Another Blow To The Economy As Barclays To Remove Nigeria From Emerging Markets Local Bond Index

Barclays monday announced that it would remove Nigeria’s sovereign debt from its emerging markets local currency government bond benchmark from February 1, 2016.

The announcement came a few weeks after United States investment bank, JP Morgan & Chase, removed the country from its Government Bond Index for Emerging Markets (GBI-EM).

Barclays was quoted by Reuters to have explained: “Nigeria will be removed from the flagship Emerging Markets Local Currency Government Index as of February 1, 2016,” adding that the debt would continue to be eligible for its broader Emerging Markets Local Currency Government Universal Index.

The index provider had said it would drop Nigeria from its index and had cited same lack of liquidity and currency restrictions that JP Morgan gave to delist Nigerian bond from its index. In fact, Barclays had last month disclosed that it listed Nigeria’s eligibility for inclusion in the Emerging Market Local Currency Government Index among the primary topics to be considered in its yearly review process this month.

The international bank had in March 2013 admitted 13 FGN Bonds with a value of $13.9 billion on the index. Nigeria and Romania were the two countries whose governments’ local currency bonds were added to the Index same month.

Africa’s largest economy has taken a hammering from the steep drop in oil prices since mid-2014. Barclays also said that Russia and Argentina would become eligible for its Emerging Markets Government Inflation-LinkedI Bond (EMGILB) Index as of February 1, 2016.