Following Angola’s deal with the IMF, the country is preparing to return to the bonds market. According to Angola’s Treasury Secretary, Vera Daves ,the IMF deal with Angola hopes to kick-off a three-year privatisation programme this year
Pushed towards an economic crisis by the fall in crude prices since mid-2014, Angola, Africa’s second-largest oil producer, secured $3.7bn of International Monetary Fund aid in December.
Its currency, the kwanza, dropped more than 40 percent last year making it the second worst performing in the world after Argentina’s peso.
The country’s debts also jumped and international reserves fell to a seven-year low of $11.1bn in December.
Daves said the country had financing needs of around 3.5trn kwanza ($11.32bn) this year compared to the nearly 5trn kwanza it spent in 2018, and was hoping to look to international markets to secure some of the money.
As a preparatory move in 2018, Angola sold a $1.75bn 10-year bond at a yield of 8.25 percent
Asked how soon it could happen, Angola’s Treasury secretary said it would depend on investor appetite.
President João Lourenço, who took over in September 2017 after 38 years of rule by José Eduardo dos Santos, says he wants to revive Angola’s fortunes by tackling corruption, opening it up to foreign investment and diversifying away from oil, which accounts for more than 90 percent of exports.
The IMF programme is aimed at bringing stability to the country and fostering a return of economic growth, especially in the second half of the year, when Daves expects an expansion of around 2.8 percent.
Inflation rate drops to its lowest in 8 years in South Africa
South Africa records its lowest Annual consumer inflation of 3.7% since February 2011
Inflation in South Africa reached an eight-year low last month on the back of low fuel prices, official figures showed Wednesday.
“Annual consumer inflation continued its downward streak, dropping to 3.7% in October from 4.1% in September,” South Africa’s statistics department StatsSA said Wednesday, adding that the figure was the lowest since February 2011.
The announcement comes as a relief to Africa’s most industrialised economy, whose currency has been weakened by years of low growth and mass layoffs.
StatsSA said the drop was mainly fuelled by a 4.9-per cent decline in fuel prices from October last year.
Food and non-alcoholic beverages, housing, and goods and services were the main contributors to the annual rise in prices.
Among food, the most notable price increases were observed among bread and cereal, fish and fruit.
Average inflation stood at 4.2 per cent between January and October in 2019, down from 4.6 per cent over the same period last year.
Gold mine output in Burkina Faso decline with Jihadists attacks
Recent raids at gold mines in Burkina Faso reduce mine activities owing to insecurities of investors, expats and mine workers
Jihadist attacks on gold miners in Burkina Faso could seriously set back the rising production of a mineral that is a strategic export for the government, warn experts in the sector.
Early this month, President Roch Marc Christian Kabore’s government called three days of national mourning after 38 people were massacred in a November 6 ambush on a convoy near the Boungou mine in eastern Burkina.
Kabore blamed “terrorists” for the deadliest such attack since a spiral of jihadist violence began in the deeply poor West African country five years ago, in parallel with a gold rush.
“The mines go on operating, but this is going to have repercussions on activity,” said a senior government official who asked not to be named. “A kind of psychosis is setting in.”
Gold mines in partly arid Sahel nations south of the Sahara have become a source of finance for jihadists and other armed movements in areas lacking in central authority, the International Crisis Group said in a new report.
In Mali, Niger and Burkina Faso, “armed groups have seized gold mining sites since 2016 in areas where states are weak or absent. Artisanal gold mining has boomed since the 2012 discovery of a Saharan vein stretching from Sudan to Mauritania,” the ICG declared.
Though jihadists were driven out of desert towns in northern Mali in a mainly French offensive in 2013, armed Islamic extremists have moved deeper into Mali and across borders into Niger and Burkina Faso, adding mine workers to their targets.
Canada-based Semafo, which runs Burkina’s Boungou and Mana mines, in mid-November suspended operations until further notice out of “respect for the victims” of the attack and their loved ones.
Great economic value –
The firm flew workers home from the mine site by helicopter.
“Many of the people on-site need to be at home with their families and to recover from last week’s incident,” Semafo President Benoit Desormeaux explained in a statement.
In the past dozen years, gold mining has taken on a great economic value in the country of some 20 million people, landlocked in West Africa and once dependent on cotton exports for foreign earnings.
From 0.40 tonnes in 2007, gold production rose to more than 52 tonnes in 2018, according to Burkina’s Chamber of Mines. Twelve industrial mines were being operated at the end of 2018, with four more due to open in the near future.
Gold in 2018 supplied 11.4 per cent of Burkina Faso’s gross domestic product, generating 1.5 trillion CFA francs of export income and 266 billion CFA francs in tax revenue, according to the Ministry of Mines.
The official gold production industry includes 9,200 hands-on jobs and 26,100 subsidiary workers. But the unofficial, artisanal gold-panning sector employs 1.5 million people and brings an extra 10 tonnes of gold to annual production, the ministry reports.
For the ICG, “the growth of artisanal gold mining threatens the state in other ways”, by encouraging the rise of smuggling and money-laundering networks.
“Artisanal gold mining provides armed groups, in some cases including jihadists, with a new source of funding and potentially even recruits,” the report said. “If left unregulated, it risks fuelling violence in the region.”
‘Upset investors’ –
With repeated attacks on the gold business, jihadist groups are seeking to hit Burkina Faso hard in the national coffers.
The latest raid was the third to target workers at the Boungou mine. Two previous attacks killed 11 people, mostly members of the security forces escorting convoys, in 2018.
In all, the mining sector has been struck by at least 10 attacks causing deaths, injuries and damage to property in the past two years.
“It’s easier to carry out ambushes against convoys than to attack the mines, which are relatively well protected,” a mining executive told reporters, asking not to be named.
Islamic extremists also try to kidnap expatriate staff.
In January 2019, a Canadian geologist was abducted at Tiabangou in eastern Burkina Faso and later murdered by his kidnappers.
In September 2018, an Indian and a South African were snatched at the Inata gold mine in the north. A Romanian who worked in the huge manganese mine at Tambao, also in the north, has been held since he was abducted by jihadists in April 2015.
“Even if mining sites are not directly targeted in the attacks, this is going to upset investors. They will hesitate to fund new projects,” the mining executive said.
“The other problem is that this insecurity frightens off the expats. So the mining firms have difficulty in attracting qualified expat personnel,” he added.
“Mining groups have greatly reduced their prospecting activities in Burkina because they can’t work there normally,” noted a mining equipment supplier.
“There will be repercussions for production in the long term.”
South African Airways cancels flights ahead of strike
Around 3,000 South African Airways workers are expected to take part in the open-ended strike starting Friday
South African Airways (SAA) said Wednesday it was cancelling all its flights as thousands of workers vowed to press ahead with an indefinite strike the following day after the troubled national carrier announced a major retrenchment plan.
Around 3,000 workers, including cabin crew, check-in, ticket sales, technical and ground staff, are expected to take part in the open-ended strike starting Friday, their unions said.
The looming shutdown forced SAA to announce in a late-night statement on Wednesday that it “has cancelled nearly all its domestic, regional and international flights scheduled for Friday, November 15 and Saturday, November 16”.
“The airline’s key objective is to minimise the impact of disruptions for its customers,” it said.
Unions earlier Wednesday vowed their members would forge ahead with the strike, which the state-owned airline warned could collapse the embattled carrier.
“We are embarking on the mother of all strikes,” Zazi Nsibanyoni-Mugambi, president of the South African Cabin Crew Association (SACCA) told a news conference in Johannesburg.
“We are grounding that airline on Friday,” said Irvin Jim, general secretary of the National Union of Metalworkers of South Africa (NUMSA).
The unions are pressing for a three-year guarantee of job security and an eight per cent across-the-board wage hike.
‘Mother of all strikes’ –
Pilots — who are not taking part in the strike – have accepted a 5.9-per cent increase, they said.
The airline had announced on Monday a restructuring process that could affect 944 employees and “lead to job losses”.
The airline, which employs more than 5,000 workers, is one of the biggest in Africa, with a fleet of more than 50 aircraft providing dozens of domestic, regional and European flights each day.
But the company is deep in debt, despite several government bailouts, and has not recorded a profit since 2011.
The unions blamed the SAA board and executive management for the airline’s crisis.
“They have deliberately destroyed what used to be one of the world’s best airlines, because of maladministration, rampant looting and corruption,” they said in a statement.
SAA Chief Executive Officer Zuks Ramasia warned that the strike would “exacerbate rather than ameliorate our problem” and urged the unions to make affordable demands.
“The unions and all employees should be mindful of the current financial constraints the company is facing,” she said in a statement.
She said the unions were aware that the airline’s financial woes were “caused by a number of factors, including a severely distressed global airline industry.”
This, she argued, had resulted in “numerous airlines retrenching staff, embarking on cost-reduction programmes, implementing wage freezes, reducing operations, or even closing down.”
The airline has been surviving off government bailouts. Finance Minister Tito Mboweni announced in February that the government would reimburse the company’s 9.2-billion-rand ($620-million) debt over the next three years.
South Africa is struggling to get its state-owned companies back on track after nine years of corruption and mismanagement under former president Jacob Zuma.
Analyst Daniel Silke warned in a tweet that the planned strike “may kill an airline already on its knees affecting the jobs of thousands more.”
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