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| ROUND UP: The month at a glance |
2000 BUDGET APPROVED:
The Cabinet in March approved a £E 99.4 billion draft budget
for the coming fiscal year that would boost spending for social
services and maintain subsidies on key foodstuffs, the nation's
semi-official newspapers reported. The draft envisions revenues
of £E 90.6 billion, which would produce a deficit of £E
8.8 billion, or 3 percent of the nation's estimated fiscal-2000
gross domestic product, which Prime Minister Kamal El-Ganzouri has
put at £E 298 billion.
CIB OFFERS BONDS:
Commercial International Bank (Egypt), the nation's largest bank
not owned by the state, is offering £E 300 million in bonds
as part of a plan to raise about £E 1 billion in 1999. Hisham
Ezz Al-Arab, CIB's new deputy managing director, said that the bank
will use the funds to expand its retail network, stretch out its
liabilities and build a direct-investment portfolio. Up next: a
eurobond offer by the summer, a capital increase by year's end and
perhaps an offer of subordinated debt.
CURRENT ACCOUNT WEAKENS:
Provisional figures from the Central Bank show Egypt's quarterly
current account deficit widened to $451 million in the second quarter
of the fiscal year ending June 30 from $266 million in the first
quarter, as the nation's balance of trade fell further into the
negative. Egypt's balance of trade deficit widened to $1.8 billion
in the second quarter from $1.5 billion in the first quarter.
HSBC WINS MANDATE:
HSBC Investment Banking has won a mandate from Aswan Development
& Mining Co. to arrange a loan package of around $420 million
to finance the company's vertically integrated steel-producing project.
The U.S. dollar-Egyptian pound loan is expected to take about nine
months to arrange. Aswan Iron & Steel Co., in which Aswan Development
& Mining Co. holds a 60 percent stake, will produce steel billets
and rebars for the local and export markets once it begins operations
in about 30 months. HSBC and the company expect total finance needs
to reach $650 million to $750 million.
INFLATION SLOWS IN FEBRUARY:
Egypt's consumer price index rose 3.7 percent in the 12 months to
the end of February 1999, slower than the 3.8 percent rate in the
12 months to the end of January 1999. Consumer prices rose 0.2 percent
in February itself, compared with a 0.4 percent rise in January,
the Central Agency for Public Mobilization & Statistics said.
Egypt's CPI rose by 4.3 percent in the 12 months to the end of February
1998
OIL TERRITORY OFFERED:
Egypt's state petroleum authority opened its first 1999 bid round
in March by offering 15 blocks covering a total of 171,374 square
kilometers for oil and gas exploration and development. The offerings
by the Egyptian General Petroleum Corp. include two blocks in the
deep waters of the Mediterranean, an area of high interest in last
year's bid rounds. Bids are due Oct. 31.
RESERVES FALL BELOW $20 BILLION:
Egypt's net international reserves fell to $19.8 billion in December
1998 from $20.0 billion in November, reaching their lowest level
since they last dipped below $20 billion in April 1997, the Central
Bank of Egypt reported. Egypt's net international reserves stood
at $20.2 billion in December 1997, but analysts said the Central
Bank has had to spend down its reserves to meet demand for dollars.
NEW T-BOND TRANCHE:
The Ministry of Finance offered £E 2 billion in 10-year treasury
bonds in April at a fixed annual rate of 10 percent. The offering
was Egypt's second try at issuing bonds at that maturity, the nation's
longest. Investors shunned the first offering in February, whose
yield of 9.5 percent was seen as too low.
TOURISM STILL WEAK:
The number of tourists visiting Egypt rose to 301,000 in December
1998 from 178,000 in December 1997, but remained substantially below
the pre-crisis total of 368,000 in December 1996. Tourism has yet
to re-cover fully from the November 1997 Luxor massacre. Net revenue
from travel - a broad measure of tourism - fell to $726 million
in the second quarter from $825 million in the first quarter.
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