<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-820x547.jpg" alt="" class="wp-image-424241" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/04/QOM6DFY4YFKBTJHWK36SCHU26U-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: The International Monetary Fund (IMF) logo in Washington, United States, September 4, 2018. REUTERS/Yuri Gripas/File Photo</figcaption></figure>



LONDON, April 17 (Reuters)&nbsp;&#8211;&nbsp;The International Monetary Fund&#8217;s Board has backed a key change to give it more freedom to support crisis-hit countries even if debt renegotiations with big creditor governments like China are still ongoing.



The proposal is to reform what the IMF calls its Lending Into Official Arrears (LIOA) policy, a framework that determines if and when it can lend to a country that owes money to another IMF-member nation.



In a statement late on Tuesday the Fund said its Executive Board had endorsed &#8220;reforms to promote the IMF&#8217;s capacity to support countries undertaking debt restructurings&#8221;.



A key change will be that it will be able to lend to a country where no debt agreement with one or more of its bilateral creditors has been reached if the Fund has been provided with &#8220;additional safeguards&#8221;.



Debt crisis veterans have been long been urging a change to the IMF&#8217;s approach having seen delays in agreements with the likes of China widely blamed for dragging out Zambia, Ethiopia and Sri Lanka&#8217;s defaults for years.



&#8220;Directors supported the addition of a fourth strand under which the Fund shall seek additional safeguards where an adequately representative agreement has not been reached through a representative standing forum,&#8221; the IMF said.



(Reporting by Marc Jones; editing by Philippa Fletcher)

FILE PHOTO: The IMF logo is seen outside the headquarters building in Washington

IMF Board backs key change to lending-into-official-arrears policy

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="571" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-820x571.jpg" alt="" class="wp-image-477407" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-820x571.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-768x535.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-1536x1070.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/LZJDLC7DLROENA6JMXYHS2EK2E-1-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A woman uses a trolley as she shops at a Pick n Pay store at the Dobson Point Shopping Centre, in Soweto, South Africa, March 19, 2024. REUTERS/Siphiwe Sibeko/File photo</figcaption></figure>



JOHANNESBURG, April 17 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s headline consumer inflation fell to 5.3% year on year in March from 5.6% in February&nbsp;ZACPIY=ECI, statistics agency data showed on Wednesday.



Analysts polled by Reuters had forecast that inflation would slow to 5.4% in annual terms.



The South African Reserve Bank (SARB) kept its main interest rate unchanged at 8.25%&nbsp;ZAREPO=ECI&nbsp;last month, saying its policy stance needed to remain restrictive to tackle higher inflation expectations.



It expects headline inflation to reach the midpoint of its target range of 4.5% only near the end of 2025.



SARB Governor Lesetja Kganyago told Reuters earlier in April that South African policymakers were in discussions to lower the bank&#8217;s current inflation target range of between 3% and 6% to bring it more in line with peers.



On a month-on-month basis, inflation was at 0.8% in March compared to 1.0% a month before, Statistics South Africa said.



This is a developing story&#8230;



(Reporting by Bhargav Acharya; Editing by Alexander Winning)

A woman uses a trolley as she shops at a Pick n Pay store, in Soweto

South Africa inflation slows slightly more than expected in March

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="525" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-820x525.jpg" alt="" class="wp-image-477046" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-820x525.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-300x192.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-141x90.jpg 141w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-768x491.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-1536x983.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/W24QXKQRMVIZVBZNLSSJ7GLVBU-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: The company logo for Johnson &amp; Johnson is displayed to celebrate the 75th anniversary of the company&#8217;s listing at the New York Stock Exchange (NYSE) in New York, U.S., September 17, 2019. REUTERS/Brendan McDermid/File Photo</figcaption></figure>



Corrects to the Zimbabwean regulator saying it &#8220;did not have a record of&#8221; the syrup being imported into the country instead of that it &#8220;did have a record of&#8221; in penultimate paragraph



KIGALI, April 15 (Reuters)&nbsp;&#8211;&nbsp;Drug regulators in Tanzania, Rwanda and Zimbabwe have recalled a batch of Johnson &amp; Johnson&nbsp;JNJ.N&nbsp;children&#8217;s cough syrup as a precautionary measure after their Nigerian counterpart said laboratory tests found high levels of toxicity.



The countries join Nigeria, Kenya and South Africa in recalling the same batch of the syrup, which is used to treat coughs, hay fever and other allergic reactions in children. South Africa has also recalled an additional batch.



Laboratory tests on the syrup by Nigeria&#8217;s health regulator showed a high level of diethylene glycol, which has been linked to the deaths of dozens of children in Gambia, Uzbekistan and Cameroon since 2022 in one of the world&#8217;s worst waves of poisoning from oral medication.



Diethylene glycol is toxic to humans when consumed and can result in acute kidney failure.



The batch of Benylin Paediatric syrup recalled was made by J&amp;J in South Africa in May 2021, although Kenvue&nbsp;KVUE.N&nbsp;now owns the brand after a spin-off from J&amp;J last year.



Tanzania Medicines and Medical Devices Authority (TMDA) said it had begun the recall on April 12 after hearing about the Nigerian test results.



&#8220;This is an exercise that does not involve investigation but rather monitoring to ensure that those affected drugs are removed from the market,&#8221; TMDA spokesperson Gaudensia Simwanza told Reuters on Monday.



A spokesperson for Kenya&#8217;s drug regulator said its test results on the syrup would likely be ready on Wednesday.



&#8220;A review of our safety database doesn&#8217;t reveal any adverse events reported,&#8221; the Rwanda Food and Drugs Authority said in a statement dated April 12. &#8220;However, Rwanda FDA issues the present recall for precautionary measures.&#8221;



Zimbabwe&#8217;s Medicines Control Agency said that it did&nbsp;not&nbsp;have a record of the product&#8217;s importation into Zimbabwe, but that it was concerned the syrup could enter the local market illegally. It said it would step up inspections in case.



Kenvue said in a statement that it was conducting its own assessment and working with health authorities to determine a course of action.



(Reporting by Philbert Girinema, Nuzulack Dausen and Nyasha Chingono; Additional reporting by Aaron Ross; Writing by Bhargav Acharya; Editing by Hereward Holland, Susan Fenton and Alexander Smith and Aurora Ellis)

FILE PHOTO: The company logo for Johnson & Johnson is displayed to celebrate the 75th anniversary of the company’s listing at the NYSE in New York

Tanzania, Rwanda, Zimbabwe join African recall of J&J cough syrup

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-820x547.jpg" alt="" class="wp-image-476778" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/GettyImages-1243546489-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The World Bank Group headquarters in Washington, DC, US, on Tuesday, Sept. 27, 2022. World Bank President Malpass said he hasn&#8217;t considered resigning and isn&#8217;t under pressure from member countries to do so, after critics slammed him for dodging questions on whether he accepted the scientific consensus that the burning of fossil fuels is driving global warming. Photographer: Samuel Corum/Bloomberg via Getty Images</figcaption></figure>



WASHINGTON, April 15 (Reuters)&nbsp;&#8211;&nbsp;Half of the world&#8217;s 75 poorest countries are experiencing a widening income gap with the wealthiest economies for the first time this century in a historical reversal of development, the World Bank said in a report on Monday.



The differential between per capita income growth in the poorest countries and the richest has widened over the past five years, according to the report.



&#8220;For the first time, we see there is no convergence. They&#8217;re getting poorer,&#8221; Ayhan Kose, deputy chief economist for the World Bank and one of the report&#8217;s authors, told Reuters.



&#8220;We see a very serious structural regression, a reversal in the world &#8230; that&#8217;s why we are ringing the alarm bells here,&#8221; he said.



The report said the 75 countries eligible for grants and zero-interest loans from the World Bank&#8217;s International Development Association (IDA) risk a lost decade of development without ambitious policy shifts and significant international aid.



Kose said growth in many IDA countries had already begun to taper off in these countries before the COVID-19 pandemic, but it would be just 3.4% in 2020-2024, the weakest half-decade of growth since the early 1990s. Russia&#8217;s invasion of Ukraine, climate change, increases in violence and conflict also weighed heavily on their prospects.



More than half of all IDA countries are in Sub-Saharan Africa; 14 are in East Asia and eight are in Latin America and the Caribbean. Thirty-one have per capita incomes of less than $1,315 a year. They include the Democratic Republic of Congo, Afghanistan and Haiti.



One in three IDA countries is poorer now than on the eve of the pandemic. IDA countries account for 92% of the world&#8217;s people who lack access to a sufficient quantity of affordable, nutritious food. Half of the countries are in debt distress, meaning they are unable to service debt or are at high risk of not being able to.



And despite their young populations &#8211; a demographic boon at a time when populations were aging nearly everywhere else, rich natural resources and abundant solar-energy potential, private and government creditors had been backing away from them.



U.S. Treasury Undersecretary Jay Shambaugh raised concerns about the worsening situation last week, warning China and other emerging official creditors against free-riding by curtailing loans to low-income countries just as the IMF or multilateral development banks were pouring funds in.



Almost 40 countries saw external public debt outflows in 2022, and the flows likely worsened in 2023, he said.



Kose said ambitious policies were needed to accelerate investment, including domestic efforts to strengthen fiscal, monetary and financial policies, and structural reforms to improve education and increase domestic revenues.



Significant financial support from the global community was also essential to make progress and lower the risk of protracted stagnation, Kose said, noting that the World Bank hoped to drum up a robust replenishment of IDA funds by December.



Stronger international coordination on climate change, debt restructurings and measures supporting cross-border trade would also be crucial, it said.



Indermit Gill, World Bank chief economist, noted that China, India and South Korea &#8211; now major economic powerhouses &#8211; had once been among the world&#8217;s poorest countries, but were able to tackle extreme poverty and raise living standards.



&#8220;The world cannot afford to turn its back on IDA countries,&#8221; he said.



(Reporting by Andrea Shalal; Editing by Edwina Gibbs)

World Bank As Chief Wont Resign Over Climate Comments

World Bank sounds alarm on ‘historical reversal’ of development for poorest nations

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-820x547.jpg" alt="" class="wp-image-476763" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /></figure>



LAGOS, April 15 (Reuters)&nbsp;&#8211;&nbsp;Nigeria&#8217;s creaking grid collapsed for the fifth time this year in the early hours of Monday, highlighting the country&#8217;s inability to provide reliable power after raising tariffs for wealthier consumers by 230% only two weeks ago.



Nigeria&#8217;s electricity regulator on April 3 approved an increase in tariffs for the 15% of consumers who use the most power, as the government tries to reduce the $2.6 billion worth of subsidies for the sector.



The head of the Nigerian electricity regulator, Musiliu Oseni, defended the tariff increase saying it will mean an end to grid collapses and bring investment into the sector.



National supply data showed the supply of power via the grid fell to around 50MW early on Monday from 4,020MW the previous day.



The Transmission Company of Nigeria, which oversees the grid, has not yet issued a statement on the cause of the latest near complete halt to the supply of power via the grid and did not immediately reply to an inquiry by Reuters.



Gas shortages and vandalism have triggered grid collapses in the past.



The new rate raises the tariff to 225 naira per kilowatt hour from a maximum of 68 naira for about 15% of customers, who will enjoy a maximum of 20 hours of supply daily.



Some analysts have criticised the tariff increase because it pushes more power to wealthier consumers from the meagre 4,000MW available for distribution to over 200 million Nigerians from the grid.



Nigeria, Africa&#8217;s most populous nation, faces perennial power shortages that have contributed to years of weak economic growth.



Its electricity sector faces a myriad of problems, including a failing grid, gas shortages, high debt and vandalism. The country has 12,500 megawatts of installed capacity, but produces only about a quarter of that, leaving many Nigerians reliant on expensive diesel-powered generators.



(Reporting by Isaac Anyaogu; Editing by David Holmes)

TD7QUJR4U5NX7IGFIXM2KWAA5A-scaled-1

Nigeria’s grid collapses weeks after tariffs raised for wealthier consumers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-820x547.jpg" alt="" class="wp-image-476698" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/TNUFZSJVAFIWBGPJVBHQEIKI3Q-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">People walk in front of closed shops as traders lock up their stores in protest of Ghana&#8217;s worsening economic conditions in Accra, Ghana October 19, 2022. REUTERS/Francis Kokoroko</figcaption></figure>



JOHANNESBURG/ACCRA, April 15 (Reuters)&nbsp;&#8211;&nbsp;Ghana has failed to strike a deal with two bondholder groups to restructure $13 billion of international bonds, the government said on Monday, in a blow to its efforts to swiftly emerge from default and economic crisis.



Talks were derailed for now after the International Monetary Fund (IMF) indicated that the deal would not fit its debt sustainability parameters, which set out how much debt it thinks a country can afford, the government said in a statement.



Ghana had been in formal talks with two groups holding its international bonds since March 16 &#8211; one &#8220;international&#8221; group of Western asset managers and hedge funds and another one including regional African banks.



The regional African bondholder group had also rejected part of the proposed rework, including an option to retain the original value of the bonds with a longer maturity and lower coupon.



In December 2022, Ghana defaulted on most of its external debt of about $30 billion as it fell into economic crisis. Debt costs and inflation surged, reserves dwindled and the government found itself unable to access international bond markets.



Growth in the world&#8217;s second biggest cocoa producer has since started to recover, with the economy growing 2.9% in 2023, better than the 2.3% the IMF predicted in January.



&#8220;The Government is actively working on solutions that it believes would be consistent with IMF program parameters under the set of policies currently being discussed, with the objective of reaching a mutual agreement acceptable to all parties,&#8221; the government said in the regulatory statement.



The dollar-denominated bonds, known as eurobonds, fell between 2.6 and 3.2 cents, with most of the maturities trading between the 46 and 48 cents in the dollar mark, according to Tradeweb data.&nbsp;XS1968714540=TE



Regional bondholders believe the Ghanaian economy&#8217;s strong performance compared to the IMF&#8217;s original analysis of its debt sustainability could a pave the way to a deal by the end of 2024, Samuel Sule, Chief Executive Officer at Renaissance Capital Africa and financial advisor to the group, told Reuters.



The IMF approved a $3 billion, three-year loan program to Ghana in May 2023, contingent on Ghana undergoing reforms and finishing a debt restructuring that the fund deems sustainable.



Ghana&#8217;s government said the IMF had assessed the proposed bondholder deal against debt sustainability thresholds from the first review of the loan program, which was finished in January. The second review, in which thresholds could change, is ongoing.



An advisor to the international bondholder committee said in a statement that restructuring discussions would continue this week.



<h2 class="wp-block-heading" id="h-at-some-point">&#8216;AT SOME POINT&#8217;</h2>



Ghana &#8211; together with Zambia and Ethiopia &#8211; is reworking debt under the G20 Common Framework, a process set up during the COVID-19 pandemic to speed up debt overhauls.



However, progress has been slow.



Zambia struggled to get its bond restructuring deal over the line amid objections from official creditors, though it eventually reached an agreement in principle in late March.



Ghana is &#8220;confident&#8230; at some point&#8221; it will reach an agreement with bondholders, Finance Minister Mohammed Amin Adam told a press conference on Saturday.



The IMF&#8217;s Ghana mission chief Stephane Roudet told the joint news briefing, held to coincide with a staff-level agreement on the IMF&#8217;s second review of its $3 billion loan programme, that the Fund needed to continue to see progress in talks with bondholders.



Ghana is aiming to cut $10.5 billion from its external debt repayments and interest costs due from 2023 to 2026. It reached an agreement in principle in January to rework $5.4 billion of loans with official creditors, which will need to confirm that the bondholder deal is comparable to what they offered.



The bondholder deal that had been proposed would have included a heavily discounted option of three bonds maturing between 2030 and 2038 with coupons of 5% until 2027 and 6.5% after. Another &#8220;PAR option&#8221; offering no principal reduction would have matured in 2043, with a 1.5% coupon.



Bondholders who signed up for either option would have also received a separate bond representing accrued &#8220;Past Due Interest&#8221;. This bond and the discounted options would have had a nominal, face value haircut of 33%.



Some bondholders had favoured the use of so-called state-contingent debt instruments, which could increase payouts if Ghana&#8217;s economy performs better on agreed metrics, as a way of bridging differences in their outlook.



Bondholders had also pushed for a number of extra conditions to be included. IMF spokespeople did not immediately respond to a request for comment.



(Reporting by Rachel Savage and Maxwell Akalaare Adombila; Additional reporting by Bhargav Acharya in Johannesburg and Mrinmay Dey in Bangalore, Editing by Karin Strohecker, Lincoln Feast and Ros Russell)

Ghana traders close shops to protest worsening economy

Ghana fails to reach debt deal with international bondholders

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="615" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-820x615.jpg" alt="" class="wp-image-475886" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-820x615.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-300x225.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-120x90.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-768x576.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-1536x1152.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/2Y6XTVFSZVPOPO5NVBOIEAEKKY-1-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">People carry bags of relief grains at a camp for the Internally Displaced People in Adadle district in the Somali region, Ethiopia, January 22, 2022. Picture taken January 22, 2022. Claire Nevill/World Food Programme/Handout via REUTERS/File Photo</figcaption></figure>



DAKAR, April 12 (Reuters)&nbsp;&#8211;&nbsp;Soaring prices have helped fuel a food crisis in West and Central Africa, where nearly 55 million people will struggle to feed themselves in the coming months, U.N. humanitarian agencies warned on Friday.



The number facing hunger during the June-August lean season has quadrupled over the last five years, they said, noting that economic challenges such as double-digit inflation and stagnating local production had become major drivers of the crisis, beyond recurrent conflicts in the region.



Among the worst-affected countries are Nigeria, Ghana, Sierra Leone, and Mali, where around 2,600 people in northern areas are likely to experience catastrophic hunger, said the World Food Programme, U.N. children&#8217;s agency UNICEF, and the Food and Agriculture Organization in a joint statement.



&#8220;The time to act is now. We need all partners to step up &#8230; to prevent the situation from getting out of control,&#8221; said Margot Vandervelden, WFP&#8217;s acting regional director for West Africa.



Due to the food shortages, malnutrition is alarmingly high, the agencies said, estimating that 16.7 million children under the age of five are acutely malnourished across West and Central Africa.



The region&#8217;s heavy dependence on food imports has tightened the squeeze, particularly for countries battling high inflation such as Ghana, Nigeria, and Sierra Leone.



Policies should be introduced to boost and diversify local food production &#8220;to respond to the unprecedented food and nutrition insecurity,&#8221; said Robert Guei, the FAO&#8217;s Sub-regional Coordinator for West Africa.



(Writing by Alessandra Prentice; Editing by Peter Graff)

WFP warns millions facing hunger as driest weather in decades ravages Horn of Africa

Nearly 55 million people face hunger in West and Central Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-820x547.jpg" alt="" class="wp-image-423556" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/03/IQMT7SFA2RNQLAQHUEOA2VEMMQ-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Illustration photo shows a two-rand coin above a South African flag April 12, 2017. REUTERS/Thomas White/Illustration</figcaption></figure>



JOHANNESBURG, April 12 (Reuters) &#8211; South Africa&#8217;s rand weakened in early trade on Friday against the U.S. dollar, which hovered near a five-month high as traders heavily scaled back bets for a slew of U.S. rate cuts this year.



At 0715 GMT, the rand traded at 18.7550 against the dollar&nbsp;ZAR=D3, about 0.2% weaker than its previous close.



The dollar&nbsp;=USD&nbsp;was trading up almost 0.4% against a basket of global currencies.



&#8220;The geopolitical risks in the Middle East remain high, and this is spurring further demand for the dollar,&#8221; said Andre Cilliers, Currency Strategist at TreasuryONE, estimating that the rand would trade in an 18.65/18.90 range for the day.



There was some positive economic data this week to support the local currency, which has been battered by power cuts and political uncertainty ahead of a May election. South Africa&#8217;s mining and manufacturing output rose in February, and business confidence held steady at an improved level.



On the stock market, the Top-40&nbsp;.JTOPI&nbsp;index was up 0.88% while the broader all-share&nbsp;.JALSH&nbsp;was up 0.78% in early trade.



South Africa&#8217;s benchmark 2030 government bond&nbsp;ZAR2030=&nbsp;was weaker in early deals, with the yield up 2.5 basis points to 10.715%.



(Reporting by Nellie Peyton; Editing by Tomasz Janowski)

Illustration photo of South African rand

South African rand weakens against strong dollar

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-820x547.jpg" alt="" class="wp-image-423316" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/02/F4TO3YKQWNK6NCNXZJUQ2UEGC4-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A man walks past the International Monetary Fund (IMF) logo at its headquarters in Washington, U.S., May 10, 2018. REUTERS/Yuri Gripas/</figcaption></figure>



WASHINGTON, April 11 (Reuters)&nbsp;&#8211;&nbsp;IMF chief Kristalina Georgieva on Thursday said higher U.S. interest rates were not great news for the rest of the world and could become a worry if they continued for a long time, but she thought the U.S. Federal Reserve was acting prudently.



Georgieva, speaking at an event hosted by the Atlantic Council, said the U.S. government could also look at taking other measures to ensure that the U.S. economy was not overheating, but gave no details.



&#8220;Higher interest rates for the rest of the world is not great news. Higher interest rates make the U.S. more attractive so financial flows come here and that leaves the rest of the world somewhat struggling,&#8221; she said.



Higher rates also drove the value of the dollar higher, which meant other countries&#8217; currencies were weaker.



&#8220;If it continues for a long time, it could become a bit of a worry in terms of financial stability,&#8221; she said.



Consumer level inflation data for March released on Wednesday was unexpectedly strong, casting further doubt on the Fed’s current forecast of rate cuts at some point later this year.



The unfavorable price pressure data comes as other reports also pointed to sturdier inflation over the start of the year, challenging the Fed’s most recent projections that penciled in three rate cuts this year.



Minutes from the U.S. Federal Reserve showed officials worried that progress on inflation may have stalled, and a longer period of tight monetary policy would be needed to tame it in the world&#8217;s largest economy.



Investors who had earlier expected a rate cut in June now see September as a likelier timing for the easing cycle to begin, following a third consecutive stronger-than-forecast reading on consumer inflation.



Georgieva said the U.S. economy had been successful because it was more innovative, opening space for entrepreneurship at a time of accelerating technological change.



The U.S. labor market had also held up well, with labor supply boosted by immigration, which in turn helped keep wage growth under control, she said.



The Biden administration&#8217;s Inflation Reduction Act and earlier COVID aid had helped support growth, she said, adding that the International Monetary Fund saw some scope for the U.S. government to address lingering inflation and work toward a soft landing for the economy.



&#8220;So fasten your belts,&#8221; she said. &#8220;At some point we will be landing.&#8221;



(Reporting by Andrea Shalal; Editing by Bill Berkrot)

FILE PHOTO: Man walks past the IMF logo at HQ in Washington

IMF head says higher US rates could become a worry if they persist

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-820x462.jpeg" alt="" class="wp-image-420118" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico.jpeg 929w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The new economic measures laid out by the U.K. government “will likely increase inequality”, according to a spokesperson from the International Monetary Fund.
Yuri Gripas | Reuters</figcaption></figure>



ADDIS ABABA, April 11 (Reuters)&nbsp;&#8211;&nbsp;Ethiopia may have to decide on a big currency devaluation sooner rather than later to secure a rescue loan from the International Monetary Fund (IMF), which left the country last week without reaching a much-needed deal with authorities.



East Africa&#8217;s most populous country, already struggling with high inflation, became the third African state in as many years to default on its debt in December.



Ethiopia hasn&#8217;t received any IMF funds since 2020 and its last lending arrangement with the fund went off track in 2021. The federal government and a rebellious regional authority signed a deal in late 2022 to end a two-year civil war.



The IMF, which said progress was made during its latest visit, has not said that currency reform is necessary for its support. But the Fund usually favours flexible, market-determined exchange rates. Ethiopia has requested $3.5 billion of support from the IMF, sources told Reuters last year.



Chronic foreign currency shortages and a tightly controlled exchange rate has allowed a black market to flourish, on which the birr currently trades at between 117 and 120 per dollar, more than double the official rate of around 56.7&nbsp;ETB=.



&#8220;It seems that the Ethiopian authorities have found accepting the demands of the IMF hard,&#8221; said Abdulmenan Mohammed, an Ethiopian economic analyst based in Britain.



&#8220;The Ethiopian authorities are worried about devaluation of the birr, (which) would have serious negative economic repercussions, including soaring inflation&#8230; and surging foreign currency denominated debts in terms of birr.&#8221;



<h2 class="wp-block-heading" id="h-playing-hardball">&#8216;PLAYING HARDBALL&#8217;</h2>



In early 2021, Ethiopia requested a debt restructuring under the G20&#8217;s Common Framework, a process established in response to the COVID-19 pandemic to bring in newer creditor countries like China and India. But progress was initially delayed by the civil war.



The country&#8217;s external debt was $28.2 billion at the end of March, based on government data.



In August 2023, it secured a debt payments suspension from its largest bilateral creditor China, which from 2006 to 2022 committed to lending the country $14 billion, according to Boston University&#8217;s Chinese Loans to Africa Database.



The rest of Ethiopia&#8217;s bilateral creditors followed suit in December, but said they could cancel the relief if Ethiopia did not get an IMF deal by March 31. When the deadline lapsed, it was extended to June 30.



There are widely varying estimates of the size of currency devaluation the IMF would accept, that could pave the way for a deal.



Irmgard Erasmus of research firm Oxford Economics said that she expects a weakening of 15% to coincide with an IMF staff-level deal on a bailout loan, a prerequisite for its external debt restructuring moving forwards.



&#8220;We retain the view that the IMF will require a good faith measure that solidifies Ethiopia&#8217;s intent to implement a more flexible FX (foreign exchange) regime,&#8221; she said in a note to clients. &#8220;(This) will set the scene for a series of stepwise devaluations on the path to FX liberalisation and monetary policy reform.&#8221;



More than one currency adjustment is likely, the first between 30-50%, said Connor Vasey, a consultant at J.S. Held, pointing to Egypt, which devalued its pound 38% and secured a larger IMF loan in March.



The Ethiopians probably prefer a more gradual devaluation but have a weak negotiating position, Vasey said, after a previous IMF loan programme expired in 2021, amid the conflict and concerns about the country&#8217;s ability to pay its debts.



&#8220;Ethiopia is coming into the meeting room with the IMF that is playing hardball and saying, &#8216;You don&#8217;t really have a foot to stand on, in terms of negotiating down our position,'&#8221; he said.



Nonetheless, Vasey said he expected Ethiopia to secure an IMF deal soon.



&#8220;There&#8217;s an international push to get this all lined up. It&#8217;s just a question of sequencing of the reforms,&#8221; he said.



An IMF spokesperson pointed to comments made earlier this month by spokesperson Julie Kozack, who responded to direct questions on why Ethiopia did not secure a loan during the visit and whether it is likely to get one at the Fund&#8217;s Spring Meetings next week in Washington DC.



&#8220;The team made substantial progress,&#8221; she said. &#8220;These discussions are continuing and will continue at the upcoming Spring Meetings.&#8221;



Ethiopian government officials did not respond to requests for comment. Authorities are committed to FX reform, state finance minister Eyob Tekalign told Reuters in October 2022.



&#8220;The exchange rate unification remains one important policy goal,&#8221; he said at that time. &#8220;But we are just doing it gradually.&#8221;



(Reporting by Rachel Savage in Johannesburg and Dawit Endeshaw in Addis Ababa; Additional reporting by Duncan Miriri in Nairobi, Editing by Karin Strohecker and Jane Merriman)

107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico

Ethiopia faces tough devaluation decision to secure IMF bailout

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="573" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-820x573.jpg" alt="" class="wp-image-475533" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-820x573.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-300x210.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-768x537.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-1536x1074.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/54OZJBBSHVOAZPY7PBW3ZKRWYU-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A seagull flies past a second-hand vehicle trader WeBuyCars Buying Pod in Cape Town, South Africa, April 10, 2024. REUTERS/Esa Alexander/FILE PHOTO</figcaption></figure>



JOHANNESBURG, April 11 (Reuters)&nbsp;&#8211;&nbsp;WeBuyCars made its market debut on Thursday, giving the South African secondhand vehicle trader a market capitalisation of 8.3 billion rand ($441 million) on the Johannesburg Stock Exchange.



Chief Executive Faan van der Walt, standing next to his brother and co-founder Dirk, blew into the African kudu horn as the opening share price of 20 rand was announced on the JSE.



WeBuyCars marks the second JSE listing of 2024, with others including Pick n Pay&#8217;s PIKJ.J discount grocery retailer Boxer, and food producer RCL&#8217;s RCLJ.JRainbow Chicken expressing interest to list at some point.



Shares in WeBuyCars traded as high as 20.85 rand, up from its initial public offering (IPO) price of 18.75 rand.



Van der Walt said the brothers had never imagined listing the family-owned business when they started it in 2001, but now that WeBuyCars was big enough, the time was right.



&#8220;There is still a lot of space for us to grow,&#8221; Van der Walt told Reuters. &#8220;We&#8217;re well positioned, we have the tech, we have the people, we have the footprint so we strongly believe that we can double up again in the next five years,&#8221; he added.



WeBuyCars, which has a market share of 10% to 12% in South Africa is targeting about 23% by 2028, and also aiming to sell 22,000 cars per month, up from 14,000 currently.



With 15 branches and 74 buying pods or kiosks at shopping centres, WeBuyCars plans to open in Rustenburg, Bloemfontein and East London in the near future, Van der Walt said.



WeBuyCars was unbundled from Transaction Capital&nbsp;TCPJ.J&nbsp;and listed separately in order to unlock value and give an option to invest directly in the secondhand car retailer.



Transaction Capital will use the proceeds from various capital raisings to settle holding company level debt.



($1 = 18.8293 rand)



(Reporting by Nqobile Dludla; Editing by Alexander Smith)

South Africa’s second-hand vehicle trader WeBuyCars lists on the Johannesburg Stock Exchange

WeBuyCars marks South African market debut with share price rise

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-820x547.jpg" alt="" class="wp-image-475173" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/VYRWOXIFAFINVMT3XJTBLOGTZQ-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Anna Bjerde, Managing Director for Operations of The World Bank, attends the Asia-Pacific Economic Cooperation (APEC) CEO Summit in San Francisco, California, U.S., November 15, 2023. REUTERS/Carlos Barria/File Photo</figcaption></figure>



WASHINGTON, April 9 (Reuters)&nbsp;&#8211;&nbsp;The World Bank Group&nbsp;unveiled a&nbsp;framework&nbsp;on Tuesday&nbsp;for measuring the results of its development work with 22&nbsp;indicators&nbsp;in what a top official called an important advance in the bank&#8217;s push to increase transparency and accountability.



Anna Bjerde, the World Bank&#8217;s managing director of operations, said&nbsp;the&nbsp;scorecard would allow its shareholders and the people it serves&nbsp;to better&nbsp;see, measure and track the impact of the bank&#8217;s lending and grants.



&#8220;A vision and mission are really great, but unless you can translate it into actions and measure it, then it&#8217;s quite aspirational, and we also want it to be operational,&#8221; Bjerde told&nbsp;Reuters.



The&nbsp;U.S.&nbsp;and other major shareholders have pushed the World Bank&nbsp;to improve how it helps&nbsp;countries address issues such as climate change and pandemic preparedness.



It has already added the phrase &#8220;livable planet&#8221; to its mission statement and reduced the number of its projects to focus on more programmatic and transformational projects.



The scorecard includes 22 global indicators &#8211; down from 150 on a previous instrument &#8211; for poverty, prosperity and a livable planet, as well as themes such as gender equality, inclusion of youth, and how people live in fragile, conflict-affected areas.



It will enable a closer look at development outcomes by adopting a more &#8220;people-centric&#8221; approach, Bjerde said.



For the first time, the work of all World Bank institutions &#8211; including the International Finance Corp and the International Bank for Reconstruction and Development &#8211; will be tracked through the same set of indicators.



“It’s a real game changer, providing a new guidepost that our teams can rally around, and provides full visibility on how well we are tackling the most difficult challenges like poverty, climate change, fragility and food insecurity,&#8221; Bjerde said.



The bank sees the scorecard as part of its push to focus on outcomes, not inputs, for instance by measuring the number of people that actually use financial services, not just how many have access.



The bank is still working out the detailed methodologies to calculate the scores in each of the 22 indicators, she said, with half to be released in June and the rest in October.



The first batch will include data on how many people have access to electricity worldwide, and social safety net programs.



The data will include transparent data broken down by gender, regions, age and whether people are in fragile and conflicted-affected countries.



Drilling in like that will allow the bank, its shareholders and clients to &#8220;see how we&#8217;re doing but also where we need to double down,&#8221; she said.



(Reporting by Andrea Shalal; Editing by Josie Kao)

FILE PHOTO: APEC Summit in San Francisco

World Bank unveils new scorecard to measure accountability

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-820x547.jpg" alt="" class="wp-image-474957" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/Y4ZRO6HDHJLMJN6BQVVOUBSW3M-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: An aerial view shows the headquarters of the Central Bank of Brazil (C) in Brasilia January 20, 2014. REUTERS/Ueslei Marcelino/File Photo</figcaption></figure>



KAMPALA, April 9 (Reuters)&nbsp;&#8211;&nbsp;Uganda&#8217;s foreign exchange reserves fell by about 12% between June 2023 and January this year because of external debt payments and the central bank&#8217;s inability to buy foreign currency due to a slide in the Ugandan shilling&nbsp;UGX=.



Reserves dropped from $4.07 billion in June to about $3.58 billion at the end of January, reaching 3.4 months of import cover excluding oil project-related imports, the central bank said on Tuesday in its State of the Economy report.



The Bank of Uganda targets foreign exchange cover of 4 months of imports, excluding oil projects, an International Monetary Fund staff report published in March said.



Uganda&#8217;s rising public debt, more than half of which is external, has been eating up a growing share of revenues and hitting other spending priorities like education and health.



Total public debt stood at $24.7 billion, 60% of which was external, at the end of 2023, finance ministry figures show.



The Bank of Uganda said foreign reserves could rise due to expected inflows from budget support loans, but that the outlook for the country&#8217;s balance of payments was fragile.



&#8220;Delayed disbursement of expected budget support loans, higher-than-projected government expenditure on imports, and &#8230; tight global and domestic financial market conditions may disrupt the reserve build-up programme,&#8221; it said.



(Reporting by Elias Biryabarema; Editing by Alexander Winning and Alexander Smith)

FILE PHOTO: Aerial view shows the headquarters of the Central Bank of Brazil in Brasilia

Ugandan foreign exchange reserves drop 12% due to debt payments

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="571" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-820x571.jpg" alt="" class="wp-image-474865" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-820x571.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-768x535.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-1536x1070.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/YNH43WBRZBKVHDDQ3KLQGQUX2E-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A girl carries a container of water at a coltan mine in Kamatare, Masisi territory, North Kivu Province of Democratic Republic of Congo, December 1, 2018. REUTERS/Goran Tomasevic/File Photo</figcaption></figure>



JOHANNESBURG/WASHINGTON, April 9 (Reuters)&nbsp;&#8211;&nbsp;The U.S. must boost commercial ties with African countries to curb reliance on China for supplies of critical minerals, a Washington-based think tank said on Tuesday.



&#8220;U.S. economic and national security depend on securing a reliable supply of critical minerals, including from Africa,&#8221; the United States Institute of Peace said in a report.



The U.S. is almost 100% reliant on &#8220;foreign entities of concern,&#8221; mainly China, for key critical minerals, it said, and must come up with own sources of supply to avoid being shorthanded and vulnerable to China&#8217;s export curbs.



Western mining companies are lagging Chinese rivals in the race to tap Africa&#8217;s abundant mineral resources, key to sectors from electric vehicle manufacturing to defence industries.



To counter China&#8217;s head start in Africa, Washington must roll out &#8220;more vigorous commercial diplomacy with a keen eye toward building critical minerals partnership in Africa,&#8221; the 76-page report said.



One option for the U.S. would be to increase commercial diplomacy in countries such as Democratic Republic of Congo, the world&#8217;s No. 1 cobalt supplier, and Zambia, Africa&#8217;s second-largest copper producer, it said.



The competition for securing minerals in Africa is heating up as cash-rich Middle East firms join the race.



While Western mining companies still see hurdles in investing in countries such as Congo, which lacks vital infrastructure such as roads and adequate electricity, Chinese miners have strengthened their grip in the country and are broadening investment throughout Africa.



The International Development Finance Corporation said in February it could scale up project financing in Africa to help reduce the risk of investing in countries including Congo that some investors still perceive as high risk.



Unlocking U.S. investment in Congo could be helped by reopening its consulate in Lubumbashi that closed in the 1990s after the end of the Cold War, Tuesday&#8217;s USIP report said.



The government also needs to prioritize full development of a memorandum of understanding with Congo and Zambia which could help guide U.S. private investors across the battery metals supply chain, it said.



The U.S. has stepped in to back the Lobito Corridor, a rail link from the central African copper belt that&#8217;s key to export of metals through Angola&#8217;s Lobito port.



The U.S. is &#8220;simply not on, or even near, par in competing with China&#8221; for critical minerals investment and diplomacy in Africa, and needs to take a vigorous approach, USIP said.



Jose Fernandez, the U.S. State Department&#8217;s under secretary for economic growth, energy, and the environment said last month the U.S. holds regular talks with Congo state miner Gecamines.



Still, the U.S. government is unlikely to match the resource levels and the mining ecosystem that China wields in winning mining contracts, USIP said, though &#8220;concerted U.S. efforts to land U.S. mining investment in Africa can succeed.&#8221;



(Reporting by Felix Njini in Johannesburg, Ernest Scheyder in Houston and Daphne Psaledakis in WashingtonEditing by Peter Graff)

FILE PHOTO: A girl carries a container of water at a coltan mine in Kamatare, Masisi territory, North Kivu Province of Democratic Republic of Congo

US must boost Africa ties to secure key minerals, report says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="595" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-820x595.jpg" alt="" class="wp-image-474665" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-820x595.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-300x218.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-124x90.jpg 124w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-768x557.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-1536x1114.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/5XI6ICZ6JRKC7A43NJRHTXVLBI-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A wilted maize crop is seen in Mumijo, Buhera district east of the capital Harare, Zimbabwe, March 16, 2024. REUTERS/Philimon Bulawayo/File Photo</figcaption></figure>



HARARE, April 8 (Reuters)&nbsp;&#8211;&nbsp;Mandisireyi Mbirinyu, 70, and her 13-year-old grandson Tinotenda sit in the blistering sun, shelling the few maize cobs they managed to retrieve from land parched by a drought ravaging southern Africa.



&#8220;The grain I have is only enough for the next two months. It is going to be hunger from here on,&#8221; Mbirinyu told Reuters at her farm in Shamva, 90 km (56 miles) north of Zimbabwe&#8217;s capital Harare.



Mbirinyu considers herself lucky. She at least managed to harvest a few bags of maize from her sparsely irrigated plot &#8211; most crops around this area were a write-off.



Southern Africa is reeling from its worst drought in years, owing to a combination of naturally occurring El Nino &#8211; when an abnormal warming of the waters in the eastern Pacific radiates heat into the air leading to hotter weather across the world &#8211; and higher average temperatures produced by greenhouse gas emissions.



Weather across the world produced record-breaking extremes in 2023 as climate change amplified the impacts of El Nino.



A study in October last year even suggested that climate change may now be as significant a factor in triggering El Nino conditions as natural causes like sun rays.



Aid agency Oxfam warned last week that more than 24 million people in southern Africa face hunger, malnutrition and water scarcity because of the drought.



Last season Mbirinyu harvested 14 tonnes of maize and sold some to the national grain company; this year she&#8217;s wondering whether there will be enough to feed her own family.



In neighbouring Malawi, crop theft has become a problem as food sources dry up. In Kuntaja village, near the airport of the commercial capital Blantyre, Osten James makes a living for his family of five by guarding other people&#8217;s maize gardens, after his own were torched by heat.



&#8220;The owners are trying to save the little maize that survived the heat from thieves,&#8221; said James.



Zambia, Malawi and Zimbabwe have all declared a state of disaster.



&#8220;The maize has failed,&#8221; Ulaliya Radson, a Malawian farmer said. &#8220;Last year I harvested 10 bags and as you can see in this field, I won&#8217;t even manage half of that,&#8221; she added, gesturing towards a parched patch.



(Reporting by Nyasha Chingono in Shamva and Frank Phiri in Blantyre; Editing by Tim Cocks, William Maclean)

FILE PHOTO: Villagers collecting food aid in rural Zimbabwe

Southern Africa faces hunger as el Nino drought kills crops

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-820x547.jpg" alt="" class="wp-image-474646" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/OEPY2GFC6ZM3LM7MKO3LBMCKVU-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Central Bank of Nigeria&#8217;s logo is seen on the headquarters building in Abuja, Nigeria January 22, 2018. REUTERS/Afolabi Sotunde</figcaption></figure>



ABUJA, April 8 (Reuters)&nbsp;&#8211;&nbsp;Nigeria&#8217;s central bank has barred commercial lenders from accepting foreign currency-denominated collateral to grant naira loans, a move that could protect the banking system against a strengthening of the local currency, it said on Monday.



The regulator said in a circular that the practice it had observed of bank customers using foreign currency as collateral for naira loans was &#8220;prohibited&#8221;.



The central bank on Monday said it approved Eurobonds issued by the government or letters of credit issued by an offshore bank as eligible foreign currency collateral.



It told lenders to wind down all loans currently secured with dollar-denominated collateral within 90 days or face sanctions.



The naira has gained sharply against the dollar on both the official and parallel markets after suffering its second devaluation in less than a year in January.



The currency strengthened after the central bank raised interest rates in February and March, and lifted restrictions on foreign participation at its fixed-income auctions.



The bank now allows foreign investors to pre-fund their accounts and get naira at the prevailing exchange rate for bill auctions, analysts said.



In the past, lenders faced constraints in fulfilling foreign investors&#8217; bids as they incurred extra costs on settlement day if they borrowed from the central bank&#8217;s discount window to pay for bills.



(Reporting by Chijioke Ohuocha; Editing by Alison Williams and Jan Harvey)

Central Bank of Nigeria’s logo is seen on the headquarters building in Abuja

Nigeria bars lenders from using FX-denominated collateral for naira loans

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="600" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-820x600.jpg" alt="" class="wp-image-474643" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-820x600.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-300x220.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-123x90.jpg 123w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-768x562.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-1536x1124.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/04/7EUCZ6RKSVIQDGLZGVKYD2BO74-scaled.jpg 2048w" sizes="(max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A woman walks past the Reserve Bank of Zimbabwe building in Harare, Zimbabwe March 1, 2024. REUTERS/Philimon Bulawayo/FILE PHOTO</figcaption></figure>



HARARE, April 8 (Reuters)&nbsp;&#8211;&nbsp;Zimbabwe&#8217;s new gold-backed currency started trading on Monday amid doubts that the country&#8217;s third such re-launch in a decade will have any more success in ending repeated, crippling bouts of high inflation.



The Zimbabwe Gold (ZiG) was announced on Friday by the central bank with an initial rate of 13.56 to $1, replacing the Real Time Gross Settlement Dollar (RTGS), which had lost about 80% of its value this year and had been trading at 28,720 to $1 before the change.



Bank balances were transferred into the new currency over the weekend while their customers will have 21 days to do so, and the new banknotes will enter circulation at the end of this month, according to the Reserve Bank of Zimbabwe.



The RTGS, also known as the Zimdollar&nbsp;ZWL=, was launched in 2019 after a decade of dollarisation, which included so-called bond coins and bond notes, notionally pegged to the U.S. dollar and introduced in 2014 and 2016 respectively.



However, the Zimdollar struggled to gain trust and this year&#8217;s precipitous slide pushed annual inflation above 55% in March&nbsp;ZMBCPY=ECI, raising fears of a return to the 2007-2009 era of hyperinflation under former president Robert Mugabe.



&#8220;There was dire need for drastic change in the Zimbabwean monetary system,&#8221; Jacques Nel at research firm Oxford Economics said in a note to clients.



The central bank statement on Friday correctly identified the most pressing problems, said Nel.



&#8220;A lack of credibility in both the domestic currency and the framework that governed it &#8211; but it is that same lack of credibility that casts doubt over the effectiveness of these new measures,&#8221; he added.



Commercial banks were using the new official exchange rate on Monday, according to Reuters enquiries. It was not immediately clear whether the currency, which the central bank described as &#8220;structured&#8221; and &#8220;anchored by a composite basket of foreign currency and precious metals (mainly gold) held as reserves&#8221;, would be able to retain this value.



Nor was it given that companies and citizens would accept it as a form of payment and a store of value. Some 80% to 85% of transactions are currently carried out in foreign currencies, according to the central bank.



&#8220;Zimbabwe has an insufficient $285 million of hard currency and gold reserves,&#8221; Hasnain Malaik of research firm Tellimer said in a note. &#8220;To fix the economy, Zimbabwe needs to address these root causes of its problems.&#8221;



These problems include central bank funding of government, unsustainable fiscal deficits, debt arrears and Western sanctions, and Malaik said it was not clear whether any would be addressed under the current ruling ZANU-PF party.



(Reporting by Nyasha Chingono and Rachel Savage, Editing by Karin Strohecker and Tomasz Janowski)

Reuters

IMF Board backs key change to lending-into-official-arrears policy

South Africa inflation slows slightly more than expected in March

Tanzania, Rwanda, Zimbabwe join African recall of J&J cough syrup

World Bank sounds alarm on ‘historical reversal’ of development for poorest nations

Nigeria’s grid collapses weeks after tariffs raised for wealthier consumers

Ghana fails to reach debt deal with international bondholders

Nearly 55 million people face hunger in West and Central Africa

South African rand weakens against strong dollar

IMF head says higher US rates could become a worry if they persist

Ethiopia faces tough devaluation decision to secure IMF bailout

WeBuyCars marks South African market debut with share price rise

World Bank unveils new scorecard to measure accountability

Ugandan foreign exchange reserves drop 12% due to debt payments

US must boost Africa ties to secure key minerals, report says

Southern Africa faces hunger as el Nino drought kills crops

Nigeria bars lenders from using FX-denominated collateral for naira loans

Zimbabwe’s new ZiG currency starts trading, credibility doubts linger

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Advertise With Us

Reuters

IMF Board backs key change to lending-into-official-arrears policy

South Africa inflation slows slightly more than expected in March

Tanzania, Rwanda, Zimbabwe join African recall of J&J cough syrup

World Bank sounds alarm on ‘historical reversal’ of development for poorest nations

Nigeria’s grid collapses weeks after tariffs raised for wealthier consumers

Ghana fails to reach debt deal with international bondholders

Nearly 55 million people face hunger in West and Central Africa

South African rand weakens against strong dollar

IMF head says higher US rates could become a worry if they persist

Ethiopia faces tough devaluation decision to secure IMF bailout

WeBuyCars marks South African market debut with share price rise

World Bank unveils new scorecard to measure accountability

Ugandan foreign exchange reserves drop 12% due to debt payments

US must boost Africa ties to secure key minerals, report says

Southern Africa faces hunger as el Nino drought kills crops

Nigeria bars lenders from using FX-denominated collateral for naira loans

Zimbabwe’s new ZiG currency starts trading, credibility doubts linger

News Tips

Advertise With Us

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