Have we totally and utterly lost our blimin’ marbles?
Why do I ask this question?
Is it because I am a middle aged man who reads the Telegraph, and that’s what middle aged men who read the Telegraph are supposed to ask.
No, the reason is a bit more exotic. The reason is Rwanda.
Yes that’s right, Rwanda. It’s a country in Africa. Tiny place right next to a very big place called the Democratic Republic of Congo, which incidentally is the country where Tintin, the famous Belgian reporter, got himself into a spot of bother with the natives and had the ensuing biography banned in certain circles, on account of it being a bit racist.
In those days they called it just The Congo, and left the “Democratic Republic” bit out. Don’t know why they threw it in later, because the country is about as democratic as a social democrat party shindig, which makes it a click-and-a-half away from the North Korean politburo annual conference.
But I digress.
Back to Rwanda. Today Rwanda floated 400 million US dollars worth of bonds. Nothing new here, African countries are pretty experienced in all things debt related.
The thing is this. It was a 10-year bond with a yield of a little under 7%. How much money do you think this attracted? Did they get the full 400 million dollars? Boy oh boy did they. The bond attracted 3.5 billion dollars of offers. Yes 3.5 billion! That means it was nearly 9 times oversubscribed.
Far be it from me to question the intentions of the long-suffering good people of the 22nd most impoverished nation on the planet. Where the average annual income is 460 dollars and 18% of the country’s GDP is made up of international aid. But hand on heart now dear reader, honestly, would you put your money in to that at a little above 6%?
Guess what though? You did, lot’s of that money will be your pension money searching for yield. In Rwanda.
Maybe they should have gone safe and just put it in Nigeria instead. Nigeria is yielding around 4% for their 10-year bond.