The Gulf banking syndicate that agreed last month to lend USD 3 bn to the Egyptian government has disbursed the funding, Al Shorouk reports, citing unnamed sources. The three-year loan is being arranged by First Abu Dhabi Bank and Emirates NBD, and is split 50-50, with USD 1.5 bn allocated to ESG projects and USD 1.5 bn going to Sharia-compliant investments.

Who’s lending: Abu Dhabi Commercial Bank, Abu Dhabi Islamic Bank, Mashreq Bank, Bank ABC, National Bank of Kuwait, Ahli United Bank of Kuwait, Al Ahli Bank of Kuwait and Italy’s Intesa Sanpaolo Bank, in addition to the lead arrangers.

This is the second loan the government has taken out from Gulf financial institutions since 2020: Egypt took out a USD 2 bn 12-month loan arranged by FAB and Emirates NBD in 2020, which it finished repaying earlier this year. The loan — divided into a USD 1.5 bn conventional tranche and a USD 500 mn Islamic tranche — was taken out to plug budget shortfalls and support the economy through the covid crisis.

OTHER DEBT NEWS-

A USD 250 mn railway development loan from Korea: South Korea government has given its initial approval to a USD 250 mn soft loan to fund signaling upgrades for the 224-km Luxor-Aswan railway, Al Mal reports, citing unnamed sources. Korea had stipulated that the Egyptian government only use state-owned Korean companies to implement the upgrades, from the consultant to the companies implementing the work. Korean entities will now begin submitting their technical and financial offers.

The General Authority for the Suez Canal Economic Zone has received a EGP 1.5 bn loan from the National Bank of Egypt and Banque Misr to tide it over until its EGP 10 bn loan agreed with a syndicate of banks earlier this year has been disbursed, sources told Al Shorouk. In April, the SCZone signed an agreement for the 10-year loan with a group of banks including CIB, Banque du Caire, the Arab African International Bank and Suez Canal Bank to fund infrastructure projects. The NBE and Banque Misr are managing the facility.