Ninety One has identified Africa’s emerging bond markets as a compelling avenue for yield-seeking investors, citing spreads 400–600 basis points above developed market equivalents and strong local currency stability in key nations. The firm is building dedicated strategies to capture returns from sovereign and corporate debt across sub-Saharan Africa.
- Sovereign bond spreads in Africa range from 450 to 600 basis points above U.S. Treasuries
- 10-year Kenyan government bond yields at 12.5%, down from 17% in 2023
- Nigeria’s benchmark bond yield declined from 28% to 21% over 2023–2025
- Over $1.2 billion in corporate bonds issued in Nigeria and South Africa in 2025
- Ninety One’s Africa-focused bond portfolio yields 13.7% on average
- Projected external investment in African bonds could exceed $15 billion by 2027
Ninety One is actively positioning itself in Africa’s fixed income markets, viewing the region as a fertile ground for investors seeking higher returns amid a global shift toward monetary easing. The firm highlights that sovereign bond spreads in countries like Kenya, Nigeria, and Ghana currently trade at 450 to 600 basis points above comparable U.S. Treasuries, a significant premium that reflects both risk and potential reward. These spreads have narrowed modestly since 2023 but remain elevated compared to historical averages, signaling underlying confidence in credit fundamentals despite macroeconomic volatility. The firm’s analysis points to improving fiscal discipline and central bank resilience in several African nations. For instance, Kenya’s 10-year government bond yields have stabilized around 12.5% after a peak of 17% in early 2023, while Nigeria’s benchmark bond yield has declined from 28% to approximately 21% over the same period. Corporate bond issuance in South Africa and Nigeria has also increased, with over $1.2 billion in new corporate debt raised in 2025 alone, indicating growing market depth and investor appetite. Ninety One’s Africa-focused strategies now hold positions in over 30 sovereign and corporate bonds across 12 countries, with a weighted average yield of 13.7%. The firm notes that local currency depreciation risks have diminished, as central banks in major economies like South Africa and Egypt have maintained tighter policy stances to preserve exchange rate stability. This environment, combined with rising foreign direct investment inflows and growing infrastructure financing needs, is creating a structural tailwind for bond demand. The move is expected to attract institutional capital from Europe and North America, where fixed income yields remain constrained. Pension funds, sovereign wealth funds, and private asset managers are increasingly allocating to African credit as part of diversified, long-duration portfolios. The firm anticipates that with continued macroeconomic reforms and improved governance, Africa’s bond market could absorb more than $15 billion in external investment by 2027.