Egypt's external debt soared by 5.1 per cent during the fourth quarter of 2022, reaching $US 162.94 billion. This is US$10 billion more than the previous quarter, according to recent data run by the Egyptian of Planning and Economic Development.
The country's economy has been hit hard by the Covid-19 pandemic and the Ukrainian-Russian war, factors that massively disrupted global markets and pushed up oil and food prices worldwide.
Egypt has been committed to maintaining a primary surplus of 1.7 per cent of gross domestic product (GDP) in the fiscal year 2022/23, 2.1 per cent in FY 20 23/24 and 2.3 per cent in FY 2024/25 and FY 2025/26 to reduce the gross debt-to-GDP ratio by around 83 per cent by FY 2026/27 as per an extended fund facility offered by the international monetary fund (IMF).
In October last year, the central bank of Egypt an exchange rate flexibility, allowing the value of the Egyptian pound to be regulated by market forces in a bid to save an already ailing economy after securing a US$3 billion loan from IMF.
Experts recently predicted that the Egyptian government will likely devaluate the pound against the US dollar for the fourth time amid the current economic crisis.
The Egyptian pound has already been against the US dollar leading prices to hike, especially since Egypt depends on importation rather than local production. US$1 is valued at 30.95 EGP at the time of publishing.