Days after the controversial statements of Egyptian President Abdel Fattah El-Sisi regarding the "blessing" of borrowing and its preference over the country's prosperity and development, and that the debts, unprecedented in Egypt's history, are at a safe level, the Central Bank and the Minister of Finance rushed to bless these statements and confirm their validity.

This raised questions about the involvement of the Central Bank and the Minister of Finance in courtesy of Sisi after talking about debt and borrowing comfortably and reassuringly, and attributing credit to the debt for making a qualitative leap in the development of the economy, without which "the state would retreat and the citizens would suffer."

The Central Bank did not wait long, as it initiated a statement announcing the decline in debt on a quarterly basis, by a slight rate, for the first time in 4 years, and amounted to 111.3 billion dollars last March instead of 112.7 billion in December 2019.

The statement added that the total debt and interest interest paid by Egypt during the six months, from October 2019 to the end of March 2020, amounted to about $ 10.8 billion, but the external debt jumped by 4.78% on an annual basis during the third quarter of Last fiscal year 2019/2020, which ended last March, to 111.3 billion.

But it did not include more than 20 billion borrowed by the Sisi government since last April until today, the same month that witnessed a decline in cash reserves, worth 8.5 billion dollars, to 37.03 billion dollars at the end of April, compared to 45.5 billion at the end of February.

The blessing of borrowing

During the opening of a number of projects in Alexandria at the end of last month, Sisi reduced the size of the debt, and even went further, praising the borrowing policy pursued by his government and its role in pulling the country out of recession and collapse.

He said in an intervention, "We have a choice of two to do or not work, if we do not like that (borrowing), meaning the state will retreat and its people sell me, and the required number will remain much larger than what we are doing, and the alternatives are that we borrow with easy numbers."

He added, "There is a lot of talk about public and external debt, and therefore we need to make it clear to people that we cannot stop this, bearing in mind an important point, which is that the measurements of debt, even if they are high, but our effort as a state in controlling this debt and increasing the size of the national product will make it within the borders." Safe. "

Al-Sisi continued, directing his speech to Minister of Finance Mohamed Maait, "I am talking about this point of Taa Al-Din, because there are words in it that you do not want to associate with people in Egypt that negatively affect their understanding ... We are building a country, oh we stop."

On the same day, the Minister of Finance rushed to communicate with the media and dwelled on various satellite channels about Sisi's new economic theory in dealing with economic problems and the extent of its effectiveness, and its role in changing the economic compass and establishing giant national projects.

He stressed that the debts are within safe and under control borders, and do not pose any risks to Egypt's ability to repay, and that the borrowing is for the establishment of mega projects, according to the minister's statement.

Economists refuted these allegations and confirmed, in statements to Al-Jazeera Net, that the claim that debt is safe, in relation to the gross national product, is inaccurate, because the gross national product is not real on the one hand, and it does not take into account the inflation factor that raises the gross national product.

Figures falsified

According to the professor of finance and economics, Ashraf Dawaba, there is no country in the world that builds its development on external and internal borrowing because ultimately, debt service will deplete any development plan before it even begins the development process, indicating that “loans can be used as an aid in this regard, With my reservations on borrowing in general. "

And he denounced - in a statement to Al-Jazeera Net - the new central bank data with old content, saying, "The central bank's data does not respect the standards of transparency, disclosure and integrity, and if its data are correct, why did not disclose the size of the debt since last April, which exceeded $ 20 billion according to some estimates. The last of which is borrowing two billion dollars through conventional Islamic financing, so how can the debts decrease? "

Dawaba emphasized that Egypt suffers from the presence of other institutions such as the Central Agency for Public Mobilization and Statistics, and other oversight agencies, in addition to the Central Agency, as it is not committed to transparency in its indicators and figures that do not reflect reality, and therefore any talk about the decline of debt or its presence in the safe zone is not Accurate and unreliable.

For his part, Mahmoud Wahba, an Egyptian-American businessman and economic expert, refuted the allegations of Sisi, his government, officials and reports of some financial institutions, stressing that "debts are insecure, even according to lenders such as the International Monetary Fund."

He wrote in a post on the social networking site Facebook, "Hey Sisi, debt is insecure according to a report issued by the International Monetary Fund. Sisi claimed that debt is safe, but he knows that the opposite is true, and if he does not know, he can read the attached report that was issued by the IMF." .

Loan rotation

Dr. Hossam El-Shazly, a visiting professor of change management and strategic planning at the University of Cambridge, commented, "Al-Sisi did not lie when he said that debt is the key to the Egyptian economy, as the Egyptian economic system was established during his reign on the concept of loan rotation, postponement of entitlements, and full compliance with the conditions of international lending institutions."

He added to Al-Jazeera Net: It is no wonder that the Central Bank is trying to support these glamorous statements by manipulating debt reports and their size. In Sisi's dictatorial system, all institutions, especially financial ones, play the tune of corruption and lack of transparency in order for Sisi to applaud even in light of the spread of poverty, the exit of companies and the flight of investors, And the failure of the alleged reform programs one after the other.

The economist described Sisi's virtual system as a thieves' economic model, as successive loan funds allow certain sectors to dominate the Egyptian economy, especially the military, and root for the spread of institutional corruption with the absence of any real oversight role for parliament or regulatory institutions, which is a disastrous structure that opens many doors for control. Foreign capital depends on the country's capabilities.