In this piece, we will take a look at the five countries with the highest bond yields. For more countries, head on over to 15 Countries With The Highest Bond Yields.
5. Federal Republic of Nigeria
10 Year Bond Yield as of November 30th, 2022: 14.522%
The Federal Republic of Nigeria is the largest economy in Africa and the most ethnically diverse country in the world. More than 250 ethnic groups live in the country. Its economy was worth $1.3 trillion in 2022, with a GDP per capita of $5,853. The largest share of the economy is in agriculture, and the Federal Republic of Nigeria is also one of the largest petroleum producers in the world. The country’s biggest trading partner is India, and its exports stood at $53.6 billion in 2019. China is the Federal Republic of Nigeria’s largest import partner, accounting for close to one fifth of the country’s imports.
4. Republic of Uganda
10 Year Bond Yield as of November 30th, 2022: 17.841%
The Republic of Uganda gained independence from the British monarchy in 1962. Its economy was worth $113 billion in 2020, with GDP per capita standing at $2,752. The country is one of the world’s largest exporters and producers of coffee, and it primarily relies on agricultural products and gold for its exports. The Republic of Uganda’s exports stood at $3.3 billion in 2017. However, its imports were $5 billion, leaving a large current account deficit of $1 billion. Yet, it had considerable foreign exchange reserves (for its size) of $7 billion, which were sufficient to cover the deficit and ensure that the country could also service some of its debt.
3. Arab Republic of Egypt
10 Year Bond Yield as of November 30th, 2022: 19.507%
The Arab Republic of Egypt is a part African, part Asian country that is best known for having hosted the civilizations of the ancient world. It is called the land of the pharaohs, and the tombs of these kings continue to create awe and mystery due to their size. The country’s economy runs on fossil fuel exploration, tourism, agriculture, and media. It was worth $1.7 trillion in 2022 with a per capita GDP of $15,958. However, the Arab Republic of Egypt ran a large current account deficit of $33 billion in 2021, and in 2022, it has a gross external debt of $158 billion – two factors that explain the astronomically high bond yields of the country.
2. Republic of Zambia
10 Year Bond Yield as of November 30th, 2022: 30.06%
The Republic of Zambia is a former British colony that gained independence in 1964. It is a landlocked country that relies primarily on copper for exports. The country’s GDP equaled $76 billion and its GDP per capita stood at $3,808 in 2022. Additionally, the Republic of Zambia’s exports of $11 billion outstripped its $6.9 billion in imports in 2021, lending it a rather solid footing. However, the country was also the first African nation to default its bond obligations in 2020, as a drop in global activity in the wake of the coronavirus pandemic led to copper prices crashing as well and drying a key source of revenue for the Zambian government. The Republic of Zambia’s bonds are currently rated as Restricted Default by both Fitch and S&P Global Ratings, leaving no question about why its debt yield is so high.
1. Democratic Socialist Republic of Sri Lanka
10 Year Bond Yield as of November 30th, 2022: 30.836%
The Democratic Socialist Republic of Sri Lanka, or Sri Lanka, is an Asian island nation. Its history goes back thousands of years, and the country primarily exports tea and textiles. While Sri Lanka’s GDP stood at $319 billion in 2021, owing to its small population, the country had one of the highest GDP per capita of $14,230 in South Asia in 2021. However, it was the first country to default in 2022, after its $1.9 billion of foreign exchange reserves were insufficient to meet the debt repayment obligations of $4 billion for the year. A United Nations report blamed corruption and human rights abuses as two of the key reasons behind the economic disaster that led to inflation soaring to a devastating 61% in November 2022. The Lankan people painfully suffered due to economic mismanagement, with hospitals running out of tracheal tubes for babies and a ban on fuel sales for non essential transport vehicles.
Disclosure: None. You can also take a look at 10 Best Robotics Stocks Under $10 and 15 Biggest Fintech Companies in the World.
