<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="756" height="426" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/Power-lines-Reuters.png" alt="" class="wp-image-494651" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/Power-lines-Reuters.png 756w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/Power-lines-Reuters-300x169.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/Power-lines-Reuters-160x90.png 160w" sizes="auto, (max-width: 756px) 100vw, 756px" /></figure>



KAMPALA, June 7 (Reuters)&nbsp;&#8211;&nbsp;Uganda suffered a rare nationwide electricity blackout for several hours on Friday, its state-run power grid operator said, adding that electricity was gradually being restored late in the afternoon.



The grid shutdown happened during the testing a newly completed, Chinese-built $1.5 billion 600 megawatt hydropower plant on the Nile river in the country&#8217;s north, Uganda Electricity Transmission Company Limited (UETCL) said in a post on X platform.



&#8220;Uganda Electricity Transmission Company Limited informs the general public that a national blackout has been registered following a load rejection test at the Karuma hydro power plant,&#8221; the company posted on X on Friday.



In another post about two hours later, it said the grid had been restored partially.



Uganda has an installed power generation capacity of 2,000 MW, according to the energy ministry. It generates more power than it consumes and has been exploring the possibility of exporting the surplus to neighbours like South Sudan and Kenya.



(Reporting by Elias Biryabarema; Editing George Obulutsa, William Maclean)

Power-lines-Reuters

Uganda hit by nationwide blackout for several hours, grid operator says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="566" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-820x566.jpg" alt="" class="wp-image-494648" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-820x566.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-300x207.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-130x90.jpg 130w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-768x530.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-1536x1060.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6O6UNTB5OFO33C2TUIUM7RPBLY-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Sybil Esth, a Sierra Leonean migrant, repatriated from Algeria six months ago, looks on while holding her child in Agadez, Niger, April 23, 2024. REUTERS/Stringer</figcaption></figure>



NAIROBI, June 7 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s parliament has approved government spending of 4.00 trillion shillings ($31.01 billion) in the fiscal year that starts in July, up from the 3.75 trillion shillings it approved last June for the current fiscal year.



The finance ministry is due to present the final version of the budget next week, with slight variations expected to the proposed amount of spending.



&#8220;This house &#8230; will be approving a budget &#8230; of 4.006 trillion shillings,&#8221; Ndindi Nyoro, chairperson of parliament&#8217;s Budget and Appropriations Committee, said on Thursday ahead of the approval.



The 2024/25 budget will be presented alongside a highly contested piece of draft legislation, the Finance Bill 2024.



The bill proposes tax changes aimed at increasing revenue collection, but critics say it could cripple sectors ranging from financial services and manufacturing to retail.



President William Ruto defends the tax measures as necessary to curb the country&#8217;s reliance on borrowing and fund spending priorities.



($1 = 129.0000 Kenyan shillings)



(Reporting by George Obulutsa; Editing by Alexander Winning)

Migrants wait for their departure to Libya in Agadez

Kenya parliament approves $31 bln government spending next fiscal year

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



NAIROBI, June 7 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Friday.



<h2 class="wp-block-heading" id="h-events">EVENTS:</h2>



A financial sector trade union representing workers in banks, insurance companies and other businesses has called for a two-day protest strike following the arrest of its secretary-general.



Niger court will debate about a possible lifting of ousted President Mohamed Bazoum&#8217;s immunity and his incarceration.



The United States and Kenya are due to hold their sixth in-person negotiating round under the Strategic Trade and Investment Partnership (STIP) in Mombasa, Kenya.



Mauritius&#8217; Finance Minister Renganaden Padayachy is due to present the 2024/25(July-June) budget to parliament.



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



Asian stocks are set to snap a two-week losing streak on Friday after major central banks kick-started their rate easing cycle this week, adding to expectations the U.S. Federal Reserve could soon follow suit.



[MKTS/GLOB]



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



Oil prices ticked higher on Friday, as reassurances from OPEC+ members Saudi Arabia and Russia indicating readiness to pause or reverse output agreements, but markets were headed for their third straight weekly losses.



[O/R]



<h2 class="wp-block-heading" id="h-african-markets">AFRICAN MARKETS</h2>



The Nigerian and Kenyan currencies are expected to fall over the next week to Thursday, while Zambia&#8217;s and Ghana&#8217;s are seen trading relatively stable and Uganda&#8217;s could gain, traders said.



<h2 class="wp-block-heading" id="h-south-africa-markets">SOUTH AFRICA MARKETS</h2>



South Africa&#8217;s rand was steady on Thursday, as markets awaited the outcome of a meeting between senior African National Congress (ANC) leadership figures on the future of the country&#8217;s government.



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



Kenya&#8217;s shilling gained ground on Thursday, helped by commercial banks selling off their long dollar positions, traders said.



<h2 class="wp-block-heading" id="h-kenya-rates">KENYA RATES</h2>



Kenya&#8217;s central bank held its benchmark lending rate at 13.0% on Wednesday, saying inflation was stable within its near-term target range, and it aimed to keep exchange rate stability.



<h2 class="wp-block-heading" id="h-sudan-politics">SUDAN POLITICS</h2>



Sudan&#8217;s army said on Thursday it would deliver a &#8220;harsh response&#8221; to an attack a day earlier on a village by the Sudanese paramilitary Rapid Support Forces that pro-democracy activists said killed more than 100 people.



<h2 class="wp-block-heading" id="h-climate-change-africa">CLIMATE CHANGE AFRICA</h2>



A group of 10 West African countries has weighed into a debate over whether companies around the world should be allowed to use carbon offsets to cut emissions, arguing they are critical to attracting financing for climate and conservation efforts.



<h2 class="wp-block-heading" id="h-nigeria-fidelity-bank">NIGERIA FIDELITY BANK</h2>



Nigeria&#8217;s Fidelity Bank said on Thursday it would raise up to 127.1 billion naira ($88 million) via a rights issue and a public share offering to comply with a new minimum capital requirement for local lenders introduced by the central bank in March.



((Compiled by Nairobi Newsroom))

World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on June 7

<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="auto, (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, June 7 (Reuters)&nbsp;&#8211;&nbsp;The South African rand was stronger in early trade on Friday, after the African National Congress (ANC) said it would seek to form a government of national unity after failing to win a majority in last week&#8217;s election.



At 0712 GMT, the rand traded at 18.88 against the dollar&nbsp;ZAR=D3, around 0.6% stronger than its previous close.



ANC leader Cyril Ramaphosa said late on Thursday that the former liberation movement would invite other political parties to form a government of national unity (GNU), a similar arrangement to the one after 1994&#8217;s historic all-race vote that ended apartheid.



The ANC said it had already held constructive talks with parties including the far-left Economic Freedom Fighters (EFF) and pro-business Democratic Alliance (DA).



&#8220;The rand is trading marginally firmer this morning in cautious trade as markets await the exact makeup of the GNU and what parties will be involved,&#8221; said Andre Cilliers, currency strategist at TreasuryONE.



&#8220;Trading conditions will remain on the volatile side as traders turn cautious and liquidity dries up a bit.&#8221;



The ANC is expected to brief the media later on Friday on the outcomes of Thursday&#8217;s National Executive Committee meeting.



On Friday the rand could also take its direction from U.S. jobs data.



In domestic economic data, South Africa&#8217;s net foreign reserves rose to $58.287 billion at the end of May, from $57.851 billion in April, central bank data showed.



The benchmark 2030 government bond&nbsp;ZAR2030=&nbsp;was firmer in early deals, the yield down 3 basis points to 10.615%.



(Reporting by Tannur Anders; Editing by Alexander Winning)

Illustration photo of South African rand

South African rand gains after ANC says it seeks unity government

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-820x547.jpg" alt="" class="wp-image-494387" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2153716937-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Delegations are being seen at the World Bank Group exhibition booth at The 10th World Water Forum 2024 in Nusa Dua, Bali, Indonesia, on May 23, 2024. The 10th World Water Forum from May 18 to 25, 2024, is serving as a platform for dialogue to create solutions to global water management issues. (Photo by Johanes P. Christo/NurPhoto via Getty Images)</figcaption></figure>



NAIROBI, June 6 (Reuters)&nbsp;&#8211;&nbsp;Kenya plans to use part of a World Bank budget support loan to make a payment of roughly $500 million on a Eurobond maturing this month, its central bank governor said on Thursday.



The East African country sold a $1.5 billion international bond in February at great cost to fund the buyback of a large portion of the $2 billion bond maturing in June.



Before that, investors had feared Kenya might not be able to repay the bond due to its strained public finances.



&#8220;We do expect some disbursements from the World Bank of about $1.2 billion related to the development policy operations. Part of that &#8230; will be used to settle the $500 million of the remaining Eurobond,&#8221; Central Bank of Kenya Governor Kamau Thugge told a news conference.



Asked about a World Bank report that said the government was planning another buyback later this year, Thugge said the bank was still in discussions with the Treasury.



He said the central bank was sticking to its economic growth forecast of 5.7% this year, despite recent flooding, as the services sector was resilient and agriculture performing well.



Kenya&#8217;s economy is estimated to have grown 5.8% in the first quarter of this year, after 2023 growth of 5.6%.



On Wednesday, the central bank held its benchmark lending rate KECBIR=ECI at 13.0%, saying the current stance would ensure that inflation remained stable around the mid-point of its target range in the near term.



In response to a questions about when rates would go down, Thugge said the bank would look at external developments before deciding what direction its benchmark rate would take at the appropriate time.



(Reporting by George Obulutsa; Editing by Alexander Winning)

The 10th World Water Forum In Bali

Kenya to use World Bank loan to make $500 mln bond payment this month

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



June 6 (Reuters)&nbsp;&#8211;&nbsp;Emerging market equities extended gains on Thursday, as soft U.S. labour market data renewed bets of an interest rate cut by the Federal Reserve this year, while investors assessed the political path in major economies following a slew of elections.



The MSCI&#8217;s index of EM equities .MSCIEF climbed 0.9%, rising for a second session as U.S. Treasury yields came under pressure after data pointed to a moderating labour market.



The dollar slipped against major currencies as investors priced in nearly 50 basis points of rate cuts from the Fed this year, with the first expected to come in September.



The South African rand&nbsp;ZAR=D3&nbsp;rose slightly to 18.89 per dollar, after touching a six-week low on Wednesday on concerns about who the African National Congress would form a coalition with, after it lost its majority for the first time in 30 years in last week&#8217;s election.



The ANC is leaning towards trying to form a government of national unity for South Africa, it&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL1N3I30PF&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">said</a>&nbsp;on Wednesday, but the second-largest party said it would not join a government that included some of its smaller rivals.



&#8220;The option of a coalition with EFF (Economic Freedom Fighters) and MK (uMkhonto we Sizwe) implies a big shift&#8230;many things will be very complicated for the mining sector that will have a big cost for the budget,&#8221; said Sergi Lanau, director of global EM strategy at Oxford Economics.



&#8220;If it&#8217;s with the Democratic Alliance and other small parties, then it&#8217;s a government that mixes a bit of everything. It would be a relief for markets and over the next few years it would most likely be a status quo.&#8221;



The Indian rupee&nbsp;INR=&nbsp;slipped, while the Mexican peso&nbsp;MXN=&nbsp;strengthened in volatile trading sparked by their respective election outcomes this week.



In Central and Eastern Europe, the Hungarian forint EURHUF= and the Polish zloty EURPLN= dipped against the euro ahead of the European Central Bank&#8217;s policy decision, which is widely expected to be a rate cut.



Currencies in the region hit multi-month or multi-year highs in May amid signs of an economic recovery as central banks continue to pause or look to slow interest rate cuts.



Poland&#8217;s central bank left its main interest rate on hold at 5.75% on Wednesday as expected. The National Bank of Poland&#8217;s Governor Adam Glapinski is set to host a press conference later in the day.



Stock markets in Budapest&nbsp;.BUX, Warsaw&nbsp;WIG20&nbsp;and Prague&nbsp;.PX&nbsp;rose marginally, tracking a positive mood in Europe.



(Reporting by Sruthi Shankar in Bengaluru; Editing by Rashmi Aich)

EM equities extend gains; South Africa politics in focus

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="530" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-820x530.jpg" alt="" class="wp-image-433145" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-820x530.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-300x194.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-139x90.jpg 139w, https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-768x497.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A-1536x994.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/12/XRWAJLZOAVK3DL2J5JMRWBBQ6A.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A general view shows the Central Bank of Kenya headquarters building along Haile Selassie Avenue in Nairobi, Kenya November 28, 2018. REUTERS/Njeri Mwangi/</figcaption></figure>



NAIROBI, June 6 (Reuters)&nbsp;&#8211;&nbsp;Kenya&#8217;s central bank is sticking to its 5.7% economic growth forecast for this year despite recent floods, its governor said on Thursday.



&#8220;Despite the recent flooding in some parts of the country, the economy is expected to remain strong in 2024 supported by the resilient services sector and robust performance of the agricultural sector,&#8221; Governor Kamau Thugge told a news conference.



Thugge added that the&nbsp;East African economy was&nbsp;estimated to have grown 5.8% in the first quarter of this year.&nbsp;Last year the economy grew 5.6%.



On Wednesday the central bank held its benchmark lending rate KECBIR=ECI at 13.0%, saying its current stance would ensure that inflation remained stable around the mid-point of its target range in the near term.



(Reporting by George Obulutsa; Editing by Tomasz Janowski and Alexander Winning)

XRWAJLZOAVK3DL2J5JMRWBBQ6A

Kenya’s central bank sticks to 5.7% growth forecast for this year despite floods

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="560" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-820x560.jpg" alt="" class="wp-image-494353" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-820x560.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-300x205.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-132x90.jpg 132w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-768x524.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-1536x1049.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/D7BPO7626ZOYRDBIVIP4MZP3IY-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A truck drives amongst workings at the De Beers Voorspoed Diamond mine near Kroonstad, South Africa May 3, 2017. REUTERS/James Oatway/File Photo</figcaption></figure>



JOHANNESBURG, June 6 (Reuters)&nbsp;&#8211;&nbsp;The Botswana government may raise its shareholding in global diamond miner De Beers, President Mokgweetsi Masisi told JCK News, after parent company Anglo American&nbsp;AAL.L&nbsp;said it plans to spin off or sell the business.



The government owns a 15% stake in De Beers and Botswana accounts for 70% of the company&#8217;s annual rough diamond supply.



Anglo outlined a radical review of its business including a sale or divestment of the diamond business to focus on copper, iron ore and a fertilizer project in the UK to fend off a takeover from bigger rival BHP Group BHP.AX .



Masisi told JCK in Las Vegas that Anglo&#8217;s sale of De Beers would be &#8220;the best thing&#8221; if it happens.



The government could raise its shareholding in De Beers &#8220;if it&#8217;s attractive to,&#8221; Masisi told the online diamond news channel. The president in May told CNBC Africa that government would defend its interests in the diamond miner.



Among the plans Anglo could consider is an initial public offering for the diamond business, Reuters reported on May 14, citing sources.



Like other luxury goods, diamond prices have been hammered by a slump in global demand. De Beers has been limiting supply and offering flexibility to contracted customers. In February, Anglo announced a $1.6 billion impairment charge on De Beers. Anglo acquired De Beers in 2011, buying the Oppenheimer family&#8217;s 40% stake for $5.1 billion.



Masisi told JCK News Botswana&#8217;s ideal partner in De Beers would be a long-term investor. The government will try to keep the &#8220;bad guys out&#8221; and wants investors whose vision is aligned with the government&#8217;s.



&#8220;One of the characteristics of a bad owner is someone who has impatient capital,&#8221; Masisi said. &#8220;This industry requires somebody who is in it for the long-haul, because it has its ups and downs.&#8221;



(Reporting by Felix Njini; Additional reporting by Clara Denina. Editing by Jane Merriman)

FILE PHOTO: A truck drives amongst workings at the De Beers Voorspoed Diamond mine near Kroonstad

Botswana may raise De Beers stake as Anglo weighs spin-off

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-820x461.jpeg" alt="" class="wp-image-494337" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546-1536x864.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/107402021-1713288153679-gettyimages-648951146-dsc_7546.jpeg 1600w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Median CEO pay hit $16.3 million in 2023, or nearly 200 times the typical worker’s wages for the year, according to data analyzed for The Associated Press by Equilar.



Typical compensation packages for chief executives who run companies in the S&amp;P 500 rose nearly 13% last year, the AP reports. And roughly two dozen chief executives in the survey saw a pay bump of 50% or more.



Workers, on the other hand, saw wages rise by 5.2% in the last year, just above the rate of inflation, with some of the biggest gains going toward the lowest-paid workers. The median S&amp;P 500 employee earned $81,467 in 2023.



<h2 class="wp-block-heading" id="h-a-widening-ceo-to-worker-pay-gap">A widening CEO-to-worker pay gap</h2>



The CEO-to-worker pay gap grew in the last year as company boards scrambled to keep executives from quitting and businesses fared well in the stock market. In 2022, CEOs made roughly 185 times their typical worker; with the jump in 2023 numbers, CEOs now make roughly 196 times their employees.



The disparity is largely driven by the fact that many top executives are paid based on how well their company performs, and stock awards make up roughly 70% of their total compensation packages.



CEO pay is generally decided on by shareholders, who in the last four years have overwhelmingly voted in support of executive compensation plans, according to Equilar data.



Top bosses haven’t always made so much more than their workforce.



CEO pay has increased by 1,209% since 1978, compared with an 15% bump for the typical worker over this time period, according to the left-leaning Economic Policy Institute.



Typical worker wages have not increased as fast as CEO pay for a number of reasons, says Lawrence Mishel, a distinguished fellow at the EPI: high unemployment, globalization, the erosion of unions, low labor standards, the increase in noncompete clauses and domestic outsourcing, like shifting to a workforce of freelancers. Notably, the Federal Trade Commission recently voted to ban noncompete clauses, which impacts some 30 million American workers, though the move is facing legal action from business groups.



Whether CEOs are overpaid is “really up to shareholders to decide,” says Amit Batish, the senior director of content and communications at Equilar.



“One may argue that paying a CEO adequately is critical to the success of an organization, ensuring long-term stability and growth, particularly during economic downturns,” Batish tells CNBC Make It. If certain performance goals, especially financial growth, aren’t met, shareholders might express their dissatisfaction by cutting compensation.



As it stands now, Batish expects CEO pay to continue to outpace growth in median worker pay but notes that CEO stock compensation isn’t a guarantee — CEOs may not be able to cash in on their stock awards for years, if at all, unless they meet certain targets in their stock value or operating profits. Meanwhile, median employee pay is in cash salaries and bonuses, “making the comparison difficult at times.”



That being said, “the value of stock awards can also appreciate over time, bringing even more value to executives, while the value of cash for employees contends with inflation,” Batish says.



This widening gap could be a reason why Americans are dissatisfied with the economy, says Sarah Anderson, who directs the Global Economy Project at the progressive Institute for Policy Studies.



“Most of the focus here is on inflation, which people are really feeling, but they’re feeling the pain of inflation more because they’re not seeing their wages go up enough,” Anderson told the AP.



<h2 class="wp-block-heading" id="h-the-highest-paid-ceos"><a></a>The highest-paid CEOs</h2>



The highest-paid CEOs are concentrated in the communication services industry, the consumer defensive industry and health care. The CEO-to-worker pay gap is highest for retailers and other businesses where employees earn lower hourly wages.



The top-paid CEOs in the S&amp;P 500, according to the AP survey, include Hock Tan of Broadcom Inc., with a compensation package valued close to $162 million; William Lansing of Fair Isaac Corp, or FICO ($66.3 million); Tim Cook of Apple Inc. ($63.2 million); Hamid Moghadam of Prologis Inc. ($50.9 million); and Ted Sarandos, co-CEO of Netflix ($49.8 million).



Of the 341 CEOs included in the data, 25 are women. The highest-paid female CEOs include Lisa Su of Advanced Micro Devices ($30.3 million); Mary Barra of General Motors ($27.8 million); and Jane Fraser of Citigroup ($25.5 million).

107402021-1713288153679-gettyimages-648951146-dsc_7546

The typical CEO makes nearly 200 times more than their workers

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-820x547.jpg" alt="" class="wp-image-494333" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/EYYBONFVFVOUPBL7XNUPPRYTNI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: President of the African National Congress (ANC) Cyril Ramaphosa delivers an address to supporters during the political party’s final rally ahead of the upcoming election at FNB stadium in Johannesburg, South Africa, May 25, 2024. REUTERS/Alaister Russell/File Photo</figcaption></figure>



JOHANNESBURG, June 6 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s rand made a slight recovery early on Thursday, having slipped the day before when the African National Congress (ANC) said it would try to form a government of national unity following last week&#8217;s election.



At 0715 GMT, the rand traded at 18.90 against the dollar&nbsp;ZAR=D3, 0.2% stronger than its previous close.



The ANC lost its majority in the May 29 election for the first time since coming to power 30 years ago. It said on Wednesday that it had met with all interested parties keen to contribute ideas to form a government.



The party&#8217;s National Executive Committee will hold high-stakes internal talks later on Thursday to discuss options.



&#8220;Traders are likely to remain on edge until there is some certainty on the way forward, and we expect trading in the Rand to be fairly volatile and headline-driven in the short term,&#8221; said Andre Cilliers, currency strategist at TreasuryONE.



On the stock market, the Top-40&nbsp;.JTOPI&nbsp;index was up 0.1% in early trade.



South Africa&#8217;s benchmark 2030 government bond&nbsp;ZAR2030=&nbsp;was stronger in early trade, with the yield down 12 basis points at 10.610%.



(Reporting by Bhargav Acharya; Editing by Christina Fincher)

FILE PHOTO: President of the ANC Cyril Ramaphosa attends a rally ahead of the upcoming election at FNB stadium in Johannesburg

South African rand edges higher with focus on ANC talks

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="536" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-820x536.jpg" alt="" class="wp-image-494166" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-820x536.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-300x196.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-138x90.jpg 138w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-768x502.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-1536x1003.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/PPA7LZHDAZIPJMJ7KHMLZAMWME-2-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A view shows the logo of South Africa&#8217;s central reserve bank, at the reserve bank offices in Pretoria, South Africa, January 26, 2023. REUTERS/Siphiwe Sibeko</figcaption></figure>



JOHANNESBURG, June 5 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s central bank said on Wednesday it expected the country&#8217;s financial system to remain resilient despite risks from worldwide elections, persistent geo-political tensions and weak domestic market conditions.



With more than 70 countries going to the polls this year &#8211; among them South Africa last month &#8211; the South African Reserve Bank said the possible changes in policy that might result had heightened market volatility.



The governing African National Congress (ANC) lost its majority for the first time in three decades in national and provincial elections on May 29.



The ANC said on Wednesday that it was leaning towards a government of national unity with several parties, which last happened at the fall of apartheid in 1994.



The rand has traded erratically since last week as news of the election outcomes filtered through to investors.



At 1331 GMT, the rand traded at 18.89 against the dollar ZAR=D3, around 0.9% weaker than its previous close after a press conference by the ANC where the party discussed its future path.



The party has held discussions with the business friendly Democratic Alliance and radical left Economic Freedom Fighters, among others.



The central bank said in the first edition of its Financial Stability Review, the biannual health check of the financial system, that high exposure to government debt and the weak fiscal position overall, undermined market resilience.



Steady progress had been made to strengthen the domestic financial safety net through the introduction of deposit insurance and a broader financial sector stress-test which included banks and insurance companies, the central bank said.



Globally, geo-political tensions and stickier inflation meant some economies were experiencing divergent recoveries, increasing market volatility.



Despite these risks, the central bank said it expected the financial system to remain resilient over the forecast period to May 2025.



(Reporting by Kopano Gumbi; Editing by Tannur Anders and Philippa Fletcher)

South Africa trims rate hikes as power cuts slash growth prospects

South Africa’s financial system stable despite headwinds, central bank says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="555" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-820x555.jpg" alt="" class="wp-image-494118" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-820x555.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-300x203.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-133x90.jpg 133w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-768x520.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM-1536x1039.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/MZUR3KWFJZK6VCE3ZP6JUOG6AM.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Kenya&#8217;s President William Ruto delivers a national statement at the World Climate Action Summit during the United Nations Climate Change Conference (COP28) in Dubai, United Arab Emirates, December 1, 2023. REUTERS/Thaier Al Sudani/File Photo</figcaption></figure>



NAIROBI, June 5 (Reuters)&nbsp;&#8211;&nbsp;Kenya plans to carry out another Eurobond buyback this year, which would bring the total amount of debt it has bought back in 2024 to about $2.5 billion, the World Bank said.



In February, Kenya&#8217;s government said it would buy back more than $1.4 billion of its $2 billion Eurobond maturing in June via a tender offer launched that month for a new bond.



The government&nbsp;said at the time&nbsp;the new bond would amortise in three equal instalments in 2029, 2030 and 2031, giving a weighted average tenure of six years.



It means that, by the end of June, Kenya will have to pay another $557 million to clear the $2 billion Eurobond.



The World Bank said Kenya&#8217;s government would have to be proactive in its liability management and focus on concessional borrowing to reduce its interest costs and amortisation pressure, especially between 2028 and 2031, to forestall future liquidity squeezes.



&#8220;To this end, the GoK (government) is considering another Eurobond buyback in 2024, bringing the total 2024 buyback



to approximately $2.5 billion, smoothing the amortisation profile&#8230;&#8221; the World Bank said in a report released last week after approving a&nbsp;$1.2 billion loan&nbsp;for Kenya.



&#8220;In addition, the GoK is considering liability management by leveraging sustainability instruments like debt swaps and sustainability-linked bonds.&#8221;



The shilling and stocks on the Kenyan bourse rallied in February, helped by increased confidence after the government sold the new&nbsp;Eurobond.



In a separate economic update on Kenya released on Wednesday, the bank forecast the economy would expand 5% this year after growing 5.6% in 2023.



(Reporting by George Obulutsa; Editing by Christina Fincher)

MZUR3KWFJZK6VCE3ZP6JUOG6AM

Kenya plans second Eurobond buyback in 2024, World Bank says

<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="auto, (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, June 5 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s rand edged higher early on Wednesday, as focus remained on which coalition partner the African National Congress (ANC) would choose after losing its majority for the first time in last week&#8217;s election.



At 0650 GMT, the rand traded at 18.6875 against the dollar&nbsp;ZAR=D3, 0.16% stronger than its previous close.



The ANC is set to hold high-stakes internal discussions on Wednesday as coalition talks get underway. The party of liberation hero Nelson Mandela could partner with either the business friendly Democratic Alliance or the radical left Economic Freedom Fighters.



&#8220;Investors will require some positive news from the coalition discussions that will ease concerns about the sustainability of SA&#8217;s (South Africa&#8217;s) economy,&#8221; ETM Analytics said in a research note.



Domestic focus will also be on the S&amp;P Global, which will release its whole-economy purchasing managers&#8217; index survey at 0715 GMT, which will shed light on business conditions in Africa&#8217;s most industrialised economy in May.



South Africa&#8217;s benchmark 2030 government bond&nbsp;ZAR2030=&nbsp;was marginally weaker in early deals, with the yield up 0.5 basis point to 10.580%.



(Reporting by Bhargav Acharya; Editing by Andrew Heavens)

South African rand edges higher with focus on ANC coalition talks

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-820x547.jpg" alt="" class="wp-image-494062" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/DILFJA7KOJJ4VATMVNSVVR47UU-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Mauritanian President Mohamed Ould Cheikh El Ghazouani speaks as South Korean President Yoon Suk Yeol looks on during a joint news conference during 2024 Korea-Africa Summit in Goyang, South Korea, June 4, 2024. REUTERS/Kim Hong-Ji</figcaption></figure>



SEOUL, June 5 (Reuters)&nbsp;&#8211;&nbsp;Nearly 50 deals and agreements have been signed during South Korea&#8217;s first summit with leaders from 48 African countries to cooperate in areas such as mining, energy and manufacturing, South Korea&#8217;s industry ministry said on Wednesday.



Hyosung Corp&nbsp;004800.KS, a South Korean conglomerate, signed a contract to supply electric transformers to Mozambique worth $30 million, the ministry said in a statement.



The industry ministry also signed agreements to cooperate on critical minerals with Madagascar and Tanzania in order to secure supplies for industries such as batteries, it said.



The 47 agreements with 23 African countries were made during the summit as Asia&#8217;s fourth-largest economy seeks to tap the minerals and the vast export market in Africa.



&#8220;Despite its enormous potential, Africa still accounts for only 1-2% of South Korea&#8217;s trade and investment..,&#8221; South Korean President Yoon Suk Yeol told a gathering of about 200 political and industry leaders from African countries and South Korea at a business summit on Wednesday.



&#8220;My hope is that mutually beneficial resource cooperation will be expanded,&#8221; Yoon said.



Yoon pledged on Tuesday that South Korea would increase development aid for Africa to $10 billion over the next six years, and said will offer $14 billion in export financing to promote trade and investment for South Korean companies in Africa.



(Reporting by Joyce Lee; Editing by Ed Davies)

Mauritanian President Mohamed Ould Cheikh El Ghazouani speaks as South Korean President Yoon Suk Yeol looks on during a joint news conference during 2024 Korea-Africa Summit in Goyang

South Korea, African countries sign agreements on minerals, exports

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-820x547.jpg" alt="" class="wp-image-493882" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">International Monetary Fund (IMF) logo is seen outside the headquarters building in Washington, U.S., as IMF Managing Director Christine Lagarde meets with Argentine Treasury Minister Nicolas Dujovne September 4, 2018. REUTERS/Yuri Gripas</figcaption></figure>



LUSAKA, June 4 (Reuters)&nbsp;&#8211;&nbsp;The International Monetary Fund (IMF) said on Tuesday that Zambia&#8217;s government had asked for its $1.3 billion loan programme to be increased to $1.7 billion to help it respond to a severe drought.



The IMF also said in a statement that it had reached a staff-level agreement on the third review of the southern African country&#8217;s Extended Credit Facility.



Once the latest review is approved by IMF&#8217;s executive board at a meeting expected by the end of June, Zambia will have access to roughly $573 million, the fourth disbursement under the facility.



Zambia is one of a handful of African countries grappling with a drought induced by the El Niño weather phenomenon that has plunged parts of the region into hunger.



The copper-rich country is close to emerging from a debt-restructuring process beset by delays after more than three and a half years.



Zambia&#8217;s finance ministry said last week that more than 90% of holders of its $3 billion in outstanding international bonds had accepted a restructuring proposal.



Finance Minister Situmbeko Musokotwane said the staff-level agreement announced on Tuesday was &#8220;testament to Zambia&#8217;s determination to rebuild macroeconomic and debt sustainability&#8221; and its efforts to finalise restructuring talks within the parameters of its IMF programme.



(Reporting by Chris Mfula in Lusaka and Karin Strohecker in London; Writing by Bhargav Acharya; Editing by Alexander Winning and Ros Russell)

IMF logo is seen outside the headquarters building in Washington

Zambia asks for IMF loan to be increased to $1.7 billion

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1152" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-scaled.jpg" alt="" class="wp-image-400641" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-820x461.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-1536x864.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A collection of mixed denomination South African rand coins sit in an arranged photo in Johannesburg, South Africa, on Thursday, June 22, 2017. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



PRETORIA, June 4 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s economy recorded a small contraction in the first quarter of 2024, statistics agency data showed on Tuesday, hurt by a slump in the mining and construction sectors.



Gross domestic product shrank 0.1% in quarter-on-quarter seasonally-adjusted terms. Economists polled by Reuters had expected growth of 0.1%.



On a year-on-year basis the economy grew 0.5%&nbsp;ZAGDPY=ECI&nbsp;compared to economists&#8217; prediction for 0.6% growth.



The South African economy has stagnated over the last decade with rolling power cuts, high unemployment, and port and rail inefficiencies dragging down growth.



Six out of 10 industries tracked by Statistics South Africa contracted in the first three months of the year, led by construction and mining which declined 3.1% and 2.3% respectively.



A bleak backdrop for consumer spending also made a dent in first-quarter growth, as final consumption expenditure contracted 0.3%.



The South African central bank sees GDP growth of 1.2% this year, saying late last month that it expected a better second-quarter performance.



But the outlook has been muddied by last week&#8217;s election in which the African National Congress&nbsp;lost its majority&nbsp;for the first time in 30 years and must now seek one or more coalition partners to govern the country.



&#8220;The unexpected election results mean that things have become even more uncertain, and all bets are off,&#8221; Jee-A van der Linde, a senior economist at Oxford Economics Africa, said in a research note. &#8220;A business-friendly coalition outcome would improve confidence and should unlock fresh investment that could give the economy legs to run from the second half of 2024.&#8221;



(Reporting by Kopano Gumbi; Additional reporting by Bhargav Acharya in Johannesburg; Editing by Alexander Winning and Christina Fincher)

South African Economy As Inflation Rate Rises For First Time In 2017

South African economy unexpectedly contracts in first quarter

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-820x547.jpg" alt="" class="wp-image-493806" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2019589029-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Duncan Pieterse, director general of the National Treasury, during a news conference ahead of the budget presentation in Cape Town, South Africa, on Wednesday, Feb. 21, 2024. South African Finance minister Enoch Godongwana will table his annual budget on Wednesday in the lead up to elections that opinion polls show will deprive the ruling African National Congress of a parliamentary majority for the first time in three decades. Photographer: Dwayne Senior/Bloomberg via Getty Images</figcaption></figure>



JOHANNESBURG, June 4 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s National Treasury intends to stick to a balanced fiscal stance under a coalition government, its director-general said on Tuesday, after the African National Congress&nbsp;(ANC)&nbsp;lost its majority in last week&#8217;s election.



&#8220;I think that our fiscal strategy is achievable, even in a coalition environment&#8230; because it&#8217;s quite balanced,&#8221; Duncan Pieterse told Reuters in an interview.



The ANC has up to two weeks to agree a coalition pact or another form of power-sharing arrangement with other political parties, after its share of the vote dropped below 50% for the first time in the post-apartheid era.



&#8220;A balanced macro-fiscal stance becomes more defensible in an uncertain political environment. And we intend to continue managing the fiscal stance along those lines,&#8221; Pieterse said.



The ANC&#8217;s potential partners diverge widely, from the free-marketeer Democratic Alliance (DA) to the more radical uMkhonto we Sizwe (MK) and the Economic Freedom Fighters (EFF), parties that advocate nationalising mines and banks and redistributing land.



South African markets rallied on Monday as investors bet on the ANC opting for a coalition including the DA rather than one involving MK or the EFF.



(Reporting by Kopano Gumbi; Writing by Alexander Winning; Editing by Joe Bavier)

Reuters

Uganda hit by nationwide blackout for several hours, grid operator says

Kenya parliament approves $31 bln government spending next fiscal year

African Markets – Factors to watch on June 7

South African rand gains after ANC says it seeks unity government

Kenya to use World Bank loan to make $500 mln bond payment this month

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Botswana may raise De Beers stake as Anglo weighs spin-off

The typical CEO makes nearly 200 times more than their workers

South African rand edges higher with focus on ANC talks

South Africa’s financial system stable despite headwinds, central bank says

Kenya plans second Eurobond buyback in 2024, World Bank says

South African rand edges higher with focus on ANC coalition talks

South Korea, African countries sign agreements on minerals, exports

Zambia asks for IMF loan to be increased to $1.7 billion

South African economy unexpectedly contracts in first quarter

South Africa’s fiscal stance to stay balanced under coalition, Treasury says

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Reuters

Uganda hit by nationwide blackout for several hours, grid operator says

Kenya parliament approves $31 bln government spending next fiscal year

African Markets – Factors to watch on June 7

South African rand gains after ANC says it seeks unity government

Kenya to use World Bank loan to make $500 mln bond payment this month

EM equities extend gains; South Africa politics in focus

Kenya’s central bank sticks to 5.7% growth forecast for this year despite floods

Botswana may raise De Beers stake as Anglo weighs spin-off

The typical CEO makes nearly 200 times more than their workers

South African rand edges higher with focus on ANC talks

South Africa’s financial system stable despite headwinds, central bank says

Kenya plans second Eurobond buyback in 2024, World Bank says

South African rand edges higher with focus on ANC coalition talks

South Korea, African countries sign agreements on minerals, exports

Zambia asks for IMF loan to be increased to $1.7 billion

South African economy unexpectedly contracts in first quarter

South Africa’s fiscal stance to stay balanced under coalition, Treasury says

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