Kuwait could invest USD 4 bn held in Egypt: Kuwait is in talks to turn the USD 4 bn of deposits it holds in Egypt’s central bank into direct investments across several sectors, Bloomberg reported on Thursday, citing unnamed sources it said are familiar with the matter.

Not the first time we hear of this: In October, unnamed sources told Al Mal that the country’s sovereign wealth fund, Kuwait Investment Authority (KIA), is considering converting its deposits in the Central Bank of Egypt (CBE) into direct investments in both public and private sector companies.

The timeline: The Gulf country is aiming to move forward with its plan soon, with a target of investing at least USD 2 bn by the end of the year, but no final decision on the timeline has been reached yet, according to Bloomberg.

That’s not all: Ekuity Holding, which manages KIA’s investments in Egypt, is reportedly looking to invest an undisclosed amount in Egypt in addition to the USD 4 bn deposits, sources told the business news service, without providing further details.

IN CONTEXT- The Kuwaiti-Egyptian Cooperation Council and Investment and Business Forum, which took place last Wednesday, highlighted 52 new investment prospects for Kuwaiti investors, including participation in the state privatization program and projects in the automotive, chemicals, and textile sectors, Al Arabiya reported on Wednesday. The Kuwaiti delegation expressed interest in scaling up investments in Egypt and playing an active role in the upcoming Egypt-Gulf Investment Forum, which is set to be hosted in Cairo later this year, according to an Ittihadiya readout following the delegation’s meeting with President Abdel Fattah El Sisi.

Which sectors are the Kuwaitis eyeing? The Kuwaiti private sector is aiming to funnel investments into Egypt’s real estate, tourism, pharma, and automotive sectors, head of the Kuwaiti side of the Egyptian-Kuwaiti Cooperation Council Mohammed Al Saqr told Al Arabiya, adding that these sectors show strong potential for growth in the country. Kuwait is also eyeing Egypt’s airport privatization plan as the government prepares to offer 11 airports to the private sector, according to previous reports.

ICYMI- President Abdel Fattah El Sisi was in Kuwait earlier this month to drum up investment, with Egypt reportedly hoping to attract some USD 4 bn in new Kuwaiti investments in 2025.

This is a big W for Egypt: The plan would help Egypt by clearing USD 4 bn in liabilities, showing growing investor confidence, attracting more investments in the long run, and strengthening Egypt’s FX position.

We’ve seen this before with our Gulf friends: Abu Dhabi wealth fund ADQ last year converted USD 11 bn of UAE deposits at the CBE into investments in the USD 35 bn Ras El Hekma project, alongside USD 24 bn in fresh investment. The move helped Egypt write off USD 11 bn in external debt and ease FX backlogs in the banking system. Saudi Arabia also pledged last year to convert its deposits at the CBE into investments in Egypt, but the plan has yet to materialize.

The news also found its way on to the airwaves last night: General Authority for Freezones and Investment head Hossam Heiba called in to Sada El Balad’s Trending to emphasise the importance of incoming Kuwaiti investments (watch, runtime: 3:04). Heiba described Kuwaiti investors as among the earliest Gulf investors in Egypt, and discussed their expanding footprint in the country across sectors including agriculture, industry, financial services, and real estate.

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