Egypt seeks help with $7bn deficit

Egypt hopes to receive assistance from other Arab states and the Arab Monetary Fund to help it meet its immediate financing requirements of about US$7 billion (Dh25.7bn).

Hazem El Beblawi, the finance minister, said the country needed to plug a budget deficit of about 9 per cent of GDP. He was speaking on the sidelines of an Arab finance ministers meeting in Abu Dhabi yesterday.

"There's an understanding of our needs and the international and regional financial institutions are ready to help and the Arab brothers have good intentions," he said.

The country's economy has been reeling since a popular uprising erupted earlier this year. Egypt's foreign reserves have since dwindled and tourism and other investment has not recovered.

"We need stability to return, which will provide reassurance to investors and help get things back to normal," he said.

Egypt has already received multibillion-dollar pledges of financial support from the UAE, Saudi Arabia and Qatar.

Mr El Beblawi said Egypt was also applying to the Arab Monetary Fund (AMF) for assistance. The AMF is expected to lend $500 million to Egypt and Tunisia to help rebuild their economies, Jassim Al Mannai, the director general of the fund, said in July.

For the time being, the country intends to finance its budget deficit for the current fiscal year by selling 120bn Egyptian pounds (Dh73.74bn) in domestic treasury bills, he said.

Foreign investors sold off 34.9bn pounds of Egyptian holdings in the first six months of the year to 24.5bn pounds, Central Bank data shows.