Egypt Issues $500 Million Samurai Bond with AfDB Backing

Egypt has issued 80 billion Japanese yen ($500 million) in sustainability-linked samurai bonds backed by a partial credit guarantee from the African Development Bank (AfDB), as the country seeks to diversify its external financing sources and extend its debt maturity profile.

The issuance comprises two tranches, including a five-year bond rated AA+ and a 10-year bond rated AA, according to the AfDB.

The transaction marks Egypt’s latest effort to expand its access to international capital markets while reducing reliance on traditional sources of external borrowing. Proceeds will be directed toward eligible sustainable investments under Egypt’s Sovereign Sustainable Financing Framework, including healthcare, education, renewable energy, energy efficiency, climate adaptation, water management, digital infrastructure and inclusive economic development.

The bond comes as emerging markets face higher financing costs and increased volatility linked to geopolitical uncertainty and shifting global interest rate expectations. The AfDB’s AAA credit rating and partial credit guarantee helped Egypt secure longer-term financing on competitive terms, the development bank said.

Egypt’s Finance Minister Ahmed Kouchouk said the guarantee would support the country’s efforts to access innovative financing instruments and fund sustainable development priorities.

“We deeply value the African Development Bank’s continued partnership and its confidence in Egypt’s economic reform agenda. This partial credit guarantee helps Egypt further diversify its financing through innovative sustainable financing instruments. Under Egypt’s Sovereign Sustainable Financing Framework, the Sustainability Samurai Bond will channel long-term resources to priority investments in human capital, sustainable infrastructure, climate action and inclusive growth, in line with Egypt Vision 2030,” Kouchouk said.

“In today’s volatile global environment, the catalytic role of multilateral development banks is more important than ever,” Kouchouk added. “Their support helps emerging and developing economies maintain access to international capital markets, mobilise private investment and finance sustainable development priorities. We value the African Development Bank’s partnership in advancing these shared objectives and look forward to further expanding our successful cooperation.”

Egypt has previously positioned itself as a pioneer in sustainable sovereign financing in Africa, becoming the first African sovereign issuer to access the Chinese Panda Bond market and establishing a framework aligned with international standards for sustainable expenditure.

Ahmed Attout, director of the AfDB’s Financial Sector Development Department, said the transaction demonstrated the role of multilateral institutions in helping African countries attract private capital.

“This operation demonstrates how the Bank’s partial credit guarantee can help regional member countries mobilise private capital and access long-dated financing on competitive terms. By leveraging the Bank’s AAA credit rating, the transaction supports Egypt’s efforts to diversify the currency composition of its external debt while mobilising resources for sustainable and inclusive growth,” Attout said.

“At a time of heightened market volatility, the Bank’s support also plays an important counter-cyclical role by helping preserve Asian market access for the Arab Republic of Egypt,” he added.

The AfDB said the operation supports its strategy of strengthening capital markets, increasing private investment and expanding sustainable financing across Africa.

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