International Finance Corp (IFC), a member of the World Bank Group has agreed to provide $635m financing for the development of solar parks that will produce 500MW of clean energy in Egypt.

The project includes construction of 11 solar power plants in Benban, near Aswan, with an investment of $730m.

IFC's investment in the project is considered as one of the largest private foreign direct investments in the country in power sector in the recent years.

The project is part of Egypt’s solar feed-in tariff programme (FIT) that is aimed at mobilising private investment for the construction of the solar photovoltaic generation park.

It is expected to help the country tap its huge solar potential, at the same time create an economic opportunities by driving the local economy, including the creation of temporary and long term jobs, while reducing greenhouse gas emissions.

Egypt’s solar FIT programme also includes projects financed by other institutions such as European Bank for Reconstruction and Development and Proparco. The programme is expected to attract an investment of $2bn. 

IFC Middle East and North Africa Director Mouayed Makhlouf said: “This landmark investment demonstrates that when you have the right reform policies, and a government willing to allow greater involvement by the private sector, you can attract investors in every sector, including infrastructure.

“Investments like these are the nucleus for economic growth, which is needed in Egypt.”

In April, IFC and Amundi announced the creation of a new $2bn fund which will be used for investing in clean energy in emerging markets.

IFC has committed to an investment of $325m in the new green fund which in turn will buy green bonds issued by banks across Asia, Africa, Latin America, the Middle East, Central Asia and Eastern Europe.

Image: IFC agrees to provide $635m finance for 500MW solar project in Egypt. Photo: Courtesy of RK008/