Of the Gulf Cooperation Council (GCC) member-states, the UAE stands out for being a major contributor to enhancing the Egyptian economy. By one account, the UAE has extended financial assistance in excess of $14 billion (Dh51.4 billion) over the past two years.
Certainly, this is a sizeable contribution to the Egyptian economy, which has a gross domestic product of $300 billion. Egypt has the third largest Arab economy after Saudi Arabia and the UAE.
The UAE’s assistance in the well-being of Egypt’s economy was on display all through the “Egypt: The Future” summit held at Sharm Al Shaikh. Four GCC countries committed $12.5 billion of aid to Egypt, split between the $4 billion apiece from the UAE, Saudi Arabia and Kuwait and $500 million from Oman.
Oman aid package includes a grant of $250 million, with the balance set aside for investments into various economic projects over the course of five years.
Undoubtedly, this is an assistance on a quite astonishing scale, as Oman exerts efforts to overcome its own economic challenges caused by drop of oil prices in recent months. As a consequence, Standard & Poor’s Rating Services lowered foreign and local currency sovereign credit rating for the Sultanate from A/A-1 to A-/A-2.
Kuwait intends to direct its entire share to investments schemes in different sectors, while Saudi Arabia plans to put in $1 billion as deposit at Egypt’s central bank and $3 billion into development aid. The UAE opted to place $2 billion in the form of deposits with the central bank, clearly to boost the country’s financial position, and the balance into yet-to-be announced initiatives.
Commitments shown by the UAE during the Sharm Al Shaikh event extend beyond the announced financial support. The UAE is a partner in the development of two new cities in the country — Abu-Dhabi based Aabar clinched a memorandum of understanding to build a new city near Cairo. The new city is projected to cost $20 billion with completion over a span of 15 years.
Capital City Partners Ltd, a private real estate investment fund, cofounded by businessman Mohammad Alabbar of the UAE, will be developing a new administrative capital. The new city, yet to be named but dubbed as Capital Cairo, is projected to cost around $45 billion plus, certainly a prohibitive amount.
Details of the ambitious project suggest that it would be located east of Cairo, near the Red Sea, ostensibly to take advantage of shipping trade. Upon completion, the size of the new city would be approximately 700 square kilometres, similar to Singapore and Bahrain.
In addition, the new town would house governmental buildings, diplomatic missions and residential units. Other details entail 2,000 schools and colleges and 600 health care centres. Above all and of particular importance to the Egyptian economy, the new city will be creating more than one million jobs.
The UAE’s sustained commitment towards development of the Egyptian economy can be seen in the setting up of Nile Air, a private airline owned by a Saudi business concern. Plans for the airliner were unveiled during Dubai Air Show 2007 though operations commenced in 2010.
Not surprisingly, GCC states feel the obligation to help Egypt overcome its economic challenges, a vivid example of the noble notion of a friend in need is a friend indeed.
The writer is a Member of Parliament in Bahrain.
Source: Gulf News