We’re inching closer to our second-ever sovereign sukuk issuance: The Finance Ministry is aiming to complete an issuance of sukuk before the end of FY 2024-2025, a government source told EnterpriseAM. This was confirmed by another government source, who told us that the government is currently waiting on the most opportune time to complete the issuance, and said that this could happen as early as this month.

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REFRESHER- Finance Minister Ahmed Kouchouk said last month that Egypt is planning on issuing USD 2 bn in sukuk in 2025 through multiple offerings, with the government already having appointed banks for the issuance. The banks involved in the issuance are the same ones that managed our maiden sukuk issuance in February 2023 — HSBC and Citibank, along with Dubai Islamic Bank, First Abu Dhabi Bank, and Abu Dhabi Islamic Bank — a senior government source told EnterprimeAM at the time.

ICYMI- Egypt last tapped the global debt market back in January, with a USD 2 bn eurobond issuance.

The details: The issuance — which would mark Egypt’s second ever sovereign sukuk issuance — will finance a portion of the current fiscal year’s funding needs, both sources told EnterpriseAM. The government has also already held promotional meetings with investors who would be interested in new sukuk issuances, the sources said.

Egypt’s financing needs are on the rise: The Madbouly government’s financing gap for the FY 2025-26 fiscal year is estimated to come in at EGP 3.6 tn, up 25% y-o-y. Meanwhile, the budget deficit to GDP is expected to decrease from the 7.6% estimated for this fiscal year to 7.3% of GDP in FY 2025-26, before falling further to 5.5% of GDP in FY 2026-2027.

There could be even more in the pipeline: A government source told EnterpriseAM back in February that the government plans to issue between USD 1-1.5 bn worth of green bonds or eurobonds and its first social bonds in 4Q 2025.

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