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Kuwait to transfer $2 billion aid to Egypt: Egypt central bank chief
September 11, 2013 / 7:54 PM / 4 years ago

Kuwait to transfer $2 billion aid to Egypt: Egypt central bank chief

People and vehicles are seen caught in a traffic jam in front of the Central Bank of Egypt's headquarters in downtown Cairo March 17, 2013. REUTERS/Amr Abdallah Dalsh

CAIRO, Sept 11 (Reuters - The Gulf Arab state of Kuwait will deposit $2 billion in aid in Egypt’s central bank next week, the Egyptian central bank governor said on Wednesday.

Hisham Ramez told the Al Arabiya television network the money would stay in the central bank for five years.

A political crisis that began when the army overthrew Islamist President Mohamed Mursi on July 3 has hammered Egypt’s economy.

In July, Kuwait pledged to provide $4 billion in aid to Egypt, matching pledges by Saudi Arabia and the United Arab Emirates that showed Gulf Arab approval of the Egyptian army’s ousting of Mursi.

Kuwait’s state news agency said the package would comprise a $2 billion central bank deposit, a $1 billion grant and $1 billion in oil products.

Kuwait has in the past cooperated with Riyadh and Abu Dhabi in offering financial aid for Gulf neighbors hit by social unrest such as Bahrain and Oman, and also for Morocco and Jordan. Gulf Arab states view Mursi’s Muslim Brotherhood with deep suspicion.

The aid from the three Gulf Arab oil producers is expected to help Egypt avoid a balance of payments crisis and overcome fuel shortages that partly caused a wave of public anger against Mursi.

It will also ease pressure on Cairo to conclude long-running talks with the International Monetary Fund on a $4.8 billion loan. But a surging fiscal gap will remain a pressing challenge for the Egyptian government, analysts say.

Reporting by Michael Georgy; editing by Andrew Roche

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