FinMin looking to narrow Egypt’s financing gap to EGP 720 bn next fiscal year -Kouchouk: The Finance Ministry is working to trim EGP 100 bn off Egypt’s forecasted budget deficit in FY2019-2020 to EGP 720 bn, Vice Minister of Finance Ahmed Kouchouk tells Al Shorouk. According to Kouchouk, the ministry is looking to extend the tenors of some of its debt, including zero coupon bonds. The government plans to plug the gap with bond issuances and the final USD 2 bn tranche of the IMF facility, which is expected to land in Egypt in July, in addition to eurobond and green bond issuances.

Background: Egypt has around EGP 375.5 bn in maturing debt, with total interests payments projected at EGP 569 bn next fiscal year, a senior government official had told us last month. The government estimates a 1% increase in global interest rates would raise Egypt’s borrowing costs by EGP 8-10 bn. The Finance Ministry began earlier this year implementing a comprehensive debt reduction strategy, which aims to reduce debt to 80% of GDP by 2022. The strategy is seeing the government extending the maturities of its debt and speed up inclusion of informal businesses into the formal economy.