The International Finance Corporation (IFC) announced a new partnership with Orascom Development Holding’s largest subsidiary, Orascom Development Egypt (ODE). The partnership aims to enhance energy and water efficiency and reduce greenhouse gas (GHG) emissions in several hotels in El Gouna, one of Egypt’s most popular tourist destinations.
Under this partnership, IFC is providing ODE with a Sustainability Linked Loan (SLL) worth $155 million. The loan, comprising USD 96 million, will fund green improvements, including renovations at Mövenpick El Gouna.
Green Improvements to Enhance Resource Efficiency
The SLL will enable ODE to implement a series of sustainability initiatives to improve the environmental performance of its hotels. The measures include heat pumps, solar heaters, and water conservation systems, reducing energy use by 50% and water by 20%.
Additionally, the SLL will fund green upgrades and allow ODE to refinance debt, improving its financial profile and liquidity. The loan will be the first of its kind issued to a tourism and real estate company in Egypt and has been verified by Moody’s.
IFC will also support Orascom Development’s efforts to obtain EDGE certification for green buildings at its hotels in El Gouna. EDGE, an IFC-led initiative, promotes resource-efficient buildings, enhancing ODE’s sustainability credentials and supporting its eco-friendly tourism infrastructure goals in Egypt.
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Strengthening Egypt’s Tourism and Economy
Tourism accounts for 8% of Egypt’s GDP, supports 2.5 million jobs, and is expected to create 1.5 million more. This partnership aims to make the sector more sustainable and competitive, aligning with Egypt’s economic growth goals.
Omar El Hamamsy, Group CEO of Orascom Development, said, “This partnership with the IFC marks a pivotal milestone in Orascom Development’s journey towards fostering resilient, sustainable, integrated communities.”
He added, “Our environmental commitment is reflected in our continued proactive measures towards enhancing energy efficiency and water conservation across our destinations, including El Gouna by the Red Sea. This partnership reflects our commitment as a global developer in contributing to a healthier planet, by creating vibrant destinations that harmonize with nature and boost Egypt’s economic growth.”
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Supporting Egypt’s Climate Ambition
The project aligns with Egypt’s Country Climate and Development Report (CCDR), supporting development goals and climate ambitions. It also supports the World Bank’s Country Partnership Framework (CPF), aiming to create jobs and improve resilience to shocks.