Faure Gnassingbé says Togo will try to raise €500M in international capital markets
Monday, 10 June 2019 15:16 
(Togo First) - In the next three months, Togo plans to raise €500 million in international finance markets. This was confirmed by the country’s president himself, Faure Gnassingbé, during an interview in London.
The news comes a little after U.S ratings agency Standard & Poor’s published, for the first time ever, its short and long term credit rating for Togo’s debt in local and foreign currency. Giving the country a ‘B’ rating, the American firm commented :
“We expect economic activity will benefit from the recent upgrading of key infrastructures, such as the completion of extensive works at the port of Lomé, which is currently the only deep-water port in West Africa, and the opening of the new terminal at the Gnassingbé-Eyadema airport in 2016.”
A Eurobond guaranteed by the World Bank?
According to Togo’s leader, monies raised (with a longer maturity) will mostly be used to serve internal debt (which has a shorter maturity) as it tends to be more costly.
Lomé mentioned it may resort to a Eurobond, a syndicated loan or a multilateral institution. However, a Eurobond is more likely as the Togolese currency, the CFA is pegged at fixed parity to the Euro which is more stable.
On another side, there is the World Bank which is said to be working, under a new Country Partnership framework, to grant Togo IDA guarantees for the operation.
Reducing pressures to refinance internal debt, a major challenge
In 2016, Togo’s debt stood at 82% of its GDP, spurred by huge investments in infrastructures. However, in the past two years, the country, backed by a three-year IMF program started mid-2017, reduced its debt by more than 10%; A performance lauded by the Fund which now estimates the risk of external over-indebtedness to be “moderate.”
This performance also coincides with pressures to refinance internal debt over the next five years, as well as with the recent launch of the national development which will require more than $8 billion, 65% of which will come from private sector.
Togo could become Africa’s 22nd nation to issue a Eurobond
If Togo opts for a Eurobond, it would follow the lead of Côte d’Ivoire, Senegal and Benin. The latter raised €500 million leveraging the bond.
According to London-based Investment Bank Renaissance Capital, quoted by Financial Times, Togo would hence become the 22nd African nation to issue a Eurobond.
