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Israel sells record $8bn in global bonds; Israeli firms banned from Chilean air show

Israel sells record $8bn in global bonds; Israeli firms banned from Chilean air show
Bloomberg
By Bloomberg
7 Mar 2024
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Israel sold $8bn of international bonds, the nation’s first such transaction in public markets since the war erupted with Hamas — and its biggest sale of dollar notes on record.

Chile’s government banned Israeli companies from participating in an air and space industry fair scheduled for April, according to a statement from the country’s Defence Ministry.

Chile has about 500,000 people who identify as of Palestinian descent, the largest community outside the Middle East, according to a local Palestine community website.

Israel sells $8bn of international bonds


Israel sold $8-billion of international bonds, the nation’s first such transaction in public markets since the war erupted with Hamas — and its biggest sale of dollar notes on record.

The government issued $2-billion of notes due in five years, $3-billion in bonds maturing in 10 years and $3-billion of notes due in 30 years, according to people familiar with the matter. They asked not to be identified because they were not authorised to speak about it. 

Altogether, the offering reeled in at least $34-billion worth of investor demand, said the people. Such strong appetite for the offering comes as Israel looks to support its economy and carry on the war against Hamas, a group designated a terrorist organisation by the US. While Israel has issued privately placed bonds, this deal marked the nation’s first in public, global markets since the conflict began. 

Given the conflict, Israel is expected to sell a near-record amount of bonds this year in a mix of local and global securities, Bloomberg has reported. 

The war has roiled the Israeli economy, though much of the shock from the initial few weeks has worn off. The war began when Hamas rampaged through southern Israeli communities, killing around 1,200 people and capturing 250. 

More than 30,000 have been killed in Gaza by Israel’s retaliatory air and ground assault, according to the Hamas-run health ministry. International focus has turned to talks about a potential ceasefire in the war, though a deal remains uncertain.

In Israel, the shekel has rallied hard in the past three months and is far stronger than when the conflict started on 7 October. The government’s average dollar yields, meanwhile, have fallen to around 5.7% from a peak of 6.5%, suggesting investors are more confident about the economy’s resilience.

But angst remains in other parts of the market: Israel’s credit-default swaps — or the cost of protecting against a default — remain elevated.

Israeli companies banned from Chilean air show


Chile’s government banned Israeli companies from participating in an air and space industry fair scheduled for April, according to a statement from the country’s defence ministry. It didn’t provide a reason for the decision. 

President Gabriel Boric has condemned Israel’s bombardment of Gaza and recalled the country’s ambassador to Israel. 

Chile has about 500,000 people who identify as of Palestinian descent, the largest community outside the Middle East, according to the local Palestine community website.

Israel may withdraw its military attaché in Chile as a response, local website Ex-Ante reported. It also cited the Israeli ambassador in Chile, Gil Artzyeli, saying that the decision wasn’t a surprise and that since his arrival to Chile he had witnessed only negative gestures to Israel from the Boric administration. DM

Read more in Daily Maverick: Israel-Palestine War

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