Supervisor Elham AbolFateh
Editor in Chief Mohamed Wadie

Egypt & EU Agree on 7.4 Bln Euro Deal on Energy, Migration

Sun 17 Mar 2024 | 09:29 PM

Egypt and the European Union inked a significant financial and cooperation package worth €7.4 billion ($8 billion) on Sunday, aiming to bolster economic ties, energy collaboration, and address the challenges of irregular migration.

 The comprehensive deal, announced by a senior European Commission official, underscores the EU's strategy to diversify energy sources away from Russian gas amid ongoing tensions in Ukraine, while supporting Egypt's struggling economy.

The agreement, to be formalized in Cairo by EU Commission President Ursula von der Leyen alongside leaders from Austria, Belgium, Cyprus, Greece, and Italy, includes €5 billion in loans spread over four years, €1.8 billion in investment funds, and substantial allocations for bilateral projects, particularly focusing on migration issues. Egyptian President Abdel Fattah al-Sisi is expected to represent the North African nation in the landmark signing.

This financial lifeline comes at a critical juncture for Egypt, which is grappling with a severe economic downturn exacerbated by external debts nearing $165 billion and the adverse effects of the COVID-19 pandemic on key sectors like tourism. The International Monetary Fund recently approved an $8 billion loan package for Egypt, contingent on economic reforms including a more flexible exchange rate and increased interest rates.

Egypt's strategic geopolitical position, sharing borders with Libya, the Gaza Strip, and Sudan, places it at the heart of several regional conflicts and makes it a key partner for the EU in managing migration flows and enhancing security cooperation. The country hosts approximately nine million migrants and refugees, including significant numbers from Sudan and Syria, highlighting its role as a stabilizing force in a volatile region.

The EU's partnership with Egypt also reflects a broader pattern of engagement with North African countries to mitigate the surge of irregular migrants to Europe, a policy that has sparked criticism from human rights organizations. Critics argue that such agreements with authoritarian regimes compromise the EU's commitment to human rights by prioritizing migration control over the welfare of migrants, asylum seekers, and refugees.

Despite these controversies, the EU and Egypt emphasize the mutual benefits of their cooperation, aiming to address the root causes of irregular migration, enhance border security, and promote sustainable economic development. This deal not only signifies Europe's ongoing efforts to reduce its dependency on Russian energy but also represents a vital support mechanism for Egypt as it navigates through its current economic crisis.