The Egyptian government plans to borrow EGP 1.293trn from the domestic market during November and December 2024, according to divs obtained by Daily News Egypt.

The government intends to use the borrowed funds to repay previous debt instruments and finance the general budget deficit, according to its plan.

The Ministry of Finance aims to issue 36 treasury bill tenders worth EGP 1.150trn and 23 bond tenders worth EGP 143bn before the end of the year.

The Central Bank of Egypt, which undertakes these tasks on behalf of the government, will offer treasury bills and bonds worth EGP 542bn in November and EGP 751bn in December.

The plan outlines that the ministry will issue nine tenders for 91-day treasury bills worth EGP 340bn, nine tenders for 182-day treasury bills worth EGP 335bn, nine tenders for 273-day treasury bills worth EGP 225bn, and nine tenders for 364-day treasury bills worth EGP 250bn.

Additionally, the ministry plans to issue five bond tenders for two years worth EGP 25bn, four “floating-rate” bond tenders for three years worth EGP 8bn, nine fixed-rate bond tenders for three years worth EGP 100bn, and seven floating-rate bond tenders for five years worth EGP 10bn.

Banks operating in the Egyptian market are the largest investors in the government’s treasury bills and bonds, issued regularly to cover the general budget deficit.

These instruments are offered through 15 banks that participate in the “Primary Dealers” system in the “primary market.” These banks resell a portion of the bonds and bills in the “secondary market” to investors, including individuals and local and foreign institutions.

Earlier, the Cabinet approved the draft budget for fiscal year 2024/2025. The government aims to achieve a primary surplus exceeding 3.5% of gross domestic product, reduce the overall deficit in the medium term to 6%, and put the debt-to-GDP ratio on a downward trajectory to reach 80% by June 2027.

This strategy includes setting a legal ceiling for public debt, which can only be exceeded with the approval of the President and the Cabinet, and allocating half of the proceeds from the privatization program to directly reduce government debt while also working to extend debt maturity.

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