Egypt Approaches Banks on 2021 Eurobond Sale of Up to $7 Billion

CAIRO (Capital Markets in Africa) — Egypt has approached investment banks to advise on a plan to raise as much as $7 billion from international debt markets in the first half of next year, according to people familiar with the matter.

The so-called request for proposal is being sent to banks, said the people, who asked not to be identified because the matter is confidential. The offering could include the dollar and euro-denominated bonds. Officials in the ministry couldn’t be reached for comment.

Egypt, one of the Middle East’s most indebted countries, tapped international markets for a record issuance this year and sold the region’s first sovereign green bonds. Finance Minister Mohamed Maait has said the country could borrow abroad in the first half of 2021 if needed.

BNP Paribas SA, Citigroup Inc., JPMorgan Chase & Co., HSBC Holdings Plc and Standard Chartered Plc arranged Egypt’s most recent Eurobond sale in May.

The North African nation is also planning the country’s debut sovereign Islamic bonds, or Sukuk, in 2021, Maait said in an interview this month. If the ministry wins parliament’s backing for a draft Sukuk law before February, it could proceed with the sale before June, he said.

Egypt’s external funding gap in the current fiscal year ending in June is estimated at $12.2 billion by the International Monetary Fund, compared with $9.2 billion in the prior period. The Washington-based lender anticipates Egypt will cover its needs through several sources including the IMF and other international financial institutions, in addition to Eurobond sales.

Source: Bloomberg Business News