Saudi Crown Prince Mohammed bin Salman arrived in Cairo on Tuesday for a visit aimed at enhancing economic and trade relations between Saudi Arabia and Egypt, as well as discussing regional issues concerning the situations in Lebanon and Gaza, according to Egyptian diplomatic sources.
The Saudi Press Agency (SPA) reported that Crown Prince Mohammed bin Salman and Egyptian President Abdel Fattah al-Sisi will explore ways to bolster bilateral relations and address mutual interests. This visit comes at a critical time as Egypt is facing a severe economic crisis, increasing the significance of Gulf investments in supporting the country’s economy. The Crown Prince’s last official visit to Egypt was in 2022.
Saudi Investments in Egypt
The visit comes amid speculation about new Saudi investments in Egypt, which has recently seen substantial inflows of foreign financing, including a massive $35 billion deal with the Emirati “ADQ” company, one of Abu Dhabi’s sovereign wealth funds. Financial data indicated that Egypt’s dollar-denominated sovereign bonds rose following the announcement of the visit, with long-term bonds maturing in 2059 increasing by 1.73 cents to reach 77.8 cents per dollar, reflecting market confidence in these investments’ potential to support the Egyptian economy.
Investment Over Aid
Since President Abdel Fattah al-Sisi took office, Saudi Arabia has provided significant financial support to Egypt; however, in recent years, the Kingdom has indicated a shift in strategy from providing direct financial aid to enhancing investments. According to statements by Egyptian Prime Minister Mostafa Madbouly last September, Saudi Arabia plans to invest $5 billion in Egypt, a sum separate from the deposits the Kingdom has made to the Egyptian central bank.
Egypt is actively seeking substantial Gulf investments, while Saudi Arabia is focusing on developing tourism sites along the Red Sea and in the southern Sinai Peninsula, both of which are of particular interest due to their prime location opposite Saudi Arabia. These investments arrive at a critical juncture for Egypt, which is grappling with record inflation, high debt levels, and a sharp decline in the value of the Egyptian pound.
According to “TradeWeb” data, Egypt’s dollar-denominated sovereign bonds saw significant increases after the visit announcement, with long-term bonds registering the most gains. The bonds maturing in 2059 rose by 1.71 cents, reaching 77.78 cents per dollar.
