Egypt’s finance minister has announced the country is considering lauching a $3bn eurobond and is set to implement the country’s long-awaited value-added tax (VAT) by September.

Finance minister Amr el-Garhy was quoted by UK news agency Reuters as saying: “We are studying a bond issuance of $3bn on the international market between September and October of this year in order to fill part of the budget’s financing gap, which is expected to reach $10bn.”

Egypt has said the delay in its bond activity was due to turbulent financial markets and the slowdown in China, which has reduced liquidity for emerging markets.

Garhy also said he expects VAT, which has been delayed on fears of inflation and rising living costs, will be applied in September.

“Once applied it is expected to bring in revenues during 2016-17 ranging from [$2.25bn-$2.82bn].”

The cost of living in Egypt has continued to increase over the past 12 months and the raising of interest rates by the Central Bank of Egypt (CBE) in an effort to counter the currency devaluation has done little to alleviate rising costs.

Despite this, the country is likely to continue with a policy of monetary tightening as it tries to manage the shortage of foreign currency amid declining tourism revenues..

The cost of living is a sensitive topic for the government due to the social and political implications that follow the civil unrest it often causes among the poorest groups of society.