EU Announces $8 Billion Aid Package For Cash-Strapped Egypt

0
441

The European Union on Sunday announced a $8 billion aid package for cash-strapped Egypt as concerns mount that economic pressure and conflicts in neighbouring countries could drive more migrants to European shores.

The deal is scheduled to be signed during a visit Sunday by European Commission President Ursula von der Leyen and leaders of Belgium, Italy, Austria, Cyprus and Greece, according to Egyptian officials.

President Abdel Fattah el-Sissi of Egypt met separately with von der Leyen and Belgium Prime Minister Alexander De Croo, whose country holds the rotating EU presidency, ahead of the signing ceremony Sunday afternoon.

The package includes both grants and loans over the next three years for the Arab world’s most populous country, according to the European Union Mission in Cairo.

According to a document from the EU mission in Egypt, the two sides have promoted their cooperation to the level of a “strategic and comprehensive partnership,” paving the way for expanding Egypt-EU cooperation in various economic and non-economic areas.

El-Sissi’s office said in a statement that the deal aims to achieve “a significant leap in cooperation and coordination between the two sides and to achieve common interests.”

The EU will assist Egypt’s government in fortifying its borders, especially with Libya, a major transit point for migrants fleeing poverty and conflicts in Africa and the Middle East, and will support the government in hosting Sudanese who have fled nearly a year of fighting between rival generals in their country.

Egypt has for decades been a refuge for migrants from sub-Saharan Africa trying to escape war or poverty. For some, Egypt is a destination and a haven, the closest and easiest country for them to reach. For others, it is a point of transit before attempting the dangerous Mediterranean crossing to Europe.

The deal would inject much-needed funds into the Egyptian economy, which has been hit hard by years of government austerity, the coronavirus pandemic, the fallout from Russia’s full-scale invasion of Ukraine, and most recently, the Israel-Hamas war in Gaza.

Egypt reached a deal with the International Monetary Fund earlier this month to increase a bailout loan to $8 billion, up from $3 billion, after marathon negotiations.

The deal with the IMF was combined with economic reforms that included the flotation of the Egyptian pound and a sharp rise in the main interest rate.