In the most recent monthly report, the Ministry of Finance has just announced that Egypt has effectively reduced its debt-to-GDP ratio during the previous fiscal year (FY2023/2024), decreasing to 89 percent from 95.7 percent in FY2022/2023. Looking forward, the government aims to achieve a further reduction to 88.2 percent of GDP by the conclusion of FY2024/2025.
The nation’s initiatives to reduce its debt-to-GDP ratio are in line with Egypt’s objective of achieving a debt below 80 percent of the GDP by 2027 with the support of the International Monetary Fund (IMF) loan program. Domestic debt declined to 66.7 percent of GDP from 70.5 percent in FY2022/2023, while external debt decreased to 22.3 percent in FY2023/2024 from 25.2 percent.
In the fiscal year of FY2023/2024, Egypt’s debt servicing constituted a significant portion of its fiscal responsibilities, accounting for nearly 60 percent of total revenues and expenses, marking a notable increase from approximately 25 percent in FY2023/2024.
According to Egypt today the report indicates that Egypt’s debt servicing surpassed LE 1.1 trillion in FY2023/2024. During the same period, revenues amounted to LE 2.1 trillion, representing 18.1 percent of the GDP, a growth from LE 1.6 trillion (15.5 percent of GDP) in FY2022/2023. The substantial increase in tax revenues, reaching LE 1.5 trillion from approximately LE 1.2 trillion in the previous year, significantly contributed to this uptrend.
In FY2023/2024, the expenditures rose to nearly LE 3 trillion, constituting 25.3 percent of the GDP, which represents the highest level in the past five fiscal years. This is in comparison to the figures from FY2022/2023, which recorded expenditures at LE 2.1 trillion, constituting 21.6 percent of the GDP.
According to reports from various media sources, government officials have indicated that Egypt’s external debt decreased to $153.86 billion by the end of May 2024, down from the $168.03 billion reported in December 2023, marking an 8.43 percent reduction.
