Africa

The African Development Bank is poised to expand lending across Africa in response to the sharp decline in earnings faced by many states and the rise in the cost of borrowing on international markets, the bank’s president says. Africa’s main commodity exporters have been hit hard by the slump in demand for natural resources from China and the drop in the price of oil and other minerals, with many countries struggling to plug growing budget deficits, the Financial Times reported.

Angola’s central bank has pledged to tighten financial regulation and step up anti-money laundering measures after two international banks halted US dollar supplies to the southern African nation. Bank of America and Standard Chartered decided to stop supplying greenbacks to Angolan banks late last year, apparently over concerns about lax regulation. The oil-dependent nation was one of Africa’s fastest growing economies over the last decade, but it is now grappling with the collapse in crude prices, which has led to a shortage of dollars in the economy.

Nigeria has asked the World Bank and African Development Bank for $3.5bn in emergency loans to fill a growing gap in its budget in the latest sign of the economic damage being wrought on oil-rich nations by tumbling crude prices, the Financial Times reported. The request from the eight-month-old government of President Muhammadu Buhari is intended to help fund a $15bn state deficit, which has been deepened by a hefty increase in public spending as the west African country attempts to stimulate a slowing economy.

Years of rapid economic growth across sub-Saharan Africa fueled hopes of a prosperous new era, the International New York Times reported. To many, the world’s poorest continent was finally emerging, with economies that were no longer dependent on the fickle global demand for Africa’s raw resources. But as China’s economy slows and its once seemingly insatiable hunger for Africa’s commodities wanes, many African economies are tumbling, quickly.

Anglo American plc has announced to sell high-quality Brazil-based niobium and phosphate mine for $1 billion. The company is taking steps to reorganize its portfolio before year-end financial results announcement, Business Finance News reported. According to the news released by The Sunday Times, the company is intended to sell its operations in the current week. This step will be a part of its restructuring program through, which the company has opted to repair its balance sheet and reduce the debt. During 2015, Anglo American faced severe crisis, mainly due to China’s economic disturbance.

Economists have for months been criticising foreign exchange controls introduced to defend Nigeria’s currency against speculative attack. Now the restrictions are biting the country’s international jet set, who are, to their embarrassment and frustration, finding their debit cards rejected at ATMs, restaurants and shops from London to Dubai and from Paris to New York, the Financial Times reported.

Nigeria has asked the World Bank and African Development Bank for $3.5bn in emergency loans to fill a growing gap in its budget in the latest sign of the economic damage being wrought on oil-rich nations by tumbling crude prices, the Financial Times reported. The request from the eight-month-old government of President Muhammadu Buhari is intended to help fund a $15bn state deficit, which has been deepened by a hefty increase in public spending as the west African country attempts to stimulate a slowing economy.

Pravin Gordhan, South Africa’s third finance minister in less than a week, insisted on Monday that the government was committed to fiscal discipline as he sought to reassure investors following days of extraordinary turmoil that wiped billions of dollars from the value of the nation’s equity and bond markets, the Financial Times reported.

Mineral-rich Zambia has announced a program of austerity measures to try to close a gaping budget deficit and restore confidence in southern Africa’s third-largest economy amid a global commodity bust and crippling power blackouts, The Wall Street Journal reported. The proposed measures, which include scrapping subsidies on gasoline and diesel, will save the state $300 million, the Zambian presidency said Friday.

Rock stars helped convince the international community to write off more than $100 billion of African government borrowings a decade ago. Now the big debts are back, and it’s getting tougher for countries to pay them off, The Wall Street Journal reported. Mozambique was one of the biggest beneficiaries of debt forgiveness, with its debt slashed from 86% of gross domestic product in 2005 to 9% the next year. The country has built it back up since then to 61% of GDP. Ghana’s debt was 82% of GDP in 2005 just before the international community forgave about half of it.