Cairo – January 21, 2025: Cairo – January 21, 2025: Egypt has begun negotiations with the European Union (EU) for a €4 billion financing package (approximately EGP 208 billion) to strengthen the country’s budget as part of its ongoing structural reform agenda.
The deal is expected to be finalized by June, according to Rania Al Mashat, Minister of Planning, Economic Development, and International Cooperation.
In an interview with Asharq Business during her participation at the World Economic Forum in Davos, Al Mashat emphasized that the external borrowing will be directed toward budget support, not specific projects, during the current year.
This funding is part of a broader €5 billion support package from the EU, with €1 billion already received by the Egyptian government in December.
The package is within the framework of the national structural reform program which focuses on three main pillars: maintaining macroeconomic stability, fostering a supportive business environment, and stimulating the private sector, as well as facilitating the green transition.
Earlier this year, Egypt signed a strategic partnership with the EU that includes a financing plan totaling €7.4 billion in grants and loans to be provided by the EU through to the end of 2027.
The European Commission stated that this financial support would help Egypt meet part of its financing needs for the current fiscal year, ensure the stability of its macroeconomy, and support the country in implementing its reform agenda alongside the ongoing program with the International Monetary Fund (IMF).
In addition to this budgetary support, Egypt is also discussing a €1.8 billion guarantee mechanism with the EU aimed at supporting the private sector.
Al Mashat also revealed that for the first time, financing from international institutions for the private sector has exceeded the funds allocated to the Egyptian government, with private sector financing reaching $4.2 billion.
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