Egypt returns money to Qatar

Egypt gave back US$500 million of a Qatari deposit on November 1 and will return another $500 million at the beginning of December, a source at the Central Bank told Reuters.

Qatari support for the Egyptian government outdid other countries while former President Mohamed Morsi was in power. How the return of the deposit will affect the economy remains unclear. Since Morsi was deposed on July 3, Saudi Arabia, the United Arab Emirates, and Kuwait each gave $4 billion in aid to Egypt, outstripping Qatari aid.

Total Qatari aid over the past two years had amounted to $8 billion. It provoked the ire of opponents of Morsi's Muslim Brotherhood, and Qatar was vilified in mass protests against Morsi’s presidency in July.

The Central Bank source did not elaborate on the reasons behind the return of the money, or cite any political rationale for Qatar’s decision not to renew the deposit when it matured.

In September, Egypt returned $2 billion in aid after talks to convert them into bonds failed. It was not clear the issue was technical or political. The Head of the Central Bank, Hisham Ramez, said that Qatar had agreed earlier to convert aid into bonds, but was going back and forth on the timeframe, compelling Egypt to simply pay the deposit back.