Uzbekistan`s eurobond issue ‘rides appetite for riskier assets’

on November 19 Uzbekistan placed a dual-tranche eurobond denominated both in dollars and local currency in the amount of $750mn on the London Stock Exchange (LSE).

In assessing the issue, Bloomberg said it comes as Joe Biden’s win in the US presidential election and progress in securing coronavirus (COVID-19) vaccines spurs appetite for riskier assets, driving emerging-market yields to a record low.

According to analysts, Uzbekistan, ranking three notches below investment grade at Fitch Ratings and S&P Global Ratings, may benefit from IMF predictions that it will be among the few nations to post economic growth this year.

Moreover, according to Bloomberg, Uzbekistan may be the only CIS country to see growth this year.

“A young population has helped Uzbekistan weather the coronavirus better than its neighbors and its economy has also benefited from a tilt toward agriculture, manufacturing and construction,” Sofya Donets, chief economist at Renaissance Capital in Moscow, said.

In the eurobond placement, Uzbekistan sold $555mn in 10-year notes at 3.7%, according to the finance ministry. It also priced UZS 2 trillion ($193 million) of three-year notes in its local currency.

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