Egypt’s Foreign Debt Decreases by $7.4 Billion in Q1 2024

#Finance
Egypt’s Foreign Debt Decreases by $7.4 Billion in Q1 2024

Loveworld / 5 hours

August 23, 2024

2 min read

In the first quarter of 2024, Egypt achieved a notable reduction in its foreign debt, which fell by $7.4 billion. According to data released by the central bank, Egypt’s total foreign debt decreased from $168 billion at the end of December 2023 to $160.6 billion by the end of March 2024. This reduction follows a decline from $164.5 billion at the end of September 2023.
A key factor contributing to this significant debt reduction was the sale of development rights to prime Mediterranean land at Ras El-Hekma to the UAE for $35 billion in late February. This substantial influx of funds has bolstered Egypt’s financial position, enabling it to reduce its foreign debt.
Additionally, in March, Egypt secured an $8 billion financial support package from the International Monetary Fund (IMF). This agreement includes a commitment to a free-floating currency and has already seen the IMF disburse an initial $820 million, with the remainder to be released in semi-annual installments until September 2026.
As of the end of March, Egypt’s foreign debt was equivalent to 39.8% of its Gross Domestic Product (GDP), down from 43% in December. The reduction in the debt-to-GDP ratio reflects improved debt management and financial stability.
Since 2015, Egypt’s external debt had quadrupled to fund various projects, including the development of a new capital, infrastructure, and other key expenditures. The recent debt reduction and IMF support mark significant steps toward managing and stabilizing Egypt’s financial future.