United Capital Weekly Pan African Monitor Friday 11-October-2024

Image Credit: United Capital Research

October 11, 2024/United Capital Research 

Anglophone West Africa (WAEMU)

Nigeria

  • Nigeria’s debt servicing payments rise by 69% to N6.04 trillion in H1 2024

Nigeria’s debt servicing payments have surged by 69.00% in the first half of 2024, reaching N6.04tn, up from N3.58tn recorded in the same period of 2023. According to the Central Bank of Nigeria (CBN), debt service in H1-2024 made up 50.00% of the total expenditure of N12.17tn and a staggering 162.00% of the N3.73tn total revenue generated during the period.

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  • Three FG agencies spend N533bn on revenue collection

Three major revenue-generating agencies in Nigeria deducted a total of N533.11bn as costs of revenue collection in the first seven months of 2024, this marks a substantial increase of 99.85% compared to the N266.75bn recorded in the corresponding period of 2023. The agencies include the Nigeria Customs Service, Federal Inland Revenue Service (FIRS), and Nigerian Upstream Petroleum Regulatory Commission (NUPRC).

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  • Tinubu govt borrowed $6.45bn from W’Bank

The Federal Government, under the leadership of President Bola Tinubu, has secured loans worth $6.45bn from the World Bank in just 16 months. The amount increased to the new figure following the recent approval of three new loans totalling $1.57bn from the World Bank for various projects in Nigeria. Notably, the international lender has approved no fewer than 36 loan requests to the Federal Government, amounting to a substantial total of $24.088bn within five years.

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  • FG targets 2.3 million barrels per day oil production by 2025

The federal government has set a new target to increase daily crude oil production to 2.30 million barrels per day (mbpd) by mid-2025. Mohammad Badaru Abubakar, the Minister of Defence, noted that oil production has risen from 1.40mbpd to 1.60-1.70mbpd, due to the military’s efforts in combating crude oil theft in the Niger Delta region.

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Ghana

  • Food inflation threatens end year target

Ghana’s inflation increased for the first time in six months, with the rate increasing from 20.40% in August to 21.50% in September. This was largely driven by food inflation which rose by three percentage points from 19.10% to 22.10%. The surge in food costs was attributed to price hikes in staple items such as cereals, vegetables and other essential food products.

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  • Non-traditional exports hit $3.9bn

The Chief Executive Officer (CEO) of the GEPA, Osafohene Dr Afua Asabea Asare, who disclosed this at the Minister’s Press Briefing in Accra, said the NTEs earned the country $3.94bn during this period, a rise from the $3.53bn posted in 2022. The GEPA CEO explained that the growth was led by products such as iron and steel circles, rods and billets, which topped the earnings list with $447.80mn. Other high-performing products included cocoa paste ($340.6 million), cashew nuts ($263.50mn) and cocoa butter ($241.30mn).

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  • T-Bills: Govt misses target again by GHC2.30bn

Waning demand for treasury bills continues to be evident, as the latest data from the Bank of Ghana reveals that the government has once again missed its target by a considerable GH¢2.31bn. In the most recent auction, the government accepted all bids totalling GH¢3.67bn for its short-term instruments, falling short of a target set at GH¢5.98bn. Per the latest auction results, this resulted in an undersubscription of approximately 38.50% in the sale of these short-term instruments.

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Francophone West Africa

Burkina Faso

  • Fortuna Mining Assures Burkina Faso Will Not Revoke its Mining Permits

During a radio interview on Oct. 5, 2024, among other topics, President Traoré mentioned the possibility of the government revoking certain mining permits for companies that are not operating per the laws of Burkina Faso. No details were, however, provided. This statement raised concerns among the companies operating in the country and their investors.

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  • Kiniero on Track for First Gold in Q4 2025

West African gold producer and developer Robex Resources Inc (“Robex” or the “Company”) is pleased to provide a project development update for Kiniero Gold Project in Guinea. The project is on track for first gold in Q4 2025.

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 Ivory Coast

  • IMF Reaches Staff Level Agreement on the Third Review of the EFF/ECF Arrangements and Second Review of the RSF Arrangement and Concludes the 2024 Article IV Consultation with Cote d’Ivoire

IMF staff and The Ivorian authorities have reached a staff-level agreement on both the third review of Côte d’Ivoire’s economic reform program supported by the EFF and ECF arrangements, and the second review of their climate change reform program supported by the RSF arrangement. Discussions were also held in the context of the 2024 Article IV consultation.

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  • Ivory Coast eyes further Asian expertise to expand cocoa processing

Ivory Coast could sell a further stake in its Transcao cocoa processor to Malaysian cocoa group Guan Chong Berhad (GCB), the industry’s regulator told Reuters, as it pushes for more expertise and investment to grow the sector. On Wednesday, GCB said its Singaporean subsidiary had agreed to acquire a 25% stake in Transcao from Ivory Coast’s Coffee and Cocoa Council (CCC).

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 Senegal

  • Russian Company KamAZ Opens Production Plant in Senegal for Trucks and MRAPs.

The upcoming launch of a KamAZ production plant in Senegal marks a significant milestone in economic cooperation between Senegal and Russia. The announcement was made during a press conference in Moscow, where Senegalese Foreign Minister Yassine Fall confirmed the development alongside Russian Foreign Minister Sergey Lavrov.

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East Africa

Kenya

  • Kenya central bank cuts main lending rate to boost private sector credit

Kenya’s central bank slashed its benchmark lending rate to 12.00% from 12.75% in a move aimed at stimulating credit to the private sector, the bank’s monetary policy committee (MPC) said in a statement. The cut follows a 25 basis-point reduction in August, the first in approximately four years. The bank also trimmed its economic growth forecast for 2024, citing a slowdown in the second quarter.

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  • Central bank cuts 2024 growth prospects to 5.10pc

The Central Bank of Kenya has cut its economic growth forecast to 5.10 percent, down from 5.40 percent, citing slower growth in the second quarter on diverse factors including suppressed credit flows. The country registered a slower 4.60 percent Gross Domestic Product (GDP) growth in the second quarter compared to 5.60 percent at the same time last year.

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  • Kenya expects more IMF funding by year-end

Kenya expects more money from the International Monetary Fund by the end of the year and is in talks with the Fund about combining the seventh and eighth reviews of its support programme, its central bank governor said. The East African country and the IMF reached a staff-level agreement on the seventh review of its $3.60 billion programme in early June. But the review is yet to be approved by the Fund’s executive board after the government was forced to scrap proposed tax hikes and draw up spending cuts in late June in response to mass protests that turned deadly.

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  • Foreign inflows in Kenya double in 12 months

Foreigners’ portfolio investments in Kenya more than doubled in the 12 months to June this year, reflecting an improving investor sentiment about the country. As of June, such investments hit Sh6.40 billion ($49.50 million), a 121 percent rise from the negative value of Sh32.60 billion ($233.40 million) in June last year, the latest data from the Central Bank of Kenya (CBK) shows.

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  • Kenya’s senate to consider impeachment of deputy president

Kenya’s senate will next week debate whether to dismiss Deputy President Rigathi Gachagua, the senate speaker said after the national assembly voted to impeach Gachagua. Lawmakers voted 281 to 44, far more than the two-thirds majority needed to carry the motion to the Senate.

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  • CBK forex haul up Sh108.00bn in five weeks on dollar purchases

The Central Bank of Kenya (CBK) has grown its official forex reserves by $837.00 (Sh108.10 billion) in the last five weeks after buying dollars from the market, taking advantage of a higher supply of the greenback from remittance and agriculture exports. The action was taken to prevent volatility in the foreign exchange market.

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Rwanda

  • Foreign direct investment into Rwanda up 63.00% in first half of 2024

Foreign direct investment (FDI) inflows into Rwanda rose by 63.50 percent to $289.00 million in the first six months of 2024, from $177.00 million recorded in the same period of 2023, according to a recent report by the National Bank of Rwanda (BNR). Industry actors who spoke to The New Times described the performance as significant and a testament to Rwanda’s efforts to provide a conducive environment for investors. The Monetary Policy and Financial Stability Statement of September 2024 pointed out that the performance reflects an improving business landscape fueled by robust domestic economic activity.

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Tanzania

  • Tanzania central bank holds lending rate at 6.00%

Tanzania’s central bank held its key interest rate, unchanged at 6.00%. In the two quarters to September, the central bank held the benchmark rate at 6.00%, from 5.50%, which was announced in January when the bank introduced the rate. The bank targets inflation of 5.00%, but consumer inflation has stayed comfortably below that figure despite growing pressure on the shilling. Inflation increased to 3.10% year-on-year in August from 3.00% the previous month, data from the statistics office showed.

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  • Tanzania inflation rate steady at 3.10%

The annual inflation rate in Tanzania stood at 3.10% in September 2024, unchanged from the previous month. Upward pressure came mostly from prices of housing & utilities, miscellaneous goods & services, and transportation. Meanwhile, there was a slight slowdown in prices of food & non-alcoholic beverages. On a monthly basis, consumer prices rose by 0.10% in September, after a 0.20% fall in the prior month.

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  • National debt stock down 1.40 percent

The national debt stock decreased by 1.40 percent in July, reaching 41.80 billion US dollars, driven primarily by a reduction in external debt, according to the Bank of Tanzania’s (BoT) latest monthly economic review. The external debt accounted for 70.90 percent of the total national debt, with the stock valued at 29.60 billion US dollars marking a 1.90 percent decline from the previous month. According to the Bank report, the decrease was primarily attributed to a reduction in private sector external debt. The external loans disbursed in July amounted to 87.00 million US dollars primarily to the central government.

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Uganda

  • Uganda central bank trims key lending rate again

Uganda’s central bank trimmed its key lending rate by 25 basis points for the second time in a row, lowering it to 9.75%, saying that inflation was expected to remain below its target in the near term. Inflation eased to 3.00% year-on-year in September, below the central bank’s 5.00% medium-term target. The MPC assesses that inflation is expected to remain below the target in the near term and that the risks to inflation are balanced but acknowledges the inherent uncertainty in the outlook, which warrants a cautious monetary policy.

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  • Ugandan economy shows resilience as PMI holds above 50.00

The Stanbic Bank Purchasing Index (PMI) for September dropped slightly to 54.20 from 56.30 in August but remains above the 50.00 threshold, indicating a positive business outlook. Effective advertising played a significant role in sustaining strong business output and attracting new clients. Strong business output and new order growth were linked to robust client demand, reinforced by effective advertising. Firms foresee healthy client demand conditions over the coming year, with plans to increase investment in advertising and new products.

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  • Govt plans to cut next budget by Shs14.00 trillion

The government has put the 2025/26 budget projections at Shs57.40 trillion, which is Shs14.70 trillion lower than the current budget. In May, the government revised the Shs58.00 trillion budget for the 2024/25 financial year to Shs72.10 trillion, marking a significant increase of Shs14.10 trillion, a few hours before it was presented and approved by Parliament. The House had earlier received an addendum from the Ministry of Finance, which increased the 2024/25 budget by more than 25 percent to Shs72.10 trillion.

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Southern Africa

Angola

  • Angola’s GDP Grows in the First Half of This Year

Angola’s Gross Domestic Product (GDP) recorded an estimated growth of 4.6% and 4.1% in the first and second quarters of this year, according to the Report on the Implementation of the National Development Plan 2023-2027, for the first half of 2024, assessed by the Council of Ministers.

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South Africa

  • South Africa introduces major visa reforms to attract skilled workers

Minister of Home Affairs Leon Schreiber announced important changes to South Africa’s visa system. The new Remote Work Visitor Visa and a Points-Based System for Work Visas are designed to simplify processes and attract foreign workers and investors.

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  • FirstRand Turns More Bullish on South Africa’s Economy

FirstRand Ltd. has turned more bullish on South Africa’s economy, and now sees a greater chance of economic growth accelerating to 2% and the rand strengthening to below 16 per dollar next year.

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  • Private sector growth strengthens in South Africa at end of third quarter

The latest PMI data provided assurance that the South African private sector economy is on the right track, with September seeing growth accelerate to the joint-fastest in over two years. The PMI average for Q3 (50.3) marked the first quarter of improving business conditions since Q4 2022, which is a good indicator of underlying strength in the economy.

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  • South Africa Corn-Export Forecast Raised to 1.9 Million Tons

South Africa’s Agricultural Business Chamber has raised its forecast for the country’s corn exports for the year ending April 2025 to 1.9 million tons. The increase, from a previous estimate of 1.85 million tons and an earlier forecast of 1.44 million tons, is due to higher-than-expected stocks carried over from the last season and a slight decrease in forecast domestic consumption,

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Zimbabwe

  • RBZ mobilizes US$900m to prop faltering economy

THE Reserve Bank of Zimbabwe (RBZ) last year secured US$900 million worth of funding packages from local, regional and international partners, to support critical foreign exchange requirements and bolster economic growth, according to report. The amount accessed in 2023 represented an 11% increase from funds accessed by the bank in 2022, according to the central bank’s financial results for the year ended December 31, 2023.

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  • ZiG Falls by 67% Amid Economic Turmoil

Amidst a backdrop of ongoing economic challenges, the Zimbabwe Gold (ZiG) currency has plummeted by 67% against the US dollar since its introduction.

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  • World Bank Approves $2025-2026 Strategy to Support Zimbabwe’s Economic Growth

The World Bank Group’s Board of Executive Directors has approved a new Country Engagement Note (CEN) for Zimbabwe, covering the period from 2025 to 2026. The CEN focuses on supporting Zimbabwe’s immediate development priorities and is closely aligned with the country’s Vision 2030 and National Development Strategy 2021-2025 goals.

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Zambia

  • Chinese firms plan to increase investment in Zambia’s mining sector

Chinese companies operating in Zambia plan to increase their investment in the southern African country’s mining sector by 5 billion U.S. dollars over the next five years and increase production to 280,000 tonnes of copper.  

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  • Zambia to Raise Power Tariffs by 115% to Pay for Imports

Zambia’s energy regulator approved the state-owned power utility’s request to raise electricity prices to pay for imports after the worst drought in more than 100 years hit hydropower plants resulting in prolonged daily blackouts.

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Central Africa

DR Congo

  • Emirati oil company Tristar gets green light to supply commercial airlines.

A year after the regional meeting held in Burundi in 2023, the Africa Centres for Disease Control and Prevention (Africa CDC) continues to advocate for and to review the progress made in the establishment and strengthening of National Public Health Institutes (NPHIs). Africa CDC organized a regional meeting from 16 to 17 September 2024 for the directors of NPHIs and technical experts from the Ministries of Health of Central Africa to take stock of progress 12 months later.

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  • Faults hit PetroNor’s production in Congo-Brazzaville.

Africa-focused independent PetroNor E&P saw year-on-year production decrease by 7% from 5113 barrels per day of oil to 4763 bpd in the third quarter of 2024 at its Pointe Noire Grand Fond (PNGF) Sud asset offshore Congo-Brazzaville.

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