Despite a projected debt level of 62% of its Gross Domestic Product in 2017, Gabon has succeeded in seducing the international capital market with an issue of international bonds worth $ 200 million.
The operation set and seen through by Deutsche Bank received an interest rate of 7% at the opening of tenders, before the latter fell back to 6.85%.
Subscriptions reached an overall amount of 600 million, although the Gabonese Republic kept to its initial needs.
This performance of the Gabonese sovereign loan is however, surprising. Beyond its debt level, investors targeting Africa were closely following Kenya’s presidential high-risk election and President Zuma’s vote of confidence in South Africa.
Gabon appears to have benefited from several positive elements.
The agreement established with the IMF gave it room for managing its external balance. In addition to this, investors continue to show interest in sovereign bonds with rates of return in excess of 5%.