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Wednesday, 4 October 2017

USD bonds to be issued in Jan-Feb, EUR bonds later -El Garhy

Here’s the plan on the next eurobond issuance: The government is planning to issue USD-denominated eurobonds between January and February 2018, followed by a EUR-denominated issue later, Finance Minister Amr El Garhy said, according to Reuters. El Garhy says the USD-denominated issue will be worth EUR 3-4 bn and the EUR-denominated bond around EUR 1-1.5 bn. “We’re studying whether there could be a chance for something in November, but I think it would be between January and February. We may begin with the USD-denominated eurobond followed by the EUR one,” El Garhy says. Bloomberg’s Ahmed Feteha and Mirette Magdy confirmed that El Garhy’s plan for the issuances was leaning away from the holiday season in December.

The timing for EM bond issuances remains optimal as Abu Dhabi raised USD 10 bn in bonds on Tuesday, pushing MENA bond sales this year to a record USD 89 bn, according to Bloomberg. The emirate sold USD 3 bn of five-year notes, USD 4 bn of the 10-year tranche and USD 3 bn of the 30-year offering, people familiar with the matter said. The transaction raised total demand from investors of around USD 30 bn, they said.

Separately, El Garhy also announced yesterday that tax revenues increased 31.8% y-o-y to record EGP 464.4 bn in the fiscal year that ended in Egypt, up from EGP 352.3 bn in FY 2015-16. Total government revenues also increased by 34% y-o-y to record EGP 659.2 bn FY 2016-17, up from EGP 491.5 bn a year earlier. Interest rate hikes will dive the government’s borrowing costs up to EGP 410 bn in FY 2017-18 from the targeted EGP 380 bn, he added.

Meanwhile, the government is targeting export revenues of USD 23 bn by the end of the year, said Shereen El Shorbagy, head of the Trade and Industry Ministry’s Export Development Authority. Exports from 9M2017 had already reached USD 14 bn, or 60% of the target, she tells Al Borsa. The ministry hopes to raise the annual export target by 10% in 2018 to USD 25.3 bn.

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