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Qatar has agreed to buy bonds from cash-strapped Egypt worth $3bn over and above a previously announced aid package, HE the Prime Minister and Foreign Minister Sheikh Hamad bin Jassim bin Jabor al-Thani said yesterday.
The announcement comes as Cairo holds difficult talks with the International Monetary Fund (IMF) over a loan of $4.8bn as part of a financing programme to lift Egypt’s economy out of crisis.
“We have agreed to add Egypt government bonds worth $3bn,” HE Sheikh Hamad bin Jassim said at a press conference in Doha with visiting Egyptian counterpart Hisham Kandil.
Qatar might also cover Egypt’s deficit of gas, mainly during summer time, Sheikh Hamad bin Jassim said, adding that it could also “cover Egypt’s exports of gas” as Egypt keeps its production for local consumption.
The most populous Arab nation is cutting its exports of natural gas as local demand for energy continues to grow, depriving the economy of badly-needed foreign revenues.
Qatar has already announced an aid package of $5bn to Egypt, comprising an outright grant of $1bn and $4bn in bank deposits.
An IMF delegation is visiting Cairo for talks on the financing programme and is expected to examine Egypt’s efforts at economic reform.
The government has been walking a tightrope as the reforms required by the international lender are likely to spark social tensions.
The size of the loan may change, IMF officials have said, without elaborating.
Egypt’s authorities believe the loan will help restore investor confidence in the country, where unrest that accompanied the 2011 uprising that toppled president Hosni Mubarak has caused a significant drop in revenue from the once-lucrative tourism industry.
Foreign reserves have plunged from $36bn to some $13bn in two years, and the budget deficit is increasing.
Qatar also wants to “participate in all projects tabled by the government of Egypt,” said Sheikh Hamad bin Jassim, adding that he discussed several projects with Kandil.
Kandil hailed Qatari investments in Egypt, but insisted that those represent about 18 to 20% of foreign investments, and are “not as big as rumoured to be”.
“We are not asking for a special status in Egypt... in return for support,” said Sheikh Hamad bin Jassim, insisting that Doha “will not be affected” by campaigns against it in Egyptian media.
“Sadly, media are reporting positive things negatively. But this will not affect Qatar’s way of dealing with our brothers in Egypt,” he said.
Kandil, on his Facebook page, dismissed media reports that relations with Doha were strained over a series of tax and regulatory issues affecting Qatari banks seeking to acquire assets in Egypt.
Kandil left Doha yesterday evening.
The Egyptian premier and his accompanying delegation were seen off by HE the Minister of Culture, Arts and Heritage Dr Hamad bin Abdulaziz al-Kuwari, Qatar’s Ambassador to Egypt, Saif bin Muqaddam al-Buainein, the chief of the Prime Minister’s Protocol, HE Ahmed Jassim al-Mulla, and Egyptian Ambassador, Mohamed Morsy Awad.
