The agreement is designed to boost cooperation in areas including trade and security, while delivering funding over the next three years to support Egypt’s economy.
The European Union announced a €7.4 billion (US$8.06 billion) funding package and an upgraded relationship with Egypt, part of a push to stem migrant flows to Europe that has been criticised by rights groups.
The agreement, which lifts the EU’s relationship with Egypt to a “strategic partnership”, was announced as a delegation of leaders visited Cairo. It is designed to boost cooperation in areas including renewable energy, trade, and security while delivering grants, loans and other funding over the next three years to support Egypt’s faltering economy.
The proposed funding includes €5 billion in concessional loans and €1.8 billion of investments, according to a summary of the plan published by the EU. An additional €600 million would be provided in grants, including €200 million for managing migration issues.
European governments have long been worried about the risk of instability in Egypt, a country of 106 million people that has been struggling to raise foreign currency and where economic adversity has pushed increasing numbers to migrate in recent years.
Inflation has been running close to record highs and many Egyptians say they struggle to get by. Over the past month, however, the financial pressure on the government has eased as Egypt has struck a record deal for Emirati investment, expanded its loan programme with the International Monetary Fund, and sharply devalued its currency.
