The Ministry of Finance in co-operation with the Central Bank have managed to allocate $318 million, which represents the value of public debt instalments owed by the government for bonds issued abroad in Egyptian pound in 2007.
A high-ranking source in the Ministry of Finance has affirmed the government’s commitment to the settlement of all instalments owed at their scheduled time.
The government plans to capitalise on such step by lobbying international credit rating organisations in the hopes of improving their perception of the condition of Egyptian economy as well as raising the country’s credit rating from B+ to B++.
Doing so would be a strong indicator to the return of foreign direct investment to Egypt and hence, a better chance for expedited economic development.
The source added that raising Egypt’s credit rating would be supported by the reduction of external debt in addition to the government’s plans to achieve higher rates of economic development and better efficiency of the banking sector.
The gross value of governmental debts, whether owed by the government or public sector commercial banks, represented 99.9% of the country’s total external debt at the end of 2011.
The Government owes EU member countries a total of $10.8 billion, with Germany owed the largest sum, valued at $3.8 billion, followed by France, which is owed $3.7 billion, the European Investment Bank owed $2 billion, with the IMF owed $1.4 billion.
Loans from Japan are worth $4.2 billion; the US is owed $3.1 billion in addition to loans from Arab countries, which are valued at $1.6 billion.
During last year, the government has succeeded in settling $1.7 billion of its outstanding external debts.