-CAIRO: Investment certificates for the Suez Canal expansion project will be issued in the local currency and the dollar certificates will be suspended, the governor of the Central Bank of Egypt (CBE) Hisham Ramez announced Sunday.
The government will issue the certificates to raise 60 billion EGP ($8.39 billion) to finance the Suez Canal expansions with the aim of increasing the capacity of the vital waterway.
“The certificates issuance draft law allows the Suez Canal Authority to issue dollar-denominated certificates, but we will focus on the EGP certificates in the current phase to meet the great turnover from the public. Issuance of the dollar denominated certificates will be delayed,” Ramez said during a press conference Sunday.
Six million certificates were printed to raise the needed finances, Ramez added.
The CBE has monitored a growing demand from banks’ clients to exchange part of their hard currency-deposits to the local currency, in preparation to buy the Suez Canal certificates, added Ramez.
The government had initially announced the idea of issuing dollar-denominated certificates for Egyptians abroad, but the CBE governor said they would be able to buy the certificates in Egyptian pounds through local banks with ties to the issuant banks in Egypt.
The Cabinet has approved the issuance of the Suez Canal Investment Certificates Law, and the legislation will be submitted to President Abdel Fatah al-Sisi for ratification, Ramez revealed Sunday.
The certificates will come with a lifetime of five years and a 12 percent interest rate. The certificates issued in local currency will be offered in three categories: 10 EGP ($1.40), 100 EGP and 1,000 EGP at a 12 percent interest rate.
“Revenues from the 10 EGP and 100 EGP certificates will be paid after five years, while the 1,000 EGP certificates will be paid quarterly,” Ramez detailed.
The National Bank of Egypt, Bank Misr, Banque du Caire and Suez Canal Bank will be in charge of issuing the investment certificates, and have been directed to establish specific outlets for the certificate sale.