.


Egypt: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments

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