Economy

LAGOS (Capital Markets in Africa) – Fitch Ratings indicated that the public debt level in Sub-Saharan African (SSA) countries has significantly increased, as the median debt level of the 19 Fitch-rated SSA sovereigns doubled from 27% of GDP at the end of 2012 to an estimated 56% of GDP at end-2018. It noted that SSA sovereigns have used some of the fiscal space that was afforded by the Highly Indebted Poor Countries initiative to boost…

CAIRO (Capital Markets in Africa) – Deutsche Bank considered that Egypt’s reform program with the International Monetary Fund has been successful in reducing macroeconomic imbalances and improving the country’s growth prospects. It projected real GDP growth to accelerate from 5.5% in the fiscal year that ends in June 2019 to 5.9% in FY2019/20, supported by higher oil, gas and renewable energy production, sustained spending on state-sponsored mega-projects, as well as by a recovery in private…

JOHANNESBURG (Capital Markets in Africa) – Moody’s Investors Service said South Africa’s credit-rating outlook is stable, giving the country’s new government more time to tackle key challenges such as low economic growth and embattled state-owned companies to ward off junk status. With May’s national elections over, the new government “will put forward policies to continue tackling the main credit challenges, including a low growth, steadily rising debt, leveraged state-owned enterprises and weakened institutions,” Moody’s said….

JOHANNESBURG (Capital Markets in Africa)  – Lesetja Kganyago, then the top official at South Africa’s Treasury, was taking a break at Sugarloaf Mountain in Rio de Janeiro between two G-20 meetings in November 2008 when he got the bad news. Barely three years after his country had managed to get its highest-ever investment-grade ratings from two of the three main credit-rating companies, the global financial crisis was threatening to reverse that progress. South Africa was…

ADDIS ABABA (Capital Markets in Africa) – Ethiopia plans to increase 2019-20 spending by 1.6% to fund projects that will help boost the Horn of Africa country’s economic expansion. Spending plans for the year starting July will expand to 386.9 billion birr ($13.4 billion), Ethiopian Finance Minister Ahmed Shide said in a recording of parliament proceedings aired on ruling party-controlled Fana Television. That will probably help the economy grow by 9%, according to Shide. Ethiopia, which the International…

LAGOS (Capital Markets in Africa) – Central banks in Kenya and Ghana are likely to keep interest rates on hold next week following in the foot steps of their larger peers in South Africa and Nigeria. Angola’s central bank is also set to leave interest rates alone as it aims to slow inflation even as it lets the currency weaken. Nigeria kept its key rate unchanged at 13.5% on May 21 and the South African…

LUSAKA (Capital Markets in Africa) – Moody’s Investors Service has cut its assessment of Zambia’s debt deep into junk territory citing a rising probability of default. Moody’s downgraded the southern African nation’s long-term foreign-debt rating to Caa2 — the fourth-lowest junk assessment — from Caa1 and reduced the outlook to negative, it said in an emailed statement Thursday. The higher risk of a default “reflects increasing credit challenges stemming from rising debt levels,” exacerbated by…