The Editorial Team |

Nigeria to Cushion Subsidy-Cut Impact, Buhari Adviser Says

LAGOS (Capital Markets in Africa) — Nigeria is considering ways to cushion the impact of fuel-subsidy cuts as it weighs the possibility that the reform may stoke popular discontent, an adviser to the nation’s president said. While those policies are being formulated, the state is continuing interventions that it says cost an estimated 744 billion naira ($1.8 billion) a year from 2006 to 2019 to maintain lower gasoline prices. That’s equivalent to about 10% of…

NIGERIA REACT: CBN Holds Key Rate, Clarifies Exchange Framework

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LAGOS (Capital Markets in Africa) — The Central Bank of Nigeria kept its key policy rate unchanged at 11.5% at its March meeting, as was widely expected. The decision reflects the committee’s desire to strike the right balance between support for the economy and the need to contain the country’s rising inflation pressures. Governor Godwin Emefiele also confirmed the devaluation of the naira but rejected claims the CBN had moved to a flexible exchange rate…

Nigeria Using Managed-Float Forex Regime, Central Bank Says

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LAGOS (Capital Markets in Africa) — Nigeria has not changed its foreign exchange policies from a managed float to a flexible regime, Central Bank Governor Godwin Emefiele said Tuesday. A report concluding that the country has adopted a flexible foreign-exchange rate based on comments by Finance Minister Zainab Ahmed is wrong, according to the Governor. Africa’s largest crude producer now uses the more flexible Nafex rate for all official transactions, abandoning the 379 naira to the dollar…

Cash Is King for Emerging Nations Facing Spike in Yields

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LAGOS (Capital Markets in Africa) — Cash is king may well be the mantra for emerging markets this year. With the relentless increase in Treasury yields pushing up global borrowing costs, developing-nation bond investors are scrutinizing the cash reserves of governments as they look to pick future winners. Russia, South Africa, and Indonesia may be among the best performers as they have each built up a sizable backstop. “It all boils down to flexibility and…

IMF Mulls Creating $650 Billion in Reserves After Yellen Nod

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NEW YORK (Capital Markets in Africa) — The International Monetary Fund’s board conveyed broad support for drafting a proposal to create $650 billion in additional reserve assets to help developing economies cope with the pandemic, with an eye on considering a formal plan by June. The institution’s executive board discussed the case for the reserves informally on Tuesday, IMF Managing Director Kristalina Georgieva said in a statement after the conclusion of the meeting. Fund staff will develop…

World’s First Wildlife Bond to Track Rhino Populations in Africa

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LAGOS (Capital Markets in Africa) — A bond designed to raise funds to grow the population of endangered black rhinoceros in South Africa will be sold by the World Bank this year. The five-year, 670 million rand ($45 million) security will be the world’s first wildlife conservation bond and the aim is to sell it in the middle of the year. Returns for investors will be determined by the rate of growth of the populations…

Suez Canal Snarled With Giant Ship Stuck in Top Trade Artery

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CAIRO (Capital Markets in Africa) — A giant container ship ran aground in the Suez Canal, blocking off one of the world’s busiest maritime trade routes that’s vital for the movement of everything from oil to consumer goods. The hull of Ever Given, one of the biggest container ships in operation, became wedged lengthways across the canal early Tuesday in Egypt, leaving at least 100 vessels gridlocked as they attempted to transit between the Red…

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