The African Development Bank (ADB) has announced the addition of two new countries, Mauritius and Morocco, to its Bloomberg African Bond Indices (ABABI), marking steady progress in the bank’s efforts to deepen the continent’s local currency bond market.
ADB administers the ABABI, a family of African bond indices launched in February 2015 and calculated by the independent, global index provider Bloomberg.
The bank’s Director of the Bank’s Financial Sector Development Department, Stefan Nalletamby, explained that the two countries membership was validated on January 1st, 2021,
Nalletamby said: “This is a positive development as the inclusion of Mauritius and Morocco, two of Africa’s better-rated issuers, will improve the overall credit quality of the ABABI, which now captures close to 90 percent of the outstanding amount of African sovereign local currency bonds”.
Nalletamby noted that in the current environment, the ABABI indices are a reliable tool for international investors to measure and track African sovereign bond markets.
“This will be even more relevant following the COVID-19 crisis as sovereign debt managers, who will need to further diversify their local currency funding instruments, will also need to adjust their strategies, enhance transparency and widen their fixed income investor base, given the increased financing needs of the economies,” he added.
At the launch, the indices included Egypt, Kenya, Nigeria, and South Africa. Botswana and Namibia joined in October 2015, and Ghana and Zambia in April 2017.