By Andrei Skvarsky.
The African Development Bank (AfDB) has raised $3bn via a three-year bond to help to alleviate impacts that the Covid-19 pandemic is expected to have on livelihoods and economies in Africa.
Bids exceeding $4.6bn have come in for the Fight Covid-19 bond, which has a yield of 0.75 per cent and has been on sale worldwide, the AfDB said on March 27.
Fight Covid-19 is “the largest social bond ever launched in international capital markets to date” and represents “the largest US Dollar benchmark ever issued by the Bank”, the lender, which is based in Abidjan, Ivory Coast, said in a statement.
The AfDB’s shareholders are 54 African and 26 non-African countries.
There still is a comparatively low incidence of coronavirus in Africa, but the disease proliferated to more than 4,300 confirmed cases as of March 29 from 450 as of March 17.
Of the Fight Covid-19 bonds that have been sold, 37 per cent were acquired in Europe, 36 per cent in the Americas, 17 per cent in Asia, 8 per cent in Africa, and 1 per cent in the Middle East.
Central banks and other state institutions bought 53 per cent, commercial banks 27 per cent and asset managers 20 per cent of the securities.
The AfDB has raised an equivalent of a total of $2bn through euro- and Norwegian krone-denominated bonds issued as part of a social bond programme it has been running since 2017.
The bank cited an estimate that Africa would need “many billions of dollars to cushion the impact of the disease”.
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