Africa

The International Monetary Fund's executive board has approved a long-awaited $3 billion bailout for Ghana in hopes of combating the country’s economic crisis, the Associated Press reported. The arrangement will allow for the immediate release of $600 million, with the remaining funds to be made available over the course of the next three years, the IMF said in a statement Wednesday. Facing soaring inflation, high debt and a weakening currency, Ghana's government began negotiations with the IMF last July for a bailout package.

Ghana's official creditors have formed a committee co-chaired by China and France to launch debt restructurings talks, the Paris Club said on Friday, paving the way for a sign-off on a $3 billion International Monetary Fund loan for the country, Reuters reported. The West African nation is struggling through its worst economic crisis in a generation, defaulting on most of its external debt in December and completing a domestic debt exchange in February.

The International Monetary Fund is in discussions with Ethiopian authorities, and any new program would require creditors' financial assurances, a spokeswoman said on Thursday, Reuters reported. The fund "welcomed" the progress toward restoring lasting peace in the East African country as well as the authorities' "homegrown economic reform agenda," said spokeswoman Julie Kozack in a scheduled press conference.

The International Monetary Fund’s chief capped a visit to Kenya with an enthusiastic endorsement of its economic management and expressed confidence that the cash-strapped nation would keep servicing its debts, Bloomberg News reported. Kristalina Georgieva said that in the IMF’s assessment, Kenya’s debt is sustainable and the administration of President William Ruto is moving swiftly to improve its fiscal position. The remarks come at a sensitive time for the East African nation, with some investors dumping its bonds and questioning its ability to make a $2 billion payment next year.

Nigeria’s debt burden is poised to jump 50% after lawmakers approved President Muhammadu Buhari’s request to convert 22.7 trillion naira ($49 billion) in loans from the central bank into bonds, Bloomberg News reported. The Senate’s acceptance is expected to push the West African nation’s official debt-to-gross domestic product ratio toward a 40% limit set by the government. “The advances were made to ensure that the government does not shut down,” according to a report by a special committee that the upper chamber of parliament endorsed on Wednesday.

Nigeria’s Securities and Exchange Commission is processing applications for digital exchanges on a trial basis in a bid to widen market participation in Africa’s most populous country where the central bank restricts trading in cryptocurrencies, Bloomberg News reported. The SEC is considering permitting tokenized coin offerings on licensed digital exchanges that are backed by assets including equity, debt, property but “not crypto,” Abdulkadir Abbas, head of securities and investment services at the Abuja-based commission said in an interview in Lagos.

Some investors of Ghana's 2030 Eurobond have received coupon payments which had been due on April 14, Reuters reported. The country announced it would default on some its external debt in December and has not made payments on its international bonds since. However, the bond maturing in 2030 with a coupon of 10.75% is partially guaranteed by the World Bank, so payment kicked in this week via the bank's International Development Association.

Zimbabwe plans to keep its local currency as legal tender, even as the US dollar is now the unit of choice for most transactions in the economy, Bloomberg News reported. The extensive use of US dollars doesn’t concern authorities, who instead see it as a way to access foreign currency, according to Mthuli Ncube, the southern African nation’s finance minister. The country is ineligible to access lines of credit from multilateral financial institutions because it owes more $14 billion.

Zambia's official creditors, which include China, are getting closer to signing a memorandum of understanding on debt relief to the country in May, in what would be a key step needed to pave the way for more IMF funding, sources told Reuters. Zambia has been in default since 2020 when it became one of the first major sovereign casualties of the COVID-19 pandemic era, though progress in overhauling its debt burden has been slow. Zambia's external debt amounted to $18.6 billion by end-2022, according to government data, with China being its biggest bilateral creditor.

Ghana expects the International Monetary Fund's board to approve a $3 billion loan by the end of the second quarter of 2023, Finance Minister Ken Ofori-Atta said in a presentation on Thursday, Reuters reported. The embattled West African country secured a staff-level agreement with the IMF for the $3 billion support package in December. But the Fund requires bilateral lenders to provide assurances they will restructure its debt as a condition of signing off on the loan.