CBE issues LE 3B in T-bonds Monday

CAIRO – 13 August 2018: The Central Bank of Egypt (CBE), on behalf of the Ministry of Finance, issued LE 3 billion ($167.68 million) in treasury bonds Monday.

The T-bonds were offered in two installments, with the first valued at LE 1.25 billion with a 10-year term and the second worth LE 1.75 billion with a five-year term.

For the current fiscal year, the budget deficit is estimated to record LE 438.59 billion, or 8.4 percent, planned by the ministry to be financed through treasury bills and bonds and through international and Arab loans.

Egypt targets an average of interest rate on the government debt instrument to reach 14.7 percent in the current budget, compared to an expected average of 18.5 percent in 2017/2018 budget.

Foreign investors’ investments in the Egyptian government debt instruments recorded $23.1 billion by the end of March 2018, up from about $20 billion in December.

Egypt needs to fund 2018/2019 budget by LE 714.64 billion; LE 511.21 billion will be provided from domestic debt instrument and the rest will come from foreign financing through the issuance of bonds and the IMF loan.

In November 2016, the Executive Board of the IMF approved a $12 billion loan as a financial assistance for Egypt to support the Egyptian economic reform program.

Upon the board's approval in November, Egypt floated its currency, losing around 50 percent of its value as part of the economic reform program which imposed taxes, including the value-added tax (VAT), and cut energy subsidies, all with the aim of trimming the budget deficit.