The new central clearing and depository company that will handle all the clearing and registry of government debt issuances earned Prime Minister Moustafa Madbouly’s final sign-off, according to an official decision published in the Official Gazette on Thursday. Cabinet had approved the establishment of the new central clearing and depository company last year. The company will have initial capital of EGP 100 mn, 60% of which will be put up by the Central Bank of Egypt, with the Finance Ministry and Misr for Central Clearing, Depository and Registry (MCDR) each contributing 20%.

The establishment of a central securities depository is one of the conditions to clearing local debt issuances with Belgium-based clearing house Euroclear under the terms of a 2019 agreement, Finance Minister Mohamed Maait had said earlier this month. This would give foreign investors — who can currently only access the market through a few local banks — better access to Egyptian debt.

How does it differ from MCDR? The new company would fulfill the roles previously shared by Misr for Central Clearing and Depository and the CBE, head of the Finance Ministry’s Debt Management Unit Mohamed Hegazy told Enterprise yesterday. Earlier plans to establish the clearing mechanism in early 2020 were slowed by covid-19. The ministry now expects to reach that milestone sometime between September and November 2021, Maait said earlier this month.