Egypt seeks U.S. debt forgiveness, minister says

Reuters News
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Posted: Apr 14, 2011 2:55 PM
Egypt seeks U.S. debt forgiveness, minister says

WASHINGTON (Reuters) - Egypt has asked the United States to forgive about $3.6 billion in debt to help the country's new government restore growth and create jobs for young people, a top Egyptian official said on Thursday.

"What we're asking for from our American friends is to give us debt forgiveness," Fayza Mohamed Aboulnaga, the Egyptian minister of planning and international cooperation, said at the U.S. Chamber of Commerce.

Aboulnaga acknowledged the request was a difficult one at a time when the United States is grappling with its own huge budget deficit but said it was in the United States' strategic interest to see Egypt succeed.

"If, God forbid, we go wrong in Egypt," the rest of the region is likely to follow the same course, she said.

In the long run, Egypt wants to forge an relationship with the United States based on investment and trade, she said.

Egyptian Finance Minister Samir Mohamed Radwan, speaking to the same group, urged U.S. companies to step up their investment in the country.

The government has had to scaled down its growth forecast to between 1 percent and 2 percent this year, while needing growth of about 7 percent to create the jobs it needs, Radwan said.

He also urged the business leaders to put in a good word with multilateral lending institutions.

"We need cash," Radwan said. "We need to fill that fiscal gap."

(Reporting by Doug Palmer; Editing by Bill Trott)