Egypt has received a second payment of $14 billion from the UAE to develop the coastal city of Ras Al Hekma, the Egyptian cabinet said on Wednesday.
The allocation is the second tranche of the $35 billion deal signed in February with a consortium led by Abu Dhabi's investment holding firm ADQ.
Egypt has also initiated consultation with the Emirates over a $6 billion UAE deposit held in the Egyptian central bank, to convert its value into Egyptian pounds, Egyptian Prime Minister Mostafa Madbouly said.
The cabinet said in February that the UAE and the Egyptian central bank were working to convert UAE deposits worth $11 billion into Egyptian pounds.
In February, ADQ said it would acquire the development rights for Ras Al Hekma, a coastal region about 350km north-west of Cairo.
Spanning more than 170 million square metres, the development is expected to attract more foreign direct investment, boost trade, create new jobs and support Egypt’s private sector.
It will include hotels, yacht marinas, entertainment centres, as well as residential, commercial and recreational spaces with global connectivity.
The Egyptian government will retain a 35 per cent stake in the development and the work is expected to start next year.
It is expected to attract as much as $150 billion in investments, Mr Madbouly said in February.
The investment from the UAE is a key step towards establishing the location as a leading Mediterranean holiday destination, financial centre and free zone.
In the past few years, the UAE has intensified its investment in Egypt to help bolster the country's economy and capitalise on the investment potential.
In April 2021, ADQ acquired Egypt’s Amoun Pharmaceutical Company from Canada's Bausch Health for $470 million.
In December of the same year, ADQ opened an office in Cairo, and over the past few years has bought stakes in publicly-listed Egyptian companies across key sectors, from FinTech to logistics.
Egypt, the Arab world’s most populous nation is struggling with shortages of foreign currency and high inflation. The recent infusion of cash could help the country to ease currency pressures.
In March, Egypt also finalised a deal with the International Monetary Fund to receive $8 billion in loans.
It came after the Central Bank of Egypt increased interest rates and allowed the local currency to freely float with no interventions from the state.
The flotation, which was in discussions for months, was a key condition from the IMF to approve Egypt’s loan.
