2 days ago
Egypt to issue $1bln Islamic bonds for Kuwait: report
Egypt intends to issue $1 billion sovereign sukuk (Islamic bonds) to be confined to Kuwaiti investors as part of a bilateral agreement to boost Kuwaiti investments in the country, a Saudi newspaper has reported.
Asharq Business, quoting three unnamed officials in Egypt and Kuwait, said the bonds would be issued for a three-year term and semi-annual return.
The paper said the plan to issue such bonds was preceded by Cairo's decision this week to allocate 174 square kilometres of land on the Red Sea coast to the finance ministry for use in Islamic bond issuances and in efforts to lower the public debt.
The report said the decision was published in the official gazette, which did not elaborate on how the land would be used.
'This step is essential within the structure of the sukuk issuance, as Islamic Sharia requires that sukuk be linked to real assets, unlike conventional bonds, which are not necessarily based on tangible assets,' Asharq said.
It quoted a Kuwaiti official as saying the $1 billion sukuk issuance is part of an agreement with Kuwait, which is represented by the Kuwaiti Finance House, adding that the bonds would be 'confined to Kuwait and would not be issued in the global market.'
'The agreement for this issuance was reached after Egypt made a formal offer to Kuwait in May to invest $1 billion in three-year international sukuk, to which Kuwait responded positively,' the paper said.
In an earlier report, the daily said Egypt has selected five banks, including three Gulf financial institutions, to act as intermediaries and lead advisors for a sukuk issuance estimated at $one billion to $1.5 billion in the second quarter of 2025.
They include HSBC, Citibank besides Dubai Islamic Bank, First Abu Dhabi Bank, and Abu Dhabi Islamic Bank (ADIB).
Press reports said last month that Egypt is aiming to attract $6.5 billion in new Kuwaiti investments by the end of 2026, with $4 billion expected to be secured within 2025.
(Writing by Nadim Kawach; Editing by Anoop Menon)
