November 15, 2024/United Capital Research

Anglophone West Africa (WAEMU)
Nigeria

• FG services foreign debt with $3.50bn

The Federal Government has spent $3.58bn servicing its foreign debt in the first nine months of 2024, representing a 39.77% y/y increase from the $2.56bn spent during the same period in 2023. According to the Central Bank of Nigeria (CBN), the highest monthly debt servicing payment in 2024 occurred in May, amounting to $854.37mn. In comparison, the highest monthly expenditure in 2023 was $641.70mn, recorded in July.
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• Total external trade rose to N6.90tn in Q2

According to Vice President Kashim Shettima, the trade facilitation programmes implemented by the current administration has increased the country’s trade balance to N6.50tn in Q2-2024. He further stated that efforts to maximise economic opportunities ensured that exports to other countries accounted for 60.89%, or equivalent to N19.42tn of total trade, representing a marginal increase of 1.31% q/q from N19.17tn in Q1-2024 and a 201.76% y/y increase from N6.44tn recorded in Q2-2023.
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• Nigeria secures $1.20bn deal to revamp gas plant for aluminium smelting

Nigeria has entered into a $1.20bn agreement with Chinese state-owned engineering firm, CNCEC, to revive a critical gas processing plant linked to the country’s aluminium production. The deal will see CNCEC resuscitate the 135 million standard cubic feet per day gas processing plant at the smelter, which has the capacity to produce 300,000 tons of aluminium annually.
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• Nigeria’s fiscal deficit surpasses budget projections, reaches 7.60% of GDP

Nigeria’s fiscal deficit continues to swell, with recent figures showing that budget deficit stands at 7.60% of Nigeria’s GDP as of Aug-2024, outpacing the approved 3.80% target for the year. At the start of 2024, the National Assembly approved a budget of N28.70tn with a revenue target of N19.50tn, leaving a budget deficit forecast of N9.1tn equivalent to about 3.80% of GDP. However, the deficit has surged well beyond projections, with a supplementary budget of N6.20tn proposed later in the year, compounding the fiscal strain.
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• Economists express worry over Nigeria’s public debt

According to the Debt Management Office (DMO), Nigeria’s public debt as of Q2-2024 reached N134.30tn. With the National Bureau of Statistics putting the country’s population as at the last count in 2022 at N216.7m persons, comprising 108.3million for males and 108.4million for females, it would mean that debt per capita stands at N619,501.
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Ghana

• Ghana shows early signals of improved crude oil production

Ghana’s crude oil production increased by 10.70% in the first half of 2024 compared to a 13.20% decline in the previous year. The increase from 22,452,078.81 barrels (bbls) in the first half of 2023 to 477.52 bbls in the same period of 2024 was due to the coming on stream of new wells under the Jubilee South East (JSE) project. This led to a 55.60% increase in total petroleum receipts from $540,456,124.27 in the first half of 2023 to $840,765,265.80 in 2024, the highest first half figure since 2012.
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• Bank of Ghana to commission new $250 million headquarters on November 20

The Bank of Ghana (BoG) is set to commission its newly constructed headquarters, named “The Bank Square,” on November 20 in Accra. President Nana Addo Dankwa Akufo-Addo will be the special guest of honour at the ceremony, scheduled to start at 10am. The event is strictly by invitation. The construction of the new headquarters has sparked debate in July this year, especially in light of the BoG’s reported 10.5 billion cedis loss in 2023. The bank paid approximately $250 million for the project, a move that has attracted scrutiny from several stakeholders, including Member of Parliament Yusif Suleman, who questioned the wisdom of continuing with the high-cost project amid such substantial losses.
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Francophone West Africa
Senegal

• Senegal heads to the polls amid fiscal crisis, threat of unrest

Senegal will vote in legislative elections on Sunday that will determine whether the new president and government can gain control over the national assembly and push through their agenda for reforms. The high stakes in the election are threatening to spark renewed unrest following a period of calm. The run-up to the presidential election in March saw some of the worst violence in the country’s recent history.
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• Senegal will have to wait at least until June for IMF loan resolution

Senegal will have to wait until at least June to get any sort of resolution of its lending programme with the International Monetary Fund that could lead to fresh disbursements. There was no immediate comment from the finance ministry on the prospect of a delay that will be a test for a government seeking quick support to help it deal with an increasingly precarious fiscal situation.
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Ivory Coast

• Ivory Coast to establish $500 mln green finance fund

Ivory Coast will create a $500 million green finance fund to support sustainable growth initiatives, the International Monetary Fund (IMF) said in a statement. Africa’s 54 countries have borne the brunt of climate change, despite releasing far fewer polluting emissions than the industrialised world. They receive just 1% of annual global climate finance. Ivory Coast’s new facility will be established under the African Green Banks Initiative, a platform working to create a $1.5 billion ecosystem of green investment facilities by 2030 on the continent.
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East Africa
Kenya

• Kenya Reports 5% Debt-to-GDP Drop as IMF Approves KSh 78b Loan

Kenya’s debt-to-GDP ratio has decreased to 68% from 73%, as government plans to enhance revenue collection through tax reforms The International Monetary Fund (IMF) recently approved a KSh 78 billion loan under the Extended Credit Facility (ECF).
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• Kenya’s Forex Reserves Surge to 3-Year High amid Shilling’s Stability

Kenya’s forex reserves have grown by US$1.97 billion in the last ten weeks with the Central Bank of Kenya (CBK) buying excess dollars amid increased supply of the greenback. Last week in particular, Kenya increased its reserves by a record US$737 million or 8.6% to bring the total to US$9.323 billion. The jump comes just a week after the International Monetary Fund (IMF) approved the US$606 million disbursement under the US$3.6 billion medium-term programme with Kenya after months of delays. The current reserves, the highest in 3 years, are enough to cover 4.8 months of imports, both falling above the 4 months statutory requirements and the EAC’s convergence requirement of 4.5 months of import cover.
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• State firms default on Sh266bn National Treasury-backed loans

Public institutions have defaulted on loans worth Sh266.5 billion, meaning Treasury will step in to settle their obligations. Taxpayers are at risk of ultimately repaying a total of Sh946 billion loans that have been issued to 28 public institutions.
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• State imports grow to record Sh89 billion

The value of import orders by government agencies rose at the fastest pace in at least eight years after they jumped 48.4 per cent during the 12 months to Junee 2024 to it Sh89.04 billion, coinciding with the current administration’s first full year in office.
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• KenGen earns Sh4bn from carbon credits sales

Kenya Electricity Generating Company (KenGen) is set to receive $32.05 million (Sh4.14 billion) by January from the sale of its Certified Emission Reductions (CERs), offering a sneak peek into the lucrative market of climate change initiatives.
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Rwanda

• Rwanda’s inflation is 3.8 percent year on year in October 2024

Rwanda’s Consumer Price Index (CPI), main gauge of inflation increased by 3.8 percent year on year in October 2024 up from 2.5 percent in September 2024. In October 2024, ‘Food and non-alcoholic beverages’ decreased by 1 percent on annual basis and it increased by 3.7 percent on monthly basis. ‘Housing, water, electricity, gas and other fuels’ increased by 4.8 percent on annual basis and it increased by 0.8 percent on monthly basis. Transport increased by 15.9 percent on annual basis and it was stable on monthly basis.
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• Rwandan traders recompense EAC losses with Comesa deals

Rwanda recorded the fastest growth in trade with Comesa peers in the year to December 2023, coming as its traders complained of significant non-tariff barriers limiting their business relations with East African Community partner states. The latest data from the Common Market for Eastern and Southern Africa (Comesa) indicates that Rwanda’s trade with other countries drawn from the bloc rose by 8.20%, the largest growth compared to its peers in the region in the EAC.
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Uganda

• Uganda to cut nearly all external borrowing in 2025/26, finance ministry says

Uganda will cut external borrowing by 98% in the financial year to June 2026 to reduce its increasing public debt, according to the finance ministry. Uganda’s public debt, which rose to $25.6 billion in June this year from $23.7 billion a year earlier according to finance ministry data, has elicited anger from Uganda opposition politicians and also triggered credit rating downgrades. The government says borrowing has been used to drive economic growth, which has been faster than many of its African peers since the COVID-19 pandemic.
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• Uganda boosts trade with Tanzania, DRC amid persistent tiffs with Kenya

Tanzania and the Democratic Republic of Congo are slowly overtaking Kenya as the largest consumers of Ugandan merchandise, a new trend likely to adjust the usual trade tiffs between East African Community partner states. The two largest East African Community partner states, by land size, are consuming more Ugandan products on a country-specific level, according to data from the Private Sector Foundation of Uganda (PSFU).
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Tanzania

• Tanzania’s exports to African countries surpass imports

The value of goods Tanzania exports to other African countries has reached $2.65 billion, nearly double the value of imports the country receives from the continent. According to the Arusha-based East African Business Council (EABC), data from the International Trade Centre indicates that Tanzania imported goods worth $1.5 billion from other African countries in 2023, reflecting a favourable trade balance for the nation.
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• Tanzania boosts local capacity in mining sector

The Tanzanian government has taken huge steps to address the shortage of skilled local professionals in the mining sector, aiming to reduce dependency on costly foreign experts while fostering an environment that supports sustainable growth.
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South Africa
South Africa

• Declining unemployment rate in SA fails to arrest the plunge in the markets

The rand shrugged off the positive data that South Africa had reduced its unemployment rate and plunged to its lowest in three months yesterday pressured by a stronger dollar and lower precious metals prices.
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• South Africa’s Jobless Rate Falls for First Time in a Year

South Africa’s unemployment rate fell for the first time in a year, driven by job increases in the community and social services and construction sectors, as business confidence improves and economic growth shows signs of recovery. The unemployment rate dropped to 32.1% in the three months through September, compared with 33.5% in the previous quarter, according to data released by Statistics South Africa in the capital, Pretoria, on Tuesday. The median estimate of three economists surveyed by Bloomberg was for the jobless rate to drop to 32.8%.
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• South Africa is committed to shale gas exploration, says Mantashe

South Africa’s Minister of Mineral and Petroleum Resources Gwede Mantashe on Thursday reiterated that the country was committed to developing its oil and gas sector, despite external pressures to transition to a greener economy.
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• South Africa’s ratings stuck in ‘junk’ despite investor optimism

South Africa will be unable to shed its “junk” credit rating for years to come, credit analysts said, despite investor optimism over the economic trajectory since the formation of a government of national unity (GNU) this year. S&P Global is scheduled to review the country’s sovereign rating on Friday, though the agency has its long-term foreign currency rating three notches into subinvestment grade at “BB-“, with a stable outlook.
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• Manufacturing sector threatens to drag Q3 GDP growth despite easing load shedding

Productivity in South Africa’s manufacturing sector fell for the second month in a row in September, remaining subdued despite easing electricity supply challenges.
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Angola

• Angola LNG considers expansion as gas supplies ramp up

Angola Liquefied Natural Gas (ALNG) is considering future expansion options including adding a mini train of three million metric tons a year, as new gas supplies to the plant ramp up over the next 12 months. Extra supplies expected from Chevron by year-end and the New Gas Consortium by the end of 2025 will help to take the plant to full capacity for the first time. Africa’s second-largest crude producer plans to pivot more towards natural gas to capture growing demand in key markets in Europe and Asia.
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Zambia

• Zambia Lifts Key Rate to Seven-Year High to Support Currency

Zambia’s central bank raised its key interest rate to the highest level since 2017 to contain price pressures and prop up its bruised currency. The monetary policy committee lifted the rate to 14% from 13.5%, Governor Denny Kalyalya told reporters in the capital, Lusaka, on Wednesday. “The decision to raise the policy rate is aimed at steering inflation back towards the target band and anchoring inflation expectations,” he said, adding “we took account of what was happening in the foreign exchange market.” Annual inflation has been above the central bank’s 6%-8% target since May 2019.
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• IMF reaches staff agreement with Zambia for $185.50mn disbursement

The International Monetary Fund said on Monday that it reached a staff-level agreement for the fourth review of Zambia’s loan program that would release about $185.5 million to Lusaka upon approval by the IMF’s management and its executive board. The agreement was announced after an IMF mission to Zambia from Oct. 2-15, followed by subsequent discussions at IMF and World Bank annual meetings in Washington, the Fund said in a statement.
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• China To Invest Over $1.5 Billion In Zambian Mines

China Non-Ferrous Metals Company CNMC Chairperson Wen Gang has announced that his company is set to bring in about 1.5 billion dollars investment in the mining sector in the country. Mr Gang said this decision was made following the engagements with President Hakainde Hichilema in China on the sidelines of the Forum on China-Africa Cooperation FOCAC Summit in September this year, coupled with the good investment environment that the country has.
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Zimbabwe

• RBZ bemoans lack of confidence in ZiG

A Reserve Bank of Zimbabwe (RBZ) monetary policy committee member has admitted that confidence in the six-month-old Zimbabwe Gold (ZiG) currency has bottomed to a historic low. Zimbabwe introduced the ZiG in April this year pegged at ZiG13,50 to one United States dollar.
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• Zim in fresh push to resolve arrears, debt crisis

The government will host another session of the high-level structured dialogue platform forum on November 25 to update all stakeholders on the progress made to date and discuss the roadmap for the arrears clearance and debt resolution process, NewsDay can report.
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Central Africa
Cameroon

• Cameroon still has nearly CFA4 trillion in unused foreign loans

Cameroon’s National Sinking Fund (CAA) reported the availability of around CFA3,980.1 billion of unused foreign loans in the national coffers as of the end of September 2024. This volume is 5.2% higher than last year’s contracted but undisbursed debt (SENDs). According to the CAA, SENDs represent financial resources that Cameroon has borrowed from international financial partners, including other governments and multilateral institutions, but has not yet drawn on.
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• Bank Loans Hit Record CFA5,607bn in H1 2024, Up 3.75%

Bank lending in Cameroon reached a record CFA5,607 billion between December 2023 and June 2024, representing a 3.75% increase compared to the previous six months. This data comes from the regulatory reports of the Collection, Processing, and Feedback System for Banks and Financial Institutions (Cerber), established by the Bank of Central African States (BEAC) and Cameroon’s National Economic and Financial Committee (CNEF).
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• China Construction Bank Pulls Out of Cameroon’s CFA33bn Urban Surveillance Project

The China Construction Bank Corporation (CCBC) has canceled its CFA33 billion funding for phase two of Cameroon’s intelligent urban surveillance system extension project, according to the National Sinking Fund (CAA). The agreement, signed in 2021 for the project’s expansion, is now in the process of being canceled due to the withdrawal of the initial financial partner. The CAA mentioned this in its latest public debt report at the end of September 2024.
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Democratic Republic of Congo (DRC)

• IMF Reaches Staff-Level Agreement with the Democratic Republic of Congo on An Extended Credit Facility and A Resilience and Sustainability Facility

Democratic Republic of Congo (DRC) authorities and the IMF reached a staff-level agreement on a new economic and financial arrangement supported by the Extended Credit Facility (ECF) and a new climate-focused arrangement supported by the Resilience and Sustainability Facility (RSF). The ECF-supported program aims to foster strong and inclusive growth, accelerate economic diversification, stimulate job creation, enhance living standards, advance governance and transparency, and alleviate poverty, through ramped up high-quality investment in priority infrastructure and social sectors. The RSF-supported program aims to help DRC realize its strategic vision as a “solution country” in the transition towards a low-carbon global economy, while strengthening its resilience to climate shocks.
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