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Egypt repays $24bn to cover foreign debt, departing investors

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Egypt's capital Cairo: higher interest rates, a weak currency and investor wariness have been pushing up the government's cost of borrowing

Egypt paid $24 billion in the first five months of 2022 to service foreign debts and to cover foreign investors withdrawing funds from the country, Egypt’s state news agency MENA reported on Wednesday.

Of the amount, $10 billion went to service foreign debt and another $14 billion to foreign investment funds, it quoted an unnamed central bank official as saying.

Higher interest rates, a weak currency and broader investor wariness of emerging markets have been pushing up the government’s cost of borrowing. Egypt has projected a $30 billion budget deficit for the financial year that will start in July.

Foreigners investing in Egyptian treasuries denominated in the local currency had been leaving Egypt even before US Federal Reserve rate hikes that started in March and Russia’s invasion of Ukraine.