Egypt Seeks to Reduce Foreign Debt by 6%

Newspaper Title: Al Sharq Al Awsaat

Newspaper Number:

Tuesday - 27 February 2018

Minister of Finance Amr al-Garhy said on Monday that Egypt aims to reduce foreign debt from 41 percent in fiscal year 2016/2017 to 35 percent by the end of this fiscal year to reach 30 percent in 2018/2019.

During his speech at the American Trade Chamber (AmCham) in Cairo, Garhy said that the improvement of economic indicators in the country noticeably positively impacted the development and improvement of the trade balance, stability of the exchange market and drop in the budget deficit.

The purchase requests reached around $12 billion in the last issuance in London last week, Garhy added. He said that foreign investment increased to $20 billion, which confirmed the trust of foreign investors in the Egyptian economy and its stability.

Beltone Financial expected in a recent report, a copy of which was obtained by Asharq Al-Awsat, that decreasing the budget deficit to 10 percent of gross domestic product (GDP) requires the accumulation of foreign debt to 35 percent in the fiscal year 2016/2017.

According to the report, oil prices will increase to reach $63 per barrel in fiscal year 2017/2018, which creates a challenge for reducing energy subsidies.

Beltone Financial said that the decline in the Egyptian inflation supports a more expansive monetary policy. The report expected that direct foreign investments and the recovery of consumption rates will lead the growth rates of fiscal year 2017/2018.