UAE allocates $4bn in assistance to Egypt
ABU DHABI // The UAE announced the allocation of US$4 billion (Dh14.7bn) to Egypt on Friday as Sheikh Mohammed bin Zayed, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the Armed Forces, wrapped up a visit to Cairo.
Half of the sum would be an investment and half a central bank deposit to support cash reserves, the UAE state news agency Wam said.
Sheikh Mohammed said the aid, authorised by President Sheikh Khalifa, showed the UAE was firm in its support for Egypt.
The money was aimed at promoting development in Egypt, which has a “pivotal role” in the region, Wam quoted Sheikh Mohammed as saying.
Sheikh Mohammed flew to Egypt on Thursday after attending GCC summits in Riyadh with US president Barack Obama and King Mohammed VI of Morocco, to discuss cooperation with Egypt on regional security threats and counterterrorism as well as economic support for the regional ally.
The Crown Prince and Egyptian president Abdel Fattah El Sisi discussed “security challenges that aimed to destabilise the region, violence and extremism as well as acts of terrorist groups”, Wam said.
“They stressed the importance of concerted efforts, cooperation and solidarity against the threats of foreign interference that aim at undermining the foundations of stability and security in the Arab region, and the need for a strong and effective platforms for joint Arab action that will confront the sources of threat and eliminate the dangers of extremism and terrorism in the region,” it said.
The report implied that both ISIL and Iran were topics of discussion.
Sheikh Mohammed’s visit followed a trip to Cairo earlier this month by Saudi Arabia’s King Salman that was widely seen as an attempt, in part, to put to rest reports of ongoing tension between Cairo and its Gulf Arab supporters.
The UAE, Saudi Arabia and Kuwait have spent billions of dollars supporting Mr El Sisi’s government after the former military commander removed the Muslim Brotherhood-backed president Mohammed Morsi in 2013 in the wake of large popular protests against his rule.
While there may have been adjustments to the terms of the Gulf’s financial aid – Reuters reported this month that Saudi aid would now come in the form of return-bearing loans – the visits by the Gulf leaders demonstrate that the mutual interests outweigh concerns.
Egypt, the largest Arab country, is a key member of the 34-nation military coalition led by Riyadh that carried out large exercises last month. The drills were ostensibly aimed at fighting extremists such as ISIL, but were also a show of strength aimed by Saudi at Iran. Cairo also backed a communique issued during the recent Organisation of Islamic Cooperation summit that condemned Tehran’s “interference in the internal affairs” of a number of regional countries.
Egypt’s economy relies heavily on its tourism industry which has been decimated by political turmoil since 2011 and more recently, terrorist attacks including the bombing of a Russian jetliner that had taken off from Sharm El Sheikh.
The Red Sea resort was the venue of an investor conference in March last year where the UAE, Kuwait and Saudi Arabia each offered Egypt $4bn. Sheikh Mohammed bin Rashid, the Prime Minister and Ruler of Dubai, said at the time that his country’s investment would included a $2bn deposit in Egypt’s Central Bank, with the rest used to fund projects to be announced later.
Egypt has struggled to spur economic growth since its 2011 uprising ushered in political instability that scared off tourists and foreign investors, key sources of foreign currency. Earlier this month, Cairo and Riyadh signed a pact to set up a 60-billion Saudi riyal (Dh58.7bn) investment fund.
The UAE has taken a hands-on role in helping Egypt reform its economy and has helped launch joint state-backed development projects.
“President El Sisi reviewed the roadmap and the most important and vital development projects achieved so far across Egypt, referring to the government’s efforts to attract investments and projects that will develop the national economy,” Wam reported “He welcomed UAE investors in Egypt … [and] appreciated the position of the UAE in support of Egypt through its contributions to the development in Egypt.”
Cairo has been badly stretched battling ISIL-allied insurgents in the Sinai as well as along its border with Libya, and counter-terrorism cooperation was also a key element of the discussions.
* With reporting from Reuters
Updated: April 23, 2016 04:00 AM