Qatar Lifts Egypt Assistance By $2.5 Billion, Hegazi Says

Qatar will increase its assistance to Egypt by buying $2.5 billion of government bonds to help shore up its economy after the 2011 revolution, Egyptian Finance Minister El-Morsi Hegazi said.

Egypt’s Cabinet will discuss the debt offering and the company that will handle it next week, Hegazi said in an interview in Cairo yesterday. The gas-rich Persian Gulf emirate has already provided $5 billion of grants and central bank deposits to Egypt, and will continue to stand alongside the nation, Qatari Prime Minister Sheikh Hamad bin Jassim al-Thani told reporters Jan. 15 in the capital Doha.

Qatar’s assistance has given the Arab world’s most populous country a financial cushion as it seeks a $4.8 billion loan from the International Monetary Fund. Egypt’s foreign reserves remain almost 60 percent below their levels before the uprising that ousted former leader Hosni Mubarak from power. President Mohamed Mursi’s government is seeking aid to bolster the economy as protesters take to the streets over his leadership.

“Basically they are recognizing that Egypt is a very important country in the region,” Steffen Reichold, an emerging markets economist at Stone Harbor Investment Partners LP in New York, said by phone. “Qatar is very much interested in keeping things as stable as possible and using some of their large resources to contribute to that.”

Bloomberg