Nigeria Eyes Return to JP Morgan GBI-EM 9.5 Years After Removal
Nigeria is looking to return to the JP Morgan Government Bond Index-Emerging Markets (GBI-EM) on the back of major foreign exchange reforms, the head of its Debt Management Office has said.
The country was removed from the JP Morgan GBI-EM in September 2015 owing to its failure to meet the necessary criteria for inclusion, primarily related to liquidity and accessibility of its government bonds.
“With the recent reforms in the foreign exchange market, we believe Nigeria meets the criteria to rejoin the index,” Patience Oniha, director-general of DMO, said in Washington at the IMF/World Bank meetings.
The debt office said on social media platform X that Oniha and Central Bank of Nigeria Governor Olayemi Cardoso highlighted a stabilising naira and rising investor confidence
“Now is the best time to invest in Nigeria,” she said.
The JP Morgan GBI-EM plays a significant role in the global financial landscape including serving as a benchmark for asset managers and institutional investors seeking exposure to emerging market government bonds. By including a range of bonds from emerging markets, it allows for risk spreading and potential yield enhancement.
The GBI-EM includes bonds that are generally considered liquid, making it easier for investors to enter and exit positions. The index’s criteria ensure that the included securities have a market that can support substantial trading activity.
Many investment funds track the GBI-EM or use it as a reference point in developing investment strategies, which helps to shape capital flows into emerging markets.
The index can also serve as a barometer for investor sentiment towards emerging markets. Changes in the index—such as countries being added or removed—often reflect broader economic and political developments in those regions.
By establishing criteria and standards for inclusion, the GBI-EM encourages emerging market countries to improve the transparency, stability, and accessibility of their bond markets.
