<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="528" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo-820x528.jpg" alt="" class="wp-image-501178" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo-820x528.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo-300x193.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo-140x90.jpg 140w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo-768x495.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/logo.jpg 1080w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



The University of Johannesburg (UJ) is now ranked number one in South Africa and on the African continent among universities that are younger than 50 years worldwide, according to the latest&nbsp;<a href="https://www.timeshighereducation.com/world-university-rankings/2024/young-university-rankings" target="_blank" rel="noreferrer noopener">Times Higher Education (THE) Young University Rankings</a>,&nbsp;released on May 14, 2024. UJ has also achieved its highest-ever position, soaring to 60th place among universities in the same category.



<h2 class="wp-block-heading" id="h-huge-improvement">Huge improvement</h2>



This marks a significant leap from the university’s previous ranking in the 151-200 band, demonstrating its relentless commitment to student success, cutting-edge research and societal impact.



UJ also claimed the top spot in Africa and South Africa, reaffirming its standing in the region. The&nbsp;<a href="https://www.timeshighereducation.com/world-university-rankings/2024/young-university-rankings" target="_blank" rel="noreferrer noopener">THE Young University Rankings</a>&nbsp;assess universities across key pillars including teaching, research, knowledge transfer, and international outlook, providing a comprehensive evaluation of institutional performance.



The 2024 ranking includes 673 universities, up from 605 in 2023. A further 499 institutions are listed with “reporter” status, meaning that they provided data but did not meet our eligibility criteria to receive a rank.



<h2 class="wp-block-heading" id="h-global-excellence">Global excellence</h2>



This recognition of UJ by&nbsp;<a href="https://www.timeshighereducation.com/world-university-rankings/2024/young-university-rankings" target="_blank" rel="noreferrer noopener">THE Young University Rankings</a>&nbsp;highlights the university’s rapid growth and outstanding potential in the global academic arena. Despite its relatively short history of 20 years of existence, UJ has demonstrated exceptional progress, challenging well-established institutions, some of which have more than a century of legacy.



In addition to its remarkable performance in the&nbsp;<a href="https://www.timeshighereducation.com/world-university-rankings/2024/young-university-rankings" target="_blank" rel="noreferrer noopener">THE rankings</a>, UJ has also secured a notable global position of 624 in the&nbsp;<a href="https://cwur.org/2024.php" target="_blank" rel="noreferrer noopener">Center for World University Rankings (CWUR)</a>&nbsp;for 2024. With a staggering 20,966 institutions evaluated for the 2024 edition of the CWUR, this assessment stands as one of the largest academic rankings of global universities.



Only the top 2,000 institutions from this rigorous evaluation attained a coveted spot on the published global list. &nbsp;UJ’s consistent upward trajectory in the CWUR reinforces its status as a premier educational institution in South Africa and beyond.



Professor Letlhokwa George Mpedi, Vice-Chancellor and Principal of UJ, expressed his delight in the University’s latest achievements.



“These rankings are a testament to the dedication and hard work of our faculty, staff, and students. UJ remains resolute in its mission to deliver world-class education, drive impactful research and innovation that contributes to societal advancement,” he says.



“Our progress is not just about numbers and figures; it’s all about the positive and lasting impact we have on our students and the broader society.”



<a href="https://uj.ac.za/possibilities/">Learn more</a> about UJ here.

Girl_Image_HighRes

The University of Johannesburg Celebrates Rise In Global Rankings

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1439" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-scaled.jpg" alt="" class="wp-image-424954" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-300x211.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-820x576.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-128x90.jpg 128w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-768x540.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/05/LA24V6GG4VKUROZCEGVVO63DKQ-1536x1079.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">A street money changer counts South African Rands in Harare, Zimbabwe, file. REUTERS/Philimon Bulawayo/File Photo</figcaption></figure>



JOHANNESBURG, June 27 (Reuters)&nbsp;&#8211;&nbsp;The South African rand fell sharply on Thursday as traders were spooked by a local media report that there was a major disagreement between the pro-business Democratic Alliance (DA) party and President Cyril Ramaphosa over cabinet posts.



At 1050 GMT, the rand traded at 18.36 against the dollar, around 1% weaker than its previous close.



Ramaphosa&#8217;s African National Congress (ANC) and the DA emerged as the two largest parties in the unity government after the ANC lost its parliamentary majority in an election last month.



The DA is expected to get cabinet positions in return for supporting Ramaphosa&#8217;s re-election as president.



News website News24 reported that Ramaphosa had backtracked on an offer to give the DA the minister of trade, industry and competition position, replacing it with tourism minister, although the overall number of ministerial positions offered remained the same at six.



News24 said the DA&#8217;s leadership had decided to tell Ramaphosa that if he does not stick to a prior agreement struck earlier in the week then &#8220;the deal is off&#8221; between the two parties.



Financial markets are on edge over the composition of the cabinet, as it will give an indication of whether the ANC intends to meaningfully share power with parties including the DA.



&#8220;As the cabinet announcement delay continues and rumours circulate, the rand is likely to experience further selling pressure,&#8221; said Zain Vawda, market analyst at OANDA.



The Johannesburg Stock Exchange&#8217;s Top-40 index was last down around 0.5%. The benchmark 2030 government bond was weaker, as the yield rose 15 basis points to 9.975%.



(Reporting by Tannur Anders; Editing by Alexander Winning and Anil D&#8217;Silva)

FILE PHOTO: A street money changer counts South African Rands in Harare

South African rand drops on news report of discord over cabinet posts

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1365" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-scaled.jpg" alt="" class="wp-image-501050" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/22SV2XFFTJKVFKWLT6QATFG6FU-1536x1024.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">Demonstrators react as police use tear gas to disperse protesters during a demonstration against Kenya&#8217;s proposed finance bill 2024/2025 in Nairobi, Kenya, June 25. REUTERS/Monicah Mwangi</figcaption></figure>



NAIROBI, June 27 (Reuters)&nbsp;&#8211;&nbsp;Kenyan police put up roadblocks on streets leading to the presidential palace on Thursday as some protesters vowed to &#8220;occupy State House&#8221;, despite the president&#8217;s climbdown on proposed tax hikes that sparked a week of demonstrations.



It was not clear how far protesters would be mollified by President William Ruto&#8217;s Wednesday decision to withdraw the finance bill, a day after clashes killed at least 23 people and parliament was briefly stormed and set alight.



Ruto is grappling with the most serious crisis of his two-year-old presidency as the youth-led protest movement has grown rapidly from online condemnations of the tax hikes into mass rallies demanding a political overhaul.



Lacking a formal leadership structure, however, protest supporters were divided on how far to carry the demonstrations.



&#8220;Let&#8217;s not be foolish as we fight for a better Kenya,&#8221; Boniface Mwangi, a prominent social justice activist, said in an Instagram post.



He voiced support for demonstrations on Thursday but opposed calls to invade State House, the president&#8217;s formal offices and residence, a move that he said could spur more violence and be used to justify a crackdown.



In the capital, Nairobi, police and soldiers patrolled the streets on Thursday and blocked access to the State House.



Police fired teargas to disperse several dozen people who had gathered in the centre of the city, although the crowds were nowhere near the size of those in Tuesday&#8217;s mass protests.



Reuters reporters saw army vehicles on the streets after the government deployed the military to help police.



Hundreds of protesters gathered in the port city of Mombasa and in the western city of Kisumu, local television footage showed, although those gatherings appeared peaceful.



While some protest supporters said they would not demonstrate on Thursday as the finance bill had been scrapped, others pledged to press on, saying only Ruto&#8217;s resignation would satisfy them.



&#8220;Right now is not about just the finance bill but about #RutoMustGo,&#8221; political activist and protester Davis Tafari told Reuters in a text message. &#8220;We have to make sure that Ruto and his MPs have resigned and fresh elections are held &#8230; We occupy State House for dignity and justice.&#8221;



Eli Owuor, 34, from Kibera, an informal settlement and a traditional hotbed of protests, also said he was prepared to join a push on to the State House.



&#8220;We may just need to visit Zakayo today in his house to prove that after parliament we can occupy State House,&#8221; he said, using a nickname protesters have given to Ruto that references a a biblical tax collector viewed as corrupt.



<h2 class="wp-block-heading" id="h-dialogue-austerity-are-next-steps">DIALOGUE, AUSTERITY ARE NEXT STEPS</h2>



In a speech on Wednesday, Ruto defended his push to raise taxes on items such as bread, cooking oil and diapers, saying it was justified by the need to cut Kenya&#8217;s high debt, which has made borrowing difficult and squeezed the currency.



But he acknowledged that the public had overwhelmingly rejected the finance bill. He said he would now start a dialogue with Kenyan youth and work on austerity measures, beginning with cuts to the budget of the presidency.



The International Monetary Fund, which has been urging the government to cut its deficit to obtain more funding, said it was closely monitoring the situation in Kenya.



&#8220;We are deeply concerned about the tragic events in Kenya in recent days,&#8221; the IMF said in a statement. &#8220;Our main goal in supporting Kenya is to help it overcome the difficult economic challenges it faces and improve its economic prospects and the well-being of its people.&#8221;



Ratings agency Moody&#8217;s said the shift in focus to cutting spending rather than boosting revenue will complicate the disbursement of future IMF funding and slow the pace of fiscal consolidation.



Analysts at JPMorgan said they had maintained their forecasts for a deficit of 4.5% of GDP in FY2024/2025, but acknowledged the government and IMF targets could be revised in light of recent developments.



They said the Central Bank of Kenya was unlikely to begin cutting rates until the final quarter of this year.



<h2 class="wp-block-heading" id="h-broad-appeal">BROAD APPEAL</h2>



Unlike previous demonstrations in Kenya called by political figures and often mobilised on the basis of ethnicity, the current protests have appealed broadly to those weary of rising living costs and endemic corruption.



From big cities to rural areas, most of Kenya&#8217;s 47 counties saw protests on Tuesday, even in Ruto&#8217;s hometown of Eldoret in his ethnic Kalenjin heartland.



At least 23 people were killed nationwide and 30 were being treated for bullet wounds, the Kenya Medical Association said. Medical officials in Nairobi said scores were injured.



(Reporting by Aaron Ross; Additional reporting by Giulia Paravicini, Monicah Mwangi and Olivia Kumwenda-Mtambo; Writing by Sharon Singleton; Editing by Clarence Fernandez and Philippa Fletcher)

Demonstration against Kenya’s proposed finance bill 2024/2025 in Nairobi

Kenya braces for fresh protests despite president’s tax climbdown

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="541" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-820x541.jpg" alt="" class="wp-image-425628" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-820x541.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-300x198.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-768x507.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-1536x1013.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2023/06/E2LAHPZEEFN6VLWP7WHSXPENYQ-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: The logo of South Africa&#8217;s central reserve bank is seen during the delivery of a keynote address by South Africa&#8217;s central bank governor, Lesetja Kganyago, at the University of the Witwatersrand in Johannesburg, South Africa, November 1, 2022. REUTERS/Siphiwe Sibeko/File Photo</figcaption></figure>



JOHANNESBURG, June 27 (Reuters) &#8211; South Africa recorded foreign direct investment inflows of 24.4 billion rand ($1.34 billion) in the first quarter of 2024, up from a revised 2.5 billion rand in the previous quarter, central bank data showed on Thursday.



The South African Reserve Bank said in its Quarterly Bulletin that the inflows were largely due to the acquisition of a local vehicle-tracking company by an overseas firm, without naming the company that was bought.



Portfolio investments recorded outflows for the seventh consecutive quarter of 52.0 billion rand in the first three months of 2024, compared to outflows of 9.0 billion rand in the fourth quarter of 2023.



The portfolio outflows reflected the disposal by non-residents of 24.2 billion rand of domestic equities and 27.8 billion rand of domestic debt securities.



&#8220;The outflow recorded for debt securities in the first quarter of 2024 could mainly be attributed to the maturity of a $1.5 billion international bond of national government,&#8221; the Reserve Bank said.



($1 = 18.1575 rand) 



(Reporting by Kopano Gumbi; Editing by Alexander Winning)

FILE PHOTO: South Africa’s central bank governor to delivers keynote address

South Africa’s FDI inflows pick up in first quarter – central bank

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="541" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-820x541.jpg" alt="" class="wp-image-501074" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-820x541.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-300x198.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-136x90.jpg 136w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-768x507.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-1536x1014.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IBU6Z3WQIRPDRFTLELJJA6WZCM-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: A fruits and vegetables vendor (L) pushes a trolly as he sets up his stall in Soweto, south west of Johannesburg, South Africa June 1, 2017. REUTERS/Siphiwe Sibek/File Photo</figcaption></figure>



June 27 (Reuters)&nbsp;&#8211;&nbsp;South Africa&#8217;s consumer confidence improved slightly in the second quarter due to fewer hours of load-shedding and a drop in fuel and food prices, but uncertainty around national elections kept some consumers worried, data released on Thursday showed.



The consumer confidence index (CCI), sponsored by First National Bank (FNB) and compiled by the Bureau for Economic Research (BER), improved to minus 12 points in the quarter, from minus 15 points in the first quarter.



&#8220;Positive developments such as the cessation of load-shedding during the second quarter, substantial cuts in fuel prices in June &#8230; a significant deceleration in food inflation likely buoyed confidence levels, particularly among low- and middle-income consumers,&#8221; FNB Chief Economist Mamello Matikinca-Ngwenya said.



However, the confidence among high-income households remained largely unchanged in the run-up to the national elections and amid persistently high interest rates.



&#8220;High interest rates and uncertainty over which parties would form part of South Africa&#8217;s government of national unity (GNU) probably kept the lid on high-income confidence,&#8221; Ngwenya said.



&#8220;Provided that the GNU remains intact and the JSE and rand exchange rate hold onto their recent gains, there is scope for an improvement in high-income confidence during the third quarter.&#8221;



The African National Congress (ANC) and its largest rival, the white-led, pro-business Democratic Alliance have agreed to work together in South Africa&#8217;s new government of national unity.



Investors anticipate that the unity government will pick up the pace on existing reform plans for electricity, rail and port sectors needed to revive an economy that has barely grown in the last decade and has an unemployment rate that is among the highest in the world.



(Reporting by Prerna Bedi in Bengaluru; Editing by Savio D&#8217;Souza)

A fruits and vegetables vendor pushes a trolly as he sets up his stall in Soweto, south west of Johannesburg

S. Africa consumer confidence recovers in Q2, survey shows

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="408" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg" alt="" class="wp-image-400697" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1076949610-612x612-1-300x200.jpg 300w" sizes="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">Double exposure of coin stack with city background and world map, financial graph, world map and global network business concept idea, element by NASA.</figcaption></figure>



JOHANNESBURG, June 27 (Reuters)&nbsp;&#8211;&nbsp;The following scheduled political and economic events, equity and currency market moves may affect South African markets on Thursday.



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



Negotiations over cabinet positions continue between the 10 political parties that make up the government of national unity. The cabinet could be announced on Thursday, judging by comments by party officials.



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



The South African Reserve Bank will release the June Quarterly Bulletin.



Statistics South Africa will publish May producer price inflation figures.



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



The South African rand edged lower on Wednesday, as an announcement on President Cyril Ramaphosa&#8217;s cabinet appeared imminent amid uncertainty over key appointments in the executive.



On the stock market, the Top-40 index closed 0.5% lower.



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



Asian shares fell and bond yields spiked on nervousness about inflation on Thursday, while the yen&#8217;s slide past 160-per-dollar had currency traders bracing for Japan to step in and steady it.



<h2 class="wp-block-heading" id="h-wall-street">WALL STREET</h2>



Major U.S. stock indexes closed with modest gains on Wednesday after a choppy trading session, with investors holding their cards close to the vest ahead of a presidential debate and an inflation report closely watched by Federal Reserve policy makers.



<h2 class="wp-block-heading" id="h-gold">GOLD</h2>



Gold prices steadied on Thursday after falling to a two-week low in the previous session, while investors awaited U.S. inflation data for insights into how soon the Federal Reserve will cut interest rates.



&#8211; &#8211; &#8211; &#8211;



Some of the main stories out in the South African press:



<h2 class="wp-block-heading" id="h-business-day">BUSINESS DAY</h2>



&#8211; Bank of America raises red flag over stability of GNU



&#8211; Ramaphosa draws DA closer as he prepares to announce cabinet



(Compiled by Tannur Anders; Editing by Mark Potter)

istockphoto-1076949610-612×612-1

South African Markets – Factors to watch on June 27

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



NAIROBI, June 27 (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-global-markets">GLOBAL MARKETS</h2>



Asian shares fell and bond yields spiked on nervousness about inflation on Thursday, while the yen&#8217;s slide past 160-per-dollar had currency traders bracing for Japan to step in and steady it.



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



Oil prices dipped on Thursday as a surprise build in U.S. stockpiles fuelled fears about slow demand from the world&#8217;s top oil consumer, though declines were capped by worries a potential expansion of the Gaza war may disrupt Middle East supplies.



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



The South African rand edged lower on Wednesday, as an announcement on President Cyril Ramaphosa&#8217;s cabinet appeared imminent amid uncertainty over key appointments in the executive.



<h2 class="wp-block-heading" id="h-nigeria-refinery">NIGERIA REFINERY</h2>



Nigeria&#8217;s Dangote Refinery is operating normally after a fire at its effluent treatment plant, it said on Wednesday, after videos circulated online of dark plumes of smoke at the 650,000 barrel-per-day facility.



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



The Kenyan shilling was flat on Wednesday, as traders waited to see how protests against tax hikes unfolded.



<h2 class="wp-block-heading" id="h-kenya-budget">KENYA BUDGET</h2>



Kenyan President William Ruto on Wednesday withdrew planned tax hikes, bowing to pressure from protesters who had stormed parliament, launched demonstrations across the country and threatened more action this week.



<h2 class="wp-block-heading" id="h-zambia-debt">ZAMBIA DEBT</h2>



The International Monetary Fund (IMF) said on Wednesday its executive board had completed a third review of Zambia&#8217;s Extended Credit Facility and approved an immediate disbursement of some $569.6 million.



((Compiled by Nairobi Newsroom))

World map with charts and graphs as symbols of global finance

African Markets – Factors to watch on June 27

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



June 26 (Reuters)&nbsp;&#8211;&nbsp;The International Monetary Fund (IMF) said on Wednesday its executive board had completed a third review of Zambia&#8217;s Extended Credit Facility and approved an immediate disbursement of some $569.6 million.



The Fund&#8217;s board also approved a request to increase its financial support from $1.3 billion to $1.7 billion to help the southern African country respond to a severe drought, which has caused crop losses and affected power generation.



In a statement, IMF official Antoinette Sayeh said Zambian authorities had made progress on economic and structural reforms while addressing humanitarian challenges due to the drought.



&#8220;Going ahead, coordinated macroeconomic policies, continued efforts to restore fiscal and debt sustainability, and consistent reform implementation would be key to addressing the impact of the drought, preserving macroeconomic stability, and bolstering growth,&#8221; said Sayeh, the Fund&#8217;s deputy managing director.



Copper-rich Zambia dragged itself out of default this month after a debt-restructuring process that took more than three-and-a-half years and was a cautionary tale for the G20&#8217;s Common Framework mechanism designed to help low-income countries tackle unsustainable debt burdens.



The protracted debt rework has deterred investment, constrained economic growth and weighed on local financial markets.



Zambia&#8217;s finance minister asked parliament last week to approve additional spending of 41.9 billion kwacha ($1.65 billion) to help repay external debt and address the drought.



(Reporting by Tannur Anders and Harshita Meenaktshi; editing by Diane Craft and Rami Ayyub)

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

IMF approves $570 mln Zambia payout, increases loan to $1.7 bln

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-820x234.jpg" alt="" class="wp-image-500803" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/blog-2099x600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Credit: Andrew Caballero-Reynolds/IMF Photo</figcaption></figure>



The global economy avoided what could have been a systemic debt crisis during the turbulence of recent years, but vulnerabilities remain amid high debt servicing costs that pose&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2024/01/24/how-to-ease-rising-external-debt-service-pressures-in-low-income-countries?utm_medium=email&amp;utm_source=govdelivery">an important challenge</a>&nbsp;for low and middle-income countries. Some may yet confront major tests.



When countries do falter on debt, restructuring is critical to containing the damage. Restructuring should be as quick as possible because delays deepen distress by making adjustment harder and adding to the costs for both debtors and creditors. Longer waits leave people suffering when they lose jobs and face increasing poverty, while creditors watch their losses mount as they wait for recovery. It’s a lose-lose situation.



While some sovereign restructurings have faced significant delays, we are working with our counterparts to accelerate the process. The progress achieved so far shows how the world can work together to reduce risks.



<h2 class="wp-block-heading" id="h-common-framework-has-started-to-deliver-nbsp">Common Framework has started to deliver&nbsp;</h2>



The Common Framework, which brings creditor countries together to help restructure debt where needed, has started to deliver. How? By reducing the time from IMF staff level agreement – a key step toward an IMF program – to delivering the financing assurances from official creditors required for program approval. This means that the Fund can move in more quickly to provide much needed financial assistance to the country. For example, Ghana’s agreement this year took five months to cover those steps, roughly half the time it took for Chad in 2021 and Zambia in 2022. Ethiopia’s talks are likely to be faster, closer to the customary two or three months.



<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="950" height="950" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original.png" alt="" class="wp-image-500802" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original.png 950w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original-300x300.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original-800x800.png 800w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original-90x90.png 90w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/spr-blog-newsletter-size_original-768x768.png 768w" sizes="auto, (max-width: 950px) 100vw, 950px" /></figure>



These improvements are possible in part because stakeholders have developed more experience working together, including with non-traditional official creditors like China, India, and Saudi Arabia. Earlier cases presented creditor coordination challenges. But becoming more familiar with the process helped parties better know what to expect, building trust, and allowing creditors to overcome more easily what had previously been stumbling blocks.



We are also seeing progress in accelerating debt restructuring for emerging market countries outside of the Common Framework. Sri Lanka’s case was faster than the process for Suriname that preceded it in 2021, reflecting improvements in creditor coordination and improved understanding of safeguards and assurances.



<h2 class="wp-block-heading" id="h-global-sovereign-debt-roundtable-has-been-effective-nbsp">Global Sovereign Debt Roundtable has been effective&nbsp;</h2>



The IMF, World Bank and the Presidency of the Group of Twenty introduced the Global Sovereign Debt Roundtable (GSDR) early last year to help overcome various disagreements on technical issues. Discussions among creditors and debtors have made progress on several key aspects, including&nbsp;<a href="https://clubdeparis.org/en/communications/page/comparability-of-treatment?utm_medium=email&amp;utm_source=govdelivery">comparability of treatment</a>&nbsp;among creditors, defining what debts are included in the restructuring, information sharing, and processes and timelines. This has helped accelerate ongoing restructuring cases and build good foundations for the future. That progress, summarized in a&nbsp;<a href="https://www.imf.org/-/media/Files/About/FAQ/gsdr/gsdr-compendium-of-common-understanding-on-technical-issues.ashx?utm_medium=email&amp;utm_source=govdelivery">recent report</a>, is a big step forward.



<h2 class="wp-block-heading" id="h-imf-is-reforming-its-debt-policies">IMF is reforming its debt policies</h2>



The IMF is building on our sovereign debt restructuring experience to make the process even faster. The Executive Board in April adopted significant&nbsp;<a href="https://www.imf.org/en/Publications/Policy-Papers/Issues/2024/04/16/Policy-Reform-Proposals-To-Promote-The-Funds-Capacity-To-Support-Countries-Undertaking-Debt-547821?utm_medium=email&amp;utm_source=govdelivery">reforms to our debt policies</a>:



<ul class="wp-block-list">
<li>They provide tools that generally would allow IMF program approval within two or three months of a staff-level agreement, including through safeguards that help us proceed in cases where there are coordination problems among creditors. Approval in principle for programs, which enables disbursement as soon as financing assurances materialize, will increase transparency and help complicated cases move along on such a schedule.</li>



<li>They create a new procedure for establishing financing assurances, which should provide greater flexibility over time. Accordingly, the Fund would assess that a “credible official creditor process” is underway, based on actions by the creditors and accounting for the creditor’s track record in delivering. This will eventually be considerably faster than the present practice of waiting for formal letters.</li>
</ul>



These reforms will facilitate faster engagement with the debtor country—a key step since delays can intensify a crisis. The reforms will also provide more information to creditors to help them reach restructuring decisions faster (either because the program can be approved more quickly, or through approval in principle). This would include information about our economic projections, policy commitments, and our debt sustainability analysis. This complements other Fund efforts to improve transparency and&nbsp;<a href="https://www.imf.org/en/Publications/Policy-Papers/Issues/2023/06/23/Staff-Guidance-Note-on-Information-Sharing-in-The-Context-of-Sovereign-Debt-Restructurings-535203?utm_medium=email&amp;utm_source=govdelivery">share information</a>&nbsp;in a timely manner with all stakeholders involved in the restructuring process.&nbsp;



High geopolitical tensions have made global economic cooperation more difficult. Yet we can take heart from the fact that creditors and Fund shareholders more broadly are coming together unanimously to assist countries that need debt restructuring. This is critical to further improve the international debt architecture which is a key priority, especially given the high debt levels and prohibitive debt servicing costs in some countries.



<h2 class="wp-block-heading" id="h-what-s-next">What’s next</h2>



As we strive to reduce delays, it is important to note that sovereign defaults and requests for comprehensive debt relief have tapered off since 2021 and 2022. The last notable request was Ghana’s more than a year ago. Markets have reopened earlier this year for low-income countries, with Benin, Cote d’Ivoire, Kenya, and Senegal having raised money from foreign investors. Emerging market bond spreads are back to pre-pandemic levels, signaling investor confidence that those countries can repay debt.



However, spreads for about 15 percent of emerging markets are at distressed levels, underscoring vulnerability. Likewise, low-income countries still need to refinance about $60 billion of external debt each year over the next two years—about triple the average in the decade through 2020. Around 15 percent of low-income countries are in debt distress and another 40 percent are at high risk of distress.



So, progress on debt must continue. The GSDR will continue to address remaining key restructuring challenges such as how official and private creditor processes can move in parallel, and ways to address liquidity challenges. This could involve a potential menu of options for countries including the use of the Common Framework for coordinated liquidity relief; liquidity management operations such as debt swaps or buy backs; and ways to support new inflows including through risk-sharing instruments.



The IMF will distill our policies in a sovereign debt handbook that we plan to publish later this year. This clarity should further underpin more efficient processes. We are also reviewing the debt sustainability framework for low-income countries, jointly with the World Bank, to ensure it remains fit for purpose.&nbsp;



<h2 class="wp-block-heading" id="h-easing-the-liquidity-squeeze">Easing the liquidity squeeze</h2>



More will be needed to address debt challenges and avoid distress amid elevated interest rates and financing needs, against a backdrop of enormous long-term financing needs for economic development and to cope with climate change.



Borrowing countries, creditors, and the international community have roles to play. Borrowers must foster economic growth and boost government revenues so that they can create space to finance development and climate-related spending while maintaining debt on a sustainable path. Given that policy reforms in borrowing countries will take time to deliver results, official creditors should consider mobilizing more funding at reduced cost, particularly grants. The Fund will continue to help support these efforts and provide adequate financing, including through the review of our concessional facilities.



A forthcoming blog will elaborate on how the international community must keep working together to help ease the burden of borrowing and alleviate the liquidity squeeze facing many emerging and low-income countries.

blog-2099×600-spr-sovereign-debt-restructuring-process-c-andrew-caballero-reynolds-imf-photo

Sovereign Debt Restructuring Process Is Improving Amid Cooperation and Reform

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="2048" height="1366" src="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-scaled.jpg" alt="" class="wp-image-427955" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-scaled.jpg 2048w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2023/10/Kenya-President-reshuffles-cabinet-swaps-foreign-affairs-minister-1536x1024.jpg 1536w" sizes="auto, (max-width: 2048px) 100vw, 2048px" /><figcaption class="wp-element-caption">FILE PHOTO: Kenya&#8217;s President William Ruto attends the Sustainable Development Goals (SDG) Summit at United Nations headquarters in New York City, New York, U.S., September 18, 2023. REUTERS/Caitlin Ochs/File Photo</figcaption></figure>



NAIROBI, June 26 (Reuters) &#8211; Kenya&#8217;s president on Wednesday withdrew planned tax rises, bowing to pressure from protesters who had stormed parliament, launched demonstrations across the country and threatened more action this week.



William Ruto said he would not sign a finance bill including the hikes a day after violent clashes between police and protesters at the assembly and nationwide left at least 23 people dead and scores wounded, according to medics.



&#8220;Listening keenly to the people of Kenya who have said loudly that they want nothing to do with this finance bill 2024, I concede. And therefore, I will not sign the 2024 finance bill, and it shall subsequently be withdrawn,&#8221; he said in a televised address.



Ruto said he would now start a dialogue with Kenyan youth, without going into details, and work on austerity measures &#8211; starting with cuts to the budget of the presidency &#8211; to make up the difference in the country&#8217;s finances.



The move will be seen as a major victory for a week-old protest movement that grew from online condemnations of tax increases into mass rallies demanding a political overhaul, in the most serious crisis of Ruto&#8217;s two-year-old presidency.



It may see off the immediate threat of more unrest, but leaves Ruto still caught between the competing demands of his hard-pressed citizens and of lenders such as the IMF &#8211; which is urging the government to cut deficits to obtain more financing.



On Tuesday, police opened fire on crowds who massed around parliament and later broke into the assembly&#8217;s compound, minutes after lawmakers had voted through the tax measures and sent them on to the president.



The Nation newspaper documented protests in at least 35 of Kenya&#8217;s 47 counties, from big cities to rural areas &#8211; even in Ruto&#8217;s hometown of Eldoret in his ethnic Kalenjin heartland.



At least 23 people were killed across the East African country and another 30 were being treated for bullet wounds, the Kenya Medical Association said on Wednesday. Medical officials in Nairobi said scores had been injured.



Protesters had earlier vowed to keep up their demonstrations in messages on social media using the hashtag #tupatanethursday, or &#8220;see you on Thursday&#8221; in a mix of Swahili and English.



Posts on social media had urged people to occupy State House, the president&#8217;s office and residence, on Thursday, and the local offices of the World Bank and the International Monetary Fund (IMF) on Friday, though it was not immediately clear if the calls came from individuals or a broader movement.



Heavily armed police patrolled the streets of the capital Nairobi, which were quieter than usual on Wednesday.



The protests began as an online outpouring of anger by young, tech-savvy Kenyans at proposed taxes on bread and diapers and evolved into a nationwide movement calling for the scrapping of the entire finance bill including the taxes.



Thousands took to the streets of Nairobi and several other cities during two days of protests last week as an online movement gathered momentum.



Protests in Kenya have usually been called by political leaders who can be amenable to negotiated settlements. But the young Kenyans in the current demonstrations have no official leader and they have been growing increasingly bold in their demands.



Lawmakers had already removed some tax hikes from the final version of the finance bill on Tuesday, including ones on bread and cooking oil, but inserted others in an effort to avoid a budget gap.

FILE PHOTO: Sustainable Development Goals (SDG) Summit at United Nations headquarters in New York

Kenya president backs down on tax rises after deadly protests

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-820x547.jpg" alt="" class="wp-image-500684" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2158704243-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">NAIROBI, KENYA &#8211; JUNE 25: People clash with police during a protest against the tax hikes in planned &#8216;Finance Bill 2024&#8217; as they march to the parliament building in Nairobi, Kenya on June 25, 2024. (Photo by Gerald Anderson/Anadolu via Getty Images)</figcaption></figure>



NAIROBI, June 26 (Reuters) &#8211; As John Aron headed out to join the protests raging outside parliament, he felt something huge had already shifted in Kenyan politics, jolting it away from its decades of dominance by party strongmen and ethnic loyalties.



At least eight people died when police opened fire on crowds trying to storm the assembly to protest against tax hikes on Tuesday. President William Ruto blamed &#8220;criminals&#8221;. Aron, from Nairobi&#8217;s Kibera slum, said the demonstrators were part of a brand new movement.



&#8220;It is going to unite the youth and the old like never before,&#8221; the 29-year-old told Reuters.



Over just one week, what began as an online outpouring of anger by young, tech-savvy Kenyans at proposed taxes on bread and diapers has morphed into nationwide movement untethered from the politicians who have traditionally rallied the masses.



Ruto&#8217;s allies initially dismissed the protests as a fit of pique by wealthy, entitled kids.



&#8220;They arrive at the protests in Uber. When they leave the protests, they go to KFC to eat chicken,&#8221; parliament majority leader Kimani Ichung&#8217;wah told supporters last week.



But the protests have built up into a much wider groundswell of anger that has become the most serious crisis of Ruto&#8217;s two-year-old presidency, leaving him fumbling for a response.



&#8220;It&#8217;s the people against the government,&#8221; Ronnie Baron, a 30-year-old English literature teacher&nbsp;said in the heart of the crowd in downtown Nairobi on Tuesday.



The slogans on the streets and social media have shifted from tax to calls for a complete political overhaul. &#8220;Ruto must go!&#8221; crowds chanted.



&#8220;Our leaders are saying they are going to sit down with the youth. And talk to us,&#8221; protester Mitchell Mwamodo said. But &#8220;we don&#8217;t have a leader. I am not trying to have a conversation. We are not ready to back down.&#8221;



Ruto&nbsp;had said on Sunday that he wanted to&nbsp;engage with the protest movement and praised it for staging earlier more peaceful demonstrations.



But as the rallies spread, authorities switched from the carrot to the stick, clashing with demonstrators across the country on Tuesday.



&#8220;They are just trying to find out which hand to shake and which hand to cut off,&#8221; said 37-year-old Mary Ngigi as tear gas swirled around her on Tuesday. &#8220;But we don&#8217;t even have any leaders.&#8221;



<h2 class="wp-block-heading" id="h-i-wish-i-was-born-in-another-country">&#8216;I WISH I WAS BORN IN ANOTHER COUNTRY&#8217;</h2>



Many said they had had enough of a political system under which the big parties took turns in power and funnelled jobs and opportunities to supporters and people from their ethnic groups.



&#8220;Our parents failed us. They voted along tribal lines,&#8221; 26-year-old Derick Kolito told Reuters. He said he had a master&#8217;s degree in accounts but had not managed to find a job.



&#8220;I am the son of peasants. You must have a godfather to get a job &#8230; I wish I was born in another country.&#8221;



Division among the main ethnic groups have traditionally been a key driver of politics and protest, with members of one group coming out against what they see as favouritism towards another.



But at demonstrations and in online forums where they have gathered to discuss and strategise, protesters have stuck to common grievances including steep rises in living costs and widespread corruption.



The protests have cut across Kenya&#8217;s geographic, social and ethnic landscape.



The Nation newspaper documented protests in at least 35 of Kenya&#8217;s 47 counties, from big cities to rural areas &#8211; even in Ruto&#8217;s hometown of Eldoret in his ethnic Kalenjin heartland.



Westen Shilaho, a scholar who has studied Kenyan protest movements, said the political elite have traditionally used &#8220;the ethnic card&#8221; to enhance their own power.



&#8220;Now that that one is not working in this context, they will try to insert the class card,&#8221;&nbsp;he said.



Veteran anti-corruption activist John Githongo said there was room for de-escalation &#8220;but it requires tremendous political creativity and humility on the part of the government.&#8221;



Parliamentarians&nbsp;did make some&nbsp;concessions to the protesters by removing some of the taxes in the finance bill &#8211; though they then added some others to&nbsp;reduce the deficit.



Minutes after they passed the legislation on Tuesday, protesters entered the parliamentary compound, pitching Kenyan democracy into uncharted waters.



By Wednesday morning, a new hashtag was trending on social media &#8211; #tupatanethursday, a mix of Swahili and English meaning &#8220;see you on Thursday&#8221;.



(Editing by Joe Bavier; Editing by Andrew Heavens)

Protest against tax hike in Kenya

Kenya’s youth-led protest movement leaves Ruto fumbling for a response

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-820x547.jpg" alt="" class="wp-image-500666" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/GettyImages-2017194273-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">JP Morgan headquarters at Canary Wharf financial district at the heart of Canary Wharf financial district on 6th February 2024 in London, United Kingdom. Canary Wharf is an area located near the Isle of Dogs in the London Borough of Tower Hamlets and is defined by the Greater London Authority as being part of London&#8217;s central business district. Along with the City of London, it constitutes one of the main financial centres in the United Kingdom and the world, containing many high-rise buildings including the third-tallest in the UK, One Canada Square. (photo by Mike Kemp/In Pictures via Getty Images)</figcaption></figure>



June 25 (Reuters)&nbsp;&#8211;&nbsp;India&#8217;s imminent inclusion in the world&#8217;s most widely followed emerging market bond index, JPMorgan&#8217;s GBI-EM, is expected to draw a combined $11 billion away from South Africa, Poland and Thailand&#8217;s local markets, the bank&#8217;s analysts have estimated.



The Wall Street lender said India&#8217;s entry, which starts on Friday and will take 10 months to complete, was likely to pull $4.7 billion from South Africa, $3.3 billion from Poland and $3.2 billion from Thailand.



It will also pull $2.9 billion and $2.5 billion from the Czech Republic and Chile respectively, it added.



&#8220;For EM-dedicated investors, we view India&#8217;s index inclusion as a zero-sum game and expect outflows from other EM local bond markets to accommodate,&#8221; JPMorgan&#8217;s strategists led by Michael Harrison said in a note.



On a broader level, the Europe, Middle East and Africa (EMEA) area is estimated to see the largest regional hit to index weight.



EMEA EM&#8217;s aggregate weight is expected to drop to 26.2% by March when India&#8217;s inclusion is complete compared to around 32% at the start of this month and 40% in 2021, before Russia&#8217;s 2022 exclusion from the index following its invasion of Ukraine.



International investors have bought more than $10 billion of Indian government bonds in the nine months since India&#8217;s inclusion was announced in September, taking their ownership to a record high.



&#8220;Index-related inflows to date&#8230; suggest 32-40% of the expected total of $20-25 billion of index-related inflows to India have already played out,&#8221; Harrison added.



Bond indexes like JPMorgan&#8217;s are influential because investment funds and other types of money managers use them as performance benchmarks which effectively informs what they tend to buy and sell.



In contrast to South Africa and the others, China, Indonesia and Mexico are not expected to see any reductions in their 10% GBI-EM index weights &#8211; the maximum one country can have, and the level India will have reached by March.



Latin America is expected to see a modest decrease, while EM Asia&#8217;s index weightage is estimated to increase, JPMorgan added.



(Reporting by Siddarth S and Johann M Cherian in Bengaluru and Marc Jones in London; Editing by Jan Harvey)

JP Morgan Headquarters At Canary Wharf

India’s JPMorgan bond index entry to suck $11 billion from S.Africa, Poland and Thailand

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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="588" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-820x588.jpg" alt="" class="wp-image-500391" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-820x588.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-300x215.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-125x90.jpg 125w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-768x551.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-1536x1102.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/YDXUHLFUPRP4RNSFLEWADBZOR4-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO &#8211; The tower of the headquarters of the Bank for International Settlements (BIS) is seen in Basel, Switzerland March 18, 2021. REUTERS/Arnd Wiegmann</figcaption></figure>



LONDON, June 25 (Reuters)&nbsp;&#8211;&nbsp;Central banks should embrace the benefits of artificial intelligence (AI) the Bank for International Settlements (BIS)has said, but stressed the technology should not replace humans when it comes to setting interest rates.



In its first major report into the rapidly advancing world of AI, the central banking umbrella group said policymakers need to harness its immense power to monitor data in real time in order to &#8220;sharpen&#8221; their inflation-predicting abilities.



That was something found badly wanting in the wake of COVID-19 and Russia&#8217;s invasion of Ukraine when the U.S. Federal Reserve, ECB and other major central banks all failed to grasp the strength of the global inflation surge.



New AI models should reduce the risk of a repeat although their untested nature and the fact they can &#8220;hallucinate&#8221; mean they should not become robo-ratesetters, Cecilia Skingsley, a top official at the BIS, said.



&#8220;We like to hold humans accountable,&#8221; the former Swedish central banker said, referring to the crucial role borrowing costs play in society and the need for judgment.



&#8220;So I can&#8217;t really see a future where an AI will be setting (interest) rates.&#8221;



The BIS, often dubbed the central bankers&#8217; central bank because of the joint work it does, already has eight projects involving AI.



Hyun Song Shin, its head of research and top economic adviser, said policymakers should not view it as &#8220;something magical&#8221; but did say it can help find needles in haystacks and spot vulnerabilities in financial systems.



The technology is also likely to radically reshape labour markets, impacting productivity and economic growth. Widespread adoption could see firms adjust prices more quickly in response to macro-economic changes with repercussions for inflation.



The BIS cautioned that AI also introduces risks, such as new types of cyber attacks, and may amplify existing ones, such as herding, bank runs and financial asset fire sales.



&#8220;The call for action to central banks is to foster a community of practice,&#8221; Shin said. &#8220;To share experience, to share best practice, but also to share data and the models themselves.&#8221;



(Reporting by Marc Jones; editing by Jason Neely)

FILE PHOTO – The tower of the Bank for International Settlements is seen in Basel

Central banks must prepare for profound impact of AI, BIS says

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-820x547.jpg" alt="" class="wp-image-500343" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/06/IDQEFEBXZ5P77DRBHHFL7D5QSI-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">FILE PHOTO: U.S. currency is seen in this picture illustration taken March 6, 2020. REUTERS/Mike Segar/Illustration/File Photo</figcaption></figure>



WASHINGTON, June 25 (Reuters)&nbsp;&#8211;&nbsp;The U.S. dollar remains the world&#8217;s primary reserve currency, and neither the euro nor the so-called BRICS countries have been able to reduce global reliance on the dollar, a new study by the Atlantic Council&#8217;s GeoEconomics Center shows.



The group&#8217;s &#8220;Dollar Dominance Monitor&#8221; said the dollar continued to dominate foreign reserve holdings, trade invoicing, and currency transactions globally and its role as the primary global reserve currency was secure in the near and medium term.



Dollar dominance — the outsized role of the U.S. dollar in the world economy — has been strengthened recently given the robust U.S. economy, tighter monetary policy and heightened geopolitical risks, even as economic fragmentation has strengthened a push by BRICS countries to shift into other international and reserve currencies.



The Atlantic Council report said Western sanctions on Russia imposed by the Group of Seven advanced economies after Moscow&#8217;s invasion of Ukraine had accelerated efforts by the BRICS countries to develop a currency union, but the group had been unable to make progress on its de-dollarization efforts.



BRICS is an intergovernmental organization made up of Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates.



The council said China&#8217;s Cross-Border Interbank Payment System (CIPS) added 62 direct participants in the 12 months to May 2024, an increase of 78%, bringing the total to 142 direct participants and 1,394 indirect participants.



Negotiations around an intra-BRICS payment system were still in the nascent stages, but bilateral and multilateral agreements within the group could form the basis for a currency exchange platform over time. However, these agreements were not easily scalable, since they were negotiated individually, the report said.



It noted that China has actively supported renminbi liquidity through swap lines with its trade partners, but the share of renminbi in global foreign currency reserves dropped to 2.3% from the peak of 2.8% in 2022.



&#8220;This is possibly because of reserve managers’ concern about China’s economy, Beijing’s position on the Russia-Ukraine war, and a potential Chinese invasion of Taiwan contributing to the perception of the renminbi as a geopolitically risky reserve currency,&#8221; the report said.



The euro, once considered a competitor to the dollar&#8217;s international role, was also weakening as an alternative currency, with those looking to reduce their risk exposure turning to gold instead, the report said.



It said Russian sanctions had made it clear to reserve managers that the euro was exposed to similar geopolitical risks as the dollar. Concerns around macroeconomic stability, fiscal consolidation, and the lack of a European capital markets union also hurt the euro’s international role, it said.



(Reporting by Andrea Shalal; Editing by Andrea Ricci)

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The University of Johannesburg Celebrates Rise In Global Rankings

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Kenya braces for fresh protests despite president’s tax climbdown

South Africa’s FDI inflows pick up in first quarter – central bank

S. Africa consumer confidence recovers in Q2, survey shows

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Central banks must prepare for profound impact of AI, BIS says

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