Sukuk are becoming increasingly prevalent across Africa following Senegal’s upsized issuance and planned notes from the Cote d’Ivoire and Togo. Further capital market reforms are needed, however, to assist in their development which will allow for African nations to tap the Middle Eastern Islamic investor base.
3 Oct 2016
Many countries rely on concessional lending from the IMF and the World Bank, and for nations that are deemed ‘middle income status’ Eurobonds are a dominant funding vehicle. So why are African nations increasingly shunning Eurobonds for the local markets?
27 Sep 2016
The Republic of Ghana took advantage of a narrow window of opportunity to successfully issue a US$750mn 5-year Eurobond in a bid to buy back the remaining portion of outstanding 2017 notes and fund government spending.
22 Sep 2016
A South African foreign currency credit rating downgrade is looking increasingly likely in December. Although a downgrade would be credit negative in the long-run, there may be a small ‘relief rally’ in the immediate aftermath of the shift to junk.
16 Sep 2016
Despite a number of significant central bank actions on the horizon African debt is only likely to be impacted by US Fed activity due to the prevalence of dollars as hard currency across the continent. African debt will see a repricing if the US Fed hikes rates, but analysts suggest many African sovereigns would be able to weather any hike given low debt levels or upcoming maturities.
15 Sep 2016
The infrastructure deficit in Africa requires significant investment to reverse. PPPs are an effective method to bring in additional private capital to projects, but their use is relatively thinly spread across the continent.
7 Sep 2016
Although Futuregrowth Asset Management and Jyske Bank’s announcements that they will not lend to South Africa SOCs has had some impact on the country’s markets, the main driver for their lacklustre performance has been concerns over government infighting and the Ministry of Finance’s independence. The news could, however, prompt other SOCs to improve on governance and transparency.
7 Sep 2016
The fact that Nigeria has officially entered a recession is not likely to dampen investor sentiment around the country despite its current economic situation. Sentiment will, however, be affected by the ability of the government to implement a new FX policy. Until this occurs, many fixed income investors will wait on the side lines.
5 Sep 2016
Nigeria’s Securities and Exchange Commission has announced the date for the country’s debut sukuk. Although complications in establishing a supportive legal framework have delayed its issuance, other factors such as establishing the proposed sukuk’s client base have to be addressed.
16 Aug 2016
The financing of various projects through PPPs across Africa is not new, however this method of financing is more established in certain areas of the continent than others. Although there are opportunities for smaller lenders to participate in PPPs across various sectors, larger operations tend to be funded by China.
1 Aug 2016