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The Finance Ministry has more than doubled its program for international debt issuances in the draft budget for the next fiscal year, coming in at a total of EGP 400 bn (USD 8 bn), up from EGP 150 bn (USD 3 bn) in the current fiscal year, according to official figures seen by EnterpriseAM. A government source confirmed to EnterpriseAM earlier this week that the draft budget priced the USD at EGP 50.
But "Egypt does not necessarily have to complete all of these debt issuances, as it will largely depend on global market conditions," a government source told EnterpriseAM. Instead, what this target does is provide a clear program with a diverse set of issuances that will attract more segments and put “the country on the global issuance map." Egypt’s return to international debt markets will also be helped by a decline in global interest rates, the source added.
The gov't expects to issue nearly half of the program's total: The Finance Ministry aims to issue nearly USD 4 bn in debt during the next fiscal year under the international debt issuance program, a government source told us. It also aims to lower the external debt held by public sector entities included in the budget by USD 1-2 bn in the 2025-2026 fiscal year.
With local issuances also in the mix, the total figure penciled in for next fiscal year comes to EGP 3.6 tn — a significant jump from the EGP 2.8 tn of debt issuances planned for the current fiscal year. Local borrowing will comprise EGP 2.2 tn in treasury bills and some EGP 928.9 bn in treasury bonds.
The ministry is also working to further extend the maturity of the government’s debts to after it recorded 1.8 years in December, up from 1.2 years in June 2024.
We could also be in line for some big debt issuances before the current fiscal year comes to a close, after the Finance Ministry secured the cabinet’s approval to issue between USD 3-4 bn worth of international bonds in the second half of FY 2024-25. Proceeds from the offering — which may include sukuk and long-term sustainability bonds — will go toward covering USD 3 bn in maturing external debt due during the same period.
ICYMI- Finance Minister Ahmed Kouchouk delivered his budget statement to the House on Tuesday, giving us the first proper look at the draft state and public government budgets for the next fiscal year. You can read our rundown of the budget here.
