FOREIGN AID PACKAGES BOOST EGYPT'S PROSPECTS
By Gordon Platt
Financial aid packages from the US, China, Saudi Arabia and Qatar, among others, will provide much-needed support for the Egyptian economy at a time when the country's FX reserves have fallen sharply . Egypt has also requested $4.8 billion in low-interest loans from the International Monetary Fund.
A high-level delegation of US business leaders, led by G. Steven Farris, chairman of the US-Egypt Business Council and CEO of oil producer Apache, visited Egypt in September. Bechtel, Boeing, Cargill, Caterpillar, Exxon Mobil, General Electric and Google were among about 50 companies represented. Meanwhile, the US was nearing a $1 billion debt-forgiveness agreement with Egypt, which also receives $1.3 billion annually in US military aid.
China Development Bank granted a $200 million loan when Egyptian president Mohamed Morsi visited China in late August on one of his first overseas trips since being elected. Egypt hopes that China will increase its direct investment to around $3 billion in the next two years.
Abu Dhabi began commercial operations in September at its new $7.2 billion Khalifa Port, which will be the main container terminal serving the UAE capital city. The port could handle 15 million containers annually by 2030.
Saudi Arabia has continued to produce crude oil at a record pace of nearly 10 million BPD this summer. "We had earlier assumed that the return of Libya to full production in 2012 would see Saudi output fall back; however, the imposition of EU sanctions on Iran means that Saudi Arabia has had to keep production high," according to economists at Samba Financial Group in Riyadh.