Saudi Arabia has agreed to extend the terms of a $5 billion aid package to Egypt that took effect in March, Saudi state-run media said on Tuesday.
The move is aimed at bolstering the North African country’s recent deal with the International Monetary Fund.
The state-run press noted that the extension would allow Egypt to open ‘’new financing channels with regional and international organizations″ and help the completion of a preliminary $3 billion agreement the Middle East’s most populous country reached with the IMF in October.
The Saudi media did not provide further details on the terms of the extension, including how long at the time of filling this report.
The Egyptian economy has been hard-hit by the coronavirus pandemic and the war in Ukraine. Egypt is the world’s largest wheat importer, most of which came from Russia and Ukraine. In the fallout of the war in Eastern Europe, Egypt has struggled to combat surging inflation, which peaked at over 16% in October.
Egypt’s “staff level agreement” with the IMF last month is set to last for 46 months and aims to tackle Egypt’s inflation problem and restructure its ailing economy. The terms of the preliminary agreement saw Egypt’s government introduce a series of immediate economic reforms including a hike in key interest rates and a shift towards a flexible exchange rate.