EUROBOND: Nigeria, African economies may save $30 bln in interest payments if they borrow from AfDB

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African nations might have saved almost $30 billion in interest payments by borrowing from the African Development Bank instead of tapping eurobond markets, the lender’s president said.

Countries on the continent raised about $40 billion of funds selling eurobonds over the past decade, the bank’s president, Akinwumi Adesina, said.

Accelerating inflation and Russia’s war on Ukraine has seen borrowing costs for countries on the continent surge — the yield on the 10-year debt of Nigeria, Africa’s biggest economy, was 12.88% on Tuesday.

“If they’d actually borrowed that money from the AfDB, you know what would have happened? They would have saved themselves” almost $30 billion in interest payments, Adesina said in an interview in Marrakesh. The bank is now working on a plan to provide such countries with “low-interest, long term money that will allow them to be able to get more resources to cope with many of these challenges,” he said.

Emerging markets have been under pressure from rising debt and slowing economic growth, which have worsened since Russia’s invasion of Ukraine in February.

Sovereign debt of Ghana, Egypt and Kenya are among the most vulnerable, according to an analysis by Bloomberg Economics.