A proposal to sell the Suez Canal, in north-eastern Egypt, has sparked widespread concern among Egyptians, who are already deeply suspicious of the government’s accelerated sale of state assets, vital infrastructure and strategic ports to Gulf allies.

The idea was put forward days ago by Hassan Heikal, an adviser to the Egyptian Prime Minister, as part of what has been described in the media as the “grand swap”, involving the exchange of state assets and the transfer of debt between state institutions.

Under the proposal, domestic debt would effectively be wiped out by transferring part of the state’s assets – such as its stakes in public companies or the Suez Canal – to the Central Bank of Egypt, provided that the bank receives assets equivalent to the value of the debt.

President Abdel Fattah El-Sisi’s regime is currently weighed down by domestic debt of 11.057 trillion Egyptian pounds (approximately $219 billion) as of the end of June 2025, and external debt of around $164.8 billion at the end of the first quarter of 2026, according to official data.

President Abdel Fattah El-Sisi’s regime is currently weighed down by domestic debt of 11.057 trillion Egyptian pounds (approximately $219 billion) as of the end of June 2025, and external debt of around $164.8 billion at the end of the first quarter of 2026, according to official data.

Debt is consuming more than half of Egypt’s treasury revenues, while annual debt-servicing costs reached around 5.2 trillion pounds in the latest budget, including 2.8 trillion pounds in principal repayments and 2.4 trillion pounds in interest payments.

Egypt is due to pay off $62.8 billion in external loans over the 12 months from April 2026 to March 2027, including $7 billion in interest and $55.8 billion in loan principal, according to World Bank data.

Amid the deterioration of Egypt’s finances since the military coup of 3 July 2013, the government has accelerated the sale of state assets. The process has involved major companies operating in vital and sensitive sectors, including oil, electricity, energy, transport, telecommunications, tourism, banking and finance. It has also extended to the sale of strategic plots of land on the Mediterranean coast, most notably the Ras El-Hekma deal with the UAE, Alam Al-Roum with Qatar, and Ras Gamila on the Red Sea, which may be sold to Saudi Arabia.

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Growing public concern over the proposal to sell the Suez Canal is fuelled by four main factors. The first is a statement by the Egyptian Cabinet, which........

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