In spite of a European Union budget shortfall of € 8.9 billion it has approved a financial aid package to Egypt worth € 5 billion. Egypt is also due to receive a $4.8 billion loan this week from the IMF.
As EU member countries fail to reach agreement on the shortfall in the 2013 budget, funds have been made available to give grants and loans to Egypt. According to the BBC Egypt faces a $28 billion budget deficit. In the wake of the overthrow of Hosni Mubarak revenue from tourism has fallen dramatically, growth has dropped and foreign reserves almost halved.
Naharnet reported EU foreign policy chief Catherine Ashton made the announcement about EU funding to Egypt, saying "We did not just come with promises, but with real commitments."
According to Al Arabiya the European Investment Bank is to grant Egypt € 2 billion; EU countries will provide € 1 billion; and the European Bank for Reconstruction and Development will grant € 2 billion. The office of President Mohamed Mursi announced it was "a strong sign of of EU’s support for Egypt’s path to development."