Africa

In Cameroon, thousands of truckers spend weeks stranded at highways and border crossings due to lack of diesel. In Kenya, drivers are lining up overnight to fill their tanks. In Nigeria, airlines have threatened to ground all domestic flights as they scramble for expensive jet fuel, the Wall Street Journal reported. Across Africa, surging fuel prices are straining businesses from bakeries to airlines and adding pressure on consumers already burdened by spiraling food costs and the economic disruptions caused by the continuing Covid-19 pandemic.

South Africa's economy grew more than expected in the first quarter, recovering to the level it was before the COVID-19 pandemic thanks to a strong performance by sectors like manufacturing, data from the statistics agency showed, Reuters reported. The growth trajectory will offer some comfort to South African President Cyril Ramaphosa, who has been under pressure to lift the growth rate. Gross domestic product grew 1.9% in the first quarter in quarter-on-quarter seasonally adjusted terms and by 3.0% year-on-year unadjusted in the first three months of the year.

Comair Ltd., operator of IAG SA-owned British Airways trips in South Africa, grounded all flights after running out of funds and is awaiting further investment, Bloomberg News reported. The carrier, which also runs the domestic low-cost airline Kulula, halted all ticket sales with immediate effect, according to a statement late Tuesday evening. The company’s administrators “believe the funding may be secured,” Comair said.

China's lack of experience with tricky debt restructurings and slow coordination among its public lenders is holding up debt relief for Zambia, a test case for the top emerging market creditor, Reuters reported. Zambia became in 2020 the first country to default in the COVID-19 pandemic era, struggling under a debt burden worth 120% of GDP. Its external debt topped $17 billion at the end of 2021, of which a third was owed to China, according to Zambian government data.

A digital rand in South Africa could cut the high cost of cross-border payments for banks but its introduction is still a few years away, a senior central bank official said, Reuters reported. However, regulation of crypto assets is in the offing and might come into force within nine to 15 months, South African Reserve Bank (SARB) Deputy Governor Kuben Naidoo told Reuters in an interview. It costs 13% of a transaction to remit money from South Africa to another country, more than double the average of the Group of 20 (G20) leading global economies, according to a 2021 World Bank report.

A regional central bank is clamping down on Bitcoin transactions after the Central African Republic adopted the cryptocurrency as legal tender without consulting its monetary authority, Bloomberg News reported. The Bank of Central African States, which already doesn’t recognize cryptocurrencies, is now preventing all lenders from partnering with payment platforms that transact in digital currencies or from recognizing them as an asset.

An abrupt halt of Russian gas exports could see economies in emerging Europe, central Asia and north Africa slide back to pre-pandemic GDP levels, the European Bank for Reconstruction and Development (EBRD) warned on Tuesday, Reuters reported. Many countries in the EBRD's region of operation, which covers some 40 economies stretching from Mongolia to Slovenia and Tunisia, depend on Russian gas and a sudden ceasing of supplies would lower output per capita by 2.3% this year and 2% in 2023, according to the lender's latest report.

Zimbabwe’s President Emmerson Mnangagwa has imposed capital controls in an attempt to control the currency’s rapid depreciation, Bloomberg News reported. The Zimbabwean dollar has lost half of its value this year making it Africa’s worst performing currency. Banks in the country have been ordered to stop lending with immediate effect “to minimize the creation of broad money that is prone to abuse for purposes of manipulating the exchange rate,” Mnangagwa said in a televised speech.

Central African Republic has adopted bitcoin as an official currency, the presidency said on Wednesday, becoming the first country in Africa and only the second in the world to do so, Reuters reported. Despite rich reserves of gold and diamonds, Central African Republic is one of the world's poorest and least-developed countries and has been gripped by rebel violence for years. A bill governing the use of cryptocurrency was adopted unanimously by parliament last week, said a statement signed by Obed Namsio, chief of staff of President Faustin-Archange Touadera.

Kenya plans to tighten spending and step up efforts to collect more tax as it seeks to bring ballooning state debt under control, Bloomberg News reported. The budget deficit is projected to drop to 6.2% of gross domestic product in the year through June 2023, Treasury Secretary Ukur Yatani said on Thursday in his budget speech to parliament in Nairobi, the capital. That compares with an estimated deficit of 8.1% of GDP this year. He plans to finance the 862.5 billion-shilling ($7.5 billion) gap by raising 581.7 billion shillings domestically and 280.7 billion shillings offshore.