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Uganda announces plan to double domestic borrowing

Published

1 year ago

December 5, 2023

Uganda’s finance ministry wants to exceed double of its level of domestic market borrowing to 6.8 trillion Ugandan shillings ($1.79 billion) in the 2023/24 financial year as it pushes to finance new spending needs.

The ministry claims the extra borrowing will likely put pressure on interest rates. Rising debt service costs, according to government officials, opposition politicians, and the central bank, have been eating away at the money needed to pay for basic necessities.

“Whereas we can not pre-determine the level of interest rates for domestic borrowing, it is certain that the rates will move upwards,” the ministry said.

“External loans are currently very expensive with interest rates of about 10% per annum on foreign currency. This makes the debt service cost of external loans unsustainable.”

Last week, the east African country said it would seek to borrow $150 million from China’s Export-Import Bank (Exim), following lending restrictions by the World Bank— which is traditionally a key source of cheap credit for the country— over its anti-homosexuality law.

Also, the government requested last week that parliament authorise an additional 3.6 trillion shillings in borrowing.

Finance Minister, Matia Kasaija, announced in a June budget speech that the government planned to issue bonds and treasury bills to raise 3.2 trillion Ugandan shillings from the domestic market.

Related Topics:Domestic borrowing Featured Uganda

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Moroccan annual inflation rises to 0.8% in November

Published

4 minutes 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.

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

Published

1 day 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.”