Egypt selects projects to receive green bond funding
Five environmentally-friendly projects have been earmarked to receive USD 500 mn of the proceeds from last month’s USD 750 mn sovereign green bond issuance, Environment Minister Yasmine Fouad said in a statement. The minister didn’t disclose the specific projects but said they are situated in the transport, water and waste-management sectors, and were chosen from a longlist of 41. The remaining USD 250 mn of the issuance will go towards other projects from the longlist, the statement said without disclosing how many projects would receive funding. The projects were chosen based on their environmental impact indicators, as well as the size of their budgets. The World Bank is consulting the government on the allocation of funds from the sale.
Background: Egypt’s first green bond issuance was 5x oversubscribed, receiving USD 3.7 bn in offers and netting USD 750 mn in sales. The five-year notes carry a 5.2% yield and were listed on the London Stock Exchange last week, where they will be traded on the Sustainable Bonds Market along with 240 others from more than 60 countries. The offering is part of Egypt’s debt diversification strategy, which sees the government focusing on offering longer-term debt, which it hopes will constitute 52% of the nation’s borrowing by 2022.