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IMF Approves Additional $101.96M COVID-19 Loan for Malawi2 minutes read

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The Executive Board of the International Monetary Fund – IMF – has approved a disbursement of $101.96 million to Malawi under the Rapid Credit Facility (RCF), the organisation said in a statement on its website.

This is the second emergency disbursement since the onset of the pandemic and will help finance Malawi’s urgent balance of payment and fiscal needs. It follows the Executive Board’s approval of the disbursement of $91m on May 1, 2020.

Malawi’s economic outlook has worsened since the first RCF with the accelerated spread of the pandemic in the country and the deteriorating global and regional economic situation. As a result, external financing needs have substantially increased. The fiscal situation has also deteriorated with revenue losses and channeling of budget resources toward critical spending, including to support incomes and food security of the most vulnerable and increased health sector outlays—in line with Malawi’s national response plan supported by the World Health Organization and other development partners.

IMF financing under the second RCF will help fill part of the external financing gap and catalyze other concessional financing. The authorities have committed to transparency and accountability to ensure that the RCF resources are used appropriately and for their intended purpose.

Following the Executive Board’s discussion on Malawi, Zhang, Deputy Managing Director and Chair, issued the following statement:

“The authorities are actively implementing measures to mitigate the impact of the pandemic and preserve macroeconomic stability. Key steps include strengthening the health care system, stepping up social spending, ensuring food security, and easing liquidity constraints in the banking system.

The IMF’s emergency financing under the second RCF will help close the immediate additional external and fiscal financing gaps. Further concessional assistance from the international community will be critical to close the remaining external financing gaps during 2020 and 2021 and help ease the adverse economic and social impacts of the pandemic, while preserving Malawi’s hard-earned macroeconomic stability.

A widening of the budget deficit is appropriate in the near term, given the fiscal costs associated with the economic slowdown and critical pandemic-related spending, which should be executed transparently and targeted at the most affected segments of society. To safeguard medium-term debt sustainability and fiscal space for development initiatives, it will be important to formulate medium-term measures now—such as policies that strengthen debt management and boost domestic revenue mobilization—and implement them once the pandemic abates.

The authorities are committed to preserving macroeconomic stability, pursuing reforms in support of higher, more resilient, and broad-based medium-term growth, and improving governance. They have expressed their strong interest in a new Extended Credit Facility arrangement that is aligned with the long-term growth strategy currently under development.”

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Nigeria’s Central Bank Issues Guidelines For N75Bln Youth Investment Fund

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Nigeria’s apex bank to offer seven-year loans to youth corps members

The Central Bank of Nigeria (CBN) has released guidelines for implementation of the proposed N75 billion Nigeria Youth Investment Fund (NYIF).

CBN, in a statement by its Development Finance Department, stated that the fund was a built-in strategy to effectively respond to the challenge of youth employment in Nigeria.

The Fund, an initiative of the Ministry of Youth and Sports Development, is to be managed by NISRAL Microfinance Bank.

It stated that the major objective of the plan was to address fragmentation of youths initiatives that prevent assessment of impact.

`The Federal Executive Council on July 22, approved N75 billion for the establishment of the NYIF from 2020 to 2023.

“It will provide Nigeria youths with investment inputs required to build successful businesses that can become sustainable employers of labour and contributors to the country’s development.

“ The plan targets young people between 18 and 35 years and details the needed actions required to support business establishment, expansion and consequent employment creation for youths in critical economic and social sectors,” it stated.

The apex bank said that the fund was dedicated to investing in the innovative ideas, skills and talents of Nigerian youths.

It added that it would institutionally provide the youths with special window for accessing the funds, finances, business management skills and other inputs critical for sustainable enterprise development.

“The ministry is the lead implementation entity and is responsible for budgetary provisions and for funds mobilisation.

“The fund aims to financially empower youths to generate at least 500,000 jobs between 2020 and 2023,’’the apex bank said.

It added that part of the objectives of the fund was to improve access to finance for youths and youth-owned enterprises for national development.

“It will also generate much-needed employment opportunities to curb youths restiveness, boost their managerial capacity and develop their potential to become the future large corporate organisations,’’ it added.

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Nigeria’s Aliko Dangote Delays London Listing

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The Dangote Cement Company has delayed  it’s listing on the London Stock Exchange, again. The company announced that it will rather focus on selling it’s product to Central and other West African nations. And boost it’s foreign reserve and that of Nigeria in the process.

The firms head of investor relations, Temilade Aduroja disclosed their new path in Lagos this week. And, also projects that the continent’s biggest producer of the building material, could follow this path till 2023 at the least.

Nigeria’s Aliko Dangote is Africa’s richest man.The 63-year-old entrepreneur has a net worth of more than $14 billion, has long expressed his ambition for Dangote Cement to have a secondary London listing to diversify its ownership and have access to funds from international markets.

Yet, for one reason or another he’s never managed to make it happen.

Dangote had made an initial attempt in 2018 with a proposed list by 2019 but that was changed by former Chief Financial Officer, Brian Egan to 2020.

Nigeria’s biggest listed company by market value, Dangote Cement took advantage of a drop in yields in the domestic debt markets to raise 100 billion naira ($259 million) through commercial papers in May and April, the largest offering of its kind at the time.

The group adds that in July it’s looking to export clinker to 15 countries in Central and West Africa in a bid to boost revenue and resolve a scarcity of foreign exchange scarcity in Nigeria.

Clinker is a nodular material used as the binder in cement products.

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Air Tanzania Resumes Scheduled Flights To Harare

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Air Tanzania resumed scheduled flights to Harare on Wednesday after a seven-month suspension due to the COVID-19 pandemic.

The airline joins a host of other regional and international airlines that have resumed flights into Zimbabwe after the country reopened its skies at in October.

Some of the airlines that have resumed flights into the southern African country include Emirates, Ethiopian Airlines, Kenyan Airways, South African Airlink and Fastjet.

“The flights resume today on Oct. 27 2020 and will be served initially twice weekly on Tuesday and Friday.

“Air Tanzania will operate the route via Lusaka, Zambia using a Dash8-Q400 aircraft,’’ the airline said in a statement Tuesday.

An official at the airline said as with the new normal, the flights would be operated under new COVID-19 health regulations.

“We are thrilled to be resuming the Lusaka-Harare flights. This South bound route connects both Lusaka and Harare business people, tourists and academics to the port city of Dar-es-Salaam and beyond,” the official said.

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