Saudi deposits $5bn in Egypt, plans to invest double: state media

Saudi deposits $5bn in Egypt, plans to invest double: state media
Egypt is set to receive $5 billion into its central bank from Saudi Arabia, as the north African country struggles with rising wheat prices.
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Egypt has been struggling recently under the weight of rising wheat prices [Getty]

Saudi Arabia has deposited $5 billion at Egypt's central bank, according to state media in both countries, a day after Qatar pledged $5 billion in investment and amid a surging wheat import bill. 

The Egyptian and Saudi governments have signed a draft agreement for Saudi investments in the country totalling a projected $10 billion, according to a statement by the Egyptian cabinet. 

The announcements come as the North African country enacts a slate of financial measures to mitigate the economic fallout of Russia's invasion of Ukraine.

As the world's largest importer of wheat, Egypt relied on the two countries for 85 percent of its supply, as well as 73 percent of its sunflower oil.

Egyptian Prime Minister Mostafa Madbouli said his government is intent on "deepening economic and investment cooperation" with Saudi Arabia.

Egyptian state media reported the sizable deposit Wednesday, citing a statement by the Saudi Press Agency

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"The Kingdom of Saudi Arabia, implementing the directives of the Custodian of the Two Holy Mosques King Salman bin Abdulaziz Al Saud and His Highness the Crown Prince, has deposited $5 billion into the Central Bank of Egypt," the statement said.

This is the second major deposit inside five months, with Riyadh announcing last November it had deposited $3 billion in Egypt's central bank.

On Tuesday, Egypt's cabinet also announced that Qatar is to plough $5 billion into "investments and partnerships" in Egypt, without giving specifics.

As a result of a hike in food prices, inflation soared to an almost three-year high of 10 percent in February.

On 21 March, the Egyptian pound plunged nearly 17 percent in value against the US dollar, as the finance ministry announced a $7 billion relief package to shield society's most vulnerable.

Two days later, the International Monetary Fund said Egypt had applied for a new loan package.