CAIRO: According to a official report from the Cabinet of Egypt, the country’s foreign debt has declined for the first time in more than four years.
The report revealed that Egypt’s external debt decreased in the first quarter of 2020 by 1.2 percent, compared to the previous quarter.
The total external debt registered an increase of 9.9 percent during the first quarter of 2019, compared to the previous quarter.
“It also recorded 6.4 percent in the first quarter of 2018, compared to the previous quarter; 9.8 percent in the first quarter of 2017, compared to the previous quarter; and 11.8 percent in the first quarter of 2016, compared to the previous quarter,” the report said.
The report showed that the ratio of short-term debt to total external debt decreased, reaching 9.3 percent in the first quarter of 2020, compared to 11.7, 13, 17.1 and 12.8 percent in the first quarters of 2019, 2018, 2017 and 2016 respectively.
It also showed a decrease in the ratio of short-term debt to net international reserves, which reached 25.7 percent in the first quarter of 2020, compared to 28.1, 27, 44.2 and 41.3 percent in the first quarters of 2019, 2018, 2017 and 2016 respectively.
The report attributed the improvement in the performance of the external debt in Egypt to the success of the economic reform program, represented by a 10.7 percent decline in the dollar exchange rate against the Egyptian pound to reach 15.8 pounds at the end of September 2020, compared to 17.7 pounds at the end of September 2017. Also contributing to the success was an increase in foreign exchange reserves by 6.4 percent, reaching $38.4 billion in August 2020, compared to $36.1 billion in August 2017.
Another factor related to the improvement was the increase in tourism revenues, which rose by 76.9 percent to reach $2.3 billion during the first quarter of 2020, compared to $1.3 billion during the same quarter of 2017.
The increase in remittances from Egyptians working abroad, which rose by 36.2 percent to reach $7.9 billion during the first quarter of 2020, compared to $5.8 billion during the same quarter of 2017, likewise contributed positively.
This is in addition to an increase in merchandise exports by 21.8 percent, reaching $6.7 billion during the first quarter of 2020, compared to $5.5 billion during the same quarter of 2017.
Suez Canal revenues increased by 16.7 percent to reach $1.4 billion during the first quarter of 2020, compared to $1.2 billion during the same quarter of 2017.
