Nigeria spending, SA investment, SARB to cut soon

Nigeria announced plans this week to raise 2024 budget spending again. Funding will come via a windfall tax on bank profits, but more measures will be needed to permanently boost revenues if Nigeria’s public finances aren’t to be left on a shaky footing. Elsewhere, South Africa outlined its aim to double public sector investment to 10% of GDP by 2030. While positive, we suspect that it will run up against hopes within parts of the ANC to boost welfare spending to undercut left-wing rivals, thereby creating tensions within the government of national unity. Finally, after the SARB’s MPC meeting on Thursday, we now expect an easing cycle to begin in September with a 25bp cut.