Gulf's Shift to Direct Investment in Egypt
The economic relations between Egypt and Gulf countries have undergone a structural transformation from financial support and banking deposits to investment partnerships and large-scale developmental and logistical projects. The aim is to bolster foreign currency reserves and address geopolitical challenges, such as navigational disruptions in the Red Sea and declining Suez Canal revenues. The United Arab Emirates is at the forefront as a partner, with investments estimated at around $40 billion during the fiscal year 2023-2024, followed by Saudi Arabia with $60 billion, Qatar with approximately $40 billion, and Kuwait with financial relations amounting to about $23.5 billion. Experts believe that the repercussions of the Russian-Ukrainian war have prompted the Gulf to shift its investments from deposits to direct investments in Egypt, which is considered a safe haven after its resources declined due to regional tensions. Egypt has also been strengthening its foreign exchange reserves through remittances from workers in the Gulf, which exceeded $41 billion in the previous year. This supports the stability of its economy and boosts its future projects in the energy sector.
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