(Ecofin Agency) - Yesterday, Côte d’Ivoire successfully raised CFA109 billion ($183.6 million) in the regional public securities market. Through this latest auction of Treasury bills and bonds (BAT and OAT), the country exceeded its initial goal of CFA100 billion. This success comes despite ongoing global and regional economic pressures from inflation and high interest rates.

Ivorian investors played a significant role, contributing CFA106 billion, or 86% of the total amount raised. The auction attracted a total of CFA118.68 billion in bids, with CFA109.55 billion ultimately accepted. This outcome is credited to the Ivorian authorities' strategy of balancing short-term maturities (91 and 364 days) with medium-term bonds (3 and 5 years).

In detail, the 91-day Treasury bills saw a coverage rate of 118.68%, while the 364-day bills followed closely with 109.55%. The 3-year and 5-year bonds were fully subscribed, each achieving a 100% coverage rate.

However, to secure these funds, Côte d’Ivoire had to offer attractive yields in a global environment marked by rising interest rates. The 91-day Treasury bills offered a weighted average yield of 2.48%, while the 364-day bills reached 7.20%. Longer-term bonds also offered competitive yields, with the 3-year bonds at 7.42% and the 5-year bonds at 7.64%.

These yield levels reflect the ongoing inflationary pressures and rising benchmark rates in international markets, which force issuers to offer higher risk premiums to attract investors. While Côte d’Ivoire's rates remain competitive within the WAEMU space, the country is less affected than some of its neighbors, where yields range between 9% and 10%. According to several WAEMU asset managers, regional yields are expected to stay above 7% until at least the first quarter of 2025.

With this new operation, Côte d’Ivoire strengthens its position as the leading borrower in the regional bond market, having already raised over CFA1,900 billion this year. Before this latest auction, the country had conducted 18 auctions of 91-day Treasury bills, 28 of 364-day bills, and multiple issuances of 3-year and 5-year bonds. This strategy is part of an active public debt management approach, aiming to balance immediate financing needs with medium-term repayment pressures.

In September 2024 alone, Côte d’Ivoire must repay CFA348 billion in debt to market investors. This fundraising provides a much-needed financial boost as Abidjan navigates between meeting debt obligations and securing new loans.

The key question now is whether Côte d’Ivoire can continue raising funds in the regional market on "favorable terms," as economic pressures intensify and the need for financing remains high.