Egypt’s foreign reserves declines due to foreign debt dues

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The Central Bank of Egypt said the greenback reserve with USD 1.63 billion in May, recording USD 35.4 billion compared to USD 37.1 billion in April 2022. CBE’s statement added that the decline resulted from the due payoffs of the sovereign foreign debts estimated at USD 2 billion in May, which included dues related to the treasury bills issued by the Egyptian Treasury and loans from the International Monetary Fund as well as other parties.

However, CBE emphasised that the current foreign reserve is sufficient to cover the countries’ import needs over the next five months. Earlier, CBE declared last April that the foreign debt recorded USD 145.529 billion in December 2021 compared to 123.490 billion in December 2020. This 17% increase preceded the Ukrainian war, which is expected to pressure the Egyptian governmental budget. Accordingly, Standard & Poor’s prospected Egypt to be the largest importer of sovereign debts among the emerging economies in Europe, the Middle East and Africa, with USD 73 billion in issuances this year.