CAIRO: The Central Bank of Egypt has issued treasury bonds worth EGP 16.5 billion ($1.05 billion), as part of efforts to help the Ministry of Finance clear the government budget deficit.
In a statement, the bank said the value of the first offering amounted to EGP 5 billion for a period of three years, the second offering amounted to EGP 6 billion for a period of five years, and the third 10-year term offering was valued at EGP 5.5 billion.
The government resorted to financing the budget deficit by offering bonds and treasury bills as debt instruments, and government banks are their largest buyers.
Last Saturday, Minister of Finance Mohammed Maait announced that JP Morgan decided to include Egypt in its watchlist for government bonds for emerging markets.
The minister said that Egypt will enter the index with 14 issues, with a total value of $24 billion.
Nevin Mansour, adviser to the deputy minister of finance for financial policies, expected that Egypt would attract new foreign investments in local treasury bonds at about $4.4 billion over a period ranging from six months to a year after Egypt entered the JP Morgan emerging market index in October or November.
Mansour explained that Egypt will receive a 1.78 percent share of any investments that will be pumped into the index and that the inclusion on the index allows international investment banks to evaluate the performance of Egyptian debt instruments and their trading movements, which will result in attracting new foreign investments.