Egypt plans to draw €2bln ($2.19bln) euros from the EU to fund new industrial projects this year, a government official told Al Arabiya Business.
The country hopes to increase its exports to the EU by 10% by the end of 2024 and reach €12.5bln ($13.7bln) worth of trade, up from €11.5bln ($12.6bln) the year before.
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Investments from the EU contribute 32% of total FDI inflows in Egypt. However, the government wants to further strengthen ties with both the public and private sectors.
Investment commitments
The comments come after a series of investment pledges in the past year have made confidence in Egypt’s FDI sector grow.
Earlier in the year, BP agreed to invest $1.5bln in gas and drilling in Egypt after forming a joint venture with UAE-based Abu Dhabi National Oil Co.
Egyptian group GV Investments signed a partnership with a Chinese car manufacturer to produce one of its low-cost models for the Egyptian market.
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By GlobalDataIn June, Egypt’s sovereign wealth fund signed four agreements valued at $35.4bln with European companies to produce green ammonia as the country seeks to become a player in the renewable energy market.
European aid in exchange for easing migration
At the EU-Egypt Investment Conference in late June, the governments signed a memorandum of understanding (MoU) for the disbursement of €1bln ($1.09bln) in macro-financial assistance to Egypt. The aid is meant to boost the private sector.
At the conference, Ursula von der Leyen, the president of the European Commission, remarked her hopes for the country: “We deliver strategic investments that will help make Egypt a clean energy hub at the centre of the Mediterranean crossroads. And we deliver for Egypt’s youth, with a new skills programme so they succeed in the economy of the future. And this is just the beginning.”
However, the deal is not a simple economic agreement. The short-term aid is also geared towards curbing irregular migration. Similar deals have been made with Tunisia, Mauritania and Turkey.
The move has been criticized by NGOs as “another EU ‘cash for migrant control’ deal.”
Still, Egypt is focused on raising FDI inflows to bolster its private sector and boost its economy.
