RIYADH: Egypt has signed agreements with the UAE’s Abu Dhabi Future Energy Company, also known as Masdar, to assemble hydrogen plants in the Suez and Mediterranean regions with the aim of producing 480,000 tons of green hydrogen annually by the year 2030.
The country’s draft budget that was sent to the Financial Affairs Committee showed an increase in the subsidies, grants and social programs fund by 13.6 percent from 2021/22 to 2022/23 which was greatly attributed to the war in the Eastern region, as stated in a report by the Ministry of Finance.
Green energy development
Egypt reinforced its recent go-green vision by signing two memoranda of understanding to assemble hydrogen plants across the Suez Canal Economic Zone and on its Mediterranean coast, according to a cabinet statement.
These were signed with Masdar, and the Hassan Allam Properties company in a ceremony where Prime Minister Mostafa Madbouly and other government officials were present.
Both companies are said to have formed a consortium aiming to develop 480,000 tons of green hydrogen annually by the year 2030.
Egypt’s sign up is part of the country’s effort to cultivate its green energy investment market, by promoting internal and external engagement, added the statement.
In an effort to locally produce clean-burning fuel, the country has been reviewing multiple offers from abroad regarding green hydrogen production in the Suez Canal Economic Zone.
Egypt is also in the process of turning its Suez Canal into a ‘green route’ before hosting the 2022 UN Conference of Parties on Climate Change in November.
Finance
Egypt’s 2022/23 subsidies, grants and social programs fund grew by 13.6 percent from the previous year, largely in an attempt to alleviate the repercussions caused by the Ukraine war.
The draft was sent to the Financial Affairs Committee, after being voted on by Egypt’s House of Representatives on 17 April to be discussed in hearing sessions.
First round figures show that the 2022/23 budgetary allocations to grants, subsidies and social protection programs amounted to 356 billion Egyptian pounds ($19.17 billion) compared to 321.3 billion Egyptian pounds, as seen in a report by the Ministry of Finance.
“This increase comes to protect the poor and limited income classes from the negative economic impact of the war in Ukraine,” said the report.
Since the world’s largest wheat importer relies on half of its imports from Ukraine and Russia, the global rise in wheat and oil costs adds financial pressure on Egypt’s new budget.
“The significant increase in subsidies to fuels and basic supply commodities [is attributed to] to the necessity of covering any expected hikes in prices of global wheat and oil prices.” Yasser Omar, deputy chairman of the House’s Budget Committee, told reporters.