Saudi Arabia says it deposited $5B in Egypt’s central bank

Saudi Arabia has announced a $5 billion aid package to cash-strapped Egypt, where the economy is under mounting pressure, in part because of the economic fallout from Russia's war on Ukraine

CAIRO -- Saudi Arabia on Wednesday announced a $5 billion aid package to cash-strapped Egypt, where the economy is under mounting pressure, in part because of the economic fallout from Russia’s war on Ukraine.

The state-run Saudi Press Agency said the funds, deposited in Egypt’s Central Bank, are part of Saudi Arabia’s “tireless efforts” to support Egypt, the Arab World’s most populous country. The money will be added to Egypt’s foreign reserves, which stood at around $41 billion by the end of February, and help with critical imports and propping up the sliding national currency.

The new package came less than two weeks after the Central Bank of Egypt raised its key interest rate and allowed the Egyptian pound to plunge to over 18.30 to the dollar — from an average of 15.6 pounds for $1.

The moves have taken a heavy toll on poor and middle-class Egyptians who have faced price hikes since the government embarked on an ambitious reform program in 2016 to overhaul the country’s battered economy. The reforms were agreed on with the International Monetary Fund for a $12 billion bailout.