Back to the complete issue
Tuesday, 24 December 2019

Egypt listed among top African bond markets for next year

Egypt set to be among top African bond markets in 2020: Global investors have “reaped rich rewards” from African countries’ debt markets, which have outperformed all other EM regions in 2019, Bloomberg’s Paul Wallace says. The strong performance should be sustained in 2020 “if the world’s major central banks remain dovish,” pushing investors seeking higher yields to African markets including Egypt, Angola, Ghana, Ethiopia, and Nigeria. “Egypt remains a favorite among portfolio investors. Carry traders, attracted by yields of around 14% on [EGP] bonds, have flocked to the Arab nation. The currency has rallied 12% this year, its best performance in at least 25 years,” Bloomberg says.

Where will the EGP settle in 2020? Bloomberg notes that Societe Generale expects the EGP strengthen 4.5% next year to hit EGP 15.35 against the greenback.

The EGP has offered the second-best carry trade in the world over the past five years, outperformed only by the RUB, the business information service notes. At 72.9%, the Russian currency has delivered more than double the 30.0% carry trade return the EGP has been able to offer investors, making it a safe haven currency amid trade war concerns. The RUB’s stellar performance comes five years after the Russian central bank let the currency float, which initially triggered a “nosedive” in 2014.

Enterprise is a daily publication of Enterprise Ventures LLC, an Egyptian limited liability company (commercial register 83594), and a subsidiary of Inktank Communications. Summaries are intended for guidance only and are provided on an as-is basis; kindly refer to the source article in its original language prior to undertaking any action. Neither Enterprise Ventures nor its staff assume any responsibility or liability for the accuracy of the information contained in this publication, whether in the form of summaries or analysis. © 2022 Enterprise Ventures LLC.

Enterprise is available without charge thanks to the generous support of HSBC Egypt (tax ID: 204-901-715), the leading corporate and retail lender in Egypt; EFG Hermes (tax ID: 200-178-385), the leading financial services corporation in frontier emerging markets; SODIC (tax ID: 212-168-002), a leading Egyptian real estate developer; SomaBay (tax ID: 204-903-300), our Red Sea holiday partner; Infinity (tax ID: 474-939-359), the ultimate way to power cities, industries, and homes directly from nature right here in Egypt; CIRA (tax ID: 200-069-608), the leading providers of K-12 and higher level education in Egypt; Orascom Construction (tax ID: 229-988-806), the leading construction and engineering company building infrastructure in Egypt and abroad; Moharram & Partners (tax ID: 616-112-459), the leading public policy and government affairs partner; Palm Hills Developments (tax ID: 432-737-014), a leading developer of commercial and residential properties; Mashreq (tax ID: 204-898-862), the MENA region’s leading homegrown personal and digital bank; Etisalat Misr (tax ID: 235-071-579), the leading telecoms provider in Egypt; and Industrial Development Group (IDG) (tax ID:266-965-253), the leading builder of industrial parks in Egypt.