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Japan overtakes China in bid to provide Kenya with fresh loans

Published

2 years ago

April 21, 2022

Japan has leapfrogged China in a bid to provide Kenya with fresh loans for developmental projects for the second year running.

While China has cut fresh financial commitment to the East African nation, Japan, on the other hand, has now moved to the top of the list of bilateral lenders to the country.

In November last year, President Xi Jinping of China had disclosed during the Eighth Ministerial Conference of the Forum on China-Africa Cooperation (FOCAC) that China would reduce investments in Africa by a third in three years.

Xi’s China had committed $40 billion to Africa, a 33.3 percent drop from the $60 billion in the last two FOCAC summits, which take place every three years.

A report by the Kenyan Treasury on Thursday, noted that the country’s budget estimates for the financial year starting July, listed Japan as the largest source of bilateral loans and grants, leapfrogging China which has been the biggest financier for nearly a decade.

“Beijing is projected to lend Kenya Ksh29.46 billion ($254.9 million) for the fiscal year 2022/23, a sharp cutback from Ksh140.03 billion ($1.2 billion) in the 2015/16 budget.

“That marks the second year in a row that China will trail Japan in bilateral loans, having committed Ksh21.25 billion ($183.9 million) in the current year ending June against Tokyo’s Ksh36.49 billion ($315.7 million).

“However, China remains the biggest bilateral creditor by far due to big-ticket deals it has inked with Kenya in the last decade to fund and build mega infrastructure projects such as roads and a modern railway.

“Kenya owed China $6.95 billion last December compared with $1.42 billion to Japan,” according to the latest data by the Treasury.

Related Topics:Featured Japan Kenya Loans

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Nigeria has received $10.9 billion multi-sector investments from AfDB— Official

Published

4 days ago

July 23, 2024

Ifeoluwa Dada

Nigeria has received $10.9 billion from the African Development Bank (AfDB), comprising $4.9 billion in public and private sector initiatives.

AfDB Director-General of the West Africa Region, Lamin Barrow, said the bank’s Nigeria funding approvals total $10.9 billion since it started operations.

Barrow made the revelation at the Second Interactive Session and Workshop on Developing Bankable Business Proposals/Business Plans for Youths in Agriculture in Abuja on Monday.

It was part of the bank’s 60th anniversary celebrations with stakeholders. Nigeria is the AfDB’s largest shareholder, and the bank’s relationship with it has grown, Barrow said.

The AfDB invests in Nigeria’s energy, power, transport, water, and sanitation infrastructure.

“Over the last 60 years, the Bank has grown into a trusted partner and the continent’s premier development financial institution.

“Our cooperation with Nigeria has expanded over the years, especially considering that Nigeria is the largest shareholder.

“Since it started operations in the country, cumulative financing approvals have reached 10.9 billion dollars and our portfolio currently stands at 4.9 billion dollars supporting projects in the public and private sectors,” he said.

After taking office eight years ago, AfDB President Dr Akinwumi Adesina prioritized the High 5—Power, Feed, Industrialize, Integrate, and Improve Africa’s quality of life—Barrow added. He said these were accelerators for achieving the SDGs and Agenda 2063 ambitions. The projects and programs supported during this time have reportedly affected over 400 million individuals.

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Analysts expect Egypt’s economy to rise 4.0% in 2024/25

Published

4 days ago

July 23, 2024

Ifeoluwa Dada

A recent study that sampled seventeen economists by Reuters has predicted slower economic growth for Egypt in April after a $8 billion IMF accord in March.

The median projection for GDP growth in the fiscal year starting July 1 was 4%, down from 4.35% in April and 4.15% in January.

The poll predicted the GDP grew 2.9% in the fiscal year ending June 30. This is below their April and January predictions of 3% and 3.5%. Poll: 2025/26 growth should rise to 4.99%.

After the IMF agreement, Capital Economics’ James Swanston predicted slower growth due to tighter fiscal and monetary policies and a weaker pound.

“The overall net impact is that economic growth will be weaker this fiscal year, but there are reasons to be more optimistic on GDP growth from FY2025/26 onward,” Swanston said.

Egyptian tourism and Suez Canal revenue have slowed due to the Gaza crisis, which has cut Egypt’s foreign revenue by more than half.

Egypt’s planning ministry predicted 4.2% growth in 2024/25 on June 2. Analysts expect the Egyptian pound to fall to 49.50 per dollar by June 2025 and 52.50 by June 2026.

Before dropping it in March 2024, the central bank kept the pound at 30.85 per dollar. It’s roughly 48.40 per dollar.

The survey forecast 20.5% headline inflation in 2024/25 and 12.05% in 2025/26. In June, inflation dropped to 27.5% from a record high of 38.0% in September, exceeding the central bank’s objective of 5%-9%.

The analysts expect the central bank’s overnight lending rate to drop to 21.25% by June 2025 and 15.25% by June 2026.

Foreign money shortages have slowed the Egyptian economy. However, a $24 billion real estate transaction with the UAE in late February, a significant currency devaluation, and a $8 billion IMF accord in early March have mitigated that.