Egypt to sell foreign currency bonds worth about $5bn

Egypt plans to sell foreign currency bonds worth about $5 billion, Finance Minister Mohamed Maait revealed.

“We are going to sell bonds in the coming months in the market. It could be $5 billion plus or minus,” the Minister stated. This proposed bond sale comes barely five months after the country’s two tranche international bonds sale valued at €2 billion ($2.3 billion) and has an eight-year maturity period and 12 years and yield of 4.75 and 5.624 percent respectively.

In February, the country raised $4 billion from international debt markets to finance budget deficit and bolster foreign reserves after which it began the bond offering. The bonds were issued at three maturities, with a five-year tranche and a 10-year tranche raising $1.25 billion each.

An additional 30-year tranche raised at $1.5 billion. The yields on the bonds were 5.6 percent, 6.6 percent and 7.9 percent respectively. Since 2016, Egypt’s foreign-currency reserves have witnessed a tremendous increase and has risen to $42.5 billion as at February 2018 thanks to international bonds.

Egypt’s gross domestic product grew by 5.3 percent in the 2017/2018 fiscal year that ended in June 2018, the highest rate in 10 years. In the fiscal year ending June 2019, Egypt targets a deficit of 8.4 percent. Its economy has also shown signs of recovery despite ongoing reforms which are considered tough.