VenturesNow

Kenya cools talk on debt default as delay in public service salaries continues

Published

2 years ago

April 11, 2023

President William Ruto’s chief economic adviser, David Ndii has maintained that the country will not default on its debt repayment obligations despite delayed payment of civil service salaries.

“Nairobi has no plans to go down that route”, said Ndii.

“We are not insolvent. We can finance repayments. It is a significant sacrifice but we are actually able to pay,” he added on Monday.

He said default was a “very bad idea” since it would force the government to “spend the next three to four years in very protracted debt restructuring negotiations.”

The delay has been due to a cash squeeze caused by massive interest payments. There are speculations Kenya could default on its loan deals like Ghana and Zambia.

Kenya’s debt has increased from 180 shillings nearly ten years ago to 680 billion shillings ($5.09 billion) this year, placing additional strain on the government cash flow.

Meanwhile, the situation has drawn reactions from the leader of the opposition in the national assembly, Opiyo Wandayi.

“Civil servants and MPs have gone to Easter without salaries,” Wandayi said in a statement issued during the weekend. Lawmakers had not received their March salary by April 7, a delay from the usual payment time of between March 26-30.

The International Monetary Fund recently warned public debt and inflation in most African countries were at “levels not seen in decades” and says several countries face “difficult sociopolitical and security situations.”

Related Topics:debt burden Featured Kenya

Click to comment

VenturesNow

Moroccan annual inflation rises to 0.8% in November

Published

2 days ago

December 21, 2024

Ifeoluwa Dada

Morocco’s statistics office has confirmed that the country’s annual inflation rate, as determined by the consumer price index, increased from 0.7% in October to 0.8% in November.

Monthly, consumer prices decreased by 0.2% from October.

The primary driver of inflation, food costs, grew by 0.8% compared to the previous year, while non-food inflation climbed by 0.7%. Core inflation, which does not include more erratic items like food, increased 2.6% annually and 0.2% monthly.

According to the central bank, inflation is expected to average 1% this year, down from 6.1% last year.

Despite the Al-Haouz earthquake, a spike in inflation, and worldwide economic challenges, Morocco’s GDP grew by 3.4% in 2023.

A recovery in tourism, robust industrial exports, and rising private consumption—all bolstered by prudent macroeconomic policies—were the main drivers of growth.

VenturesNow

Nigeria’s $42bn foreign reserves enough for 9 months’ imports— Central Bank

Published

3 days ago

December 20, 2024

Ifeoluwa Dada

According to Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), the nation’s $42.01 billion in foreign reserves can cover imports of goods and services for almost nine months.

Cardoso promised Nigerians improved economic fortunes in 2025 while addressing the Senate Committee on Banking, Insurance, and Other Financial Institutions yesterday in Abuja at the presentation of the performance index report.

Cardoso stated: “External Reserves rose from $ 38.35 billion it was on September 30, 2024, to $ 42.01 billion as of December 12, 2024”.

He clarified that third-party receipts in Q3 2024 and revenues from taxes connected to crude oil were the main drivers of the rise in foreign reserves during the specified time.

“We saw remarkable improvements in our trade balance and maintained a current account surplus,” he added.

“Our external reserves level can finance over 9.09 months of import of goods and services or 13.91 months only, higher than the international benchmark of 3.0 months and a robust buffer against shocks”.

On cash shortage, the CBN boss reiterated the N150 million fine against any branch of banks caught illegally distributing new Naira notes to currency hawkers and unscrupulous elements and said the Nigerian economy will improve in 2025 through policies and measures.

He predicted a stronger economic future: “Despite our economy’s challenges, there are clear reasons for optimism.

“The gradual stabilization of the forex market, ongoing banking sector recapitalization, and positive growth trends in key sectors, especially the services sector, indicate a path toward recovery and stability.”