Nigeria is set to make a major return to the global fixed-income market as J.P. Morgan includes the country in its new frontier-market bond index, nearly 11 years after it was removed from the bank’s widely followed government bond benchmark. Nigeria will receive a 7.4 percent weighting, placing it among the largest markets represented in the new index.
The new benchmark, known as the Government Bond Index–Emerging Markets Edge (GBI-EM Edge), is expected to launch by the end of September 2026. According to Reuters, the index will track about $330 billion in local-currency government debt across 26 countries, with Nigeria joining major constituents including Egypt, Vietnam, Morocco, Kazakhstan, Bangladesh, Pakistan and Sri Lanka.
For Nigeria, the inclusion could increase international visibility for its domestic government securities and potentially attract greater interest from global fixed-income investors. J.P. Morgan has set an individual country weighting limit of 8 percent, meaning Nigeria’s 7.4 percent allocation puts it close to the maximum and highlights the size and relevance of the country’s bond market within the new benchmark.
The index is expected to feature government bonds with a minimum equivalent value of $250 million and at least 2.5 years remaining to maturity. African markets are projected to account for almost 45 percent of the index, while frontier Asian markets are expected to make up nearly one-third. The benchmark is also expected to carry an average nominal yield of about 10.4 percent, significantly higher than J.P. Morgan’s mainstream emerging-market local-currency index.
Nigeria’s return follows years of efforts to regain access to major international bond benchmarks and comes months after the Federal Government disclosed that it was in talks with J.P. Morgan over re-entry. The development could strengthen the profile of Nigerian government securities among international investors, particularly as global funds continue to seek higher-yielding opportunities in frontier markets.
source: The cable
