Egypt’s external debt rose to $163.7 billion at the end of September 2025, up $2.5 billion from three months earlier and $8.5 billion from a year earlier, according to the latest World Bank data, despite Prime Minister Mostafa Madbouly’s December pledge that it would fall to unprecedented levels.
Analysts said higher energy-related import financing, renewed borrowing by banks and the private sector, and continued official financing inflows have helped keep the debt figure climbing.
“The one thing putting strong pressure on Egypt’s balance of payments is the rising import bill for natural gas, which hits peak consumption in the summer, with daily use reaching 7.2 billion cubic feet,” head of research at Pharos Securities Brokerage Hany Genena told Al Manassa.
Balance of payments data for fiscal year 2024/25 showed fuel imports rose to a record of about $19.5 billion, driven by liquefied natural gas imports that the state has recently relied on to avoid power outages.
World Bank data for Egypt also reflects an increase in some trade-related items. Short-term debt for “other sectors,” tied to trade, rose by about $2.5 billion between the second and third quarters of 2025, but the bank’s database does not specify which sectors drove the increase.
Amr Elalfy, head of equity strategies at Thndr Securities, said a steadier dollar has encouraged banks and the private sector to borrow again, pushing up external debt in recent months.
Elalfy pointed to positive signals in the rise of this debt. “Stability in the local currency exchange rate suggests Egypt’s near-term economic outlook is clearer,” he explained to Al Manassa.
After sharp gains against the Egyptian pound over the previous two years, the dollar exchange rate has been stable since March 2024, following the announcement of the Ras El-Hekma deal and an expanded lending agreement with the IMF, which boosted confidence in the strength of the local currency.
According to World Bank data, debt owed by banks rose by about $1.3 billion in the most recent quarter and by about $2.8 billion over the past year.
Investment expert Mohamed Abdel Hakim attributed the prime minister’s optimistic tone on debt reduction to the shift toward relying on direct investment instead of borrowing, along with setting a cap on government investment. He said these steps would ease pressures over the long term.
Speaking to Al Manassa, Abdel Hakim cited the Alam Al-Roum deal as an example of using investment as an alternative to debt. “The huge liquidity generated by this deal does not increase debt. It is used to reduce it directly by paying down short-term obligations or reducing the need for new borrowing,” he said.
In late December 2025, the government announced it had received $3.5 billion from Qatari Diar, as part of an investment deal to develop and expand a parcel of land in the Samla and Alam Al-Roum area on the North Coast.
Abdel Hakim described the Alam Al-Roum deal as a “transfer of ownership to strategic partners that injects new blood into the economy without compounding interest.”
At the same time, the government said on Thursday it would receive 3 billion euros from the European Union this year, under a macroeconomic support and budget support agreement that falls under debt.
EU support for Egypt is typically classified as concessional lending, Abdel Hakim said. “We see it as healthy debt because its repayment terms are very long, and its interest is far below market rates. It does not burden the budget as much as it provides a credit backstop that boosts international institutions’ confidence, which lowers the cost of insuring sovereign debt.”
The total EU support package for Egypt is estimated at 7.4 billion euros under the Comprehensive Strategic Partnership framework, to be disbursed through 2027. It includes 5 billion euros for budget support, 1.8 billion euros in investment guarantees for European and Egyptian companies to invest in Egypt, and the remainder, about 600 million euros, in training, technical assistance, and capacity-building support, including 200 million euros for migration.
