August 23, 2024/United Capital Research

Anglophone West Africa
Nigeria

• Nigeria owes NNPC $4.9bn fuel debt

The Federal Government owes the Nigerian National Petroleum Company Limited (NNPCL) almost half of what it plans to collect in revenues this year for the petrol subsidy it reintroduced in August last year. NNPCL is owed N7.8tn ($4.9bn) by the government in subsidy debts for the seven months to July, the government aims to collect N19.4tn in revenue this year.
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• FG eyes $500m W’Bank loan to boost education, health sectors

The Federal Government is targeting a $500.0m loan from the World Bank to tackle inadequate human resource issues in the country’s education and healthcare systems. The proposed loan, part of the Nigeria Human Capital Opportunities for Prosperity and Equity Governance Programme, is intended to tackle long-standing staffing gaps and enhance the performance management of basic education teachers and primary healthcare workers.
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• MTN, others get permits to generate electricity

The Nigerian Electricity Regulatory Commission (NERC) has issued permits to Golden Penny Power Limited, MTN Communications Nigeria Limited, Havenhill Synergy, and others for mini-grid electricity generation. In the first quarter of 2024 NERC issued 9 new off-grid generation licenses with a gross capacity of 109.69 megawatts.
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• Togo, Benin owe Nigeria $14m for electricity

The Nigerian Electricity Regulatory Commission revealed that none of the four international bilateral customers being supplied by the power generation companies in the Nigerian electricity supply industry made payment against the cumulative invoice of $14.19mn issued by the market operator for services rendered in the first quarter of 2024. The foreign companies are Para-SBEE in Benin Republic ($3.15mn), Transcorp-SBEE in Benin ($4.46mn), Mainstream-NIGELEC in Togo ($1.21mn), and Odukpani-CEET in Togo ($5.36mn).
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• CBN posts highest remittance inflow of $553m in July

The Central Bank of Nigeria (CBN) has announced a significant increase in remittance inflows, reaching $553mn in July 2024. This is a 130.0% increase from the corresponding period in 2023. This figure represents the highest monthly total inflows on record and reflects ongoing efforts by CBN to enhance liquidity in Nigeria’s foreign exchange market.
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Ghana

• Govt misses T-Bills target for sixth consecutive time

For the sixth consecutive time, the government has fallen short of its treasury bills target, recording an undersubscription of approximately 6.91% in the latest auction. According to the latest data from the Bank of Ghana, investor interest in treasury bills remains slightly low. The recent auction saw bids totaling GH¢4.6 billion, falling short of the GH¢4.9 billion targets.
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• Ghana seeks $500m loan from Cocoa Traders amid delays in traditional financing

Ghana is actively pursuing a $500 million loan from major cocoa traders to support its cocoa industry, as delays in securing its usual financing arrangements continue to pose challenges. This $500 million loan is intended as a temporary measure while COCOBOD struggles to finalize its annual syndicated loan, a process currently delayed by concerns over crop yields.
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• Ghana Cocobod will not raise syndicated loan for 2024/25 season

Ghana Cocobod says it will not raise cocoa syndicated loan for beans purchases in the 2024/25 season, which is expected to open on September 1. The board also lowered its target for the season to 650,000 tonnes from 810,000 tonnes.
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Francophone West Africa
Senegal

• Senegal Consumer Prices Drop for 1st Time Since 2019

Consumer prices in Senegal fell 0.7% year-on-year in July 2024, reversing from a 1.3% rise in the previous month. It was the first decline in consumer prices since February 2019, with food prices decreasing for the first time in seven months (-2.0% vs 1.4% in June) while housing & utilities dropped faster (-0.8% vs -03%). Simultaneously, prices moderated for communications (0.1% vs 1.7%) and transport (1.0% vs 1.1%). By contrast, prices accelerated for furnishings & household equipment (2.3% vs 2.2%), restaurants & hotels (3.1% vs 2.9%). miscellaneous goods & services (3.3% vs 3.0%), and clothing (1.3% vs 0.8%) while rebounding for recreation & culture (0.2% vs -0.2%). On a monthly basis, consumer prices edged up by 0.1%, following a 0.3%rise in June.
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• Senegal sets up commission to review oil and gas contracts

Senegal has set up a commission of legal, tax, and energy sector experts to review its oil and gas contracts and work to rebalance them in the national interest. President Bassirou Diomaye Faye, who defeated the ruling coalition candidate in a landslide victory in March, ordered an audit of the oil, gas and mining sectors after coming into office and vowed to renegotiate the terms of contracts with foreign operators in the country if needed.
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Niger

• Niger resumes oil exports via Benin after suspension

Landlocked Niger has resumed crude oil exports via Benin after a dispute between the countries halted the flow of oil through a new Chinese-funded pipeline to the West African coast, according to a pipeline company agent and ship tracking data on Wednesday. The dispute was over Niger’s refusal to lift a ban on imported goods from Benin, leading its coastal neighbour to block exports through the PetroChina-backed pipeline in May. In June, Niger shut off the flow of oil through the pipeline.
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East Africa
Kenya

• Kenya Government Plans To Reinstate Some Taxes To Raise $1.2 Bn

The Kenyan government plans to raise about $1.2 billion by reinstating some unpopular taxes contained in a finance bill that was scrapped in the face of deadly street protests, a government minister said.
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• EU Invests Ksh3.6 Billion to Finance Business Development In Kenya

The European Union (EU) has committed Ksh3.6 billion (€25 million) to boost business development in Kenya, an investment aimed at enhancing economic collaboration between Kenya and the EU.
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• KCB Group PLC Profit After Tax Rises 86% to Ksh 29.9B, Resumes Dividend Payout

KCB Group PLC’s profit after tax for the first half of the year ending June rose 86% to Ksh29.9 billion, as the Group sustained a focus on supporting customers and economic recovery efforts.
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• List of Most Profitable and Loss-Making Microfinance Banks in Kenya

The Central Bank of Kenya’s 2023 bank supervision report revealed that the microfinance sector experienced an 8.8% decline in total assets, dropping from KSh 70.4 billion in 2022 to KSh 64.2 billion in 2023 The microfinance banks in Kenya reported a combined loss before tax of KSh 2.4 billion in 2023, a significant increase from the KSh 980 million loss recorded in 2022.
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Uganda

• Uganda’s push to become an oil producing nation continues to gain momentum

Uganda’s ambition to become an oil-producing nation continues to gain ground as the country recently drilled 74 oil wells. 7 other oil wells are near completion as Uganda prepares to start producing oil in 2025. Additionally, the taxation of oil and oil associated goods have begun picking up steam.
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Tanzania

• Tanzania’s current account deficit shrinks by 49.5pc

Tanzania’s current account deficit sharply decreased by nearly half, falling to US$2.5 billion in the year ending June 2024, down from US$4.96 billion recorded during the same period in 2023, making it the lowest deficit recorded since July 2023.
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• US invests 21.6bn/- to boost Tanzania firms

The US government, through its agency for international development (USAID), has invested 8.3 million US dollars (equivalent to 21.6bn/-) in several Tanzanian firms to boost trade, improve food security and strengthen Tanzania’s competitiveness in the export arena through the African Growth and Opportunity Act (AGOA).
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• Tanzania Investment Centre registers 409 investment projects, eyes $8.5 billion in 2024

Data from TIC shows that the leading sector in attracting capital through investment projects between January and June 2024 was manufacturing, which registered 196 projects worth $1.42 billion.
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• Financial, insurance register highest growth in Q1

The financial and insurance services have registered highest growth of 17.1 per cent in this year’s quarter one signals a transformative period for the industry. National Bureau of Statistics (NBS) latest quarterly GDP report shows that the financial and insurance services was followed by information and communication 13.4 per cent, transport and storage 7.6 per cent and electricity 7.6 per cent.
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South Africa
South Africa

• Looming interest rates cut due to lower inflation a boost for economic activity

Consumer activity in South Africa is expected to ramp up significantly in the final three months of this year on the back of the central bank easing the cost of borrowing as the rate of inflation comes down much faster than expected.
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• South Africa’s Inflation Rate Drops to Lowest Level in Three Years

South Africa’s consumer inflation drops to 4.6% year-on-year in July, nearing the South African Reserve Bank’s target range. Inflation hits its lowest level since July 2021, despite a slight increase on a month-on-month basis. The South African Reserve Bank maintains its main policy rate at 8.25% for over a year amidst economic price pressures. South Africa’s headline consumer inflation dropped to 4.6% year-on-year in July, down from 5.1% in June, according to data released by the statistics agency on Wednesday. This brings inflation to its lowest level since July 2021 and closer to the South African Reserve Bank’s (SARB) target, which aims for a midpoint of 4.5% within a 3% to 6% range.
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• Gold miners rally as gold continues its run, but SA is behind the curve

South African gold miners are benefiting as gold continues its historic run on the increasing chance of an interest rate cut in the US, with the spot price hitting $2 529 (R45 177) an ounce yesterday – pushing the value of a gold bar to $1 million.
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• South African Corn-Export Forecast Raised in Boon for Neighbors

South Africa’s Agricultural Business Chamber raised its forecast for the country’s corn exports as local consumers use more low-cost grain imported from South America and free up tonnage for drought-hit neighbors.  The country will likely export 1.85 million tons of corn in the 12-month marketing season to the end of April, Wandile Sihlobo, chief economist at the chamber known as Agbiz, said Tuesday in a note sent to Bloomberg. While that’s up 28% from its June forecast of 1.44 million tons, it would still be the least in five years as South Africa’s own crop plunged by a fifth.
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Angola

• Angola Weighs Environmental Bond with The Nature Conservancy

Angola is considering a proposal from The Nature Conservancy for an environmental bond project that would reduce its debt burden. Modeled after a similar initiative in Gabon, a so- called debt-for-nature swap has been under consideration but has not yet been formally accepted by Angola’s government, according to a spokesperson for the Ministry of Environment.
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• Angola May Delay Paying Wages Due to Debt Repayments

Angola warned that it may delay paying state workers’ wages for a second consecutive month due to a funding gap caused by mismatched revenue collection and expenditure, Angop reported, citing Finance Minister Vera Daves de Sousa. The southwest African nation’s financial situation is strained by ongoing “debt pressures” that are higher in some months, limiting its ability to build a financial safety net, De Sousa said. Most of the country’s revenue is used to service debt, with payments “automatically” debited from state accounts as soon as funds are received, and little is left to meet other obligations, she said.
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Zambia

• Sweden and Zambia to Work on Cross-Border Carbon Offset Projects

Sweden and Zambia signed an MoU to cooperate on emissions trading under the Paris Agreement, the Swedish Energy Agency said in a statement dated Aug. 20.  The two countries will sign a binding agreement after discussing how they can regulate transactions of internationally transferable mitigation outcomes.
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• Zambia to Raise Rolling Blackouts to 17 Hours Daily From Sept. 1

Zambia to increase duration of daily power cuts from current 12 to 14 hours daily for domestic consumers, Energy Minister Makozo Chikote says. The government is consulting on electricity-tariff adjustments during the drought to meet cost of imported power, he says in televised address on state-owned ZNBC TV.
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Zimbabwe

• United States offers help to Zimbabwe

The United States has expressed a strong interest in enhancing the investment climate in Zimbabwe to boost economic opportunities. In a recent statement, US Ambassador Pamela Tremont reaffirmed her country’s ongoing support for Zimbabwe’s development, highlighting that the US has contributed US$5 billion in humanitarian, health, and development assistance since Zimbabwe’s independence, with over US$1 billion provided in the last three years alone.
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• Zimbabwe Sees Economic Growth Rate More Than Doubling in 2025

Zimbabwe’s economic growth rate will more than double next year as the country recovers from a devastating drought and benefits from rising manufacturing activity, according to government estimates.  Gross domestic product will probably expand 6.5% in 2025, from an estimate of 2% this year, the Ministry of Finance, Economic Development and Investment Promotion said in a policy paper.
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• Zimbabwe Bans Riverbed Mining to Protect Water Sources

Zimbabwe has banned riverbed alluvial mining with immediate effect to protect the environment, a move that could impact many of the country’s gold miners. Agriculture Minister Anxious Masuka made the announcement after a cabinet meeting on Tuesday, adding that enforcement measures will be put in place to ensure compliance.
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• Zimbabweans Use Gold-Backed ZiG to Pay for 40% of Transactions

Zimbabweans are using the nation’s gold- backed currency for 40% of payments compared with 20% when it first started in April, Finance Permanent Secretary George Guvamatanga said. The ZiG — an abbreviation for Zimbabwe Gold — is only circulating in electronic form, Guvamatanga told a meeting of economists Wednesday in the capital, Harare.
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Central Africa
Cameroon

• Cameroon’s Inflation Hits 3.9% in July 2024, Exceeding 3% Tolerance Threshold

In July 2024, Cameroon’s inflation rate reached 3.9%, marking a 0.1% increase year-over-year and averaging 5.4% over the past 12 months, according to the National Institute of Statistics (INS). This rate continues to exceed the 3% threshold set by the Cemac for multilateral surveillance. The INS reports that inflationary pressures during this period were driven by rising food prices and transportation costs. Over the last year, food prices in Cameroon have increased by an average of 7%, while transportation costs have surged by 14.4%.
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• Cameroon’s Export Revenue to the EU Falls by 22% in 2023

In 2023, Cameroon’s export revenue to the European Union (EU) totaled CFA1,524.6 billion, down from CFA1,964.4 billion in 2022. This represents a 22.4% decline year-over-year, reversing a trend of increasing export revenue to the EU since 2020. The decrease is primarily due to a 33.3% drop in revenue from hydrocarbon sales. On the other hand, Cameroon’s imports from the EU have increased during the same period. The value of goods imported from the EU rose to CFA1,323 billion in 2023, up from CFA1,267 billion in 2022, marking a 4.4% year-over-year increase.
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• Cameroon Uncovers Over $1 Billion in Unpaid Domestic Debts After Four-Year Audit

The Cameroonian government has acknowledged domestic debt arrears totaling CFA671.7 billion ($1.1 billion), owed by various ministries, public institutions, and decentralized local authorities. These arrears, claimed by various entities and service providers for the period from 2000 to 2019, were revealed through a comprehensive audit initiated by the Ministry of Finance in late 2020.
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• Cameroon Anticipates Food Production Surge by September 2024 Despite Fertilizer Costs

Cameroon’s food production is expected to see an uptick in the third quarter of 2024, according to a recent forecast from the Bank of Central African States (Beac). This positive outlook is driven by the intensified agricultural activities during this period, which aligns with the beginning of the harvest season and the gathering of early crops. However, the Beac report, which covers the six countries within the Central African Economic and Monetary Community (CEMAC) also notes that this growth in food production could be hindered by the scarcity and rising costs of fertilizers.
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Democratic Republic of Congo

• Congo to Build First Deep-sea Port with UK-DP World Partnership

The Democratic Republic of Congo (DRC) is set to break ground on its first deep-sea port thanks to a partnership between the Emirati logistics company DP World and British International Investment Plc (BII). The project will be located at the Port of Banana where the Congo River meets the Atlantic Ocean. The new port will expand DP World’s presence in Africa. BII plans to invest $35 million in the project, which it estimates will reduce trade costs in the DRC by 12% and create 85,000 jobs.
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