Foreign Office circles said today that a $49 million credit arrangement for Egypt announced here last night represented a new basis for trade with that country in response to the improved political climate between Britain and Egypt. The circles said newspaper reports describing the deal as “a new loan” were wrong. They said arms deals are a separate issue and have nothing to do with the new credit line.
The government will guarantee credits for Egypt up to $49 million between now and 1976 enabling Cairo to use some $11-$12 million a year. The credits are extended by suppliers of goods purchased by Egypt and the government’s role is merely that of guarantor, the Foreign Office sources said. Hitherto, export credits for Egypt were made available only after repayment of outstanding debts. The new credits will be extended irrespective of whether previous commitments have been met, the sources said.
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