…Nigeria, SA, Four Others Account for 80% Sub-Saharan African Eurobond Debts
…Nigeria’s Benchmark Lending Rate Second Highest In SSA
While most countries in Sub-Saharan Africa have taken actions to shield their populations from the shock of rising energy prices occasioned by the conflicts in the Middle East, Nigeria has left its citizens to market forces, the World Bank has said.
The bank said this in its Africa Economic Update October 2026 which was released in Washington on Tuesday.
While listing what other countries in Sub-Saharan Africa had done to shield their citizens from the effects of rising global energy prices, the Brentwood institution said Nigeria could still cater for the vulnerable in the society without necessarily restoring the controversial fuel subsidy.
The bank said, “In response to the energy shock, African countries have adopted a range of measures to protect vulnerable households, with policy responses shaped by differences in exposure to the shock and available fiscal space.
“In contrast to other regions, the limited fiscal buffers of many Sub-Saharan African economies have constrained the use of broad-based fuel subsidies, tax reductions, and other costly fiscal interventions.
“Where fiscal measures have been deployed, they have generally been temporary and targeted, reflecting concerns about debt sustainability and competing development priorities.
“As a result, governments have relied more heavily on monetary, financial, and administrative measures to contain the economic fallout from higher energy prices.
“Policy responses have varied across countries: some central banks tightened monetary policy to contain renewed inflationary pressures, while others eased rates to support growth and employment, underscoring difficult policy trade-offs.
“Meanwhile, a few countries, notably Nigeria, have largely maintained market-based fuel pricing, limiting the fiscal and monetary costs of shielding domestic consumers from higher global energy prices.
“While preserving these pricing reforms remains important, targeted support for vulnerable households may be warranted to mitigate adverse welfare effects without reinstating broad-based subsidies.
“The policy instruments implemented serve distinct objectives, ranging from cushioning vulnerable households from higher energy costs and encouraging energy conservation to supporting the transition toward more efficient and sustainable energy use.”
It added, “Across the region, governments have adopted varying approaches. Some have allowed higher international energy costs to pass through to domestic consumers, while complementing price adjustments with non-fiscal measures such as energy conservation campaigns, load management programs, and restrictions on nonessential energy use. Others have moderated domestic price increases through tax reductions, subsidies, or direct price controls.”
Nigeria’s petrol prices started climbing up on May 29, 2023 at the inauguration of Bola Tinubu when the new president declared that ‘subsidy is gone’.
The declaration triggered more than 150 per cent increase in price as the pump price of petrol jumped from N180 to about N500 per litre.
Subsequently, the price of the commodity rose to between N800 and N1,000 per litre before moderating to about N950.
However, with the conflict between the United States of America and Iran, the pump price of petrol has hovered between N1,350 and N1,500 per litre.
The rising cost of fuel and the floating of the exchange rate have combined to make life unbearable for majority of citizens as inflation also rose in similar proportions.
The World Bank said divergent policy responses had widened cross country differences in retail fuel prices, increasing incentives for cross-border arbitrage and related market distortions.
Although the region has made notable progress in advancing the energy transition in recent years, adoption of structural reforms aimed at strengthening energy efficiency, diversification, and long-term resilience remains limited, the bank said.
Yet, it added, such reforms were critical for reducing vulnerability to future commodity price shocks and enhancing energy security.
It said, “Mauritius, one of the countries most exposed to the recent energy shock, offers a notable example: its response emphasized energy conservation and transition measures rather than broad-based fuel subsidies, illustrating how crises can be leveraged to accelerate resilience-enhancing reforms.
“Overall, the diversity of policy responses highlights the difficult balancing act facing policy makers: mitigating the immediate impact of higher energy prices on households and firms, preserving fiscal and macroeconomic stability, and advancing longer-term energy resilience and sustainability.”
The bank said the impact of the ongoing Middle East conflict on inflation had been heterogeneous across countries in the region, with the consumer price response shaped by countries’ net commodity balances, fiscal space, and exchange rate dynamics.
It said, “Net fuel and food importers have been the most exposed, particularly those relying on trade routes affected by disruptions in the Middle East region.
“In contrast, the gains from commodity revenues in oil exporters — such as Angola and Nigeria — are expected to be partly offset by rising inflationary pressures and their adverse effects on household welfare. Looking ahead, inflation risks remain tilted to the upside.
“A renewed escalation of geopolitical tensions in the Middle East could raise energy and food prices and heighten exchange rate risks, with the largest effects likely in countries characterized by weak currencies, limited reserve buffers, and high import dependence.”
On debts, the World Bank stated that Nigeria and five other countries account for 80 per cent of Sub-Saharan African Eurobond debts.
It said, “Six countries account for more than 80 per cent of Sub-Saharan African sovereign Eurobond issuance between 2015 and 2026: South Africa ($23.7bn across 15 transactions), Nigeria ($20bn, 18 transactions), Angola ($15.8bn, 15 transactions), Côte d’Ivoire ($15bn, 15 transactions), Ghana ($12.6bn, 14 transactions), and Kenya ($12.2bn, 12 transactions).
“Recent issuances, including the Democratic Republic of Congo’s inaugural Eurobonds in 2026, illustrate both the broadening of access to the market and its high cost, with borrowing concentrated in an environment of elevated interest rates and tighter financial conditions.
“Total Sub-Saharan African sovereign Eurobond principal maturing between 2024 and 2030 amounts to approximately $43.6bn across 13 countries, after adjusting for buybacks and liability management operations completed through August 2026.
“However, redemption pressures remain concentrated among a small group of issuers. South Africa faces the largest repayment burden, with US$11.8bn, with maturities in every year of the period.
It is followed by Ghana ($6.4bn), Nigeria ($6.4bn), and Angola ($3.9bn), whose maturity profiles reflect a combination of pre-restructuring borrowing and post-restructuring exchange instruments.
“Kenya ($3.2bn), Côte d’Ivoire ($2.8bn), and Zambia ($2.2bn) complete the next tier of maturities. Redemption pressures were particularly acute in 2024, when Côte d’Ivoire, Ethiopia, Kenya, Senegal, and Zambia collectively faced approximately $6.4bn in maturing obligations, making it the most concentrated repayment year in the current cycle.”
The World Bank noted that the Central Bank of Nigeria reduced its Monetary Policy Rate from 26.5 per cent to 23 per cent.
However, a listing of different countries MPR showed that Nigeria comes only behind Malawi which has discount rate of 24 per cent.
Other countries with high MPR include Ethiopia (16), Angola (14.75), Ghana (14), The Gambia (14), Zambia (13.25), and Madagascar (12.5). Countries with lower MPR include Botswana (5.5), Mauritania (6), WAEMU zone (5) and CEMAC zone (4.5).
The MPR is the rate at which the central bank lends to banks. It sets the benchmark for banks’ lending rates in any country.
SOURCE: The Whistler
