July 15, 2022/United Capital Research

Anglophone West Africa

Nigeria

• The Federal Government disclosed ongoing engagement with oil marketers on issues bordering on Premium Motor (PMS) cost, fuel queues, and bridging claims payment, among others, in the downstream oil sector.
• Also, it was reliably gathered in Abuja that the meeting might lead to an upward adjustment in the pump price of petrol, as oil marketers had repeatedly blamed the persistent fuel queues in various parts of Nigeria on the unsustainable cost of PMS.
• Representatives and Leaders of the Artisan Fishermen Association of Nigeria (ARFAN) from the five Niger Delta states, who are victims of the Shell Bonga oil spill, called on the President Muhammadu Buhari to prevail on multi-national oil giants in the region to put an end to the environmental degradation and pollution in the Niger Delta.
• According to the Federal Government, an additional capacity of 3,863MW of electricity will be made available to boost the power supply to customers across the country in the next 24 months.
• The Central Bank of Nigeria conducted an NT-bills Primary Auction within the week a N143.3bn rollover. There was decent investor demand with subscriptions amounting to N145.5bn. Surprisingly the apex bank allotted only N103.6bn worth of papers and chose to supplement the outstanding offer of N39.7bn with bridge finance. The stop rates increased across all tenors rising by 35bps, 21bps and 93bps respectively for the 91-day, 182-day and 364-day papers.

Ghana

• To reduce unemployment in the region, Mr Stephen Yakubu, the Upper East Regional Minister, announced that the Federal Government had committed one billion to invigorate the Technical and Vocational Education and Training.
• The Technical Advisor of the Ghana Tourism Development Project (GTDP) disclosed that 60.0% of the $10.0mn World bank tourism grant is allocated to women in the sector.
• Cote d’Ivoire and Ghana Cocoa Initiative (CIGCI), aimed at achieving a target price of $2,600 per tonne to fight the poverty of Cocoa farmers, has fostered an agreement with major institutional buyers of cocoa. The buyers agreed to pay a premium termed “living Income Differential” of $400 a tonne on all Cocoa contracts sold by Cote d’Ivoire or Ghana

Francophone West Africa

Ivory Coast

• The African Development Bank just recently approved, on Jul 13 2022, a $400,000 technical assistance grant to the Deposit and Consignment Office of Cote d’Ivoire, aimed toward building the financial capacity of the Indigenous people of Ivory Coast.
• According to the country’s Prime Minister, Patrick Achi, more than 2,000 traders were sanctioned over contempt of basic commodity prices to fight inflation. In further context, the sanctioned parties paid c.87.0mn CFA francs in fines.
• According to the Mitsibishi UFJ Financial Group Inc., Ivory Coast plans to raise more than $300.0mn in loans to build hospitals across the nation.
• According to the International Monetary Fund (IMF), the economic growth of the Ivory Coast will slow down to 6.0% in FY-2022, versus the initial forecast of 7.0% expansion.
• According to data from the country’s exporters’ association, GEPEX, Ivory Coast’s cocoa grind climbed 57.1% y/y in June to 55,000 tonnes. In further context, the group processed 156,723 tonnes of cocoa across April, May, and June (Q2-2022), vs 109,471 tonnes processed in the same period a year earlier.

Senegal

• The National Agency of Statistics and Demography, Senegal, recently released the country’s June CPI Inflation numbers. Data extracted revealed a 1.5% climb in Senegal’s Inflation print, from 7.4% y/y in May-2022 to 8.9% y/y in Jun-2022.
• According to Bloomberg, a total of €121.0mn in loans was disbursed to Senegal by the African Development Bank to help implement an emergency agricultural program.
• The fund is aimed at helping 850,000 small-scale farmers grow a targeted 38.0mn tonne of additional wheat, corn, rice, soybeans, and other crops over the next two years.
• In further context, the loan is the first approved under the bank’s $1.5bn African Emergency Food Production Facility, which seeks to avert a looming food crisis exacerbated by the war in Ukraine.

East Africa

Kenya

• The Central Bank of Kenya welcomed the admission of the Democratic Republic of Congo (DRC) into the East African Community (EAC). The impact of the admission will lead to an expansion of the Eastern market size and offers a path for trade, cultural integration and new investment for employment opportunities.
• The International Monetary Finance (IMF) revealed that Kenya had requested certain waivers on the $2.3bn (Sh257.0bn) loan programme. This is due to the country’s failure to meet some of the conditions set in Apr-2021 when the loan was approved.
• According to the Registrar of Companies, new company and business registration dipped by 16% to 128,800 from 154,155 in the previous quarter, as Kenyans, who had lost their job due to the Covid 19 pandemic, returned to work.
• Kenya’s Ministry of Health administered 19.0mn Covid-19 vaccine doses this week as the country work to vaccinate a targeted population of 27.2mn. The vaccination drive is due to the rise in Covid-19 cases in Jun-22. So far, the number of fully vaccinated people in Kenya is 9.0mn.

Rwanda

• According to the Minister of Trade and Industry, Rwanda plans to increase its trade surplus by exploring more opportunities with the Economic Community of Central African States (ECCAS).
• The Rwandan government has disclosed its intention to invest over $1.0mn in Kigali’s Stormwater Management Master Plan. The plan aims to develop centralized drainage systems by 2024 to help mitigate floods in the city.

Tanzania

• According to the National Bureau of Statistics Tanzania, the headline inflation rate for June rose by 40bps to 4.4% y/y compared to 4.0% y/y in May-2022. Increases in Transport, Food & non-alcoholic beverages, Housing and other household equipment drove prices upwards.
• In addition, food inflation rose to 5.9% from 5.5% in May-2022. Similarly, core inflation increased to 3.4% from 3.0% in May-2022.
• In collaboration with Zambia, the Tanzania government plans to build a new diesel pipeline connecting the port of Dar es Salaam, the country’s commercial capital, with the copper mining town of Solwezi in Zambia. This is aimed to improve the transportation of refined fuel between the two countries.
  

Uganda

• Uganda National Oil Cooperation (UNOC) has ordered 8.0mn litres of fuel to boost the local industry’s stock ahead of Kenya’s election scheduled for Aug 9. Noteworthily, the county had suffered supply shortages after Kenya’s post-election violence in 2007, as the county is heavily dependent on Kenya for fuel imports.
• Financing plans for Uganda’s 4.0bn crude export pipeline will start in Q4-2022. The export pipeline, with a daily expected capacity of 216,000bbl, will move land-locked Uganda’s oil to the international markets when production begins in 2025.

Southern Africa

Angola

• According to the Instituto Nacional de Estatistica, Angola’s National Consumer Prices rose 23.0% y/y in June-22 from 24.4% y/y in May-22. Luanda CPI rose 23.3% y/y in June-22 versus 25.1% in May-22.
• Angola took part in Thursday’s 41^st Ordinary Session of the Executive Council of the African Union (AU) in Lusaka, Zambia. The meeting will assess the inter-Regional Economic Communities (REC) cooperation, the Tripartite Free Trade Area (TFTA) between the Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC) and Southern African Development Community.
• The administration of the Luanda Collective and Urban Transport operator (TCUL) announced that the company had achieved economic and financial stability despite Kz 3.0bn in liabilities. The State is the majority shareholder of the 34-year-old company. The Board Chairman stated that the company has fully repaid its Kz 700.0mn debt with the National Social Security Institute (INSS) and is set to settle its Kz 3.0bn debt from 2022-24 as part of its restructuring plan.

South Africa

• The BankservAfrica Economic Transactions Index (BETI), which tracks interbank payments, climbed 3.9% q/q, beating forecasts. The index has a strong correlation to the gross domestic product. The measure signals economic momentum may be more robust than projected.
• South Africa’s Employment and Labor minister has stated his opposition to privatising the power utility Eskom Holdings SOC Ltd. The company currently struggles to repay its $23.0bn debt. The government guarantees up to ZAR 350.0bn of its debt. Operational issues have led the company to cut 6,000.0 MW from the grid since June 2022 intermittently.
• According to Statistics South Africa, Mining production fell 7.8% y/y in May from a revised 14.8% y/y fall in April. Mining output rose 0.7% m/m versus revised 3.6% m/m decline in April.

Zimbabwe

• Zimbabwe’s Electricity Supply Authority (ZESA) is set for more power cuts from 13-July despite a surge in demand during the current winter months and constraints in electricity imports. The utility currently produces 1,219.0 MW of electricity against the national demand of 2,200.0 MW. Zimbabwe relies on power imports from South Africa and Mozambique.
• State-owned Fidelity Printers and Refiners disclosed that Zimbabwe’s H1-2022 gold-export earnings jumped to $1.047bn from $464.2bn in H1-2021, driven by higher international prices and increased output by mining companies. The country is expected to produce 35.0 tons of gold by the end of the year. Last year, Zimbabwe produced 29.6 tons of gold.
• The Energy Regulatory Authority stated with immediate effect a 2.7% gasoline price increase to Z$677.32/ltr. from Z$659.80/ltr. Diesel price increases 2.2% to Z$714.91/ltr. from Z$699.62/ltr.,
• Finance minister Mthuli briefed that the country will withdraw the operating licenses of retailers that charge solely in U.S. Dollars, a move to protect the local currency as inflation rose to 192% last month.
• Zimbabwe’s Central Bank has approved an Exchange Control Order that permits the country’s power utility to bill exporters and partial exports at the international cross rate. The order will cease to have effect six (6) months after publication unless renewed for exporters and partial exporters who are residents of Zimbabwe.
• African Development Bank President Akinwumi Adesina is in Zimbabwe to meet with President Emmerson Mnangagwa, the Finance and Economic Development and other officials following an agreement earlier in the year to help the country negotiate debt resolutions with international financial institutions and bilateral creditors. Meetings with the country’s creditors are to follow.

Zambia

• Zambia’s Energy Minister disclosed that the country and Tanzania are in the final planning stages for constructing a new diesel pipeline connecting the port of Dar es Salaam with the copper mining town Solwezi in Zambia to mitigate surging fuel costs.
• Zambia also plans on reconfiguring the existing pipeline from Dar es Salaam to Ndola in Zambia’s Copperbelt province to transport refined oil, substitute to the current combination of crude and other fuel.
• The G20’s finance ministers and central bank governors in Bali are moving toward backing the formation of a Zambian creditor’s committee under its program to coordinate the restructuring of struggling debtor nation’s loans. 
  

Central Africa

Cameroon

• According to Cameroon’s Finance Minister, Louis Paul Motaze, the country’s Gross Domestic Product estimate for FY-2022 has been revised to 4.0% from 4.2% due to a worsening global economic outlook and a drop in the country’s oil sector activity.