Over the past week, many important stories from around the African continent have been published, and we have served you some of the most topical ones.
Here is a rundown of the backstories of some of the biggest news in Africa that we covered during the week:
Musings on CBN rates across Africa: Ghana, Nigeria, and South Africa
During the week, many African countries announced monetary policy decisions. The Central Bank of Nigeria decided unanimously on Tuesday to raise its benchmark interest rate by an additional 50 basis points, to a new record high of 27.25%. This is the sixth hike in a row this year. The decision was made in an effort to reduce inflation, strengthen the naira, and draw in capital. Governor Olayemi Cardoso reaffirmed the bank’s commitment to controlling inflation and underlined how several rate hikes have contributed to its moderation.
Nigeria’s West Africa neighbour followed suit on Friday as the Bank of Ghana reduced its benchmark monetary policy rate by 200 points to 27% at a normal meeting. With inflation having slowed and disinflationary pressures mounting, this is the first decline in eight months and the steepest since March 2018. August 2024 saw a fifth consecutive month of decline in Ghana’s annual consumer inflation, which was still much higher than the central bank’s medium-term target range of 6% to 10%. The country’s annual inflation rate dropped to a nearly two-and-a-half-year low of 20.4% from 20.9% in July.
A week prior, as anticipated, the South African Reserve Bank decreased its benchmark interest rate by 25 basis points to 8% after holding seven consecutive meetings at a 15-year high of 8.25%. As price pressures decreased, the SARB is loosening policy for the first time since the epidemic in 2020
As monetary varying shifts across the continent continue, African nations are still facing numerous severe shocks and significant structural challenges, such as rising food and energy prices brought on by geopolitical tensions like Russia’s invasion of Ukraine, climate issues that impact agriculture and energy production, and ongoing political instability.
Africa’s real GDP growth slowed to 3.1% in 2023 from 4.1% in 2022 as a result of this difficult climate. With growth predicted to reach 3.7% in 2024 and 4.3% in 2025, the economic picture is projected to improve going ahead, underscoring the resilience of African countries.
Zambia and its post-drought plans
Zambia’s finance minister, Situmbeko Musokotwane stated on Friday that the nation intends to quickly recover from its worst drought in living memory and cut its budget deficit in half the following year.
The minister stated in a budget address that the copper producer hopes for a 6.6% growth in 2025, as opposed to a projected 2.3% increase in 2024. The country is aiming for a speedy recovery. as the government crop assessment data shows that over nine million people are affected in 84 of the 117 districts after suffering through the driest farming season in over forty years, which has led to considerable crop losses, an increase in livestock deaths, and worsening poverty,
Real GDP increased gradually between 2022 and 2023, from 5.2% to 5.8%. The supply side was driven by mining and quarrying, wholesale and retail commerce, and agriculture; the demand side was driven by consumer and business spending. Food prices, transit expenses, and the nominal exchange rate are the key drivers of inflation, which is expected to remain elevated and reach 11.0% and 10.9% at the end of 2022 and 2023, respectively.
The economic challenges faced by Zambia are exacerbated by the drought, especially when considering its debt load. Its debt restructuring talks under the G20 Common Framework have progressed far more slowly than was originally anticipated when the Common Framework was first proposed.
In 2017, Zambia was placed under debt distress, and as a result, non-concessional lending from multilateral development banks was discontinued. It’s possible that by overestimating sovereign risks, the main credit rating firms exacerbated the debt crisis and dealing with a post-drought crisis might just be another “too high hurdle”
As the World Bank and Uganda LGBTQ saga continues
The World Bank is taking more action in support of Uganda’s LGBTQ community. The global lender announced on Wednesday that it is implementing steps to guarantee that lenders to Uganda are not subjected to discrimination due to a severe anti-gay law. According to a World Bank representative, both new and continuing projects would be subject to the procedures, which also include an impartial monitoring system to guarantee compliance.
Same-sex partnerships are forbidden and punishable by life in prison; similarly, anyone convicted of “aggravated homosexuality” faces the death penalty. The Anti-Homosexuality Act (AHA) was passed by Uganda, a largely conservative nation, in May of last year and it has led to considerable Western censure and US penalties.
Other than Uganda, several African nations have strict laws that discriminate against individuals who identify as LGBTQ. Hakainde Hichilema, the president of Zambia, issued a warning in March to supporters of the LGBTQ movement to stop endorsing homosexuality. He also asked that Zambia “maintain laws that abhor alien orientations like gayism and lesbianism.”
South Africa, which has a constitution that forbids discrimination based on sexual orientation, was the first and only African nation to legalise same-sex marriage in 2006. Some African nations, such as Angola, Mozambique, Botswana, Lesotho, Mauritius, and Seychelles, have laws that are favourable to the continent’s population but Uganda appears to be unbothered or tempted despite the many causes and costs of its anti-gay stand.
Ahead of Tunisia’s presidential election
During the week, another Tunisian presidential candidate Ayachi Zammel was convicted and sentenced to six months imprisonment for using “fraudulent certificates” as opposition voices in the North African country continue on attack as President Saied positions himself for what is likely to be a reelection, as all but one of the opposition candidates are either incarcerated or have had their eligibility ruled invalid by the Tunisian electoral commission.
On September 19, a third candidate who had received the election commission’s approval was sentenced to 20 months in prison. Saied, who is currently running for reelection for a second five-year term, was originally elected in 2019 as an anti-establishment candidate who pledged to combat poverty and eradicate corruption. However, in 2021 he declared that he would rule by decree after overthrowing Mohamed Ennaceur and the elected parliament, a move denounced as a coup by the opposition and the international community.
Additionally, he has deployed more oppressive strategies, which may indicate that he is not confident in his ability to win with conviction. His severe actions could indicate a new stage in Tunisia’s democratic backsliding and foreshadow more crackdowns and turmoil during an inevitable second term.
Meanwhile, concerns exist over potential voting turnout as well. Under Saied, Tunisia has conducted three elections, with dismal voter turnout in each. Less than one-third of voters cast ballots in favour of a new constitution that solidified Saied’s power and overthrew the 2014 charter in July 2022. After Saied dismissed the previous legislature in December 2022, only 11% of voters cast ballots for new members of parliament, which is among the lowest turnout percentages ever recorded in a national election worldwide. The next December, Saied called elections for a new second house of parliament, repeating this dubious performance.
