Egypt to Issue $500M in Samurai Bonds Next November

Egypt is set to offer Samurai bonds, denominated in Japanese yen, at a value of $500 million by the end of next November, according to Finance Minister, Mohamed Maait. Samurai bonds are instruments issued by foreign borrowers on the Tokyo Stock Exchange. Egypt made its foray in issuing Samurai bonds back in March 2022, raising $500 million, around 60 billion yen at that time. Maait's announcement comes after the North African nation issued Panda bonds (debt securities issued by foreign entities in Chinese currency, Yuan) earlier in October, also worth $500 million. The yields on these Panda bonds stood at 3.5 percent annually for a term of three years, a return deemed as very low as per Maait, considering new and challenging financial market conditions. However, the yields on Egyptian Samurai bonds are higher than the average yield on similar Japanese government bonds that stood at 0.116 percent and three-year Chinese government bonds at 2.389 percent. Earlier this year, Egypt accessed the international bond market selling sovereign bonds for the first time, amassing $1.5 billion for a term of three years – a venture attracting orders worth $6.1 billion, quadrupling the coverage ratio. In recent months, Egypt is seeking to raise between $1.5 to $2 billion in external financing, inclusive of $1 billion through Samurai and Panda bonds before year-end.