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IDB approves $425 mn loan to Egypt

Loans will help fund development of petroleum refinery and first phase of redevelopment work at Sharm El-Sheikh airport.
09.09.14 | Source: Ahram Online

The Islamic Development Bank (IDB) has revealed the repayment schedule for two loans to Egypt worth $425 million.

The loans are to be repaid at 1.05 percent above Libor in six-monthly installments after the completion of the project, Aboubakr Barry, the bank's director of finance, told Ahram Online on Monday.

The agreement is an ijarah contract that gives the bank a title to the property financed for 15 years after which the projects backing the loan would revert back to the government, added Barry.

The loans target the development of a petroleum refinery ($198 million) and the first phase in the development of Sharm El-Sheikh international airport ($226.8 million).

Finance Minister Hany Qadry said in a statement released Thursday that the ministry was guaranteeing the loan.

The government is seeking external debt to avoid crowding the private sector in domestic financial resources, added Qadry.