Morocco and Mauritius join the Bloomberg Bond Index of the African Development Bank (AfDB/AFMISM). This marks a steady increase in the Bank's efforts to deepen the bond market in the continent's local currency, reads Tuesday, January 19, on the AfDB website.

 "This is a positive development as the inclusion of Mauritius and Morocco, two of Africa's top-rated issuers, will improve ABABI's overall credit quality, which now captures nearly 90% of the stock of African sovereign bonds in local currency," said Stefan Nalletamby, Director of the Bank's Financial Sector Development Department.

Stefan Nalletamby noted that in the current environment, ABABI indices are a reliable tool for international investors to measure and track African sovereign bond markets.  "This will be even more relevant after the COVID-19 crisis as sovereign debt managers, who will need to further diversify their local currency financing instruments, will also need to adjust their strategies, improve transparency and broaden their bond investor base, given the increasing financing needs of economies," the statement added.

The pan-African institution explained that it is working to deepen the continent's local currency bond markets. It will thus create an environment in which African countries can access long-term financing.

The bank stressed that it will work closely with the US financial group, Bloomberg, to provide investors with transparent and credible benchmarks  . This will allow, she stresses, to have a tool to better measure and monitor the performance of African bond markets.

The Bank also structured and invested in an exchange-traded fund, the African Domestic Bond Fund (ADBF), replicating the index. This offers investors an innovative tool to gain exposure to fixed income securities in local African currency. "ADBF is listed in US dollars on the Mauritius Stock Exchange and managed by Mauritius Commercial Bank Investment Management," the AfDB informed.

Launched in February 2015 by the AfDB, the ABABI (African Bond Index) now includes 10 African countries, namely Egypt, Kenya,  Nigeria, South Africa,  Botswana, Namibia,  Ghana, Zambia, Mauritius and Morocco.