Benin’s planned government bond sale has been put on hold while the timing for one from Georgia is also in flux, according to investors, after US President Donald Trump’s aggressive push to take control of Greenland caused widespread market jitters.
Financial markets have been unsettled in recent days after Trump vowed over the weekend to impose trade tariffs on eight leading European allies until the United States was allowed to buy Greenland.
The US President said in a speech at the Davos economic forum on Wednesday that he would not use force to take Greenland but called for “immediate negotiations” to acquire it from Denmark.
The tensions ahead of his speech had seen US Treasury yields, which form the baseline for global borrowing costs, soar to multi-month highs, leaving risk-sensitive emerging markets wary of pushing ahead with debt sales.
According to IFR, books had still not opened for a Benin deal that was originally due to come to the market on Tuesday.
Investors said there was also no sign of a planned Georgia bond sale. The country had held roadshows with investors on Monday and Tuesday for a new five-year dollar bond and a buyback of an existing bond maturing later this year.
“The bankers have said the deals have been put on hold for now,” Aberdeen portfolio manager Viktor Szabo said, adding he had expected Georgia to launch its sale on Wednesday.
A second fund manager, who requested anonymity, confirmed that bankers had communicated the delays and said that a Trinidad and Tobago bond sale expected for Thursday was another one that possibly might be affected.
In contrast, investment-grade emerging market bond sales from the likes of Saudi Arabia’s Public Investment Fund (PIF), were still going ahead.
The jitters come after a red-hot start to the year in which emerging market governments from Mexico to North Macedonia have sold around €51.4 billion ($60 billion) worth of debt between them – over €21.3 billion ($25 billion) more than at this stage last year.
Citigroup, JPMorgan and HSBC, three of the joint lead managers on the Benin bond sale, declined to comment. The other lead managers, Emirates NBD Capital, as well as Société Générale, that are involved in Georgia’s sale, did not immediately respond to a request for comment.