Egypt and the Kingdom of Saudi Arabia have a firm and unshakable relationship with the changes or fluctuations in the region, resulting from a historical depth at all levels, especially between the leaderships of the two brotherly countries over many years, which was reflected in the strength of the consensus of political visions and its great impact on economic relations which grow and increase every year.
In 2016, President Abdel Fattah El-Sisi and the Custodian of the Two Holy Mosques, King Salman bin Abdulaziz, established the Saudi-Egyptian Coordination Council, by concluding 17 agreements that formed a roadmap for economic cooperation between the two countries, in the fields of housing, oil, education, agriculture, and health, including an agreement to develop Kasr Al-Aini Hospital at a value of 120 million. A second agreement was reached to finance the construction of a power station west of Cairo for $100 million. This council contributed significantly to Saudi investment growth.
In 2018, specifically in March of 2018, several bilateral agreements were signed between the two countries, witnessed by President Abdel Fattah El-Sisi and Prince Mohammed bin Salman, Crown Prince of Saudi Arabia and Prime Minister during his visit to Egypt, in various huge investment fields, and the establishment of an Egyptian investment fund- Saudi Arabia, with a total amount of $ 16 billion to inject Saudi investments into these projects in several Egyptian governorates, then followed by the signing of various other agreements.
In terms of numbers, Saudi Arabia is the first global and Arab investor in Egypt, with investments of more than $ 55 billion already in place, in addition to expected investments of about $ 30 billion during the coming period, including agreements signed worth $ 8 billion, during the visit of Prince Mohammed bin Salman, Crown Prince of Saudi Arabia, to Egypt.
It was a meeting during which 14 agreements were concluded with a total investment of $8 billion. This indicates that these contracts cover all sectors and fields, including logistics, industrial, commercial, and agricultural.
Perhaps the statements of Dr. Majid Al-Qasabi, the Saudi Minister of Trade and Investment, about the strength of the relations that bind Egypt and Saudi Arabia with the bonds of brotherhood and neighborhood, and the long history of cooperation in various fields, is the best evidence of these solid relations, especially his reference to the keenness of the Custodian of the Two Holy Mosques King Salman bin Abdulaziz, and the Crown Prince Prince Mohammed bin Salman bin Abdulaziz to strengthen ties of connection and integration with Egypt at all levels.
The minister’s assertion that Saudi companies have tremendous confidence in the Egyptian market, which is evident in the presence of 6,225 Saudi industrial companies operating in Egypt with investments amounting to $30 billion, confirms the increasing growth in economic relations, pointing out that 518 Egyptian companies are operating in the Saudi market, in addition to the spread of 285 Egyptian trademarks in Saudi Arabia.
The minister explained that these figures reflect Egypt’s investment environment. The last period witnessed the removal of many challenges faced by Saudi companies in the Egyptian market and the provision of many facilitations for them.
The Saudi Minister of Commerce and Investment pointed out that his country is looking forward to being the first trading partner for Egypt during the next five years.
And reflecting the minister’s statements, on June 14, 2021, Egyptian-Saudi agreements were signed to increase cooperation in 30 fields, most notably industry, and exports.
Where Egypt and Saudi Arabia agreed to develop and strengthen the bonds of cooperation in various product and service sectors, especially the sectors of trade, industry, investment, agriculture, health, education, transport, petroleum, media, environment, standards and metrology, small and medium enterprises, financial, banking and customs sectors, as well as the food, medicine, health, and mineral wealth sectors.
The most critical Saudi investments in Egypt are concentrated in the service sectors, which include transportation, logistics, health, education, and consulting services, followed by industrial investment, then the construction sector, agricultural investment and food industries, tourism investment, investment in the communications sector, and then investment in the financial sector.
Relations are not limited to companies and industrial projects. Instead, they are extended to Egypt and Saudi Arabia signing a cooperation agreement to establish an electrical interconnection project between the two countries.
This comes as a prelude to establishing a common electricity market and operating the first phase of the electric interconnection line between Egypt and Saudi Arabia. This is to exchange 3,000 megawatts.
In terms of the government’s support for inter-relationships, Dr. Mostafa Madbouly, Egypt’s Prime Minister, had previously witnessed the signing ceremony of a joint report, on the agreement in the form of a draft agreement, between the governments of the Arab Republic of Egypt and the Kingdom of Saudi Arabia, regarding the Saudi Public Investment Fund investing in Egypt.
It was signed on behalf of the Government of the Arab Republic of Egypt, Dr. Hala El-Said, Minister of Planning and Economic Development, Chairman of the Board of Directors of the Sovereign Fund of Egypt, and on behalf of the Government of the Kingdom of Saudi Arabia, Dr. Essam bin Saad bin Saeed, Minister of State and Member of the Council of Ministers for Shura Council Affairs.
Relations culminated in June 2022 when Egypt and Saudi Arabia issued a joint statement on the occasion of the visit of Prince Mohammed bin Salman, Crown Prince of Saudi Arabia, to Cairo and his meeting with President Abdel Fattah El-Sisi.
“The Kingdom of Saudi Arabia intends to invest (30) billion dollars in Egypt,” the statement said. The two sides affirmed their keenness to enhance investments between the two countries and intensify communication between the private sectors in the two countries to discuss investment and trade opportunities and facilitate any difficulties that they may face.”
During the same month, the General Authority for Investment and Free Zones agreed with the Saudi Minister of Investment to discuss the future of the investment partnership between the two countries, as the two sides agreed to develop an integrated plan to attract Saudi investment to Egypt, to ensure the sustainability of the flow of Saudi investments, within the framework of the economic rapprochement between the two brotherly countries.
Apart from numbers and established relations, Saudi Arabia renewed a $5 billion deposit with the Central Bank of Egypt in November 2022. This is according to the Saudi Press Agency (SPA).
Saudi Arabia deposited this amount in the Central Bank of Egypt to support its economy. This economy was greatly affected by the Russian-Ukrainian crisis and the exit of billions of dollars from government debt instruments, which led to local currency scarcity.
The Kingdom’s statement, published by the “SPA” agency, stated that Saudi Arabia “continued to provide generous support to enhance economic stability for Egypt, by extending the term of the deposit with the Central Bank of Egypt at a value of $ 5 billion.”
The statement added, “Egypt has enormous growth potential in light of the implementation of many structural reforms that have contributed to stimulating the private sector’s growth and raising its competitiveness, and continuing efforts to achieve higher”.
The statement indicated that there is communication between the concerned authorities in the two countries regarding pumping numerous investments into the Egyptian market in foreign currencies in addition to Saudi deposits, which it is hoped will contribute to opening new financing channels with regional and international organizations, including facilitating the completion of the International Monetary Fund program agreement.
“Saudi support was not limited to keeping those deposits in the Central Bank of Egypt, but rather large investments were pumped from the government sector and the Saudi private sector into the Egyptian market to achieve more economic development in Egypt, with the firm desire to continue with more investments in the sectors.”,” according to the statement.