Africa
South African politics to make downgrade inevitable
The present state of South African politics will contribute to the country losing its investment grade rating. Although the markets have already priced in a sovereign downgrade to sub-investment grade, recent political events surrounding the country’s Minister of Finance are still causing volatility in South African bonds and the rand.
14 Oct 2016
DFIs: Fearless lenders adopt new techniques to keep risk appetite alive
The development finance space in Africa has evolved quite a bit in recent years, prompting DFIs to change tack in order to address the evolving funding needs in the region’s economies. Will the challenges and pressures that come with being a modern DFI impede their fearless and risk-hungry nature? The development of many African markets may depend on whether they do.
13 Oct 2016
Impact of dollar shortage varies across Nigerian banks
Nigeria’s banking sector is facing significant pressures from a lack of dollar liquidity. Further devaluation in the naira would exacerbate NPL levels – which the country’s newest project, the Development Bank of Nigeria – would do little to alleviate. However, whilst some lenders are completely locked out of the international markets, others are in relatively good shape and are still able to…
12 Oct 2016
Sukuk popularity growing across Africa
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
Without concessions, Africa goes local for funding needs
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 Sept 2016
CASE STUDY: Ghana Shows Impeccable Timing with Eurobond
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 Sept 2016
South Africa is set for junk, but not all is lost
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 Sept 2016
African credit resilient in the face of upcoming central bank actions
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 Sept 2016
African PPP see disparities between SSA, East and West
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 Sept 2016
Alternatives available for South African SOCs following investor withdrawals
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 Sept 2016