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Egypt Seeking to Boost Africa’s Financial Resources from International Institutions

A woman works at a factory in Accra, Ghana. (World Bank)
A woman works at a factory in Accra, Ghana. (World Bank)
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Egypt Seeking to Boost Africa’s Financial Resources from International Institutions

A woman works at a factory in Accra, Ghana. (World Bank)
A woman works at a factory in Accra, Ghana. (World Bank)

Egyptian Minister of Planning, Economic Development and International Cooperation Rania Al-Mashat said her country is currently working to boost the financial space available to African countries from international institutions, with the aim to implement the 2063 Development Agenda.

Speaking during the 2024 African Caucus Meeting in Abuja, Nigeria, the minister stressed the importance of the ongoing discussions between the African Group and the World Bank to bolster joint cooperation with one of the largest multilateral development banks, to overcome the development challenges facing African countries, and push towards achieving the Development Agenda.

The meeting, hosted by the International Monetary Fund and World Bank Group governors, aimed to identify ways to accelerate intra-African trade as a catalyst for sustainable economic growth.

“We are working to expand the financial resources available to African countries from international institutions to support the implementation of the 2063 development agenda,” Al-Mashat told the attendees.

She added that Egypt was seeking to integrate more deeply with its African counterparts, as outlined in its Vision 2030 plan, and to promote intra-South cooperation to share development experiences and best practices.

During the meetings, World Bank officials presented the group’s strategy for regional integration in Africa and discussed the initiative that was launched between the World Bank Group and the African Development Bank in April.

The initiative aims to provide electricity to about 300 million people in Africa by 2030, through a partnership between multilateral development banks and private sector investments.

Participants also discussed the means to activate the African Continental Free Trade Agreement, by unifying payment systems at the continent level, enhancing digital transformation efforts, developing sustainable infrastructure, and adopting effective policies towards digital transformation.

Moreover, talks touched on the means to enable startups’ access to financing from the private sector and facilitate trade and regional integration in Africa.

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S&P Expects Saudi Issuances to Continue Domestically, Internationally Driven by Vision 2030

A view of the Saudi capital, Riyadh. (SPA)
A view of the Saudi capital, Riyadh. (SPA)
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S&P Expects Saudi Issuances to Continue Domestically, Internationally Driven by Vision 2030

A view of the Saudi capital, Riyadh. (SPA)
A view of the Saudi capital, Riyadh. (SPA)

S&P Global Ratings anticipates that Saudi issuers will continue to tap local and international capital markets to finance projects under Saudi Arabia’s Vision 2030. The agency expects debt levels to remain manageable, with private sector debt-to-GDP ratios staying below 100% over the next 12 to 24 months.

According to S&P’s report, “Saudi Capital Market Overview: Rising Issuance Levels Are Just the Start”, Saudi companies have dominated issuance activity in recent years. Over the past five years, Saudi entities, including government-related entities, have accounted for roughly two-thirds of non-governmental US dollar-denominated issuances. However, the report predicted that banks will play an increasingly significant role in the future.

The report noted that Saudi issuers have raised over $130 billion in US dollar-denominated issuances over the last five years. This adds to $144 billion raised domestically in Saudi riyals during the same period, driven by Vision 2030 initiatives.

While the government accounts for about 60% of these issuances, the Kingdom’s Vision 2030 has created expansive opportunities in the non-oil economy and banking system, paving the way for future growth, the report underlined.

S&P highlighted the development of Saudi Arabia’s mortgage-backed securities market as a key factor to watch over the next two years. As of the end of September 2024, Saudi banks held more than $175 billion in mortgage financing, most of which carried fixed interest rates but were funded through short-term resources, primarily local deposits.

With declining interest rates, some of these mortgages could re-enter circulation, enabling banks to sell them in the secondary market without incurring losses. This would allow banks to offload mortgage financing from their balance sheets, provided legal challenges surrounding the mortgage-backed securities issuance are resolved or mitigated sufficiently to attract local and international investor interest.

According to the report, developing the mortgage-backed securities market could significantly enhance banks’ financial capacity, enabling them to better support the implementation of Vision 2030. This could occur through existing infrastructure, such as the Saudi Real Estate Refinance Company, or via direct issuances in the capital markets.