In a statement, the AFC stated that the loan’s proceeds will contribute to the country’s economic resilience through financing purchases of petroleum products and agricultural commodities
The Africa Finance Corporation (AFC), in partnership with the International Islamic Trade Finance Corporation (ITFC), announced a new $250 million Sharia-compliant trade loan facility to Egypt to finance purchases of crucial commodities.
In a statement, the AFC stated that the loan’s proceeds will contribute to the country’s economic resilience through financing purchases of petroleum products and agricultural commodities.
The loan will be evenly split between the Egyptian General Petroleum Corporation (EGPC) to support the buying of fuel and petroleum products, and the General Authority for Supply Commodities (GASC) to improve food security by facilitating the imports of agricultural commodities, such as wheat, corn, vegetable oils, and sugar.
The trade loan facility, meticulously structured following Sharia principles, represents a dynamic response to the evolving economic landscape in Africa, AFC wrote.
“This underscores AFC’s commitment to collaborate with powerful partners such as the ITFC to deliver the financial innovation required to transform the African continent by driving local manufacturing, domestic value-addition of primary commodities and local job creation,” explained Samaila Zubairu, President and CEO of AFC.
CEO of the International Islamic Trade Finance Corporation, Hani Salem Sonbol, stated that the loan reaffirms the ITFC’s commitment to supporting the economic growth and stability of its members, noting that the $250 million loan reflects the “strength and power of multilateral financial institutions coming together to address Africa’s economic challenges”.
Egypt was formally welcomed into the Africa Finance Corporation in March 2023 as its first North African sovereign shareholder.
The AFC and ITFC provided Egypt with loan facilities worth $50 million back in November 2022.
Islamic banking represented 5% of the overall Egyptian banking market after reaching EGP 562 billion in September 2023, according to a November report by the Egyptian Islamic Finance Association (EIFA).
