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Angola looks to restructure Angola’s debt problems finally seem to be surfacing. We’ve noted before that its public debt problem is, along with Zambia’s, one of the most acute in the region. (See here .) The government debt ratio was expected to breach …
5th June 2020
Debt talks moving forwards The past week has brought private sector debt relief for the region a step closer. Zambia hired advisors to help its restructuring talks. This was prompted by the IMF, which has made Zambia’s request for emergency financial …
29th May 2020
SA: Downturn starting from a point of weakness South Africa’s usual run of activity figures is behind schedule due to the lockdown. (See here .) The data for February, published this week, were of course outdated. But they showed that the economy was …
22nd May 2020
Nigeria’s budget saga continues The amendments to the 2020 budget approved by Nigeria’s cabinet this week suggest that the government is not yet fully facing up to the fiscal damage caused by the coronavirus. The authorities revised the budget for the …
15th May 2020
Lifting lockdowns to lessen economic pain After relatively early action to impose containment measures, more and more African countries are relaxing restrictions. Given patchy data on cases of Covid-19, it’s hard to tell whether the infections curve has …
7th May 2020
Rumours of private sector debt relief There seem to be growing moves towards some form of relief on debts owed to private creditors for low-income African economies. Several paths have been outlined in recent days. One suggestion is that private creditors …
1st May 2020
S. Africa’s fiscal stimulus: better late than never The news in South Africa this week has been dominated by the government’s announcement of a fiscal package to support the economy as well as details of easing lockdown measures from 1 st May. The fiscal …
24th April 2020
Debt relief on the cards The agreement by the G20 to allow low-income economies to suspend debt payments on bilateral loans this week will take one piece off African policymakers’ plate of economic challenges. Even so, their figurative plates remain …
17th April 2020
Coronavirus: latest on cases & containment This week the tally of coronavirus cases in Sub-Saharan Africa continued to increase, with some policymakers tightening restrictions further. But there are reasons to think that lockdown measures will be less …
9th April 2020
South Africa: Rand on the ropes The South African rand’s slide to record lows this week will probably continue over the coming weeks as risk-off sentiment persists. But the currency will probably rebound later this year as signs of a global recovery from …
3rd April 2020
Containment policies tighten…. The 21-day lockdown that took effect on 26 th March in South Africa is the most aggressive containment policy yet tried in any major African economy, but policymakers elsewhere in the region have also been imposing new …
27th March 2020
Coronavirus: African outbreak spreading Figures released this week suggest that the coronavirus outbreak in Sub-Saharan Africa spread rapidly this week. Officially confirmed cases more than tripled. While South Africa has the largest number of confirmed …
20th March 2020
Africa: Coronavirus cases contained, for now The number of confirmed coronavirus cases in Sub-Saharan Africa more than doubled this week, but there are still fewer confirmed cases in the billion-person region than in the US state of Massachusetts. …
13th March 2020
Coronavirus: Counting the costs in Africa The accelerating spread of the coronavirus has prompted us to update our African economic forecasts. We’ll publish final numbers after today’s OPEC+ meeting gives us a clearer sense of global oil prices, but we …
6th March 2020
South Africa’s budget: an uphill fight Finance Minister Tito Mboweni’s budget speech this week acknowledged the scale of the economic challenges facing South Africa, but we think that the minister’s outlook is still too rosy . The government’s increased …
28th February 2020
South Africa: Budget will be painful Finance Minister Tito Mboweni’s 26 th February budget speech will have to include tax rises and spending cuts as the government struggles to get a grip on its large deficit while providing financial aid to failing …
21st February 2020
South Africa: Ramaphosa doesn’t rock the boat President Cyril Ramaphosa used Thursday’s State of the Nation Address to outline his plans to reform South Africa’s ailing power sector, but his focus on building consensus among key social actors suggest that …
14th February 2020
Coronavirus: No infections won’t mean no cost Despite the lack of confirmed cases in the region, African economies are probably already feeling the indirect effects of the coronavirus outbreak. African economies are, at least, unlikely to be directly …
7th February 2020
Africa: CE pessimism about the usual suspects We published our quarterly Africa Outlook this week, in which we laid out our characteristically below-consensus forecasts for the region. But a look behind the headline number shows that we’re actually pretty …
31st January 2020
Nigeria: CBN tweaks policy, but holds the course Policymakers in Abuja kept their key interest rate on hold today, but made a technical adjustment to put a floor under falling interbank rates. Increasing the Cash Reserve Ratio from 22.5% to 27.5% will …
24th January 2020
South Africa: Recession warnings flashing The latest activity data suggest that the economy strengthened a touch in November, with output probably rising by 0.3% q/q saar. Given that widespread power cuts almost certainly disrupted output in December, we …
17th January 2020
South Africa: Latest figures point to Q4 decline Surveys and activity data released this week added to the evidence that South Africa’s economy contracted in the fourth quarter, which would have tipped the country into another technical recession. …
10th January 2020
South Africa: growing trade surplus not so positive The improvement in South Africa’s trade surplus in November was not the rare piece of positive news it first appeared and is merely a reflection of the weakness of the economy. The rise in the trade …
3rd January 2020
Nigeria: Trade restrictions hurt consumers Nigerian inflation jumped to 11.9% y/y in November, strengthening our view that recent border closures have pushed up prices. This will delay rate cuts until late next year. (See Chart 1.) Chart 1: Nigeria …
20th December 2019
South Africa: Recession risks rising Activity data released this week showed that South Africa’s economy continued to contract in October , raising the prospect that the country has entered a technical recession. (See Chart 1.). Chart 1: GDP & CE GDP …
13th December 2019
South Africa: Weak Q3, and trouble ahead Data released this week showed that South Africa’s economy contracted again in the third quarter, and more timely figures suggest that conditions remained bleak in Q4 - raising the spectre of another recession. The …
6th December 2019
Nigeria: CBN holds rate, toes government line The governor of the Central Bank of Nigeria (CBN) used this week’s MPC statement to heartily defend the government’s latest round of protectionist policies, which will add to the impression that the bank is …
29th November 2019
Nigeria: New data underlines struggling economy Economic growth in Nigeria remained very weak in Q3 , with the economy again failing to escape the slow-growth trajectory on which it has been stuck since 2017. (See Chart 1.) Chart 1: Nigeria GDP (% y/y) …
22nd November 2019
South Africa: More signs of contraction in Q3 Mining figures released this week showed that the sector exceeded downbeat expectations in September, but that output still fell over Q3 as a whole. Indeed, the available activity data suggests that GDP …
15th November 2019
South Africa: Inflation, growth both weak Figures out this week suggested that South Africa’s economy faltered in Q3 and that both inflation growth will be soft in the last quarter of the year. Manufacturing production figures were even worse than most …
8th November 2019
South Africa: Moody’s won’t be pleased New debt estimates from South Africa’s Treasury will probably prompt Moody’s to adopt a ‘negative’ outlook on the country’s local currency debt rating later today, paving the way for a downgrade to ‘junk’ status. We …
1st November 2019
Angola: Kwanza dives as BNA removes trading cap The National Bank of Angola’s decision to abandon its currency trading band and allow the kwanza to float freely suggests that policymakers are finally getting serious about FX reforms. But, after several …
25th October 2019
Nigeria: Abuja doubles down on protectionism The Nigerian government unexpectedly banned all trade (imports and exports) across the country’s land borders on Tuesday. Officials said the closure, which they described as an effort to combat smuggling, would …
18th October 2019
Nigeria’s budget: Timing is everything The draft budget published this week was more notable for its timing than its contents. This is the first time in several years that the document has been published in Q3, raising the possibility that lawmakers may …
11th October 2019
Nigeria: CBN lending push will have little effect The Central Bank of Nigeria has increased pressure on commercial banks to extend more loans by announcing that the minimum loan-to-deposit ratio will rise from 60% to 65% in December. In aggregate, banks …
4th October 2019
Kenya: CBK hints at looser policy in 2020 As we’d expected, policymakers at the Central Bank of Kenya (CBK) kept their benchmark rate unchanged at 9.00% for the seventh consecutive meeting this week. New language in the accompanying statement, however, …
27th September 2019
South Africa: Economy falters, no help from SARB Policymakers’ decision to leave their key rate on hold at 6.50% this week suggests to us that the South African Reserve Bank is unlikely to loosen policy further. We’d always argued that inflation would …
20th September 2019
Cutting Nigeria’s oil output: an empty promise? The pledge this week by Nigeria’s oil minister to reduce oil production to fully comply with OPEC+ quotas would, if it materialises, reduce GDP growth significantly. There is a renewed push for OPEC members, …
13th September 2019
South Africa, Nigeria stuck in the slow lane Q2 GDP data released this week supported our view that underlying growth in Africa’s two biggest economies remains weak. In Nigeria, surging oil production wasn’t enough to prevent headline growth from slowing …
6th September 2019
Mozambique: Debt deal is only the first step Even if bondholders agree to the government’s bond restructuring deal – as recent signs suggest they will – Mozambique’s debt problems will be far from over For one thing, the deal only covers the US$727mn …
30th August 2019
South Africa: Inflation opens window for rate cut News that South African inflation slipped to 4.0% y/y in July supported our view that policymakers at the SARB will cut their key rate to 6.25% in September. As we’d expected, falling petrol prices more …
23rd August 2019
Nigeria: President calls for tighter FX curbs President Muhammadu Buhari directed the CBN to further restrict importers’ access to the official FX market this week, raising fears that higher food prices would add to inflationary pressures. But the failure …
16th August 2019
ZAR: Currency weakness homegrown The South African rand had a tough time this week, shedding 2.3% against the US dollar. Indeed, the currency is now weaker than our end-year forecast of ZAR15/USD. But while this has coincided with a generalised fall in EM …
9th August 2019
Eskom: Between a rock and a hard place… While Eskom’s problems are often blamed on corruption and poor management, its recently-released annual report underlined the scale of the structural challenges facing the firm. Eskom faces the significant …
2nd August 2019
Eskom: Another bailout, still real solution A new cash injection for Eskom has underlined the scale of the firm’s problems and increased the risk of a sovereign rating downgrade in November. The government will grant another ZAR60bn in 2019/20 and 2020/21 …
26th July 2019
South Africa: More evidence of Q2 rebound Retail sales figures out this week strengthened our view that South Africa’s economy returned to growth in Q2. Based on the data released so far, we’ve pencilled in growth of 1.6% q/q saar. (See here .) Interest …
19th July 2019
South Africa: Steady as she goes at the SARB The re-appointment of South Africa’s respected central bank governor will help to allay fears concerning the independence of the Reserve Bank. Governor Lesetja Kganyago is a fierce defender of the bank’s …
12th July 2019
Nigeria: A change of heart on trade? Nigeria’s government finally agreed to join the AfCFTA this week, leaving Eritrea and Togo as the last two holdouts from the pan-African trade pact. While we think that the benefits of the deal have been oversold, it’s …
5th July 2019
China Trade Expo: Warm words, but few deals likely A high-profile meeting between Chinese and African leaders this weekend is unlikely to result in any significant trade announcements. One key goal of the first China-Africa Economic and Trade Expo is to …
28th June 2019