In a move to bolster Egypt’s economic stability, the European Union (EU) pledged €1 billion ($1.07 billion) in short-term financial aid on Friday. This aid comes as Egypt grapples with an ongoing economic crisis and foreign currency shortages.
This €1 billion tranche is part of the EU’s larger €5 billion loan package. An additional €4 billion in long-term assistance for the 2024-2027 period is still awaiting approval by the EU’s member states.
The EU’s financial support aims to address Egypt’s worsening fiscal situation, particularly in the wake of regional conflicts like the Gaza war and Houthi attacks in the Red Sea, along with the global repercussions of the war in Ukraine.
However, the EU attached a condition to the loan. Egypt must demonstrate “concrete and credible steps towards respecting effective democratic mechanisms, including a multi-party parliamentary system, the rule of law, and ensuring respect for human rights,” according to the official statement.
This announcement comes a month after Egypt secured an expanded $8 billion support program from the International Monetary Fund (IMF). The EU’s financial aid package signifies a strengthening of the partnership between the two regions.
