The International Monetary Fund (IMF) predicted that the external debt curve of the Arab Republic of Egypt will peaked in the current fiscal year and that the decline will begin in the next fiscal year.
According to the IMF report on the fourth review of the economic program, the external debt will reach 104.4 billion dollars this fiscal year, against 93.1 billion dollars in September 2018. While the external debt will fall during the next fiscal year to 95.2 billion dollars, expected to reach 31.3% of the GDP, compared to 35.4 percent.
In parallel, the research sector at Hermes Investment Bank announced that the rise in the external debt was expected by the government and the Fund is in light of the trend towards the external borrowing as an alternative to the domestic borrowing because the implementation of the economic reform program led to higher inflation rates and thus increase interest rates to meet these high levels.
Hermes also predicted that the Egyptian central bank will resort to another rate cut by September of 2% after implementing the new phase of the economic reform program related to the increase of prices of fuel and electricity.
Source: (Bourse News Website, Edited)
