Egypt absorbs energy cost increases to ease consumer burden, targets $2 billion annual debt reduction

This decision aims to mitigate the immediate impact on citizens, despite increasing state costs due to regional conflicts and global risks that have doubled imported fuel prices. Egypt is expanding renewable energy to nearly 50% of total electricity generation to reduce reliance on imported energy and exposure to price fluctuations. The government has managed increased electricity demand without shortages over the past four months.

While this strategy leads to higher deficits and debt, the government is simultaneously working to reduce external debt held by budgetary authorities, having already cut it by $6.5 billion over three years. They aim for an additional annual reduction of $1.5 billion to $2 billion through increasing foreign currency resources, reducing leakages, boosting local manufacturing, and ensuring timely debt repayment. Madbouly is scheduled to meet with the Minister of Electricity to discuss electricity charges following presidential directives.