Putting Findings of Research into all African Perspective

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Presentation transcript:

Putting Findings of Research into all African Perspective Improving DRM and Stemming IFFS Tax Justice for Promoting Equality and Social Justice Nairobi, Kenya 13 March 2019 Fanwell Kenala Bokosi, PhD Executive Director

$92 billion of outstanding African sovereign Eurobonds External Debt Stock/GNI 33.5% External Debt Stock/Exports 135.7% Concessional/External Debt Stock 32.4% 2017 $92 billion of outstanding African sovereign Eurobonds

2017 External Debt Stock/GNI 35.7% External Debt Stock/Exports 243.8% Tunisia Morocco External Debt Stock/GNI 35.7% External Debt Stock/Exports 243.8% Concessional/External Debt Stock 56.2 % Algeria Libya Western Sahara (Morocco) Egypt Mauritania Niger Senegal Eritrea Sudan Djibouti The Gambia Mali Chad Burkina Faso Guinea-Bissau Guinea Benin Côte d'Ivoire Nigeria Togo Ethiopia Sierra Leone Liberia Ghana Central African Republic South Sudan Cameroon B=Burundi Somalia EG EG=Equatorial Guinea Uganda São Tomé and Príncipe Kenya Gabon Congo Republic L=Lesotho DR Congo R R=Rwanda B S=Swaziland Tanzania External Debt Stock/GNI 65.2% External Debt Stock/Exports 179.4% Concessional/External Debt Stock 24.2 % Seychelles Comoros Mayotte (France) Angola Zambia Malawi Mozambique Zimbabwe Namibia Madagascar Botswana S L South Africa

$4.00bn $3.00bn Tenor (yrs.) $ (bn) Maturity Coupon 5 0.50 24-Jun-19 5.90% 10 1.50 24-Jun-24 6.90% 1.00 28-Feb-28 7.30% 30 28-Feb-48 8.30% Tunisia Morocco Algeria Libya Western Sahara (Morocco) Egypt $4.00bn Mauritania Niger Senegal Eritrea Sudan Djibouti The Gambia Mali Chad Burkina Faso Guinea-Bissau Guinea Benin Côte d'Ivoire Nigeria Togo Ethiopia Sierra Leone Liberia Ghana Central African Republic South Sudan Cameroon B=Burundi Somalia EG=Equatorial Guinea EG Uganda São Tomé and Príncipe Kenya Gabon L=Lesotho Congo Republic Tenor (yrs.) $ (bn) Maturity Coupon 10 0.75 20-Sep-22 5.40% 1.00 14-Apr-24 8.50% 12 1.25 30-Jul-27 9.00% DR Congo R B R=Rwanda Tanzania S=Swaziland Seychelles Comoros Mayotte (France) Angola Zambia Malawi $3.00bn Mozambique Zimbabwe Namibia Madagascar Botswana S L South Africa

2018 Tough Year? Sign of the Future? Concerns about global growth and that of China A stronger US dollar The average yield of African eurobonds increased from 5.3% to 7.4% 2018 Tough Year? Sign of the Future? Trade Tensions African yields are 2.9 percentage points higher than the Rest of the world AFRICAN PREMIUM The Fed raising US rates

IMPLICATIONS OF THE INCREASE IN YIELDS $ 1 Billion 10 Year Eurobond 5.3 % 7.4 % $210 mn $74 million a year $53 mn per year $530 mn interest in 10 yrs $740 mn interest in 10 years

Susceptibility to External Shocks Exchange Rate Risk Credit Risk 7.4 % + 14.0% Debt Distress Borrowing to repay past Borrowing Corruption 21.4 % Interest Rate Risk Susceptibility to External Shocks 96 % of bonds are on Fixed Rates

THANK YOU