Policy paper

UK–Egypt development partnership summary, March 2024

Published 27 March 2024

This was published under the 2022 to 2024 Sunak Conservative government

Introduction 

The International Development White Paper sets out a re-energised agenda for the UK working with partners to accelerate progress on eliminating extreme poverty, tackling climate change and biodiversity loss, and accelerating progress on the United Nations Sustainable Development Goals (SDGs) by 2030. In a contested world, where ODA alone will not be enough, achieving the vision as set out in the SDGs requires a radical rethink in our approach to international development. The White Paper sets out how our partnerships are central to this approach. These are founded on mutual respect, with an emphasis on country ownership, accountability, transparency and common values. This Country Development Partnership Summary details how the approach detailed in the White Paper will be put into practice with Egypt.

Country context 

Egypt is the third largest economy in the Middle East and North Africa (MENA) region and the second largest in Africa. The country’s economy is diversified, with hydrocarbons, manufacturing, tourism and agriculture playing a major role. Following a period of political unrest in 2011-13, President Abdel-Fattah El-Sisi came to power, and has periodically sought to enact economic reforms, including in 2016. After the 2011 revolution and subsequent political turmoil, macroeconomic performance improved significantly between 2016 and 2019 with the implementation of an IMF-backed reform programme. Nevertheless, the economy was then hit by Covid-19, which disrupted economic activity.  

Although Egypt weathered the pandemic relatively well (with IMF support) and was one of the few countries globally that recorded positive growth (about 1.5%) in calendar 2020, the Russia/Ukraine crisis dealt another blow to the economy exposing structural imbalances that could no longer be ignored. 

In December 2022, Egypt signed its third programme with the IMF in 6 years. The programme aims to preserve macroeconomic stability, strengthen social safety nets, and push forward deep structural and governance reforms to promote sustainable private sector-led growth and job creation. The Egyptian authorities committed to further fiscal consolidation, moving to a durably flexible exchange rate, and introducing deep structural reforms to create a level playing field between public and private businesses. Reforming the business climate is necessary to unleash the country’s huge economic potential.     

In 2016, the Government of Egypt (GoE) launched Egypt Vision 2030. The vision represents GoE plans and objectives towards the country development by 2030. It adopted the concept of sustainable development as a general framework to improve the quality of life for citizens in the present and ensure that the future of next generations is not jeopardised. The vision is divided into 3 dimensions: political, social and environmental. Each dimension has its own indicators and targets that need to be met by 2030.  

Women and girls remain high priority for GoE, following the launch of Egypt Vision 2030, in 2017 The National Council for Women (NCW) announced The National Strategy for the Empowerment of Egyptian Women 2030. The vision demonstrates GoE commitment towards women and girls’ rights. It is divided into 4 main pillars: political empowerment, economic empowerment, social empowerment, and protection. 

Why and how? The UK’s development offer with Egypt 

Egypt and the UK have a strong relationship that is based on solid partnerships including international development, trade, climate, and bilateral relationships. Egypt is an important and strategic partner to the UK in the MENA region. Both the UK and Egypt are committed towards strengthening the bilateral relationships through development partnerships. The UK’s mission priorities in Egypt focus on climate, economic prosperity, security & stability, and connection.  

Through these priorities, the UK mission is delivering the following:  

1. Climate

Building a strong UK/Egypt long term Climate Partnership. We will use the legacy of COP27 to ensure a sustained dialogue across our shared climate priorities. We will support high quality technical assistance to help Egypt green its economy. We will prioritise green trade and investment opportunities (particularly renewables). 

2. Economic prosperity

Working to create the right ecosystem (including good business environment and stable and sustainable growth) for mutual UK-Egypt trade and prosperity. Through programmes, we will support economic reform, both to improve economic stability and social rights, as well as improving market conditions for UK companies. We will take advantage of Egypt as a British International Investment (BII) ‘powerhouse’ country and pursue investment opportunities.  

3. Security and stability

We will seek stability for vulnerable groups including women during economic shocks. Through programmatic interventions, we will work on food and water security as well as combating Gender Based Violence (GBV).  

4. Connection

We will seek to deepen and widen the bilateral relationship between the UK and Egypt in terms of people-to-people, institution to institution and government to government links through development programmes, whilst managing difficulties and challenges in the relationship where there are differences.  

The UK’s mission areas of work in Egypt echoes the International Development Strategy’s (IDS) and International Development White Paper’s priorities. We approach this by tackling the structural problems of Egypt patiently and by building strong economic and social foundations that underpin long-term development. The UK mission in Egypt will deliver these objectives through country and bilateral programmes. 

Who we work with 

The UK mission and the GoE has a strong relationship, and our partnership has been demonstrated through successful delivery of joint projects, as well as our constant and constructive conversations on crucial domestic and international issues such as the recent Sudan crisis.  

The UK mission in Egypt collaborates with a variety of local and international partners, including local civil society organisations, development partners and other key GoE partners. Our closest development partner is the World Bank, which delivers our only standalone bilateral ODA programme. The UK mission is keeping a constant and open conversations and programmatic partnerships with International Financial Institutions like the International Monetary Fund and the World Bank to push forward key reforms, particularly in the macroeconomic space. Similarly, the UK mission maintains close relationships with the UN agencies through either programmatic approach or regular conversations, as well as regional development banks such as Africa Development Bank and European Bank for Reconstruction and Development. 

Key programmes 

The UK has a large ODA footprint to support a stable, prosperous Egypt. This includes the £400 million British International Investment portfolio, and a $2 billion portfolio guarantee to AfDB to support additional lending in Africa including Egypt. It also includes £4 million of technical assistance grants a year through the World Bank to support economic, social and private sector development, and further funds for projects targeting climate, GBV, and food and water security through the Conflict Security and Stability Fund (CSSF). 

1. The Strategic Partnership for Egypt Inclusive Growth (SPEIG) Programme

Also known as UK-Egypt World Bank Trust Fund, this is the UK mission flagship Economic Development programme and only bilateral ODA programme in Egypt. The programme started in 2017 and disbursed £15 million in technical assistance grants over 3 years. The project was renewed for a second phase in 2021 (due to end in 2025) with another £17 million allocated over the 5 years. The WB Trust Fund programme works by funding complementary Technical Assistance (TA) to enhance World Bank loan operations in Egypt. A relatively small contribution of £4 million per year through the WB Trust Fund has therefore enabled us to leverage and influence the full $6 billion World Bank financing portfolio through targeted TA. We focus primarily on increasing the quality and implementation of economic reforms. SPEIG is providing technical assistance and analytical services to GoE at main 3 main areas economic resilience and competitiveness, social protection and inclusion, and climate action. 

2. The Conflict Security Stability Fund Programme (CSSF)

The programme will deliver projects that aim at ensuring food and water security in Egypt, as well as tackling gender-based violence. In December 2022, the CSSF launched a UK Fund: “For Her With Her” which aims at Prioritising Prevention and Supporting Gender Based Violence victims. In addition, training will be provided to strengthen Government of Egypt policy and capability, working government to government as peers.  

3. Climate

We support green transition in Egypt through a portfolio of over $240 million in grants, investment and technical assistance. This includes $105 million through the Green Climate Fund, $43 million through the Global Environment Facility, and $25 million through the Climate Investment Fund towards Sustainable Urban Infrastructure. It also includes £5 million for Egypt’s Nexus of Water, Food and Energy (NWFE) programme, $20 million of support for energy transition, $4.5 million to support solar panel uptake among small industrial businesses, and $1.2 million for the Egyptian private sector through the UK Climate Finance Accelerator programme. We are also investing $9 million to back Egypt’s first commercial green hydrogen plant in Ain Sokhna, part of a wider $63 million investment. 

Links 

• Egypt DevTracker Page 
• British Embassy Cairo