Yahoo Finance Egypt to Get UK Budget Support to Top Off $57 Billion Global Aid
(Bloomberg) -- Egypt expects to get $400 million in budget support from the UK over two years, the latest component of a vast global bailout for the North African country’s economy.
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The sum will come in tandem with budget financing from the World Bank that’s part of a previously announced $6 billion, three-year package, Egypt’s International Cooperation Minister Rania Al-Mashat said in an interview. Egypt hopes to receive the first tranches of $200 million from the UK and $500 million from the Washington-based bank by July, according to Mashat, followed by the same amounts the next fiscal year.
“Once Egypt’s parliament approves this financing, Egypt can get it,” Mashat said in the US capital, where she was attending the spring meetings of the International Monetary Fund and World Bank. She holds the role of governor for Egypt with the latter institution.
The pledge signals no let-up in foreign engagement with Egypt after it lined up $57 billion in funding from global institutions and regional allies to bolster an economy that had been mired in its worst crisis in decades.
Read More: Egypt Avoided an Economic Meltdown. What Next?: QuickTake
More than half the total is coming from an United Arab Emirates deal announced in February and billed as Egypt’s biggest-ever foreign investment. That pact allowed Cairo to enact a long-awaited currency flotation, in turn unlocking expansive new agreements with the IMF, European Union and others.
Mashat said her ministry has also approached the Beijing-based Asian Infrastructure Investment Bank for budget support and talks may begin soon. She didn’t give further details.
A debt-swap deal that Egypt signed with China in October is worth $100 million and allows the most populous Middle Eastern nation to use a portion of the debt it owes to implement development projects both countries agree on.
The minister also said:
Of the EU’s $7.8 billion pledge, $5 billion will be budget support
Half of the World Bank’s three-year, $6 billion financing will be directed to private-sector projects via the International Finance Corp.
Of the remainder, $1.5 billion will be for budget support and the same amount for government development projects
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