"Public debt issuing countries in sub-Saharan Africa are likely to have to wait for the next window, given the sharp drop in commodity prices that led to below-average performance in the last week," Bloomberg said to the financial information agency. chief economist at Gemcorp.
"There is every likelihood that road shows will be very difficult because of the coronavirus and the current preference for safer financial instruments," added Simon Quijano-Evans.
In February, the average interest rate demanded by investors had already risen 40 basis points (0.4 percent), but this month it rose another 100 points to reach the highest level in the last 12 months, calculated JPMorgan Chase, which compares with an increase of 0.6 percentage points to the average for emerging markets.
The rise in interest rates is directly linked to the 27 percent drop in the price of oil this month, a key raw material for financial balance in countries dependent on this product to raise international income and finance development, as is the case in Nigeria, Angola, which intend to issue public debt this year.
"Nowadays nobody is going to look at Eurobonds issued by sub-Saharan African countries," summarized the head of the investment department at Capitulum in Berlin.
"If regular issuers and regular names do not appear on the market, then debutants or those with exotic names from Africa will now have a very difficult time issuing debt," added Lutz Roehmeyer.
However, funding is not completely closed, with alternative sources available, stresses Simon Quijano-Evans: "The IMF has made $ 50 billion available to provide assistance to low-income countries and emerging markets facing disruption because of the outbreak, and this is a window that must be open, because if that demand exists, the IMF and the World Bank will act immediately to help the country that asks ", he considered.
