Eurobond sale, other loans to fill $11B fiscal gap: Minister

CAIRO - 29 May 2017: The proceeds of $3 billion Eurobond sale issued by the Egyptian government last week along with yields of treasury bonds and expected loans would help cover the $11billion financial gap in the fiscal year (FY) 2017/18, Minister of Finance Amr el-Garhy said Sunday.

Speaking to Extra News, Garhy explained that the international bonds issued in January, which generated $4 billion, and in May showed a demand of $24.5 billion, adding that the oversubscription of the international bonds is a sign of “confidence in the Egyptian market.”

The minister highlighted that 46 percent of the subscriptions were in 30-year bonds, 34 percent were for 10-year bonds and 20 percent were for 5-year bonds.

“The subscription level is higher than our credit rating, which is currently B-, while the coverage is of bonds that hold a ‘B+’ rating,” Garhy said.

Responding to a question on whether these bonds will impose pressures on the external debt, Garhy said that these yields will contribute in boosting foreign reserves and will also be used in repaying other debts due to be paid over the near future.

Last week, the minister of Finance announced that 80 percent of the money raised from the Eurobond sale came from North America and Europe, signalling foreign investment appetite, and that the proceeds would reach the Central Bank by May 31.