Egypt said it aims to tap the Eurobond market for $1-1.5 billion within weeks, its first such issue since 2007, which analysts said should be well received.

'The markets are favourable. There is a huge demand from investors in London, New York and Asia,' Finance Minister Youssef Boutros-Ghali was quoted as saying in our sister publication, the Gulf Daily News.

'We plan to test the outer limits of maturities. We are testing 20 to 30 years. We are contemplating $1bn to $1.5 billion,' he said.

Analysts had not expected an issue so soon but said it should draw a positive response given low global interest rates and growing interest in investing in Egypt.

'It does come as a bit of a surprise,' said Tarek Elalaily of Beltone Financial. 'More people are starting to look at frontier and emerging markets ... It does make sense for an international investor to diversify sovereign bond portfolio with an allocation to Egypt.'

Mohamed Abu Basha of EFG-Hermes said: 'If you want to issue a Eurobond, now is a good time, because interest rates globally are very low.'

Egypt has emerged from the world financial crisis relatively unscathed. Its economy grew 4.7 per cent in the fiscal year ending last June and a government minister last month forecast 5.5 per cent growth in fiscal 2010-11.

Conservative lending by banks, which are flush with cash, helped the economy weather the crisis along with relatively resilient tourism receipts, earnings from the Suez Canal and remittances from workers abroad.

Boutros-Ghali said the bond issue was not designed to fund the budget deficit. 'I am doing that very comfortably domestically,' he said.

He said the deficit for the current fiscal year could be lower than the government's estimate of 98 billion Egyptian pounds ($18 billion), or 8.4 per cent of predicted gross domestic product, which was based on economic growth of 4.7 per cent. – TradeArabia News Service