DUBAI, Sept 19 (Askume) – Saudi Arabia plans to invest $5 billion in Egypt independent of Gulf states using funds deposited in the country’s central bank, Egyptian Prime Minister Mustafa Madbouly said on Thursday.
The country’s sovereign dollar bonds rose to a two-year high. Bonds maturing in 2059, the highest yielding ones, were up 1.35 cents on the dollar at 77.60 cents as of 1309 GMT, Tradeweb data showed.
Recently maturing bonds were priced as high as 99.52 cents.
“$5 billion will be invested in projects in key economic sectors that will be decided upon later by mutual consent,” Madbouly said.
Egyptian bonds were near or above the highest levels for early 2022 on Tuesday, a day after Egypt’s cabinet said for the first time that Saudi Crown Prince Mohammed bin Salman had approved a plan to finance the Saudi sovereign wealth fund (SWF) will invest US$5 billion in Egypt in a so-called “first phase.”
Banking data shows Saudi Arabia has $5.3 billion in medium and long-term deposits with Egypt’s Central Bank. It also pledged $5 billion in short-term deposits maturing in 2022, which is believed to have been scrapped.
Egypt is seeking massive investment as it attempts to recover from a prolonged economic crisis that has led to record inflation, rising debt loads and a sharp currency depreciation over the past two years.
The North African country got a boost earlier this year when itSigned the Ras Hekma Agreement with the United Arab Emirates to develop key fields along the Mediterranean coast and secured billions of dollars in financing from international lenders.
Cairo is currently earmarking five areas along the Red Sea coast for large-scale investment, including Egypt’s southernmost region30 kilometres (19 mi) off the Las Banas Peninsula , Saudi Arabia.
It is one of the few stretches of coastline in the North African country that has not yet been developed for tourism.
“We have identified five large areas along the Red Sea coast and our aim is to develop these areas as centres of development like the settlement of Ras Hekma,” he said.
