Morocco and Mauritius on January 1, 2021, joined the African Development Bank’s Bloomberg African Bond Index (ABABI).
The addition of the two countries marks the steady progress in the Bank’s efforts to deepen the continent’s local currency bond market.
Launched in February 2015, the Bloomberg African Bond Index (ABABI) serves as a reliable index for international investors to better measure and track the performance of African sovereign bond markets.
The African Development Bank through ABABI aims at deepening the continent’s local currency bond markets and create an environment where African countries can access long-term financing.
Announcing the inclusion of Morocco and Mauritius, Director of the Bank’s Financial Sector Development Department, Stefan Nalletamby, said the addition of the two countries that are among Africa’s better-rated bond issuers, will improve the overall credit quality of ABABI.
“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% of the outstanding amount of African sovereign local currency bonds,” said Stefan Nalletamby.
“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,” added Stefan.
AfDB aside ABABI has also structured and invested in an exchange traded fund, the African Domestic Bond Fund (ADBF), replicating the index and providing investors with an innovative tool to gain exposure to African local currency fixed income.
The ADBF is listed in US dollars on the Stock Exchange of Mauritius and managed by Mauritius Commercial Bank Investment Management.
ABABI at its initial launch in 2015 included; Egypt, Kenya, Nigeria, and South Africa. Botswana and Namibia joined in October 2015.
Ghana together with Zambia joined in April 2017.
