Africa

PBC Ltd., Ghana’s biggest cocoa buyer, seeks to raise $100 million from international banks to help pay off cedi debt that matured late December, Bloomberg News reported. The transaction, handled by an Accra-based advisory firm, should be completed before the start of the main harvest on Oct. 1, said Deputy Chief Executive Officer Kojo Safo. The company has approached the state-run pension fund and the government, who together own a 75 percent stake in PBC, to provide guarantees for the loans that are likely to have maturities of five to six years, he said.

Zambia, which the International Monetary Fund has warned is at high risk of debt distress, contracted an additional $2.6 billion of new external loans last year, according to the Finance Ministry, Bloomberg News reported. If the funds are disbursed, they’ll increase the southern African nation’s external debt to $12.7 billion, from $10.1 billion at the end of 2018. The new loans suggest the government is too complacent about rapidly increasing debt risks, Gregory Smith, fixed-income analyst at Renaissance Capital in London, said by email.

Steinhoff International Holdings NV is living on the edge. The global retailer at the center of South Africa’s biggest corporate scandal cut the value of its assets by 15.3 billion euros ($17 billion) because of accounting irregularities, Bloomberg News reported. The company also warned it won’t be able to keep going longer than 12 months unless its debt is reorganized and it skirts mounting lawsuits and possible regulatory fines. At risk is a business with 120,000 employees across chains including Mattress Firm in the U.S., Conforama in France, Poundland in the U.K.

Mozambique reached an agreement in principle with Russia’s VTB Bank PJSC on the restructuring of a loan that forms part of the nation’s $2 billion hidden-debt scandal, according to the International Monetary Fund, Bloomberg News reported. The southeast African nation has sought to restructure the loans since 2016, when the government admitted to the IMF it had contracted the bulk of them in secret, breaching an obligation to notify the Washington-based lender of any new credits. The U.S. Department of Justice and the Mozambican authorities are investigating the loans.

Credit Suisse Group AG’s recent shareholder meeting took an awkward turn when a Mozambican activist questioned Chairman Urs Rohner over the bank’s role in fraudulent deals that saddled her country with $2 billion of debt, The Wall Street Journal reported. The confrontation halfway through Friday’s meeting was the latest example of the rising international pressure on Credit Suisse to forgive loans it made to Mozambican state-owned companies engaged in an alleged complex fraud, and potentially, to pay damages to victims.

Top cocoa producer Ivory Coast has averted defaults on export contracts this season by letting multinational commodities companies buy at-risk contracts from local exporters, exporters and sources at the cocoa regulator said on Tuesday, Reuters reported. During the 2017/18 and 2016/17 growing seasons, exporters defaulted on nearly 500,00 tonnes of cocoa contracts they had bought in advance of the season as world market prices fell and exporters were unable to honour commitments to suppliers.

The collapse of the oil price that began in 2014 was bad news for Nigerian banks, The Economist reported. A quarter of their lending was to oil and gas firms. Many businesses were left reeling after a currency crisis. The economy stuttered, then plunged into recession. Before the oil slump just 3% of loans were not being paid back. By 2017 some 15% had gone sour. The oil shock underscored an old truth: in choppy waters, it helps to be a big ship. The country’s large banks made tidy profits and now sit on sufficient capital.

South Africa’s government has had to bring forward the bailout of state power firm Eskom, after it rushed 5 billion rand ($355 million) to the struggling utility earlier this month to avert a default and said more cash could be needed soon, Reuters reported. Eskom supplies more than 90 percent of electricity in Africa’s most advanced economy but is grappling with cashflow problems and a debt mountain which it is struggling to service.

Privinvest Group began arbitration proceedings against three state-owned Mozambican companies to seek compensation for losses the shipbuilder says it incurred after contractual breaches, Bloomberg News reported. The legal action marks a step change in Privinvest’s response to charges against employees including salesman Jean Boustani by the U.S. Department of Justice. The DOJ alleges Boustani and others stole about $200 million in Mozambique-loan proceeds in an indictment that stems from Mozambique’s $2 billion hidden-debt scandal.

In the hazy world of distressed debt trading, the fall of Sudan’s autocratic ruler of 30 years, Omar al-Bashir, has sparked fresh interest among traders and holders of the country’s long-defaulted debt, Reuters reported. Following weeks of demonstrations kindled by soaring food costs, high unemployment and increasing repression, 75-year-old Bashir was overthrown on Thursday by the military, three decades after himself seizing power in a coup. The newly ruling military council on Friday promised a transition to an elected civilian government.