Minister of Finance Mohamed Maait stated the launch of the first Egyptian bonds in the Japanese capital markets is a culmination of the efforts of the ministry to raise the efficiency of debt management, diversify sources and financing tools, expand the investor base — taking into account geographical diversity — and optimally exploit any opportunities in global markets.
This contributes to reducing the cost of financing and carrying out development projects to create job opportunities and improve services provided to citizens and their standard of living.
During the celebration of the launch of the first Egyptian bonds to be issued in the Japanese capital markets, the minister said that this offering is a new step in Egyptian-Japanese cooperation, and its value amounted to JPY 60bn, which is equivalent to about $0.5bn.
Maait pointed out that the ministry succeeded in obtaining appropriate pricing for this issue, with the return amounting to about 0.85% per annum for five years, which makes it more distinguished in terms of its low rate compared to rates of return of international issues.
“We succeeded in attracting many Japanese investors through these bonds, which were very popular and indicates their great confidence in the solidity of the Egyptian economy and its ability to achieve its goals, as well as face the current global economic challenges and shocks,” he added.
“Moreover, this issuance is characterised by specifications of a unique nature, given that the Japanese market is different from other international markets, because Japanese investors are more selective in their investment policies and more willing to invest in debt instruments of countries with high credit ratings.”
Furthermore, the minister disclosed that the number of companies operating with Egyptian-Japanese investments in Egypt amounted to 87 companies, with the total amount of investments approaching $1bn in various aspects of activity — whether in the field of engineering industries, transportation services, chemicals, pharmaceuticals, finance, or other activities that support the economy.
“We are looking forward to the introduction of the samurai being the ‘keystone’ to enter Egypt again with new issues in Japanese capital markets in the coming period,” he said.
Furthermore, Maait explained that Egypt previously issued its first public offering of sovereign green bonds in the Middle East and North Africa at a value of $750m in September 2020 for five years at a return rate of 5.25%, which contributed to attracting new investors who prefer green investments in Europe, the US, east Asia, and the Middle East.
Japan’s Ambassador to Cairo Hiroshi Oka said: “We celebrate the issuance of the samurai bonds, which are a joint achievement for Egypt and Japan and contribute to strengthening our relations, which include continuing support for economic reform efforts in Egypt. The last period witnessed an increasing growth in private sector investments in Egypt in a way that reflects the Egyptian side’s interest in strengthening partnership with this important sector, which represents the key to the success of development efforts.”
“The COVID-19 pandemic imposed on all of us many difficult measures and conditions but called on us to join hands and cooperate to confront crises. Moreover, we continue to support steps of reform and economic recovery pursued by Egypt in various fields, and support efforts to organise the COP 27 this November,” he concluded.