Negotiators from the European Parliament and the European Council have agreed on a financial assistance package for Egypt of up to 4 billion euros in loans on Monday, as part of broader cooperation frameworks linked to economic reform and political benchmarks.
According to a statement by the European Parliament, the total aid package includes 5 billion euros in loans, of which 1 billion euros had already been disbursed as a short-term loan by the end of 2024. The newly approved 4 billion euros constitutes the second tranche, to be repaid over 35 years.
The disbursement is contingent on Egypt's “satisfactory implementation” of an International Monetary Fund (IMF) program and other policy reforms, which will be detailed in a memorandum of understanding between the EU and the Egyptian government.
Each year, Egypt will submit a progress report to the European Parliament outlining the country’s economic outlook, the financial impact of the loans, and steps taken to support democratic institutions, rule of law, and human rights protections.
In April, a senior Egyptian government source familiar with the foreign funding file told Al Manassa that Cairo had already received assurances from both the European Commission and the Parliament that the second tranche would be released by June.
The source, who requested anonymity, added that Egypt had asked for the disbursement to be expedited in light of its pressing economic needs.
In March, the EU unveiled a 7.4 billion euros partnership package for Egypt, which includes 5 billion euros in concessional loans, 1.8 billion euros in investments, and 600 million euros in grants—200 million of which are earmarked for addressing migration-related challenges.
“I welcome the agreement reached with the Commission and the Council on the MFA for Egypt. It is a balanced text that will serve European interests while respecting the specific situation of our Egyptian key partner.” said MEP and rapporteur for the financial aid package, Céline Imart, in the Parliament's statement on Monday.
Before the deal takes effect, it requires formal approval from the European Parliament’s International Trade Committee, the Parliament's plenary, and the Council of the European Union.
Earlier this year, Egyptian Prime Minister Mostafa Madbouly confirmed receipt of the first 1 billion euro tranche under the EU’s macro-financial assistance (MFA) program, which supports Egypt’s budget and overall macroeconomic stability. The current funding framework extends until 2027.
