Fresh financing is on its way from China: State-owned China Development Bank (CDB) announced that it gave the Central Bank of Egypt CNY 7 bn (c. USD 957 mn) on 30 October to, fulfilling a loan agreement signed last month during the Belt and Road Forum, according to a statement by the lender yesterday.

It’s all about cooperation and the Belt and Road initiative,says the Beijing-based lender. The fresh financing will go towards unspecified agreements from October’s Belt and Road Forum and nine already agreed upon projects from the Forum on China–Africa Cooperation held in 2021.

The CBD is no stranger to Egypt: The lender added that it has issued USD 6.5 bn worth in loans in Egypt in the first nine months of this year. This has gone towards supportings the CBE’s USD 1 bn credit line, local bank financing for MSMEs, electricity infrastructure projects, and projects in the TEDA industrial zone in Ain Sokhna. The bank is also trying to set up a branch in Egypt so Chinese companies can access CNY in Egypt to fund local investments.

Chinese companies have also become an important source of FX investment: At the recent Belt and Road Forum, private and state-owned enterprises in China have pledged investments worth c. USD 15.5 bn in the Suez Canal Economic Zone. Enterprise HQ has been inundated with big China investment stories throughout the year on at least a weekly basis, especially now we’re set to join BRICS in 2024.

DATA POINT- About 5% of our total external debt is owed to the Chinese: Egypt owed USD 8.2 bn to China as of the end of March, according to central bank figures (pdf). The country’s total external debt was USD 165.3 bn as of March 2023.

The international press also picked up the story: Reuters

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