We speak with a number of leading Africa-focused fixed income fund managers to get a better sense of the opportunities and risks present in the continent’s emerging and frontier economies.
The domestic cotton and textiles sectors used to be a huge contributor to Nigeria’s GDP, but massive growth in the oil sector coupled with declining government support has marginalised the industry. Sumit Jain, CFO of West African Cotton Company (WACOT), talks to Bonds & Loans about how the company is working with the government to boost domestic production of cotton and foodstuffs, and how stringent import restrictions and FX shortages – among the biggest challenges facing Nigerian corporates – have created new opportunities for mid-market players.
South African economy likely to return to growth – Nigerian government secures a loan from AfDB – Nigeria’s green bond suspended once again – Democratic Republic of Congo’s inflation to hit 44.64% – Kenya’s Treasury bonds outperforming the corporate debt – Rosneft seeks to open offices in Mozambique – Ghana sold a 5-year bond – Republic of Congo is heading for a default – Zimbabwe to double its bond issuance
Nigerian regulators have made progress on managing the country’s challenging FX situation and narrowing the gap between official and black-market currency exchange rates, giving a much-needed boost to investor confidence. Madhukar Khetan, COO, of Dufil Prima Foods, which is lining up its debut bond issuance after nearly a year of planning, says the government now needs to tackle the regulatory compliance process associated with issuing if it is to have any hope of jolting the country’s capital markets back to life.
EEHC, Egypt’s main electric power distributor, successfully completed one of the largest loan syndications in the region with the help of two major lenders, National Bank of Egypt and Banque Misr, which, in a pioneering twist, marketed the loan at discount rates on the secondary markets.
As the latest corruption scandal hits the already controversial administration of Jacob Zuma, investors are left wondering about the stability of Africa’s most industrialized economy.
Sub-Saharan African investment banking fees reached US$244.7mn during the half of 2017 – South Africa to issue a US$2bn Eurobond – South Africa’s central bank cuts rates – Nigeria’s inflation fell to a 13- month low – Kenya’s National Treasury extended the sale of securities through M-Akiba platform – Mozambique defaulted on Eurobond payment – Ghana will not extend IMF programme –Republic of Congo was downgraded – The Reserve Bank of Zimbabwe will secure loan
South Africa’s Myriad International Holdings tapped the international markets – Eskom signed loan agreement with China Development Bank – Private sector activity in South Africa fell in June – Nigeria sells T-Bills worth NGN31.9bn – Nigeria’s government intervenes to avert the collapse of Etisalat Nigeria – Kenya delays plans for maiden sukuk – Chad attempts to delay loan repayment – Gabon gets downgraded
The recent international issuances by both the sovereign and Nigerian lenders have been a hit with investors, this might as well inspire corporates to jump into the debt wagon soon enough. However, the West African nation still has a long way to go if it intendeds to take advantage of the markets positive sentiment towards Nigeria and bolster its local capital markets.
7 Jul 2017
- Africa Credit Markets Brief: June 16 – June 29
- Is Kenya’s Economic Model Sustainable?
- Africa Credit Markets Brief: June 2 – June 15
- Nigerian Naira Sees Windows of Opportunity
- Africa Credit Markets Brief: May 18 – June 1