CAIRO: Egypt is set to pay back around $1.7 billion of its foreign debt during the 2nd half of 2015, despite heavy pressure on the country’s foreign reserves,” a senior government official told Youm7 Monday.
Earlier in January, the Central Bank of Egypt (CBE) repaid a $700 million premium to the Paris Club, 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.
“Egypt will repay $700 million premium to the Paris Club in July and $1 billion worth of treasury bonds owed to Qatar in the 4th quarter of 2015,” the source told Youm7.
He added, “timely repayment of foreign debt premiums is a top priority for the CBE in spite of the tough economic circumstances in Egypt.”
The foreign reserve allows the government to purchase basic commodities, such as wheat and petroleum products, and to pay off premiums and interest on foreign debts.
Foreign reserves witnessed a sharp slip due to low revenues from tourism and foreign direct investment (FDI) since the 2011 revolution, when they were valued at $35.8 billion. Last week, the CBE announced that foreign reserves rose to $15.43 billion at January-end, up from $15.33 billion at the end of December.
Meanwhile, it is expected that foreign reserves would see a significant improvement in the coming period as Egypt is slated to receive $10 billion in deposits from Saudi Arabia, Kuwait and the United Arab Emirates prior to the Egypt Economic Development Summit scheduled in March, Youm7 reported Wednesday.
Also, the government is set to offer mega investment projects during the Economic Summit scheduled in March to lure fresh investment.