Dr. Mohamed Farid:
Egypt is moving from conceptual frameworks to comprehensive institutional implementation of sustainable finance.
Egypt has implemented an integrated package of reforms across both the banking and non-banking financial sectors, driving a qualitative leap in sustainable finance issuances.
The Financial Regulatory Authority now requires non-bank financial institutions to measure their carbon footprint and offset 20% of annual emissions through the purchase of carbon credits.
Building a national carbon-emissions database has enhanced the precision of green finance allocation.
We aim to mainstream sustainability concepts across all financial institutions.
In the context of accelerating the transition toward a green economy and reinforcing Egypt’s position as a regional hub for sustainable finance, Dr. Mohamed Farid, Minister of Investment and Foreign Trade, participated in the Innovation for Resilience – Financing for a Sustainable Future Conference organized by the International Finance Corporation.
The event was attended by Mr. Hassan Abdalla, Governor of the Central Bank of Egypt; Mr. Ethiopis Tafara, IFC Regional Vice President for Africa; Mr. Jürgen Schulz, Ambassador of Germany to Cairo; and Mr. Olayemi Cardoso, Governor of the Central Bank of Nigeria.
The Minister affirmed that Egypt has moved beyond the theoretical discussion of sustainability concepts to institutional implementation supported by clear legislative and regulatory frameworks—enabling the market to attract sustainable finance and strengthening international investor confidence in Egypt’s capacity to adopt green growth standards.
Dr. Farid added that Egypt has rolled out a comprehensive package of structural reforms across both the banking and non-banking financial sectors, in close coordination with the Central Bank of Egypt and the Financial Regulatory Authority. These reforms have delivered a qualitative shift in the ecosystem for issuing sustainable financial instruments and enhanced the market’s ability to attract international investment, opening new horizons for financing sustainable development projects.
He noted that the true starting point for sustainable finance was the establishment of precise regulatory and legislative frameworks governing sustainability-linked debt instruments, through the inclusion of clear definitions and classifications in the Executive Regulations of the Capital Market Law—covering green bonds, transition bonds, gender bonds, and other instruments—thereby enabling multiple issuances by financial institutions and banks operating in the market.
The Minister explained that building a comprehensive and accurate carbon-emissions database constituted a cornerstone of Egypt’s sustainable finance framework, supported by mandatory sustainability and carbon-footprint disclosure requirements, based on the principle that “what cannot be measured cannot be managed.” This has ensured more efficient allocation of green finance in line with actual market needs and development priorities.
He further highlighted that the Financial Regulatory Authority has issued decisions requiring non-bank financial institutions with paid-in capital exceeding EGP 100 million to submit periodic reports measuring their carbon footprint, while offsetting approximately 20% of their annual emissions through the purchase of tradable carbon credits—reflecting a clear commitment to embedding environmental considerations at the core of financial and investment activities and advancing the transition toward a low-carbon economy.
Dr. Farid added that the current phase aims to expand the application of sustainability concepts across companies and institutions, in line with the principle of proportionality, whereby larger companies are subject to more extensive disclosure requirements, consistent with international standards—particularly IFRS S1 and S2—underscoring the pivotal role of both the banking and non-banking financial sectors in financing companies and supporting their transition toward more sustainable practices.
He also noted the significant progress of Egypt’s voluntary carbon market, with approximately 160,000 carbon credits registered to date, alongside the completion of the necessary regulatory and accounting frameworks governing registration and trading—paving the way for a new phase of expansion in sustainable project financing.
The Minister concluded by emphasizing the importance of strengthening regional and international cooperation in sustainable finance, commending the International Finance Corporation’s role in supporting developing economies, and expressing appreciation for organizing the conference, which brings together policymakers and financial institutions to explore innovative financing mechanisms for a more sustainable and resilient economic future
