VenturesNow

Egypt’s inflation rate falls to 28.1% in May

Published

2 weeks ago

June 11, 2024

According to figures released on Monday by the statistics agency, CAPMAS, Egypt’s annual urban consumer price inflation slowed even more quickly than analysts had predicted, from 32.5% in April to 28.1% in May.

A survey by 19 analysts quoted by Reuters shows that inflation will drop to a median of 30.4%, maintaining a downward trend that began in September, when inflation reached its highest point of 38.0%. May 2023 saw a 31.0% increase in food prices compared to May 2023.

May marked the third consecutive month of decreases following an unexpected increase in prices in February. In May, prices decreased by 0.7% month over month, with food costs falling by 3.0%. Over the past year, there has been a significant increase in inflation, mostly due to the money supply expanding quickly.

A report by Statista predicted that Egypt’s gross domestic product (GDP) would rise steadily by 192 billion US dollars (+55.24%) between 2024 and 2029 at present prices. The GDP is predicted to reach 539.61 billion US dollars in 2029, marking a new peak, following the fourth year of growth.

The GDP in national currency is converted to US dollars using market exchange rates (yearly average) to determine the gross domestic product at current prices. The value of all finished products and services produced in a given year is represented by the GDP.

VenturesNow

In Nigeria’s northeast, more than 1,800 gas stations shut over smuggling

Published

17 hours ago

June 25, 2024

Ifeoluwa Dada

Nigeria’s local head of petroleum marketers stated that around 2,000 gas stations in the northeastern part of the country were closed over an anti-smuggling operation that targeted particular operators, forcing drivers to purchase gasoline on the black market.

The Nigeria Customs Service impounded tanker trucks and closed some fuel outlets on suspicion that they were smuggling gasoline to neighbouring Cameroon. This led to the suspension of operations at gas stations, according to Dahiru Buba, the chairman of the Independent Petroleum Marketers Association of Nigeria (IPMAN) for the states of Taraba and Adamawa.

For years, low-cost gasoline smuggled from Nigeria has been the main source of income for black-market fuel merchants in Cameroon, Benin and Togo.

That black market commerce collapsed when Nigeria eliminated its petrol subsidy last year, but since June 2023, Nigeria has capped the price of the commodity, even if its currency has sharply declined. As a result, the product is now once again cheaper.

Under “Operation Whirlwind”, Customs initially impounded some tanker trucks belonging to IPMAN members and released them after the association protested. But more trucks were seized and several fuel stations were shut, forcing fuel station operators to close outlets en-masse in protest, said Buba.

“We wrote to them (Nigeria Customs) again but there were no responses that is why we decided to go on strike,” he said, adding that over 1,800 outlets had ceased to operate.
“This is our business and we cannot be quiet when our members are treated this way.”

According to Taraba and Adamawa Customs spokeswoman Mangsi Lazarus, tanker trucks were impounded because they were being used to transport gasoline.

Black market dealers swiftly capitalized on the shortages in Adamawa’s capital city of Yola, selling gasoline for 1,400 naira ($0.9459) per liter instead of the 650–750 naira it was selling for at the pump.

VenturesNow

Ghana, bondholders finalize preliminary $13 billion debt agreement

Published

17 hours ago

June 25, 2024

Ifeoluwa Dada

Ghana announced on Monday that it had reached the final stages of a debt reform, becoming the second African nation this month, after reaching an agreement in principle with two bondholder organizations to restructure over $13 billion of its debt.

Under the terms of the agreement, bondholders in Ghana will forfeit around $4.7 billion of their loans, resulting in approximately $4.4 billion in cash flow relief until 2026, when the country’s current International Monetary Fund (IMF) programme ends.

“The formal launch of the consent solicitation is expected in the upcoming weeks,” the proposal, if approved, would allow the nation to avoid default, the administration stated, alluding to the process of presenting the proposal to all of its bondholders.

The initial information about the agreement, which will essentially equate to a 37% “haircut” in the bond market, was released by Reuters on Thursday.

The accord was deemed “a significant positive step” for Ghana by the IMF. The committee on behalf of its foreign bondholders declared that it would provide a route for the nation’s economic recuperation.

Following Ghana’s recent arrangement with its bilateral creditors and another slow-moving restructuring in Zambia earlier this month, the deal was made quickly.

The 18 months Ghana took “has been much faster” than Zambia’s, according to S&P Global Market Intelligence analyst Theo Acheampong, and this could help the country recover. A request for response was not answered by the Paris Club of Creditor Nations, which typically handles communications for official creditors.

However, the government noted that the official creditor committee, which is co-chaired by China and France, considered the deal to be a reasonable starting point for discussing its “Comparability of Treatment” concept, which is an analysis meant to make sure bondholders don’t receive too favourable conditions.

Bondholders now own two choices. One is a “disco bond,” with maturities spanning from 2026 to 2029 and an interest rate of 5% that will increase to 6% after mid-2028. It involves a 37% haircut or write-down of “principle.”

The second is a $1.6 billion par bond option with three instruments, the principal of which will mature in 2037 with no haircut other than a write-down of past-due interest and pay a 1.5% yield.

The government stated that about a different bond that is partially guaranteed by the World Bank, the unprotected section will be regarded similarly to the other portion of the nation’s bonds, and the multilateral lender will completely pay the guaranteed portion to investors.