Egypt says Qatar gave $500 million to help with budget

October 9, 2011 12:23

CAIRO - Egypt's finance minister, who has been negotiating with Gulf Arab states for financial assistance, said on Sunday that Qatar had given a grant of $500 million to support the budget which has ballooned as a result of political turmoil.

Hazem el-Beblawi said last week he was negotiating with Saudi Arabia and the United Arab Emirates for funds worth close to $7 billion. He also said he was considering International Monetary Fund financing that Egypt previously turned down.

Egypt's economy, which had been growing robustly before the popular uprising earlier this year, was hit hard by the protests, which prompted foreign investors to withdraw funds and saw major revenue sources like tourism suffer.

"They transferred $500 million as a grant to Egypt," Hazem el-Beblawi told Reuters, adding that the Qatari funds had been transferred in the past week or so. "It is a grant for budgetary support," he added.

Egypt forecasts a budget deficit of 8.6 percent of gross domestic product in the financial year to June 2012. Economists say the estimate may prove optimistic.

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