Egypt to issue Eurobonds worth $3-4B in 2018/19

CAIRO – 18 February 2018: Deputy Finance Minister Ahmed Kojak told Al-Arabiya television network on Sunday that Egypt aims to sell Eurobonds worth $3-4 billion in the fiscal year 2018/2019.

Last week, Ministry of Finance announced that Egypt succeeded in issuing Eurobonds worth $4 billion on three tranches; three, five and 30 years.

The purchase requests exceeded $12 billion in the first few hours after the issuance despite the volatility of the international stock markets, the statement said.

Kojak confirmed that Egypt's return to the international bond market is the first since May 2017, adding that the Egyptian government has issued Eurobonds worth $4 billion on three different maturities, a five-year term of $1.25 billion, with an annual return of 5.58 percent; a 10-year term of $1.25 billion, with an annual yield of 6.59 percent and a 30-year maturity of $1.5 billion and an annual return of 7.9 percent.

Meanwhile, Finance Minister Amr el-Garhy said that Egypt will start talks this month with European banks to issue euro denominated Eurobonds.

The value of the issue is expected to be €1-1.5 billion and will be sold next April, he added.

Egypt issued $7 billion in Eurobond sales in January and May 2017 on the global bond market, both of which were oversubscribed, according to the Ministry of Finance.

Egypt has embarked on a bold economic reform program that included the introduction of taxes, such as the value added tax (VAT), and cutting energy subsidies, with the aim of trimming the budget deficit.

The country has floated its currency in November 2016 before it clinched a $12 billion loan from the International Monetary Fund (IMF).

Egypt is to receive a fourth disbursal of that loan, worth $2 billion, in June or July of 2018, the Finance Ministry said in previous statements, bringing the total it has received to $8 billion. The IMF agreed in December 2017 to the third disbursal, also worth $2 billion.