– Experts view the recent reduction in Egypt’s external debt as a positive sign of effective management of the country’s foreign liabilities, with the Central Bank of Egypt (CBE) reporting a decline from $168.034 billion in December 2023 to $160.607 billion in March 2024.

– Mohamed Abu Basha, Chief Economist at EFG Hermes, highlighted that this debt reduction reflects effective fiscal policies and strategic management, potentially boosting investor confidence and positively impacting Egypt’s credit ratings.

– Simon Williams, Chief Economist at HSBC, noted that continuous monitoring and prudent economic policies are crucial to maintain this trend.

Experts view the recent announcement on the reduction in Egypt’s external debt as a positive indication of managing the country’s foreign liabilities. However, they emphasize that continuous monitoring will be crucial to maintain this trend.

The Central Bank of Egypt (CBE) reported a reduction in Egypt’s external debt, now at $160.607 billion as of March 2024. This marks a decrease from $168.034 billion in December 2023, a decline of $7.427 billion.

According to the CBE’s report released recently, long-term external debt fell to $135.257 billion in March 2024, down from $138.551 billion in December 2023. Short-term debt also declined, standing at $25.350 billion, compared to $29.482 billion previously.

Mohamed Abu Basha, Chief Economist at EFG Hermes, stated, “The reduction in Egypt’s external debt reflects effective fiscal policies and strategic management of the country’s foreign liabilities. This decline can bolster investor confidence and positively impact Egypt’s credit ratings.”

The government’s outstanding external debt similarly decreased, reaching $82.206 billion in March 2024, down from $84.849 billion in December 2023. All of this debt is categorized as long-term.

“This decrease in external debt is a significant achievement and aligns with our long-term economic reform program. It demonstrates the government’s commitment to sustainable economic growth and financial stability,” said Rania Al-Mashat, Egypt’s Minister of International Cooperation.

The Central Bank’s outstanding debt dropped from $45.314 billion to $41.119 billion during the same period. This includes $41.119 billion in long-term debt and $15.953 billion in short-term debt.

Bank debt totaled $20.120 billion, slightly down from $20.096 billion, with $15.548 billion in long-term debt and $4.572 billion in short-term debt.

Other sectors’ outstanding external debt was approximately $12.337 billion by the end of March 2024, down from $12.642 billion in December 2023. This includes $12.337 billion in long-term debt and $4.824 billion in short-term debt.

The reduction in Egypt’s external debt is partly due to the UAE waiving $11 billion in dollar deposits held by the Central Bank of Egypt. This waiver is part of a broader $35 billion agreement for the Ras El Hikma development project on the Mediterranean coast.

Simon Williams, Chief Economist for Central & Eastern Europe, Middle East, and Africa at HSBC, commented, “The reduction of $7.427 billion in external debt is a positive indicator for Egypt’s economy, suggesting improved external balances and successful debt restructuring efforts. However, continuous monitoring and prudent economic policies will be crucial to maintain this trend.”