Skip to main content

Saudi Arabia secures funding for electricity interconnection with Egypt

Egypt just approved a plan to ration electricity, though the government said there is not a shortage of power.
This picture taken on Jan. 13, 2022, shows a view of the Shubra al-Kheima natural gas electrical power station.

Saudi Arabia announced today new funding for its electricity interconnection plan with Egypt. 

The Saudi Electricity Company said it secured a 14-year facility worth $567.5 million to finance the Saudi Arabia-Egypt electricity interconnection project. The deal was signed by the British bank Standard Chartered and Japan’s Sumitomo Mitsui Banking Corporation and is guaranteed by the Swedish government’s export credit agency, the official Saudi Press Agency reported. 

A facility refers to a line of credit that can be drawn upon within a set time frame. In this instance, Standard Chartered and Sumitomo Mitsui will provide the Saudi Electricity Company with the requested funds. Sweden will pay the banks the money borrowed should the Saudi firm not be able to pay. 

Export credit agencies provide financing for international trade. 

What it means: Electricity interconnection occurs when one country connects its electricity system with another’s. Work began on the Saudi-Egypt interconnection project earlier this year, and Egypt expects it to be finished by 2026. The interconnection will provide Egypt with 3,000 megawatts of power at a cost of $1.8 billion. 

One megawatt of electricity can power hundreds of homes. 

Why it matters: Egypt does not have the severe electricity shortages that some other countries in the region have. The country has experienced widespread power cuts in recent years, however. 

The Egyptian Cabinet today approved a plan to ration electricity. The purpose of this is to save on natural gas and thus export more gas in an effort to gain more foreign currency. Egypt’s currency shortage is due to less tourism from Russia and Ukraine amid the war there, as well as rising commodity prices, according to Reuters

Egypt’s Electricity Ministry said yesterday the country is not facing an electricity shortage. 

Saudi Arabia and Egypt have strong economic ties. In June, Saudi Arabia pledged to invest billions in Egypt per an agreement. Yesterday, the Saudi sovereign wealth fund acquired minority stakes in some Egyptian state-owned firms. 

Know more: Saudi Arabia and Iraq also began interconnecting their electricity systems in June. 

Join hundreds of Middle East professionals with Al-Monitor PRO.

Business and policy professionals use PRO to monitor the regional economy and improve their reports, memos and presentations. Try it for free and cancel anytime.

Already a Member? Sign in


The Middle East's Best Newsletters

Join over 50,000 readers who access our journalists dedicated newsletters, covering the top political, security, business and tech issues across the region each week.
Delivered straight to your inbox.


What's included:
Our Expertise

Free newsletters available:

  • The Takeaway & Week in Review
  • Middle East Minute (AM)
  • Daily Briefing (PM)
  • Business & Tech Briefing
  • Security Briefing
  • Gulf Briefing
  • Israel Briefing
  • Palestine Briefing
  • Turkey Briefing
  • Iraq Briefing

Premium Membership

Join the Middle East's most notable experts for premium memos, trend reports, live video Q&A, and intimate in-person events, each detailing exclusive insights on business and geopolitical trends shaping the region.

$25.00 / month
billed annually

Become Member Start with 1-week free trial
What's included:
Our Expertise

Memos - premium analytical writing: actionable insights on markets and geopolitics.

Live Video Q&A - Hear from our top journalists and regional experts.

Special Events - Intimate in-person events with business & political VIPs.

Trend Reports - Deep dive analysis on market updates.

We also offer team plans. Please send an email to and we'll onboard your team.

Already a Member? Sign in