NewsAnalysis:Egypt,UAEmajorinvestmentdealtolessenCairo'seconomicstruggle_GuangmingOnlinebyMarwaYahyaCAIRO,Feb.25(Xinhua)--Afreshmultibillion-U.S.dollarcoastaldevelopmentdealbetweenEgyptandtheUnitedArabEmirates(UAE)willhelptomitigatetheNorthAfricancountry'seconomicstruggleandbridgeitsfinancinggap,accordingtoEgyptianeconomists.ThetwoArabcountriesreachedagroundbreakingdealonFridaytobuildanewcityonEgypt'snortherncoast,inabidtoboosttourism,investment,andforeigncurrencyreserves.Underthedeal,theUAEwillinject35billionU.S.dollarsinforeigndirectinvestmentintoEgyptoverthenexttwomonths,andthetotalinvestmentisexpectedtoreach150billiondollarsthroughouttheproject."ThisisthelargestamountofFDIinthehistoryofthecountry,"andtheimmediatepaymentwillhelpthecountryovercomeitscurrenthardcurrencycrunch,saidEgyptianPrimeMinisterMostafaMadbouly.ThedealenablesthetwocountriestodevelopRasAl-Hekma,a170-square-kmareawestofEgypt'sMediterraneancityofAlexandria,intoanewmassiveurban,businessandtourismcenter,saidapresidentialstatementonFriday.Withapaymentof24billiondollars,theAbuDhabi-basedsovereignfundADQwasgrantedtherightstodevelopRasAl-Hekma.ADQwillalsoconvert11billionofitsdepositsintoinvestmentsinadditionalprojectsacrossEgypttosupportitseconomicgrowthanddevelopment,theADQsaidinastatement.Atthesigningceremony,Madboulysaidthedealwasthestartofseveralinvestmentagreementsthatthegovernmentwasworkingontoincreaseforeigncurrencysources."ThedealconstitutesabreakthroughinCairo'seffortstolureforeigndirectinvestmentandenditsworstforeignexchangecrisis,"WaleedGaballah,amemberoftheEgyptianAssociationforPoliticalEconomy,StatisticsandLegislation,toldXinhua.EgypthasbeendealingwithasevereforeigncurrencyshortageoverthepastfewyearsduetodeclinedtourismrevenuesduringtheCOVID-19pandemic,risingcommoditypricesanddisruptedsupplychainsfollowingthe2022Russia-Ukraineconflict,andarecentplungeintheSuezCanal'sincomeamidsurgingconflictintheRedSea,theeconomistsaid.AbuBakral-Deeb,anadvisortotheCairo-basedArabCenterforResearchandStudiessaidthedealisexpectedto"generatebigliquidityintoEgypt,"acountryactivelypursuingadditionalfundstobridgeitsbillionsoffinancinggap.Egypthasbeensellingstakesofstate-ownedassetsandenteringintonewloanprogramswithforeignfinanceinstitutions,amongothermeasures,tobridgeitsroughly17billiondollarfinancinggapby2026,anumberestimatedbytheIMF.UnderthedealwithUAE,Egyptwillalsoobtain35percentoftheproject'srevenues,Madboulysaid,expectingtheprojecttoattracteightmilliontouristsandcreatemillionsofjobopportunitiesduringandafteritsimplementation.Al-DeebreiteratedthatthedealissignificantbecauseitwillencourageotherFDIandreducethepressureonEgypttoobtaindollars.Egypt'sdollar-denominatedsovereignbondsjumped1.4centsonFridayafterthedealwassignedtotradeataround68cents--itshighestlevelinayear,accordingtodatabyTradeweb,afinancialcompanyfortradingfixed-incomeproducts.KarimAdel,headoftheCairo-basedAlAdlCenterforEconomicandStrategicStudies,believedEgyptis"anemergingstablemarketandcapableofattractingforeigninvestments."However,thecountryhas"tostabilizeitscurrencyvalueagainsttheU.S.dollars,toensureinvestorswhenitcomestosigningcontracts,"Adelsaid.GreenbackpriceonEgypt'sblackmarkethasbeenhitsharplyafterthedealwasannounced.OnedollarwasexchangedonSundayfor47poundsinsteadof63onFridaymorning.Theofficialexchangeratestandsat30.8pounds.Editor:DisclaimerTheviewsandopinionsexpressedinthisarticlearethoseoftheauthor's,GMW.cnmakesnorepresentationsastoaccuracy,suitability,orvalidityofanyinformationonthissiteandwillnotbeliableforanyerrors,omissions,ordelaysinthisinformation.