December 6, 2024/United Capital Research

Anglophone West Africa (WAEMU)
Nigeria

• Nigeria issues two Eurobonds with yields over 10.00% to address 2024 budget deficit

Nigeria has returned to the international capital market for the first time in over two years (March 2022) with a significant Eurobond offering, aimed at funding the country’s 2024 budget deficit. The government is issuing $500mn in 6.5-year bonds, alongside a benchmark-size offering of 10-year bonds, with yields expected in the 10.125% area for the shorter-dated securities and 10.625% for the longer maturities. The bonds will be issued in U.S. dollars, with semi-annual coupons, and are structured in 144A/Reg S format, making them accessible to both U.S. and international investors.
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• 2025 Budget: Senate approves President Tinubu’s 2025-2027 Medium-Term Framework

The Nigerian Senate has officially approved the 2025–2027 Medium-Term Expenditure Framework and Fiscal Strategy Paper (MTEF-FSP), setting the stage for a N47.90tn budget proposal for 2025.  The proposed budget includes N16.4 trillion allocated to capital projects, while N14.20tn is earmarked for recurrent expenditure. Key economic assumptions such as oil benchmark price, daily crude oil production, GDP growth, and an exchange rate projection of N1,400/$1 were also approved.
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• France leads as Nigeria’s top net export destination in 2024

Nigeria’s exports to France surged to over N3.90tn (approximately $2.40bn) in Q1-2024, surpassing the N2.30tn recorded for the entirety of 2023, solidifying France’s position as Nigeria’s top export destination among single countries. Nigeria’s total trade exports stood at approximately N38.50tn ($24.00bn) during the same period. The country maintained a positive trade balance, with exports exceeding imports, which stood at around N26.40tn ($16.50bn).
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• Naira devaluation raises foreign debt by N30tn

Naira devaluation has raised Nigeria’s external debt by about N30.03tn between 2023 and June 2024 when considered in naira terms. Data from the Debt Management Office shows that as of June 1, 2023, Nigeria’s external debt stood at $43.16bn. At an exchange rate of N770.38 to the dollar, this amounted to N33.25tn. However, by June 1, 2024, the naira had depreciated by 47.6 per cent, with the exchange rate rising to N1,470.19 to the dollar.
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Ghana

• IMF approves third review of Ghana’s $3 billion programme

The International Monetary Fund (IMF) has approved the third review of Ghana’s $3 billion lending programme, unlocking an immediate disbursement of about $360 million. “Ghana’s performance under the IMF-supported program has been generally satisfactory. All quantitative performance criteria and indicative targets for the third review were met,” the IMF said in a statement.
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• Ghana inflation rises for third month in November

Ghana’s consumer inflation opens new tab rose for the third month in a row in November, to 23.0% year on year from 22.1% in October, the statistics service said on Wednesday. Government statistician Samuel Kobina Annim told a news conference that the latest increase was driven by food prices. “Vegetables, tubers and plantains are the major drivers of the increment in food inflation,” he said. Last week, Ghana’s central bank kept its main interest rate(GHCBIR=ECI), opens new tab at 27.00%, citing high food prices among reasons why it saw an elevated inflation profile.
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• Ghana central bank holds policy rate on inflation concerns

Ghana’s central bank kept its main interest rate at 27.00%, as food price increases drove consumer inflation higher for the second month in a row. While inflation has eased considerably over the year, the pace of deceleration showed some sluggishness since the last monetary policy committee meeting, the central bank said. “Inflation projections show a slightly elevated profile driven by high and unstable food prices,” the bank said in a statement.
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Francophone West Africa (WAEMU)
Ivory Coast

• Ivory Coast cocoa exporters fear drop in supplies after poor weather

Multinational cocoa exporters operating in Ivory Coast, the world’s top cocoa producer, fear a drop in supplies from farmers in the coming months after adverse weather hit crops, raising the prospect that some of them might default on contracts. So far this season, the volume of beans arriving at ports is up 34% on the same time in 2023-24. But last season was the worst in a decade.
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• World Bank ventures into debt swaps with Ivory Coast education deal

The World Bank said it had helped Ivory Coast launch a debt-for-education swap in a landmark first transaction for the Washington-based lender. The Ivory Coast government will buy back 400 million euros ($423 million) of its most expensive commercial debt due in the next five years with the help of a commercial loan raised at a lower interest rate, a longer maturity and a grace period thanks to a partial World Bank guarantee, it said in a statement.
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East Africa
Kenya

• State Revives Kenya Sugar Board to Revitalize Ailing Industry

The government has resurrected Kenya Sugar Board through the enactment into law Sugar Bill 2022 in a move aimed at breathing life into the ailing sector.
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• Gov’t Suspends US$ 2.43 Price Floor on Tea as Glut Intensifies

The Ministry of Agriculture will curb the harvesting of Macadamia starting next month, all the way to March next year to prevent the export of immature, poor quality nuts.
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• KenGen signs KSh 250mn Geothermal Deal with Eswatini

Listed energy firm KenGen will conduct geoscientific studies in three regions of Eswatini to determine the feasibility of developing a geothermal power plant in the country, after signing a KSh 250 million contract with the state’s electricity provider.
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• Bankers Push for Further Rate Cuts by the Central Bank

Bankers have urged the Central Bank of Kenya (CBK) to further cut its benchmark rate at its final Monetary Policy Committee (MPC) meeting of the year on 5th December 2024.
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• Relief for Banks as Parliament Proposes Extending Core Capital Hike to 8 years

The National Assembly’s Finance and Planning Committee has proposed to extend the period that commercial banks will raise their core capital to at least KSh 10 billion from three to eight years. The Kenya Bankers Association (KBA) lobbied for the extension of the period of compliance to this requirement, which was initially set at 3 years.
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Uganda

• BOU Holds Policy Rate at 9.75% as Inflation Eases

The Bank of Uganda (BOU) has kept its benchmark lending rate at 9.75%, citing declining inflation and rising investment in the country’s nascent oil & gas sector.
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• Uganda: Kampala City Registers Increase in Revenue Collection

The Minister for Kampala, Hajjat Minsa Kabanda, has announced that Kampala’s revenue collection for the financial year 2023/24 stands at sh114.4bn, an increase compared to the 2020/21 financial year.
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Tanzania

• MMI Steel Mills laud government’s business reforms

MMI Integrated Steel Mills Ltd has commended the government’s efforts in creating a conducive business environment that has propelled trade and industrial growth. The Company’s Chief Executive Officer, Mr Gurlochan Singh, emphasised the role of the Ministry of Industry and Trade and the Tanzania Revenue Authority (TRA) in supporting these developments..
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• KCB pledges to foster digital regional economic integration

KCB Bank has reaffirmed its commitment to spearheading digital payment transformation in the East African region through cutting-edge digital payment solutions that cater to the evolving needs of individuals, businesses and communities.
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• Tanzania: Beverage industry sees significant growth

Tanzania’s beverage industry has experienced a remarkable surge, driven by robust market demand. The industry generated a staggering 3.0 billion US dollars (8.95tri/-) in total sales last year, up from about 2.5 billion US dollars (6.58tri/-) the previous year, according to the Tanzania Investment Centre (TIC).
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South Africa
South Africa

• South African economy unexpectedly shrinks due to drought

South Africa’s economy unexpectedly shrank in the third quarter of this year as a drought caused a big drop in agricultural production, but analysts said they expected a return to modest growth in the coming quarters. Data from Statistics South Africa showed gross domestic product (GDP) fell 0.3% in seasonally adjusted quarter-on quarter terms. Agriculture, forestry and fishing contracted 28.8% quarter on quarter, primarily due to field crops.
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• South African factory sector contracts in November, Absa PMI shows

South African manufacturing activity fell in November, a local purchasing managers’ index (PMI) survey showed, as volatile demand conditions weighed on business activity. The seasonally-adjusted PMI sponsored by South African bank Absa slipped to 48.1 points in November from 52.6 in October, falling below the 50-point mark that separates expansion from contraction. The business activity and new sales orders sub-indices both fell last month, reversing the gains it made in September and October, Absa said.
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• Moody’s affirms South Africa’s Ba2 rating amid economic challenges and political change

Credit ratings agency Moody’s affirmed South Africa’s Ba2 rating, highlighting the country’s robust financial sector and external position following a recent regime change. Reduced power cuts and expectations of lower interest rates have improved South Africa’s financial stability following successful elections in June, the country’s central bank said in November.
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• South Africa’s current account deficit broadly unchanged in Q3

South Africa’s current account deficit was broadly unchanged from the second to the third quarter of this year, staying at 1.0% of gross domestic product (GDP), central bank data showed. In rand terms, the current account deficit narrowed to 70.8 billion rand ($3.91 billion) in July-September from a revised 75.3 billion rand in the previous three-month period. The trade surplus narrowed slightly to 177.0 billion rand from 179.5 billion rand, as the value of goods exported decreased more than that of imports.
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• South Africa budget deficit at 46.08 bln rand in October

South Africa recorded a budget deficit of 46.08 billion rand ($2.55 billion) in October, compared with a deficit of 41.15 billion rand in the same month a year earlier, National Treasury data showed. ($1 = 18.0501 rand).
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• S.African consumer confidence drops, but signals strong festive season

South Africa’s consumer confidence slipped one point in the fourth quarter, although retail sales during the festive season are still expected to be their best levels last seen in 2019, a survey showed. The consumer confidence index (CCI), sponsored by First National Bank (FNB) and compiled by the Bureau for Economic Research (BER), edged down to minus 6 points in the reported period from minus 5 a quarter ago.
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Namibia

• Namibia central bank delivers third straight rate cut

Namibia’s central bank cut its main interest rate for the third meeting in a row on Wednesday, as inflation continued to tick lower in the southern African country. The Bank of Namibia reduced its repo rate by 25 basis points to 7.00% after similar-sized cuts in October and August. The decision comes a day after vote results showed Namibia had elected Netumbo Nandi-Ndaitwah from the ruling SWAPO party as its next president and first female leader.
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• Namibia elects Nandi-Ndaitwah as first female president

Netumbo Nandi-Ndaitwah of Namibia’s ruling SWAPO party has been elected president and will be the country’s first female leader, results released by the country’s electoral commission showed. Nandi-Ndaitwah, 72, is the current vice president. Her victory will extend SWAPO’s 34 years in power since it led Namibia to independence from apartheid South Africa in 1990. She received roughly 57% of valid votes in the presidential race, according to a breakdown given by the Electoral Commission of Namibia.
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• Namibia’s president-elect pledges ‘radical shifts’ on poverty and unemployment

Namibia’s President-elect Netumbo Nandi-Ndaitwah pledged “radical shifts” to fix the country’s high levels of poverty and unemployment, speaking on Thursday in her first press conference. Nandi-Ndaitwah, who will take office in March as the first woman to hold the post in the southern African country, suggested she might break with her SWAPO party predecessors on some social and economic issues.
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Zambia

• Zambia Private Sector Downturn Eases

The Stanbic Bank Zambia PMI increased to 49.2 in November 2024 from 47.9 in October, signaling a marginal decline in private sector activity and the slowest in four months. The modest improvement was driven by a renewed expansion in new orders, ending a three-month contraction, as stronger demand boosted sales in agriculture and services.
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Zimbabwe

• Zimbabwe central bank keeps policy rate at 35%

Zimbabwe’s central bank said that its Monetary Policy Committee (MPC) had met and decided to leave its policy rate unchanged at 35%. The bank said in a statement that the MPC wanted to maintain a tight policy to anchor inflation expectations. In September, the central bank allowed the country’s recently launched currency, Zimbabwe Gold, to fall over 40% and hiked its policy rate to 35%. The devaluation caused a sharp spike in inflation in October, when prices rose by 37.2% month-on-month in local currency terms. November’s month-on-month inflation rate slowed to 11.7%.
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Central Africa
Cameroon

• Cameroon fuel prices to rise further in 2025, fresh subsidy cuts ahead

Fuel pump prices across Cameroon are set to rise again next year as the government plans further subsidy cuts in line with International Monetary Fund recommendations. The IMF had urged the Central African nation for years to cut fuel subsidies. This would be the third cut since Yaounde began taking action early last year. The latest move would slash the subsidy by more than 90% to 15 billion CFA francs ($24 million) from 263 billion CFA francs ($424 million) according to a draft finance bill for 2025.
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• Cameroon Plans CFA600bn in Domestic Borrowing for 2025

The 2025 finance bill, currently under review by the National Assembly, estimates Cameroon’s state financing needs for 2025 at CFA1,795 billion. To raise this amount, which is CFA275.1 billion less than the 2024 budget, the government will need to rely on borrowing. The finance document submitted for parliamentary review includes plans to raise CFA600.6 billion from the domestic market.  Specifically, the government plans to borrow CFA220.6 billion from the banking market and CFA380 billion through public bond issues.
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• Paul Biya Approves CFA49bn Loan for Cameroon’s Electricity Recovery

Cameroon’s President Paul Biya has authorized a loan of €74.25 million (around CFA49 billion) from the African Development Bank (AfDB) to support the country’s emergency electricity recovery plan. The funds will be used to implement the Support Program for the Recovery of the Electricity Sector in Cameroon (Parsec). This program aims to improve electricity production, distribution, and governance.
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• Cameroon Plans 16% Increase in Public Investment Spending for 2025

The Cameroonian government has proposed a public investment budget of CFA1.8631 trillion for 2025, according to its draft finance law. This represents an increase of CFA259 billion, or 16.1%, compared to CFA1.6041 trillion allocated in 2024.           Public investment accounts for 33.5% of total budget expenditures in 2025,” the government highlighted in the draft law. With this proportion, Cameroon is gradually approaching the 40% target outlined in its National Development Strategy 2020-2030 (SND30).
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