Egypt aims to cut its external debt to 40 per cent of gross domestic product (GDP) by the end of the current fiscal year, down from 44 per cent last year, Prime Minister Moustafa Madbouly said Wednesday. Speaking at a weekly press briefing, Madbouly said the government, in coordination with the Central Bank of Egypt (CBE), is pursuing strategies to lower both domestic and foreign debt. Measures include careful new borrowing, debt refinancing, and converting existing debt into development projects. "We are within the safe limits for middle-income countries, but our target is 40 per cent, and we are exploring ways to go even lower," Madbouly said. He noted that new borrowing is primarily focused on essential state needs, such as fuel and food supplies. Debt substitution, he explained, allows the government to replace maturing high-interest loans with new debt on more favorable terms, extending repayment periods without increasing the total debt burden. Madbouly also highlighted Egypt's success with debt-for-investment swaps, where foreign debt is redirected to fund development projects that benefit citizens. Egypt is one of only seven countries worldwide to successfully implement such initiatives, he said. The prime minister emphasised that ongoing economic growth of around 5 per cent, monetary stability, and strong foreign currency reserves will help the country maintain fiscal sustainability while reducing its external debt. Attribution: Amwal Al Ghad English
