Egypt Watch

Egypt’s foreign exchange reserve down to $33bn

Thursday, the Central Bank of Egypt said Egypt’s foreign exchange reserves decreased by $2.12 billion in June, reaching $33.375 billion.

CBE announced last month that the reserve decreased by $1.63 billion in May, reaching $35.5 billion, compared to $37.1 billion in April 2022.

According to CBE, the reasons for the decline are due to external debt payments, estimated at about $2 billion. It also revealed a decline in net reserves in April by about $3.912 billion, after declining from $40.994 billion in February to about $37.082 in March. In the same month, it announced that the external debt rose by $22 in one year, at a rate of approximately 17.9%, reaching $145 billion and 529 million in December 2021, compared to $123 billion and 490 million in December 2020. External debt in last year’s last quarter witnessed a rise of $8.109 billion, representing an increase of 5.9% in three months.

The new increase in foreign debt came before the Russian war on Ukraine, which led to a decline in foreign exchange flows from several sources, especially tourism and foreign investments in government bills and bonds. S&P Global Ratings had issued a report in which it expected Egypt to become the largest issuer of sovereign debt among emerging markets in Europe, the Middle East and Africa, with issuances amounting to $73 billion this year.