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Lebanon Studies Eurobond Decision as Due Date Nears

A graffiti that reads in Arabic, "Molotov cocktails are coming," has been painted on a concrete wall installed by authorities to keep anti-government protesters far from the main entrance of the Central Bank, background, during ongoing protests against the Lebanese government, in Beirut, Lebanon, Saturday, Feb. 1, 2020. (AP)
A graffiti that reads in Arabic, "Molotov cocktails are coming," has been painted on a concrete wall installed by authorities to keep anti-government protesters far from the main entrance of the Central Bank, background, during ongoing protests against the Lebanese government, in Beirut, Lebanon, Saturday, Feb. 1, 2020. (AP)
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Lebanon Studies Eurobond Decision as Due Date Nears

A graffiti that reads in Arabic, "Molotov cocktails are coming," has been painted on a concrete wall installed by authorities to keep anti-government protesters far from the main entrance of the Central Bank, background, during ongoing protests against the Lebanese government, in Beirut, Lebanon, Saturday, Feb. 1, 2020. (AP)
A graffiti that reads in Arabic, "Molotov cocktails are coming," has been painted on a concrete wall installed by authorities to keep anti-government protesters far from the main entrance of the Central Bank, background, during ongoing protests against the Lebanese government, in Beirut, Lebanon, Saturday, Feb. 1, 2020. (AP)

Lebanon's cash-strapped authorities are struggling to decide what to do about a $1.2 billion Eurobond maturing in March but are leaning towards repayment for foreign holders and a swap for local investors, political and banking sources said on Tuesday.

Lebanon, which has never defaulted on its hefty debt, is in the throes of a financial and economic crisis that has shattered confidence in banks and ignited protests against a political elite blamed for steering the country towards collapse.

A government source and two senior political sources told Reuters that big differences remained over options: pay in full, ask local holders of the issue to swap for longer-dated notes delaying payment by at least 10 years, or simply not pay.

Two of those sources and three senior bankers said a swap would ease pressure on dwindling foreign currency reserves and buy time. Three sources said the government has not initiated any steps for a default scenario.

Lebanon's dollar bonds have gained in recent days, with the rally particularly pronounced among shorter-term bonds, signaling growing expectations that the government might pay its most immediate debt obligations.

The country has $2.5 billion in principal and $1.9 billion in coupon payments on Eurobonds due in 2020.

The March 2020 issue has added 12% in the past four trading sessions and was trading at 84.6 cents to the dollar on Tuesday, according to RRPSBONDS data.

In contrast, Lebanon's longer-dated bonds are trading at 50 cents to the dollar or lower, indicating a higher probability of a debt default or restructuring at some point.

The government source said that Lebanon, grappling with one of the world's heaviest debt burdens, would not be able to avoid a debt restructuring further down the road and would need assistance from the International Monetary Fund, which would require consensus in Lebanon's fractured political landscape.

"Kicking the can down the road by paying means a lot of money out of scarce resources and there are more maturities coming in April and June, so it's only a few months of extra breathing space," said Paul McNamara, investment director at asset manager GAM.

The two political sources said Prime Minister Hassan Diab preferred making the March payment on time to avoid any blemish on the country's reputation as his government, formed last month, tries to win back the confidence of international donors.

"He does not want to start his term with a default on debt obligations and give any negative sign to the international community," one of the political sources told Reuters.

Rating agencies have warned a swap would constitute a selective default.

One of the senior bankers said he expected the government to ask domestic holders to agree on a swap. "This is bad for the banks ... but it's not like we have much of a choice," he said.

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Bahraini Transport Minister to Asharq Al-Awsat: Each Country to Finance Its Share of Gulf Railway Project

A conceptual rendering of the Gulf railway interconnection project. (X)
A conceptual rendering of the Gulf railway interconnection project. (X)
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Bahraini Transport Minister to Asharq Al-Awsat: Each Country to Finance Its Share of Gulf Railway Project

A conceptual rendering of the Gulf railway interconnection project. (X)
A conceptual rendering of the Gulf railway interconnection project. (X)

The Gulf Cooperation Council (GCC) member states took a new step toward completing the railway interconnection project by signing the project's general agreement in Bahrain on Sunday. This comes as part of efforts to establish an integrated transport network linking the six nations and boosting the movement of passengers, goods, and commercial trade among them.

Bahraini Minister of Transportation and Telecommunications Dr. Sheikh Abdulla bin Ahmed Al Khalifa told Asharq Al-Awsat that each country will fund and execute the portion of the project located within its territory.

Meanwhile, the costs, fees, and expenses associated with the shared interconnection components among member states will be determined collectively, he added.

He explained that the agreement establishes a joint framework for the project's execution and operation, while defining the obligations of member states and their coordination mechanisms.

He noted that the network, which extends some 2,117 kilometers, aims to transport 6 million passengers and 200 million tons of freight by 2030, with the figures projected to rise to more than 8 million passengers and 271 million tons of freight by 2045.

The project spans from Kuwait, passing through Saudi Arabia, Bahrain, Qatar, and the UAE, all the way to Oman, with the goal of achieving full network operations by December 2030.

According to the minister, interconnection lines between adjacent countries can become operational as soon as their components are completed, without the need to wait for the entire Gulf network to be finalized.

National financing and potential partnerships

On private sector participation, Al Khalifa said that it remains one of the viable options for financing, executing, or operating certain components of the project, depending on the outcomes of economic and financial studies. He stressed that there is no unified public-private partnership model approved across the entire network.

There are currently no pre-existing agreements with specific international partners to finance or execute the project, he said. However, the expertise of global companies in the fields of design, engineering, technology, and operating systems could be utilized based on the project's needs and its various phases.

Bahraini Minister of Transportation and Telecommunications Dr. Sheikh Abdulla bin Ahmed Al Khalifa.

Concerning the project's announced completion rate, the minister explained that the 50 percent figure represents the average progress achieved across member states, and does not mean that half of the construction work for the entire Gulf network has been completed.

The project's cost estimates are currently undergoing review and updates in light of economic shifts, rising prices for materials and services, construction costs, and inflation, he revealed without specifying an updated total cost at the present time.

Returns beyond passenger and freight transport

Al Khalifa said that the economic impact of the project is not limited to facilitating passenger movement and freight transport, but extends to improving supply chain efficiency, boosting trade among GCC countries, and linking industrial centers, economic zones, and logistical hubs, as well as supporting employment and investment opportunities.

He added that determining the project's exact contribution to the gross domestic product (GDP) or estimating expected savings in time and costs remains premature, given that returns vary depending on transport routes, the nature of the cargo, and the points of origin and destination.

In light of the challenges facing maritime navigation in the region, the minister stressed that the Gulf railway network is not intended to serve as a substitute for maritime transport. Instead, it acts as a complementary route that boosts transport options and connectivity among GCC nations, increasing the resilience of supply chains against disruptions that could affect various modes of transportation.

He noted that integration between ports, roads, railways, and airports will strengthen the flexibility of the Gulf transport system, while connecting to broader international logistical corridors remains a future possibility contingent on completing studies, understandings, and coordination with the relevant countries and entities.

King Hamad Bridge to link Bahrain and Saudi Arabia

Regarding the connection between Bahrain and Saudi Arabia, Al Khalifa explained that the King Hamad Bridge project includes road lanes and railway lines, enabling the international passenger station in Bahrain to connect with the Saudi railway network and forming one of the essential components for completing the Gulf interconnection.

He added that work is underway on the privatization procedures for the King Fahd Causeway Authority, alongside completing the necessary studies and procedures to transition to the execution of the new bridge project.

Achieving the connection between Bahrain and Saudi Arabia is a fundamental requirement for operating the railway line between the two countries within the project's targeted timeframe in December 2030,e he said.

Business

Egypt Seeks Faster Progress on Libya Gas, Refining and Power Projects

Egyptian Foreign Minister Badr Abdelatty speaks during a press conference with Minister of Information Diaa Rashwan (not pictured) in Cairo, Egypt, March 25, 2026. (Reuters)
Egyptian Foreign Minister Badr Abdelatty speaks during a press conference with Minister of Information Diaa Rashwan (not pictured) in Cairo, Egypt, March 25, 2026. (Reuters)
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Egypt Seeks Faster Progress on Libya Gas, Refining and Power Projects

Egyptian Foreign Minister Badr Abdelatty speaks during a press conference with Minister of Information Diaa Rashwan (not pictured) in Cairo, Egypt, March 25, 2026. (Reuters)
Egyptian Foreign Minister Badr Abdelatty speaks during a press conference with Minister of Information Diaa Rashwan (not pictured) in Cairo, Egypt, March 25, 2026. (Reuters)

Egypt aims to accelerate energy projects with Libya, including gas pipeline links, refining of Libyan crude in Egypt and an electricity interconnection, Egyptian Foreign Minister Badr Abdelatty said late on Saturday.

Abdelatty's comments were in ‌a ministry ‌statement after a meeting ‌with ⁠Libya’s acting oil ⁠and gas minister Khalifa Abdulsadek in Tripoli.

Abdelatty also ‌called for cooperation on petroleum products and the completion of projects to refine Libyan ‌oil in Egypt and re-export it, the statement said, ⁠adding ⁠that Abdulsadek had said that Libya would continue implementing existing projects and would visit Cairo soon to continue technical talks with Egypt’s petroleum and electricity ministers.

The statement did not provide details on costs or the status of the projects.

Business

GCC: Railway Agreement Sets Joint Framework for Project Implementation and Operation

GCC transport ministers pose for a group photo following the 27th committee meeting in Kuwait. (GCC Railway Authority)
GCC transport ministers pose for a group photo following the 27th committee meeting in Kuwait. (GCC Railway Authority)
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GCC: Railway Agreement Sets Joint Framework for Project Implementation and Operation

GCC transport ministers pose for a group photo following the 27th committee meeting in Kuwait. (GCC Railway Authority)
GCC transport ministers pose for a group photo following the 27th committee meeting in Kuwait. (GCC Railway Authority)

Jasem Albudaiwi, secretary-general of the Gulf Cooperation Council (GCC), said on Sunday that the signing of the General Agreement on the GCC Railway Project marked an important step toward establishing an integrated regional transport network.

He said the network would facilitate the movement of citizens and residents, ease freight transport, boost intra-GCC trade efficiency and strengthen member states’ economic competitiveness and the region’s position in regional and international trade.

Albudaiwi's remarks came at the signing ceremony in the Bahraini capital, Manama, on Sunday, held under the patronage and in the presence of Bahrain’s Crown Prince and Prime Minister Salman bin Hamad Al Khalifa.

He said the project reflected the GCC’s shared ambition to connect member states and improve mobility and trade by linking their economic and industrial hubs, ports and logistics centers.

He added that the project would create opportunities for safe, reliable, affordable and environmentally friendly transport services that meet development needs, serve the aspirations of future generations and strengthen economic integration among GCC states.

Albudaiwi said the agreement sets a common framework for member states to implement and operate the project in coordination with their national railway networks, while establishing mechanisms and a timetable to accelerate its completion.

Albudaiwi praised GCC leaders and transport ministers for their support of strategic regional projects, thanking Bahrain’s crown prince and prime minister for hosting the signing ceremony and officials for advancing the railway project.