According to a report by the Belgian Ecofin News Agency on May 23, in cooperation with the African Development Bank, Egypt is preparing to issue the first batch of African Panda bonds (Panda bonds refer to RMB bonds issued by foreign institutions in China – note on this website). For the African Development Bank, this is the first step in its efforts to facilitate resource mobilization in African countries.
According to reports, with the support of the African Development Bank, Egypt is about to become the first country on the African continent to issue panda bonds in the Chinese market, which will be the first case in the African financial sector. Akinwumi Adesina, president of the African Development Bank, announced at a press lunch held in Sharm El Sheikh on the sidelines of the African Development Bank’s annual meeting on the 22nd that the bank approved a large amount of financial support last week – 345 million U.S. dollars part of the guarantee to support this initiative.
The deployment is aimed at facilitating Egypt’s access to China’s bond market, allowing the Arab country to fund environmental and social projects, the report said. Through this initiative, Egypt plans to raise the equivalent of $500 million to support green transport, renewable energy, energy efficiency and sustainable water management, among others.
The bonds were initially scheduled to be issued in 2022, but had to be delayed due to uncertainties in the global financial environment. “We’re just waiting for the right moment,” said Deputy Finance Minister Ahmed Kushuk.
“The facilitation conditions should improve Egypt’s financial rating, allowing it to attract international investment on favorable terms,” said Mohamed Aziz, general manager of the African Development Bank’s North Africa region.
The success of the operation “will hopefully open the way for other African countries,” said Marie-Lohr Arkin-Olubad, vice president for regional development, business integration and execution at the African Development Bank.
According to reports, Egypt’s International Cooperation Minister Rania Mashat stressed that the agreement strengthens the strategic partnership with the African Development Bank and diversifies Egypt’s funding sources. “This agreement with the African Development Bank adds a new dimension to our strategic partnership focusing on the transition to renewable energy and sustainable infrastructure project financing,” she said.