World Bank Supports Egypt’s Quest for a Cleaner Logistics and Transport Sectors with $400M
World Bank has approved a $400 million development financing agreement to boost Egypt’s logistics and transportation sectors and support the transition to low-carbon transportation along the Greater Cairo Area (GCA) railway corridor.
The Cairo Alexandria trade logistics development project will include the construction of a railway bypass to the congested GCA area. The bypass will provide freight trains with an alternative route to the west of Greater Cairo between the Alexandria Sea Port and the newly constructed 6th of October Dry Port.
According to World Bank’s statement, the project will reduce greenhouse gas emissions by 965,000 tons over 30 years as the transportation sector “is the second largest contributor to Egypt’s greenhouse gas (GHG) emissions after energy contributing approximately 19 percent.”
The railway bypass will also allow 15 container trains per day by 2030, and 50 trains by 2060 as demand grows.
The project will also help the Egyptian government’s reform effort to improve the performance of the railway sector and encourage private sector participation by establishing an “Egypt’s Infrastructure Access Charging” regime. The charging system is similar to road tolls or airport fees. According to the World Bank, private investors can operate their trains on the tracks of the Egypt National Railways Authority for a fee, which will help the authority’s finances.
Rania A. Al-Mashat, Minister of International Cooperation, said “This agreement will support the Government of Egypt’s progress toward clean, smart transportation to reduce emissions, all within the framework of the green economy transition, while also increasing private sector participation in development efforts.”
The project is in line with Egypt’s most recent efforts to integrate into global value chains and establish itself as a regional trading hub. The anticipated reduction in greenhouse gas emissions contributes to Egypt’s 2050 Climate Change Plan as well as its recent sustainability efforts in the run-up to hosting COP27 in November.