Finance

JOHANNESBURG (Capital Markets in Africa) — The World Bank has told South Africa’s government it has to cut its wage bill to qualify for a loan of as much as $2 billion and doesn’t want the money used to bail out insolvent state companies, a person familiar with the situation said. Those conditions have stalled negotiations on the loan that began in April, the person said, asking not to be identified because the content of…

LUSAKA (Capital Markets in Africa) — The last time Zambia renegotiated its external debt, the well-oiled machine established by institutional lenders and western governments handled it with little trouble. But 15 years later, with the southern African nation in the throes of a $12 billion debt overhaul, China and bondholders have emerged as powerful new players to upend the choreography. Beijing is embroiled in a feud with money managers in New York and London, putting…

HARARE (Capital Markets in Africa) — S&P Global Ratings Services cut its assessment of Zambia’s debt to selective default after the southern African nation said it couldn’t meet payments and skipped a coupon on its Eurobonds last week. The action is the latest blow to Africa’s second-biggest copper producer, which is trying to convince bondholders to give it a six-month interest-payment holiday while it drafts debt-restructuring plans. The rating company, which didn’t wait for a…

LUSAKA (Capital Markets in Africa) — The clock is ticking for Zambia to convince reluctant bondholders to accept an interest-payment holiday while it works out a debt-restructuring strategy. If investors refuse Zambia’s request for a six-month standstill in a key vote on Tuesday, it may become the first African nation to default since the onset of the coronavirus. That could set a precedent for how cash-strapped governments treat private and Chinese creditors. The southern African…

NEW YORK (Bloomberg) — Working from home hasn’t slowed down Wall Street’s trading desks. The five biggest U.S. investment banks are on pace for their first $100 billion years for trading revenue in more than a decade. In just three quarters, they’ve already generated almost $84 billion, more than any full year since 2010. Sell-side traders rode a wave of activity as markets plunged at the start of pandemic-spurred lockdowns before embarking on dramatic rebounds….

LAGOS (Capital Markets in Africa) — One of two candidates to lead the World Trade Organization said she wants the body to overcome its problems so that it can create a level playing field for international commerce and see a return to a multilateral system. “Let us get back to a multilateral system. Let’s strengthen that — that is what will serve the world and let’s do less of the bilateral spats that we see,”…

MAPUTO (Capital Markets in Africa) — Mozambique published its proposed model for a sovereign wealth fund as it prepares to reap as much as $96 billion — more than six times the size of its current gross domestic product — from liquefied natural gas projects that companies including Total SE are building. The developments, which are the biggest private investments yet in Africa, could make Mozambique the continent’s second-biggest producer of the fuel. The central…