Beyond Aid: How Much Should African Countries Pay to Borrow?

Beyond Aid: How Much Should African Countries Pay to Borrow?

Author: 
Gueye, Cheikh A.
Publisher: 
Oxford University Press (OUP)
Date published: 
2015
Record type: 
Responsibility: 
N. R. Sy, Amadou, jt. author
Journal Title: 
Journal of African Economies
Source: 
Journal of African Economies, Vol. 24, No. 3, June 2015, pp. 352-366
Abstract: 

Post debt relief, the number of African countries considering accessing international capital markets, often to fund large infrastructure projects, is increasing. Potential risks of capital inflows are well known but the literature offers little help to estimate the cost of borrowing internationally for the first time. This article proposes a two-step approach to estimate the sovereign credit rating and interest rate cost of a country considering borrowing externally. Estimates can be used to assess the costs and benefits of different financing options. The method can also be used to construct foreign currency as well as domestic local currency yield curves.

Language: 

CITATION: Gueye, Cheikh A.. Beyond Aid: How Much Should African Countries Pay to Borrow? . : Oxford University Press (OUP) , 2015. Journal of African Economies, Vol. 24, No. 3, June 2015, pp. 352-366 - Available at: http://library.au.int/beyond-aid-how-much-should-african-countries-pay-borrow