Ahmed Kjok, Deputy Minister of Finance for Fiscal Policies, said that despite the increase in the average global indebtedness of emerging countries to 17% and major countries to 20% during the pandemic, the debt-to-GDP ratio in Egypt witnessed a very slight increase that did not exceed 1% despite the expansion of major national and development projects. In all aspects of life, increasing public investment allocations, extending the umbrella of social protection, improving wages, increasing health and education allocations, and accelerating the implementation of the comprehensive health insurance system; As a major tool for reforming the health system in Egypt.
He added during the workshop, which was organized in cooperation with the Macroeconomic Reform and Stability Project of the United States Agency for International Development (USAID), that we are aiming to sustain the downward path of the debt rate of the domestic product as of the current fiscal year, by proceeding with the implementation of the public debt management strategy that is based on Diversify the sources of financing, extend the life of the debt, and reduce the cost of financing.
He pointed to Egypt’s recent success in issuing the first offering of dollar bonds in three tranches of 6, 12 and 30 years, with good interest rates lower than those achieved in May 2020, where the coverage ratio was 3 times of the value of the offering; This reflects the increasing demand from foreign investors and their confidence in the capabilities of the Egyptian economy.
He pointed out that debt service decreased from 40% of the budget in June 2020, to 36% in June 2021, and we are targeting 32% in the current fiscal year budget.