File Photo: Egypt s Central Bank. Al-Ahram
Egypt has been facing heavy pressure on its budget since the onset of the war in Ukraine that led to the exodus of $25 billion in hot money from the local market.
According to recent data published by the Central Bank of Egypt (CBE), Egypt’s external debt declined in the 1Q of FY2022/2023 (July-September 2022) to $154.9 billion, down from $155.7 billion seen at the end of FY2021/2022.
Under its Extended Fund Facility with the International Monetary Fund (IMF), Egypt has committed to attaining a primary surplus of 1.7 percent of GDP in current FY 2022/23, 2.1 percent in FY 2023/24 and 2.3 percent in FY 2024/25 and FY 2025/26, in order to reduce the gross debt-to-GDP ratio by around 83 percent by FY 2026/27.
The government has also pledged to adopt corrective measures, including making stronger fiscal adjustment through expenditure rationalisation, exerting additional efforts in revenue mobilisation, and selling public assets in case debt levels surpass the target of reducing debt.
In this respect, the government has committed to a ceiling on the gross debt of 92.1 percent of GDP by the end of the current fiscal year by the end of June.