Egypt’s public debt is projected to decline steadily to its lowest level in more than a decade, according to the International Monetary Fund’s Fiscal Monitor released on October 15. The report forecasts Egypt’s debt-to-GDP ratio to drop from 90.9% in FY2023/24 to 87% in FY 2025/26, reaching 72.5% by FY2029/30, marking the lowest since 2016.
The IMF credited the trend to the government’s “Narrative for Economic Development”, led by Prime Minister Mostafa Madbouly, which prioritises fiscal discipline, reduced borrowing, and stronger domestic production. The plan aligns with Egypt’s medium-term debt strategy targeting a gradual but sustained fiscal consolidation.
However, the Fund cautioned that Egypt’s external financing needs remain high—set to peak at $30.4 billion before easing to $27.5 billion, with a projected financing gap of $8.2 billion in FY 2025/26. It warned that regional instability and tight global financial conditions could strain the outlook.
Economist Dr Lina Hassan said the decline “is only meaningful if paired with real economic growth,” while analyst Karim El-Masry noted that “maintaining credibility in debt markets will be Egypt’s biggest test.”
Globally, the IMF warned that public debt could surpass 100% of world GDP by 2029, making Egypt’s progress notable. A senior Finance Ministry official stated that Cairo is finalising a debt-swap deal with European partners before the end of 2025 to extend maturities and lower costs.
If sustained, Egypt’s current trajectory could transform it from one of the region’s most indebted economies into a model of fiscal recovery—proof that consistent reform and “smart spending,” as the IMF phrased it, can turn vulnerability into resilience.
