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African international bond issues for 2024 exceed $10 billion, marking growing investor confidence

Monday, 08 April 2024 18:15
African international bond issues for 2024 exceed $10 billion, marking growing investor confidence

(Ecofin Agency) - African businesses and governments are increasingly turning to the international bond market to meet their foreign currency needs, amid signs of growing openness from international investors.

Despite the complexities many issuers from the region face, bond issues originating from Africa have exceeded $10 billion since the start of the year. Although this figure may seem modest compared to the global issuance of $1,217 billion during the same period, it represents a significant step forward for the African continent.

The $14.8 billion raised for just Q1 2024 accounts for 67.8% of the total recorded for 2023 as a whole, nearing half the volume of the entire year of 2022, which was set at $22.8 billion. Many analysts view this momentum as a renewal of international investor interest in Africa, despite concerns over over-indebtedness and default risks highlighted by rating agencies.

However, a closer look at the transactions reveals a more nuanced picture. The African Development Bank (AfDB), the only African entity with a triple-A rating, emerged as the leading issuer, accounting for seven of the seventeen issues during this period. Anglo-American, a major mining industry player based in South Africa, also made a significant contribution to this total with three issues. Overall, bond issues from African companies generated $5.2 billion.

For governments, Côte d'Ivoire, Benin, and Kenya stood out, collectively mobilizing $4.85 billion and attracting varying degrees of investor interest. Also, the Arab Bank for Economic Development in Africa (BADEA) marked its first step into this segment, contributing to the surge in sustainable international bonds from the region, which reached a new high of $4 billion.

The outlook appears promising with more issuances expected from Africa. Signs of stabilization in Senegal, as well as soothing statements from its leaders, are boosting investor confidence. Nigeria is also gearing up for an issue and has appointed banks to orchestrate the deal, which is due for completion in June 2024, underlining the continued appeal of Africa's international bond market.



Public Management

ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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