July 30, 2021/United Capital Report

Anglophone West Africa
Nigeria

• Nigeria held its fourth Monetary Policy Committee meeting of the year this week. The committee held all policy parameters constant, keeping the Monetary Policy Rate (MPR) at 11.5%, the asymmetric corridor at +100bps/-700bps, the Cash Reserve Ratio (CRR) at 27.5%, and the Liquidity Ratio (LR) at 30.0%.
• The Central Bank Governor announced that the apex bank will discontinue the sale of foreign exchange (FX) to Bureau De Change (BDCs) operators in the country and further stop the issuance of BDC licenses.
• According to the Benue State Commissioner for Health and Human Services, the Federal Government is set to release N36.0bn to states in order to battle the third wave of COVID-19 before the end of July. This comes after a surge in Covid-19 cases to levels last seen in March.
• The U.S. government announced that it will ship 4 million doses of the Moderna covid-19 vaccines to Nigeria to battle the third wave of infections. This comes amid growing concern about vaccination rates in Africa, which lag far behind those of advanced economies.
• The National Bureau of Statistics (NBS) disclosed in a report that the total value of capital importation into Nigeria declined to $875.6m in Q2-2021 from $1.9bn in Q1-2021. This represented a decrease of 54.1% m/m compared to Q1-2021 and a 32.4% y/y decrease compared to Q2-2020.

Ghana

• According to the Central Bank, Ghana’s public debt rose to GH¢332.4bn as of May-2021, 76.6% of its GDP. This is 14.0% higher than the GH¢291.6bn as of Dec-2020 which was 76.1% of GDP. Domestic debts totaled GH¢161.5bn (39.4% of GDP), while external debt was GH¢161.5bn (39.4% of GDP).
• The Monetary Policy Committee upheld the policy rate at 13.5% following the decline in inflation from 10.3% to 7.5%. The MPC noted that the policy is extremely effective and expects to see a continuation in the decline of the inflation rate.
• Ghana announced plans to establish a National Vaccine Institute with the aim of producing vaccines domestically. The government has pledged to fund $25.0m into research and development. This is part of their goal to curb the spread of Covid-19 in the country.

Liberia 

• The Liberian Ministry of Commerce & Industry signed an agreement to fund Micro, Small and Medium Enterprises in the agricultural sector, education, youth MSMEs, as well as women-run MSMEs. The funds totaled $540,000 aims to improve livelihood and create new jobs across the country.

Francophone WA
Ivory Coast

• The Emerging Africa Infrastructure Fund (EAIF), a member of the Private Infrastructure Development Group (PIDG), has provided $34.0m to Ivory Coast for the construction of a 44.0MW hydroelectric power plant.
• S&P Global ratings has upgraded state-owned Cote d’Ivoire Energies to B+ from B-, with a stable outlook, hinged on the outlook for Ivory Coast. The agency expects subsidies to continue to boost revenue for the firm.

East Africa
Kenya

• Kenya and the United Kingdom government officials have inked deals worth Sh20.0bn that would be channeled through the private sector. The deals are set to unlock projects in housing, manufacturing and energy and setting up the Nairobi International Financial Centre in the country as a form of partnership with the City of London.
• U.S. firms have frozen investment plans in Kenya due to uncertainty about Biden’s review of a new free trade deal between the two countries.  Prior to now, many American firms had begun investing in Kenya spurred by the prospects of a fresh bilateral investment pact under the Donald Trump administration.
• Kenya has opened compensation talks with the Chinese firm whose contract to build the second terminal at the Jomo Kenyatta International Airport (JKIA) was cancelled amid fears a standoff could cost taxpayers hundreds of millions of shillings.
• The government of the UK will be offering 817,000 coronavirus vaccine doses to Kenya, as it rolls out a promised 100 million jabs for global distribution by next June.

Uganda

• The Covid-19 taskforce team for Kampala met on Monday and proposed stringent guidelines, which all those operating in the city must follow when the lockdown is lifted. The meeting was triggered by overwhelming pressure from the business community who want the government to loosen some of the lockdown restrictions. At the meeting, it was resolved that for the city centre to be opened, business owners and landlords must first commit to enforcing the Standard Operating Procedures (SOPs).

Tanzania

• The Bank of Tanzania (BOT) has injected $431.2m into its financial system for lending in the private sector to mitigate the macroeconomic impacts of the Covid-19 pandemic in the country.
• CRDB Bank Plc has signed a deal with the Tanzanian Business Community Association that seeks to hasten the pace at which goods are cleared and end challenges of delays in clearance of goods from the port.
• Tanzania has expressed its commitment to undertake a number of measures in an effort to boost export to the US under the African Growth and Opportunity Act (AGOA).

 
Rwanda

• Fitch Ratings has revised state-owned Development Bank of Rwanda’s (BRD) outlook to Negative from Stable and affirmed the bank’s long term Issuer Default Rating (IDR) at ‘B+’.

 
Southern Africa
South Africa

• South African payments and software platform, Yoco, has secured $83.0m in Series C funding, bringing the total funds raised to date by the startup to $107.0m. The company plans to deploy the funds to develop more tools that enable Small Micro and Medium Enterprises (SMMEs) to thrive in the digital economy.
• Yesterday, the National Treasury of South Africa presented a R36.2bn socio-economic relief package to boost activity after civil unrest earlier this month left destruction costing the economy nearly R50.0bn.
• The Finance Minister, Tito Mboweni, disclosed that South Africa’s R350.0 monthly temporary grant for unemployed people will cost the government R27.0bn for the next seven months.
• The U.S. has donated 5.7 million Covid-19 Pfizer vaccine shots to South Africa in its bid to help African countries fight against a third wave of the virus.

Angola

• The government of Angola announced an increase in the trade balance with Turkey, estimated at $500.0m. The initial agreement was at $178.0m which was less than desired as it did not show the real potential of the two countries, hence the need to boost investments.
• The Angola Investment Fund has opened the next round of its covid-19 forgivable loan program, having been refueled with the sum of $350,000 from its government.

Namibia

• The Africa Centre for Disease Control and Prevention has provided over N$3.0m consisting of specialized labour aid and medical supplies in response to the rise in Covid-19 cases in Namibia. The country currently has 20,890 active cases.

Zambia

• The Zambian Kwacha appreciated against the dollar from around K22.5 to K19.3 boosting confidence in the local economy, citing shifting economic fundamentals.
• Zambian inflation was unchanged in July as food price growth that propelled the headline number over 20.0% this year remained steady.

Zimbabwe

• The government of Zimbabwe says it will viciously crackdown on businesses that may take advantage of the turmoil in neighbouring South Africa to “sabotage the economy” by hiking prices of goods. Fears of shortages due to the affected supply chain have left many businesses in Zimbabwe with prospects of hiking prices.
• Zimbabwe has opened its, boards, to vaccinated tourists. This follows the reopening of the Victoria fall and Kazungula border posts, in order to kick start the tourism sector after the drastic effects from covid-19.

Central Africa
Cameroon

• Financing firm Alios Finance Cameroon recently launched a bond issuance operation on the Central African Stock Exchange (BVMAC). The firm is aiming to raise XAF10.0bn backed by a 5.4% interest rate.

Gabon

• In the past week, the IMF approved a $553.2m three-year Extended Fund Facility for Gabon.
• The Approval allows for immediate disbursement of $115.3m for budget support.

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