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Donors Pledge $ 10.3 Billions To Egypt Over Three Years
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| World Bank Vice President Louis Sarbib during a press conference following the final session of the donors conference. |
SHARM EL-SHEIKH, Egypt, Feb. 6 (IslamOnline & News Agencies) - International donors pledged 2.1 billion dollars to be sent quickly this year to help Egypt cope with the aftershock of the September 11 attacks in the United States. Approval by the IMF and World Bank of Egyptian macro-economic proposals is essential.
The "quick disbursement funds," including 500 million dollars each from the International Monetary Fund (IMF) and World Bank, were part of total pledges of 10.3 billion dollars over three years, Egyptian and World Bank officials said, reported AFP.
However, delivery of the funds still depended on approval by the IMF and World Bank of Egyptian macro-economic proposals, officials from the organizations said.
Egypt's minister of state for foreign affairs, Fayza Abul Naga, who helped spearhead Egypt's appeal to donors, said "this sum of money (2.1 billion) is going to be money available as soon as possible and immediately.
"It is a recognition that the Egyptian economy is capable of recovering and picking up in a very short period of time," Abul Naga told a press conference ending the two-day meeting in the Red Sea resort of Sharm el-Sheikh.
The 2.1 billion dollars also includes 430 million dollars from the U.S. Agency for International Development (USAID), though the money comes out of U.S. AID's long-term program in Egypt, U.S. delegates said.
Jean-Lous Sarbib, the World Bank vice president for the Middle East and North Africa, stressed that the sums of money mentioned at the conference were pledges that may or may not materialize from donors.
"It will be a challenge for all of us around this table to make it happen," Sarbib told a press conference. "In three years, we'll see how much has actually been committed."
The form of delivering much of the aid - whether grants, loans or other aid - also had to be decided. Sarbib said the 10.3 billion dollars reflected "new commitments" from donors, commitments he said that were not part of previous agreements or conventions.
However, the U.S. share of the 10.3 billion dollars - 1.845 billion dollars over the next three years - is "part of our ongoing plan," USAID executive Lori Forman said. Egypt and the World Bank organized the conference with three dozen donor nations and organizations to help Egypt cope with the aftershock of the September 11 attacks and generally support the decade-old economic reform program.
Former Egyptian Expert with the IMF, Ahmed Abu shadi, told IslamOnline today that Sharm conference was just “a routine one sponsored by the World Bank, and attended by donor countries and donation receiving ones. “The main objective of this meeting is for donors to listen to Egyptian officials plans as far economic reform is concerned. That, of course, to make sure donations will be properly used to relieve people’s suffering because of harsh economic conditions,” Abu Shadi said.
In reading the conference declaration, Abul Naga recognized donors' call on Egypt to speed its pace of economic reform. "There was recognition that job creation will be in the private sector, that a dynamic export sector is the crucial engine for growth, and not least that Egyptian young people need to have the quality of education which adequately prepares them for a competitive workplace," she said.
U.S. officials on Tuesday charged that Egyptian government measures, such as complex customs requirements and heavy taxes, discouraged private businesses from creating the jobs needed to promote stability and avert a "social catastrophe."
Egypt had to find jobs for 800,000 new job seekers every year, and those jobs can not come from the bloated state sector, U.S. officials said. Egyptian Prime Minister Atef Ebeid said on the opening day of the conference that Egypt expected between 2.2 billion dollars and three billion dollars, mainly to cope with the aftershock of September 11.
He said that because of the attacks, Egypt lost two billion dollars in the tourism sector, which is the main source of hard currency earnings. IMF officials, which are working on the details of Compensatory Financing Facility to help deal with a "major temporary shock," estimated that Egypt needed to plug a balance of deficit payments of just under two billion dollars.
Egypt had been in trouble before September 11 with an economic slowdown, a liquidity crunch and pressure on its currency, which has led to four devaluations in the last year. Conference organizers declined to disclose a list of all the donors making pledges saying they would hold off to allow time for additional donors to announce pledges.
With additional reporting by, Hamdy El-Hossainy
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