Egypt Doesn’t See Sukuk as IMF Loan Substitute, Official Says

Egypt doesn’t see sukuk as a substitute for a $4.8 billion International Monetary Fund loan being sought by the government, an adviser to the finance minister told reporters today.

The sukuk law, which would allow Egypt for the first time to offer Islamic sovereign debt, has been sent by parliament’s upper house to President Mohamed Mursi for approval, and will be implemented in July, the Finance Ministry’s Ahmed Al-Nagar said.

Egypt has been searching for additional funds alongside talks with the IMF on a loan that has been delayed amid political unrest. The government says an IMF accord will restore investor confidence and help revive an economy that has stalled since the 2011 uprising against Hosni Mubarak.

The parliament’s upper house, which is serving as the legislature after the lower house was disbanded last year under court order, approved the sukuk law earlier in the week, capping a months-long process.

The government plans to sell sukuk backed by revenue from electricity and transportation projects under the law, Al-Nagar said.

To contact the reporter on this story: Abdel Latif Wahba in Cairo at alatifwahba@bloomberg.net

To contact the editor responsible for this story: Andrew J. Barden at barden@bloomberg.net

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