Ahmad 
Recent data from the Central Bank of Egypt showed that the private sector’s share of total banking sector loans declined to 46.2% in March 2024, compared to 51.9% at the end of 2023.
This decline is considered the first of its kind since March 2019, when the private sector’s share was 36% at the time.
According to banking sources, the decline is partly due to the large increase in interest rates announced by the Central Bank, which reached 6% in March. This increase raised borrowing costs, which prompted some companies to postpone expansion plans and reduce the amount of borrowing.
Private sector loans reached their highest levels in 2002, reaching 63% of total credit, but since the beginning of 2021, private credit has begun to gradually decline.
Experts expected this decline to continue until the central bank begins lowering interest rates, which may happen in the first quarter of next year.
Given the current economic conditions, the International Monetary Fund indicates that the Egyptian economy may achieve growth of 4.4% in 2025.
The effects of rising interest rates vary between companies, as large companies can bear the high burdens better than medium and small companies.
Accordingly, experts expect a recovery in private sector loans by the middle of next year, with an emphasis on the importance of the partnership between the state and the private sector
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