By Doaa Farid
UAE crown prince and deputy supreme commander of the armed forces Mohammed bin Zayed Al-Nahyan has pledged to send $2bn in additional aid to Egypt in the form of deposits and grants, state-owned Al-Ahram reported on Monday.
Al-Ahram attributed anonymous sources in the cabinet saying that the crown prince of Abu Dhabi had promised to “support Egypt in several fields through making new investments in the domestic market.”
Al-Nahyan met with Defence Minister Abdel Fatah Al-Sisi on Monday to discuss ways of strengthening the economic, political and security ties between Egypt and UAE, with the former confirming his country’s support for Egypt’s interim government and praising the Egyptian military’s “national role” in handling the current crisis, according to a statement released by the spokesman for the armed forces.
The UAE was among the first Gulf countries to congratulate Egypt in the wake of removing former president Mohamed Morsi after the nationwide protests of 30 June.
Following the Morsi’s ouster, the UAE, along with other Gulf countries, announced new financial aid packages to Egypt, including $5bn from Saudi Arabia, $3bn from the United Arab Emirates and $4bn from Kuwait, in form of cash grants, deposits and petroleum products.
The UAE’s aid to Egypt comprised a $1bn grant and a $2bn interest-free deposit in the central bank. It also sent seven shipments of fuel worth $225m in July.
The influx of Gulf funds has bolstered the local currency and pushed foreign reserves to the highest levels since November 2011, announced by the Central Bank of Egypt announced in August to have increased by $4bn over the last month to $18.9bn.
In an interview on state TV on July, Prime Minister Hazem El-Beblawi revealed that Gulf countries would be open to offering additional aid when Egypt achieves greater stability.
Gulf aid will enable the government to reduce the 14% budget deficit at the end of this year, Minister of Finance Ahmed Galal stated earlier in August. However, it will not compensate the $4.8bn International Monetary Fund loan under negotiation because “the IMF aims to raise Egypt’s credit rating, which has been downgraded eight times in two years,” said Ashraf El-Araby, the Minister of Planning last Thursday in a press conference.