Egypt Moves Ahead with $2 Billion Sukuk Plan Amid FX Pressures

20/04/2025

Egypt is moving forward with plans to issue USD 2 billion in sovereign sukuk throughout 2025, as part of its strategy to diversify funding sources and strengthen its presence in Islamic finance markets. Finance Minister Ahmed Kouchouk confirmed the upcoming issuance in a statement to Reuters, noting that the government has already appointed a group of international banks to manage the process.

Alongside the sukuk issuance, the government is also exploring debt-for-investment swaps modeled after last year’s Ras El Hekma agreement, as it looks for innovative ways to attract foreign currency inflows in the face of ongoing pressure on the Egyptian pound, which recently hit a new low.

According to a senior official speaking to EnterpriseAM, the same banks that led Egypt’s debut sukuk in February 2023—HSBC, Citibank, Dubai Islamic Bank, First Abu Dhabi Bank, and Abu Dhabi Islamic Bank—will return to manage the 2025 offerings. While initial reports from Asharq Business placed the value of the issuance at around USD 1.5 billion, this figure has been confirmed by government sources, suggesting that the final offering may be distributed across multiple phases.

The banks involved are expected to begin promoting the sukuk to investors in the Gulf and East Asia over the coming weeks. Although a precise timeline has not yet been confirmed, the issuance process is slated to begin this quarter, with marketing and roadshow activities projected to last around two months.

The sukuk will likely be structured in up to three tranches with staggered maturities—a move designed to reduce yields and attract a wider pool of investors. Despite recent economic volatility, the Egyptian government appears determined to push ahead with efforts to secure long-term, diversified financing and maintain momentum in its fiscal reform agenda.

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