Angola to test African Eurobond appetite

Angola to test African Eurobond appetite

Angola could become the first African sovereign bond borrower since the great oil price crash this year in a debut deal that will set the tone for frontier-market debt.

Analysts suggest Angola's net debt position is sustainable, though credit-rating agencies highlight risks due to the 40% fall in oil prices since early 2014. Standard & Poor's downgraded the sovereign on Friday from BB-/B to B+/B. Fitch and Moody's rate Angola at BB- and Ba2 respectively. 

Tiago Dionisio, Assistant Director at Asset Management and Brokerage firm Eaglestone, says: "Debt sustainability isn't an issue at the moment. Total debt is worth $48.3 billion and the debt-to-GDP ratio is 35.5% - the international component of which is 24.5%. "This may appear big compared to African standards, but given the size of the economy this is actually quite low." He adds: "Angola also has ample foreign exchange reserves at $27 billion, according to the central bank, worth around seven to eight months import cover."

http://www.euromoney.com/Article/3427897/Angola-to-test-African-Eurobond-appetite.html?single=true