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Egypt Mulls US Dollar “Century Bonds”: Minister | ASHARQ AL-AWSAT English Archive 2005 -2017
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CAIRO (Reuters) – Egypt is considering offers from international investment banks to launch 100-year “century bonds” that would help demonstrate appetite for longer-term Egyptian debt, the finance minister said on Wednesday.

Egypt has relied mainly on domestic debt to finance its budget deficit, which was equivalent to 8.1 percent of gross domestic product (GDP) in the financial year to end-June, but has occasionally dipped into international markets.

“I don’t need the money, but we are thinking about it,” Finance Minister Youssef Boutros-Ghali told Reuters by telephone.

He added that a number of investment banks had offered to manage the bond issue, which would be denominated in U.S. dollars.

The government has gradually been lengthening the maturity profile of its international debt, and in April sold $1.5 billion in Eurobonds with maturities of 10 and 30 years.

“Before, we couldn’t issue a five-year note. In 2004, we tested the market and they said ‘forget it’. Then we got a 10-year note, then a 30-year note,” Boutros-Ghali said.

Egypt’s reform-minded government has been working to reduce the country’s budget deficit since it came into office in 2004, but was set back by the 2008 global economic crisis which prompted it to adopt a series of economic stimulus packages.

“We have a very careful borrowing policy that the government has set out,” Boutros-Ghali said.

Egypt’s economy, which was spared the worst of the global economic crisis that began in mid-2008, was buoyed last year by a resurgent tourism industry and Suez Canal receipts, along with resilient construction and gas exports.