The European Union has announced a 7.4 billion euro funding package and improved relations with Egypt as part of an effort to stem migrant flows to Europe that have been criticized by rights groups.

The deal, which elevates the European Union’s relationship with Egypt to a “strategic partnership,” was announced during a delegation of leaders’ visit to Cairo.

It is designed to boost cooperation in areas such as renewable energy, trade and security, while providing grants, loans and other funding over the next three years to support Egypt’s economy.

The proposed funding includes 5 billion euros in soft loans and 1.8 billion euros in investments, according to a summary of the plan released by the EU.

In addition, 600 million euros will be provided in the form of grants, including 200 million euros for solving migration issues.

European governments have long been concerned about the risk of instability in Egypt, a country of 106 million people struggling to attract foreign currency and where economic problems have pushed more people to migrate in recent years.

Inflation has reached record levels, and many Egyptians say they are struggling to make ends meet. Last month, however, financial pressure on the government eased as Egypt struck a record investment deal with the United Arab Emirates, expanded its lending program with the IMF and sharply devalued its currency.

Diplomats say Egypt’s strategic importance has been underscored by the war in Gaza, where Egypt is trying to mediate between Israel and Hamas and increase aid supplies, and by the conflict in neighboring Sudan, which has caused the country’s biggest displacement crisis in the world.

European Commission President Ursula von der Leyen led a delegation meeting with President Abdel Fattah al-Sisi in Cairo on Sunday, which also included the prime ministers of Italy, Greece, Austria and Belgium and the president of Cyprus.

Egypt’s finance minister said the government has committed a total of $20 billion in multilateral support following increased lending and an economic reform program with the IMF.

The biggest chunk of EU funding has been allocated recently and has been developed in close cooperation with the IMF, €1 billion of “macro-finance” credit financing will be provided this year, a senior European Commission official said.

The remaining 4 billion euros are subject to the approval of the European Parliament, the official added.

The number of migrants from Greece to the West has increased

Egyptian officials say Egypt deserves credit for significantly halting illegal migration from its northern coast since 2016, although there has been an increase in the number of Egyptians trying to cross into Europe via Libya, and the European Union is already offering support to reduce those flows.

In recent months, the Greek islands of Crete and Gavdos have seen a significant increase in the number of migrants arriving mainly from Egypt, Bangladesh and Pakistan, raising concerns about a new Mediterranean smuggling route.

Activists have criticized Western support for Sisi, who came to power a decade ago after leading the overthrow of Egypt’s first democratically elected leader. The crackdown has gripped dissidents across the political spectrum, while the state and military have expanded their grip on the economy, which businessmen and analysts say have hindered structural reforms called for by the IMF.

Sisi’s supporters say the security measures are needed to stabilize Egypt and pave the way for social rights such as housing and jobs.

The EU says its expanded partnership with Egypt aims to promote democracy and freedoms, but its moves to provide funding in return for curbs on migration to other countries, including Tunisia, have faced obstacles and criticism.

“The plan is the same as the EU’s flawed deals with Tunisia and Mauritania: stop migrants, ignore abuses,” Human Rights Watch said of the plan to strengthen ties with Egypt and provide new funding.