Snapshot on the African Economy as @ 280521


Friday, May 28, 2021/ 03:00PM / United Capital Research / Header Image Credit: Ventures Africa


Anglophone West Africa


  •  The CBN hinted that recent dips in external reserves are traceable to its effort at clearing part of the outstanding FX backlog from 2020.
  • The Monetary Policy Committee of the Central Bank of Nigeria after their two-day meeting voted to retain the Monetary Policy Rate at 11.5%, as well as retain the asymmetric corridor of +100/-700 basis points around the MPR; retain the CRR at 27.5% and retain the Liquidity Ratio at 30.0%.
  • The Central Bank of Nigeria has officially recognised the NAFEX window rate after taking off the prior official exchange rate of N379.0/$1 from its website. At the MPC meeting, the CBN governor stated it has recognised that most transactions in the Nigerian economy are done at the I&E window rate, and thus, necessitates the need to adopt it as the official exchange rate.  
  • The CBN disclosed in its communiqué at the end of the Monetary Policy Committee meeting that Banks' credit to the economy rose to N23.5tn as of the end of Mar-21 from N22.7tn at the end of Dec-21.  
  • The Nigeria National Petroleum Company (NNPC) and its Product Sharing Contract (PSC) partners (Shell Nigeria Exploration & Production Company, Total Exploration & Production Nigeria Limited, Esso Exploration and Production Nigeria Limited, and Nigerian Agip Exploration) have executed agreements to renew Oil Mining Lease (OML) 118 for another twenty years.  
  • According to the Nigerian Electricity Regulatory Commission (NERC), revenue to the Nigerian power sector has improved since the implementation of the Service-Based Tariffs that started in November 2020. They further stated that electricity consumers at the high-end consumption chain have paid about 78.0% of their electricity bills.
  • According to the GDP report published by the NBS, the Nigerian economy expanded by 0.5% y/y (in real terms) in Q1-2021, compared to 1.9% y/y growth in Q1-2020 and 0.1% growth in Q4-2020. The sustained expansion suggests the economy is well-positioned to continue the path of growth, following the exit from recession in Q4-2020.


  • The Securities and Exchange Commission (SEC) has launched its first Capital Market Master Plan (CMMP) to guide the development of a robust capital market in the country over the next 10 years. The CMMP was developed by a working group drawn from key stakeholders in the financial sector and is expected to make the capital market attractive to raise enough patient capital to finance long-term growth.
  • The Bank of Ghana (BoG) has set in motion a directive called the Corporate Governance Directive (CGD) that seeks to overhaul the governance structure of Rural and Community Banks (RCBs). The directive is expected to take effect from Mar-22.
  • Noteworthy to mention, the document contains a mix of already existing regulations as well new regulations. For example, the directive looks to enforce the previously "advised" tenure limit of twelve years and nine years for the CEOs and Directors of RCBs.  
  • MTN Ghana declared a profit after tax of GH¢1.4bn for the 2020 financial year. Subsequently, the telecoms company announced a dividend payment of 8Gp per share after approving a dividend payment of GH¢614.5m. This represents 70.5% of its profit for the year in review.


  • A four-member investment and technical team of Ghana's independent power producer, Sunon Asogli, led by its co-Founder and Director, is in Liberia to negotiate a deal in the power generation sector. The deal is expected to take a three-pronged offering.
  • First, the company aims to acquire an interest in the existing 88.0MW Mt. Coffee Hydro Power Plant in Liberia. In addition, it seeks to expand the existing capacity of the hydropower plant by between 60MW - 80MW in the medium term.  Lastly, the final part of the transaction is a long-term plan to build a new hydropower plant on the St. Paul River to add to existing power generation capacity. 

Francophone West Africa


In the past week, a former coup leader took over Mali again after firing the president and prime minister of the transitional government and announced a cabinet reshuffle. The duo was released on Wednesday in the presence of international arbitrators.

Ivory Coast

 In a bid to reduce the dominance of foreign players in its cocoa industry and to encourage the growth of the local industry, the Ivory Coast government, the world's top cocoa producer, will ensure domestic shippers handle a fifth of all international cocoa contracts. The move seeks to reduce the dominance of foreign players.


Inflation in Senegal hit a two-year low in April, printing at 0.3% y/y. Lower domestically produced food prices drove the drop in inflation.

East Africa


  • The Monetary Policy Committee in Kenya chose to leave its benchmark interest rate unchanged at 7.0% in line with market expectations.
  • According to the Central Bank of Kenya's (CBK) governor, Patrick Njoroge, private sector credit grew by 6.8% in the twelve months to Apr-21, compared to 9.7% in the twelve months to Feb-21, well below the central bank's target rate of 12% - 15%, deemed adequate to support economic development. The slowdown between March and April reflects the impact of lockdown and other Covid-19 restrictive measures on banks' willingness to extend credit.
  • According to the latest petroleum products price review, the price per litre of super petrol in Nairobi climbed to Sh126.37 ($1.18) while that of diesel and kerosene remained unchanged at Sh107.66 ($1) and Sh97.85 ($0.91), respectively.
  • As a result, the parliament wants the National Treasury to urgently put into operation the Petroleum Consolidated Fund to help stabilise petroleum products pump prices.


  • Ethiopia ended its state monopoly in the telecom sector with a new license awarded to Global Partnership for Ethiopia.
  • Following the violence /ethnic clashes ongoing in the Tigray region of Ethiopia, the United States has imposed wide-ranging economic sanctions on the country. In addition, visas of government and military officials (including neighbouring Eritrea) will be restricted.
  • The National Election Board of Ethiopia announced that general elections will take place on June 21 but listed 40 constituencies in six regions where the polls will not proceed due to insecurity, irregularities, and legal challenges


Uganda’s fiscal deficit for Apr-21 exceeded its budget by 57.8% as total revenues failed to meet their target, while government expenditures overshot its budget.


Foreign exchange reserves in Tanzania moderated by 2.6% m/m and 6.8% y/y to $5.0bn at the end of Mar-21, from $5.2bn at the end Feb-21. This translates into an export cover of 5.9 months, which is slightly below the Southern African Development s (SADC) benchmark of six months.


  • SPENN, a financial technology company with a cost-free mobile banking application powered by I&M Bank, has signed a partnership deal with Espoir Basketball Club valued at Rwf15.0m to promote digital payments. The one-year agreement will be implemented in the 2020/21 season with a possibility to extend the partnership in the future.
  • In a one-day visit to Rwanda, French president, Emmanuel Macron sought the forgiveness of survivors of the 1994 genocide against the Tutsi in a speech delivered at the Kigali Genocide Memorial, where over 250,000 victims of the genocide were laid to rest.

Southern Africa

South Africa

  • In the last week, the South Africa Reserve bank decided to hold its repo rates at 3.5%.  
  • Figures from Statistics South Africa showed that South s producer price inflation rose to the highest level since Nov-18. The Producer Price Index (PPI) rose by 6.7% y/y in Apr-21, following a 5.2% y/y increase in Mar-21. On a monthly basis, PPI rose by 7bps in Apr-2021. Cost pressures are expected to remain elevated in 2021 as electricity prices will rise by double digits in Jul-21.
  • Major South African retailer, Mr. Price reported a PAT of R2.7m, representing a 2.2% y/y growth, from the previous year, an impressive return considering the pandemic in 2020.
  • Mr. Price stocks soared as much as 12.0%, yesterday during intra-day trading in response to the news.
  • According to the Public Enterprise Minister, troubled South Africa utilities company, Eskom Holdings SOC Ltd., cut its debt by R83.0bn in 2020/21, to R401.0bn. Furthermore, three different units under Eskom would begin to operate separately in Jul-21.


s inflation rate rose by 5bps to print at 23.2% in May-21, from 22.7% in Apr-21. Inflation rate currently stands at an 18-year high.  

Food inflation remained the primary driver of inflationary pressures as food inflation increased to 28.5% in May-21, from 27.2% in Apr-21.

In a bid to lure customers away from the parallel market, the Zambian central bank has increased the amount of foreign exchange customers can book from bureau de changeto $5,000 from $1,000 previously.


  • Zimbabwean President Emmerson Mnangagwa published penalties for companies and individuals to prevent what the government describes as profiteering from selling hard currency it makes available at auctions.
  • The Reserve Bank of Zimbabwe will issue fines to companies and individuals if foreign currency obtained directly or indirectly from the weekly auction or from banks is used for purposes other than that specified in the application.
  • The Development Bank of Southern Africa has agreed to restructure a $206.0m loan that the Zimbabwe National Road Administration secured in 2011 for the refurbishment of the 700.0km Plumtree-Mutare Highway.
  •  The loan was due to mature in 2021. However, an agreement has been reached to extend the loan for another 15 years with more favourable interest rates. 


  • According to the Head of the Central Bank of Zambia, Zambia is close to reaching a deal with the IMF that will be crucial to resorting to macroeconomic stability.
  • Also, in the past week, the World Bank announced that it would provide Zambia with additional funding of $105mn to help secure the livelihoods of about 300,000 of the poorest and most vulnerable households.
  • The Bank of Zambia offered treasury bills worth Kwh1.14bn at the auction. Stop rates for the 91-day, 182-day, 273-day and 364-day closed at 14%, 16%, 20% and 25%, respectively.


  • According to Wood Mackenzie and Bloomberg, Angola is set to load its least crude cargo in 13 years in Jul-21.
  • Ageing wells and years of low investment in the industry would see Angola export 991,00bpd in Jul-2021, well below its 2.0mbpd target.
  • In the past week, the Angolan government offered Kz2.0bn, Kz1.1bn and Kz2.7bn across three tenors, due to mature in 2022, 2024 and 2025 with stop rates closing at 15.7%, 16.2% and 16.5% across the bills, respectively.



  • According to a local news outlet, the Namibian, Germany has offered to give Namibia €1.1bn over 30 years to fund development projects for colonial-era misdeeds. 
  • The Namibian government sold N$500.0m worth of bills in the past week due to mature in Feb-22. Investor appetite for the bills was strong as they were oversubscribed at 1.7x. Stop rates for the bill closed at 4.6%.

Central Africa


  • According to media reports, Cameroon plans to raise $845.0m on the international capital markets this year. These funds will be mainly used to fully, or at least partially, repay the principal repayments on the country's only outstanding Eurobond.
  • Notably, s public debt levels have increased over the past decade, as fiscal debt rose to 47.1% of GDP in 2020, from 15.7% in 2011. Similarly, external debt increased to 30.0% of GDP from 7.2% within the same period. 

Proshare Nigeria Pvt. Ltd.

Visit African Markets in Proshare MARKETS

Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.

Related News

1.      The UBA Africa Conversations 2021: Africa to the World

2.     Snapshot of the African Economy as @ 140521

3.     Snapshot on African Economy as @ 070521

4.     Federal Reserve Board Issues May 2021 Financial Stability Report

5.     Snapshot on African Economy as @ 300421

6.     Federal Reserve Issues FOMC Statement and Implementation Note From Its April 2021 Meeting

7.     Snapshot on African Economy as @ 230421

8.     Understanding the Rise in Long-Term US Rates

9.     Snapshot on African Economy as @ 160421

10.  Snapshot on African Economy as @ 090421

11.   CCPC Fines Cement Companies for Anti-Competitive Trade Practices and Orders Adjustment of Prices

12.  A Very Different COVID-19 Story in South Africa

13.  China's 14th Five-Year Plan: A First Look

14.  Archegos Capital Fallout May Wipe $6bn From Global Banks

15.  Snapshot on African Economy as @ 260321

16.  Africa Displays Pockets of Positivity Amidst COVID-19 Fallout

17.  The Impact of COVID-19 on the Debt Capital Markets in Africa

18.  Snapshot on African Economy as @190321

19.  Federal Reserve Issues FOMC Statement and Implementation Note from Its March 2021 Meeting

20. US $1.9tn Stimulus... Positive for Nigeria?

Proshare Nigeria Pvt. Ltd.

Related News