Egypt signs deal worth $1.5 billion with Saudi fund for Sinai development

Sunday 20-03-2016 08:58 PM

President Abdel Fattah al-Sisi with Saudi King Salman Bin Abdel Aziz on May 2, 2015. Presidency Handout

CAIRO, Mar 20 (Aswat Masriya) – Egypt signed an agreement worth $1.5 billion with the Saudi Fund for Development (SFD) to finance development in Sinai on Sunday, Egypt's ministry of international cooperation said.

The development plan for Sinai includes a number of projects that will be implemented by the armed forces in both North and South Sinai, the ministry said in a statement.

North Sinai is at the centre of militancy that has gripped Egypt since July 2013, with the latest attack taking place in its capital al-Arish yesterday, claiming the lives of 15 policemen.

The Egyptian agreement with SFD entails supplying Egypt with its needs of petroleum derivatives for the next 5 years.

Egypt's ministry of investment also signed a memorandum of understanding with the Saudi public investment fund today.

The agreements were signed on the sidelines of the fifth meeting of the Egyptian-Saudi Coordination Council held in Riyadh.

Saudi Arabia and Gulf neighbours Kuwait and the United Arab Emirates have backed Egypt since the military ouster of former president Mohammed Mursi in July 2013 following mass protests against his rule.

Last December, Saudi Arabia said it will raise its investments in Egypt to above 30 billion Saudi riyals ($8 billion) and pledged to contribute to providing Egypt with petroleum needs for the next five years. The Saudi decision came one day after Saudi Arabia launched an "Islamic alliance" to fight terrorism, made up of 34 countries including Egypt.

The kingdom has been generous with Egypt, a net importer of energy, since mid-2013 but the financial assistance now comes at a time when Egypt’s cash-strapped economy is in dire need.

Years of political turmoil have taken a toll on the Egyptian economy, halving the state’s foreign reserves and driving away tourists, contributing to a dollar shortage.

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