A prospectus for Egypt’s new $12bn bonds law has stated that the country will seek to release its first round of sovereign Islamic bonds at the beginning of 2014, in an attempt to reduce the pressure currently being placed on the country’s public finances.
The prospectus further tasked HSBC Holdings and QNB Global with the rights to organise and administer the programme.
President Mohamed Morsi previously signed off on a law granting Egypt the right to sell Islamic bonds, in order to better help address the country’s budget deficit and increase the government’s foreign currency reserves which fell by over $20bn after the outbreak of the 25 January Revolution.
The prospectus states that the country will seek to release its first round of Islamic bonds in the beginning of 2014, as part of an attempt to secure diversified sources of funding to help address the country’s budget crisis.
Traditional bonds may also be released before this period if the circumstances of the market allow for such.
Egypt is currently in the process of negotiating with the International Monetary Fund (IMF) regarding the country’s pending $4.8bn loan, which is conditional upon the government enacting a series of reforms to curb Egypt’s growing budget deficit.
The prospectus further stated that the government sought to continue working with the IMF in order to achieve these goals, without providing much detail as to what measures were being taken.
The prospectus further stated that Egypt’s current levels of foreign debt had totalled $33.7bn by the end of December, compared to $35bn by the end of 2011.
Translated from AlBorsa Newspaper