Egypt - Partial Credit Guarantee (PCG) to Support an Inaugural Sustainability Panda Bond Issue by the Arab Republic of Egypt

The proposed operation is a Partial Credit Guarantee (PCG) for an amount not exceeding USD 345 million to support the mobilization of sustainable financing in the Chinese renminbi capital markets by the Arab Republic of Egypt through the issuance of an Inaugural Sustainability Panda Bond. The Bond proceeds will be deployed towards various sustainable and green projects under Egypt’s Sovereign Sustainable Financing Framework (SSFF). The project is structured around a single component, which is facilitating access to the Chinese capital markets on competitive terms to fund green expenditures. The Panda Bond issuance aims to demonstrate Egypt’s leadership in structuring and penetrating new markets and developing sustainable finance in Africa and the Middle East region which will pave the way for other RMCs. This will support the credit rating uplift and de-risk Egypt issuance and will enable Chinese investors to acclimatise to Egypt risk for future issuances. The project contributes to climate finance, with 342 million USD of the total approved amount dedicated to adaptation.