Tanzania, Kenya and Zambia to issue sovereign bonds
Tanzania is seeking new sovereign ratings in the run-up to an upcoming sovereign bond issuance."A new assessment of sovereign risks will be made during summer 2011 to allow for the launch of a $500 million (€350.6 million) bond issue at the end of the year," announced Benno Ndulu, Tanzania Central Bank Governor, quoted by Les Afriques newspaper. Kenya and Zambia also recently announced that they will go on the international market with a view to receive $500 million each. The strong interest from African states for bonds and the success they have on the international market is mainly due to the strengthening of the macroeconomic credibility of the continent. "The rise in the price of the raw materials, the strong Chinese demand and the improvement of the general political situation are making African bonds particularly attractive for investors looking to diversify their portfolio," explained Graham Stock, Director at investment bank JP Morgan, quoted by the news source. A recent study by Ernst & Young, called It's time for Africa and published by Afrique expansion newspaper, questioned a panel of investors on this topic. Although all admited that Africa is increasingly attractive, there are still many obstacles for investors on the continent. According to respondents, these include unstable political environment (41 per cent), local organisation (23 per cent), corruption (22 per cent), weak security (22 per cent) and bad infrastructure quality (17 per cent).