Cairo

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an accelerating pace, Egypt is moving towards a green economy, after allocating half of the budget for the fiscal year 2024-2025 to it, which raises questions about the nature of this economy, the reality of this trend, its impact on Egypt, and its chances of success, in addition to the size of what Egypt has accomplished and what it aims for in the future. .

The green economy is defined as an economy that aims to improve human well-being and social equity, and is characterized as an economy based on minimum emissions of carbon dioxide and pollution in general, in addition to significant support for employment and income growth and the integration of the four dimensions of sustainable development: environmental, social, economic and technological. The green economy differs from the fossil economy, which is known as the "brown economy".

The Egyptian strategy in the green economy depends on plans to launch a number of mega projects in the field of renewable energy.

This comes at a time when Egypt is scheduled to host the United Nations Climate Change Conference (COP27) next November in Sharm El-Sheikh, which the Egyptian government considers the first Egyptian city to completely transform into a green city.

Despite the promising international and local talk about the green economy or its results, there are challenges facing Egypt in the phase of transition to it, most notably the high cost, good planning, and the lack of health services and clean water in some areas, and the shift towards a green economy may force the state to abandon high-return economic activities. But it harms the environment, according to research studies and specialists.

Economists agree that the issue of Egypt's transition to a green economy is still in its infancy, and has not yet reached a comprehensive stage, although the chances of its success are great in light of the transition to current planning, or the launch of giant projects such as the New Administrative Capital (about 60 km east of Cairo). .

chances of success

Economist Abdel Nabi Abdel Muttalib believes that the shift towards a green economy is a global trend, and Egypt has developed a strategy to move towards it that includes several points, the most important of which is taking into account the environmental dimension in 50% of the projects that will be implemented during the coming period.

In statements to Al Jazeera Net, Abdel Muttalib referred to the Egyptian government's announcement that it has about 691 projects at a total cost of about 447.3 billion pounds in the field of green economy, including the fields of energy, electricity, transportation and housing.

But the economic expert believes that the issue of the transition to the green economy in Egypt is still in its beginnings, and has not yet reached a comprehensive plan. As for the chances of success of the green economy in Egypt, he stressed that they are very large, especially in light of the move to the new administrative capital.

Abdul Muttalib pointed out that there are reports received about work systems in the administrative capital indicating that they require meeting international standards to preserve the environment, reduce carbon emissions, and use clean energy, whether using renewable energy, or even green hydrogen in all its projects.

On Egypt's motives for shifting towards a green economy, the economist said that Egypt is counting on it because it reduces pollution, reduces production costs, and helps increase the use of resources in a better and more sustainable manner.

The journalist specializing in economic affairs, Ibrahim Al-Taher, agrees with Abdel-Muttalib that Egypt had Arab and Middle Eastern leadership in entering this field, especially after issuing green bonds for the first time in the Middle East and Africa, in late 2020.

Green bonds are bonds aimed at providing financing for environmentally friendly projects, reducing the cost of financing on government papers, and encouraging clean investments in the region, and they began to appear globally in 2008.

Despite the promising talk about the blue economy or its results, Al-Taher saw - in previous TV statements - that the road is still long, especially for a country like Egypt, explaining that the volume of air pollution in Greater Cairo, for example, costs the government 47 billion pounds annually, according to a previous study by the World Bank. .

Moreover, Egypt currently, according to Al-Taher, depends more than 96% on fossil fuels, while its dependence on renewable energy does not exceed 4%, although the government seeks to increase it.

He stressed that access to these projects is not easy, because it will affect large industries that currently depend on traditional energy, which may result in large losses, especially in employment, and many investors are reluctant to enter the field of green companies.

Greening the economy

Egypt is counting on the United Nations Climate Change Conference, which it will host at the end of this year, to enhance its efforts to implement the "Egypt Sustainable Development 2030" strategy, as the environmental dimension is a major dimension of the strategy, in parallel with Egypt's endeavors and efforts for green recovery.

Last May, Cairo launched the "National Climate Change Strategy for Egypt 2050", which has a total cost of $324 billion.

Egypt had allocated, according to government reports, about 15% of the state’s general budget expenditures for the current fiscal year 2021-2022 for this matter, and the percentage increased in the draft budget for the new fiscal year 2022-2023 to about 30% to support “green economy” projects, equivalent to About 336 billion pounds, and half of the 2024-2025 budget was allocated for the same thing.

Egypt is also the first country in the Middle East and North Africa region to issue sovereign green bonds in the global markets, with a value of $750 million for 5 years.

In an interview with the US Associated Press (AP), Egyptian Foreign Minister Sameh Shoukry called for the implementation of previous international commitments and commitments in all sectors of the climate change agenda, whether in adaptation, mitigation, financing, or compensation for losses and damages due to pre-industrial times.

The European Bank for Reconstruction and Development - based in the United Kingdom - had approved a country strategy to support the Egyptian program for reform and green economy, and this five-year strategy between the Bank and Egypt, starting from the current year 2022 until 2027, is based on several axes, most notably the green transformation at the level Economic.

In the field of producing green hydrogen (a source of clean energy), the Egyptian government signed an agreement to produce it in Egypt, as an intermediate material for the production of green ammonia, in partnership between the Sovereign Fund of Egypt and Norwegian, Dutch and Emirati companies.

Egypt began to pay attention to this type of economy as one of the main means in comprehensive development plans, according to a government report issued in late 2020, which highlighted the state's orientations towards green economy projects, which are based on 6 main sectors: water management, renewable energy, Land management, sustainable transportation, waste management, and green buildings.

Among the most prominent green projects implemented and underway are:

  • Benban solar energy complex project in Aswan Governorate (south).

  • Electricity generation project using pumping and storage technology in Jabal Ataka in Suez Governorate (Northeast).

  • Wind power plant project in the Gulf of Suez.

  • The electric train project, which targets about 500,000 passengers per day.

  • The linear project "Monorail" in the Administrative Capital and 6th of October City (west of Cairo), which targets about 650,000 passengers per day.

  • Increasing the number of cars converted to run on natural gas by 44.9%, to reach 325,000 cars in 2020, compared to 224.3 thousand cars in 2016.

  • Bahr al-Baqar water treatment plant in Sharkia Governorate (North).

  • Sea water desalination plant in El Alamein (Northwest).