Egypt’s Prime Minister, Hisham Qandil, a career bureaucrat with a history of sympathy for the Muslim Brotherhood–who was also educated at Utah State and North Carolina State–has called for economic changes to solve Egypt’s largely self-inflicted financial woes.
Among the measures underway: the issuance of sukuk, also known as Shariah bonds:
A sukuk issuance would mark Egypt’s first use of Islamic bonds. Global sales of bonds that comply with Islam’s ban on interest have soared 86 percent so far this year to $35 billion, according to data compiled by Bloomberg.
The average yield on global sukuk dropped 99 basis points this year to a record 3 percent on Sept. 7, according to the HSBC/Nasdaq Dubai US Dollar Sukuk Index.
“This is something we want to do to enlarge the engagement” of investors who “want to use this tool but are currently unable to,” Qandil said yesterday. After the legislation is prepared, “I hope they will be ready with one or two issuances,” he said, referring to the Finance Ministry.