Kuwait promises Egypt $4 billion in aid-state news agency

Reuters News
Posted: Jul 10, 2013 9:55 AM

KUWAIT (Reuters) - Kuwait will provide $4 billion in aid to Egypt, state news agency KUNA said on Wednesday, matching pledges by Saudi Arabia and the United Arab Emirates that showed Gulf Arab approval of the Egyptian army's ousting of Islamist President Mohamed Mursi.

KUNA said the package would comprise a $2 billion central bank deposit, a $1 billion grant and $1 billion in oil products,

On Tuesday Saudi Arabia and the United Arab Emirates each pledged $4 billion in aid to Egypt, where the army overthrew the Muslim Brotherhood's Mursi a week ago after huge street demonstrations against the elected president.

KUNA did not say when the Kuwaiti aid would arrive.

Kuwait has in the past cooperated with Riyadh and Abu Dhabi, pledging financial aid for Gulf neighbors hit by social unrest such as Bahrain and Oman, but also for Morocco and Jordan.

The aid from the three Gulf Arab oil producers is expected to help Egypt avoid a balance of payments crisis and overcome fuel shortages that partly stoked public anger against Mursi.

It will also ease pressure on Cairo to conclude long-running talks with the International Monetary Fund on a $4.8 billion loan. However, a surging fiscal gap and political turmoil following Mursi's toppling last week will remain a pressing challenge for Egyptian authorities, analysts said.

Qatar lent Egypt more than $7 billion during Mursi's abruptly curtailed year in power, but other Gulf states remained aloof, wary of the Muslim Brotherhood's potential influence in their own conservative, dynastically ruled countries.

(Reporting by Ahmed Haggagy and Amena Bakr; Writing by Martin Dokoupil; Editing by Alistair Lyon)