The Egyptian and UAE governments this week signed $4.9 billion USD worth of loan and aid agreements to finance development and infrastructure projects in Egypt, including water, sanitation and power projects.
“UAE aid has averted a lot of economic crises in Egypt,” Egyptian Prime Minister Hazem al Biblawi told a press conference in Abu Dhabi this week.
The funding package offered by the UAE is part of the aid that Gulf Cooperation Council (GCC) countries pledged to Egypt in July. Saudi Arabia and the United Arab Emirates in particular have expressed interest in funding major development projects in Egypt after the European Union and the United States indicated they might suspend aid to the conflict-torn country following the July 3 coup that removed former President Mohamed Morsi from power.
The EU last year pledged $6.7 billion USD in development aid for Egypt. The United States used to extend roughly $400 million USD annually, in addition to the more than $1 billion USD in military aid it provides. Most of these funds are suspended now pending progress toward democracy in Egypt.
Saudi Arabia, the United Arab Emirates and Kuwait have already pledged $12 billion USD to support the Egyptian state budget.
Egypt has been counting on foreign funding to implement major water and wastewater infrastructure projects. It was feared that the loss of EU and US aid might bring many of these projects to a halt, so the aid pledges by Arab countries have been critical for the interim government.
The Egyptian government last week rolled out a $3.2 billion USD plan to implement new development and infrastructure projects by the beginning of 2014. The projects include new drinking water treatment plants, wastewater treatment plants, sanitation facilities and pipeline networks, in addition to roads and railways.
This story is brought to readers free in association with Singapore International Water Week.