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African Eurobonds shine as high yields lure investors

African Eurobonds

African Eurobonds have outperformed their peers in the emerging market this year, with Kenya and Zambia topping the list of best-performing emerging market sovereigns in the Eurobond market, data from Bloomberg showed.

Of the 12 sovereigns that has performed well in the Eurobond market this year, eight are African nations.

East Africa’s biggest economy Kenya, returned 9.9 percent on the average for Eurobonds, followed by Zambia with 9.8 percent average returns.

Nigeria, which powers the largest economy in the continent, took the fourth spot and returned 9.2 percent in the Eurobond market while average total returns for Oil-rich nations – Angola and Gabon stood at 8.9 percent and 7.1 percent respectively.

This points that Africa is now a safe investment destination for emerging-market bond investors.

Africa’s dollar securities outperform other regions in the emerging market as the dovish stance of the US Federal Reserve lures investors to purchase riskier, high-yielding assets.

The continent’s Eurobonds have returned 6.4 percent in 2019, outpacing the average gain for emerging market which is 4.4 percent.

Other non-African nations that appeared on the top performing emerging market sovereigns in Eurobond are Argentina, Ecuador, Papua New Guinea and Jordan.

Latin-America countries – Argentina and Ecuador returned 9.5 percent and 8.3 percent respectively so far in 2019, while average total returns of Papua New Guinea and Jordan’s Eurobond settled at 7.6 percent and 7.0 percent respectively.



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