Egypt, UAE ink massive USD 150 billion investment agreement

MENA

Published: 2024-02-23 17:56

Last Updated: 2024-04-17 19:32


Egypt, UAE ink massive USD 150 billion investment agreement
Egypt, UAE ink massive USD 150 billion investment agreement

Egypt inked a monumental investment partnership agreement with the United Arab Emirates (UAE) on Friday, aimed at the development of Ras El-Hikma city, situated west of Alexandria, marking one of the most significant agreements in recent times.

Prime Minister Mostafa Madbouly disclosed that the project's estimated cost stands at USD 150 billion, as reported by Reuters.

Notably, Madbouly highlighted that Egypt would secure 35 percent of the project's profits. Preceding the announcement, Egyptian sovereign bonds denominated in dollars experienced a surge on Friday.

Data from Tradeweb illustrated that the 2050 dollar-denominated bonds witnessed substantial gains, soaring by more than two cents to achieve their highest level in a year.

The Egyptian Cabinet, in a statement issued on Thursday, declared its approval of the "largest direct investment deal," forged through a partnership with significant entities. This agreement aligns with ongoing state endeavors to attract direct foreign investment and bolster the nation's foreign currency reserves, as elucidated by the Cabinet Presidency's statement.

Madbouly underscored that the deal aligns with "the state's development objectives, as delineated in the national strategic urban development plan," portraying it as the inception of numerous investment agreements aimed at augmenting Egypt's foreign currency reserves.

He emphasized that projects stemming from this pact would create hundreds of thousands of employment opportunities, fuel economic rejuvenation, and facilitate the engagement of various Egyptian companies and factories, thereby offering manifold benefits to Egypt.

Additionally, he highlighted ongoing efforts to finalize an agreement with the International Monetary Fund, alongside continued implementation of measures outlined in the state's royal policy document to empower the private sector and enhance its involvement in developmental sectors.

Earlier this month, Hossam Heiba, CEO of the General Authority for Investment, disclosed Egypt's selection of a UAE-based investment group from multiple offers to execute a project in Ras El-Hikma, located 200 kilometers west of Alexandria, in an upscale resort area.

Egypt grapples with a chronic foreign currency shortage, resulting in sustained pressure on the Egyptian pound, government expenditure, and local enterprises. Record-breaking inflation levels were recorded last summer, while the debt burden continues to mount. Furthermore, the shortage of foreign currency exacerbates due to diminished revenues from the Suez Canal following Houthi assaults on shipping in the Red Sea.

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