Egypt signed a loan agreement worth 45 million Kuwaiti dinars or $150 million with the Arab Fund for Economic and Social Development on Sunday, state news agency MENA reported.
The money will be used to fund an Egyptian sewage project in the province of Giza and the loan comes at a time when the cash-strapped Egyptian economy is in dire need of funding, especially since there is a need for new infrastructure to be built and for the renovation of already existing infrastructure.
The interest rate on the loan was reduced from 3 percent to 1 percent. The loan is scheduled to be paid back in 20 years and its conditions provide for a grace period of five years.
This loan brings the Kuwaiti-based Arab Fund for Economic and Social Development’s contribution to development projects in Egypt up to 1.3 Kuwaiti dinars, equivalent to $4.3 billion, according to MENA.
The deal was signed by Minister of International Cooperation Sahar Nasr, who is currently in Kuwait at the invitation of the Kuwait Fund for Arab Economic Development to discuss providing funding to develop the Sinai Peninsula.
Nasr held meetings with several development institutions and funds, and told MENA she agreed on loans worth $1 billion to fund development projects in Sinai. The minister said Sinai needs $1.5 billion for development and that Arabic funds have expressed their willingness to support Egypt.
The Egyptian economy is grasping at every chance to collect financial assistance before the end of the year.
On Thursday, the international cooperation ministry and the African Development Bank signed an agreement to provide Egypt a soft loan of $500 million. The loan is part of a comprehensive programme for economic development to support Egypt’s general budget with a total of $ 1.5 billion over three years.
On Friday, the World Bank approved a loan worth $3 billion to Egypt, to be paid out on $1 billion payments over three years.
Last week, Saudi Arabia said it is going to raise its investments in Egypt to above 30 billion Saudi riyals ($8 billion) and will "contribute to providing Egypt with petroleum needs for the next five years."
Years of political turmoil have taken a toll on the Egyptian economy, halving the state’s foreign reserves and driving away tourists, which has contributed to a dollar shortage.
