Minister of Finance, Mohamed Maait, announced today that Egypt officially joined the JP Morgan Emerging Markets Bonds Index (EMBI) to become one of only two countries in the Middle East and Africa to join this index. Egypt is expected to join the EMBI with 14 issuances worth around $26 billion.
Egypt will have a share of 1.85% in the index, enabling major investment funds and more foreign investors to invest in Egyptian debt instruments. Maait stated that with joining the EMBI, $1 billion new additional investments will be pumped into the Egyptian government securities market from treasury bills and bonds, and then achieve the debt management strategy in reducing costs.
Egypt returns to the index after being delisted from the index in 2011, with the government working towards its comeback over the last 3 years. Egypt was able to achieve the index’s requirements, including extending the life of government debt, adjusting the yield curve, and raising the percentage of foreign investors’ participation in government financial instruments.
The return is in line with the Egyptian government’s efforts to reduce the cost of public debt as part of the country’s economic reforms.
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