Middle East and Africa Morning Review | Oct 3, 2024 | ||||||
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Egypt | ||||||
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Egypt | Oct 03, 11:59 | ||||||
GDP growth edged up to 2.4% y/y in Q4 of FY 2023/24, bringing the total growth rate for that fiscal year to 2.4%, down from 3.8% in FY 2022/23, the ministry of planning said on Thursday (Oct 3). The economic growth during FY 2023/24 thus fell below expectations, with the IMF and the World Bank expecting a growth of around 2.7%. Falling gas production, depressed manufacturing and private activity, tighter monetary policy and limits on public capital spending have all dragged on economic growth during that FY. Further, FX shortages and FX rate uncertainty coupled with soaring consumer inflation dragged on the private non-oil economy and consumer demand during the first half of the year. The major currency reform from early March addressed the FX rate issues and boosted FX liquidity in the economy, but then Suez Canal revenues plummeted on the back of growing insecurity in the Red Sea. On a positive note, tourism revenues were unaffected by the regional insecurity, posting a 14% growth, while telecoms, trade, and agriculture continued to support economic activity. Looking at 2024/25, most analysts expect GDP growth to recover to around 4.0% on the back of improved business and investor sentiments, easier access to FX liquidity, and robust expansion of the tourism sector. Inflation remains high but is moderating, having fallen to 26% y/y in September from a peak of 38% y/y in Sep 2023. Downside risks relate to continued disruptions in the energy and electricity sectors, growing regional insecurity, and delays in implementing structural reforms under a key IMF programme. | ||||||
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Egypt | Oct 03, 11:20 | ||||||
The government is taking steps for the re-admission of Egypt to the JP Morgan's local currency bond index, according to news reports. Egypt was expelled from the index on Jan 31 because of FX shortages and FX rate uncertainty. After months of delays, however, Egypt - backed by massive USD 35bn UAE investment deal - implemented a major currency reform in early March, which eliminated the black FX market and boosted the FX liquidity in the economy. However, the country cannot be re-admitted for the 12 months after its expulsion, which suggests JP Morgan could potentially put it on its watchlist in early 2025 for a possible readmission in late 2025 or 2026. Egypt's local currency bonds had a weight of 0.6% in the JP Morgan index and analysts had estimated the country's inclusion led to a capital inflow of about USD 2bn. | ||||||
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Egypt | Oct 03, 06:20 | ||||||
National Dialogue holds emergency session for supporting Egypt position amid regional escalations (Ahram) Google to transition payments in Egypt to EGP starting May 2025 (Ahram) Egypt to invest EUR 40mn in Robeiki City expansion (Ahram) Egypt's real GDP grows 2.4% by end of 3Q of FY23/24 despite global challenges: CBE (Ahram) Egypt achieves 4.3% average real GDP growth over past 4 years: PM Madbouly (Ahram) Petroleum Discusses with BP Accelerating Exploration Work in Egypt (Sada Elbalad) Egypt's External Debt Decreased by USD 15bn in 6 Months, Says PM (Sada Elbalad) Indian Investments to Surge to USD 5bn in Egypt by 2025 (Egypt Today) Egypt's Metallurgical Industries Holding sets revenue, growth targets for FY 2024/25 (Egypt Today) Egypt to reduce inflation rates to 10% by end of 2025 (Egypt Today) Egypt's GASC strikes deal on direct monthly wheat supplies (Egypt Business) | ||||||
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Egypt | Oct 03, 05:41 | ||||||
The business conditions in Egypt's non-oil private sector returned to a decline in September, as the seasonally adjusted PMI fell to 48.8 in the month from 50.4 in August, according to S&P Global PMI report. We remind the August reading was the first positive printing since late 2020. The drop in September was mostly due to surging input costs - reflecting the fuel and energy price adjustments as well as the pound's depreciation from August - which led to a solid increase in output prices, albeit easing from the jump recorded in August. These price pressures dragged on customer demand and weighed down on the outlook. Consequently, output and new orders slumped, both at the sharpest rates recorded since April. On a positive note, employment numbers increased for the third month running, although the overall expansion was marginal and centred on the construction and wholesale & retail sectors. Purchasing activity also grew in September, with businesses reportedly aiming to build stocks in the hope that demand will recover. Inputs were however partly held up by a lengthening of delivery times. Business confidence in the 12-month activity outlook remained positive in September, although the degree of optimism softened from August's record high and was the lowest in three months. Further, there are still potential risks due to the challenging global economic outlook, higher interest rates, and elevated, albeit slowing, consumer inflation. We remind Egypt has secured USD 57bn external financing over 2024-27, which has already shored up confidence and is expected to unlock foreign direct investments in the economy. | ||||||
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United Arab Emirates | ||||||
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United Arab Emirates | Oct 03, 10:12 | ||||||
The seasonally adjusted S&P Global UAE Purchasing Managers' Index (PMI) dipped to 53.8 in September from 54.2 in August. The index was at its second-lowest in three years, beating only July's reading of 53.7. The neutral mark is 50.0. The slowdown in growth was accompanied by a weaker upturn in new orders and softer job creation. With new order growth softening, businesses reported fewer hires in September, driving the mildest rise in total employment since the end of 2022. September data also showed continued operational constraints, with companies often unable to sufficiently boost their capacity in order to make progress on work pipelines. A recent pivot towards selling price hikes persisted in September, as businesses raised charges at the fastest pace since January 2018. The uplift followed another sharp increase in costs, with shipping, petrol, technology and maintenance costs often reported as sources of inflationary pressures. Despite indicating robust gains, rates of growth in activity and new business across the non-oil economy receded. Business activity rose at the slowest pace since September 2021, despite widespread reports from survey members that rising demand had boosted output. Similarly, new business levels received by non-oil firms rose at a sharp pace during September, helped by a solid increase in export sales and reports of strong local market conditions. However, the rate of expansion decelerated and was the second-weakest in a year-and-a-half. | ||||||
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United Arab Emirates | Oct 03, 09:32 | ||||||
The Dubai Purchasing Managers' Index (PMI) fell to 54.1 in September from 54.2 in August, according to S&P Global. The Dubai PMI signalled a robust expansion in business conditions across the non-oil private sector in September. Overall activity levels rose at the fastest pace in four months, despite a slower upturn in new business volumes. The expansion led non-oil businesses to increase staffing and inventories to greater degrees than in August. Supplier performance also improved, though to a lesser extent amid reports of customs delays. Meanwhile, there was a sharp rise in overall input costs during September, albeit with the rate of inflation easing to a five-month low. Output prices also increased, as companies attempted to pass-through costs to customers. Notably, the latest rise in charges was the quickest since the start of 2018. | ||||||
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Nigeria | ||||||
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Nigeria | Oct 03, 09:30 | ||||||
State governors are lobbying against the enforcement of the Supreme Court's ruling on local government autonomy, just days before the report on its implementation is due. The 10-member inter-ministerial committee will submit its findings by October 13. The July 11 ruling confirmed the financial autonomy of local governments, requiring that their allocations be paid directly to their accounts. Historically, governors have resisted regulations aimed at centralizing financial control, such as the 2019 ban on transactions from state and local government joint accounts by the Nigerian Financial Intelligence Unit. Governors oppose local government autonomy mainly due to the potential loss of financial control over allocated funds. Currently, they manage these funds through joint accounts which allows them to exert significant influence over local governments. The Supreme Court's ruling would curb this power, requiring direct allocation of funds to local government accounts. Additionally, governors often appoint caretaker committees and dissolve elected councils, which would become more difficult without control over local government finances. They are also concerned that implementing this autonomy could diminish their political power and influence at the grassroots level. Civil society groups like the National Union of Local Government Employees (NULGE) are urging the federal government to enforce the ruling promptly. They argue that further delays would undermine the rule of law and hinder local governments' effectiveness in grassroots governance. Plans are already underway to distribute October's allocation directly to local government accounts, despite opposition from state officials. | ||||||
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Nigeria | Oct 03, 07:28 | ||||||
Oil marketers have reported that the Nigerian National Petroleum Company Limited (NNPC) has shut down its purchasing portal, preventing dealers from ordering petrol. As a result, marketers are still waiting for over 90 million litres of petrol, valued at around NGN 79bn, from the state-owned company. NNPC spokesperson Olufemi Soneye confirmed the shutdown, attributing it to a significant backlog that the company needed to address. He said the closure was necessary to avoid holding marketers' funds for too long, assuring that the portal would be reopened once the backlog had been reduced. Meanwhile, independent marketers expressed frustration over the delay, with more than 2,000 tickets for petrol still pending. National publicity secretary of the Independent Petroleum Marketers Association of Nigeria, Chinedu Ukadike, confirmed that marketers are awaiting the portal's reopening, noting the substantial financial impact of the delay. With the portal still inaccessible, many marketers have turned to private depot owners where they are forced to buy petrol at a premium, leading to higher prices at their stations compared to NNPC outlets. Marketers have expressed interest in purchasing directly from the Dangote refinery. | ||||||
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Nigeria | Oct 03, 06:46 | ||||||
The Federal Government has introduced new tax reliefs for deep offshore oil and gas production to encourage investment in the sector. Under the Value Added Tax Modification Order 2024, the ministry announced that key energy products and infrastructure, including diesel, feed gas, liquefied petroleum gas (LPG), compressed natural gas (CNG), electric vehicles, liquefied natural gas (LNG) infrastructure, and clean cooking equipment, will no longer be subject to value-added tax (VAT). This was revealed by the finance minister Wale Edun on the ministry's official Twitter handle. The ministry highlighted that these initiatives are a response to the rising cost of energy products, driven by currency weakness and inflationary pressures. The VAT exemptions aim to alleviate these costs. While offshore oil and gas projects remain attractive due to lower risks and higher reserves, Nigeria's sector has faced challenges in attracting investment over the past decade, partly due to inconsistent government policies and regulatory uncertainty. International oil companies (IOCs) like Shell and ExxonMobil have shifted focus to offshore fields, where Nigeria holds an estimated 200 trillion cubic feet of gas reserves. The finance ministry further announced the Notice of Tax Incentives for Deep Offshore Oil & Gas Production. This includes tax exemptions and deductions for companies involved in deep offshore exploration and production. The initiative seeks to reverse the trend of declining investments in the oil and gas sector, making Nigeria's deep offshore basin more attractive to IOCs by lowering operational costs and enhancing profitability in these projects. | ||||||
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Nigeria | Oct 03, 06:28 | ||||||
NNPC portal shutdown delays petrol supply - Marketers (Punch) FG stops VAT on diesel, cooking gas (Punch) ICPC recovered N13bn looted funds in Sept - Chair (Punch) PenCom okays ARM Access Pensions merger (Punch) W'Bank partners ministry on maritime sector development (Punch) Court hears Barbican, FBN N5.4bn shares dispute Oct 21 (Punch) Lagos gets €120m support to covert waste to electricity (Punch) Tinubu approves framework, deployment of electric vehicles in N'East states (Punch) Engage Military Contractors To Wipe Out Boko Haram, Ndume Tells Tinubu (ThisDay) FG Unveils New Fiscal Incentives To Boost Oil, Gas Sector (ThisDay) Emirates Pushes For Codeshare Agreement With Nigerian Carrier On Return To Lagos Route (ThisDay) Investors Lose N187bn As Stock Market Commence October On Negative Note (ThisDay) FG introduces tax reliefs for deep offshore oil and gas projects (Nairametrics) 140 manufacturers to receive from N1 billion single-digit interest loan- BOI Managing Director (Nairametrics) Nigeria Customs: Court strikes out suit challenging legality of $3.2 billion E-Customs project (Nairametrics) | ||||||
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Nigeria | Oct 03, 05:54 | ||||||
The federal government has introduced new tax regulations aimed at easing the tax burden on the manufacturing sector and small businesses. These changes are outlined in the "Deduction of Tax at Source (Withholding) Regulations 2024," signed by finance minister Wale Edun on Wednesday (October 2). The regulations seek to simplify tax deductions at source, particularly in transactions governed by the Capital Gains Tax Act, Companies Income Tax Act, Petroleum Profits Tax Act and the Personal Income Tax Act. A significant change is the introduction of exemptions for small businesses, particularly those with a turnover of less than NGN 2mn per month and possessing a valid tax identification number (TIN). These businesses will not be required to deduct taxes at source, offering them some financial relief. Further provisions include exemptions for specific transactions such as goods manufactured by the supplier, telephone charges and compensating payments under registered securities lending transactions, ensuring that tax policies do not stifle essential business activities. Failure to comply with the regulations, such as not remitting deducted taxes, will result in penalties under the Federal Inland Revenue Service (Establishment) Act and the Personal Income Tax Act. The regulations will take effect on January 1 2025, although early application from July 1 2024 is possible in some cases. | ||||||
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Israel | ||||||
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Israel | Oct 02, 16:16 | ||||||
The Israel Defence Forces (IDF) said on Wednesday afternoon that last night's missile attack by Iran has damaged administrative buildings used by the army but no aircraft was damaged. The damages were not significant, the army also said, so its capabilities were not injured and thus it would continue hitting targets in Gaza and Lebanon. The IDF also said that the damages were not enough to prevent a retaliation against Iran but noted that this would happen at a time considered appropriate by the government. Recall that Iran launched some 180 ballistic missiles against Israel last evening but most of them were either intercepted or missed their targets. Yet, some managed to hit infrastructure and besides the army bases, a school was destroyed and houses were also hit. The army also confirmed that no soldiers or civilians were killed during the attack even if the Iranian missiles targeted also populated areas. The IDF said that some 25,000 rockets had been fired at the country since the start of the war a year ago. | ||||||
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Jordan | ||||||
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Jordan | Oct 03, 07:52 | ||||||
Jordan's central bank sold 77-day T-bills worth JOD 200mn during an auction that was held on Oct 2, according to a statement by the institution. The auction was oversubscribed, signaling high demand and strong investor interest. Therefore, the total amount of bids submitted for the 77-day T-bills reached JOD 295mn, of which JOD 200mn were retained. The weighted average yield on the accepted bids printed at 6.502%. We remind that the country's central bank has cut its main interest rate by 50bps earlier this week in line with similar moves by the US Federal Reserve due to the peg of the local currency to the US dollar. Moreover, Jordan's CPI inflation has remained unchanged at 1.9% y/y in August. | ||||||
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Kuwait | ||||||
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Kuwait | Oct 03, 08:26 | ||||||
The S&P Global Kuwait Purchasing Managers' Index (PMI) increased to 50.3 in September from 49.7 in August. Competitive pressures remained a key feature of the Kuwaiti non-oil private sector in September and acted to limit rates of expansion in new orders and output, the latter of which increased at the softest pace in 20 months. Competition for new business meant that companies increased their selling prices only marginally despite a marked rise in input costs. Meanwhile, employment returned to growth and business confidence rose. There was also a slight increase in output in September, with the rate of expansion softening to the weakest in the current 20-month sequence of growth. Competitive pressures limited the pace of increase, while those companies that were able to offer discounts to customers saw their activity rise. Price discounting and marketing efforts led to a further expansion of new orders, the 20th in as many months. New export orders continued to rise solidly, but the rate of growth eased to a one-year low. Looking forward, September saw an improvement in business confidence, with 31% of respondents predicting a rise in business activity over the coming year. Marketing plans and ongoing competitive pricing were the main factors supporting optimism. The Kuwait PMI indices are compiled from survey responses from a panel of around 350 private sector companies. The panel covers the manufacturing, construction, wholesale, retail, and services sectors. The headline S&P Global Kuwait PMI is a composite single- figure indicator of non-oil private sector performance. It is derived from indicators for new orders, output, employment, suppliers' delivery times and stocks of purchases. | ||||||
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Kuwait | Oct 02, 14:20 | ||||||
Inflation slowed to 2.9% y/y in August from 3.0% y/y in July, according to the statistics agency. The deceleration happened despite the fact that food inflation, the second largest in the index, accelerated to 6.0% y/y from 5.9% y/y. The acceleration is surprising because the UN FAO Food Price Index was down 1% y/y in August. Food inflation in Kuwait has been mostly above 3% y/y since July 2020 and we expect that to continue during the coming months and into 2025. Meanwhile, inflation in the housing category, the largest in the index, remained at 0.9% y/y in August for the third consecutive month. Housing inflation during those three months was at the lowest level since November 2021. The last time inflation in the category was above 2% y/y was in February and we expect inflation to remain low in the coming several months. Similarly, inflation in the household equipment category, the third largest in the index, decreased to 3.7% y/y from 3.8% y/y in July.
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Lebanon | ||||||
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Lebanon | Oct 03, 13:27 | ||||||
Lebanon's Purchasing Managers' Index (PMI) decreased to 47.0 index points in September, down from 47.9 points in the previous month, according to the S&P Global PMI report published on Sep 5. The index remains firmly in the contraction territory amid the escalating Hezbollah-Israel tensions following the start of the Israeli ground incursion into the country, while the political deadlock with no end in sight and the persisting economic crisis also cause additional pressures. Furthermore, the data signals the fastest deterioration of the private sector's business conditions since December 2021. Both output and new orders declined sharply due to growing security concerns at the end of Q3 of 2024. New orders decreased at their fastest pace since January 2022 as the intensifying armed confrontations between Hezbollah and Israel have affected negatively the level of incoming new work received by private sector companies. Meanwhile, the output prices registered an increase for a fourth straight month mostly due to greater purchasing costs. Looking forward, business confidence worsened further with residents expecting contraction in economic activity over the next 12 months. The sentiments reflected expectations that regional tensions would further escalate, while economic challenges and political instability will persist. We remind that Lebanon has had a caretaker government since May 2022 and has been without a president since October 2022 due to deepening political divisions between rival blocs. The parliament has failed numerous times to elect a new president and there is no end in sight for political deadlock. Moreover, the political class has been unable to enact most of the IMF-required economic reforms, which would unlock a USD 3bn bailout programme. Lebanon and the IMF reached a staff-level agreement on a 46-month USD 3bn Extended Fund Facility in April 2022, but the deal will be approved only after the parliament enacts the needed reforms. | ||||||
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Lebanon | Oct 03, 07:58 | ||||||
The clashes between Israeli troops and Iran-backed Hezbollah on Lebanese territory continue intensifying after Israel launched a ground incursion. Both sides engaged in clashes in various Lebanese villages, which are located near Lebanon's southern border. The armed confrontations led to the killings of at least 8 Israeli soldiers and the wounding of nearly 40 others, while Hezbollah forced the Israeli troops to retreat, according to a statement by the militant group. Hezbollah also said that its fighters have destroyed three Israeli tanks on their way towards the Lebanese village of Maroun al-Ras near the southern border. Meanwhile, Israel's army called for the evacuation of additional villages in Lebanon's south, indicating that its ground operations inside the country are set to continue. | ||||||
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MENA | ||||||
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MENA | Oct 03, 10:53 | ||||||
The six countries of the Gulf Cooperation Council (GCC) affirmed their support for Lebanon and called for an immediate ceasefire in the Gaza Strip, according to news reports. The six countries held a meeting to discuss the latest regional developments. The GCC also condemned the escalation of conflict in Lebanon and the occupied Palestinian territories, calling on all involved parties to exercise self-restraint and refrain from violence. Similarly, Emir Sheikh Tamim bin Hamad Al Thani said that Qatar warned against what it called the recent escalation in Lebanon. The Emir also said the killing and injury of thousands of people puts the entire region on the verge of the abyss. The Qatari emir's remarks came at a press conference held on Oct 2 with Iranian President Massoud Pezeshkian, as part of the latter's visit to Qatar to discuss bilateral relations and the recent regional developments. The emir urged the international community to act to oblige the Israeli occupation authorities to stop its unjust aggression on the Gaza Strip and Lebanon. The mediation is a strategic option for Qatar, he said. Pezeshkian said that Iran would respond with greater strength if Israel takes any reaction to his country's recent missile attack. | ||||||
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Morocco | ||||||
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Morocco | Oct 03, 05:23 | ||||||
The industrial activity saw overall improvement in August compared to the previous month, according to the monthly survey by Bank Al-Maghrib. Production increased across most sectors, except for textiles and leather and electrical and electronics, where production fell. The capacity utilization rate rose to 77% from 76% in July. Sales and orders grew across all sectors except for textiles and leather. Order books were generally normal, with above-normal levels in chemicals and electronics but below normal in agri-food, textiles, and mechanics. For the next three months, most manufacturers expect increased production and sales, though uncertainties remain for some businesses. Some 36% of the respondents said output will increase in the next three months against 29% expecting stagnation. Only 9% expect their output to decline, however the share of respondents who are uncertain what will happen is quite substantial. Regarding sales, some 50% of the firms expect stagnation, 24% expect an increase and only 4% expect a decline. As recalled, GDP growth eased to 2.4% y/y in Q2, down from 2.5% y/y in both the previous quarter and in the same period of 2023. The GVA in the secondary sector saw a 3.8% increase, reversing a 2.4% drop in the previous year's second quarter. Improvement was led by a 23.6% surge in the extractive industry, which fell by 9.6% a year ago and a 3.6% surge in construction and public works, which also contracted a year ago. Manufacturing GVA increased by 2.9% revising a 1.6% decrease in Q2 23. The latest survey suggests industry performance is likely to keep momentum in Q3, despite setbacks in some sectors. | ||||||
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Oman | ||||||
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Oman | Oct 03, 13:23 | ||||||
Oman's total production of crude oil and condensates during the eight months of January to August decreased 5% y/y to 243mn barrels, according to the country's statistics agency. That is equal to 994,500 barrels per day (bpd), a decrease of 6% y/y, which means that Oman is pumping oil below its maximum production capacity. We estimate that Oman's maximum oil production capacity is nearly 1.1mn bpd. Oman's total oil exports during the first eight months of 2024 were 205mn barrels, unchanged y/y. That means the country exported 85% of the oil it produced. As usual, China was the largest importer of the Omani crude oil. The country imported 195mn barrels (up 5% y/y), followed by Japan with 4mn barrels (down 46% y/y). Hence, some 95% of Oman's oil exports went to China. The average price of a barrel of Omani crude oil increased 3% y/y to USD 83 during the period of Jan - August 2024. The high price is good news for the Omani economy because hydrocarbon products account for 72% of the government's total revenue. | ||||||
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Qatar | ||||||
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Qatar | Oct 03, 11:40 | ||||||
Qatar and Iran signed six documents to expand bilateral cooperation in different fields from economy to trade and education, according to Iran's official news agency. Iranian ministers of foreign affairs, sport and youth as well as energy, and their Qatari counterparts signed the documents on Oct 2 in Doha, where an Iranian delegation headed by President Masoud Pezeshkian was on an official visit. The documents call for expanding cooperation between the two countries in fields of hygiene, trade and economy, cultural programs, as well as sport and education. We should point out that Iran has been on the United States' list of State Sponsors of Terrorism and is subject to strict sanctions. Consequently, the extent to which Qatar and Iran can cooperate economically is limited. However, the two countries have historically had cordial economic and political relations, in part because they share a natural gas field. | ||||||
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Saudi Arabia | ||||||
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Saudi Arabia | Oct 03, 07:24 | ||||||
The headline seasonally adjusted Riyad Bank Saudi Arabia Purchasing Managers' Index (PMI) rose for the second month in a row in September, to 56.3 from 54.8 in August. The new level is the highest since May and reflects strong increases in output and new orders, both rising sharply from August's levels. The non-oil companies attributed the development to strengthening domestic demand, which is a welcomed news for Saudi Arabia, which wants to reduce its dependence on the oil sector. Input stocks remained healthy, encouraging some firms to ease procurement efforts. Overall, domestic demand remains healthy, which supports higher investments, job creation, and overall economic stability. Employment numbers rose robustly for second month in a row, as the private companies face higher orders and want to reduce workloads. However, shortages of skilled workers and some reports of heatwave-related disruption did result in rising backlogs in the month, albeit at a marginal pace. Even with growing domestic demand, strong competition forced the companies to lower output prices for the third straight month even though material prices rose, and technology costs and wages drove higher expenses. In fact, the strong competition in the market is raising concerns among some companies, leading to a weakening of future activity expectations. Overall, business expectations for the next 12 months remain favourable, albeit low compared to historical standards. Improving market conditions and strong demand were mostly cited as a reason for optimism. The PMI data suggests the non-oil GDP will remain strong in Q3, despite the spill-over effects from oil production cuts that were extended until December 2025. | ||||||
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Angola | ||||||
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Angola | Oct 03, 05:00 | ||||||
Sonangol, the state oil company, aims to secure a 10% share of national oil production by 2027, Sebastião Martins, chairman of the board of directors of Sonangol, told Lusa at the sidelines of the 5th Angola Oil & Gas Conference (AOG) 2024. Sonangola targets increasing its output to 80,000 barrels of oil per day across the 35 concessions it operates. Currently, Sonangol holds a 3%-4% share of the country's daily production of 1.1mn barrels. The company is focused on maintaining and enhancing production levels, with the government improving fiscal conditions and legislation to support these efforts. Although national oil production is in decline, Sonangol plans to offset this through new projects. Sonangol recorded a consolidated net profit of AOA 930bn in 2023, up from AOA 838bn in 2022. The company's revenue reached AOA 7.9tn (USD 11.5bn) translating into consolidated EBITDA of AOA 2.5tn (USD 3.6bn). Revenues were by 27% higher y/y, while EBITDA decreased by 13% y/y. Sonangol is the most lucrative asset in the government privatisation portfolio, however the sale process is not expected to begin before 2027. | ||||||
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Angola | Oct 03, 04:47 | ||||||
The National Agency for Oil, Gas, and Biofuels (ANPG) and the oil operators plan to invest over USD 60bn in Angola's oil industry from 2024 to 2029, ANPG's Business Director Helder Lombo said ahead of the start of the Angola Oil & Gas (AOG) 2024 event. This investment is aimed at boosting exploration, research, and production, encouraging new onshore and offshore operators. Notable ongoing activities include Exxon Mobil's work in the Namibe Basin and Block 15, as well as Total Energies' drilling projects in Blocks 16 and 20. Moreover, the ANPG has identified 30 opportunities, including 11 permanent projects, six onshore and offshore blocks each, and nine marginal fields, with bidding planned for 2025, he detailed. According to him, the operators would secure funding through banks and consortia. Angola aims to maintain production above one million barrels per day through its next bidding round, the permanent offer program and the incremental production initiative, which is expected to be published soon, Lombo said. The conference aims to attract international investors, with over 2,500 delegates from 40 countries attending, highlighting Angola's potential in the hydrocarbons sector. | ||||||
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Gabon | ||||||
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Gabon | Oct 03, 10:58 | ||||||
On Monday (October 1), the U.S. Chamber of Commerce, in collaboration with Gabon's National Investment Promotion Agency (ANPI-Gabon), hosted a roundtable for U.S.-Gabon business leaders in Washington, D.C. The event was themed "Strengthening Trade and Investment Relations between the United States and Gabon", concluding with the signing of six memorandums of understanding across energy, hydrocarbons, agriculture, health and digital technology. Transitional president General Brice Clotaire Oligui Nguema gave a keynote address where he announced the official launch of Gabon's Investment Guide for America. This guide aims to provide detailed information on investment opportunities, regulatory frameworks and incentives for investors. The event featured leaders from the U.S.-Africa Business Center at the U.S. Chamber of Commerce, American business representatives and officials from the World Bank and other multilateral financial institutions. The strategic meeting focused on reinforcing economic links and collaboration between business communities, as well as encouraging mutually beneficial economic cooperation and trade relations. | ||||||
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Ghana | ||||||
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Ghana | Oct 03, 07:58 | ||||||
The main opposition party NDC issued a statement in which it says it accepts the assurances from the Electoral Commission's (EC) that it will release an updated version of the provisional voter register within a week. The NDC demanded a forensic audit of the register claiming irregularities and discrepancies, raising concerns over the credibility of the electoral process, but EC assurances later assured it would address all concerns. Consequently, the NDC decided it would abandon calls for an audit but recommended that the voter register is exhibited both online and physically at exhibition centres. It also demanded a multi-stakeholder and interparty examination of the IT system of the EC to identify its vulnerabilities. The issue with the credibility of the voter register has been one of those raised by NDC as part of the campaign ahead of the Dec 7 elections. It raised concerns over the credibility of the elections and potential tensions, but the latest developments suggest the risks have decreased. | ||||||
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Ghana | Oct 03, 07:38 | ||||||
The government will engage trade unions before their planned Oct 10, government spokesperson Palgrave Boakye-Danquah said. The strike is held in protest against illegal mining and aims to force the government to take decisive measures against it. However, Boakye-Danquah expressed confidence the industrial action could be prevented as the government is working to address the raised concerns. He added that the government acknowledged the negative impact of the galamsey (illegal mining) on every Ghanaian and felt under pressure to "deal with the menace". There has indeed been growing pressure lately to act against illegal mining, which has also been blamed for affecting cocoa and food crop production. The issue has become even more important now that there are just two months before the general elections. Unions have described the government efforts so far as "failed and corruption-infested militarized battles" and noted that illegal mining has resulted in the destruction of over 2.5mn hectares of forest cover, increased respiratory diseases in mining areas by 35%, and cost the economy about USD 2.3bn annually. It is also believed to have affected cocoa production as it crowds out farmers. In terms of measures, trade unions demand a state of emergency to be declared in areas most affected by galamsey and a review of relevant legislation (incl. LI 2404 on tracking of earth moving and mining equipment and LI 2462 on mining in forests). Boakye-Danquah assured the government was looking into the demands and would reach out soon with a response. | ||||||
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Ghana | Oct 03, 07:09 | ||||||
Organised Labour will hear from government before Oct. 10 strike - Palgrave Boakye-Danquah assures (Joy FM) 3-day protest to demand release of anti-galamsey protesters begins today (Joy FM) Don't be complacent despite positive Fitch, Global InfoAnalytics polls - Mahama to NDC (Citi Newsroom) Galamsey: We'll lose our seats if we impose a ban - Asante Akim South MP (Citi Newsroom) Expedite hearing on galamsey cases - Attorney General to judges (Daily Graphic) Mahama promises 2-day Eid-ul Fitr holiday for Muslims if elected President (Class FM) | ||||||
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Kenya | ||||||
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Kenya | Oct 03, 07:59 | ||||||
Western nations are reportedly urging Kenya to request an assessment from the International Monetary Fund regarding corruption and governance challenges, according to a Reuters report citing unnamed sources. This push is said to aim to facilitate the release of USD 600mn in IMF funding, which has been stalled since the Kenyan government withdrew Finance Bill 2024 in response to widespread protests. The demonstrations highlighted grievances about corruption and the perception that tax revenues were being misused to support the extravagant lifestyles of politicians, resulting in over 50 fatalities. | ||||||
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Kenya | Oct 03, 07:55 | ||||||
The United Democratic Alliance (UDA) has firmly rejected a bill that seeks to extend the presidential term limit from five to seven years, proposed by its own senator Samson Cherargei. UDA Secretary General Hassan Omar denounced the proposal as misguided, warning that it undermines Kenya's hard-won democratic principles. The party urged members to withdraw support for the bill, emphasizing the importance of term limits in ensuring accountable leadership. President William Ruto also distanced himself from the proposed amendment, reaffirming his commitment to upholding the Constitution. He stressed that any attempts to alter term limits for personal or political gain are detrimental to the integrity of the democratic process. Ruto urged lawmakers to defend constitutional values and resist changes that could erode Kenya's democratic foundations. President Ruto's and UDA's remarks come in response to an announcement by the Senate inviting public views on Cherargei's bill. Beyond extending the presidential term limit, it seeks to introduce a seven-year term for governors and Members of Parliament, create the office of a Prime Minister appointed by the president from among MPs, and amend the procedure for removing governors and deputy governors by limiting challenges to the Supreme Court. These developments follows a summer of youth-led protests, which placed pressure on the government over political and economic issues. Given this backdrop, President Ruto and the UDA are likely being cautious in distancing themselves from inflammatory proposals that could provoke further unrest. | ||||||
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Kenya | Oct 03, 07:38 | ||||||
The Treasury aims to use funds from the recently increased Road Maintenance Levy to address the KES 167bn debt owed to road contractors, according to local news reports citing finmin John Mbadi. Mbadi said the hike would bring KES 30bn of additional revenue annually , which will be used to clear these pending bills. Mbadi said the treasury had prepared a strategy to securitize this additional revenue and expressed confidence that the debts could be settled by December. We note back in July the authorities hiked the levy by 39% (KES 7) to KES 25 per litre of fuel despite a legal challenge against the decision, as part of measures meant to offset the revenues foregone with the withdrawal of Finance Bill 2024. At the time, the increase was said to be expected to up the RMLF collections to KES 115bn from KES 83bn. | ||||||
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Kenya | Oct 03, 07:21 | ||||||
Treasury Cabinet Secretary John Mbadi told senators that KES 200bn, or about a third of the KES 665bn in pending bills said to be owed by the national government may be fictitious, according to local news reports. Preliminary findings from a committee tasked with reviewing the claims has reportedly flagged nearly 30% of the amount as potentially fraudulent, Mbadi said. The bills, submitted by more than 100,000 contractors, are currently under verification, with a final report still pending. In addition to these claims, pending bills of county govts and entities, associated with them, stand at KES 182bn, Mbadi said, without commenting on whether all of these have been verified. Mbadi further acknowledged that the situation has negatively impacted the private sector, as delayed payments have strained liquidity, affected salaries, and forced businesses to scale down or close. The committee, formed last year, is auditing claims dating back to 2005, with govt then intending to give priority to older, verified bills. Indeed, despite govt's frequent pledges to address the problem, the amount of pending bills has remained persistently high, affecting the liquidity and the profitability of the private sector, despite govt's pledges to address the problem and various initiatives undertaken in that regard. | ||||||
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Kenya | Oct 03, 07:07 | ||||||
Finance minister John Mbadi urged CBK to reduce lending rates, encouraging more borrowing by the private sector to boost job creation and economic activity, according to a report by the local Business Daily citing Mbadi addressing MPs. Lower rates should also offer relief to households struggling with expensive credit by reducing the loan costs. The remarks came shortly after the release of the September print, which showed inflation dropped to 3.6% y/y, the lowest in 12 years, driven by lower costs for food, energy, and transport. CBK is expected to announce its next interest rate decision on 8 October, with analysts predicting a further rate cut. This would follow a 25bps cut implemented in August, bringing the benchmark rate to 12.75%. | ||||||
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Kenya | Oct 03, 06:56 | ||||||
Treasury calls for rates cut as inflation falls to 12-year low (Business Daily) Treasury rejects Sh200bn pending bills claims (Business Daily) Mining remains in recession after third straight contraction (Business Daily) How MPs are plotting to scuttle Gachagua defence (Nation) Increased fuel levy to pay road contractors' debts (Nation) Ruto's silence on woes facing his deputy escalates political fallout (The Standard) Impeachment: Gachagua left it too late to tell who his real friends are (The Standard) Ruto slams proposal to extend term limits for elective offices (The Star) State to comply with law in measures to recover Hustler Fund defaulters (Kenya Broadcasting Corporation) Clergy urges Gachagua to 'seek forgiveness' from Ruto as impeachment looms (Citizen) Hundreds of Jobs at Risk as Govt Threatens to Close 145 Factories (Kenyans.co.ke) | ||||||
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South Africa | ||||||
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South Africa | Oct 03, 08:41 | ||||||
Private sector PMI gained some traction, rising to 51 in Sep from 50.5 in August, the S&P Global survey indicated on Thursday (Oct 3). The improvement was small but still indicates an improvement in operating conditions at the end of the third quarter. Significantly, the sustained improvement in new orders generated the first expansion in business activity since Aug 2023. Total sales volumes increased for the second month running, the first sustained improvement since mid-2022. However, both activity and sales growth was underpinned by the wholesale and retail sector, while output contracted across industry, construction and services, though at a more moderate rate, the statement indicated. The softening of cost pressures was a major driver for the improvement in total sales and output volumes. The firming of the rand contributed to the slowest increase in input costs in four years. We remind that petrol prices which are measured in the CPI index fell 4.1% m/m in September and will slash CPI growth by 0.6pps in our calculations. The coke and petroleum prices in August were down 0.5% m/m but its contribution to headline PPI declined to only 0.5pps from 1.2pps in the preceding month. The appreciation of the rand was a factor cited by respondents helping to reduce import costs. This allowed firms to reduce output charges for the first time since Aug 2020. Despite the noted improvement, firms remained resistant to increasing employment in September. Similarly, firms also reduced purchasing for a fourth month in a row amid supply chain challenges from the container backlog at Durban port. Despite persisting challenges, companies retain a solid optimistic outlook above the long-term average. Hopes for higher sales, stable energy supply, lower inflation and increased government spending were said to have supported sentiments. The improvement in September whole-economy PMI is moderate and limited to some sectors of the economy but still good news for GDP growth. According to the central bank's latest projections, real GDP will expand by 0.6% q/q in each of the final two quarters of the year, which still a very subdued rate. | ||||||
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South Africa | Oct 03, 05:57 | ||||||
South Africa endorsed the candidacy of Bajabulile Swazi Tshabalala, current AfDB senior VP, as its official nomination for a president of the AfDB. Tshabalala immediately resigned from her current post, which she held since 2020, in order to prevent a conflict of interest in line with the rules of the multilateral institution. Ms Tshabalala played a vital role as number two at the AfDB alongside AfDB president Dr Akinwumi Adesina in ensuring that the Bank met and even exceeded its mandate of supporting the economic growth of the continent, finance minister Enoch Godogwana said in a statement. Tshabalala has more than 30 years of professional experience gained over a diverse range of institutions including State-owned companies, the private sector, and a range of sectors, from transportation and logistics, to infrastructure, financial services and development finance. The new term of the president will begin in September 2025. Candidates from Chad, Tanzania, Zambia and Senegal are also in the running. | ||||||
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South Africa | Oct 03, 05:44 | ||||||
Transnet CEO Michelle Phillips has told the Joburg Mining Indaba on Wednesday (Oct 2) that the 193Mt rail freight target, which was set by the second phase of the partnership between business and government, would require substantial amount of work and cooperation. We are behind, as we speak, the CEO said, so there is a lot of work to catch up. Transnet reported earlier that it moved 151.7Mt of goods through its rail network in 2023/24. Although this represents a 1.5% increase relative to the year prior, it fell short of the target set in the company's recovery plan. Transnet set a higher 170Mt target for 2024/25 but has been pressured to raise this if the logistics industry was to support higher economic growth. Transnet performance has deteriorated substantially since 2017/18 when it moved 226Mt of goods through the rail network. According to a model presented by the Bureau for Economic Research (BER) and endorsed by the partnership between business and government, immediate reforms in four areas would generate 3.3% growth in 2025. One of the areas is port and rail infrastructure investments aimed at raising capacity and efficiency. Phillips told the indaba that neither Transnet, nor the government had the balance sheet to support the required investment in port and rail infrastructure, which is why she fully supported the reforms that will facilitate private-sector participation. The CEO highlighted the vertical separation of Transnet Freight Rail (TFR) into a train operations business and an infrastructure manager, as well as the corporatisation of the Transnet National Ports Authority, which would be finalised by April. The split of the TFR by October, paving the way for private participation, was one of the conditions for the ZAR 47bn guarantee provided by the National Treasury. On Oct 1, Transnet reported the split into Transnet Infrastructure Manager (TRIM) and Transnet Freight Rail (TFR) was now official, appointing Durban Port manager Moshe Motlohi as acting TRIM CEO. This move is opposed by labour as the United National Transport Union said the decision appeared rush and premature and that consultative processes are far from complete. UNTU critised the vertical separation and the benefit of bringing private sector participation in the form of slot sales, considering that the private sector participants will have to utilise the same poorly maintained dilapidated infrastructure that is being used by Transnet. | ||||||
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South Africa | Oct 03, 05:14 | ||||||
SA still needs a year to exit greylist, says David Masondo (Business Day) PETER BRUCE: As rubber hits the road, don't get swept up in GNU-phoria (Business Day) PIC exposure to Eskom bonds now at R83bn (Business Day) GNU optimism pushes PIC assets to record R3-trillion (Business Day) Transnet set to offer more private investment in rail operations (Business Day) SA needs 'much larger exploration fund' to grow mining (Business Day) Transnet Freight Rail has officially split into two - amid a backlash from labour (News24) How Eskom justifies its mega hike: Coal costs, special discounts for large users and carbon tax (News24) Mashatile calls on UK businesses to expand footprint in SA (Eyewitness News) Simelane goes to ground after ActionSA's criminal complaint over her VBS-linked loan (Eyewitness News) Lost in transition no more, Cyril Ramaphosa's living his best life (Daily Maverick) We will stop the bleeding, Transnet CEO tells Joburg Mining Indaba (Daily Maverick) Ex-state employee gets five years for Digital Vibes corruption; key players yet to face prosecution (Daily Maverick) | ||||||
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Uganda | ||||||
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Uganda | Oct 03, 06:55 | ||||||
The Stanbic Bank Uganda PMI decreased to 54.2 index points in September from 56.3 in August, but remained in expansion territory signalling further growth in private sector activity. Output and new orders increased for a sixth consecutive month which was attributed to strong demand, successful advertising campaigns and attracting new customers. Companies responded by raising their employment and purchasing activity. Still, staff costs stagnated but the continued rise in purchase prices resulted in another input cost increase. Subsequently, businesses increased output prices after a brief cut in August. Business sentiments remained positive with majority of respondents saying they expect business activity to grow over the next 12 months. The optimism was supported by planned investment in new products and advertising. The latest PMI data suggests private sector has continued growing in Q3, following the strong performance in Q2. Economic growth reached 5.4% in H1 of FY 2023/24 (which is H2 of calendar 2023) and the central bank expects growth to pick up to 6.0% in FY 2023/24 and 6.0-6.5% in 2024/25, supported by oil and gas investment, higher external demand, and low inflationary environment. Growth is seen to exceed 7% over the longer term as the country starts producing oil, scheduled for 2026. | ||||||
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Uganda | Oct 03, 06:00 | ||||||
The US State Department said it banned four members of the Ugandan police forces and their families from entry into the US due to their involvement in "gross violations of human rights, namely torture and cruel, inhuman, or degrading treatment or punishment." The four are Bob Kagarura, former Wamala regional police commander; Alex Mwine, former Mitanya district police commander; Elly Womanya, former senior commissioner and deputy director of the police's criminal investigations division; and Hamdani Twesigye, former deputy inspector of police. The statement said that there are serious and credible reports from civil court, civil society organisations and independent journalists about the four individuals' involvement in human rights violations and the US action affirms its commitment to advancing human rights of all Ugandans. The US did not provide further details about the violations in which the four individuals were involved but opposition leader Bobi Wine commented that they had a role in the torture of MP Francis Zaake and were then shielded by the regime and promoted. Indeed, the four police officers appeared in court in 2020 accused of Zaake of torturing him following his arrest in April of that year while distributing food to communities in his constituency. He was arrested for breaching the COVID-19 lockdown rules and claimed to have been tortured while in custody for ten days. The court ruled that he was indeed tortured and should receive compensation but did not find the police officers guilty of the torture due to absence of concrete evidence of their involvement. Zaake is a member of the NUP party of Bobi Wine. | ||||||
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Zambia | ||||||
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Zambia | Oct 03, 07:44 | ||||||
The Lusaka Securities Exchange (LuSE) market capitalization closed at ZMW 166bn at end-September, marking an increase by 15% m/m and impressive 87% ytd. This rise has been fueled by significant share price gains from major companies such as Shoprite, ZCCM-IH, Copperbelt Energy Corporation (CEC), and ZAFFICO. Shoprite led the growth with a 24.8% increase, followed by ZCCM-IH at 18.5%, CEC at 12.2%, and ZAFFICO at 10.2%. However, minor declines were observed in Bata (-1.3%), Zambeef (-0.9%), and Zambia Breweries (-0.14%). The month of September saw trading volumes increase by 49% m/m to ZMW 44mn. Over 3.5mn shares changed hands across 3,299 transactions. Copperbelt Energy Corporation (CEC) dominated market turnover, accounting for over 50% of total trades. Notably, on September 9, LuSE recorded its highest daily turnover of ZMW 23mn, driven by CEC (ZMW 19mn) and Chilanga Cement (ZMW 4mn). The LuSE All Share Index (LASI) closed the month just below 16,000 points, up by 5% m/m and 48% ytd. This performance places LuSE as one of the fastest growing stock exchange in Africa for 2024, boasting a 48% gain in local currency and 43% in USD terms. Overall, foreign retail investors contributed 21% to total turnover, while local investors made up the majority at 64%, highlighting strong domestic market participation. The resilient performance of the LuSE despite global economic uncertainties showcases investor confidence and the growing strength of Zambia's capital markets. | ||||||
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Zambia | Oct 03, 07:16 | ||||||
NGOCC Criticizes 2025 budget for failing to address gender-based violence and equality initiatives (Lusaka Times) We've not adjusted PAYE because our focus is to help the unemployed - Musokotwane (News Diggers) Zesco reapplies for tariff increase, with reduction on residential consumers (News Diggers) Energy minister announces no change in 21-hour loadshedding (Daily Revelation) Continued blackouts in health centres unacceptable (Daily Revelation) IBA grants all radio and television stations a 'cooling off' window (moneyfmzambia.com) Energy minister announces 3 hours of stable power supply (moneyfmzambia.com) | ||||||
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Zambia | Oct 03, 06:58 | ||||||
President Hakainde Hichilema, alongside leaders from Angola, the Democratic Republic of Congo (DRC), and Tanzania, is set to meet U.S. President Joe Biden in Luanda, Angola, to sign the agreement for the Lobito Economic Corridor and the Zambia-Lobito Greenfield Railway. This strategic development corridor will connect the DRC and Zambia to global markets through Angola, enhancing regional trade and infrastructure. Hichilema confirmed this pivotal meeting during the launch of the USD 500mn Lumwana Super Pit Project in Solwezi. Last year, the U.S. and EU jointly endorsed the development of the Lobito Corridor. At the G7 summit in Japan in May, Biden announced an initial commitment of USD 250mn (ZMW 5bn) to develop 1,300 km of the corridor. This investment underscores a strong partnership aimed at bolstering economic ties and infrastructure in Southern Africa. The U.S. President is scheduled for a three-day visit to Angola from October 13 to 15, marking his first trip to Africa as President and the first-ever visit by a U.S. leader to Angola since its independence from Portugal in 1975. According to the U.S. Department of State, over USD 3bn has been allocated to the Lobito Corridor's development in under 18 months. This substantial investment encompasses various sectors, including transportation and logistics, agriculture, clean energy, health, and digital access. The collaborative effort signals a transformative opportunity for the region, positioning the Lobito Corridor as a key player in enhancing Africa's economic landscape. We note that recently, during the 79th session of the United Nations General Assembly in New York, Zambia's transport minister Frank Tayali and his Angolan counterpart Ricardo Daniel Sandaõ Queirõs de Abreu signed the Lobito Corridor Railway Development Concession Agreement with the Africa Finance Corporation (AFC) which marked a pivotal milestone in establishing Zambia as a transport and logistics hub. | ||||||
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Zambia | Oct 03, 06:24 | ||||||
President Hakainde Hichilema officiated the groundbreaking ceremony for the Lumwana Mine Super Pit in Kalumbila District. The expansion, led by Barrick Lumwana, will inject an estimated USD 500mn into infrastructure development, operational enhancements, and advanced mining technologies in its first phase. The total cost of project is estimated at USD 2bn although the feasibility study is yet to be completed. Barrick Gold, which operates the Lumwana mine, said that it expects the study to be completed by the end of this year and construction works to start in 2025. The Lumwana mine was established in 2009 and is one of the largest copper mines in the country, with an estimated annual production capacity of approximately 140,000 tonnes of copper. The expansion project should increase this to 240,000 tonnes over +30-year life of the mine. Zambia plans to increase its copper production to 1mn tonnes by 2027 and 3mn tonnes by 2031 and this project is a significant towards achieving those goals. | ||||||
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Zambia | Oct 03, 05:40 | ||||||
Secretary to the Treasury Felix Nkulukusa announced that President Hakainde Hichilema will step down from the Industrial Development Corporation (IDC) Board once he provides strategic policy direction. This statement follows a recent World Bank recommendation for the president's stepdown to mitigate potential conflicts of interest and political interference. In an interview, Nkulukusa emphasized that Hichilema's involvement on the board was initially to shape the IDC's strategy and operations. Nkulukusa disclosed ongoing discussions with the president to expedite this process. Moreover, Nkulukusa indicated that the government intends for both the Minister of Finance and himself to step aside, advocating for "eminent persons" to lead the IDC. Nkulukusa acknowledged that the recent World Bank recommendations stemmed from previous discussions with the government regarding fiscal challenges and served as guidance for the government to assess and implement better practices. Recently, the World Bank has called for the removal of the President from the Industrial Development Corporation (IDC) Board to prevent conflicts of interest and political interference. | ||||||
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