Emerging markets are looking for a fairer financing environment that stimulates investment and economic growth, Egypt’s finance minister said, calling for unified international efforts to build a financial architecture that is more supportive of developing economies.

Speaking at the Paris Forum, Finance Minister Ahmed Kouchouk stated that expanding innovative financing mechanisms, such as debt-for-investment swaps, debt exchanges, and other modern financial tools, helps create additional fiscal space. This newly created fiscal room will be explicitly directed towards increasing expenditure on human development and social protection programmes for citizens.

Kouchouk added that the private sector is responding positively to Egypt’s economic reforms and policies, having increased its investments by 73% last year and continuing to grow strongly this year. The government remains committed to directing any exceptional revenues immediately towards reducing the overall debt volume and improving government debt metrics, he added.

Egypt is working on an integrated and balanced strategy to improve all budget debt indicators and reduce financial risks, the minister explained. He emphasised that stimulating economic activity while maintaining fiscal discipline ensures a sustainable debt reduction path for future generations.

The minister noted that the country’s budget debt has fallen 13% over the past two years, contrasting Egypt’s debt trajectory with a 6% increase in budget debt across emerging markets during the same period. He added that the external debt of Egypt’s budget agencies decreased by approximately $4bn over the past two years, and by a further $1.5bn in the current year.

Egypt plans to reduce the debt-to-GDP ratio of its budget agencies to 78% by June 2027 and to 70% in the medium term, Kouchouk concluded.