Nigeria Faces $6.4 bn Eurobond Debt Repayment– World Bank

Nigeria Faces $6.4 bn Eurobond Debt Repayment– World Bank

Nigeria deals with a$6.4 bn sovereign Eurobond payment concern in between 2024 and 2030, ranking joint 3rd amongst the biggest payment direct exposures in sub-Saharan Africa, according to the World Bank.

The World Bank revealed this in its October 2026 Africa Economic Update, entitled Building AI Readiness, which analyzed increasing debt-servicing and refinancing pressures throughout the continent.

The report stated, “South Africa deals with the biggest payment problem, with US$ 11.8 billion, with maturities in every year of the duration. It is followed by Ghana ($6.4 bn), Nigeria ($6.4 bn), and Angola ($3.9 bn).”

This puts Nigeria and Ghana collectively behind South Africa in the ranking of nations with the biggest Eurobond principal falling due throughout the seven-year duration.

In general, the World Bank approximated that sovereign Eurobond principal developing throughout 13 sub-Saharan African nations in between 2024 and 2030 stood at about $43.6 bn, after changing for bond buybacks and liability-management operations finished through August 2026.

Nigeria’s $6.4 bn direct exposure represents about 14.7 percent of the area’s overall maturity problem. Together, South Africa, Ghana and Nigeria represent $24.6 bn, or about 56 percent of the $43.6 bn maturity wall.

Other nations with considerable responsibilities consist of Angola at $3.9 bn, Kenya at $3.2 bn, Côte d’Ivoire at $2.8 bn and Zambia at $2.2 bn.

The payment problem comes amidst substantially greater loaning expenses for Nigeria and other African sovereigns going back to global capital markets following the worldwide financial tightening up cycle that started in 2022.

The World Bank stated sovereign Eurobond issuance in sub-Saharan Africa amounted to about $122bn throughout 158 deals in between 2015 and August 2026.

6 nations represented more than 80 percent of those issuances, with Nigeria becoming the area’s second-largest company.

South Africa provided $23.7 bn through 15 deals throughout the duration, while Nigeria raised $20bn throughout 18 deals. Angola followed with $15.8 bn, Côte d’Ivoire with $15bn, Ghana with $12.6 bn and Kenya with $12.2 bn.

Worldwide capital markets ended up being mostly unattainable to African federal governments after worldwide rate of interest increased in 2022. Nigeria, Angola and South Africa were the only sub-Saharan African sovereigns able to release Eurobonds that year, according to the report.

Market gain access to started recuperating in 2024, when Nigeria raised $2.2 bn along with issuances of $3.5 bn by South Africa, $2.6 bn by Côte d’Ivoire and $1.5 bn by Kenya.

The return to the market came at a significantly greater rate. The report kept in mind that Nigeria’s 2024 Eurobond issuances brought discount coupons of 9.6 percent and 10.4 percent, about 300 basis points greater than similar issuances in 2021.

Throughout the area, yields on bonds provided throughout the 2024 market resuming varied in between 7.1 percent and 10.4 percent, about 300 to 500 basis points above equivalent levels before 2022.

The World Bank cautioned that the greater loaning expenses might intensify financial pressures even where nations effectively re-finance growing commitments.

“Although re-financing operations assist reduce near-term rollover pressures, they likewise secure greater financial obligation service expenses for many years to come, increasing financial problems and minimizing policy area even as instant refinancing dangers diminish,” the report stated.

The bank stated refinancing, instead of straight-out payment from federal government profits, had actually ended up being the primary technique embraced by the majority of African sovereigns challenging growing Eurobonds.

Kenya re-financed many of a $2bn Eurobond that grew in 2024 by releasing $1.5 bn in brand-new financial obligation, supplemented with budget plan resources. The brand-new loaning came at a yield of 10.4 percent compared to the 6.9 percent voucher on the initial financial obligation.

Ghana, on the other hand, handled its responsibilities through a financial obligation exchange finished in October 2024, while Ethiopia reorganized its $1bn launching Eurobond after going into default in late 2023.

The maturity pressure is anticipated to stay considerable throughout the area. Following liability-management operations that minimized responsibilities falling due in 2028 to about $5.5 bn, the biggest upcoming concentrations are $6.6 bn in 2027 and $7.5 bn in 2029.

The World Bank raised a more issue over the structure of current loaning, keeping in mind that lots of Eurobonds released throughout the 2024-2026 resuming have maturities of just 5 to 6 years, compared to the 10- to 12-year tenors typical before the COVID-19 pandemic.

It alerted that the mix of much shorter maturities and greater rates of interest indicated refinancing pressures might return faster.

“For a number of Sub-Saharan African sovereigns, Eurobond funding significantly looks like a refinancing cycle in which succeeding rollovers resolve near-term maturities however slowly deteriorate financial area through greater financial obligation service expenses,” the Bank mentioned.

Beyond Eurobonds, the report stated public and openly ensured external financial obligation service throughout sub-Saharan Africa had actually stayed raised at about 1.6 to 1.7 percent of gdp given that 2021.

It cautioned that increasing interest and primary payments were consuming federal government profits that might otherwise fund facilities, human capital and social defense.