Egypt Sells $2.7 Billion Euro Notes to Finance Budget Deficit

By Yomna Yasser On May 30, 2013

Egypt, the second-most indebted Arab country, sold $2.7 billion of 4.25 percent euro notes to help finance the Middle East’s highest budget deficit.

The debt was issued yesterday for trading on the regulated Main Securities Market of the Irish Stock Exchange, the Finance Ministry said in an e-mailed statement. HSBC (HSBA) and QNB Capital managed the sale of the notes due in November 2014, according to data compiled by Bloomberg.

The sale was part of the country’s $12-billion Euro Medium-Term Note Program which will be “used to finance a portion” of the country’s deficit in any given fiscal year, the ministry said. The budget gap may widen to as much as 11.7 percent of economic output, in the year that ends next month, former Finance Minister El-Morsy Hegazi said in April.

Qatar pledged $3 billion on April 10 to support the ailing Egyptian economy, taking the total aid provided by the Persian Gulf nation to $8 billion. The funds were to be used to buy bonds and had been finalized, Egyptian presidential spokesman Omar Amer said April 30. Finance Ministry officials weren’t available to comment on whether the bond sale was part of the Qatar aid package.

Bloomberg