The Arab Fund for Economic and Social Development (AFESD) has pledged to lend US$ 200 million this year, to Egypt to finance drilling wells and building desalination projects in Sinai.
AFESD representative Mohamed Al-Iriani said he agreed with the Egyptian side to reduce interest on the loan from 3% to 1%, to be repaid over 20 years, with a five-year grace period. The loan is the first tranche of a US$ 900 million loan to Egypt over the next three years, covering a number of elements according to Al-Iriani.
He went on to say the fund lends to Arab states at concessional interest rates of from 2.5% for low-income countries and 3% for other Arab countries, with grace periods ranging from 22 to 25 years, as well as non-returnable grants and aids.