Egypt Secures US$ 200 Mln Loan From Chinese Development Bank

Tarek Amer, Chairman of The National Bank of Egypt (NBE), confirmed that Egypt signed an agreement with China Development Bank (CBD) over a US$200 million loan. Although negotiations over the loan started one year ago, papers were only signed amid bilateral talks held between the Egyptian president Mohamed Morsi and the Chinese president Hu Jintao. Both presidents signed six other agreements.

Abbas Shams, Head of International Loan Department at NBE, stated that the eight-year term loan will be used to finance infrastructure projects. The first repayment installment will be paid after three years. The loan will be repaid in half-yearly installments over five years. The interest rate of the loan is at the rate of 375 basis points above Libor.The loan will be used to finance infrastructure projects such as electricity, education, industry and communications projects.

The Egyptian president Mohamed Morsi and the Chinese president Hu Jintao signed a number of agreements and one of them stated that China will give Egypt a non-refundable grant of 450 million yuan to finance the establishment of joint ventures in infrastructure, electricity and environment-protection sectors.