Egypt to plunge headfirst into the Sukuk mart (By IFN)

Egypt to plunge headfirst into the Sukuk mart

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EGYPT: The Egyptian Ministry of Finance has announced plans to finance up to 17 developmental projects through Sukuk, during its annual Public Private Partnership Summit held on the 24th March — just four days after the government approved the country’s much-anticipated Sukuk law. The project financing Sukuk announcement contradicts what many market players have initially predicted; which is that the Egyptian government will only go forth with such an issuance once it has gained the International Monetary Fund’s US$4.8 billion financing package. However, although all has been quiet on the IMF front, global conglomerate the IDB has pledged up to US$6 billion of investments into the country, providing a boost to the government’s development plans. In the meantime, GCC countries are also being actively encouraged to invest in the North African renewable energy sector with global energy firm Desertec Industrial Initiative’s CEO, Paul van Son recently calling for more cross-borders trade: “The GCC governments could invest in North Africa for their own long-term use, not just in terms of value for money; but also to create a politically stable climate, and to create more jobs in North Africa in the longer-term,” he noted during a press conference in Dubai. Dubai-based construction firm Arabtec Holding had also recently scored an AED500 million (US$136.07 million) deal to develop a 23-story luxury apartment block in Cairo; illustrating growing GCC interest in the emerging market. With the approval of the Sukuk law and an increase in interest amongst GCC investors in the emerging market of North Africa, things are looking up for the Egyptian Islamic capital markets.