African Eurobond plans off the table after oil price plunge
Africa’s oil exporters are feeling the pressure after the crash in the oil price and fears of the coronavirus Covid-19, as investors pull money from international bond markets.
Nigeria’s plans to issue a $3.3 billion Eurobond to fund its budget and refinance loans this year will be delayed, after Eurobond yields across emerging markets shot up due to the oil price plunge and the increasing threat of the coronavirus across the globe.
Côte d’Ivoire, Benin and South Africa, which also had plans to issues Eurobonds this year, are similarly likely to postpone any debt issues until markets stabilize.
“When a crisis like this hits, investors will de-risk portfolios and it is much easier for them to pull out of more liquid assets such as Eurobonds,” says Samir Gadio, head, Africa strategy at Standard Chartered.