Egypt likely needs over $10bn in aid

Egypt is likely to need more than $10bn in external financing to help it get its economy on track, a senior EU official said yesterday. The official said the European Union and other institutions and countries were considering financial support for Egypt in addition to a $4.8bn loan which Cairo has requested from the International Monetary Fund (IMF). “...Egypt will need more than this almost $5bn, probably Egypt will need more than double this amount, more than $10bn,” the official told a briefing ahead of a visit to Brussels by Egyptian President Mohamed Mursi today. The EU will “reinforce” the IMF package with aid of its own for Egypt, but was still considering how much support it would provide, the official said. Egypt, which needs help to stave off a balance of payments crisis and rebuild confidence among investors who fled during 18 months of political turmoil, hopes to reach a deal with the IMF by the end off the year, officials in Cairo have said. Mursi, on his first visit to Europe since he became Egypt’s first freely elected president in June, will meet European Commission President Jose Manuel Barroso, foreign policy chief Catherine Ashton and Herman van Rompuy, president of the council of EU governments. The talks in Brussels are expected to cover economic support, job creation, agriculture, energy and European investment in Egypt, the official said. The Egyptians are focusing on developing the country’s gas industry and renewable energy. Trade will be on the agenda but the European Union is not yet ready to open talks with Egypt on a free trade agreement, the official said. Egypt’s future is important for the 27-member bloc, which sees the development of Arab Spring countries as an economic opportunity, but also fears the possibility of anti-European governments on the other side of the Mediterranean. Last year, the European Union introduced a “more for more” policy under which it links economic aid to progress in civil rights and democracy. From gulf times.