The world's leading cocoa producer has managed to issue 1 billion euros in bonds on favorable terms.

This is another sign of renewed optimism on the markets: Côte d'Ivoire managed to issue 1 billion euros in bonds on the international capital markets on Tuesday, a first for a sub-Saharan African country since the start of the coronavirus crisis and just over a week after Zambia's default. Ghana and Gabon were the last two to have had access to it at the beginning of the year.

The world's largest cocoa producer has benefited from strong demand from investors looking for returns but also from particularly favourable financial conditions on the markets with the influx of liquidity from central banks. Demand reached 3.1 billion euros, which allowed Côte d'Ivoire to raise its ambitions (it projected an issue of 825 million euros) and to obtain a low financing cost for an issuer in its category. The country is rated Ba3 by Moody's and B+

This 11.2-year issue (maturity 2032) was placed on the basis of a 5% return (lower than the original price of 5.5%), which is slightly lower than the price on the secondary market. The 2030 bond traded before the transaction on the basis of a yield of 4.7%, which is close to its lowest at the beginning of the year (4.4%). Last year, in October, the country issued a loan of the same maturity with a yield of 5.875%

Renewed interest

Investors

Debt securities have not only erased their fall as a result of Covid-19 but are now trading below their price of a year ago. All emerging debt has benefited from renewed investor appetite in recent months, allowing spreads to tighten. The main emerging countries were able to broadcast on the markets, but for Côte d'Ivoire, it was necessary to wait for the reelection of Alassane Ouattara as president, even if it is still contested by the opposition. The climate was particularly harmful during the campaign with numerous acts of violence. But investors seem to believe there will be a return to calm and are counting on continuing the market-friendly growth policy pursued during his first two terms of

Moody's economists expect growth to rebound to 7% in 2021, returning to the trend of recent years, after falling to 1.9% this year. The rating agency confirmed its rating in early August, considering that Côte d'Ivoire's request for a freeze on the service of its multilateral debt as part of the G20 debt service suspension initiative (ISSD) was included in the rating. Some were worried that countries requesting to benefit would then encounter difficulties in refinancing themselves on the markets, and the Côte d'Ivoire issue seemed to show that they were not. But the country is one of the most important countries affected by SDI and has a lower level of risk, even if it has already failed in the past

Because while Côte d'Ivoire has managed to issue Eurobonds, there is nothing to say that others will be able to do so. In any case, in such good conditions. However, the refinancing needs for countries eligible for SDI (for the most part, countries in sub-Saharan Africa) are estimated at 127 billion dollars for 2021 by the Institute of International Finance (IIF