Egypt and Saudi Arabia signaled their intention to strengthen economic ties on Tuesday during a visit to Cairo by Saudi de facto ruler Crown Prince Mohammed bin Salman, announcing deals worth $7.7 billion.
Saudi Arabia has already provided billions in support since Egypt’s President Abdel Fattah al-Sisi came to power in 2014, and Cairo is struggling with the economic knock-on effects of the Ukraine war.
The stop in Egypt was the start of the first tour outside the Gulf region in over three years by the prince, widely known as MbS. He left on Tuesday evening for Jordan, and will later visit Turkey.
The prince and Sisi discussed trade, investment and security, as well as a regional summit in Saudi Arabia next month that will be attended by U.S. President Joe Biden, a statement from Egypt’s presidency said.
The 14 deals signed on Tuesday ranged from renewable energy to petroleum, food and fintech. They included a $1.5 billion agreement between Saudi Arabia’s Acwapower (2082.SE) and the Egyptian Electricity Holding Company to build a wind power plant, according to an Egyptian cabinet statement.
Among the other agreements was the development of the multi-purpose terminal at Egypt’s Damietta port, Egypt’s General Authority for Investment and Free Zones said in a statement, and the establishment of a $150 million “pharmaceutical city” by Egypt’s Pharco Pharmaceuticals in Saudi Arabia, the company’s chairman told Alsharq TV.
A joint statement said Saudi Arabia was resolved to lead investments in Egypt worth $30 billion, though it was unclear what the figure referred to.
Even before the Russian invasion of Ukraine in late February led to higher commodity prices, hit tourism revenues and prompted investors to exit emerging markets, there were concerns over Egypt’s current account and budget deficit, bankers said.
In March, Saudi Arabia deposited $5 billion in Egypt’s central bank. The Egyptian government had said previously that cooperation with the Saudi sovereign wealth fund would result in $10 billion in investments.
The Saudi-based Islamic Trade Finance Corporation (ITFC) has started disbursing $3 billion in new financing to help Egypt import commodities, its CEO said last week.
