The Ismail cabinet signed off on a planned USD 7 bn eurobond program for FY2017-18, Prime Minister Sherif Ismail told the state-owned MENA news service yesterday, Reuters reports. The size and currency of the issuance, which will be used to plug the budget deficit, will be determined in the coming few weeks, he added. Finance Minister Amr El Garhy tells Al Borsa that he expects the government to issue USD 7-8 bn in eurobonds in 2H2017-18. EUR 1-2 bn in eurobonds are expected to be up for sale by the end of 2017, according to previous statements by El Garhy. As with past eurobond issuances, these will also take place on the Luxembourg and London stock exchanges, he added. With this issuance, the Finance Ministry is hoping to ride a tidal wave of interest in emerging markets debt seen this year. Just ask Saudi Arabia, which raised USD 12.5 bn in its second bond offering this year, according to Bloomberg.

This comes as Egypt’s borrowing costs are going down significantly. For the first time in more than a year, EGP-denominated Egyptian bonds are not the highest yielding among the major emerging markets tracked by Bloomberg. “The average rate on the nation’s debt plummeted about 400 basis points since July, dragging the yield below that of Nigeria, whose multiple exchange rates have perturbed investors.” We noted earlier this week that yields on Egypt’s five- and 10-year government bonds have shed 115 bps in their last auction.