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Egypt issues second $1 billion sovereign sukuk amid regional tensions

Businessmen Team economy 25 June 2025 04:03 PM
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Egypt issues second $1 billion sovereign sukuk amid regional tensions

Ministry of Finance successfully returned to international markets, issuing its second Sharia-compliant sovereign sukuk worth $1 billion through a private placement for the 2024/2025 fiscal year, the ministry announced. The move comes despite escalating regional tensions and economic challenges that have roiled global markets.

The ministry attributed the successful issuance to a "significant and noticeable improvement" in Egypt's economic conditions and key financial indicators.

The second sukuk offering carries an annual coupon of 7.875% and a three-year maturity. It aligns with the ministry's strategy to diversify its funding sources across markets, instruments, and investors, demonstrating its ability to meet financial targets despite evolving economic and political landscapes.

This latest issuance follows Egypt's first sovereign sukuk in February 2023, as part of its $5 billion international sovereign sukuk program. The initiative aims to diversify financing tools, currencies, and investor segments, while also extending debt maturity and reducing external borrowing costs.

Kuwait Finance House (KFH), a leading global Islamic bank, fully invested in the private placement, strengthening financial ties between Egypt and Kuwait.

The Ministry of Finance reiterated its commitment to reducing the external debt of budgetary entities by $1 billion to $2 billion this year, with initial indicators suggesting these targets are achievable.