Egypt is actively looking for bank credit to bolster its strategic reserves and buy necessities in order to improve food security.
Officials from First Abu Dhabi Bank Egypt recently met with Sherif Farouk, the Egyptian Minister of Supplies, to explore how to strengthen collaborations with the business community and financial institutions.
They emphasised the value of bank funding for enhancing the infrastructure of internal commerce and looking into potential investments in the food sector.
This programme is a component of Egypt’s larger plan to increase food security in the face of supply chain disruptions and growing global inflation.
The meeting comes after Egypt’s official grain purchaser, the General Authority for Supply Commodities, released its biggest-ever tender in August for 3.8 million metric tonnes of wheat.
Farouk underlined the significance of bolstering cooperation with pertinent organisations in several crucial domains, such as funding the import of necessities, boosting strategic reserves, and expanding the Egyptian commodities exchange. He also emphasised the necessity of building more silos and having larger storage capabilities.
Hossam El-Garhy, the deputy head of the General Authority for Supply Commodities, and Ahmed Kamal, the assistant minister and ministry spokeswoman, were present at the meeting.
Farouk emphasised the importance of creating new opportunities for collaboration with financial institutions and strengthening partnerships with the private sector.
The minister examined FAB Egypt’s banking services, financing, and investment opportunities and discussed potential cooperation with the General Authority for Supply Commodities. The aim is to fund the purchase of essential items, strengthen strategic reserves, and enhance the infrastructure for commodity exchange.
Fayad expressed strong interest in enhancing collaboration with the ministry and its associated entities in areas such as domestic trade, food security initiatives, and funding various ministry projects. These projects include the construction of silos, strategic warehouses, logistics zones, and wholesale and semi-wholesale markets.
Egypt is a major global wheat importer and heavily relies on wheat to subsidise bread for tens of millions of its citizens. The General Authority for Supply Commodities (GASC) alone imports about 5.5 million metric tonnes of wheat annually for this purpose.
Currently, GASC is looking for wheat shipments for two periods each month: the 1st to 15th and the 16th to 30th, starting from October through April. There’s a specific shipment window in February from the 16th to the 28th. The authority wants to purchase the wheat on a free-on-board basis using 270-day letters of credit.