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UAE, Egypt launch giant $20 bn investment programme

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Abu Dhabi (AFP)

The UAE and Egypt launched a giant $20 billion joint investment programme Thursday to develop "economic and social projects", as Cairo seeks assistance to boost its sagging economy.

Abu Dhabi Crown Prince Sheikh Mohammed bin Zayed Al-Nahyan made the announcement while receiving Egyptian President Abdel Fattah al-Sisi on a visit to the Emirati capital.

"We launched a joint strategic investment platform between the UAE and Egypt worth $20 billion to implement vital economic and social projects for our brotherly countries," Sheikh Mohammed said in a tweet.

He added that he discussed with Sisi ways to strengthen relations and enhance coordination.

The UAE has been a firm regional backer of former army chief Sisi since the Egyptian military overthrew Islamist president Mohamed Morsi in 2013.

"Egypt's security is as important as the UAE's security, and its progress, development and stability are important to the UAE and all Arab countries," said Sheikh Mohammed, according to a statement carried by the UAE state news agency WAM.

"Confronting the challenges and risks facing the Arab region requires intensifying the ongoing consultations between our countries and joint Arab action," he added.

His comments on security come amid increased regional tensions following a string of attacks on oil tankers and ships in the Gulf that the United States and its Gulf allies have blamed on Iran. Tehran denies the accusations.

The UAE and Egypt are also part of a Saudi-led alliance that cut relations with Qatar in June 2017, accusing it of bankrolling Islamist extremist groups and of being too close to regional rival Iran. Doha denied the accusations.

- Sagging economy -

Cairo has been seeking investment to boost its sagging economy and create jobs.

Poor and middle-class Egyptians have borne the brunt of harsh austerity measures since 2016 when the government secured a $12-billion bailout from the International Monetary Fund in exchange for tough economic reforms.

Nearly one in three Egyptians live below the poverty line, according to official figures released in July.

Reforms have met with some pushback, fuelled by allegations of graft among the political and military elite.

Rare, small-scale protests broke out in September calling for Sisi's removal after an exiled Egyptian businessman accused the president and top military brass of rampant corruption.

Egypt's economy took a battering in the immediate aftermath of the revolution that toppled longtime autocrat Hosni Mubarak in 2011.

Direct foreign investment has grown to record levels in recent years, but the national debt has ballooned since the pound was floated in November 2016, leading to a sharp depreciation.

The government in May raised electricity rates by 15 percent as part of the belt-tightening measures under the IMF programme.

In April, the IMF forecast the Egyptian economy would pick up speed this year, expanding by 5.5 percent, while inflation should slow to 14.5 percent.

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