Africa

The World Bank and IMF have endorsed Zimbabwe’s plan to clear $2.2 billion in arrears to international creditors, the finance minister said on Wednesday, but U.S. sanctions may still prevent fresh loans to support the rebuilding of a shattered economy, Reuters reported. President Emmerson Mnangagwa has promised to revive the economy, pay foreign debts that the country has defaulted on since 1999 and end the international pariah status that Zimbabwe acquired under Robert Mugabe’s near four-decade rule.
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Debt stress in Zambia is set to escalate next year as the burden of hefty borrowings from China starts to weigh, throwing the copper-exporting African nation into a struggle to avoid default on its hard currency debt, analysts said. Opinions diverge on whether default can be evaded, partly because certain factors are subject to both market fluctuations and political uncertainties, the Financial Times reported.
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The global financial crisis left lasting scars on the world economy, including slower growth, higher government debt and even lower fertility rates, the International Monetary Fund said. A decade after Lehman Brothers filed for bankruptcy in 2008, output in more than 60 percent of the world’s economies remains below where it would have been if the crisis hadn’t occurred, the fund said in a report Wednesday. The drop was steepest in the 24 countries that experienced financial crises, the Fund said in an analytical chapter accompanying its latest World Economic Outlook, Bloomberg News reported.
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Zambian Finance Minister Margaret Mwanakatwe is no longer having sleepless nights over an International Monetary Fund loan the southern African nation has been trying unsuccessfully to secure for the past two years, Bloomberg News reported. “I’ve talked about four things that keep me awake. Four months ago I was saying IMF. I don’t say that anymore,” she told business leaders Tuesday in the capital, Lusaka, after delivering the 2019 budget last week.
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South African construction firm Group Five will cut more jobs as it seeks to trim loss-making divisions, it said on Tuesday, highlighting an industry-wide slump in its home market that has left many companies fighting for survival, Reuters reported. South African construction companies have been hit hard in recent years as stagnant economic growth has hobbled public infrastructure spending, prompting some of them to file business rescues, similar to chapter 11 bankruptcy in the United States.
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When President Trump tweeted in August that South Africa was engaged in “the large scale killing” of white farmers to seize their land, the nation’s president, Cyril Ramaphosa, didn’t respond personally. A fabricated accusation from the leader of the free world was the least of his problems, Bloomberg News reported. Ramaphosa probably felt his time was better spent doing his job.
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The African Development Bank said it’s working with Zimbabwe’s government to find a “sustainable solution” to settle its debt arrears and enable the state to start borrowing again, Bloomberg News reported. Zimbabwe owes multilateral lenders about $1.8 billion. President Emmerson Mnangagwa has said he plans to prioritize the repayment of the loans as he sets about rebuilding an economy destabilized by almost two decades of mismanagement under his predecessor Robert Mugabe. Central bank Governor John Mangudya said last week he expects the arrears to be cleared by September 2019.
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Agro-industry firms Cargill, Wilmar and Touton have made offers for the liquidated assets of Ivory Coast’s top cocoa exporter SAF-Cacao, bankers and sources at the country’s cocoa board (CCC) said on Thursday. A court ordered the liquidation of SAF-Cacoa, which purchases between 150,000 and 200,000 tonnes of cocoa beans each season, in July over debts it owed to the CCC, Reuters reported. It owes about 80 billion CFA francs ($143.50 million) to the CCC and 160 billion CFA francs to Ivorian banks.
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Banks in Ivory Coast are considering whether to offer a discount on the debt of failed giant cocoa exporter SAF-Cacao to entice buyers, three bankers involved in the negotiations told Reuters on Tuesday. A court ordered in July the liquidation of SAF-Cacao, the top exporter in the world’s leading cocoa grower, over defaults on cocoa contracts during the 2015-18 seasons, Reuters reported. Banks are ready to offer discounts to buyers if it allows them to recover part of their claims estimated to be around 160 billion CFA Francs ($289 million).
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Britain will support Zimbabwe to get on to an interim IMF staff program to help the country quickly clear its foreign arrears, Britain's ambassador in Harare said on Tuesday. Clearing the $1.8 billion in arrears to the World Bank and African Development Bank is seen as a major step for Zimbabwe to start accessing foreign credit, especially for the private sector as well as foreign direct investment, the International New York Times reported on a Reuters story.
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