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Egypt to receive 2nd tranche of ADB loan by end of 2016
Egypt will receive the second tranche of a loan from the African Development Bank (ADB) by the end of the year, stated Layla el-Mokaddem, representative of the ADB in Egypt.
The 2nd tranche is worth $500 million and is meant to support Egypt’s economic reform program.
Egypt says it will start talks on $2 bln loan from China next week
(REUTERS): Egypt will start talks with China over a $2 billion loan next week and plans to issue international bonds in October or November, Deputy Finance Minister for Treasury Mohamed Meait said on Monday.
The Egyptian government approved the potential sale of $3 billion to $5 billion of international bonds in August and engaged JPMorgan, Citi, BNP Paribas, and Natixis to act as lead managers.
Deputy Finance Minister Ahmed Kojak said earlier Egypt was in talks with China over a loan but gave no further details.
“All the details are with the central bank,” he said.
International Cooperation Minister Sahar Nasr meanwhile told the state news agency on Monday that Egypt is in talks with China over a loan of $4 billion. Of that, $1 billion would be used to support foreign reserves, with $3 billion allocated for developmental projects, Nasr said.
Egypt has reached a preliminary agreement with the International Monetary Fund over a $12 billion loan programme but must secure another $5 billion-$6 billion in bilateral financing to secure the IMF board’s approval.
An IMF official said last week that the Fund had held “very productive discussions” with authorities in China and Saudi Arabia about their contributing to that bilateral financing.
Asked about a potential loan deal, China’s Foreign Ministry said on Tuesday that the two sides were in talks on a currency swap, but did not elaborate.
“China and Egypt’s central banks are in discussions about a local currency swap and have made some initial progress. But they have not decided on the specific scale of the swap,” ministry spokesman Lu Kang told reporters at a regular briefing.
It is unclear if the currency swap talks were related to talks on loans. China’s central bank did not immediately respond to a Reuters question on the matter.
Egypt has struggled to revive its economy since a popular uprising in 2011 that toppled autocrat Hosni Mubarak but drove away tourists and foreign investors, the country’s major sources of foreign currency.
Reserves have tumbled from $36 billion in 2011 to around $16.56 billion at the end of August, equivalent to just over three months’ worth of imports.
EGX sees collective rise in mid-session
The Egyptian stock exchange has continued its rise during the mid-session Tuesday, powered by Arab purchases, while Egyptians and foreigners were mostly selling.
EGX30 rose by 0.92 percent; EGX50 rose by 0.68 percent EGX20 jumped by 1.223 percent; EGX70 increased by 0.19 percent and EGX100 rose by 0.39 percent.
Regional powers back studies on impact of Ethiopia’s Nile dam
Egypt, Sudan and Ethiopia commissioned studies into the environmental and economic impact of a $4 billion dam on the Nile that Addis Ababa aims to make the centerpiece of its bid to become Africa’s biggest power exporter.
The 6,000-megawatt Grand Renaissance Dam, situated close to Ethiopia’s border with Sudan and being built by Italy’s largest construction firm Salini Impregilo SpA, is due for completion next year.
It has become a bone of contention between Ethiopia and Egypt, downstream from the dam and relying almost exclusively on the Nile for agricultural, industrial and domestic water use.
Addis Ababa has complained Cairo has pressured international donors and lenders to withhold funding for the project, while Egypt has sought assurances the dam will not significantly cut the flow of water to its rapidly growing population.
Egyptian state news agency MENA said the two countries plus Sudan signed contracts on Tuesday tasking two French firms, BRL and Artelia, with conducting studies into the dam’s impact.
Gilles Rocquelain, BRL Director General, said the studies would start in late 2016 and take 11 months.
The leaders of the three countries signed a co-operation deal in Khartoum last year to pave the way for a joint approach to regional water supplies.
In all, Ethiopia plans to spend some $12 billion on harnessing its rivers for hydro power production in the next two decades.