Egypt’s foreign debt reached US$48.062 billion at the end of the 2014/15 Fiscal Year, exceeding the nation’s debt levels in the early 1990s.
Foreign debt last exceeded $47 billion in 1991, when the United States and its allies rewarded Egypt for its support in the Gulf War with a debt forgiveness package covering almost $20 billion of the nation’s foreign liabilities.
Following the relief package, Egypt’s debt continued to rise through the 1990s and early 2000s, and has soared since the 2011 revolution.
At the end of the 2009/10 Fiscal Year, which preceded the January 25 revolution, the country’s gross external debt stood at $33.7 billion.
According to figures released this week by the Central Bank of Egypt, the bulk of the rise in debt during 2014/15 came in the fourth quarter of the fiscal year, which spanned March to June 2015. At the end of March, external debt stood at $39.85 billion, compared to more than $48 billion by the end of June.
Debt rose across almost all categories, but most of the increase appears to be due to a combined $6 billion worth of Central Bank deposits in April by Kuwait, Saudi Arabia and the United Arab Emirates.
This corresponds with an increase in Egypt’s long-term deposit liabilities, which jumped from $9 billion in March 2015 to $15 billion in June 2015.
Egypt’s increasing indebtedness comes despite an increase in the amount of debt that has been paid off. The country spent more than $5.6 billion servicing its debts in 2014/15, compared to $3.2 billion in 2013/14 and $2.6 billion in 2009/10.
On the upside, external debt as a percentage of GDP fell during the year, from 16.4 percent in 2013/14 to 15 percent in 2014/15. In 1990/91, when debt last approached $48 billion, that amount was equivalent to more than 100 percent of the country’s annual GDP.
Egypt’s foreign debt is dwarfed by its domestic liabilities, which exceeded LE2 trillion in March 2015 (equivalent to almost $259 billion at official exchange rates). The Central Bank has not yet released domestic debt figures for the full 2014/15 Fiscal Year.