Egypt repays $700M to Paris Club last week

CAIRO – 12 July 2017: Egypt has paid back $700 million in the last week as a six-month installment on the foreign debt owed to the Paris Club, a senior banking official told Egypt Today on Tuesday.

Egypt's total debt to the Paris Club dropped to about $3.4 billion at the end of December, down from $3.6 billion at the end of September, according to the Central Bank of Egypt’s (CBE) quarterly report.

The Paris Club is an informal group of financial officials from 19 of the world’s largest economies. The group provides financial services, including debt restructuring relief and cancellation, to indebted countries and their creditors.

In January, Cairo repaid a $670 million six-month premium on the foreign debt owed to the Paris Club.

Egypt's foreign debt jumped to $67 billion at the end of December from $48 billion at the end of December 2015, marking a 40 percent increase of $19 billion, according to the CBE.

The total amount of Egypt’s external obligations has doubled since 2010, when they stood at $34.7 billion.

To bridge an increasing fiscal gap in the state budget, the Egyptian government had to expand its direct borrowing from several countries and international financial institutions, in addition to issuing dollar-denominated bonds in international debt markets.

Since November, Egypt has received $2.75 billion of a $12 billion loan from the International Monetary Fund, $2 billion from the World Bank, $1 billion from the African Development Bank, $1 billion from the United Arab Emirates and $2 billion from Saudi Arabia.