(Ecofin Agency) - The yuan-denominated bond issuance plan is announced after the country postponed a Sukuk issuance and a USD-denominated Eurobond. 

Egypt plans to issue US$500 million in Yuan-denominated bonds to diversify its financing sources, Finance Minister Mohamed Maait (photo) announced on Monday, August 29.

"The Ministry of Finance has begun talks with Chinese authorities to issue more than US$500 million in yuan-denominated bonds. It is also reflecting on the selection of the banks that will arrange the issue,” he said during a press conference. 

The government official added that Egyptian authorities are also considering the issuance of yen-denominated green bonds. Meanwhile, he informed, a US$2 billion Sukuk issuance operation and a USD-denominated Eurobond issuance operation have been postponed due to "high interest rates" and "difficult market conditions.”

Egypt expects a 15 percent increase in spending and a 14.5 percent increase in its budget deficit in the 2022-2023 fiscal year, according to the state budget passed by parliament last June.

On Monday, August 22, the country announced that it was close to an agreement with the International Monetary Fund (IMF) on a new multi-billion dollar financing program to support the country's economy, which has been hit hard by the Russia-Ukraine conflict. Also, in a recent analysis, U.S. bank Goldman Sachs estimated the country would need more than US$15 billion to meet its financing needs over the next three years.

Last March, Egypt raised US$500 million by issuing yen-denominated bonds.  Six months earlier, it had raised US$750 million by issuing green bonds, becoming the first MENA country to issue such bonds to finance low-carbon projects.