<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>



May 23 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Thursday.



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



Democratic Republic of Congo&#8217;s central bank is expected to hold its first monetary policy committee meeting for the year.



U.S. President Joe Biden hosts Kenyan President William Ruto for state visit to mark 60th anniversary of U.S.-Kenya diplomatic relations.



Chad&#8217;s newly elected president, junta leader Mahamat Idriss Deby, will be sworn in at a ceremony in the capital N&#8217;Djamena.



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



Several key Asian share benchmarks fell on Thursday as markets digested the implications of policymakers in major economies preferring to take patient approach to monetary easing amid sticky inflation.



[MKTS/GLOB]



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



Oil prices eased for a fourth straight day on Thursday on worries that U.S. borrowing costs could be hiked again if inflation surged, a move that could hurt oil demand.



[O/R]



<h2 class="wp-block-heading" id="h-africa-stocks">AFRICA STOCKS</h2>



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



The South African rand fell against the dollar on Wednesday as traders awaited Federal Reserve meeting minutes for hints on the interest rate path of the world&#8217;s biggest economy.



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



The Kenyan shilling weakened slightly against the dollar on Wednesday, LSEG data showed.



<h2 class="wp-block-heading" id="h-kcb-group-results">KCB GROUP RESULTS</h2>



Kenya&#8217;s KCB Group&#8217;s KCB.NR pretax profit for the first quarter of this year jumped 53%, helped by higher interest income, it said on Wednesday.



<h2 class="wp-block-heading" id="h-usa-africa">USA AFRICA</h2>



U.S. President Joe Biden said he plans to make an official visit to Africa in February after the U.S. presidential election, an announcement that presumed he will defeat Donald Trump.



<h2 class="wp-block-heading" id="h-congo-apple">CONGO APPLE</h2>



International lawyers representing the government of the Democratic Republic of Congo said on Wednesday they had new evidence gathered from whistleblowers, which deepened concerns that Apple AAPL.O could be sourcing minerals from conflict areas in eastern Congo.



<h2 class="wp-block-heading" id="h-mozambique-oil">MOZAMBIQUE OIL</h2>



Abu Dhabi National Oil Company (ADNOC) has bought Galp&#8217;s GALP.LS 10% stake in the Area 4 concession of the multi-billion-dollar natural gas project in Mozambique&#8217;s Rovuma basin, its fourth international foray into gas.



<h2 class="wp-block-heading" id="h-congo-politics">CONGO POLITICS</h2>



The Democratic Republic of Congo&#8217;s national assembly elected Vital Kamerhe, whose home was violently attacked on Sunday, as speaker in a delayed vote, a key step towards installing a government five months after a presidential election.



<h2 class="wp-block-heading" id="h-usa-kenya">USA KENYA</h2>



U.S. President Joe Biden is expected to designate Kenya as a major non-NATO ally during a three-day state visit by Kenyan President William Ruto this week, a source familiar with the plans said.



<h2 class="wp-block-heading" id="h-rwanda-imf">RWANDA IMF</h2>



The International Monetary Fund said on Wednesday it was releasing a combined $164.6 million in funds to Rwanda after its executive board concluded reviews of the country&#8217;s support programmes.



<h2 class="wp-block-heading" id="h-africa-drought">AFRICA DROUGHT</h2>



The U.N. World Food Programme (WFP) needs $400 million to feed millions of people in Southern Africa following a drought that plunged parts of the region into hunger, the programme said on Wednesday.



((Compiled by Nairobi Newsroom))

World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on May 23

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="519" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-820x519.jpg" alt="" class="wp-image-488951" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-820x519.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-300x190.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-142x90.jpg 142w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-768x486.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-1536x973.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/BHP-shares-hit-3-month-high-as-deadline-for-formal-Anglo-bid-looms-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A small toy figure and mineral imitation are seen in front of the BHP logo in this illustration taken November 19, 2021. REUTERS/Dado Ruvic/Illustration/File Photo</figcaption></figure>



PERTH/HONG KONG, May 23 (Reuters)&nbsp;&#8211;&nbsp;BHP&nbsp;BHP.AX&nbsp;will stand firm on the structure and value of its latest takeover proposal for Anglo American&nbsp;AAL.L, focusing instead on allaying its target&#8217;s concerns around execution risks over the coming week, sources said on Thursday.



The world&#8217;s biggest listed mining group now has until May 29 to make a firm bid for Anglo American or it will be forced to walk away for at least six months under the UK&#8217;s takeover rules after it was granted a one-week extension on Wednesday.



Two sources who have been in talks with the miner and its advisers said they expect BHP management will spend the next week properly understanding Anglo&#8217;s concerns on an asset-by-asset basis with a goal to convince it on the merits of the deal.



Baden Moore, analyst at broker CLSA in Sydney, said BHP&#8217;s goal will be to get Anglo American to agree to open its books and allow a further extension.



&#8220;They are gradually, gradually getting closer to a deal,&#8221; he said.



Anglo chairman Stuart Chambers highlighted concerns on Wednesday about completion and execution risks in BHP&#8217;s proposal, meaning the structure of any deal and the fate of Anglo&#8217;s businesses in South Africa remain big obstacles.



One solution that BHP has already offered is to foot the bill to demerge Kumba Iron Ore&nbsp;KIOJ.J&nbsp;which is expected to net the South African government $2 billion of much needed capital gains tax, according to a pre-due-diligence BHP estimate, said one of the sources.



Last week, Anglo announced plans to either spin-off or sell its less profitable nickel, diamond and platinum businesses to refocus on copper, and to also sell its coal businesses.



In that plan Anglo would need to bear those substantial spin-out costs itself, which would ultimately be borne by its shareholders.



If the deal does not go ahead, Anglo boss Duncan Wanblad will be under pressure to get top dollar for its diamonds business in particular and ensure its demergers proceed without any hiccups, two investors said. One foot wrong and BHP will be ready to pounce, they said.



&#8220;Anglo does not exist in a year&#8217;s time, one way or the other, in my mind,&#8221; one of the investors said.



BHP and Anglo are having joint meetings with UK and Australian regulators this week, a separate source told Reuters.



BHP&#8217;s latest 29.34 pounds per share approach, based on undisturbed share prices at market close on April 23, valued London-listed Anglo at 38.6 billion pounds (about $49.1 billion). The offer was still conditional on Anglo unbundling its platinum and iron ore assets in South Africa.



The May 29 deadline coincides with general elections in South Africa, where Anglo was formed and is still of significant national importance.



Shares of BHP fell 3.8% to A$44.47 on Thursday.



Anglo&#8217;s shares closed up 0.4% at 26.98 pounds on the London bourse on Wednesday.



($1 = 0.7864 pounds)



(Editing by Editing by Muralikumar Anantharaman)

FILE PHOTO: BHP shares jump 2.3% after Anglo announces break-up plan

BHP will not relent on structure, value of $49 bln Anglo offer, say sources

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="597" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-820x597.jpg" alt="" class="wp-image-489422" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-820x597.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-300x218.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-124x90.jpg 124w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-768x559.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-1536x1118.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/XX2B2BC7YVPIDOIN4SRDRQVBYQ-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A logo is pictured outside the World Trade Organization (WTO) in Geneva, Switzerland, September 28, 2021. REUTERS/Denis Balibouse/File Photo</figcaption></figure>



CAPE TOWN/BRUSSELS May 22 (Reuters)&nbsp;&#8211;&nbsp;South Africa is considering lodging a formal complaint at the World Trade Organization against the European Union&#8217;s &#8220;protectionist&#8221; carbon border levy, Trade Minister Ebrahim Patel said on Wednesday.



The EU&#8217;s proposed carbon border adjustment mechanism (CBAM), which will impose charges on imports of carbon-intensive goods like steel and cement into Europe, has faced criticism from some developing nations and sectors including China&#8217;s steel industry.



In October, the EU launched a trial phase of the world&#8217;s first carbon border levy, which from 2026 will impose costs on imports of steel, cement, aluminium, fertilisers, electricity, and hydrogen.



&#8220;We believe that first prize always is to reach agreement through engagement and negotiation and our door remains open to find a settlement with the European Union on this matter,&#8221; Patel told Reuters.



&#8220;Failing everything else, we would be obliged to take the next step which would be to lodge a formal complaint (at the WTO), but we are still continuing discussions with a view to finding an amicable solution,&#8221; he added.



A European Commission spokesperson said the border levy was designed to comply with WTO rules and would allow deductions for any carbon prices already paid abroad.



&#8220;EU domestic industry pays a carbon price. We need to make sure importers pay an equivalent price, based on the carbon content of their goods, to prevent carbon leakage and help reduce greenhouse gas emissions,&#8221; the spokesperson said.



&#8220;Carbon leakage&#8221; refers to the risk that, rather than reducing emissions, European industries would simply move abroad to avoid paying the EU&#8217;s domestic carbon price.



However, countries including South Africa say CBAM would penalise developing nations struggling to raise the large investments needed to reduce their industries&#8217; CO2 emissions.



&#8220;Instead of recognising differential levels of development, it imposes a one-size fits on all firms across the world,&#8221; Patel said.



He said South Africa, which could take a serious economic hit should CBAM be introduced, had raised the issue of trade-related measures on climate change at the WTO in February.



The EU is South Africa&#8217;s largest trading partner and the current version of CBAM could lead to a reduction of total exports to the EU of 4% in 2030 (or 0.02% reduction in GDP) relative to a baseline with no CBAM, an April report from the South African Reserve Bank said.



(Reporting by Wendell Roelf and Kate Abnett)

FILE PHOTO: A logo is pictured outside the World Trade Organization (WTO) in Geneva

S.Africa considers complaining to WTO against EU carbon border tax

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="728" height="485" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GRWCSJKK3NKH7M3COMPN5L5GGU.jpg" alt="" class="wp-image-420130" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GRWCSJKK3NKH7M3COMPN5L5GGU.jpg 728w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GRWCSJKK3NKH7M3COMPN5L5GGU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/GRWCSJKK3NKH7M3COMPN5L5GGU-135x90.jpg 135w" sizes="auto, (max-width: 728px) 100vw, 728px" /><figcaption class="wp-element-caption">The International Monetary Fund logo is seen at IMF headquarters in Washington, U.S., October 14, 2017. REUTERS/Yuri Gripas/File Photo</figcaption></figure>



JOHANNESBURG, May 22 (Reuters)&nbsp;&#8211;&nbsp;The International Monetary Fund said on Wednesday it was releasing a combined $164.6 million in funds to Rwanda after its executive board concluded reviews of the country&#8217;s&nbsp;support programmes.



Rwanda&#8217;s economy is forecast to expand 6.6% this year and 6.5% next year after an 8.2% expansion last year, IMF said in a statement.



&#8220;While fiscal consolidation may temporarily dampen growth, a rebound to 7.3 percent is anticipated in the medium term,&#8221; it said.



Rwanda&#8217;s economy largely depends on agriculture, tourism and manufacturing.



(Reporting by Bhargav Acharya, Writing by Tannur Anders, George Obulutsa; Editing by Bate Felix)

FILE PHOTO: The International Monetary Fund logo is seen at IMF headquarters in Washington

IMF to release $164.6 mln to Rwanda

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="515" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-820x515.jpg" alt="" class="wp-image-489417" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-820x515.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-300x188.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-143x90.jpg 143w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-768x482.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-1536x964.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/E3QSTNRI5NLCHAEJURPRJHWWEI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: FILE PHOTO: The Anglo American logo is seen in Rusternburg October 5, 2015. Picture taken October 5, 2015. REUTERS/Siphiwe Sibeko//File Photo</figcaption></figure>



LONDON, May 22 (Reuters) &#8211; Anglo American (AAL.L), opens new tab on Wednesday rejected a third takeover proposal from BHP Group (BHP.AX), opens new tab that valued the company at 38.6 billion pounds ($49.18 billion), but agreed to a one-week extension for its rival to table a binding offer.



The move marks the third unsuccessful offer in a month from BHP, the world&#8217;s biggest listed mining group, as Anglo works on a radical plan to divest its less profitable coal, nickel, diamond and platinum businesses.



The 29.34 pounds per share approach, based on undisturbed share prices at market close on April 23 and raised from an initial 25.08 pounds, is still conditional on Anglo un-bundling its platinum and iron ore assets in South Africa, the country where it was founded and has deep roots, employing more than 40,000 people.



Anglo reiterated that this condition carries significant execution and completion risks.



BHP&#8217;s proposal &#8220;does not address the Board&#8217;s concerns about the structure, which results in significant complexity, execution risks, an extended timeline to completion,&#8221; Anglo chairman Stuart Chambers said in a statement.



&#8220;(It) consequently has the potential for material value leakage to be disproportionately suffered by Anglo American&#8217;s shareholders,&#8221; he added.



Anglo&#8217;s share price reversed earlier losses at 27.15 pounds, up 1% by 1344 GMT.



BHP said in a separate statement that it will not increase the percentage of its shares it is offering Anglo&#8217;s shareholders as part of the deal, unless a third party makes a competing offer.



Analysts at JP Morgan last week said BHP would need to boost its offer by around 30% to reflect fair value for Anglo and its prized copper assets in Chile and Peru.



Developments such as artificial intelligence and automation, and the energy transition including electric vehicles and renewable energy, have driven up demand prospects for copper cable used to conduct electricity.



Reporting by Clara Denina and Felix Njini; additional reporting by Anousha Sakoui; Editing by Veronica Brown, Shinjini Ganguli, Kirsten Donovan

FILE PHOTO: BHP-Anglo American deal raises alarm in Japan’s steel industry

Anglo rejects BHP’s third offer, but leaves door open to engage with rival

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="562" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-820x562.jpg" alt="" class="wp-image-489354" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-820x562.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-300x206.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-131x90.jpg 131w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-768x527.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-1536x1053.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/HSRFB4DE3VJQHL6HXJ7GNC6KSA-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A worker attends to machinery at a smelter plant at Anglo American Platinum&#8217;s Unki mine in Shurugwi, Zimbabwe, May 16, 2019. REUTERS/Philimon Bulawayo/File Photo</figcaption></figure>



JOHANNESBURG, May 22 (Reuters)&nbsp;&#8211;&nbsp;BHP Group&#8217;s&nbsp;BHP.AX&nbsp;$43 billion takeover proposal for smaller rival Anglo American&nbsp;AAL.L&nbsp;needs a &#8220;meaningful revision&#8221;, Anglo&#8217;s second-biggest investor said on Wednesday, as the clock ticks for the world&#8217;s No.1 miner to submit a binding offer.



BHP&#8217;s latest all-share proposal, raised from an initial $39 billion, was dismissed by Anglo as significantly undervaluing the company and being difficult to execute.



BHP&#8217;s offer should reflect both the value of existing Anglo assets and the future options and benefits that BHP can derive, specifically from Anglo&#8217;s unlisted assets, said South Africa&#8217;s Public Investment Corporation (PIC), which owns a roughly 7% stake in Anglo, second only to BlackRock&#8217;s 9.6% holding.



&#8220;This would require a meaningful revision of the current BHP proposal that should take into consideration the material risks that current shareholders of both Anglo and its subsidiaries would have to assume,&#8221; it said.



The PIC, which manages about 2.6 trillion rand ($143 billion) in assets, is Africa&#8217;s second-biggest fund manager. It is also a top investor in Anglo Platinum and Kumba Iron Ore &#8211; two South African units of Anglo that BHP doesn&#8217;t want included in its portfolio, should its deal succeed.



BHP, which has until 1600 GMT on Wednesday to make a binding offer, has insisted that Anglo divests its platinum and iron ore units in South Africa as a condition for the merger.



Anglo has rebuffed two all-share proposals from BHP as inadequate and too difficult to execute and last week unveiled plans for a break-up to focus on energy transition metal copper, while spinning out or selling its coal, nickel, diamond and platinum businesses.



Anglo CEO Duncan Wanblad&#8217;s plan to refocus the company on copper, iron ore and fertiliser assets could lead investors to give it a premium share price rating similar to pure copper companies such as Antofagasta or Freeport-McMoRan in future, Ian Woodley, a portfolio manager at Old Mutual, said.



A failure to improve its market valuation could still make Anglo vulnerable to a takeover, he added.Anglo shareholder Legal &amp; General Investment Management (LGIM) said on Monday it supported the break-up plan and did not see a clear reason for the board to change stance on BHP&#8217;s offer, unless there was a reasonable premium to the underlying fair value of Anglo&#8217;s assets.



($1 = 18.2234 rand)



(Reporting by Felix Njini and Clara Denina; Writing by Bhargav Acharya and Tannur Anders; Editing by Alexander Winning and Mark Potter)

FILE PHOTO: BHP insists Anglo American’s South African assets must go in any takeover, sources say

Major Anglo investor says BHP bid needs ‘meaningful revision’

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-820x547.jpg" alt="" class="wp-image-489385" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-768x513.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-1536x1025.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/YCG36AWNFBPL5CKDLPPYGQ5XRU-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Cracks are seen in the dried up municipal dam in drought-stricken Graaff-Reinet, South Africa, November 14, 2019. REUTERS/Mike Hutchings/File Photo</figcaption></figure>



HARARE, May 22 (Reuters)&nbsp;&#8211;&nbsp;The U.N. World Food Programme (WFP) needs $400 million to feed millions of people in Southern Africa following a drought that plunged parts of the region into hunger, the programme said on Wednesday.



The WFP told Reuters it needed urgent funding for six months to support drought relief in Zimbabwe, Zambia and Malawi, after harvests fell as a result of an El Niño-induced drought that has affected 4.8 million people.



El Niño, a weather phenomenon that disrupts wind patterns and warms the temperature in parts of the Pacific Ocean, can impact crop yields by reducing rain levels.



&#8220;It&#8217;s fair to say this will probably be the biggest El Niño response we have ever done in Southern Africa,&#8221; WFP spokesperson Tomson Phiri told Reuters.



About 70% of the Southern African population that relies on rain-fed agriculture had their harvests &#8220;wiped out&#8221; by lack of rains, Phiri added.



Phiri said the WFP, which also provides cash payouts for hungry communities, is looking to buy grain from outside markets.



In August last year WFP spent $14 million to support communities in Lesotho, Madagascar, Mozambique and Zimbabwe, Phiri said.



Successive droughts in the region have caused dwindling grain stocks, forcing affected countries like Zimbabwe to obtain grain abroad.



A group of private millers in Zimbabwe are planning to import 1.4 million metric tonnes of maize from Brazil, Argentina and other countries to help address hunger.



In Zimbabwe Finance Minister Mthuli Ncube said the government will receive a $32 million insurance payout for drought relief from the African Union Climate Agency.



Ncube said part of the funding will be used as cash transfers for vulnerable communities with some going to humanitarian agencies to provide support for procuring food.



(Reporting by Nyasha Chingono; Editing by Tannur Anders, William Maclean)

FILE PHOTO: Cracks are seen in the dried up municipal dam in drought-stricken Graaff-Reinet,

UN food agency looks for $400 mln to feed millions in southern Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="622" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-820x622.jpg" alt="" class="wp-image-489351" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-820x622.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-300x227.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-119x90.jpg 119w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-768x582.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-1536x1164.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/CVOYCLDIW5OFFPIXIALIMN65GA-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A general view of fog over the Great Pyramids and old houses in Cairo, Egypt 24 January 2024. REUTERS/Amr Abdallah Dalsh/File Photo</figcaption></figure>



LONDON, May 22 (Reuters)&nbsp;&#8211;&nbsp;From Brazil, Nigeria and Turkey to even some of the riskiest emerging markets such as Egypt and Zambia, evidence is growing that a decade-long deterioration in sovereign credit ratings has finally started to reverse.



Economists watch ratings because they influence a country&#8217;s borrowing costs and many are now highlighting a turnaround that seems incongruous with the usual warnings about rising debt pressures.



According to Bank of America, almost three-quarters of all sovereign rating moves by S&amp;P, Moody&#8217;s and Fitch this year have been in a positive direction, compared with the almost 100% that went the other way in the first year of the COVID pandemic.



With that and the spike in global interest rates now in the rear view mirror, more good news should be coming too.



Moody’s now has 15 developing economies on a positive outlook &#8211; rating firm parlance for an upgrade watch &#8211; one of its highest numbers ever. S&amp;P has 17, while Fitch has seven more positive than negative outlooks, its best ratio since a post-global financial crisis rebound in ratings in 2011.



Fitch&#8217;s global head of sovereign research Ed Parker said the turnaround has been down to a combination of factors.



For some countries it has been a general recovery from COVID and/or the energy price spikes caused by the Ukraine war. Others are seeing country-specific improvements in policymaking, while a core group of junk-rated &#8220;frontier&#8221; nations are now benefiting from suddenly being able to access debt markets again, he said.



Aviva Investors&#8217; head of EM hard currency debt, Aaron Grehan, describes the current upgrade wave as a &#8220;definitive shift&#8221; that has also coincided with a sharp drop in the premiums that emerging markets almost everywhere have had to pay to borrow.



&#8220;Since 2020, well over 60% of all rating actions have been negative. In 2024, 70% have been positive,&#8221; Grehan said, adding that Aviva&#8217;s internal scoring models were similar.



<h2 class="wp-block-heading" id="h-decade-of-downgrades">DECADE OF DOWNGRADES</h2>



The awkward reality though is that the current run of upgrades will not make up for the last 10-15 years.



Turkey, South Africa, Brazil and Russia all lost coveted investment grade scores during that time, while a deluge of debt almost everywhere apart from the Gulf has left the average EM credit rating more than a notch lower than it used to be.



And though some countries argue that developed economies where debt is still surging are being treated more leniently by the rating firms, EM finances are hardly sparkling now.



Eldar Vakitov, a sovereign analyst and &#8220;bond vigilante&#8221; at M&amp;G Investments points to the International Monetary Fund&#8217;s recent forecast that the average EM fiscal deficit will edge up to 5.5% of GDP this year.



Just a year ago, the assumption was that the 2023 EM fiscal expansion was a one-off that would be fully reversed this year. Now the EM fiscal deficit is expected to remain above 5% of GDP until the end of the Fund’s forecast horizon in 2029.



So why all the rating upgrades?



&#8220;For some countries it is all about the starting point,&#8221; Vakitov said, explaining that even though government deficits were still wide, they had at least dropped down from peak COVID levels.



A few governments, such as Zambia, are getting a natural lift from coming out of debt restructurings while a number of places are making obvious policy improvements.



Turkey, which has already had a couple of upgrades for attacking its inflation problem head on, and Egypt which seems to have shaken off default worries, are both expected to see multi-notch upgrades now, according to market pricing.



&#8220;Rating agencies tend to be slow though,&#8221; Vakitov said, &#8220;so it often takes them a lot of time to give upgrades.&#8221;



<h2 class="wp-block-heading" id="h-coupon-payments">COUPON PAYMENTS</h2>



The downgrades have not stopped completely. Moody&#8217;s and Fitch have both put China on a warning over the last six months, Israel&#8217;s war has led to its first ever downgrades and Panama has been stripped of one of its investment grades.



Three years on from COVID spending splurges and the bills are having to be paid too. EM hard currency debt amortisations and coupon payments are expected to reach an all-time high of $134 billion this year, JP Morgan estimates.



That is up by $32 billion from last year, so it is not surprising then that emerging market policymakers are eager to do all they can to get their ratings up and keep borrowing costs down.



Indonesia&#8217;s Finance Minister Sri Mulyani Indrawati explained in London this month how the agencies had doubted her when she told them during COVID that Indonesia would get its deficit back below 3% of GDP within 3 years.



&#8220;It ended up that we were able to consolidate the fiscal (position) in only two years,&#8221; she said. &#8220;So I always like to say to my rating agency staff, I won the bet, so you have to upgrade my rating!&#8221;



(Reporting by Marc Jones; Editing by Alison Williams)

FILE PHOTO: A general view of fog over the Great Pyramids and old houses in Cairo

Emerging market credit ratings are finally looking up again

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-820x547.jpg" alt="" class="wp-image-489335" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/2BALKQIMVVOB7NOVSEI4UNEZRI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A Microsoft logo is seen a day after Microsoft Corp&#8217;s $26.2 billion purchase of LinkedIn Corp, in Los Angeles, California, U.S. June 14, 2016. REUTERS/Lucy Nicholson/File Photo</figcaption></figure>



May 22 (Reuters)&nbsp;&#8211;&nbsp;Microsoft&nbsp;MSFT.O&nbsp;is partnering with UAE-based AI firm G42 to invest $1 billion in a data center in Kenya as part of its efforts to expand cloud-computing services in East Africa, the companies said on Wednesday.



The data center, which will be built by G42 and its partners, will be powered by geothermal energy and provide access to Microsoft&#8217;s Azure through a new cloud region for East Africa.



<h2 class="wp-block-heading" id="h-why-it-s-important">WHY IT&#8217;S IMPORTANT</h2>



Abu Dhabi-based&nbsp;G42,&nbsp;in which Microsoft invested $1.5 billionlast month, has&nbsp;begun training an open-source large-language AI model in Swahili and English.



<h2 class="wp-block-heading" id="h-context">CONTEXT</h2>



Amazon.com&nbsp;AMZN.O, Microsoft and Alphabet&nbsp;GOOGL.Oare investing billions in new data centers across regions to cater to a boom in demand for cloud and generative AI-related services.



<h2 class="wp-block-heading" id="h-what-s-next">WHAT&#8217;S NEXT</h2>



The letter of intent will be signed on Friday between Microsoft, G42 and Kenya&#8217;s Ministry of Information, Communications and the Digital Economy as part of the country&#8217;s President William Ruto&#8217;s state visit to the United States, the Windows maker said.



Microsoft also said that the data center will become operational within two years of the parties signing definitive agreements.



(Reporting by Akash Sriram in Bengaluru; Editing by Nivedita Bhattacharjee and Anil D&#8217;Silva)

FILE PHOTO: A Microsoft logo is seen a day after Microsoft Corp’s (MSFT.O) $26.2 billion purchase of LinkedIn Corp (LNKD.N), in Los Angeles

Microsoft ties up with UAE-based AI firm to invest $1 bln in Kenya data center

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="562" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-820x562.jpg" alt="" class="wp-image-489318" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-820x562.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-300x206.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-131x90.jpg 131w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-768x526.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-1536x1052.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/77VC4ZKBPBPJFFYBYJIHNWEQ6I-1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Customers push trolleys as they shop at a Pick n Pay store at the Trade Route Mall, in Lenasia outside Johannesburg, South Africa, February 8, 2023. REUTERS/Siphiwe Sibeko/File Photo</figcaption></figure>



JOHANNESBURG, May 22 (Reuters)&nbsp;&#8211;&nbsp;Pick n Pay&nbsp;PIKJ.J&nbsp;said on Wednesday it expects to swing to a full-year loss as South Africa&#8217;s third-biggest grocer takes an impairment of 2.8 billion rand ($155 million) on loss-making and underperforming core supermarket stores.



But the market cheered a debt restructuring agreement with lenders, pushing its shares up 9.40% by 0755 GMT.



New CEO Sean Summers is tasked with turning round a company that has been losing market share against bigger rival Shoprite SHPJ.J and others for more than a decade in a highly promotional market as the economy struggles with high interest rates and rising inflation.



Specifically, he has to improve the performance of the core Pick n Pay supermarkets business.



Pick n Pay, which also owns discount grocery retailer Boxer, said the loss per share will range between 6.37 rand and 6.86 rand for the year ended on Feb. 25, compared with earnings per share of 2.43 rand in the previous year.



About 1.8 billion rand of the writedown is for selected loss-making company-owned Pick n Pay stores, &#8220;which will be closed or converted to Pick n Pay franchises or Boxer stores under the group&#8217;s strategic plan,&#8221; it said.



And a 1 billion rand impairment of assets is for underperforming company-owned stores that will remain open, the retailer added.



Other factors contributing to the expected loss include incremental net debt service costs and diesel expenses to run generators that help keep stores open during blackouts.



When it reports its results next Monday, the retailer expects to have increased group sales by 5.4%, boosted by Boxer and its clothing stores. Pick n Pay South Africa sales, however, are seen inching down by 0.2%.



Earlier in the year Summers announced a two-step recapitalisation plan that involves a rights issue to raise up to 4 billion rand and listing Boxer in order to repay all of its ballooning debt of 6.1 billion rand.



On Wednesday the company said it had concluded a debt restructuring agreement with short-term and long-term lenders that secures the group&#8217;s liquidity and funding up to September 1, 2025.



($1=18.0715 rand)



(Reporting by Nqobile Dludla, Editing by Louise Heavens and Clarence Fernandez)

FILE PHOTO: Pick n Pay sales grow but warns on extra costs from power cuts

South Africa’s Pick n Pay flags full-year loss with $154 mln impairment

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="531" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-820x531.jpg" alt="" class="wp-image-489300" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-820x531.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-300x194.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-139x90.jpg 139w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-768x498.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-1536x995.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/ARGIAOBTTJMZDB3GT55CBXY4SI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A man pushes a trolley loaded with a bag of maize meal outside a spaza shop in Thembisa, on the East Rand, in South Africa, August 2, 2023. REUTERS/Siphiwe Sibeko/File Photo</figcaption></figure>



JOHANNESBURG, May 22 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s inflation slowed slightly in April, its second decline in a row but it still remains above the central bank&#8217;s preferred level.



Headline consumer inflation dropped to 5.2% year on year in April from 5.3% in March, Statistics South Africa data showed. Economists polled by Reuters had predicted inflation would come in at 5.3%.



The South African Reserve Bank has been trying to steer inflation to the midpoint of its target range of 3% to 6%, keeping its main interest rate at 8.25%&nbsp;ZAREPO=ECI&nbsp;since May 2023.



The central bank said last month that the path back to 4.5% inflation would probably be &#8220;bumpy and protracted&#8221; due to setbacks in the disinflation trajectory.



On a month-on-month basis, headline inflation was at 0.3% in April compared to 0.8% a month before.



Core inflation, which excludes food and fuel prices, was at 4.6% year on year in April, down from 4.9% in March.



(Reporting by Bhargav Acharya; Editing by Alexander Winning)

ARGIAOBTTJMZDB3GT55CBXY4SI

South Africa inflation slows for second month in April

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM-820x547.jpg" alt="" class="wp-image-414999" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/02/TCKUIW7CHRO2RMH5MXMDLMBDDM.jpg 960w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The logo of French oil and gas company Total is seen in Rueil-Malmaison, near Paris, France, March 2, 2021. REUTERS/Benoit Tessier</figcaption></figure>



May 21 (Reuters)&nbsp;&#8211;&nbsp;French oil major TotalEnergies&nbsp;TTEF.PA&nbsp;is pressing ahead with the development of the Kaminho oil project 100 kilometers off the coast of Angola after a final investment decision on the block, it said on Tuesday.



The $6 billion project involves developing two oil fields located in Block 20/11, Cameia and Golfino, according to a statement from Angola&#8217;s national hydrocarbon agency ANPG.



Italian engineering firm Saipem&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HO18H&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">will convert</a>&nbsp;a very large crude carrier into a Floating Production Storage and Offloading (FPSO) unit, which will connect oil from the offshore fields to a subsea production network.



&#8220;This project&#8230; will become our seventh FPSO unit in the country and the first-ever development in the Kwanza basin,&#8221; TotalEnergies CEO Patrick Pouyanne said in a statement.



Production is expected to begin in 2028, with a plateau of 70,000 barrels of oil per day, the French company said in a statement.



TotalEnergies operates Block 20/11 with a 40% interest. Malaysia&#8217;s Petronas holds another 40%, and Angola&#8217;s Sonangol 20%



Angola, where TotalEnergies is the top operator, produces 1.1 million barrels of oil per day, making it Africa&#8217;s&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL2N3FY3GS&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">second-largest</a>&nbsp;crude exporter. Its fields however are declining by 15% each year.



The country has mounted an aggressive campaign to&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3H61QI&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">attract investors</a>, maintain oil production, bring on new reserves and increase natural gas production, as sector interest moves on to newer discoveries in Guyana, Namibia and Suriname.



(Reporting by Olivier Sorgho and America Hernandez in Paris, Wendell Roelf in Cape Town; Editing by Tassilo Hummel and Jan Harvey)

TCKUIW7CHRO2RMH5MXMDLMBDDM

TotalEnergies moves ahead on $6 billion Kaminho oil project in Angola

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="505" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-820x505.jpg" alt="" class="wp-image-425509" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-820x505.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-300x185.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-146x90.jpg 146w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-768x473.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-1536x946.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/NBJD7KLOVFLCTLYOENU66RMJGI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A man walks beneath electricity pylons during frequent power outages from South African utility Eskom, caused by its ageing coal-fired plants, in Orlando, Soweto, South Africa, January 16, 2023. REUTERS/Siphiwe Sibeko//File Photo</figcaption></figure>



CAPE TOWN, May 21 (Reuters)&nbsp;&#8211;&nbsp;South Africa is in talks with groups helping to fund its switch to a greener economy about delaying the closure of some coal plants as it battles to boost power supplies, and is optimistic of an agreement, the head of its state electricity utility said.



Africa&#8217;s most industrialised country became the poster child for the global energy transition when developed economies including Britain, the European Union and the United States together pledged $8.5 billion at U.N. climate talks in 2021 to help South Africa cut emissions and move away from coal.



But keeping the lights in a struggling economy while shutting down some old coal-fired plants supplying most of South Africa&#8217;s electricity needs has proven a tough task, forcing Eskom to delay commitments to shutter at least three power stations before 2030.



&#8220;There are some concerns with regards to how our strategy will impact some of the commitments that government has made and also how it will affect some of the funding that was earmarked for these initiatives,&#8221; Dan Marokane, the new chief executive of Eskom told an energy conference in Cape Town.



&#8220;We have spoken to them (partners), we’ve engaged with them and explained our rationale and the need for tactical cost adjustment and they’ve all understood this,&#8221; he said ahead of scheduled talks with funders in June and July.



Eskom has managed to suspend rolling&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AJ8N3F601U&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">power outages</a>&nbsp;&#8211; which have plagued the country for years &#8211; for almost two months&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL4N3HG1N6&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">ahead of an election</a>&nbsp;on May 29 that could see the ruling African National Congress lose its majority for the first time since it came to power in 1994.



Improving the low&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL5N3FF36N&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">energy availability</a>&nbsp;factor &#8211; the amount of power available at any given time &#8211; at old coal-fired power stations is a key aspect of the utility&#8217;s turnaround strategy.



Eskom had told Reuters last week that the country&#8217;s power supply crisis made it &#8220;nearly impossible&#8221; from a technical and political economy perspective to decommission its Camden, Grootvlei and Hendrina (CGH) coal stations over the next few years as originally intended.



&#8220;Eskom intends to delay the shut down of the CGH plants until March 2030, and to manage its carbon reduction targets through fleet-wide initiatives,&#8221; Eskom said.



On Tuesday, Eskom&#8217;s head of generation Bheki Nxumalo said four out of 10 units at the Hendrina plant had already been shut and the utility did not plan to bring these units back online.



&#8220;There is no plan to bring those other three or four units back because as we continue to improve the availability then the pressure becomes less,&#8221; Nxumalo said.



(Additional reporting by Joe Bavier; Writing by Tannur Anders;Editing by Alexander Winning and Mark Potter)

FILE PHOTO: South Africa’s Eskom to reduce power cuts but long-term outlook bleak

S.Africa in talks with climate backers over delaying coal plant closures

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="615" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-820x615.jpg" alt="" class="wp-image-489053" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-820x615.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-300x225.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-120x90.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-768x576.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-1536x1152.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/Feds-Waller-sees-some-progress-on-inflation-no-rate-hike-needed-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Federal Reserve Governor Christopher Waller poses before a speech at the San Francisco Fed, in San Francisco, California, U.S., March 31, 2023. REUTERS/Ann Saphir/File Photo</figcaption></figure>



WASHINGTON, May 21 (Reuters)&nbsp;&#8211;&nbsp;Federal Reserve Governor Christopher Waller on Tuesday put a pin in speculation that interest rates may need to rise again, saying the latest inflation data is &#8220;reassuring&#8221; and the U.S. central bank&#8217;s policy rate is set appropriately.



After three months of stronger-than-expected price pressures that raised concerns progress had stalled, &#8220;more recent data on the economy indicate that restrictive monetary policy is helping to cool off aggregate demand and the inflation data for April suggests that progress toward 2% has likely resumed,&#8221; Waller said in remarks prepared for delivery to the Peterson Institute for International Economics. &#8220;Central bankers should never say never, but the data suggests that inflation isn&#8217;t accelerating, and I believe that further increases in the policy rate are probably unnecessary.&#8221;



Fed policymakers have turned cautious on the outlook for inflation and monetary policy in recent months, and Waller, like many of his colleagues, did not repeat his view from recent speeches that a rate cut is likely later this year.



The labor market remains strong, he said, and while consumer price inflation slowed in April after the first three months of the year, the progress was &#8220;modest,&#8221; with core inflation as measured by the personal consumption expenditures price index likely running at an annualized 3.4% in the recent three months.



But he also said he sees some signs of moderation ahead, citing flat retail sales in April, rising delinquencies on credit cards and auto loans, and a widely followed survey of non-manufacturing businesses suggesting a deceleration in activity.&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL1N3H5367&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">Job creation</a>&nbsp;also has slowed, and the unemployment rate ticked up to 3.9% in April.



&#8220;The economy now seems to be evolving closer to what the Committee expected,&#8221; Waller said, referring to the central bank&#8217;s policy-setting Federal Open Market Committee. &#8220;Nevertheless, in the absence of a significant weakening in the labor market, I need to see several more months of good inflation data before I would be comfortable supporting an easing in the stance of monetary policy.&#8221;



The Fed has kept its benchmark policy rate in the 5.25%-5.50% range since last July.



Traders expect the central bank to deliver a first rate cut in September, and see better-than-even odds of a second cut at the Fed&#8217;s final meeting of the year in December.



(Reporting by Pete Schroeder, Ann Saphir, Lindsay Dunsmuir; Editing by Paul Simao)

FILE PHOTO: Federal Reserve Governor Christopher Waller poses before a speech at the San Francisco Fed

Fed’s Waller sees some progress on inflation, no rate hike needed

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-820x547.jpg" alt="" class="wp-image-486652" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/GettyImages-1763140582-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">SAINT PETERSBURG, RUSSIA &#8211; 2023/11/02: The national flag of the Federal Republic of Nigeria as a participating country at the 12th St. Petersburg International Gas Forum (SPIGF 2023). (Photo by Maksim Konstantinov/SOPA Images/LightRocket via Getty Images)</figcaption></figure>



ABUJA, May 21 (Reuters)&nbsp;&#8211;&nbsp;Nigeria&#8217;s central bank raised its benchmark lending rate&nbsp;by 150 basis points to&nbsp;26.25% from 24.75%&nbsp;NGCBIR=ECI, in a decision announced on Tuesday.



Analysts had widely predicted another hike given inflation has continued to soar and the local naira currency&nbsp;NGN=D1&nbsp;has been highly volatile.



The decision is the third rate increase this year, after hikes of 200 basis points in March and 400 basis points in February.



Inflation&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HI4A6&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">reached</a>&nbsp;a 28-year high of 33.69% year-on-year in April&nbsp;NGCPIY=ECI, spurred by the government slashing petrol and electricity subsidies and twice devaluing the naira.



(Reporting by Chijioke Ohuocha, Elisha Bala-Gbogbo, MacDonald DzirutweEditing by Bate Felix)

The national flag of the Federal Republic of Nigeria as a

Nigeria’s central bank raises benchmark rate to 26.25%

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-820x547.jpg" alt="" class="wp-image-489000" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/FACTBOX-What-is-Europes-landmark-AI-legislation-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: AI (Artificial Intelligence) letters and robot hand miniature in this illustration taken, June 23, 2023. REUTERS/Dado Ruvic/Illustration/File Photo</figcaption></figure>



BRUSSELS, May 21 (Reuters)&nbsp;&#8211;&nbsp;European Union policymakers on Tuesday&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL8N3HO1UO&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">endorsed</a>&nbsp;the world&#8217;s first comprehensive set of rules regulating the use of artificial intelligence (AI) in tools such as ChatGPT and in biometric surveillance that will likely come into force next month.



Here are the key points of the&nbsp;AI&nbsp;Act:



HIGH-RISK SYSTEMS



So-called high-risk&nbsp;AI&nbsp;systems &#8211; those deemed to have significant potential to harm health, safety, fundamental rights, the environment, democracy, elections and the rule of law &#8211; will have to comply with a set of requirements, such as undergoing a fundamental rights impact assessment, and obligations to gain access to the EU market.



AI&nbsp;systems considered to pose limited risks would be subject to very light transparency obligations, such as disclosure labels declaring that the content was&nbsp;AI-generated to allow users to decide on how to use it.



USE OF AI IN LAW ENFORCEMENT



The use of real-time remote biometric identification systems in public spaces by law enforcement will only be allowed to help identify victims of kidnapping, human trafficking, sexual exploitation, and to prevent a specific and present terrorist threat.



They will also be permitted in efforts to track down people suspected of terrorism offences, trafficking, sexual exploitation, murder, kidnapping, rape, armed robbery, participation in a criminal organisation and environmental crime.



GENERAL PURPOSE AI SYSTEMS (GPAI) AND FOUNDATION MODELS



GPAI&nbsp;and foundation models will be subject to lighter transparency requirements such as drawing up technical documentation, complying with EU copyright law and disseminating detailed summaries about the content used for algorithm training.



Foundation models classed as posing a systemic risk and high-impact GPAI&nbsp;will have to conduct model evaluations, assess and mitigate risks, conduct adversarial testing, report to the European Commission on serious incidents, ensure cybersecurity and report on their energy efficiency.



Until harmonised EU standards are published, GPAIs with systemic risks may rely on codes of practice to comply with the regulation.



PROHIBITED AI



The regulation bars the following:



&#8211; Biometric categorisation systems that use sensitive characteristics such as political, religious, philosophical beliefs, sexual orientation, race.



&#8211; Untargeted scraping of facial images from the internet or CCTV footage to create facial recognition databases;



&#8211; Emotion recognition in the workplace and educational institutions.



&#8211; Social scoring based on social behaviour or personal characteristics.



&#8211;&nbsp;AI&nbsp;systems that manipulate human behaviour to circumvent their free will.



&#8211;&nbsp;AI&nbsp;used to exploit the vulnerabilities of people due to their age, disability, social or economic situation.



WHO ENFORCES THE AI ACT



An&nbsp;AI&nbsp;Office within the European Commission will enforce the rules while an&nbsp;AI&nbsp;Board with EU representatives will assist the Commission and EU countries in applying the new legislation.



SANCTIONS FOR VIOLATIONS



Depending on the infringement and the size of the company involved, fines will start from 7.5 million euros ($8 million) or 1.5 % of global annual turnover, rising to up to 35 million euros or 7% of global turnover.



(Reporting by Foo Yun Chee, Editing by Helen Popper and Ed Osmond)

FILE PHOTO: Illustration shows AI (Artificial Intelligence) letters and robot hand miniature

What is Europe’s landmark AI legislation?

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="429" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-820x429.jpg" alt="" class="wp-image-488997" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-820x429.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-160x84.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-768x402.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies-1536x804.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/05/AI-summit-secures-safety-commitments-from-16-companies.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Britain&#8217;s Prime Minister Rishi Sunak speaks during the closing press conference on the second day of the UK Artificial Intelligence (AI) Safety Summit at Bletchley Park, near Milton Keynes, Britain November 2, 2023. Justin Tallis/Pool via REUTERS/File Photo</figcaption></figure>



SEOUL, May 21 (Reuters)&nbsp;&#8211;&nbsp;Sixteen companies involved in&nbsp;AI&nbsp;including Alphabet&#8217;s Google&nbsp;GOOGL.O, Meta&nbsp;META.O, Microsoft&nbsp;MSFT.O&nbsp;and OpenAI, as well as companies from China, South Korea and the United Arab Emirates have committed to safe development of the technology.



The announcement unveiled in a UK government statement on Tuesday came as South Korea and Britain host a global&nbsp;AI&nbsp;summit in Seoul at a time when the breakneck pace of&nbsp;AI&nbsp;innovation leaves governments scrambling to keep up.



The agreement is a step up from the number of&nbsp;<a href="https://www.gov.uk/government/news/world-leaders-top-ai-companies-set-out-plan-for-safety-testing-of-frontier-as-first-global-ai-safety-summit-concludes" target="_blank" rel="noreferrer noopener">commitments</a>at&nbsp;the first global&nbsp;AI&nbsp;summit held six months ago,&nbsp;the statement said.



Zhipu.ai,&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AP:4295882451&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">backed by</a>&nbsp;Chinese tech giants Alibaba&nbsp;9988.HK, Tencent&nbsp;0700.HK, Meituan&nbsp;3690.HK&nbsp;and Xiaomi&nbsp;1810.HK, as well as UAE&#8217;s Technology Innovation Institute were among the 16 companies pledging to publish safety frameworks on how they will measure risks of frontier&nbsp;AI&nbsp;models.



The firms, also including Amazon&nbsp;AMZN.O, IBM&nbsp;IBM.N&nbsp;and Samsung Electronics&nbsp;005930.KS, voluntarily committed to not develop or deploy&nbsp;AI&nbsp;models if the risks cannot be sufficiently mitigated, and to ensure governance and transparency on approaches to&nbsp;AI&nbsp;safety, the statement said.



&#8220;It&#8217;s vital to get international agreement on the &#8216;red lines&#8217; where&nbsp;AI&nbsp;development would become unacceptably dangerous to public safety,&#8221; said Beth Barnes, founder at METR, a non-profit for&nbsp;AI&nbsp;model safety.



The artificial intelligence (AI) summit in Seoul this week&nbsp;aims to build on a broad agreement at the first summit&nbsp;held in the United Kingdom to better address a wider array of&nbsp;<a href="https://www.reutersconnect.com/all?search=all%3AL1N3HN0YN&amp;linkedFromStory=true" target="_blank" rel="noreferrer noopener">risks</a>.



At the November summit, Tesla&#8217;s Elon Musk and OpenAI&nbsp;CEO Sam Altman mingled with some of their fiercest critics, while China co-signed the &#8220;<a href="https://www.google.com/url?sa=t&amp;rct=j&amp;q=&amp;esrc=s&amp;source=web&amp;cd=&amp;ved=2ahUKEwjqhuz975qGAxVXklYBHVHUApwQFnoECAYQAQ&amp;url=https%3A%2F%2Fwww.gov.uk%2Fgovernment%2Fpublications%2Fai-safety-summit-2023-the-bletchley-declaration%2Fthe-bletchley-declaration-by-countries-attending-the-ai-safety-summit-1-2-november-2023&amp;usg=AOvVaw3ArAa5McYZwdnAzGZ3BhKc&amp;opi=89978449">Bletchley Declaration</a>&#8221; on collectively managing&nbsp;AI&nbsp;risks alongside the United States and others.



British Prime Minister Rishi Sunak and South Korean President Yoon Suk Yeol will oversee a virtual summit later on Tuesday, followed by a ministerial session on Wednesday.



This week&#8217;s summit will address &#8220;building&#8230; on the commitment from the companies, also looking at how the (AI&nbsp;safety) institutes will work together,&#8221; Britain&#8217;s Technology Secretary Michelle Donelan told Reuters on Tuesday.



Since November, discussion on&nbsp;AI&nbsp;regulation has shifted from longer-term doomsday scenarios to &#8220;practical concerns&#8221; such as how to use&nbsp;AI&nbsp;in areas like medicine or finance, said&nbsp;Aidan Gomez, co-founder of large language model firm Cohere.



Industry participants wanted&nbsp;AI&nbsp;regulation that will give clarity and security on where the companies should invest, while avoiding entrenching big tech, Gomez said.



With countries such as the UK and U.S. establishing state-backed&nbsp;AI&nbsp;Safety Institutes for evaluating&nbsp;AI&nbsp;models and others expected to follow suit,&nbsp;AI&nbsp;firms are also concerned about the interoperability between jurisdictions, analysts said.



Representatives of the Group of Seven (G7) major democracies are expected to take part in the virtual summit, while Singapore and Australia were also invited, a South Korean presidential official said.



China will not participate in the virtual summit but is expected to attend Wednesday&#8217;s in-person ministerial session, the official said.



South Korea&#8217;s foreign ministry said Musk, former CEO of Google Eric Schmidt, Samsung Electronics&#8217; Chairman Jay Y. Lee and other&nbsp;AI&nbsp;industry leaders will participate in the summit.



(Reporting by Joyce Lee; Editing by Ed Davies and Christian Schmollnger)

Reuters

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Anglo rejects BHP’s third offer, but leaves door open to engage with rival

Major Anglo investor says BHP bid needs ‘meaningful revision’

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TotalEnergies moves ahead on $6 billion Kaminho oil project in Angola

S.Africa in talks with climate backers over delaying coal plant closures

Fed’s Waller sees some progress on inflation, no rate hike needed

Nigeria’s central bank raises benchmark rate to 26.25%

What is Europe’s landmark AI legislation?

AI summit secures safety commitments from 16 companies

News Tips

Advertise With Us

Reuters

African Markets – Factors to watch on May 23

BHP will not relent on structure, value of $49 bln Anglo offer, say sources

S.Africa considers complaining to WTO against EU carbon border tax

IMF to release $164.6 mln to Rwanda

Anglo rejects BHP’s third offer, but leaves door open to engage with rival

Major Anglo investor says BHP bid needs ‘meaningful revision’

UN food agency looks for $400 mln to feed millions in southern Africa

Emerging market credit ratings are finally looking up again

Microsoft ties up with UAE-based AI firm to invest $1 bln in Kenya data center

South Africa’s Pick n Pay flags full-year loss with $154 mln impairment

South Africa inflation slows for second month in April

TotalEnergies moves ahead on $6 billion Kaminho oil project in Angola

S.Africa in talks with climate backers over delaying coal plant closures

Fed’s Waller sees some progress on inflation, no rate hike needed

Nigeria’s central bank raises benchmark rate to 26.25%

What is Europe’s landmark AI legislation?

AI summit secures safety commitments from 16 companies

News Tips

Advertise With Us

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