Egypt's Finance Ministry: Qatar Deposits $500 Mln at Central Bank

CAIRO (Zawya Dow Jones)--Qatar has deposited $500 million at the Egyptian central bank, the first tranche of a $2 billion loan pledge, Egypt's Ministry of Finance said Thursday.

The oil and natural gas-rich Arabian Gulf state told Egypt's finance ministry that it will deposit the remainder of the loan in September, according to a ministry press statement.

Egyptian Minister of Finance Mumtaz Al Said asked the central bank to immediately convert the funds into Egyptian pounds to provide support to Egypt's depleted treasury.

The announcement comes just a day after Egyptian President Mohammed Morsi requested a $4.8 billion loan from the International Monetary Fund during a visit by the Fund's head, Christine Lagarde.

Egypt's economy has struggled to attract investment and tourist dollars since political instability and recurring violence descended on the country following a revolution in early 2011.

Qatar and other Gulf Arab states are only now following through on financial aid promises made last year. Saudi Arabia deposited $1 billion in Egypt's Central Bank in May.

Egyptian economists estimate that Egypt will require more than $12 billion in external financing this year in order to mend the gaping holes in its budget.

According to Zwaya