The Markets | - Part 234

Rand Tumbles as South African Downgrade Concerns Return

Johannesburg, South Africa, Capital Markets in Africa — The rand weakened below 15 per dollar to the lowest in almost a month amid increasing expectations among economists that South Africa’s credit rating will be cut by the end of this year as growth falters. The rand fell as much as 1.2 percent to 15.1568, the weakest since April 7 on a closing basis, before paring its losses to be little changed at 14.9659 by 1:59 p.m. in…

Nigeria | Sub-Nationals on the Blink: A Case for Fiscal Restructuring

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LAGOS, Nigeria, Capital Markets in Africa — President Muhammadu Buhari met with members of Nigeria’s Governors Forum (NGF) yesterday, 28th April 2016. Expectedly, the state governors requested for more palliatives to ameliorate their fiscal challenges. The proposed palliatives include an 18-month moratorium on loans before resuming servicing, direct financial intervention and commitment of the Federal Government (FGN) to a Fiscal Restructuring Plan for Federating units which are yet to be made publicly available. This comes…

South Africa’s Rand Gains to Five-Month High Versus Dollar

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Johannesburg, South Africa, Capital Markets in Africa — The rand gained to its strongest level against the dollar in five months after South Africa unexpectedly posted a trade surplus in March for the first time this year. The currency gained 0.9 percent to 14.1611 per dollar by 2:46 p.m. in Johannesburg, heading for the strongest level since Nov. 24 and the best performance out of 31 major and emerging-market currencies monitored by Bloomberg. The rand has advanced 9.2 percent…

Greece’s Secret Debt Evoked in Mozambique $1 Billion Hole

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LAGOS, Nigeria, Capital Market in Africa — For some Africa watchers, Mozambique’s confession of a $1 billion debt hole seems strangely reminiscent of another country — one that’s also in contentious talks with the International Monetary Fund. The predicament reminds analysts including Rand Merchant Bank’s Nema Ramkhelawan-Bhana of Greece’s concealment of its true fiscal dilemma in the late 1990s and early 2000s. The IMF said last week that Mozambique failed to disclose government-guaranteed loans provided by Credit Suisse Group…

Exotix Says Nigeria is `Uninvestable’ Due to Currency Policy

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LAGOS, Nigeria, Capital Markets in Africa — Nigerian foreign-exchange controls are undermining political reforms by President Muhammadu Buhari and making the country “uninvestable” for buyers who measure returns in dollars, Exotix Partners LLP said. The reorganization of the state oil company’s structure, changes to the nation’s bureaucracy and Buhari’s efforts to curb corruption all point to “root and branch” changes to the country’s governance structures, Hasnain Malik, head of frontier markets strategy at London-based Exotix, said in an interview…

Kenyan Equity Valuations Buoyed by Low Oil, Politics — Exotix

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Nairobi, Kenya, Capital Markets in Africa — Kenya equity valuations that declined over the past year are now among the most attractive in sub-Saharan African frontier markets, supported by the lowest political risk in a decade and favorable global conditions, analysts from Exotix Partners LLP said. Lower oil prices, which benefit net crude importers like Kenya, and the prospect that the timing of U.S. interest-rate increases have been pushed out are expected to foster a “relatively benign environment…

Ghana’s Biggest IPO Said to Raise 450 Million Cedis for Lender

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ACCRA, Ghana, Capital Markets in Africa — Agricultural Development Bank Limited raised 450 million cedis ($119 million), the largest initial public offering in Ghana’s history, last month, according to two people familiar with the deal. The bank raised more than the target of almost 400 million cedis, said the people, who asked not to be identified because regulators are still reviewing the results. ADB will use 300 million cedis for capital and the rest to pay shareholders,…

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