Minister of International Cooperation Sahar Nasr disclosed the terms of three Japanese loans that will finance Egyptian national projects.
The loans, which will be finalised during President Abdel Fattah Al-Sisi’s visit to Japan, will have an interest rate between 0.1-0.3%.
The loans will be repaid over a period of 40 years with a grace period of 10 years, Nasr told state-owned Al-Ahram in an interview published on Sunday.
The Japanese loans will finance three public projects. The first is the construction of a passenger terminal in Borg Al-Arab Airport in Alexandria to accommodate an additional four million passengers at the cost of $155m. Nasr said the second project will be to increase the efficiency of electricity distribution companies at a cost of $210m. The third loan will fund the construction of a power plant in Hurghada at a cost of $95m.
Nasr said Egypt also aims to extend the funding parameters to resume the construction of the Egyptian Grand Museum near the Pyramids.
Last week, the Ministry of Electricity and Renewable Energy was reported to be planning to sign four memoranda of understanding (MOU) and three loans with Japanese companies and financial institutions during Al-Sisi’s visit.
Al-Sisi arrived in Japan on Sunday.
Japanese Prime Minister Shinzo Abe visited Egypt in January 2015. Japan signed agreements to provide $360m in financial support in the energy sector. Last year, Japan allocated nearly $200m to support Arab countries to fight “Islamic State” (IS) forces and to promote social and political stability.
There are 50 Japanese companies working in Egypt in different sectors. Total Japanese contributions to the capital market are estimated to be at $203m. The volume of trade exchange between Egypt and Japan in 2012 increased by 34%, amounting to $3bn compared to $2.2bn in 2011, according to the latest published figures in the Ministry of Foreign Trade and Industry’s annual report.
Egyptian exports to Japan increased by 40% in 2012 to approximately $1.2bn compared to $873.2 during 2011.