The size of Egypt’s foreign debt for the fiscal year (FY) 2015/2016 increased by $7.7bn to register $55.76bn at the end of June 2015, up from $48.062bn, according to the Central Bank of Egypt (CBE).
The CBE announced on its website that the size of foreign debt increased in the FY’s fourth quarter by $2.3bn alone.
Furthermore, the size of long-term foreign debt this year increased by $3.25bn to reach $48.74bn at the end of June 2016.
The size of short-term debt grew by $4.44bn to record $7.01bn, up from $2.57bn.
“The size of debt owed by the government reduced by about $1.2bn, to reach $24.43bn in June 2016 compared to $25.70bn in June 2015,” the CBE stated. “These loans are due on the medium- and long-term and are divided by $3.49bn in treasury bonds and bills and $20.94bn in loans.”
The CBE’s debts increased by $5.856bn, reaching $22.17bn in June 2016, of which $1.3bn was payable in the medium -and long-term, and $3.2bn in the short-term.
Meanwhile, debts owed by banks jumped up by $1.5bn, registering $3.96bn in June 2016, compared to $2.38bn in June 2015.
Ezz El-Din Hassanein, a banking and economic expert and general manager at a bank operating in Egypt, said that resorting to borrowing, from abroad or from domestic borrower, comes on the back of the chronic deficit the state is suffering from.
He stressed that this forms an endless spiral, especially in light of declining state revenues. “Revenues are not expected to grow in the short term to cut on borrowing and dilute the deficit,” he added.