News / Middle East

Egypt Returns $2 Billion to Qatar in Sign of Growing Tensions

FILE - Governor of Egypt's Central Bank Hisham Ramez (L) attends opening session of the Arab Finance Ministers meeting in Dubai, April 2, 2013.FILE - Governor of Egypt's Central Bank Hisham Ramez (L) attends opening session of the Arab Finance Ministers meeting in Dubai, April 2, 2013.
x
FILE - Governor of Egypt's Central Bank Hisham Ramez (L) attends opening session of the Arab Finance Ministers meeting in Dubai, April 2, 2013.
FILE - Governor of Egypt's Central Bank Hisham Ramez (L) attends opening session of the Arab Finance Ministers meeting in Dubai, April 2, 2013.
Reuters
— Egypt has returned $2 billion that Qatar had deposited with its central bank, after talks to convert the funds into three-year bonds broke down, central bank Governor Hisham Ramez said on Thursday.
 
Egypt authorities have also refused a Qatari request to increase the number of flights between the two states, according to Egyptian airport sources, in a further sign of rising tension between the two Arab Muslim states.
 
Cairo's relations with Qatar deteriorated after the Egyptian army deposed Islamist President Mohamed Morsi on July 3. Qatar had been a firm backer of Morsi's Muslim Brotherhood and lent or gave Egypt $7.5 billion during the year he was in power.
 
Qatar had sent Egypt $3 billion in May, of which it converted $1 billion into three-year bonds.
 
Ramez told Reuters in a telephone interview that the Qatari authorities had agreed to convert the entire remaining $2 billion but then changed their minds.
 
“They wanted to postpone it, then they said they would do it like they announced last time, and then they came back with some amendments, doing part and postponing the other part for a time, which we found not suitable for us,” he said. “So we just repaid the deposit.”
 
On July 1, Egypt converted the $1 billion into three-year bonds at 3.5 percent interest and in May it converted another $2.5 billion of Qatari loans into 18-month bonds at 4.25 percent interest. The bonds were listed on the Irish stock exchange.
 
Since Morsi's ouster, Saudi Arabia, Kuwait and the United Arab Emirates have pledged Egypt $12 billion in grants and interest-free loans.
 
“I would assume they are fairly relaxed about their short-term finances and they can rely on aid from other Arab countries,” said Simon Kitchen, a Cairo-based strategist with EFG Hermes.
 
Egyptian officials have said that the loss of the Qatari funds would not affect the country's financial situation during the budgetary year that began on July 1.
 
An official in the Qatari finance ministry said it respected Egypt's decision, according to the state news agency. It also said negotiations had failed after Egypt asked for the full amount to be changed into bonds in one move while Qatar wanted this to be done in stages.
 
Egyptian-Qatari relations
 
Egypt's refusal on Thursday to increase the number of flights between the two states “came in reaction to the recent escalations between Egypt and Qatar after Egypt returned the $2 billion deposit of Qatar,” one airport official said.
 
The official said that during Morsi's rule the Qatari airlines had run more flights but not EgyptAir, harming the Egyptian company's profits.
 
“This deal is expected to be scrapped soon as well,” the source added.
 
Qatar condemned last month's attack by Egyptian security forces on Muslim Brotherhood supporters camps in Cairo in which hundreds were killed and has asked for the release of jailed Muslim Brotherhood leaders. At least 2,000 Islamist activists, mostly from the Brotherhood, have been arrested in the past two months.
 
Egypt called Qatar's pro-Morsi comments clear interference in its affairs. Local media accused Qatar of seeking to take over Egypt's historic regional leadership role.
 
Egyptian authorities have closed the Cairo offices of Qatar's Al Jazeera news channel, accusing it of siding with Morsi, and two Al Jazeera journalists have been detained for over a month.

You May Like

Uganda Court Annuls Anti-Gay Law

Court says law was passed in parliament without enough members present for a full quorum More

Video Thailand Makes Efforts to Improve Conditions for Migrant Laborers

In Thailand, its not uncommon for parents to bring their children to work; one company, in-collaboration with other organizations, address safety concerns More

In Indonesia, Jihad Video Raises Concern

Video calls on Indonesians to join Islamic State of Iraq and the Levant, ISIL More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
In Thailand, Some Efforts to Improve Conditions For Migrant Laborersi
X
Steve Herman
August 01, 2014 6:22 PM
Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video In Thailand, Some Efforts to Improve Conditions For Migrant Laborers

Thailand has been facing increasing international scrutiny as a hub of human trafficking and slave labor. Some of the kingdom’s companies are striving to improve working conditions, especially for the millions of migrant laborers from surrounding countries. VOA Correspondent Steve Herman in Bangkok takes a look at one initiative for children at construction sites
Video

Video Public Raises its Voice on Power Plant Pollution

In the United States, proposed rules to cut pollution from the nation’s 600 coal-fired power plants are generating a heated debate. The U.S. Environmental Protection Agency, charged with writing and implementing the plan, has already received 300,000 written comments. As VOA’s Rosanne Skirble reports, another 1,600 people are lining up this week at EPA headquarters and at satellite offices around the country to give their testimony in person.
Video

Video Information War Rages Alongside Real One in Ukraine

The downing of the Malaysian airliner two weeks ago, and allegations that Russians are shelling Ukrainian troops across the border, have moved the information war swirling around the Ukrainian conflict to a new level. VOA's Al Pessin reports from Kyiv.
Video

Video When Fighting Eases, Gazans Line Up at Bakeries

When there is a lull in the conflict in Gaza, residents who have been hunkered down in their apartments rush out to stock up on food and other necessities. Probably the most important destination is the local bakery. VOA’s Scott Bobb reports from Gaza City.
Video

Video China Investigates Powerful Former Security Chief

The public in China is welcoming the Communist Party's decision to investigate one of the country's once most powerful politicians, former domestic security chief Zhou Yongkang. Analysts say the move by President Xi Jinping is not only an effort to win more support for the party, but an essential step to furthering much needed economic reforms and removing those who would stand in the way of change. VOA's Bill Ide has more from Beijing.
Video

Video US-Funded Program Offers Honduran Children Alternative to Illegal Immigration

President Obama and Central American leaders recently agreed to come up with a plan to address poverty and crime in the region that is fueling the surge of young migrants trying to illegally enter the United States. VOA’s Brian Padden looks at one such program in Honduras - funded in part by the United States - which gives street kids not only food and safety but a chance for a better life without, crossing the border.
Video

Video 'Fab Lab' Igniting Revolution in Kenya

The University of Nairobi’s Science and Technology Park is banking on 3-D prototyping to spark a manufacturing revolution in the country. Lenny Ruvaga has more for from Nairobi's so-called “FabLab” for VOA.
Video

Video Immigrant Influx on Texas Border Heats Up Political Debate

Immigrants from Central America continue to cross the U.S.-Mexico border in south Texas, seeking asylum in the United States, as officials grapple with ways to deal with the problem and provide shelter for thousands of minors among the illegal border crossers. As VOA's Greg Flakus reports from Houston, the issue is complicated by internal U.S. politics and U.S. relations with the troubled nations that immigrants are fleeing.

AppleAndroid