View of Sharm El-Sheikh airport's Terminal 1 (Photo: Courtesy of Sharm El-Sheikh airport website)
Egypt said on Sunday it expected to receive around $425 million in funding from the Islamic Development Bank to develop an oil refinery in Assiut and an airport in the Red Sea resort of Sharm el-Sheikh.
The first agreement is for $198 million earmarked for the refinery, a finance ministry statement said.
A further $226.8 million (not $8.23 million) will go towards the first phase of the Sharm el-Sheikh airport project, it said. Egypt has requested a further $223.2 million for the second phase of the project.
The Islamic Development Bank is an international financial institution that funds development projects in Muslim countries and communities in accordance with Islamic law.
Egypt's economy has been in turmoil since the 2011 uprising that ousted Hosni Mubarak. The government is navigating a difficult course as it seeks to cut its deficit, while reviving flagging growth and encouraging investors and tourists spooked by the political upheaval.
Gulf Arab states have provided more than $12 billion in cash and petroleum products to prop up Egypt's economy since the ouster of Islamist President Mohamed Morsi a little over a year ago. But the government has introduced painful cuts to energy subsidies as it seeks to curtail spending and shore up finances.
The lending will come in the form of a tenancy contract, which is an Islamic funding structure, and will be repaid over 15 years. It will be guaranteed by the finance ministry.
The Islamic Development Bank made financing contributions worth about $1.85 billion in Egyptbetween July 2013 and August 2014, the statement said, adding that Egypt would also seek external sources of funding for other development projects.