North Africa/Middle East

Lebanon’s caretaker government Wednesday approved opening credit lines totaling $116 million to help fix its crippled state electricity grid, the Associated Press reported. The cash-strapped country for over two years has struggled with rampant power cuts that have crippled much of public life, worsening a broader economic crisis that has pulled over three-quarters of the country’s population into poverty. Today, households only receive about an hour of state electricity per day, with millions now relying on expensive private generator suppliers to power their homes.

Egypt plans to cut spending after the International Monetary Fund extended hundreds of millions of dollars in an economic bailout package, as the country struggles to pay off debts accumulated from a decadeslong building boom, the Wall Street Journal reported. Authorities said earlier this week they would delay state projects that required significant U.S. dollars to fund and cut back on travel, training and conferences for officials, according to Egypt’s cabinet.

Pakistan’s prime minister said Thursday that the United Arab Emirates agreed to extend a $2 billion loan to his country and provide an additional $1 billion as his nation struggles to recover from devastating floods this summer and a dire economic crisis, the Associated Press reported. Prime Minister Shahbaz Sharif’s office made the announcement after he met with the leader of the UAE, Abu Dhabi ruler Sheikh Mohammed bin Zayed Al Nahyan.

The Egyptian pound fell to yet another record low, a sign that authorities are pressing ahead with a shift to more flexible currency trading, Bloomberg News reported. The currency slumped as much as 14% to 32.1 per dollar before paring losses to close at 29.8 on Wednesday, capping the largest single-day drop since late October. That’s narrowed the gap against prices quoted in the black market, the so-called parallel exchange rate of about 31, according to traders.

Saudi Arabia said Tuesday that it was considering providing up to $11 billion to Pakistan, a potential lifeline to a country facing default, the Wall Street Journal reported. The United Arab Emirates and Qatar in recent months have said they might also offer help to Pakistan, with potential loans and investments from Gulf nations now totaling at least $22 billion after the latest announcement from Riyadh. Gulf countries have said they could extend a similar level of support to Egypt, which is also struggling economically.

Prices for staples such as meat, clothing, travel and medicine have been rising as the Egyptian pound fell 36.5% last year against the U.S. dollar, making it the third-worst-performing currency in the world after the Sri Lankan rupee and the Argentine peso. Inflation hit nearly 19% in November and economists expect it to rise to 25% by March, the Wall Street Journal reported. As prices surged, it became more expensive for the government to import food, sparking hoarding. Government officials have said that bread, rice and cooking oil have been missing from some store shelves.

The Egyptian pound plunged to a record low on Wednesday as authorities navigate the country’s worst foreign-exchange crunch in half a decade, Bloomberg News reported. The currency headed for its biggest slump since a devaluation in October with a slide of as much as 7% to about 26.5 per dollar in the offshore market, before trimming some losses, according to data compiled by Bloomberg. That still leaves the pound stronger than prices offered in the black market. “This is certainly another devaluation,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank.

The International Monetary Fund has approved a deal that will provide a $3 billion support package to cash-strapped Egypt over a period of almost four years, with the agreement expected to draw in an additional $14 billion in financing for the Middle East country, the Associated Press reported. The announcement from the IMF’s executive board late on Friday comes after a preliminary agreement was reached in October between Egypt and the fund.

A U.S. court of appeals determined this week that cases against Lebanese commercial banks can be tried outside Lebanon, according to a decision seen by Reuters, paving the way for more cases by depositors seeking to unlock their frozen funds, Reuters reported. The court decision, issued on Dec. 15 in a case brought by Lebanese depositors against leading lender Bank Audi, overturned a lower district court's decision that said Beirut courts had "exclusive jurisdiction" to try cases against Lebanese banks.

The head of Israel's powerful parliamentary finance committee submitted a bill on Monday that would limit banks' ability to raise mortgage rates after central bank interest rate increases, Reuters reported. The Bank of Israel has raised its benchmark interest rate by 3.15 percentage points to 3.25% since April, with more hikes likely. Monthly mortgage repayments have soared by more than 1,000 shekels ($291), with high inflation an additional factor.