Egypt ready to join JP Morgan bond index late January 2022 – minister

Egypt is ready to officially join the JP Morgan emerging-market government bond index starting late January 2022, Minister of Finance Mohamed Maait reitrated on Sunday.

After almost three years of discussions, JP Morgan announced in October that Egypt would join EMBI by the end of January 2022. The U.S. investment bank said the North African country is eligible to join the index with an estimated weight of 1.8 percent with 14 Egyptian pound government bonds worth a total of $26 billion.

90 percent of the investors JP Morgan surveyed supported Egypt’s inclusion, it added.

Egypt is also set to join the JP Morgan Environment and Governance Index by end of January 2022 with 1.1 percent of the index on the back of the country’s issuance of green bonds in October 2020, Minister Maait said.

The action will allow large investment funds and foreign investors to invest in Egypt’s debt instruments in local currency, he added.

“$1 billion in new investments are expected to be pumped in the Egyptian governmental equity market as a result of the action,” the minister said.

In April, JP Morgan announced placing Egypt and Ukraine under review for inclusion in the EM index on the back of their steady improvement in liquidity and access to onshore government bond markets on the foreign investor level.

Egypt was removed from the JP Morgan index in 2011 due to economic and political instability amid the 2011 uprising, which eroded the country’s ability to meet its requirements.

The re-inclusion is making Egypt the second country in the Middle East and Africa to join the index, after South Africa.