VenturesNow

Nigeria’s central bank settles almost $2 billion FX backlog

Published

12 months ago

January 8, 2024

The Acting Director of Corporate Communications of Nigeria’s Central Bank, Hakama Sidi-Ali, has confirmed it settled almost $2 billion of forward liabilities in the past three months.

The pressure on Nigeria’s currency, the naira, which has lost more than 50% of its value on the official window since the FX market’s unification on June 14, 2023, is anticipated to be relieved with the clearing of the backlog. In September 2023, the CBN declared it would clear the approximately $10 billion foreign exchange backlog in two weeks.

The spokesperson claims that the payments represent the CBN’s continued efforts to settle all outstanding forward transactions to relieve the pressure on the nation’s exchange rate.

She said the central bank had also redeemed outstanding forward liabilities in the last three months. This action demonstrates the bank’s dedication to clearing outstanding debt and maintaining a working foreign exchange market, she says.

“This underscores the CBN’s commitment to the resolution of pending obligations and a functional foreign exchange market. These payments signify CBN’s ongoing efforts to settle all remaining valid forward transactions to alleviate the current pressure on the country’s exchange rate.

“It is anticipated that this initiative would provide a considerable boost to the Naira against other major world currencies and further increase investor confidence in the Nigerian economy.” Mrs Hakama Sidi-Ali said.

During his screening in the Senate, CBN Governor, Yemi Cardoso, estimated that the amount owed to foreign companies operating in Nigeria was at least $7 billion.

VenturesNow

IMF, Egypt reach agreement for fourth review of Egypt’s $1.2 billion loan request

Published

12 hours ago

December 26, 2024

Ifeoluwa Dada

Egypt and the International Monetary Fund (IMF) have reached a staff-level agreement over the fourth review of the Extended Fund Facility arrangement, which might lead to a $1.2 billion payout under the program.

In March, Egypt, struggling with rising inflation and cash shortages, consented to the $8 billion, 46-month facility. Its economic problems were made worse by a precipitous drop in Suez Canal revenue over the last year due to regional tensions.

Over the next two years, Egypt’s government has committed to raising its tax-to-revenue ratio by 2% of GDP, according to the IMF, emphasising removing exemptions rather than raising taxes.

According to a statement from the IMF, this would allow it to expand social expenditure to support vulnerable populations.

“While the authorities’ plans to streamline and simplify the tax system are commendable, further reforms will be needed to enhance domestic revenue mobilization efforts,” the statement said.

According to the IMF statement, Egypt had also committed to maintaining its commitment to a flexible currency rate and to taking more urgent action to guarantee that the private sector became the primary driver of development.

The IMF’s executive board still has to accept the fourth review’s staff-level agreement.

VenturesNow

Libya’s eastern govt accepts petrol subsidy elimination

Published

12 hours ago

December 26, 2024

Ifeoluwa Dada

In a recent statement, the eastern government of Libya claimed it had reached a consensus on a plan to eliminate gasoline subsidies and would draft a mechanism to carry out the accord.

Additional information on the idea was not released by the administration led by Osama Hamad, a challenger to the internationally acknowledged Tripoli-based government.

However, it is uncertain if Hamad’s government would be able to carry out the plan in the divided nation.

According to the Global Petrol Prices online tracker, a litre of gasoline costs just 0.150 Libyan dinars ($0.03) in OPEC member Libya, making it the second-cheapest in the world.

Following an uprising against former ruler Muammar Gaddafi in 2011, smuggling networks have thrived in the ensuing political unrest and armed fighting. In 2014, conflicting eastern and western governments separated the nation.

A World Bank analysis estimates that the annual value of fuel smuggling from Libya is at least $5 billion.

In a meeting with Mari Barrasi, the deputy governor of the Central Bank of Libya (CBL), located in Tripoli, and four members of the bank’s board of directors, Hamad in Benghazi supported the idea of removing subsidies.

The CBL’s Benghazi branch offices served as the venue for the conference.

The eastern parliament appointed Hamad in 2023 to succeed Abdulhamid Dbeibah, who had been put in position in 2021 under a U.N.-backed procedure that the parliament said had lost its legitimacy.

Dbeibah, who is located in Tripoli, stated in January that he will conduct a public poll on the topic of eliminating gasoline subsidies, but he hasn’t done anything about it since.

According to CBL figures, gasoline subsidies cost 12.8 billion Libyan dinars between January and November of this year. 4.8 Libyan dinars to $1 is the official exchange rate.