Back to the complete issue
Monday, 1 October 2018

Egypt angling for inclusion in JP Morgan emerging markets bond index?

Egypt angling for inclusion in JPM EM bond index? Egypt reportedly wants to be included in JP Morgan’s emerging markets government bonds index, three sources familiar with the matter tell Bloomberg. In preparation for its pitch, the government is taking steps to make Egypt’s debt eligible for including, including starting talks with Belgium’s Euroclear to facilitate the settlement of domestic debt for overseas investors. According to the sources, “ensuring cross-border domestic debt purchases could be cleared efficiently would also help facilitate Egypt’s inclusion in the index.” The government hopes that inclusion in the index would “encourage passive inflows and help ease the debt servicing burden” as demand for EGP-denominated dropped in the midst of the emerging markets sell-off, which has pushed up yields.

GCC countries are looking to do the same: “Saudi Arabia and four other Gulf countries will become eligible for inclusion in JPMorgan’s emerging-market bonds indexes from the end of January, potentially attracting billions of dollars in passive inflows,” Bloomberg writes.

FinMin carries through with treasury auction despite higher yields: The quest for inclusion on JPM’s EM bond index comes as an auction yesterday saw yields on 91-day treasury bills rise to 19.711% from 19.62%, while yields at the nine-month auction rose to 19.938% from 19.84% previously, according to CBE data. The auction saw the sale of EGP 10.6 bn worth of 91-day bills and EGP 10.37 bn worth of nine-month bills. The sale came after Finance Minister Mohamed Maait said last week that his ministry would call off sales of longer-term domestic bonds as long as yields remained high. The ministry had called off its fourth bond auction in as many weeks just a few days prior.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt; Hassan Allam Properties (tax ID:  553-096-567), one of Egypt’s most prominent and leading builders; and Saleh, Barsoum & Abdel Aziz (tax ID: 220-002-827), the leading audit, tax and accounting firm in Egypt.