<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-820x547.jpg" alt="" class="wp-image-513284" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-609576648-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">John Dramani Mahama, Ghana&#8217;s president, speaks during the U.S.-Africa Business Forum in New York, U.S., on Wednesday, Sept. 21, 2016. The forum focuses on trade and investment opportunities on the continent for African heads of government and American business leaders. Photographer: Michael Nagle/Bloomberg via Getty Images</figcaption></figure>



ACCRA, July 31 (Reuters)&nbsp;&#8211;&nbsp;Former Ghanaian president John Dramani Mahama will try to renegotiate terms of an International Monetary Fund bailout and boost local ownership of future oil and mining projects if&nbsp;he wins a new term in office&nbsp;in December, he told Reuters.



Mahama, who was in office from 2012-16, will be the main challenger to the ruling party&#8217;s candidate, Vice President Mahamadu Bawumia, with a good chance to win given a severe economic crisis that has made the government unpopular.



&#8220;I&#8217;ve been in an IMF programme before, when I was president, and I know that the IMF is not averse to sitting and talking and renegotiating issues,&#8221; Mahama, 65, said in an interview.



Ghana defaulted on most of its $30 billion external debt in 2022 after the effects of years of overstretched borrowing were exacerbated by the COVID-19 pandemic, knock-on impacts of the war in Ukraine, and higher global interest rates.



The oil, gold and cocoa producer secured a $3 billion IMF bailout in May 2023, and in June this year reached separate deals with bilateral and commercial creditors to restructure its debts and freeze repayments until 2025.



The IMF has already disbursed $1.56 billion with another $360 million due by December. But Mahama said he would seek additional IMF funds&nbsp;to help Ghana resume the debt repayments.



He also said he would amend a public finance management law to introduce a compulsory debt-to-GDP ceiling of 60-70% to prevent excessive borrowing.



Further, Mahama said he would respect existing production contracts with oil and mining companies and not seek to raise taxes, but rather aim for higher royalties from future projects.



&#8220;I think we are at the upper range of taxes on profit &#8230; But I do think that in some cases the level at which we locked in the royalties is low.&#8221;



He held out the prospect of higher government stakes in future projects via the Minerals Income and Investment Fund, a sovereign wealth facility.



<h2 class="wp-block-heading" id="h-northern-duel">NORTHERN DUEL</h2>



While vice president in 2012, Mahama, of the National Democratic Congress (NDC), became president when John Evans Atta-Mills died in office. Mahama won his own mandate in a presidential election a few months later.



He lost elections in 2016 and 2020 to Nana Akufo-Addo of the New Patriotic Party (NPP), who must step down after this year&#8217;s Dec. 7 vote as he will have served the maximum two terms.



As president, Mahama invested heavily in infrastructure but drew criticism over power shortages, macroeconomic instability and allegations of political corruption, though he was not personally tainted. Critics of the NPP say those trends have continued or worsened under Akufo-Addo&#8217;s administration.



Mahama and Bawumia are both from northern Ghana, where the NDC was dominant for many years but the NPP has been making inroads.



&#8220;We the youth are hopeless, we don&#8217;t have jobs. How to eat, pay bills and feed our families is very hard,&#8221; Abdul-Wakil Neindow, 30, who lost his construction job in 2017 and has yet to find work, said at Mahama&#8217;s campaign launch at the weekend.



Ghana is one of Africa&#8217;s most stable democracies, with a history of peaceful transfers of power. No party has ever won more than two consecutive terms in government.



However, the last election was marred by opposition accusations that the government used the advantages of office to unfairly influence the outcome, which it denied.



Mahama urged supporters at his campaign launch to stay awake for 48 hours after voting to guard against any vote-rigging.



($1 = 15.4500 Ghanaian cedi)



(Writing by Portia Crowe; Editing by Estelle Shirbon and Mark Heinrich)

Key Speakers At The U.S.-Africa Business Forum

Ghana’s Mahama would renegotiate IMF deal if he regains presidency

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1292" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-scaled.jpeg" alt="" class="wp-image-416545" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-scaled.jpeg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-300x189.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-820x517.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-143x90.jpeg 143w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-768x484.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/04/106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report-1536x969.jpeg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A participant stands near a logo of World Bank at the International Monetary Fund &#8211; World Bank Annual Meeting 2018 in Nusa Dua, Bali, Indonesia, October 12, 2018.
Johannes Christo | Reuters</figcaption></figure>



July 31 (Reuters)&nbsp;&#8211;&nbsp;The World Bank&#8217;s board has approved $1.5 billion in financing for its first ever budget support lending to Ethiopia, the lender said late on Tuesday as the east African nation tries to push ahead with a long-running debt restructuring.



Africa&#8217;s second-most populous country secured a four-year, $3.4 billion programme from the International Monetary Fund on Monday, hours after its central bank floated its birr currency, paving the way for its debt overhaul to move forward.



The World Bank will provide a grant of $1 billion and another $500 million in a low interest credit line, part of the first ever direct budgetary support facility provided to Ethiopia, the global lender said.



&#8220;This policy operation supports home-grown reforms that will ultimately help the country transition to a more inclusive economy that allows the private sector to contribute more strongly to growth,&#8221; the World Bank said.



The bank plans to &#8220;provide around $6 billion in new commitments over the next three fiscal years and support economic reforms through fast-disbursing budget support,&#8221; it said.



The funding is part of a $10.7 billion financing package by the IMF, World Bank and other creditors, according to Ethiopian officials.



The financial support, however, was conditional on the government implementing significant economic reforms, including the liberalisation of the foreign currency market.



Ethiopia&#8217;s birr  was down 3% against the dollar early on Wednesday, trading at 77.13. It was little changed on Tuesday after tumbling 30% on the day it was floated on Monday.



Ethiopia sought to restructure its sovereign debt in 2021, under the G20 Common Framework initiative to offer relief to developing nations, but progress was slowed by a civil war in the northern region of Tigray that ended the following year.



Ethiopia&#8217;s winding debt restructuring mirrors that of Chad and Zambia which completed their debt overhauls under the Common Framework. Ghana, another African country saddled with high debt, is nearing the finish line of its own restructuring under the initiative.



Ethiopia&#8217;s development partners have welcomed its move to a market-based foreign exchange rate, but some analysts have said the move could drive up inflation and the cost of living, especially for its poorest residents.



The country of 126.5 million people also faces a number of other challenges, including the impact of climate change and the post-war reconstruction of Tigray.



(Reporting by Urvi Dugar and Dawit Endeshaw; Writing by Duncan Miriri; Editing by Tomasz Janowski)

106944604-16321717072021-09-20t205319z_656748898_rc2wtp9oerrm_rtrmadp_0_worldbank-ethics-report

World Bank approves $1.5 billion in financing for Ethiopia

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="535" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-820x535.jpg" alt="" class="wp-image-512981" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-820x535.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-300x196.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-138x90.jpg 138w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-768x502.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-1536x1003.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1235602799-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">JOHANNESBURG, SOUTH AFRICA &#8211; SEPTEMBER 28: Gauteng MEC Parks Tau at the launch of the Thabo Mbeki Presidential Library at the Thabo Mbeki Foundation on September 28, 2021 in Johannesburg, South Africa. The new library will serve as an archive centre for historical data such as speeches and documents of the former President and will also receive special collections from other African historical figures. (Photo by Luba Lesolle/Gallo Images via Getty Images)</figcaption></figure>



CAPE TOWN, July 30 (Reuters) &#8211; South Africa&#8217;s trade minister said on Tuesday he is confident his country will maintain preferential trade status with the U.S. despite concerns in Washington over its foreign policy including a strong pro-Palestinian stance.



Parks Tau was in Washington last week to lobby for renewal of the U.S. African Growth and Opportunity Act (AGOA) and South Africa&#8217;s continued participation in the programme, which provides duty-free access to the U.S.



South Africa has come under fire by some U.S. lawmakers for its relationship with Russia and its criticism of Israel in the Gaza conflict. It could lose eligibility for AGOA if it were determined to be undermining U.S. foreign policy interests.



&#8220;I am confident that AGOA will continue and that South Africa will stay in AGOA,&#8221; Tau told a press briefing.



&#8220;We will keep a close eye on the process and will continue to lobby,&#8221; he said, adding that further engagements were needed even though they had received a &#8220;relatively warm reception&#8221;.



U.S. trade officials said on Monday that they had positive discussions with the South African delegation.



&#8220;I think it was clear that our partners in South Africa have heard the concerns that were raised and there has been close engagement on multiple levels,&#8221; said the U.S. State Department&#8217;s Deputy Assistant Secretary for African Affairs Joy Basu.



AGOA is due to expire next year and President Joe Biden supports its renewal, but the U.S. election in November and possibility of a Donald Trump presidency introduces uncertainty.



Tau said that ideally the legislation would be renewed before the vote though U.S. officials have said that is unlikely. An annual review of each country&#8217;s eligibility is underway.



Separately, the U.S. House of Representatives last month voted in favour of a bill that would require a full review of the U.S. relationship with South Africa, citing concerns about ties to Russia and China and accusing it of supporting Palestinian militant group Hamas.



The bill would still need to pass the Senate and be signed by the president to become law.



South Africa says that supporting Palestinians does not equate to supporting Hamas.



Western nations are also unhappy with South Africa for failing to condemn Russia&#8217;s invasion of Ukraine. It has sought to position itself as a neutral mediator.



(Reporting by Wendell Roelf and Nellie Peyton; Editing by Andrew Cawthorne)

Launch of the Thabo Mbeki Presidential Library in South Africa

S.Africa confident of U.S. trade status despite unease over foreign policy

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="929" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi.jpeg" alt="" class="wp-image-512927" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi.jpeg 929w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107430690-1718744144150-gettyimages-1661425000-101_0193_gi-768x432.jpeg 768w" sizes="auto, (max-width: 929px) 100vw, 929px" /><figcaption class="wp-element-caption">Aerial view of cityscape and skyscraper at sunset in Dubai Marina. Lu Shaoji | Moment | Getty Images</figcaption></figure>



The United Arab Emirates is on track to be the world’s top wealth magnet for the third year running, according to the Henley Private Wealth Migration Report.



At the same time, the U.K. – already the source of many of the UAE’s expatriates – is projected to see its millionaire population drop by 17% by 2028, according to Swiss bank UBS.



High-net worth individuals are in many cases voting with their feet, seeking greener pastures – or in the case of tax-free expat hubs like Dubai, sandier beaches – as costs and taxes rise in their home country. The trend is likely to accelerate in the wake of the landslide election victory for the U.K.’s Labour Party in June, according to some financiers.



“There are push and pull factors for this trend of millionaires opting to relocate to Dubai,” Karim Jetha, a longtime regional investor who relocated to the UAE from the U.K. during the pandemic, told CNBC.



“Push factors include the prospect of higher taxes under a new Labour government. For example, one of Labour’s campaign pledges was to levy VAT on private school tuition, which would raise the cost by 20%,” he said. “Pull factors include Dubai’s perception of being extremely safe and visa reforms that encourage migration.”



The UAE is set to see a record net inflow of 6,700 millionaires from around the world by the end of 2024, according to the Henley report, which was released in June. That’s nearly double the second-ranked country on the list, the U.S., which is expected to welcome a net inflow of 3,800 millionaires in the same time frame.&nbsp;



“With its zero income tax, golden visas, luxury lifestyle, and strategic location, the UAE has entrenched itself as the world’s number one destination for migrating millionaires,” the report said. The UAE’s golden visa is a long-term residence visa that allows foreign residents to live, work or study in the UAE.



While the millionaires migrating to the UAE most commonly come from India, the wider Middle East, Russia, and Africa, a larger number of Brits and Europeans are expected to move to the glitzy desert emirate as well, it added.&nbsp;



Development and reforms in the UAE’s “wealth management ecosystem” are to thank for much of this, said Sunita Singh-Dalal, partner at the Hourani Private Wealth &amp; Family Offices in Dubai.&nbsp;



“In less than five years, the UAE has introduced a robust regulatory framework that provides the wealthy with a range of innovative solutions to protect, preserve and enhance their wealth,” she said.&nbsp;



Factors such as modern infrastructure and a robust international school system, geographical connectivity, low crime, no income tax, the remote worker visa and a number of investment incentives also help attract the wealthy to Dubai.&nbsp;&nbsp;



Britain, by contrast, is set to see its millionaire population drop from 3,061,553 last year to 2,542,464 by 2028, the UBS Global Wealth Report, which came out in June, forecast. But it’s important to note that the U.K.’s large millionaire population – the third-highest in the world – includes many foreign residents from places like Russia, the Middle East and elsewhere.



Now that the U.K. government is phasing out its “non-dom” status – which allowed wealthy and often foreign residents not to pay British taxes on overseas income – much of that population will be looking to drop their U.K. residencies.



“The outflow already generated by the economic and political turmoil in Britain risks being accelerated by further unwelcome policy decisions,” Hannah White, director of the independent think tank the Institute for Government in London, commented in the Henley report.&nbsp;



She pointed to the 40% duty already in effect on estates above a threshold of £325,000 ($417,755), as well as the ending of the UK’s non-dom tax regime starting in 2025.&nbsp;



The current Labour government has also pledged to drop the exemption for a 20% VAT charge on Britain’s private school tuition fees, which would make education significantly more expensive for those sending their children to the elite institutions.&nbsp;



“Labour’s commitment to remove their exemption from 20% VAT is a further unwelcome development,” White said.&nbsp;

107430690-1718744144150-gettyimages-1661425000-101_0193_gi

Dubai set to welcome even more millionaires as wealthy individuals abandon the UK

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-scaled.jpg" alt="" class="wp-image-493882" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/6A7M3AO7TJLVNGKEVN2F6TDGYE-820x547.jpg 820w, 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" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><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>



WASHINGTON, July 29 (Reuters)&nbsp;&#8211;&nbsp;Ethiopia has secured an agreement with the International Monetary Fund for a new financing program worth $3.4 billion, the IMF said on Monday.



Ethiopia&#8217;s central bank floated the country&#8217;s birr currency on Monday, a key step to secure IMF support, and to make progress on a long-delayed debt restructuring.



The Horn-of-Africa nation, which is struggling with high inflation and chronic foreign currency shortages, became the third economy on the continent in as many years to default on its debt at the end of last year.



It has been in talks with the IMF since last year to establish a new lending program, after the last fund-supported program agreed in 2019 was abandoned due to conflict in the northern region of Tigray that ended with a November 2022 peace deal.



Reuters previously reported Ethiopia was seeking to secure about $3.5 billion in a deal with the IMF.



The IMF said the agreement will enable an immediate disbursement of about $1 billion.



Africa&#8217;s second-most populous country requested a debt restructuring under the Group of 20&#8217;s Common Framework process in early 2021, but progress was slowed by the civil war in Tigray that lasted two years.



The government in Addis Ababa has unveiled some economic reforms, which analysts say are linked to the negotiations for a new IMF program, including the adoption of an interest rate-based monetary policy earlier this month.



(Reporting by Jasper Ward and Eric Beech; Writing by Duncan Miriri;)

IMF logo is seen outside the headquarters building in Washington

IMF, Ethiopia reach deal for $3.4 billion in financing

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="570" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-820x570.jpg" alt="" class="wp-image-512563" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-820x570.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-768x534.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-1536x1068.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2T3ATFNZVRN27LLBDMQ2WMTFI4-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">South Africa&#8217;s former President Jacob Zuma, leader of the uMkhonto we Sizwe party, arrives to give an address on current political developments post-elections, in Sandton, South Africa, June 16, 2024. REUTERS/Siphiwe Sibeko</figcaption></figure>



JOHANNESBURG, July 29 (Reuters) &#8211; Former South African president Jacob Zuma has been expelled from the African National Congress after backing a rival party in May&#8217;s parliamentary election, the ANC said on Monday.



Zuma was suspended from&nbsp;his long-time party&nbsp;in January after announcing he would&nbsp;support the&nbsp;new uMkhonto we Sizwe (MK) in the general election.&nbsp;He later became the leader and face of MK.



MK did better than expected in the poll and won about 15% of the vote, a major factor in the ANC&#8217;s loss of its majority for the first time since the apartheid era.



&#8220;Former President Jacob Zuma has actively impugned the integrity of the ANC and campaigned to dislodge the ANC from power, while claiming that he had not severed his membership,&#8221; ANC Secretary General Fikile Mbalula told the media.



&#8220;This conduct is irreconcilable with the spirit of organisational discipline and letter of the ANC Constitution.&#8221;



The ANC won 40.18% of the vote in the election, down from 57.50% it gathered in 2019, forcing it into a coalition government for the first time since it took power at the end of white minority rule in 1994. MK is now the official opposition.



MK responded to media reports that Zuma had been expelled in a statement earlier on Monday, criticizing the ANC&#8217;s process and condemning &#8220;grave injustices&#8221; against Zuma.



&#8220;President Zuma will engage his legal team to urgently determine the course of action,&#8221; it said.



Zuma will have 21 days to appeal the decision, the ANC said.



Zuma, whose nine years in office from 2009 were marked by corruption scandals and sluggish economic growth, has been at odds with the ANC&#8217;s leadership since he was forced to quit as party leader in 2018. He has repeatedly lashed out against his successor, President Cyril Ramaphosa.



(Reporting by Bhargav Acharya; Writing by Tannur Anders; Editing by Nellie Peyton and Peter Graff)

South Africa’s former President Zuma briefs media on political developments

South Africa’s ANC expels former president Zuma after election betrayal

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="533" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-820x533.jpg" alt="" class="wp-image-512560" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-820x533.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-300x195.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-139x90.jpg 139w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-768x499.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-1536x998.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-1405858383-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Cape Town South Africa, Aerial view of Table Mountain and city of Cape Town . In foreground passenger ferry bound for Robben Island. (Photo by: Peter Titmuss/UCG/Universal Images Group via Getty Images)</figcaption></figure>



CAPE TOWN, July 29 (Reuters)&nbsp;&#8211;&nbsp;More equipment is being mobilised to contain an oil spill from the ship &#8220;Ultra Galaxy&#8221; which ran aground on South Africa&#8217;s west coast and started to break up in stormy weather, authorities said on Monday.



Rough sea swells have battered the Panama-flagged general cargo vessel since it drifted onto a sand bank three weeks ago close to Doring Bay, some 300 km (186 miles) north of Cape Town, after the ship&#8217;s crew abandoned the vessel when it started taking on water.



&#8220;Salvage operations are continuing and more equipment is being mobilized to contain the oil spill,&#8221; said Tebogo Ramatjie, spokesperson for the South African Maritime Safety Authority (SAMSA).



The spill took place over the weekend when the ship broke into four sections, with large waves almost seven metres (23 ft) high crashing into the wreck every 15 seconds at one stage, SAMSA said.



An oil spill contingency plan was immediately launched and about 125 people from local communities are helping with mopping up operations, Ramatjie added.



The salvage team has managed to remove several lube oil drums and about eight tons of marine gas oil from the wreck&#8217;s fuel tanks. SAMSA has said there were approximately 500 tons of fuel aboard the vessel that need to be removed.



(Reporting by Wendell Roelf, Editing by William Maclean)

Cape Town South Africa, Aerial view of Table Mountain and city of Cape Town . In foreground passenger ferry bound for Robben Island.

South Africa steps up fight to contain oil spill from grounded ship

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-820x547.jpg" alt="" class="wp-image-512525" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



LAGOS, July 29 (Reuters)&nbsp;&#8211;&nbsp;Fuel queues lengthened across major Nigerian cities on Monday after state-oil company Nigerian National Petroleum Corp. faced problems supplying gasoline to local traders and depots.



Last year President Bola Tinubu&#8217;s government opened up gasoline imports to private companies but foreign currency shortages and a cap on the price of petrol has mean that NNPC remains the only importer. Nigeria&#8217;s new Dangote Refinery is yet to start processing gasoline.



&#8220;The NNPC Ltd wishes to state that the tightness in fuel supply and distribution witnessed in some parts of Lagos and the Federal Capital is as a result of a hitch in the discharge operations of a couple of vessels,” Olufemi Soneye, NNPC spokesperson said in a statement over the weekend when queues began forming.



Gasoline prices at retail stations have risen to over 800 naira ($0.5063) from around 617 naira per litre in May 2023 when the government announced it was ending gasoline subsidies. The price surge has added to already high inflation in Nigeria and a cost of living crisis.



The NNPC Ltd owes gasoline suppliers over $6 billion, thus affecting supplies, and is seeking to raise financing to settle the debts.



($1 = 1,580.0000 naira)



(Reporting by Isaac Anyaogu; Editing by Susan Fenton)

https___cloudfront-us-east-2.images.arcpublishing.com_reuters_QHFBVC6NYNJHDBQD6MW4EKPU2E

Nigerians queue for fuel as NNPC blames operational hitch

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="538" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-820x538.jpg" alt="" class="wp-image-512465" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-820x538.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-300x197.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-137x90.jpg 137w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-768x504.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-1536x1008.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/2ULCJYYHB5OH5O2DRQ44X3IBDI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A man counts Ethiopia&#8217;s birr notes in Merkato, one of Africa&#8217;s biggest open air market, in Addis Ababa, Ethiopia, April 25, 2024. REUTERS/Tiksa Negeri/File Photo</figcaption></figure>



ADDIS ABABA, July 29 (Reuters)&nbsp;&#8211;&nbsp;Ethiopia&#8217;s central bank floated the birr currency on Monday, a move it hopes will secure International Monetary Fund (IMF) support and&nbsp;enable&nbsp;progress on a long-delayed debt restructuring.



The birr&#8217;s value against the U.S. dollar slumped by 30% to 74.73 per dollar, the country&#8217;s biggest lender, Commercial Bank of Ethiopia said. The currency had been trading at 57.48 birr to the dollar on Friday.



The Horn of Africa nation, which has been struggling with soaring inflation and chronic foreign currency shortages, became the third economy on the continent in as many years to default on its government debt last December.



It has been in talks with the IMF to establish a new lending programme after the last programme,&nbsp;agreed in 2019,&nbsp;was abandoned due to conflict in the northern region of Tigray. Negotiations resumed after a November 2022 peace deal.



The central bank said in a statement on the float that &#8220;banks are henceforth allowed to buy and sell foreign currencies from/to their clients and among themselves at freely negotiated rates&#8221; and that it would only make &#8220;limited interventions&#8221; in the FX markets going forward.



The reforms were initially announced by Prime Minister Abiy Ahmed late on Sunday.



Central bank governor Mamo Mihretu said in an online video that,&nbsp;as part of the reforms, Ethiopia would get $10.7 billion in external financing from the IMF, the World Bank, and other creditors.



&#8220;The IMF and World Bank are both providing exceptional and front-loaded funding support that will be among their highest such allocations in the African continent,&#8221; he said.



Importers, who had been relying on the black market to secure dollars, expressed relief at the central bank&#8217;s move.



&#8220;Now I don&#8217;t need to go to black market to buy or sell dollars. It is now a market-based foreign exchange regime, so (we) will buy or sell based on the legal channels,&#8221; said a businessman in the capital Addis Ababa, who did not want to be named.



The IMF did not immediately respond to a request for comment. The fund&#8217;s executive board was scheduled to meet on Monday to discuss a new programme for Ethiopia, Bloomberg news agency reported. Reuters could not confirm the meeting.



Ethiopia&#8217;s main $1 billion dollar government bond edged higher to reach 75.42 cents on the dollar by 1400 GMT, its highest level since early 2022.



The United States welcomed the shift.



&#8220;Market-based FX is a difficult, but necessary step for Ethiopia to address macroeconomic distortions,&#8221; the U.S embassy in Addis Ababa posted on social media platform X.



Ethiopia, Africa&#8217;s second-most populous country, requested a debt restructuring under the Group of 20&#8217;s Common Framework process in early 2021, but&nbsp;the war in Tigray slowed&nbsp;progress.



The government previously announced other reforms that analysts say are linked to the IMF talks, including adopting an interest rate-based monetary policy earlier this month.



Some said the longer-term impact of the devaluation was less clear.



&#8220;The consequences of exchange rate regime change will take some time to be reflected on the economy,&#8221; Abdulmenan Mohammed, an Ethiopian economic analyst based in Britain, told Reuters. He said it could result in an increased cost of living &#8220;which will mainly affect the urban poor, the jobless, the pensioners, the low-paid employees.&#8221;



(Reporting by Dawit Endeshaw; Additional reporting by George Obulutsa in Nairobi and Marc Jones in London; Writing by Duncan Miriri; Editing by Ros Russell and Angus MacSwan)

Ethiopia’s economy struggles due to shortage of foreign currency

Ethiopia’s birr drops 30% as central bank floats currency

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="720" height="405" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107427541-1718145095655-gettyimages-2157186260-img_9260_rfb2tx0a.jpeg" alt="" class="wp-image-512447" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107427541-1718145095655-gettyimages-2157186260-img_9260_rfb2tx0a.jpeg 720w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107427541-1718145095655-gettyimages-2157186260-img_9260_rfb2tx0a-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107427541-1718145095655-gettyimages-2157186260-img_9260_rfb2tx0a-160x90.jpeg 160w" sizes="auto, (max-width: 720px) 100vw, 720px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



An important gauge for the Federal Reserve showed inflation eased slightly from a year ago in June, helping to open the way for a widely anticipated September interest rate cut.



The personal consumption expenditures price index increased 0.1% on the month and was up 2.5% from a year ago, in line with Dow Jones estimates, the Commerce Department reported Friday. The year-over-year gain in May was 2.6%, while the monthly measure was unchanged.



Fed officials use the PCE measure as their main baseline to gauge inflation, which continues to run above the central bank’s 2% long-range target.



Core inflation, which excludes food and energy, showed a monthly increase of 0.2% and 2.6% on the year, both also in line with expectations. Policymakers focus even more on core as a better gauge of longer-run trends as gas and groceries costs tend to fluctuate more than other items.



Stock market futures indicated a positive open on Wall Street following the release while Treasury yields moved lower. Futures markets price in a more aggressive path for Fed interest rate cuts.



“A two-word summary of the report is, ‘good enough,’” said Robert Frick, corporate economist with Navy Federal Credit Union. “Spending is good enough to maintain the expansion, and income is good enough to maintain spending, and the level of PCE inflation is good enough to make the decision to cut rates easy for the Fed.”



Goods prices fell 0.2% on the month while services increased 0.2%. Housing-related prices in June rose 0.3%, a slight deceleration from the 0.4% increase in each of the last three months and the smallest monthly gain going back at least to January 2023.



The report also indicated that personal income rose just 0.2%, below the 0.4% estimate. Spending increased 0.3%, meeting the forecast.



As spending held relatively strong, the savings rate decreased to 3.4%, hitting its lowest level since November 2022.



The report comes with markets paying close attention to which way the Fed is headed on monetary policy.



There’s little expectation that the rate-setting Federal Open Market Committee will make any moves at its policy meeting next Tuesday and Wednesday. However, market pricing is pointing strongly to a rate cut at the September meeting, which would be the first reduction since the early days of the Covid pandemic.



“Overall, it’s been a good week for the Fed. The economy appears to be on solid ground, and PCE inflation essentially remained steady,” said Chris Larkin, managing director of trading and investing at E-Trade Morgan Stanley. “But a rate cut next week remains a longshot. And while there’s plenty of time for the economic picture to change before the September FOMC meeting, the numbers have been trending in the Fed’s direction.”



As inflation rose to its highest level in more than 40 years in mid-2022, the Fed embarked on a series of aggressive hikes that took its benchmark borrowing rate to its highest level in some 23 years. However, the Fed has been on pause for the past year as it evaluates fluctuating data that earlier this year showed a resurgence in inflation but lately has displayed a gradual cooling that has many policymakers discussing the likelihood of at least one cut this year.



Futures markets have priced in about a 90% chance of a September reduction followed by cuts at both the November and December FOMC meetings, according to the CME Group’s FedWatch measure.



Fed officials, though, have been cautious in their remarks and have stressed that there is no set policy path, with data guiding the way.

107427541-1718145095655-gettyimages-2157186260-img_9260_rfb2tx0a

Fed’s key inflation gauge rose 2.5% in June from a year ago, easing path to rate cut

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1387" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-scaled.jpg" alt="" class="wp-image-469888" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-300x203.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-820x555.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-133x90.jpg 133w, https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-768x520.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/03/QHXVUHX3MJJHRDRSFYCEORRMQ4-2-1-1536x1040.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">People walk past the Bank of Ghana in Accra, Ghana, November 28, 2018. REUTERS/Zohra Bensemra/File Photo</figcaption></figure>



ACCRA, July 26 (Reuters) &#8211; Ghana&#8217;s central bank held its main interest rate steady at 29% for the third meeting in a row on Friday, saying a strong monetary stance was needed due to uncertainty over the inflation outlook.



Economists polled by Reuters before Friday&#8217;s announcement predicted a 50-basis-point cut in its main rate. They expect Ghana to finish the year with interest rates 200 basis points lower.



&#8220;Even though inflation is expected to remain within the target year band, the risks have tilted slightly on the upside,&#8221; Bank of Ghana Governor Ernest Addison told a news conference.



&#8220;This will require maintaining a strong monetary policy stance, supported by strong fiscal consolidation efforts,&#8221; Addison said.



He added that there was some uncertainty regarding the inflation path for the year given the recent exchange rate pressures, upward adjustment in utility tariffs, and increases in export fuel prices.



Ghana&#8217;s consumer inflation slowed last month to 22.8% year on year in June from 23.1% in May, but it remains well above the central bank&#8217;s 8% target with a margin of error of 2 percentage points either side.



Finance minister Mohammed Amin Adam said on Tuesday the West African nation would be able to reach the target for the year of 15% by the end of 2024, adding that its economy was rebounding faster than expected.



&#8220;The central bank is clearly reacting to the stalling disinflation during the first half of 2024, which has put both its short- and medium-term inflation targets at risk,&#8221; said Leslie Dwight Mensah, economist and research fellow at the Institute for Fiscal Studies in Accra.



&#8220;The decision has also been made with an eye on the cedi exchange rate, which has had a bad run in recent months and remains prone to depreciation given the economy&#8217;s limited foreign financing options,&#8221; Mensah said.



The West African cocoa, gold and oil producer has been restructuring its $30 billion debt in an attempt to emerge from its worst economic crisis in a generation.



Central bank governor Addison said economic activity in Ghana remained resilient in the context of a generally tight policy stance.



Ghana&#8217;s trade balance improved in the first half of the year, driven by higher exports of gold and crude oil, he said.



Strong gold output, and soaring prices helped Ghana earn more from the precious metal in the first half of 2024.



&#8220;The value of gold exports increased by 46.4% to $5.04 billion, while earnings from crude oil increased to $2 billion from $1.7 billion in the same period last year,&#8221; Addison said.



(Reporting by Christian Akorlie, additonal reporting by Maxwell Akalaare Adombila Writing by Anait MiridzhanianEditing by Bate Felix, William Maclean and Ros Russell)

People walk past the Bank of Ghana in Accra

Bank of Ghana keeps main rate unchanged over inflation concerns

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="576" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-820x576.jpg" alt="" class="wp-image-425778" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-820x576.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-300x211.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-128x90.jpg 128w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-768x540.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-1536x1079.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/OHD5J7KDHJJKBG6Q7MD3YOK36E-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: Nigeria&#8217;s President Bola Tinubu waves to a crowd as he takes the traditional ride on top of a ceremonial vehicle, after his swearing-in ceremony in Abuja, Nigeria May 29, 2023. REUTERS/Temilade Adelaja/File Photo</figcaption></figure>



ABUJA, July 26 (Reuters)&nbsp;&#8211;&nbsp;Nigeria plans to issue a diaspora bond of up to $500 million, its Finance Minister Olawale Edun said, as part of its strategy to stabilise and grow the economy.



The domestic dollar-denominated bond, set for issuance in the third quarter, aims to attract investment from Nigerians living abroad and those with savings held overseas, but also to demonstrate the strength and resilience of the economy amidst ongoing economic reforms.



Nigeria&#8217;s move to issue the securities comes in the wake of ongoing reforms by President Bola Tinubu, which have seen significant strides including a projected budget deficit of 4% this year, Edun said in a statement late on Thursday.



Since taking office a little over a year ago, Tinubu has instituted landmark reforms cheered by investors, including slashing costly petrol and electricity subsidies and twice devaluing the naira currency with a year.



Edun said the reforms, and the issuance of securities as an integral part of them, represent a concerted push by the government to boost inclusive growth, potentially lifting millions out of poverty while attracting domestic and foreign investments.



(Writing by Elisha Bala-Gbogbo; Editing by Sharon Singleton)

FILE PHOTO: Nigeria’s President Bola Tinubu waves to a crowd as he takes the traditional ride on top of a ceremonial vehicle after his swearing-in ceremony in Abuja

Nigeria to launch $500 million diaspora bond in economic growth push

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="929" height="523" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984.jpeg" alt="" class="wp-image-511432" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984.jpeg 929w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984-768x432.jpeg 768w" sizes="auto, (max-width: 929px) 100vw, 929px" /><figcaption class="wp-element-caption">The blue screen of death errors on computer screens are viewed due to the global communications outage caused by CrowdStrike, which provides cyber security services to US technology company Microsoft, on July 19, 2024 in Ankara, Turkey.  Harun Ozalp | Anadolu | Getty Images</figcaption></figure>



CrowdStrike CEO George Kurtz said that over 97% of Windows sensors are back online after an update from the cybersecurity firm caused one of the world’s biggest IT outages.



“To our customers still affected, please know we will not rest until we achieve full recovery,” Kurtz said in a LinkedIn post on Thursday.



Last week, CrowdStrike issued a routine update to its users around the world — which mainly comprise large businesses — that had a bug which caused Microsoft’s Windows operating system to crash.



Many users woke up on Friday to a blue screen error on Windows. The IT outage sparked chaos around the world, with flights being cancelled, businesses closing early and even medical staff scrambling to keep operations running.



CrowdStrike rolled back the update to fix the issue.



The company’s share price has been hammered since the incident, as CEO Kurtz looks to contain the reputational fallout.



“I am deeply sorry for the disruption this outage has caused and personally apologize to everyone impacted. While I can’t promise perfection, I can promise a response that is focused, effective, and with a sense of urgency,” he wrote on LinkedIn.



To apologize for the incident, CrowdStrike sent Uber Eats gift cards to “teammates and partners who have been helping customers through this situation,” a company spokesperson told CNBC.



TechCrunch previously reported the news and added that some people were having trouble using the gift card.



“Uber flagged it as fraud because of high usage rates,” a CrowdStrike spokesperson said.

108009036-1721398542475-gettyimages-2162004949-AA_19072024_1780984

CrowdStrike CEO says 97% of Windows sensors back online after major outage

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-scaled.jpeg" alt="" class="wp-image-511392" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-scaled.jpeg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-135x90.jpeg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC-1536x1024.jpeg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



OpenAI on Thursday announced a prototype of its search engine, called SearchGPT, which aims to give users “fast and timely answers with clear and relevant sources.”



The company said it eventually plans to integrate the tool, which is currently being tested with a small group of users, into its ChatGPT chatbot.



The rollout could have implications for Google and its dominant search engine. Since the launch of ChatGPT in November 2022, Alphabet investors have been concerned that OpenAI could take market share from Google in search by giving consumers new ways to seek information online. 



With this prototype, OpenAI is testing the waters for doing just that, promising users the chance to “search in a more natural, intuitive way” and ask follow-up questions “just like you would in a conversation.”



“We think there is room to make search much better than it is today,” OpenAI CEO Sam Altman wrote Thursday in a post on X.



Alphabet shares fell more than 3% on Thursday to close at $167.28, while the Nasdaq was down less than 1%.



In May, Google launched AI Overview, which CEO Sundar Pichai called the biggest change in search in 25 years, to a limited audience, allowing users to see a summary of answers to queries at the very top of Google Search.



Though Google had been working on AI Overview for more than a year, public criticism mounted after  users quickly noticed that queries returned nonsensical or inaccurate results within the AI feature — without any way to opt out.



“Google has been kind of shaking in their boots a little bit since this stuff first popped off,” said Daniel Faggella, founder and head of research at Emerj Artificial Intelligence Research, referring to generative artificial intelligence. “We haven’t seem their company crumble in the interim, but we have seen them kind of fumble.”&nbsp;



The SearchGPT announcement follows OpenAI’s launch last Thursday of a new AI model, “GPT-4o mini.” The new model is an offshoot of GPT-4o, the startup’s fastest and most powerful model to date, which it launched in May during a livestreamed event with executives. 



OpenAI, backed by Microsoft, has been valued at more than $80 billion by investors. The company, founded in 2015, is under pressure to stay on top of the generative AI market while finding ways to make money as it spends massive sums on processors and infrastructure to build and train its models.



Last Month, OpenAI announced the hiring of two top executives as well as a partnership with Apple that includes a ChatGPT-Siri integration. Sarah Friar, previously CEO of Nextdoor and finance chief at Square, joined as chief financial officer, and Kevin Weil, an ex-president at Planet Labs and former senior vice president at Twitter and a vice president at Facebook and Instagram, joined as chief product officer.



OpenAI is bolstering its C-suite as its large language models gain importance across the tech sector and as competition rapidly emerges in the burgeoning generative AI market.&nbsp;



Both OpenAI’s new mini AI model and the prototype of SearchGPT are also part of the company’s push to be at the forefront of “multimodality,” or the ability to offer a wide range of types of AI-generated media, like text, images, audio, video and search, inside one tool: ChatGPT.



For SearchGPT, OpenAI’s blog post said the tool’s visual results will lead to “richer understanding” for users.



Last year, OpenAI Chief Operating Officer Brad Lightcap told CNBC, “The world is multimodal.” He added that as humans “engage with the world, we see things, we hear things, we say things,” so limiting interactions to text is insufficient.

107418094-1716321352537-gettyimages-2153474140-AFP_34TH9TC

OpenAI announces a search engine called SearchGPT; Alphabet shares dip

<figure class="wp-block-image size-full is-resized"><img loading="lazy" decoding="async" width="1920" height="1080" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k.jpeg" alt="" class="wp-image-511374" style="width:840px;height:auto" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k.jpeg 1920w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-820x461.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k-1536x864.jpeg 1536w" sizes="auto, (max-width: 1920px) 100vw, 1920px" /><figcaption class="wp-element-caption">Photo: via CNBC</figcaption></figure>



Economic activity in the U.S. was considerably stronger than expected during the second quarter, boosted by a strong consumer, government spending and a sizeable inventory build, according to an initial estimate Thursday from the Commerce Department.



Real gross domestic product, a measure of all the goods and services produced during the April-through-June period, increased at a 2.8% annualized pace adjusted for seasonality and inflation. Economists surveyed by Dow Jones had been looking for growth of 2.1% following a 1.4% rise in the first quarter.



Consumer spending helped propel the growth number higher, as did contributions from private inventory investment and nonresidential fixed investment, according to the first of three estimates the department will provide.



Personal consumption expenditures, the main proxy in the Bureau of Economic Analysis report for consumer activity, increased 2.3% for the quarter, up from the 1.5% acceleration in Q1. Both services and goods spending saw solid increases for the quarter.



Inventories also were a significant contributor, adding 0.82 percentage point to the total gain. Government spending added a tailwind as well, rising 3.9% at the federal level, including a 5.2% surge in defense outlays.



On the downside, imports, which subtract from GDP, jumped 6.9%, the biggest quarterly rise since Q1 of 2022. Exports were up just 2%.



Stock market futures drifted higher following the report while Treasury yields moved lower.



“The composition of growth was one of the better mixes that we have observed in some time,” said Joseph Brusuelas, chief economist at RSM. The report “tends to support the idea that the American economy is in the midst of a productivity boom which over the medium term will lift living standards across the country via lower inflation, low employment and rising real wages.”



There was some good news on the inflation front: the personal consumption expenditures price index, a key measure for the Federal Reserve, increased 2.6% for the quarter, down from the 3.4% move in Q1. Excluding food and energy, core PCE prices, which the Fed focuses on even more as a longer-term inflation indicator, were up 2.9%, compared to a 3.7% increase in the prior period.



The so-called chain-weighted price index, which takes into account changes in consumer behavior, increased 2.3% for the quarter, below the 2.6% estimate.



Treasury Secretary Janet Yellen saw the GDP report as “affirming the path we’re on to steady growth and declining inflation,” in remarks she delivered Thursday morning in Rio de Janeiro.



One other key variable, final sales to private domestic purchasers, which the Fed considers a good indicator of underlying demand, accelerated at a 2.6% pace, the same as in the prior quarter.



However, the report also indicated that the personal savings rate continues to decelerate, at 3.5% for the quarter, compared with 3.8% in Q1.



There have been signs of cracks lately in the consumer picture.



A report Wednesday from the Philadelphia Federal Reserve showed credit card delinquencies at an all-time high according to data going back to 2012. Revolving debt balances also reached a new high even as banks reported tightening credit standards and declining new card originations.



However, retail sales numbers have continued to climb indicating that consumers are weathering the headwinds of high interest rates and persistent inflation.



There also is pressure in the housing market: Sales are declining while home prices continue to rise, putting stress on first-time homebuyers.



Federal Reserve officials are expected to hold interest rates steady when they meet next week, though market pricing is pointing to the first cut in four years in September. Policymakers have been circumspect about when they might start reducing rates, though recent comments indicate more of a willingness to start easing policy and most central bankers have said they see further increases as unlikely.



In other economic news Thursday, the Labor Department reported that initial jobless claims totaled 235,000 for the week ended July 20, down 10,000 from the previous week and exactly in line with the Dow Jones forecast. Continuing claims, which run a week behind, edged lower to 1.85 million.



Also, orders for durable goods — generally big-ticket items such as aircraft, appliances and computers — unexpectedly fell 6.6% in June, compared with the forecast for a 0.3% increase. However, excluding transportation, new orders increased 0.5%.

108004882-1720728328098-gettyimages-2161665996-economy451659_szz6uf7k

U.S. economy grew at a 2.8% pace in the second quarter, much more than expected

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="571" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-820x571.jpg" alt="" class="wp-image-511175" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-820x571.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-300x209.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-129x90.jpg 129w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-768x535.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-1536x1069.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/GettyImages-699242978-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">BLOEMFONTEIN, SOUTH AFRICA JUNE 15: (SOUTH AFRICA OUT) President of the Supreme Court of Appeal (SCA) Mandisa Maya opens up during an interview at her offices on June 15, 2017 in Bloemfontein, South Africa. Maya is the first female to occupy the post of President of the SCA in South Africa. (Photo by Gallo Images / The Times / Simphiwe Nkwali)</figcaption></figure>



JOHANNESBURG, July 25 (Reuters)&nbsp;&#8211;&nbsp;South African President Cyril Ramaphosa on Thursday named Mandisa Maya as the first female chief justice, effective on Sept. 1, following consultations with the Judicial Service Commission.



This is a significant milestone for the country, the presidency said in a statement.



Maya, the current deputy chief justice, will replace Raymond Zondo, whose term ends on Aug. 31.



This is a developing story&#8230;



(Reporting by Bhargav Acharya; Editing by Kevin Liffey and Richard Chang)

Close up with Supreme Court of Appeal head Mandisa Maya

South Africa appoints first woman chief justice

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="619" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-820x619.jpg" alt="" class="wp-image-511102" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-820x619.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-300x227.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-119x90.jpg 119w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-768x580.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-1536x1160.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/07/YCWFEE2J3NLKPHC3NQ2YRVFRB4-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO &#8211; Zimbabwean Finance Minister Mthuli Ncube looks on before the swearing in of new cabinet ministers at State House in Harare, Zimbabwe, September 10, 2018. REUTERS/Philimon Bulawayo</figcaption></figure>



HARARE, July 25 (Reuters)&nbsp;&#8211;&nbsp;Zimbabwe&#8217;s 2024 budget deficit is forecast to be 1.3% of gross domestic product, Finance Minister Mthuli Ncube said on Thursday,but warned that concerns remained over the impact of a drought on finances.



The finance ministry projected 2024 growth at 2% earlier this month, down from 3.5% forecast in November, as southern Africa suffers its worst drought in decades.



In his midterm budget review, Ncube told lawmakers that the agriculture sector was now projected to contract by 21.2%, against a contraction of 4.9% in November, due to the drought.



Ncube added that spending priorities for the remainder of the year could change as the government takes stock of the impact of the drought on food security and water.



In April, the southern African nation introduced its new gold-backed currency, Zimbabwe Gold (ZiG), its sixth attempt at a domestic currency in 15 years.



&#8220;Since the introduction of the ZiG currency, the economy is experiencing relatively stable prices and exchange rate,&#8221; Ncube said, adding that inflation had remained stable in the two months since its introduction.



Zimbabweans however have been slow to adopt the new currency, opting instead to continue trading in foreign currency, mainly US dollars.



Ncube introduced revised tax proposals which he says will encourage greater use of the currency, including changes to corporate taxes and making some domestic taxes only payable in local currency.



(Reporting by Nyasha Chingono in Harare and Kopano Gumbi in Johannesburg, additional reporting by Tannur Anders and Bhargav Acharya, writing by Kopano Gumbi, editing by Mark Heinrich and Bernadette Baum)

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