THE AFRICAN FUNDAMENTAL BOND INDEX

The 2014 Annual Country Rankings and Scores Report

December 2014

Your gateway to Africas bond markets

 Contents

Background and Rationale 3

Section1: 2014 AFBI country rankings and scores 5

1.1 2014 country rankings 5
1.2 Analysis of the Top Ten Countries 6
1.3 Graphical representation of scores by Factor 8

Section 2: Methodology 11
2.1. Macro-Economic Score 11
2.2. Governance 11
2.3. Bond Market Infrastructure score: 11
2.4. Issuers, Issuing Strategy and Market Access score: 12
2.5. Domestic Investor Base score: 12
2.6. Active participation of Economic Agents: 12

Sources of Data and Information 14

3

T
he African Development Bank (AfDB) is a regional
multilateral development institution which was
established in 1963 by international treaty and whose
mission is to promote sustainable economic growth and reduce
poverty in Africa. In fulfilling its mandate for poverty reduction
and development through growth and economic integration, it
is also committed to the development of the financial sector in
Africa. Further to this, capital markets development has been
recognized as an integral component in achieving the AfDBs
Ten Year Strategy (TYS); to this end, the African Financial
Markets Initiative (AFMI) is specifically mentioned as one of the
mechanisms to aid capacity development in African financial
markets with a view to supporting operational priorities of the
TYS in infrastructure and private sector development.
Diversifying the financial sector to include an active local
currency bond market can play an important role in: (i) providing
a benchmark yield curve for the corporate debt market, (ii)
mitigating the impact of international financial crises on the
domestic economy, and (iii) facilitating absorption of capital
flows. The government bond market is the cornerstone of
domestic financial markets. It shapes the structure of the
corporate segment and leads the development of the fixed
income market more broadly.
Launched in 2008, AFMIs overarching objective is to promote
the development of local currency bond markets in Africa. This
will enable African governments to improve the terms at which
they borrow in the domestic financial markets while also
reducing their dependence on foreign currency denominated
debt. Local currency bond markets also provide an avenue for
the sustainable mobilization of long term financing for
infrastructure.
The AFMI is implemented through two separate but
complementary pillars namely:
5
Background and Rationale
i. African Financial Markets Database (AFMD)
ii. African Domestic Bond Fund (ADBF)
Access to accurate, reliable and quality financial data has al-
ways been a challenge for African market participants and de-
velopment partners. The Bank, through the AFMI has
developed a database (AFMD) to provide updated, reliable and
complete information on African local currency debt instru-
ments. Data collection began in 2009 with the collaboration of
18 Central Banks and Ministries of Finance and Debt Manage-
ment Offices (through nominated Liaison Officers). Since then,
forty-one countries have submitted data on regular basis for
their bond market infrastructure and/or fixed-income instru-
ments. To increase visibility and availability of data on African
debt markets and provide a channel through which to connect
stakeholders with the AFMD, the AFMI website (www.afri-
canbondmarkets.org), co-sponsored with the Canadian Inter-
national Development Agency (CIDA), was launched in May
2013. This website provides access to the data portal for users,
as well as other information on African domestic debt markets
including: a snapshot of bond markets (market structure, ins-
truments available and investment guidelines) across all African
countries, research articles as well as current financial market
news.
The purpose of ADBF to invest it in local currency denominated
sovereign, and sovereign guaranteed sub-national bonds. The
ADBF aims at stimulating the development of African domestic
bond markets as a source of funding for local borrowers, whilst
also creating a new asset class of African fixed-income
securities. The components of the ADBF project, co-
sponsored with the Fund for African Private Sector Assistance
(FAPA ) are the African Domestic Bond Index (ADBI) family, and
the ADBF, a Pan African bond fund to be designed and
structured for 2015. Indices can attract significant capital if they
are designed to be transparent, investable and representative,
and offer attractive returns. In developing regions it is
particularly important for the leading organizations to act to
reduce financial market impediments and instill local and
international investor confidence. The success of the ABF
(Asian Bond Fund) and GEMX (Global Emerging Markets Local
Currency Bond Index) initiatives are tributes to the efforts of
multinational and local organizations looking to develop their
local bond markets and move them to new and sustainable
levels. The ADBI Family focuses on what is an investor looking
for when investing in local bonds:
Are there bond markets in African countries?
Is the necessary infrastructure in place? Is bond data
available?
Do the legal and regulatory systems protect investor
rights?
Who are the potential investors for domestic debt?
What is the state of the economy? Can debt be
repaid? Will inflation and FX rates eliminate
investment returns?
Are there local institutions supporting bond markets
investors? and so on.
The ADBI family comprises a benchmark index and a
Fundamental index, which is presented in this report. The
benchmark index is the AFMI Bloomberg African Bond
Index (ABABI) which is a rules-based market value weighted
composite index calculated by Bloomberg BVAL Methodology.
The African Fundamental Bond Index (AFBI ) is a ranking of
African local bond markets established by the AFMI
1 FAPA is a Trust Fund established under the Enhanced Private Sector Assistance Initiative, launched by the Government of Japan and the AfDB in 2005
2 To be published soon
team/AfDB. In 2011, the Bank undertook a feasibility study
which lay the groundwork for the development of the African
index family. The study formed the basis for the discussions
with stakeholders in North, East, South, West and Central
Africa in 2012 to determine the AFBI inclusion criteria. These
results have been discussed and reviewed with stakeholders
and include their valuable input into the data model and the
ranking shared in 2013. Furthermore, the AFBI benefitted from
the G20 Diagnostic Framework analysis. In fact, in November
2011 the G-20 endorsed an action plan to support the
development of local currency bond markets (LCBM).
International institutions were asked to draw on their experience
to develop a diagnostic framework (DF) to identify general
preconditions, key components, and constraints for successful
LCBM development. The DF provides guidance on analyzing
the money market, government and corporate bond markets,
and the derivatives market. The key components of the
diagnosis include: the macroeconomic policy framework,
composition and needs of the issuer and investor bases,
primary and secondary market structures and related market
dynamics, regulatory and legal frameworks, and market
infrastructure. However, it should be acknowledged that the
degree of required and feasible local bond markets
development will depend on the size of the economy, level of
development, and the needs of the public and corporate
sectors.
The African Fundamental Bond Index (AFBI) series are reflective
of the recent developments of the local bond markets some of
1
which have gained in strength in terms of liquidity and maturity
profile using a common set of indicators (see the Diagnostic
6
framework), including macroeconomics variables; market
structure; and market liquidity. The African Fundamental Bond
Index (AFBI) would reveal the factors contributing to African
Local Currency Bond Markets structure, taking into account
that most the African debt markets are still at the early stage of
development. This index will provide the basis for designing a
strategy for African bond markets development and deepening,
with appropriate sequencing of policy action and associated
7
delivery of technical assistance (TA) where needed. The annual
AFBI report will be the barometer2 through which to identify the
priority reform measures in each market segment.
This report will be organized around two sections. Section 1 will
present the 2014 AFBI country rankings and scores built on
2013 data. Section 2 will present the AFBI factor weights and
methodology.
 Section1: 2014 AFBI Country Rankings and Scores

1.1 2014 Country rankings

Country Rank Total Macro Governance Bond Market Issuers, Is- Domestic Active
Score economic Infrastructure suing Strategy Investor Base participation
Conditions and Market ac- of Economic
cess Agents
South Africa 1 69.05 39.58 52.51 100.00 84.53 75.00 60.00
Mauritius 2 63.65 63.39 66.61 100.00 74.92 10.00 56.00
Nigeria 3 61.56 32.23 25.65 100.00 78.85 25.00 72.00
Botswana 4 59.54 47.22 65.35 100.00 66.40 35.00 50.00
Morocco 5 58.70 34.98 45.18 100.00 73.13 30.00 56.00
Kenya 6 58.57 27.04 33.56 100.00 71.37 27.50 68.00
Namibia 7 56.87 39.49 56.73 100.00 70.08 52.50 36.00
Egypt 8 56.38 29.76 31.77 100.00 75.79 45.00 46.00
Ghana 9 53.91 25.98 50.10 100.00 62.09 13.75 60.00
Zambia 10 52.75 27.11 45.68 100.00 62.06 15.00 56.00
Algeria 11 51.42 41.01 31.93 100.00 56.90 15.00 54.00
Tunisia 12 51.36 35.12 44.93 100.00 54.51 12.50 56.00
Tanzania 13 50.83 26.39 40.04 100.00 58.30 13.75 56.00
Seychelles 14 49.45 87.73 54.47 100.00 22.80 35.00 42.00
Gabon 15 48.89 67.51 42.09 100.00 53.51 10.00 30.00
Rwanda 16 48.41 23.87 50.08 65.00 60.23 12.50 56.00
Uganda 17 48.41 25.84 37.95 65.00 62.86 13.75 56.00
Swaziland 18 48.23 29.66 40.68 100.00 48.20 22.50 52.00
Mozambique 19 46.42 22.61 42.23 100.00 57.69 10.00 42.00
Senegal 20 42.81 23.62 44.80 100.00 57.61 10.00 26.00
Cabo Verde 21 42.11 27.55 58.83 100.00 31.98 10.00 46.00
Cote d'Ivoire 22 41.22 27.90 29.39 100.00 55.32 10.00 26.00
Cameroon 23 40.12 27.17 31.32 100.00 44.72 10.00 34.00
Burkina Faso 24 40.01 26.09 40.72 100.00 48.41 10.00 26.00
Benin 25 39.72 25.81 41.32 100.00 47.38 10.00 26.00
Equatorial Guinea 26 38.95 118.14 27.24 100.00 0.00 10.00 30.00
Togo 27 37.22 24.13 31.96 100.00 43.03 10.00 26.00
Niger 28 37.21 23.51 34.36 100.00 42.49 10.00 26.00
Congo, Republic 29 35.93 34.71 28.53 100.00 31.25 10.00 30.00
Mali 30 34.50 25.21 30.63 100.00 33.84 10.00 26.00
Chad 31 34.46 26.68 24.63 100.00 31.64 10.00 30.00
Lesotho 32 30.55 23.35 46.65 35.00 27.93 10.00 38.00
Angola 33 28.45 44.29 30.20 35.00 29.29 10.00 22.00
Gambia 34 27.92 22.03 42.31 65.00 11.26 10.00 38.00
Burundi 35 26.67 24.17 23.90 35.00 13.86 10.00 48.00
Madagascar 36 25.30 22.71 35.09 35.00 14.61 10.00 38.00
Malawi 37 23.75 21.15 42.36 26.25 15.72 10.00 32.00
Central African Republic 38 23.47 15.04 22.97 100.00 1.39 10.00 30.00
Guinea-Bissau 39 23.44 17.31 25.39 100.00 2.70 10.00 26.00
Libya 40 20.19 64.82 20.97 35.00 0.00 18.75 28.00
Mauritania 41 20.04 17.87 33.37 35.00 8.42 10.00 28.00
Guinea 42 19.40 22.61 25.53 35.00 6.53 10.00 28.00

9
Country Rank Total Macro Governance Bond Market Issuers, Is- Domestic Active
Score economic Infrastructure suing Strategy Investor Base participation
Conditions and Market ac- of Economic
cess Agents

Sierra Leone 43 18.03 26.65 34.04 26.25 0.00 10.00 28.00

Sudan 44 16.89 24.46 18.19 70.00 1.33 10.00 12.00
Ethiopia 45 16.69 22.70 32.81 0.00 6.67 10.00 28.00
Comoros 46 15.82 25.75 29.55 35.00 0.00 10.00 18.00
Djibouti 47 14.82 28.90 39.89 35.00 0.00 10.00 8.00
Sao Tome & Principe 48 14.51 27.30 39.19 35.00 0.00 10.00 8.00
Zimbabwe 49 14.13 18.75 23.14 35.00 0.00 10.00 16.00
Congo, Dem. Republic 50 13.96 25.06 17.03 35.00 0.00 15.00 18.00
Liberia 51 13.08 21.71 33.20 35.00 0.00 10.00 8.00
Eritrea 52 11.70 18.54 24.19 35.00 0.00 10.00 8.00
South Sudan 53 9.35 4.41 21.88 35.00 0.00 10.00 8.00
Somalia 54 7.16 1.50 4.34 35.00 0.00 10.00 8.00

1.2 Analysis of the Top Ten Countries market trading is limited. Mauritius has an efficient elec-
tronic trading and settlement system. However the
1) South Africa country has a small domestic investor base.

South Africa holds the top spot in the African market. A
sophisticated bond market coupled with efficient elec-
tronic trading and settlement processes afforded South
Africa the top position. The country led in the Issuers,
Issuing Strategy and Market Access and Domestic in-
vestor base criteria, which had the highest overall weight
of 30.0% and 10.0%. However, the country scored
poorly in the Macro-economic conditions factor, ranking
9 and 6 for governance.
2) Mauritius
Mauritius has a relatively well-developed financial sys-
tem. The country performed well in governance, ma-
croeconomic conditions and the Issuers, Issuing
Strategy and Market Access factors while the secondary
3) Nigeria
The Nigerian bond market is the second biggest bond
market in Africa. Nigeria performed well in the Bond
Market Infrastructure and in the Issuers, Issuing Strategy
and Market Access criteria. The country ranked 1st in
the Economics Agent Participation criteria. While its in-
vestor base is the second largest in Africa, it remains
small relative to the size of
the population and the GDP.
4) Botswana
Botswana performed well in the Bond Market Infrastruc-
ture, Governance and in the Issuers, Issuing Strategy
and Market Access criteria. There is a primary dealership

10
system in government bonds for both the primary and
secondary market. Despite this, the bond market re-
mains fairly illiquid as investors typically buy and hold go-
vernment securities.
The country was ranked 2nd in terms of Governance
and 4th with respect to the Investor Base criterion.crite-
rion.
5) Morocco
The financial markets in Morocco are well developed.
Morocco enjoys the most developed bond market in
North Africa and one of the most advanced on the conti-
nent.
All securities quoted on the Casablanca Stock Exchange
are traded by means of the electronic trading system
using trading terminals supplied to brokerage firms. Mo-
rocco was ranked 5th in the Issuers, Issuing Strategy
and 6th in the Investor Base.
6) Kenya
Government bond trading on the NSE has increased
considerably in recent years, notably the longest Trea-
sury bond is a 30-year bond,
making it one of the longest tenors in Africa. Kenya was
ranked 4th in the Bond Market Infrastructure and 2nd in
the Issuers, Issuing Strategy and Market Access criteria.
Kenya ranked 2nd and 5th in the Investor Base and Eco-
nomics Agent Participation criteria.
11
7) Namibia
The country has a fairly well-developed financial sys-
tem. Government securities dominate the long-term
debt market, representing almost 67% of outstanding
long-term securities in the country. Namibia is ranked
7th in the Issuers, Issuing Strategy and Market Access
criteria. Namibia ranked 2nd and 4th respectively in
the Investor Base and Governance. .
8) Egypt, Arab Rep.
Despite the political impasse in Egypt in 2013, the
country ranked 3rd for two criteria, the Issuers, Issuing
Strategy and Market Access criteria and Investor
Base.
9) Ghana
Ghanas bond market is relatively undeveloped but
there are encouraging steps being taken to improve li-
quidity and deepen the bond markets.
The country was ranked 3rd and 7th with respect to
Active Participation of Economic Agents and Gover-
nance criteria.
10) Zambia
Zambia ranks 10th overall. In the Bond Market Infra-
structure criteria Zambia scored highest amongst 31
countries. Zambia was ranked 6th and 10th for the
Active Participation of Economic Agents.
 1.3
Equatorial Guinea

118
Mauritius

88
Botswana Seychelles
Cabo Verde Gabon

67 65 59 57
Namibia Libya

68 65 63
Seychelles Mauritius

54 53
South Africa Botswana

47 44
Ghana Angola

50 50
Rwanda Algeria
Lesotho South Africa

41 40 39
Zambia Namibia
Morocco Tunisia
Tunisia Morocco

47 46 45 45 45
Senegal Congo, Rep
Malawi Nigeria
Gambia, The Egypt

35 35 35 32 30 30
Mozambique Swaziland

42 42 42 42
Gabon Djibouti
Benin Cote d'Ivoire
Burkina Faso Cabo Verde
Swaziland Sao Tome & Principe
Tanzania Cameroon
Djibouti Zambia

41 41 41 40 40 39
Sao Tome & Principe Kenya
Uganda Chad
Sierra leone

38 35
Madagascar
Graphical representation of scores by Factor

Niger Tanzania
Sierra Leone Burkina Faso

12
Kenya Ghana
Mauritania Uganda
Liberia Benin
Ethiopia Comoros

2. Governance
Togo Mali
Algeria Congo, Dem. Rep.
Egypt Sudan
Burundi

34 34 34 33 33 33 32 32 32 31
Cameroon
Mali Togo
Angola Rwanda
Comoros Senegal
Cote d'Ivoire Niger
29 28 28 27 27 27 27 27 27 26 26 26 26 26 26 25 25 24 24 24 24 24 24 23
Lesotho

31 30 30 29 29
1. Macro-Economic conditions (Scores)

Congo, Rep
Equatorial Guinea Madagascar
Nigeria Ethiopia
Guinea Guinea
Guinea-Bissau Mozambique
Chad Gambia, The
Eritrea Liberia
Malawi

27 26 26 25 25 24 24
Burundi
Zimbabwe Zimbabwe
Central African Rep Eritrea
South Sudan Mauritania
23 23 23 23 22 22 21 19 19 18 17

Guinea-Bissau

23 23 22 21
Libya
15

Central African Rep

18
Sudan
South Sudan

17
Congo, Dem. Rep.
4 2

4
Somalia Somalia
 South Africa Alger

100
Nigeria Benin
Egypt Bots
Mauritius Burki

85 79 76 75 73
Morocco Cabo
Kenya Came

100 100

71 70
Namibia Centr
Botswana Chad

66 63
Uganda Cong
Ghana Cote
Zambia Egypt
Rwanda Equat

62 62 60 58
Tanzania Gabo
Mozambique Ghan
Senegal Guine
Algeria Keny
Cote d'Ivoire Mali

100 100 100 100 100

58 58 57 55 55
Tunisia Mauri

54
Gabon Moro
Burkina Faso Moza

100
Swaziland Nami
Benin Niger

48 48 47 45
Cameroon Niger

100
Togo Seneg

43 42
Niger Seych
Mali South

100
Cabo Verde Swazi

13
Chad Tanza

34 32 32 31
Congo, Rep Togo
Angola Tunis

29 28
Lesotho Zamb

100 100

23
70
Seychelles Suda
Malawi Gamb
Madagascar Rwan

16 15 14
65 65 65
Burundi Ugan
Gambia, The Ango

11 8
3. Bond Market Infrastructure

Mauritania Buru
Ethiopia Como
Guinea Djibo

7 7 3
Guinea-Bissau Eritre
Central African Rep Guine

1 1
Sudan Lesot

4. Issuers, Issuing Strategy and Market Access

Congo, Dem. Rep. Liberi
Comoros Libya
Djibouti Mada
Equatorial Guinea Mauri
Eritrea Sao
Liberia Soma
Libya South
35 35 35 35 35 35 35 35 35 35 35 35 35 35 35

Sao Tome & Principe Zimb

Sierra Leone Cong
Somalia Mala
30 26 26

South Sudan Sierra

0

Zimbabwe Ethio
 75
Nigeria South Africa

53
Kenya Namibia

45
Ghana Egypt
South Africa Botswana

35 35
Rwanda Seychelles
Zambia Morocco

30 28
Tanzania Kenya
Morocco Nigeria

25 23
Mauritius Swaziland
Tunisia Libya

72 68 60 60 56 56 56 56 56 56 56
Uganda Algeria
Algeria Zambia

19 15 15 15
Swaziland Zimbabwe

54 52 50
Botswana Ghana
Cabo Verde Tanzania
Burundi Uganda
Rwanda

48 48 46
Egypt
Mozambique Tunisia

14 14 14 13 13 10
Seychelles Angola
Madagascar Benin

10
Gambia, The Burkina Faso
Burundi

42 42 38 38 38
Lesotho

10
Namibia Cameroon
Cameroon Cabo Verde

10
Central African Rep

36 34 32
Malawi
Gabon Chad

10
Congo, Rep Comoros

14
Chad Congo, Dem. Rep.

10
Central African Rep Congo, Rep
Equatorial Guinea Cote d'Ivoire

10
Ethiopia Djibouti
Sierra Leone Equatorial Guinea

10
Mauritania Eritrea
Guinea Ethiopia 10
Cote d'Ivoire Gabon
5. Domestic Investor Base

Senegal Gambia, The

10

Burkina Faso Guinea

Togo Guinea-Bissau
10

Mali Lesotho
Benin Liberia
10

Niger Madagascar

6. Active participation of Economic Agents

Malawi

30 30 30 30 30 28 28 28 28 26 26 26 26 26 26 26 26
Guinea-Bissau
10

Angola Mali
Congo, Dem. Rep. Mauritania
10

Mauritius

22 18 18
Comoros
Zimbabwe Mozambique
10

Libya Niger
Sao Tome & Principe

16 12 12
Sudan
10

Djibouti Senegal
Sao Tome & Principe Sierra Leone
10

Eritrea Somalia
Liberia South Sudan
10

Somalia Sudan

8 8 8 8 8 8
South Sudan Togo

I
n the construction of the AFBI, the following six factors
and weights are used for analysis: (i) Macroeconomic
(15%); (ii) Governance (10%); (iii) Bond Market
Infrastructure (10%); (iv) Issuing Strategy and Market
Access (30%); (v)Domestic Investors Base (10%) and;
(vi) Active Participation of Economic Agents (25%).
2.1. Macro-Economic Score Overall factor weight 15%
The macro-economic environment of a country is a very
important consideration in determining the level of
development of an economy. Various coincident and
lagging factors help define the health of an economy.
However, while the foregoing may be the case, this
criterion in itself does not determine the level of
sophistication of the bond markets in an economy.
Therefore, the weight allocated to this criterion is at 15%.
Four sub-factors were considered under the
Macroeconomic score: (i) GDP per capita; (ii) real GDP
growth; (iii) total debt outstanding as a percentage of
GDP; and (iv) exchange rates.
Interpreting the overall score: The Macroeconomic score
is intended to be an indicator of a countrys ability to
generate wealth, control inflation, debt levels and
maintain or improve the value of its currency. Thus, it is
a reflection of the quality of the macroeconomic and
fiscal policy management.
Scores above 80 are indicative of countries that
are high performers
Scores between 60 80 are above average
performers
Scores between 50- 60 are average performers
Score below 50 are underperformers
15
Section 2: Methodology
2.2. Governance Overall factor weight 10%
Key to encouraging increased investor participation in
any economy is the availability of a legal framework and
the rule of law, which ensure a structured approach to
resolving conflicts. Coupled with this is a proper
regulatory framework, which promotes good
governance. The weight allocated to this criterion is
10%.
Each sub-factor was evaluated separately and the
scores aggregated to a single overall score. All data was
sourced from the World Bank Governance Indicators: (i)
Political Stability; (ii) Government Effectiveness; (iii)
Regulatory Quality; (iv) The rule of Law; and (v) Control
of corruption.
Interpreting the overall score: The Governance score
summarizes political, legislative, executive and judicial
quality. These factors and their long-term stability or
improvement are important for investors.
Scores above 80 are indicative of countries that
are high performers
Scores between 60 80 are above average
performers
Scores between 50- 60 are average performers
Score below 50 are underperformers
2.3. Bond Market Infrastructure score Overall factor
weight 10 %:
A sound and robust bond market infrastructure is
essential for the proper and efficient functioning of a
bond market. Further, the level of sophistication of the
bond market is highly correlated to factors such as
availability of automated trading and settlement
platforms and settlement cycles. In coming up with a
bond index, it is imperative that there is adequate
infrastructure to support the frequent trading of bonds.
Three sub-factors were considered under the Bond
Market Infrastructure factor: (i) settlement cycle; (ii)
availability of electronic trading platforms; and (iii)
availability of clearing and settlement systems.
Interpreting the overall score: This indicator
summarizes the Bond Market Infrastructure as follow:
Scores above 80 are indicative of countries that
are high performers
Scores between 60 80 are above average
performers
Scores between 50- 60 are average performers
Score below 50 are underperformers
2.4. Issuers, Issuing Strategy and Market Access score
Overall factor weight 30%:
This section evaluates the perception of sovereign
borrowers by rating agencies, the value of the bonds
outstanding, the amount of secondary market trading
activity (liquidity), and whether there is any discernible
issuing strategy by each country. Five sub-factors
were considered under this factor: (i) country risk
assessment; (ii) active and functioning Money Market;
(iii) bonds in the markets; (iv) availability and quality of
bond data and prices; and (v) issuing strategy and
maturity structure.
Interpreting the overall score of the factor. This
score summarizes the perception of international
rating agencies of each country, the existence and
functioning of the bond markets and the governments
16
success in implementing a bond issuing strategy. A
higher score is an indication of a more active, defined
and structured capital market.
Scores above 80 are indicative of countries
that are high performers
Scores between 60 - 80 are above average
performers
Scores between 50 - 60 are average
performers
Score below 50 are underperformers
2.5. Domestic Investor Base score Overall factor
weight 10%:
The Investor Base for each country was determined
by identifying the total assets held by pension funds,
mutual funds and insurance companies. The country
scores are comprised of: (i) the absolute value of the
combined assets; (ii) the value of the combined assets
relative to GDP; and (iii) the value of the combined
assets in relations to population.
Interpreting the scores. The Investor Base score
shows the size and strength of the domestic investor
base. A higher score indicates a larger and stronger
local investor base that can invest in local assets.
Scores above 80 are indicative of countries
with a very substantial domestic
investor base
Scores between 60 80 have an above
averagedomestic investor base
Scores between 50- 60 have an average
investor base
Score below 50 have a small or insignificant
investor base
2.6. Active participation of Economic Agents Overall
factor weight 25%:
The evaluation of this factor is based on scoring of two
indicators. Each was evaluated and the scores have been
aggregated to a single overall score. Two sub-factors
were considered under this factor: (i) institutions and
organizations relevant to the Financial Markets; and (ii)
diversity of active participants.
Interpreting the overall score: The Active Participation
of Economic Agents Score shows the plurality and the
diversity of the bond market participant. A higher score
indicates that numerous actors are present on the market
and there is a large diversity between these market
players:
17
Scores above 80 are indicative of countries with
a very substantial active participation of
economic agents.
Scores between 60 -80 are indicative of
countries with an above average active
participation of economic agents
Scores between 40-60 are indicative of
countrieswith an above average active
participation of economic agents
Scores between 20-40 are indicative of
countries with an average active participation of
economic agents
Scores below 20 are indicative of countries
with a small or insignificant active
participation of economic agents
1. Central Banks

Algeria www.bank-of-algeria.dz
Botswana www.bankofbotswana.bw
Burundi www.brb-bi.net
Cape Verde www.bcv.cv
Congo, Dem. Rep. www.bcc.cd
CEMAC www.beac.int
Djibouti www.banque-centrale.dj
Egypt, Arab Rep. www.cbe.org.eg
Eritrea www.boe.gov.er/
Ethiopia www.nbe.gov.et
Gambia, The www.cbg.gm
Ghana www.centralbank.org.ls
Guinea www.bcrg-guinee.org
Kenya www.centralbank.go.ke
Lesotho www.centralbank.org.ls
Liberia www.cbl.org.lr
Libya www.cbl.gov.ly
Madagascar www.banque-centrale.mg
Malawi www.rbm.mw
Mauritania www.bcm.mr
Mauritius http://bom.intnet.mu
Morocco www.bkam.ma
Mozambique www.bancomoc.mz
Namibia www.bon.com.na
Nigeria www.cenbank.org
Rwanda www.bnr.rw
Seychelles www.cbs.sc/
Sierra Leone www.bankofsierraleone-centralbank.org
Somalia www.somalbanca.org
South Africa www.reservebank.co.za
Sudan www.bankofsudan.org
Swaziland www.centralbank.org.sz
Tanzania www.bot-tz.org
Tunisia www.bct.gov.tn
Uganda www.bou.or.ug
WAEMU www.bceao.int
Zambia www.boz.zm
Zimbabwe www.rbz.co.zw

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2. Stock Exchanges
Botswana Stock Exchange www.bse.co.bw
Bolsa de Cabo Verde www.bvc.cv
Egypt Stock Exchange (EGX) www.egyptse.com
Ghana Stock Exchange www.secghana.org
Ghana Stock Exchange www.secghana.org
Nairobi Securities Exchange www.nse.co.ke
Malawi Stock Exchange www.mse.co.mw
Mauritius Stock Exchange www.semdex.com
Casablanca Stock Exchange www.casablanca-bourse.com
Namibia Stock Exchange www.nsx.com.na
Nigerian Stock Exchange www.nigerianstockexchange.com
Johannesburg Stock Exchange www.jse.co.za
Khartoum Stock Exchange www.khartoumstock.com
Swaziland Stock Exchange www.ssx.org.sz
Dar Es Salam Stock Exchange www.dse.co.tz
Bourse de Tunis www.bvmt.com.tn
Lusaka Sock Exchange www.luse.co.zm
Uganda Securities Exchange www.use.or.ug
Zimbabwe Stock Exchange http://www.zimbabwe-stock-exchange.com/

3. Regulators
COSOB (Algeria) www.cosob.com.dz
Securities and Exchange Commission Ghana www.secghana.org
Capital Markets Authority Kenya www.cma.or.ke
Mauritius www.gov.mu
Conseil dontologique des valeurs mobilires www.cdvm.gov.ma
Nigeria www.secngr.org
Capital Markets Advisory Council Rwanda www.cmac.org.rw
Seychelles International Business Authority www.siba.net
Financial Services Board South Africa www.fsb.co.za/
Capital Markets & Securities Authority Tanzania www.cmsa-tz.org/
Commission dOrganisation et de Surveillance des Oprations la www.cosob.org/
Bourse (COSOB) - Algeria
Commission Bancaire de lAfrique Centrale - COBAC www.beac.int/cobac
Capital Markets Authority of Uganda www.cmauganda.co.ug

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4. Data Providers

African Development Bank (AfDB) www.afdb.org/

allafrica.com www.allafrica.com

BGL Pension Report 2010 www.bglgroupng.com/docs/pension_report.pdf

Bloomberg www.bloomberg.com/

Euler-Hermes Country risk assessment www.eulerhermes.com/en/country-risk/country-risk.html

Global Pension Study 2011 Watson Wyatt www.towerswatson.com/

IFC paying taxes www.pwc.com/gx/en/paying-taxes

International Monetary Fund (IMF) www.imf.org/external/data.htm

Investment Company Institute www.ici.org

MBendi Information Services www.mbedi.com

The Heritage Foundation www.heritage.org/Index/

Thomas Murray www.thomasmurray.com/

World Bank http://data.worldbank.org/

5. Further Sources

AfDB Fixed Income Guidebook www.afdb.org/en/documents/publications/african-fixed-income-

guidebook/

African Financial Markets Initiative (AFMI) www.afdb.org/en/topics-and-sectors/initiatives-

partnerships/african-financial-markets-initiative-afmi/

African Securities Exchanges Association (ASEA) www.africansea.org

Ambrosi, Monica; The Development of Afican Debt Markets; The www.cma.gov.om/.../ba7f3548-ba14-40f0-9e76-

South African experience & key findings d58e3433abf7.doc
International Country Risk Guide www.prsgroup.com/icrg.aspx

MAROCLEAR - Dpositaire Central des titres au Maroc www.maroclear.com

STICODEVAM (Socit Tunisienne Interprofessionnelle pour la www.sticodevam.com/site/fr/index.php

Compensation et le Dpt des Valeurs Mobilires)

21
 Contact

African Financial Markets Initiative (AFMI) http://www.africanbondmarkets.org

African Development Bank Twitter: @afmi_afdb
Immeuble CCIA Avenue Jean-Paul II BP 1387 Facebook: AfricanFinancialMarketsInitiative
Abidjan 01 Cte dIvoire Email: afmi@afdb.org
Tel: +225 20 26 3813

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THE AFRICAN FUNDAMENTAL BOND INDEX