Explore the structural forces shaping African sovereign debt markets and how they differ from their LatAm and APAC peers.
[TRANSCRIPT]
Tracking the African Sovereign Debt Market with the iBoxx LSF USD African Sovereigns Index
Frontier markets are gaining momentum, and Africa is increasingly central to the story. As interest in emerging markets broadens, what’s the potential role of frontier markets in the global fixed income opportunity set? Developed by S&P Dow Jones Indices (S&P DJI) in collaboration with the Liquidity & Sustainability Facility (LSF), the iBoxx LSF USD African Sovereigns Index provides a focused lens on the evolving profile of African sovereign debt.
The iBoxx index tracks the performance of USD-denominated bonds issued by African sovereign entities, specifically those located in countries that qualify for the LSF repo facility. The index is designed support the LSF’s goal of enhancing the liquidity and sustainability of African sovereign eurobonds by utilizing S&P DJI’s fixed income experience and 25 years of the iBoxx family of indices.
For market participants, the index provides more than a transparent regional benchmark. It can be used to better understand what may be driven by sovereign credit ratings versus what may be driven by liquidity, market access and each country’s stage of market development.
As of Aug. 31, 2026, the index included 15 USD-denominated African sovereign constituents and displayed differentiated fixed income characteristics. The index’s spread stood at 294 basis points, compared with 194 basis points for the iBoxx Emerging Markets Broad Latin America and 97 basis points for the iBoxx USD Asia-Pacific Emerging Markets. At the same time, the index had a modified duration of 5.41 years, versus 6.09 years for the iBoxx Emerging Markets Broad Latin America and 3.93 years for the iBoxx USD Asia-Pacific Emerging Markets. This combination of wider spreads and shorter duration relative to some of its peers demonstrates the potential for credit risk with comparatively lower sensitivity to interest rate risk.
For those seeking to better understand frontier market debt, the index provides a practical framework for evaluating African sovereign bonds through both a risk and market development lens. African sovereign debt markets are evolving. Through S&P DJI’s collaboration with LSF, we are expanding the iBoxx toolkit to support the next stage of growth in this increasingly important segment of the global bond market.
Learn more about the iBoxx LSF USD African Sovereigns Index at spglobal.com/spdji.
