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issue 380 | 29 Nov 2020

Coronavirus (COVID-19)

A non-exhaustive list of recent measures aimed at curbing the spread of Coronavirus (COVID-19)

Africa: As the race to find a safe and effective COVID-19 vaccine is showing increasing promise, a new World Health Organization (WHO) analysis finds that Africa is far from ready for what will be the continent’s largest ever immunisation drive. All 47 countries in the WHO African Region have received the WHO’s Vaccine Readiness Assessment Tool which is intended to be used by Ministries of Health, with support from WHO and the the United Nations Children's Fund (UNICEF). It provides a roadmap for countries to plan for COVID-19 vaccine introduction and covers 10 key areas: planning and coordination, resources and funding, vaccine regulations, service delivery, training and supervision, monitoring and evaluation, vaccine logistics, vaccine safety and surveillance and communications and community engagement. Forty countries have updated the tool and provided data to WHO. An analysis finds that based on the self-reports by the countries, the African region has an average score of 33% readiness for a COVID-19 vaccine roll-out, which is well below the desired benchmark of 80%.

Source: WHO

Africa: High-level officials representing a range of African economies met under the theme of ‘Securing Africa’s Energy Future in the Wake of COVID-19’ at the second African Union Commission-International Energy Agency (AUC-IEA) Ministerial Forum. Recognising the severe impact of the COVID-19 crises on African economies and the importance of the energy sector for continued economic development across the continent, participants agreed on the urgent need to enhance actions which will ensure sustainable economic recovery and significantly scale up energy investment over the next three years. Participants underscored that Africa is facing major challenges in obtaining financing and new investment required to meet immense structural transformation needs. Addressing infrastructure needs is essential to ensuring a resilient and dynamic energy sector that can power a successful economic recovery.

Source: ESI Africa

East Africa: When the COVID-19 pandemic sent the global economy into a recession, the East African region was not spared. According to the United Nations Economic Commission for Africa’s (ECA) ‘Economic and Social Impacts of COVID-19 in Eastern Africa’ report, the region’s labour market has been the worst hit on the continent, with an estimated 38 million jobs lost. Presenting the report during the 24th Meeting of the Intergovernmental Committee of Senior Officials and Experts, Ms Mama Keita, head of ECA in Eastern Africa, said that the region will barely grow in 2020 with only four countries on track to experience positive growth in 2020. South Sudan leads with 4.1% gross domestic product (GDP) growth, followed by Ethiopia and Tanzania with close to 2% and Kenya with 1%. Eastern Africa’s growth will slow down considerably to 0.6% in 2020 from 6.6% in 2019. The report urges policymakers in Africa to harness digitalisation and digital trade as the pandemic has highlighted the importance of the digital economy.

Source: ECA

Kenya: Kenya’s central bank held its key interest rate for the fifth straight meeting as the impact of the COVID-19 pandemic in East Africa’s largest economy started easing in the second half of the year. The Monetary Policy Committee maintained the rate at 7%, Governor Patrick Njoroge said. As part of COVID-19 relief measures, policymakers cut rates by 1.25 percentage points and reduced banks’ cash reserve ratio to boost credit to businesses and households. The policy steps are having the intended impact on the economy, Njoroge said. The nation’s Treasury forecasts less robust expansion of 0.6%, before a rebound to 6.4% next year.

Source: Bloomberg

Namibia: Namibia has approved an upfront payment of NAD26.4-million (USD1.7-million) to the COVAX global COVID-19 vaccine distribution scheme, senior health ministry official Ben Nangombe told Xinhua on Thursday, 26 November. Nangombe said the arid Southwest African nation plans to make the payment soon, which will give it access to COVID-19 vaccines for 20% of its population. He said the COVAX facility provides good value for money because other vaccines may require complicated cold chain management systems. Unlike many other African countries, Namibia does not qualify for subsidised vaccines under the COVAX scheme because it is classified as an upper-middle-income country like its neighbours South Africa and Botswana. Namibia has reported relatively low COVID-19 cases at just over 14,000 with 147 deaths, but its mining and tourism-dependent economy has been severely impacted by the pandemic.

Source: Xinhua

World

IRENA and GWEC enhance cooperation to scale up renewables globally

The International Renewable Energy Agency (IRENA) and the Global Wind Energy Council (GWEC) signed a cooperation agreement in order to join efforts aimed at increasing the adoption and deployment of wind and renewable energy worldwide. Among other areas, the enhanced cooperation between IRENA and GWEC will focus on: strengthening wind energy project facilitation in the Climate Investment Platform; engaging the wind industry in industry-government dialogues, investment forums and other arenas for knowledge exchange; and exploring open-source agreements and project templates for wind projects in emerging markets in order to mitigate legal risks and barriers. The parties agree to work collaboratively to minimise regulatory, legal and administrative barriers to investment in wind and renewable energy, and enhance international dialogues and actions on increasing the share of renewable energy in the global energy mix.

Source: IRENA

World

New responsible supply chains partnership launched

Lithium-ion battery developer and manufacturer Contemporary Amperex Technology Co. Limited (CATL) and RCS Global Group have launched a landmark responsible sourcing partnership. The partnership currently covers CATL’s cobalt, lithium and graphite suppliers but the partnership will also expand to cover aluminium, copper-manganese and nickel suppliers in the future. Under the scope of the partnership, RCS Global’s industry-leading environmental, social and governance (ESG) audit practice will identify CATL’s suppliers from battery to mine or recycler. RCS Global will also assess these suppliers for conformance with environmental and human rights requirements and work with CATL and the suppliers to enhance the development of a responsible supply chain. In cooperation with RCS Global, CATL has already completed due diligence audits on its suppliers for stakeholders.

Source: Mining Review Africa

Angola

Angola plans to sell stakes in state companies to raise funds

Angola plans to start a partial disposal of national oil company Sonangol and diamond firm Endiama by the end of 2021 or early 2022, possibly through initial public offerings, finance minister, Vera Daves de Sousa said. The sale is part of a push by Africa’s second-biggest oil producer to raise cash and jump-start a moribund economy. Angola has so far sold 30 companies through a program that runs through 2022. It is currently selling stakes in an insurance firm and a commercial bank out of 195 assets earmarked in the plan. Angola’s negotiations with its main creditors to reschedule debt payments have been “good” and will eventually allow the country to have more room to carry out investments needed to revive the economy, she said. The country will only attempt to sell Eurobonds once the market has more confidence in the government’s ability to service its debt. Angola will wait until the market “starts trusting again,” Daves de Sousa said.

Source: Bloomberg

Eswatini

Eswatini’s central bank keeps policy rate at 3.75% as overall inflation remains moderate

The Central Bank of Eswatini, in consultation with the Monetary Policy Consultative Committee (MPCC), decided to leave its policy rate unchanged at 3.75% throughout November. Year-on-year (y/y) inflation is trending upwards. Headline inflation in October ticked up to 4.7% y/y from 4.1% y/y in September, driven by higher prices for food and non-alcoholic beverages (4.4% y/y); housing and utilities (6.4% y/y); and furnishing and housing equipment (5.2% y/y). Consequently, the central bank has revised its average annual inflation forecasts for 2020 and 2021 upwards, to 3.84% y/y (from 3.74% y/y) and 5.23% y/y (from 4.34% y/y), respectively. In the second quarter of 2020, Eswatini’s economy declined by 8.2% y/y (seasonally adjusted), following the 3.6% y/y contraction in the first quarter of 2020. According to the monetary policy statement, the decline “was largely attributed to poor performance in all three sectors of the economy, especially severe in the secondary sector, which further contracted by a significant 24.5% y/y in the second quarter of 2020, from a 16.4% y/y contraction recorded in the first quarter”. Private-sector credit weakened by 0.4% due to weak credit extension to households (down 1.2% month on month (m/m)) and the business sector (down 0.3% m/m).

Source: IHS Markit

Ghana

Bank of Ghana keeps 14.5% policy rate unchanged for 4th consecutive time

The Monetary Policy Committee (MPC) of the Bank of Ghana (BoG) has kept its monetary policy rate unchanged at 14.5% for a fourth consecutive time this year. The decision, according to the central bank, is attributed to growth indicators improving and reserve buffers remaining strong. Addressing journalists at a press conference on Monday, 23 November, Governor of the Bank of Ghana, Dr Ernest Addison explained inflation has edged closer to target with the economy gradually rebounding faster than expected. "The fiscal and monetary policy measures, which have increased liquidity in the economy, appear not to be impacting inflation, partly due to the existence of the output gap. As a result, the Committee expects these conditions to support inflation to return to its central path by the second quarter of 2021," Dr Addison told journalists. This will be the central bank's last MPC decision under the Akufo-Addo-led administration ahead of the upcoming 2020 general elections.

Source: GhanaWeb

Ghana

Petroleum hub project includes industrial parks to boost value-addition

The Petroleum Hub Development Corporation, whose law was passed by Parliament in October, is expected to facilitate the establishment of industrial parks aimed at promoting the manufacture of downstream petrochemical and chemical products. The corporation, which will oversee and coordinate the development of a petroleum hub in Ghana, will also establish a mechanism to ensure the transfer of skills and knowledge to Ghanaians engaged in activities in the petroleum sector. Ghana is expected to rake in USD1.56-billion in export tax revenue by 2030 from the development of the hub, which will add value to the country’s petroleum resources. The development of the hub will include the construction of key infrastructure such as jetties, storage tanks, refineries, a liquefied natural gas (LNG) facility, power plants, and infrastructure for offshore activities. The hub will drive the growth of various industries, including petrochemicals, and create 780,000 direct and indirect jobs. Government is expected to contribute USD6-billion of the total investment target of USD60-billion, with private capital providing the remainder.

Source: GhanaWeb

Ghana

Report on nuclear power programme submitted to cabinet

A comprehensive report on Ghana’s nuclear power programme has been developed and submitted to cabinet for approval, the Nuclear Power Institute (NPI) of the Ghana Atomic Energy Commission (GAEC) has revealed. The NPI director, Dr Seth Debrah, who disclosed this, said if the government gave the green light, feasibility studies would formally begin for the construction of the country’s first nuclear power plant. Compiled between 2019 and this year, he said the technical report contained all issues related to the construction of the plant including financing, procurement, stakeholder involvement, gaps identified and recommendations. According to Dr Debrah, while awaiting for response from the government on the submitted report, feasibility studies had begun informally, and was expected to be completed within four years. The number of plants to be constructed, he said, would be determined by the government, adding that a site had been identified for the construction of the plants which are expected to generate about 1,000 MW of power.

Source: Ghanaian Times

Kenya

Kenya bets on portal to drive exports by 6.5%

Kenya is banking on a new e-commerce platform to drive its exports through linkage of local traders with buyers abroad amid restrictions on physical travel due to COVID-19. The Kenya Export Promotion and Branding Agency said it targets grow the country’s annual exports by about 6.5% over the next two years, aided by more efficient virtual transactions. The scheme targets manufacturers, farmers, traders, small and medium enterprises, marketing agencies and international buyers, including importers, agents, retailers and wholesalers. Kenya’s exports receipts grew by 6% to KES479.7-billion in the nine months to September, defying the economic knocks of the COVID-19 pandemic, data by the Kenya National Bureau of Statistics shows. The strong earnings performance was linked to foods and beverages exports, which accounted for 47% of total export receipts. Over the same period in 2019, exports earnings were booked at KES449.6-billion.

Source: Business Daily

Kenya

Kenya to promote business tourism to diversify sector revenues

Kenya plans to promote conference tourism in order to diversify revenue from the sector, an official said on Thursday, 26 November. Jacinta Nzioka, CEO, Kenya National Convention Bureau (KNCB) told journalists in Nairobi that business travel on average accounts for about 16% of all international arrivals into the country. "We aim to leverage on Kenya's position as a regional business hub to increase the number of international conferences held in the country," Nzioka said during a stakeholder forum to launch the country's first convention bureau blueprint. She said that a vibrant business tourism sector will help reduce reliance on the safari and beach attractions to lure more foreign visitors to Kenya. She said that conference tourism is a high yield sector because of its numerous backward linkages to other sectors of the economy and can also be combined with leisure tourism.

Source: Xinhua

Lesotho

Lesotho’s central bank holds policy rate at 3.5% as growth shows signs of recovery

The Central Bank of Lesotho (CBL) has left the policy rate unchanged at 3.5% with the economy showing signs of recovery, although uncertainty remains high. Annual inflation decelerated to 5.6% year-on-year (y/y) in October from 5.9% y/y in September, driven by softer “food and non-alcoholic beverages” and “clothing and footwear” prices. The rate of inflation in 2020 is expected to average 5% and the outlook for 2021 and 2022 also remains benign, with inflation projected at 5.2% and 5.3%, respectively. The CBL has upgraded its expectation for gross domestic product in 2020 from a contraction of 6.4% to a decline of 6%, due to a slightly less severe economic fallout from the COVID-19 pandemic than initially anticipated. The downturn in output will be driven by expected weakness in the textiles and clothing industry, construction industry, and mining industry. Over the period 2021–22, growth is projected to grow at an average rate of 4.3%, dependent on positive developments related to containment of the COVID-19 virus. The central bank highlights that the leading industries in the recovery will be mining and construction.

Source: IHS Markit

Malawi

Cannabis regulations excite stakeholders

Government has partially gazetted the Cannabis Regulations which seek to guide licensing, production and marketing of cannabis for medicinal and industrial use. Minister of Agriculture, Lobin Lowe gazetted the regulations on 20 November 2020. The Cannabis Regulatory Authority (CRA) acting registrar, Ketulo Salipira confirmed in an interview that the partial gazette of the regulations was done quickly to allow production this growing season. This will be the first time that Malawi will join other nations in producing industrial and medicinal cannabis touted to be among lucrative cash crops grown in the country. Salipira said, “the partially gazetted regulations will allow interested stakeholders to start applying for production, marketing, storage and processing licences. We will soon publish a call for applications for licences as specified in the regulations.”

Source: The Nation

Nigeria

CBN retains MPR at 11.5%, holds other parameters constant

The Monetary Policy Committee (MPC), of the Central Bank of Nigeria (CBN), has voted unanimously to keep the Monetary Policy Rate (MPR) at 11.5%. This was disclosed by Governor of the CBN, Godwin Emefiele while reading the communiqué at the end of the MPC meeting on Tuesday, 24 November. Other parameters such as Cash Reserve Ratio (CRR), liquidity ratio, and asymmetric corridor remain unchanged. The Committee noted that inflation continued to be driven by supply-side disruptions arising from the COVID-19 pandemic and other legacy factors. Key amongst these are the security challenges in parts of the country; the increase in food prices; and the recent hike in the pump price of premium motor spirit (PMS) and electricity tariff. The MPC emphasised the need to address structural supply-side issues putting upward pressure on costs of production and unemployment. The decision of the central bank to retain the MPR, despite a rise in inflationary pressure, indicates that the apex bank aims to expand credit to the real sector at low interest rates.

Source: Nairametrics

Nigeria

Investors commit billions at Lagos Free Zone in Nigeria

Lagos Free Zone (LFZ), the first privately owned special economic zone in Nigeria with an integrated deep sea port and located 65kms east of Lagos in the immediate vicinity of upcoming Lekki Deep Sea Port, aims to enhance the ease of doing business in Nigeria. Developed by the Singapore-based Tolaram Group, the LFZ reflects their more than four decades of commitment to doing business in Nigeria, says Tejaswi Avasarala, general manager, Strategic Marketing, LFZ. With currently more than 15 operational entities, the 830-hectare LFZ site will eventually host more than 100 businesses. In addition to the industrial manufacturing and port-based logistics cluster at LFZ, there are opportunities in the area of commercial developments such as multi-tiered housing, office spaces, business and leisure hotels, as well as healthcare and educational projects.

Source: Africa Business Communities

Nigeria

Nigerian economy slips into recession as GDP contracts by 3.62% in Q3 2020

Nigeria’s domestic product (GDP) in real terms declined by 3.62% year-on-year (y/y) in Q3 2020, thereby marking a full-blown recession and second consecutive contraction recorded in the previous quarter (Q2 2020). This is according to the Q3 2020 GDP report, released by the National Bureau of Statistics (NBS) on Saturday, 21 November. According to the report, the performance of the economy in Q3 2020 reflected residual effects of the restrictions to movement and economic activity implemented across the country in early Q2 in response to the COVID-19 pandemic. In Q3 2020, the oil sector contracted by 13.89% y/y. The sector contributed 8.73% to total real GDP in Q3 2020, down from 9.77% and 8.93% respectively recorded in the corresponding period of 2019 and the preceding quarter, Q2 2020. Nigeria’s non-oil sector contracted for the second time as the economy continues to reflect the impact of the COVID-19 pandemic. In Q3 2020, the non-oil sector grew by 2.51% in real terms. Key sectors that contracted in Q3 2020 in the non-oil segment are manufacturing, trade (wholesale and retail) accommodation and food services, and real estate, among others. The growth in the non-oil sector was driven mainly by telecommunications, agriculture, construction, finance and insurance.

Source: Nairametrics

Rwanda

Rwanda to host continental export development fund

A new fund that was created by the African Export-Import Bank (Afreximbank) last year, the Fund for Export Development in Africa (FEDA), will have its permanent headquarters in Rwanda. This follows the signing of three agreements between Rwanda and Afreximbank on Sunday, 22 November 2020 in Egypt, which paves way for the establishment of FEDA headquarters in Kigali. FEDA, an equity investment fund and a subsidiary of Afreximbank, seeks to fund African businesses to promote intra-African trade, and facilitate foreign direct investment flows into Africa’s trade and export sectors. Alfred Kalisa, Rwanda’s Ambassador to Egypt signed the Establishment Agreement, a Headquarters Agreement, and a Memorandum of Understanding (MoU) on behalf of Rwanda with Afreximbank’s President, Professor Benedict Oramah. The Establishment Agreement is similar to a multilateral treaty that each member state will sign, while the Headquarters Agreement is a bilateral agreement that enables FEDA to have its offices in Rwanda. The MoU, on the other hand, is an agreement that sets out specific commitments by the government of Rwanda towards FEDA, including provision of free rent and land.

Source: The New Times

Seychelles

Seychelles ratifies the Treaty for the establishment of the African Medicines Agency (AMA)

The Republic of Seychelles became the fourth African Union (AU) member state to ratify the Treaty for the establishment of the African Medicines Agency (AMA) on 13 August 2020, in Victoria, Seychelles and deposited the instrument of accession to the Chairperson of the AU Commission on 23 November 2020 in Addis Ababa, Ethiopia. The AMA will enter into force once ratified by 15 AU member states. The AMA will serve as the continental regulatory body that will provide regulatory leadership, to ensure that there are harmonised and strengthened regulatory systems, which govern the regulation of medicines and medical products on the African continent. The Agency will provide regulatory oversight through strengthened regulatory guidance and the coordination of ongoing regulatory initiatives in order to improve access to safe, effective, good quality and affordable essential medicines, medical products and health technologies.

Source: AU

Zambia

Fitch downgrades Zambia’s credit risk rating to RD

International ratings agency, Fitch Ratings has downgraded Zambia’s long- and short-term foreign-currency issuer default ratings to Restricted Default (RD), following the expiry of a 30-day grace period for the coupon payment on the country’s USD1-billion Eurobond maturing in 2024. Fitch expects that Zambia will default on its remaining Eurobond commitments in due course, “either as the sovereign misses debt service payments or as an agreement is reached on restructuring the bonds”, states the rating agency. Two more Eurobond coupon payments are due on 30 January and 20 March 2021, besides the missed coupon payment on 14 October 2020. The Zambian Ministry of Finance issued a warning on 13 October stating that the government was facing “considerable challenges and liquidity difficulties compounded by COVID-19” that forced the authorities to issue a “consent solicitation” to bondholders and to seek debt-service suspension through the G20’s Debt Service Suspension Initiative (DSSI). Bondholders rejected the offer made by the Zambian authorities. The focus will now be placed on servicing foreign-currency-denominated debt from multilateral agencies and debt on a few priority projects with immediate social and economic impacts, the Zambian Ministry of Finance reported.

Source: IHS Markit

Zimbabwe

Zimbabwe starts repossessing under-utilised farms

The Zimbabwean government has started the process of repossessing under-utilised, vacant and abandoned farms to ensure that land is fully utilised. Speaking during the launch of a traditional agricultural social security scheme in Zvishavane, southern Zimbabwe, Lands, Agriculture, Water and Rural Resettlement minister, Anxious Masuka said government has started implementing the one-man one-farm policy so that landless Zimbabweans can be allocated land. "Government will… start the exercise of repossessing land from multiple-farm owners, those who have abandoned the land and those who are underutilising the land. The repossessed land will be allocated to the landless as we push to achieve the agricultural revolution aimed at making the country food secure," said Masuka. Masuka said multiple-farm owners will be left with one farm, those underutilising the land will lose the portion that is not being utilised, and that abandoned or vacant land will be repossessed. According to Masuka, farmers who were allocated A1 and A2 farms but have no capital to embark on meaningful production will be allowed to go into joint ventures subject to government approval.

Source: Xinhua

Zimbabwe

Zimbabwe targets USD8-billion industrial and commercial sector

Zimbabwe has set a target of achieving an USD8-billion industrial and commercial sector by 2023 with cabinet approving the ambitious roadmap. The growth of the industrial and commercial sector would be boosted by a number of investments scheduled for implementation under the roadmap, since it is private-public-sector-led. These include 23 planned investments amounting to USD545-million in the food, drink and tobacco sub-sectors; USD32-million investments in the textiles, clothing and leather sub-sectors; and a total of eight projects with an investment value of USD1.5-billion in the metals and electrical sub-sectors. “Cabinet considered and approved the Roadmap to a USD8-billion Industrial and Commercial Sector by 2023,” said Environment, Climate, Tourism and Hospitality minister, Mangaliso Ndlovu, in a post-cabinet media briefing. “The Roadmap outlines the plan to raise the manufacturing and commercial sector contribution to gross domestic product (GDP) from the current USD7.16-billion to USD8.03-billion by 2023, through the sector’s diversified 94 sub-sectors. In the interim, the sector contribution to GDP is projected to grow to USD7.4-billion in 2021 and USD7.7-billion in 2022.”

Source: Chronicle