issue 523 | 19 Nov 2023
AfricaAfreximbank commits USD2-billion as partners sign agreement for Export Agriculture for Food Security Initiative
On 14 November, in Cairo, the African Export-Import Bank (Afreximbank) entered into a framework agreement for the Export Agriculture for Food Security (ExAFS) Initiative with ARISE Integrated Industrial Platforms and the Governments of Chad, Malawi, Zimbabwe and Egypt. The initiative seeks to improve food security in Africa. At a ceremony on the fifth day of the third Intra-African Trade Fair, Professor Benedict Oramah, president and chairman of the Board of Directors of Afreximbank, signed the framework agreement on behalf of the bank. Afreximbank, working with strategic partners and member countries, is facilitating the implementation of the ExAFS initiative by committing USD2-billion to boost production, processing and intra-African trade in agricultural products and provide African farmers and agribusinesses with opportunities to access larger markets across the continent.
AfricaAfreximbank launches Intra-African Engineering, Procurement and Construction Contract Promotion Programme as IATF2023 hosts Presidential Summit
On 13 November, in Cairo, the African Export-Import Bank (Afreximbank), launched a new initiative that will open doors, allowing African contractors to capitalise on various infrastructure investments available across the continent. Professor Benedict Oramah, president and chairman of the Board of Directors of Afreximbank, joined by Rania Al-Mashat, Minister of International Cooperation of Egypt, launched the Afreximbank Intra-African Engineering, Procurement and Construction (EPC) Contract Promotion Programme during the Presidential Summit of the Intra-African Trade Fair 2023 (IATF2023). Professor Oramah told guests that the programme was one of Afreximbank’s initiatives to support the implementation of the African Continental Free Trade Area, saying that it aimed to enable African companies to successfully bid for, win and execute infrastructure contracts in Africa through capacity building, twinning, market access opportunities, financing, guarantees, and technology solutions. “The EPC initiative will help African contractors to participate in the USD60-billion annual infrastructure investments within Africa, unlike the current practice where most of the contracts go to non-African entities,” he said.
AfricaAfDB, leaders commit to catalyse investment in cities as engines of the continent’s economic growth
African Development Bank (AfDB) president Akinwumi Adesina has pledged greater commitment to the development of cities and stressed the need for increased investment and autonomy for municipalities, the continent’s engine for economic growth. The AfDB chief spoke at a high-level forum for mayors titled: Leveraging Cities and Municipalities for National Development, held on the sidelines of the Africa Investment Forum 2023 Market Days in Marrakech, Morocco. The meeting, co-organised by the AfDB and Big Win Philanthropy, brought together mayors and governors of several major African cities including Lagos, Dakar, Addis Ababa, Abidjan, Kigali and Nairobi, and representatives of governments and financial and development institutions. “The Mayoral Forum launches what we hope is the beginning of new collaboration between financial institutions, cities, states and municipalities, to accelerate the growth and development of Africa,” Adesina said in his welcoming remarks. “It also shows the priority that the partners and investors in the Africa Investment Forum will place on improving investments in sub-national level projects,” he added. The session also included a presentation on a new report on African cities, titled: From Millions to Billions: Financing the Development of African Cities, commissioned by the AfDB.
AfricaAfrica Investment Forum 2023: Agribusiness, Africa's new wealth, should benefit from the attention of banks and institutional donors, experts say
Banks, institutional partners and the private sector should invest heavily in agribusiness in Africa, a sector that suffers from a financing gap just as it becomes the new manna for the countries of the continent, say experts. Their call was made on Thursday, 9 November 2023 at a panel discussion entitled Agribusiness: Unleashing Innovation and Unlocking Growth, organised as part of the Market Days of the Africa Investment Forum 2023 held from 8 to 10 November 2023 in Marrakesh, Morocco. Africa has enormous potential to feed its own population and the world, and agribusiness will be the engine of growth, sustainable development and job creation in Africa, said Adeel Malik, Professor of Development Economics at the University of Oxford, and Ms Mireille Esther Gninahophin, founder of Okedjenou. The panellists believe that to unlock the potential of African agribusiness requires investment in infrastructure, innovation and value chain development. Investment opportunities also exist in value-added processing, logistics and technology, as well as in resilient and sustainable supply chains that create jobs and foster inclusive economic growth.
AfricaAfrica Investment Forum secures USD34.82-billion in investor interest
The Africa Investment Forum's 2023 Market Days generated USD34.82-billion in investment interest for infrastructure, agriculture, health, and creative industry projects. The three-day global event, with the theme Unlocking African Value Chains, ended on Friday, 10 November in Marrakech, Morocco. The event drew over 1 000 delegates from more than 60 countries. “We are building a formidable powerhouse around investments in Africa, that will deliver transformative impacts on the lives of people. That is the bottom line of the Africa Investment Forum: investing to improve lives,” said African Development Bank (AfDB) Group president, and chairperson of the Africa Investment Forum, Akinwumi Adesina. Deals covered several sectors including the Mtwara-Mbamba Bay standard Gauge railway line in Tanzania, and the Mangapwani II Integrated Port in Zanzibar. There were also deals in agri-business, renewable energy, creative industries and healthcare.
AfricaAfrica must tackle huge infrastructure gap to unlock opportunities for transformation – Report
Africa’s significant road infrastructure deficit creates increased production and transaction costs that must be addressed to scale opportunities envisaged under the African Continental Free Trade Area, a new report has found. The report, titled: Cross-Border Road Corridors: Expanding Market Access in Africa and Nurturing Continental Integration, notes that while roads are the primary mode of transport, carrying 80% of goods and 90% of passenger traffic, only 43% of Africa’s main population has access to an all-season road. “Just 53% of roads on the continent are paved, isolating people from access to basic services, including healthcare, education, trade hubs and economic opportunities,” according to the publication, released at a special session of the Africa Investment Forum 2023 Market Days which took place in Marrakech, Morocco. The session, titled: Regional Corridors: Quest to Integrate Africa, featured a panel discussion on the strategic importance of regional corridors in connecting Africa. Panelists included government representatives, regional economic communities, development partners and private sector service providers.
AfricaAfrican shipowners to unveil regional shipping line by 2024
The co-Champion for Transportation of the African Continental Free Trade Area (AfCFTA) and Secretary General of the African Shipowners Association, Funmi Folorunsho, has revealed plans for the launch of an Africa shipping line in the first quarter of 2024 to foster economic growth and logistics efficiency across the continent. Addressing stakeholders at the 43rd yearly council meeting of the Port Management Association of West and Central Africa in Lagos recently, Folorunsho outlined the comprehensive blueprint for the regional shipping line. She emphasised the need for a robust fleet, noting that the target includes a 188% increase in bulk vessels and a planned 180% surge in container vessels. This expansion, according to her, aims to accommodate the anticipated surge in maritime transport volume, projected to soar from nearly 58 million to 131.5 million tonnes. To facilitate the seamless operation of the shipping line, Folorunsho shed light on the financing mechanisms, which include tapping into funds generated through the AfCFTA African Cargo for Africa Ships programme. Others are engaging the private sector, collaborating with the African Export-Import Bank, and exploring partnerships with existing shipping lines in the region.
Source: The Guardian
East AfricaEast African states agree on regional payment system
East African member states have agreed to fast track a cross-border payment system to boost trade and cut cross border money transfer costs. This was revealed during the four-day Regional Meeting of the ICT Infrastructure Development Cluster, part of the Northern Corridor Integration Projects, that ended in Nairobi, Kenya, on Thursday, 9 November. According to the joint communique issued after the meeting, technical teams from the East African Community member states agreed to harmonise their policies to support the regional cross-border payment system. The system will streamline and secure various forms of electronic payments, including online transfers, and mobile payments. Dr Aminah Zawedde, Uganda’s Permanent Secretary in the Ministry of ICT and National Guidance, who also doubles as the technical chair of the ICT Infrastructure Development Cluster, said once in place, the system will allow regional nationals to pay for goods and services in local currencies using merchant codes.
Southern AfricaSADC, EU, and German Cooperation facilitate the regional Business-to-Business and Business-to-Finance Forum on unlocking medical and pharmaceutical opportunities in Southern Africa
The Southern African Development Community (SADC), the European Union (EU), and the German Government have successfully facilitated a two-day Business-to-Business (B2B) and Business-to-Finance (B2F) event in Gaborone, Botswana, from 14 to 15 November 2023. The event was officiated by Ms Barbara Chibambo, Programme Coordinator Support to Industrialisation and Productive Sectors at the SADC Secretariat and Mr José-Angel Becerra-Marta, Programme Officer at the EU Delegation in Botswana. Representatives from a diverse array of over 59 companies, including financial institutions, medical manufacturers, and procurement entities, converged at the SADC regional B2B and B2F Forum. Hailing from more than 10 Southern African countries, the participants contributed to the vibrant exchange of ideas and experiences. The core focus of the B2B and B2F forum was on unlocking opportunities in the medical and pharmaceutical sectors within the SADC region to create linkages along these value chains.
ChadWorld Bank: boosting growth and reducing vulnerability in Chad
Chad's economy is facing multiple, and often interrelated challenges that have slowed down its growth, according to the latest Chad Economic Memorandum titled: Boosting growth and reducing vulnerability published by the World Bank. Furthermore, up to 3.34 million additional people in Chad could fall into poverty by 2050, due to shocks linked to climate change, if urgent adaptation measures are not put in place, as estimated by the same institution in the Country Climate Change and Development Report for the G5 Sahel countries: Mauritania, Burkina Faso, Mali, Niger, and Chad. These two reports will be presented respectively on 13 and 14 November 2023 during an event attended by representatives from the government, the private sector, civil society, and academia. The country economic memorandum identifies insecurity, over-reliance on oil revenues and failure to use those revenues to bolster broad-based economic growth, climate change and variability, weak public finance management and business environment, as well as limited physical and human capital, as the country’s main growth constraints.
Source: World Bank
EthiopiaEthiopia opens up more sectors as exchange readies for launch
Ethiopia is planning to ease its restrictions on participation of foreigners in its domestic financial markets as it prepares to launch its local currency securities exchange platform next year. The country has in the last two years opened up its telecommunications and banking sectors to participation of foreign firms, allowing Kenyan telecommunications company Safaricom and bank KCB to set up operations there. Other sectors have remained restricted, with only locals and Ethiopian diasporas allowed to invest or operate businesses in them, a factor which has greatly limited participation of foreigners in the country’s financial markets. Brook Taye, director-general of the Ethiopian Capital Markets Authority, told journalists that the country is working on liberalising “many other different sectors” after opening up its banking and telecommunications sectors.
Source: The EastAfrican
GabonFour banks disburse EUR123-million for the Kinguélé Aval hydroelectric dam
In Gabon, the Kinguélé Aval hydroelectric project has received its first disbursement of F.CFA81-billion. The funding has been raised by four lenders to the project, which is being developed under a public-private partnership. The financing of F.CFA81-billion (EUR123.4-million) is being provided by the African Development Bank, the Development Bank of Southern Africa, the Emerging Africa Infrastructure Fund of the Private Infrastructure Development Group and the International Finance Corporation, the World Bank Group’s private sector financing arm. “Obtaining this first drawdown from international lenders reflects the confidence of these financial institutions in our project and our ability to make a positive and lasting difference to the daily lives of thousands of Gabonese,” says Sylvain Bouyé, managing director of Asonha Energie, the company developing the project. The dam currently under construction on the Mbéi River, 90 km from the Gabonese capital Libreville, will have an installed capacity of 35 MW. Asonha Energie estimates the annual production capacity of the hydroelectric plant at 205 GWh. This is equivalent to 13% of the electricity consumed in the city of Libreville.
Source: AFRIK 21
GhanaIMF staff concludes Governance Diagnostic for Ghana
At the request of the Ghanaian authorities, an International Monetary Fund (IMF) Technical Assistance mission led by Gomiluk Otokwala visited Accra over the period 16-27 October 2023 to conduct a Governance Diagnostic. The Governance Diagnostic aims to support the authorities’ own efforts under the Post COVID-19 Program for Economic Growth to address gaps in the country’s governance systems, to promote the efficiency of public spending, enhance competitiveness, and lay the foundations for higher and more inclusive growth. The mission (comprising staff from the Legal, the Fiscal Affairs and the Monetary and Capital Markets Departments of the IMF) assessed the scope and strength of the governance and anti-corruption framework in Ghana, identified the gaps, and offered reform options, as guided by the IMF’s Framework for Enhanced Engagement in Addressing Governance Weaknesses. Collaboration on the Governance Diagnostic will continue until the exercise concludes with the finalisation of a report, setting out the findings in detail as well as recommendations, which is expected to be finalised in the first quarter of 2024.
KenyaIMF reaches staff-level agreement on sixth reviews of the EFF and ECF arrangements and the first review under the RSF, and concludes 2023 Article IV consultation with Kenya
A staff team from the International Monetary Fund (IMF), led by Haimanot Teferra, visited Nairobi from 30 October to 15 November 2023, and held discussions with the Kenyan authorities for the 2023 Article IV consultation, the sixth reviews of Kenya’s economic programme supported by the IMF’s Extended Fund Facility (EFF) and Extended Credit Facility (ECF), and the first review under the Resilience Sustainability Facility (RSF). The EFF/ECF arrangements were approved by the IMF Executive Board on 2 April 2021 and extended by 10 months on 17 July 2023 to support Kenya in maintaining robust and inclusive growth while preserving macroeconomic stability and debt sustainability. The SDR407.1-million RSF was approved by the IMF Executive Board on 17 July 2023 to support Kenya’s ambitious efforts to build resilience to climate change. The mission also considered Kenya’s request for augmentation under the EFF/ECF arrangements. If approved by the Executive Board of the IMF, including augmentations, the EFF/ECF arrangements would provide access to a total amount of SDR2.93-billion (about USD3.88-billion at current exchange rate). Under the EFF/ECF augmentations and the RSF support, the total IMF commitment under these arrangements over the duration of the programme would be SDR3.34-billion (about USD4.43-billion).
KenyaKenya agricultural commodities exchange goes live next February
Kenya’s planned agricultural produce exchange is scheduled to go live in February next year, the Trade and Investment Ministry said in a disclosure. The ministry said the Kenya National Multi Commodities Exchange (KOMEX) is scheduled to commence mock trading on 29 January 2024 and go live on 26 February 2024. “The key objective of the KOMEX project is to provide regulated access to structured trading of multi-commodities, market information, domestic and international markets, trade finance, and trade support services for sector regulators and value chain actors (farmers/producers, aggregators, traders, consumers, and processors),” it said. The commodities exchange will be an online marketplace where buyers and sellers can trade in commodities with an assurance of quality, delivery, and payment. “The exchange is committed to ensuring that the market is assisted with a modern market institution that will bring in much-needed integrity, by providing a guarantee mechanism, for quality, quantity, and payment,” the ministry said. “Further, it will make the market efficient by introducing standardised contracts and trading systems,” it added.
Source: Business Daily
MalawiIMF Executive Board discusses the second review under Malawi’s Staff Monitored Program with Executive Board Involvement and approves a 48-month arrangement under the ECF
The Executive Board of the International Monetary Fund (IMF) discussed the second review of the Staff-Monitored Program with Executive Board Involvement and approved a 48-month arrangement under the Extended Credit Facility (ECF) for Malawi with access of 95% of quota, equivalent to SDR131.86-million (about USD175-million). The decision allows an immediate disbursement of SDR26.37-million (about USD35-million). Malawi has struggled to sustain growth for decades despite large inflows of official development assistance. The past three years have been particularly difficult with stagnating growth and widening macroeconomic imbalances due to unsustainable debt and the effects of multiple shocks, including an outbreak of cholera and cyclone Freddy this year alone. The ECF arrangement aims to support the authorities’ commitment to restore macroeconomic stability, build a foundation for inclusive and sustainable growth, including to strengthen resilience to climate-related shocks, and address weaknesses in governance and institutions. The arrangement is also expected to catalyse grant financing and capital inflows including foreign direct investment and trade credit.
RwandaRwanda's biggest port to open in December
The inland Port of Rubavu which is expected to boost cross-border trade with Rwanda’s neighbour on the other side of Lake Kivu, the Democratic Republic of the Congo (DRC), will begin operations in December. The Acting Mayor of Rubavu district, Déogratias Nzabonimpa, said a provisional handover is scheduled for 30 November. "The port is 96% complete with some ongoing finishing works. It will be handed over by the end of the month and the first ship, if available, will be allowed to access it by 1 December," Nzabonimpa said. The port spans an area of two hectares. It will reduce the costs of trade flows along the lake, Africa’s eighth largest water body and biggest supplier of fish to Rwanda, as well as bolster the region as a tourism destination, he said. According to Société Centrale Pour l'équipement du Territoire, the company overseeing the construction of the project, the facility has a cargo and passenger terminal designated for both the business and tourism sectors. Developed by the Government of Rwanda through the Rwanda Transport Development Agency, with the support of TradeMark Africa and Invest International, the port cost USD7.8-million.
Source: The New Times
São Tomé and Príncipe / BurundiSão Tomé and Príncipe, Burundi expand AFC membership to three-quarters of the continent
Africa Finance Corporation (AFC), the continent’s leading infrastructure solutions provider, announced Burundi and São Tomé and Príncipe as its newest member countries, expanding its community of sovereigns to 42 African nations. Despite significant macroeconomic headwinds, the AFC has doubled its membership in the last five years, strengthening its mandate to resolve regional challenges and catalyse private sector-led infrastructure development across Africa. The onboarding of Burundi expands the AFC’s footprint in East Africa following the recent memberships by South Sudan, Ethiopia, and Somalia and legacy memberships by Kenya, Uganda, Rwanda, Djibouti, and Eritrea. The AFC is now applying its experience in infrastructure development and financing to support Burundi’s National Development Plan to modernise and diversify the land-locked economy, including growth-enhancing sectors such as mining, transportation, logistics, and energy. Burundi’s Minister of Finance, Budget, and Economic Planning, Audace Niyonzima, said, “I am delighted that Burundi has joined the membership of the AFC. This decision is not only a milestone for our country but also an opportunity for us to foster sustainable economic growth and develop our infrastructure leveraging the AFC’s vast network and reach across the continent.”
UgandaServices remain the largest contributor to GDP, says UBOS
Services contribute almost half of Uganda’s GDP, according to data from the Uganda Bureau of Statistics (UBOS). Data indicates that the services sector has for years continued to be the biggest contributor to GDP, with a share of 42.4% in the 2022/23 financial year. This was a 0.7 percentage growth from the 41.7% that the sector contributed in the 2021/22 financial year. The services sector comes ahead of industry, whose contribution reduced to 26% from 26.8% in the 2021/22 financial year, while agriculture contributed 23.8%, which was lower than the 24% registered in 2021/22. Dr Chris N Mukiza, the UBOS executive director, said during a press briefing that in terms of gross value, agriculture, forestry, and fishing activities registered a growth of 4.8% compared to 4.2% due to good performance in food crop growing, which registered a growth of 4.7% and livestock activities, which registered a growth of 8.6%. However, he said the performance was undermined by poor performance in cash crop growing activities, which declined by 0.1% compared to a 5.7% growth in the 2021/22 financial year.