CAIRO, Egypt (AP) – Saudi Arabia offered a $5 billion aid package for cash-strapped Egypt on Wednesday, where the economy is under strain due in part to the economic consequences from Russia’s conflict on Ukraine.
The monies, which were placed in Egypt’s Central Bank, are part of Saudi Arabia’s “tireless efforts” to strengthen Egypt, the Arab World’s most populous country, according to the state-run Saudi Press Agency. The funds will be added to Egypt’s foreign reserves, which stood at roughly $41 billion at the end of February, and will help with vital imports as well as hold up the country’s tumbling currency.
The actions have taken a significant toll on Egyptians in the low and middle classes, who have seen price increases since the government launched an ambitious reform programme to repair the country’s shattered economy in 2016. The measures were agreed upon in exchange for a $12 billion bailout from the International Monetary Fund.
Economists believe the policy indicates that the administration is attempting to get another IMF finance package. The global lender stated that Egypt requested its assistance in “implementing their comprehensive economic policy,” but did not specify if the discussions involved a fresh loan.
The actions have taken a significant toll on poor and middle-class Egyptians, who have seen price increases since the government launched an ambitious reform programme to repair the country’s shattered economy in 2016. The measures were agreed upon with the International Monetary Fund in exchange for a $12 billion bailout.
Economists believe the move is a hint that the administration is attempting to get another IMF loan. The global lender stated that Egypt requested its assistance to “implement their comprehensive economic policy,” but did not specify if the discussions involved a fresh loan.
The defence is requesting that the Russian suspect in the downing of MH17 be acquitted. Saudi Arabia and the United Arab Emirates have poured billions of dollars into Egypt in recent years, bolstering its shattered economy.
Egypt’s economy is under new strain as a result of an inflationary wave caused by the coronavirus epidemic and Russia’s war in Ukraine, which has driven up oil prices to all-time highs.
The war has also had an impact on Egypt’s key tourist industry, as the majority of international visitors to Egypt’s Red Sea resorts have come from Russia and Ukraine. Egypt is also the world’s top importer of wheat, with the majority of its supplies coming from Russia and Ukraine.
The Egyptian government said on Tuesday that energy-rich Qatar will invest $5 billion in Egypt, the latest evidence of growing improvement in relations between the two countries since Egypt and three Gulf states settled a diplomatic crisis with Qatar last year.
