Cairo– It seems that the Egyptian moves towards reducing dependence on the US dollar and alleviating pressure on the local currency, in the context of attempts to contain the debt crisis, began to bear fruit in terms of external financial transactions.
According to a recently approved agreement between Cairo and Moscow, it will start Egypt Loan Dabaa nuclear project – The value of $ 25 billion- for Russian companies in the ruble, after the Egyptian side was unable to pay the US dollar.
The Russian Deputy Minister of Finance, Vladimir Colette, stated that the difficulty of paying loans in “unsuccessful” currencies prompted the two parties to shift towards the settlement of debts in the ruble.
In the same context, Cairo and Moscow signed, last May, an agreement on the establishment of a Russian industrial zone within the economic zone ofSuez CanalWith an investment value of up to $ 4.6 billion.
After the signing of the agreement, Russian Minister of Industry and Trade Anton Alejhanov stated that 40% of the joint commercial transactions between the two sides are settled in other currencies other than the euro and the dollar, adding that local currencies have become one of the means of settlement, while emphasizing that there is more work required in this regard.
The exchange rate of the US dollar is about 50 Egyptian pounds, while the ruble equals about 0.63 pounds.
Religion is a black cloud
Earlier, the Egyptian Finance Minister Ahmed Kojak external described And inflation They represent a “black cloud” that blocks the country’s unprecedented development achievements.
The volume of external debt for Egypt is about 155.1 billion dollars, equivalent to 82.9% of gross domestic product.
According to data Central Bank Al -Masry, the average per capita external debt reached about $ 1293 by the end of 2024, while the internal debt exceeds 13.3 trillion pounds (about 263 billion dollars).
Out World BankThe Egyptian government must pay about $ 43.2 billion of foreign obligations during the first 9 months of this year, and about $ 118 billion must be paid during the next five years starting in 2024.
During the past year, Egypt paid about 38 billion dollars as foreign loans, according to official officials, which means that the country is required to pay an additional 80 billion dollars before the end of 2029.
What about the nuclear reactor loan?
In December 2017, Egypt and Russia signed an agreement to construct the Al -Daba’a Energy Station, the first station of its kind in the country.
The project is funded by a Russian government loan worth $ 25 billion, which extends for 22 years, at a interest of 3% annually.
According to Russian officials, Egypt has paid all the debts owed to it until the beginning of 2024.
The project aims to build 4 reactors of the “3+” generation operating with compressed water, with a total capacity of 4,800 megawatts, at 1200 megawatts per reactor.
The completion rate in the project has reached 30.1%, and it is expected to rise to 50% during the next year, with the first reactor be launched in 2028, according to the announced table.
Rouble in a crisis
For his part, economist Abdel Nabi Abdel -Muttalib reduced the importance of the effect of using the ruble in paying loans to alleviate the debt crisis, explaining that Cairo is facing the difficulty of payment regardless of the currency used, whether it is the ruble or the dollar.
In his speech to Al -Jazeera Net – Abdel -Muttalib stressed the need for the government to work to increase its revenues from the ruble so that it can fulfill its obligations towards Moscow, adding, “In all cases, Egypt must have a surplus that it can use in payment operations, which requires increasing revenues from all difficult currencies.”
Despite the reservation, the economic expert sees some positive aspects in the recent Egyptian -Russian agreement, as it is expected to contribute to strengthening commercial transactions between Cairo Woew.
In his optimism about the repercussions of the trend towards the use of local currencies, Abdel -Muttalib added that this approach can contribute to increasing Egyptian exports to Russia, and to achieve better conditions for obtaining Egyptian imports from Moscow, including arms and wheat deals, and may even extend to include cooperation in the gas field, so that they become Cairo gate Russian gas to Africa.
The expert also did not rule out that Egypt would turn to contract similar agreements with other countries to settle commercial payments in local currencies, pointing to the existence of similar agreements with China.
Recently, the Egyptian Minister of Investment announced that his country started allowing Chinese companies to use the Chinese yuan in its financial dealings, with the support of the Central Bank of Egypt.
The volume of trade exchange between Egypt and China reached about 17 billion dollars during the year 2024, compared to 16 billion in 2023, an increase of 6%, while trade between Egypt and Russia did not exceed $ 9 billion.
Value and recommendation
In the same context, the Executive Director of the International Center for Development Studies, Mustafa Youssef, appreciated the move that the two countries took towards liberation from the dollar, hoping that other countries will follow their example to limit what he described as “international slavery” of the American currency.
On the ability of the ruble to alleviate the burden of the Egyptian religion, the economic researcher – in his talk to Al -Jazeera Net – indicated that Egypt will face a challenge in providing the ruble, given that its exports to Russia are limited.
According to official statistics, Egyptian exports to Russia recorded about 607 million dollars during the year 2024, while imports from Russia amounted to about 6 billion dollars during the same period.
Away from the trade exchange, Youssef pointed out that the Russian tourist – who prefers Egypt as a tourist destination – may be an additional source to provide the ruble, noting that the number of Russian tourists reached about 1.6 million people during the year 2024, the majority of whom prefer beach cities such as Sharm El Sheikh and Hurghada.
The economist believes that the radical solutions to the Egyptian debt crisis are not related to the type of currency used to pay, but rather lies in:
- Stop spending on economically useless projects.
- Rationalization of government spending.
- Increase exports and reduce imports.
- Investing in human capital as the main engine of production and export.
Russia is benefiting
As for the extent to which Moscow benefits from collecting the value of the loans, its local currency, the economist Abdel Nabi Abdel -Bari sees that Russia Through this step, she seeks to break the Western sanctions episode imposed on it since its war began with Ukraine.
He explained that Moscow is looking to strengthen its relations with Cairo as a major gate towards Africa, and this trend was reflected in the agreement of the two parties to establish a Russian industrial zone in Egypt, which is expected to undertake production and distribution tasks for the rest of the African countries.
In the same context, the economist Youssef, Youssef, saw that Russia, as one of the largest countries exporting raw materials, will benefit in the medium and long term from reducing its dependence on the dollar in its international trade, whether in terms of political or economic.