Odd Lots Why the UAE Is Pumping $35 Billion Into Egypt
19 snips
Mar 16, 2024 
Ziad Daoud, Chief Emerging Markets Economist at Bloomberg Economics, dives into the UAE's surprising $35 billion investment in Egypt. He explains the motivations behind this massive financial influx and its implications for Egypt's economy amidst currency crises and inflation. The discussion delves into the geopolitical significance, particularly how this funding could lead to increased tourism and real estate development. Daoud also highlights the complexities of foreign investment in a region marked by political instability and the critical need for economic reforms.
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Egypt's Economic Distress
- Egypt's economy faced challenges due to COVID-19, the Ukraine war, and high wheat prices.
- Policy mistakes, such as relying on hot money and the army's economic role, worsened the situation.
Source of the Investment
- The $35 billion investment originates from ADQ, a new UAE sovereign wealth fund, not ADIA.
- ADQ has been actively investing in diverse Egyptian sectors, including banking and tobacco.
Beyond Economics
- The UAE's $35 billion investment may not be purely economic, given the high price paid for land.
- Regional instability suggests a focus on stability, potentially influencing Egypt's stance on Gaza.