Ghana expects debt restructuring deal to herald US $1.15 billion from the IMF and the World Bank

Good morning, and a warm welcome to ThinkBusiness Africa, your Monday – Friday dose of commentary, contexts, and insights on business and economic news that matter to you.

Remember to visit www.tb.africa to continue to enjoy the second phase of our media services development. Also remember to share your feedback.

ThinkBusiness Africa thank you.

Please, also share so we can continue to build a community of “business thinkers”.

In partnership with

Africa Headlines

Ghana expects debt restructuring deal to herald US $1.15 billion from the IMF and the World Bank – Ghana, West Africa’s second largest economy is expecting the conclusion of its debt restructuring agreement this January to pave way for an injection of US $1.15 billion from the IMF and the World Bank. The sum consists of another tranche of US $600 million of the country’s 36-month US $3 billion extended credit facility with the IMF reached in May 2023, and US $550 million budgetary support and financial stability fund from the World Bank, according to Bloomberg. Ghana was the second African country to default on its debt since Covid – 19, after Zambia. Ethiopia defaulted two weeks ago. After the default, the IMF board approved a 36-month US $3 billion extended credit facility in May 2023. So far, US $600 million has been disbursed.  Also, the IMF is disbursing US $60.7 million to Mozambique after conclusion of the third review of its US $456 million extended credit facility programme agreement reached in 2022. So far, US $273 million has been disbursed. 

South Africa’s external reserves reach US $62 billion – Latest data shows that South Africa’s foreign reserves reached US $62.5 billion in December 2023, up from US $61.7 billion in November 2023, according to BusinessDay South Africa reports. In Nigeria, the 30-day moving average of the country’s foreign reserves, both gross and liquid, shows an uptick from December 18 last year, according to Central Bank of Nigeria (CBN) data. In Egypt, foreign exchange reserves rose to US $35.2 billion in December 2023, the highest since May 2022, according to data from Trading Economics. 

Global

France has a new Prime Minister – Gabriel Attal, appointed yesterday by the French President Emmanuel Macron as the country’s new Prime Minister is the youngest to assume the position. The 34-year-old education minister becomes the youngest to ever hold the position. He replaces Primer Minister Elisabeth Borne who resigned on Monday. The government has tried to push through critical reforms in the last few years, including contentious pension and immigration reforms. The major challenge for the President and the new Prime Minister is that the government does not have a majority in parliament.

Blinken says Israel agrees ‘diplomatic path’ is best for security – In his latest trip to Israel and the Middle East, the US Secretary of State has not acknowledged that “civilian deaths are too high” but also that diplomatic resolution is best for security. According to reports, Israel and US is pursuing diplomatic solution for the security of Northern Israel residents. Blinken emphasized the importance of ensuring the return of 80,000 Israelis to their homes safely. He also dismissed South Africa's accusation of genocide against Israel at the International Court of Justice in The Hague, calling it baseless, but acknowledged the need for further efforts to address the humanitarian crisis in Gaza.

Japanese wage growth slows as bets on BoJ monetary policy pause grow – Wage growth in Japan slowed sharply in November, strengthening investor bets that the Bank of Japan will maintain its ultra-loose monetary stance later this month. Nominal cash wages for workers rose 0.2 per cent from a year earlier, compared to a 1.5 per cent growth in October. Economists blamed sampling issues for the sharp slowdown, noting that wage growth remained relatively robust at 2 per cent excluding the sampling bias. Real wages, however, fell 3 per cent, compared with a 2.3 per cent decline in October. BoJ governor Kazuo Ueda has argued that more evidence of wage growth was needed for the central bank to be confident that it can sustainably achieve its 2 per cent inflation target.