Israel has completed its first bond issue in Asian markets with resounding success, raising $5 billion, the Finance Ministry said Wednesday. The ministry noted that the issue sought to help the government decrease the deficit created by the coronavirus crisis.
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The amount raised is equal to the record set on March 31, when Israel raised $5 billion in a bond issue mainly from US and European investors, to fund the country's emergency bailout program for the economy, which has seen unemployment soar to 26% in a matter of five weeks.
This was the first time Israel has issued bonds in Asian markets, in a move that followed studious planning as part of the country's efforts to attract diverse international investors.
Finance Ministry officials said that the bond issue "saw high demands from some 300 high-quality investors from over 30 countries," not just from Asia, totaling over $10 billion.
The bonds were issued for a period of 40 years, with a 3.8% interest rate.
"The issue will be an important pillar in financing government activity in the near future," said Finance Ministry's Accountant General Rony Hizkiyahu.
Meanwhile, the ministry's Chief Economist Shira Greenberg said that Israel's fiscal deficit as a proportion of GDP will climb to 11% in 2020, placing it third among the member-states of the Organization for Economic Cooperation and Development, after the US and Canada.
The Finance Ministry expects the Israeli economy to shrink by 5.4%, a projection similar to that of the Bank of Israel, which forecast a 5.3% contraction.
