Egypt to issue LE 153.5B in debt instruments during November

CAIRO – 30 October 2018: The Egyptian Ministry of Finance aims to issue debt instruments worth LE 153.5 billion in November 2018, compared to LE 192 billion targeted during October, recording a decline of 20 percent.

The ministry’s plan showed that it intends to issue treasury bonds of LE 5.5 billion in November. It also targets to issue treasury bills of LE 148 billion.

Lately, Egypt has launched an international promotion campaign for its global bonds in European and Asian countries such as South Korea, Italy, France, China and Japan, to expand the investor base and increase liquidity levels for Egyptian securities, contributing to reducing the high yields required on government securities, and thereby reducing the public debt burden.

Former Minister of Finance Amr el-Garhy announced in May that the ministry is working on a medium-term plan to decline the public debt from 107-108 percent in fiscal year 2016/2017 to reach 80 percent by 2020.

Garhy noted that this trim will be achieved through decreasing the budget deficit, achieving a primary surplus of 2 percent of gross domestic product (GDP) and increasing average per capita income.

Egypt to lower public debt to 80% by 2020: Finance Min.

CAIRO - 6 May 2018: The Ministry of Finance is working on a medium-term plan to decline the public debt from 107-108 percent in fiscal year 2016/2017 to reach 80 percent by 2020, Minister of Finance Amr el-Garhy said.

By the end of 2017, the total public debt recorded LE 3.4 trillion, the central bank of Egypt (CBE) revealed, stating that it represented 83.8 percent of the gross domestic product (GDP).

In 2018/2019 budget, the public debt is expected to be lowered to 91 percent of GDP.

A look at 2018/2019 budget in Parliament

CAIRO - 6 June 2018: Twenty five days before the new fiscal year starts, the Egyptian Parliament approved the 2018/2019 budget after discussing all its items. During the upcoming days, the final draft of the budget will be sent to President Abdel Fatah al-Sisi to ratify the budget in order to be taken into action.

In October, three people familiar with the matter told Bloomberg that Egypt plans to contact JPMorgan Chase & Co. for inclusion in its emerging-market bond indices to boost inflows from overseas institutional investors into its domestic debt market.

The step will lead the government to take measures to guarantee that Egypt’s debt is suitable for inclusion over the next year.

Egypt’s steps to make its debts eligible include talks with Belgium-based Euroclear to settle its domestic debt transactions. Investors currently have to go through local banks to clear transactions in treasury bills and bonds.

Egypt canceled bids for treasury bills four times this year, each worth LE 3.5 billion, amid calls to raise its interest rates.

The Central Bank of Egypt’s Monetary Policy Committee kept interest rates unchanged for the fourth time this year during September meeting, setting the overnight deposit rate and the overnight lending rate at 16.75 percent and 17.75 percent, respectively.

For the current fiscal year, the budget deficit is estimated to record LE 438.59 billion, or 8.4 percent, planned by the ministry to be financed through treasury bills and bonds and through international and Arab loans.

Egypt seeks to be listed on JP Morgan's emerging bond index

CAIRO - 1 October 2018: Egypt plans to contact JPMorgan Chase & Co. for inclusion in its emerging-market bond indices to boost inflows from overseas institutional investors into its domestic debt market, three people familiar with the matter told Bloomberg.