31 Jan 2022

Today marks Egypt’s official return to the JPMorgan Emerging Market Bond Index (EMBI) after about 10 years of absence since the Egyptian Revolutions of the Arab Spring. Egypt is one of only two countries from the Middle East & Africa that are included in the index.

Egypt has been hard at work for the past couple of years to conform to JPMorgan’s requirements for index inclusion. These requirements involve extending the duration of government debt, making adjustments to the yield curve, and increasing the holdings of foreigners in Egyptian government debt. JPMorgan had announced in October 2021 that they have approved the re-inclusion of Egypt in their index with an estimated weight of 1.85%.

JPMorgan stated that 14 categories of Egyptian government bonds denominated in Egyptian Pounds are eligible for inclusion. These bonds have a total value of USD26bn, an average return of 14.9%, and durations between 9 months and 2 years. JPMorgan’s analysts estimated that Egypt’s local currency bond market would receive inflows ranging between USD1.4-2.2bn as a result of inclusion in the index.

(Source: al-Ahram (English) (Arabic), Daily News Egypt (English), Egypt Today (English), al-Sharq al-Awsat (English), Arab News (English), al-Maal, Mubasher, Hapi Journal, al-Youm al-Saabe, al-Masry al-Youm, al-Shurouk, al-Dustour, al-Watan, Akhbar al-Youm, Masrawy, Sada el-Balad, al-Arabiya, CNN)