Aletho News

EU joins IMF, Gulf states funneling billions into Egypt as Gaza refugee crisis looms

The Cradle | March 14, 2024

The EU is preparing a €7.4 billion ($8 billion) aid package for Egypt, citing “concerns” that the Israeli genocide in Gaza and the ballooning crisis in Sudan could “risk exacerbating financial troubles in the North African nation and raising immigration pressure on Europe,” according to a report by the Financial Times (FT).

European Commission president Ursula von der Leyen is set to visit Cairo on 17 March alongside the Greek, Italian, and Belgian prime ministers to “finalize and announce the agreement.”

Completion of the deal accelerated following the start of Israel’s campaign of genocide in the Gaza Strip. The terms of the agreement reportedly include support for Egypt’s energy sector, assistance to deal with the rising number of refugees entering the country, and help to fortify the country’s border with Libya.

An estimated €1bn in emergency financial assistance could be paid immediately to Cairo, while another €4 billion in “macro-financial assistance” hinges on implementing reforms under an expanded loan program with the International Monetary Fund (IMF). Officials told FT the rest of the funds would be drawn from various EU funding streams.

The funds from Brussels is the latest in a recent string of investment packages coming from the west and Gulf states for cash-strapped Egypt.

“With respect to the question on the potential impact pressures from refugees from Gaza, what we do see in Egypt is that there is a need to have a very comprehensive support package for Egypt. And we’re working … to ensure that Egypt does not have any residual financing needs,” IMF spokesperson Julie Kozack said on 22 February.

The IMF agreed just days later to expand its financial rescue program for Egypt to $8 billion after the Egyptian central bank let loose its currency to help stabilize the economy. Egypt is the second most indebted country to the IMF, behind only Argentina, with an international debt that grew from $37 billion in 2010 to $164 billion in 2023.

In late February, UK oil giant BP announced plans to develop gas projects and drilling in Egypt over the next three to four years at a cost of $1.5 billion. This came just after the North African nation sealed a massive $35 billion real estate development deal with the UAE, which will see Emirati investment vehicle ADQ build a 170 km tourism and financial center in the Ras al-Hekma area.

In recent weeks, Cairo has also been in discussions to sell prime Red Sea coastal land near Sharm al-Sheikh to Saudi investors.

The unprecedented windfall comes as Egypt is putting the finishing touches on a kilometers-wide buffer zone and wall along its border with southern Gaza, allegedly in preparation to take in hundreds of thousands of displaced Palestinians once the Israeli ground invasion of Gaza’s southernmost city begins.

Amnesty International and other NGOs have also accused Cairo of “harassing” the director of the UK-based Sinai Foundation for Human Rights, which revealed the construction of the buffer zone last month.

Geopolitical analysts, including The Cradle’s Mohamad Hassan Sweidan, have speculated that Egypt may be willing to accept refugees from Gaza in exchange for a significant offset of its staggering debt.

March 14, 2024 - Posted by aletho | Ethnic Cleansing, Racism, Zionism | Egypt, European Union, Israel, Palestine, Saudi Arabia, UAE, Zionism