PM reviews efforts to reduce public debt in Egypt

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Egypt’s Prime Minister Mostafa Madbouly met with Finance Minister Ahmed Kouchouk on Wednesday to discuss the country’s ongoing efforts to reduce public debt, maintaining its downward trajectory as a percentage of GDP.

A Wednesday press statement by the Cabinet indicated that the meeting focused on the government’s commitment to reducing public debt and sustaining a sustainable fiscal path.

“The Prime Minister stressed that the government has already begun to reduce external debt levels in recent months and is determined to continue this approach in the medium and long term,” said Mohamed El-Homsani, spokesperson for the Cabinet.

“This commitment is being achieved while ensuring Egypt’s full commitment to meeting its debt payment obligations on time.”

The meeting also focused on the government’s commitment to achieving fiscal discipline to ensure that government debt as a percentage of GDP continues on its planned downward path.

Egypt’s overall debt declined by the end of the fiscal year (FY) 2023/24, which ended on 30 June, to 89% of the GDP, down from 95.7% at the end of FY 2022/23, according to July’s fiscal monthly report published by the Ministry of Finance.

The Finance Minister outlined his comprehensive program for reducing government debt in the medium term, including reducing debt costs, diversifying investor bases and currencies, and extending debt maturities to bolster confidence in the Egyptian economy.

“The Finance Minister presented a series of proposals to reduce the internal debt of government agencies and a number of measures to achieve the state’s objectives in this regard,” said El-Homsani.

Egypt pledged to decrease the debt level to below 80% by 2027, in line with its commitments under the International Monetary Fund’s (IMF) programme. The government also plans to bring the debt-to-GDP ratio down to 88.2% in the current FY 2024/25, which ends on 30 June 2025.