$450 million Eurobond issue by end of 2014

The government plans to issue a $450 million Eurobond by the end of this year to meet the country's funding needs, according to Finance Minister, Ali Hassan Khalil.

The government plans to sell additional Eurobonds, over the next three years. “We have sent a draft law to Parliament to approve the issuance of $4.4 billion of Eurobonds. We are hoping to get the approval by next month,” Khalil said. Parliament is expected to meet in November.

“The issues would cover the needs of Lebanon for 2015 through 2017, which equal $4.4 billion. The approval will be for this amount but it will not be issued all at once,” Khalil said.

Khalil described the request as a normal legislative procedure that allows the Ministry to resort to the market, when there is a need.

He described the overall fiscal situation as stable and said the economy was already showing signs of recovery. For example, for the first time in three years the country registered a budget surplus and a slight increase in its balance of payments this year, he said.

In its May Eurobond issue, Lebanon sold its long-term, 10-year treasury bonds at the lower interest rate of 7.28, down from 8.24, which Khalil said was a sign that investors’ confidence remains high.

He hoped the cabinet would approve the 2015 budget soon, in which he suggested several tax increases to raise revenues and cover spending.