COVID-19 & Performance of African Local Currency Bonds vs Other Asset Classes

This document is based on a webinar hosted by the MFW4A Secretariat in partnership with the African Financial Markets Initiative (AFMI) on the performance of the African local currency fixed income asset class. The African Local Currency Bond Fund (ALCB Fund), launched by the African Development Bank (AfDB), is a multi-stakeholder initiative which aims to promote local capital market development, access to long-term local currency financing, and to crowd-in domestic institutional investors. During the one-hour webinar, panellists discussed and contrasted African local currency bonds performance and other asset classes. They also assessed the state of some of the major African economies in the context of the COVID-19 pandemic, and how governments and financial markets are dealing with the situation. In particular, the discussion focused on the pan-African local currency fixed income asset class covering performance, volatility, liquidity on an absolute basis and relative to global peers.