The government of Israel has filed a prospectus with the New York Stock Exchange for a $5 billion debt offering, according to a report by Bloomberg.
The reason for the offering is not known, and it can be carried out at any point over a year. Analysts expect the offering to take place in the first quarter of 2022, in order to finance the purchase of additional vaccines against Covid-19.
Market conditions for a sovereign debt offering are good, but it is too early to tell what the price and interest rate will be.
The Israeli government made its most expensive debt offering last March, at the height of the coronavirus crisis, when it raised a $1 billion 100-year bond at annual interest of 4.5%, and a $2 billion 30-year bond at 3.875%. This debt will cost Israeli taxpayers, their children, grandchildren and great-grandchildren about $10 billion.
A senior economic source told "Globes", "The fund raising is intended to finance the deficit and reduce pressure on the local market, although in the end the dollars will have to be converted. At the same time, the impression that the NIS 7 billion raised by the Ministry of Finance yesterday indicates that the deficit is narrowing seems to be misleading."
Published by Globes, Israel business news - en.globes.co.il - on July 1, 2021
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