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(Ecofin Agency) – Niger, facing arrears due to ECOWAS sanctions, has stepped back into the regional financial market after a hiatus since August 2023. On April 26, the Sahelian nation mobilized a total of CFA457 billion ($747.03 million).
Despite achieving a 109% coverage rate, slightly below market norms, this move signals Niger’s return. Subscriptions for the 364-day bonds reached CFA304.6 billion, significantly surpassing longer-term obligations, with 3-year bonds totaling CFA122.3 billion and 5-year bonds reaching CFA31 billion.
Market trends show investor caution, favoring short-term investments, impacting yields from issuance. Weighted average yields for the 364-day bonds hit 9.30%, 9.35% for 3-year bonds, and 8.68% for 5-year bonds, reflecting liquidity compensation and heightened short-term risk perception. Niger’s yields remain notably higher than those in neighboring countries, like Togo and Côte d’Ivoire.
For instance, Togo’s 12-month and 3-year bond yields are 7.65% and 7.91%, respectively, while Côte d’Ivoire recorded 7.54% for 3-year bonds during a similar issuance. Even with Guinea’s financial difficulties, weighted average yields for 12-month bonds stay below 9%.
Niger plans to use the funds to settle overdue interest and capital, with half the overdue interest due on April 26, and the remainder within 30 days after capital restructuring.
This move follows Niger’s recent memorandum of understanding with the China National Petroleum Corporation (CNPC) for the marketing of crude oil, securing an advance of $400 million from CNPC to be repaid with 7% interest within twelve months.
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