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CAIRO: Egypt’s foreign debt has climbed more than 10 per cent in less than a year, reaching $88.2 billion in March, the central bank said Monday, despite a raft of painful austerity measures aimed at cutting government spending.

Foreign debt is 11.6pc higher than in June of last year, but the central bank said the debt to GPD ratio is still within “safe limits according to international standards,” at 36.8pc.

Egypt has been struggling to revive its economy after the years of unrest that followed the 2011 Arab Spring uprising.

The government secured a $12bn loan from the International Monetary Fund in 2016 for an economic reform program that included slashing fuel and electricity subsidies, imposing a value-added tax and floating the currency. Foreign debt stood at $67.3bn in December 2016.

Egypt recently introduced a new wave of price hikes for fuel, drinking water and electricity, as well as for new cellular phone lines and cellphone bills. Prices for issuing passports and car licenses also went up steeply.

The austerity measures have taken a heavy toll on poor and middle-class Egyptians.

President Abdel-Fattah el-Sissi, who was re-elected earlier this year in a vote in which all potentially serious rivals were arrested or withdrew under pressure, has repeatedly called on Egyptians to be patient, saying the long-overdue reforms will pay off with time. Last month, Prime Minister Mustafa Madbouly said Egyptians should start benefiting from the reform program within two years.

The IMF praised the reforms in May, pointing to the country’s 5.2pc growth rate, a percentage point higher than the previous year.

Egypt says its foreign reserves have increased to $44bn as of May, the highest level since before the 2011 uprising.

Published in Dawn, August 7th, 2018