Egypt to tap local market for financing: Beblawi

Reuters, Wednesday 7 Sep 2011

Government has no immediate plans to issue an international bond says Egyptian finance minister at a meeting in the Emirates

No international bonds needed, says Beblawi (Photo: Reuters)

Egypt has no plans to issue an international bond currently and will rely on local market to meet its financing requirements, the country's finance minister said on Wednesday.

When asked if the country was looking at an international bond sale, Hazem el-Beblawi said, "International markets? No. Internal? We issue bonds regularly, locally."

He also said inflation in the North African country is 'relatively under control' at a meeting of Arab finance ministers in the United Arab Emirates capital Abu Dhabi.

Egypt's central bank kept its benchmark interest rates on hold last month reflecting continued concern about inflation and analysts expect rates to remain unchanged.

"Inflation is relatively under control but we have to be vigilant and follow vigilant policies to avoid uncontrolled financial situations," Beblawi said.

The North African country's economy has been hard hit by popular uprising that ousted Hosni Mubarak earlier this year and kept investors on the sidelines. The economy contracted in the first six months of 2011 and growth is projected to remain weak in the second half.

"The main problem is for stability to return which will reassure investors from the inside and outside, basically a return to normality, which we are getting close to rapidly," Beblawi said.

Egypt plans to finance its budget deficit for the fiscal year that began on July 1 mainly by selling LE120 billion (US$20.1 billion) in domestic treasury bills and bonds after the ruling military council turned down a $3 billion funding package that the Finance Ministry had sealed with the IMF.

It plans to auction LE12 billion ($2.01bn) of treasury bills on Thursday and Sunday, its central bank said.

Short link: