Abdel Fattah al-Sisi and Xi Jinping
Egyptian President Abdel Fattah al-Sisi shakes hands with Chinese President Xi Jinping during a signing ceremony at the Great Hall of the People in Beijing, Dec. 23, 2014. Greg Baker/AFP/Getty Images

Egypt is borrowing $1 billion in a concessional loan from China to finance sanitation projects in the North African country’s Nile Delta region. Egyptian Minster of Housing Mostafa Madbouli signed a deal Monday with Juzoba, one of China’s largest construction companies, to build sanitation networks for 260 villages, according to the Middle East Monitor.

“$1 billion will be provided by a Chinese bank as a concessional loan for the implementation of this project,” Madbouli reportedly said in a statement. While the details of the deal were not immediately available, concessional loans typically include better rates and payment terms than market-rate loans.

Egyptian officials hope to eventually establish sanitation networks in 1,321 villages nationwide, which will cost a total of $3 billion. Around three quarters of Egyptian villages do not have sewage systems. In the villages that do have them, the systems are often blocked or aren’t working at all, according to data from the Central Agency for Public Mobilization and Statistics.

Chinese President Xi Jinping is scheduled to visit Egypt this month, which Egyptian officials said is an important step for expanding economic and political relations between the two countries. A number of agreements are expected to be signed during the visit for joint developmental projects in electricity, transportation, education, science and infrastructure. An Egyptian-Chinese business forum will also take place during Xi’s visit, as well as a fair for ultra-tech Chinese products, according to Egypt’s state-run news agency.

Egyptian-Chinese trade reached around $9.6 billion in September, a 13 percent increase from the previous year. Egyptian imports from China also increased in 2015 to $8.9 billion, while exports sold to China reached $936 million.

Egyptian President Abdel-Fattah al-Sisi attended Beijing’s military parade in September to mark the 70th anniversary of the end of World War II; Egypt was the only Arab and African country to participate in the event.

"Egypt is a major Arab, African and developing country. China has always been viewing and developing the China-Egypt relations from a strategic and long-term prospective," Chinese Ambassador to Egypt Song Aiguo said in September, according to China’s state-run Xinhua News Agency. "China-Egypt comprehensive strategic partnership will bear more and more fruits to benefit the two peoples.”