Iran war fallout fails to halt African debt issuances

African governments are continuing to raise funds successfully from international capital markets, as demand for African debt remains resilient despite fears that the conflict in Iran would curb investor appetite. An executive at Citibank recently noted that the volume of African sovereign bond deals it has worked on has increased by more than two-thirds in 2026, with the bank saying it has helped African governments raise a combined $6.2bn in debt – about 70% more than the same period in 2025. Leo Morawiecki, emerging market debt investment specialist at Aberdeen Investments, tells African Business that the economic ramifications of the war in Iran have – at least not yet – proved to be as bad for Africa as previously feared. He notes that “we have seen very few second-order effects from the Iran war. There has been an increase in food and energy prices, but this has not led to a big spike in inflation across other parts of the consumption basket.” “Oil at $80 a barrel is an ok scenario for the majority of Africa and there is obviously a lot of net oil exporters within the region anyway.” ‘Market access still there’ “We are still seeing new issuances in the market. Angola issued a bond earlier this year; the DRC and the Republic of Congo both did as well,” he says. “I think this reflects the fact that the current external shock is not as large as post-Covid and after the Russia-Ukraine war, which caused big spikes in energy and food prices. The fundamental position of a lot of these issuers is better – and I think the market recognises that, which is why market access is still there,” Morawiecki adds. “Foreign exchange reserves in several countries in Sub-Saharan Africa are improving, with countries like Ghana, Angola, Ivory Coast, and the DRC to a lesser extent, all posting very small current account deficits or even surpluses. They are moving in the direction of IMF programmes, trying to clear arrears, and I think the market has taken that quite positively.” Increase in private placements Morawiecki also notes that there has been an increase in private placement issuances on the continent – issuances where governments sell bonds directly to a small group of institutional investors and bypass the public market. While this comes at a premium, the process can allow governments to raise funds more quickly and with less market scrutiny than would otherwise be possible. In May this year, the Republic of Congo raised $850m in a private placement, with the proceeds being earmarked to refinance domestic debt – an issuance which followed a similar $700m raise in February. In December last year, Angola raised a yen-denominated private placement through Japan’s “samurai market.” Gabon and Cameroon are two other countries which have also raised funds in such a way. Beyond the relatively strong economic performance of African economies amid global instability, Morawiecki also suggests that current conditions on international bond markets are also working to the continent’s advantage. “Spreads are very tight across the bond world – there are not a lot of places where you can get double-digit yields, which means there is a lot more interest in places where there previously has not been…Investors would not really have looked at Gabon or Cameroon or the DRC in as much depth a couple of years ago,” Morawiecki adds.