Africa This Week (20/07/2024)
Public sector workers in Nigeria on Thursday see their minimum wage double following an agreement between the government and labor unions, which had been threatening further strikes due to the rising cost of living. The new minimum monthly wage is set at 70,000 naira ($44), significantly lower than the unions’ demand of nearly 500,000 naira. The new wage requires legislative approval before taking effect. Since President Bola Tinubu took office last May, his policies, including the removal of fuel subsidies and unifying exchange rates, have led to a significant devaluation of the naira and soaring inflation, which reached 34.1% last month.
The International Monetary Fund (IMF) has reduced Botswana’s 2024 growth forecast to 1% from an earlier estimate of 3.6% on Friday, citing lower diamond production. The budget deficit is expected to widen to 6% from 3.45% due to declining mineral revenues. The IMF suggested Botswana slow new infrastructure projects to stabilize the economy. The economic slowdown is primarily due to decreased diamond production, with lower consumer demand and global economic weakness affecting the diamond market. Diamonds account for 30-40% of Botswana’s revenue and 75% of its foreign exchange earnings.
The central banks of the UAE and Ethiopia signed agreements on Tuesday to facilitate cross-border transactions using local currencies and to integrate their payment and messaging systems. This move aims to enhance financial and commercial cooperation by providing liquidity in local currencies for more efficient transaction settlements. The agreement allows the CBUAE and the NBE to exchange up to AED 3 billion and ETB 46 billion, respectively. This development follows Egypt’s $1.4 billion local currency swap agreement with the UAE in 2023. The MoU also includes collaboration on payment platform services, linking instant payment systems, and exploring financial technology and digital currencies.
Egypt will halt load-shedding power cuts starting Sunday after receiving natural gas shipments, Prime Minister Mostafa Madbouly announced. The move aims to resolve a power crisis affecting the country’s 106 million residents. High cooling demand during summer has caused power shortages, with daily consumption exceeding 37 gigawatts, a 12% increase from last year. Egypt, which primarily generates electricity from natural gas, received five cargoes of liquefied natural gas (LNG) out of 21 contracted shipments. The petroleum ministry noted these shipments contain 155,000 cubic meters of LNG. To end the power cuts, Egypt needs to import $1.18 billion worth of natural gas and mazut fuel oil. The country has not imported LNG since 2018, but rising population and urban development have increased power demand. Looking ahead, the government plans to invest in renewable energy to meet summer energy needs by 2025.
The United States will provide an additional $203 million to support millions of civilians impacted by the ongoing war in Sudan, announced U.S. Ambassador to the United Nations Linda Thomas-Greenfield on Thursday. The funds are intended to assist civilians in Sudan and those who have fled to neighboring countries since the conflict between the Sudanese army and the paramilitary Rapid Support Forces (RSF) began in April 2023. The U.N. reports that nearly 25 million people, half of Sudan’s population, need aid, with 10 million displaced and over 2.2 million seeking refuge in other countries. The additional funding brings total U.S. aid for Sudanese civilians to $1.6 billion since the conflict’s onset.
Rwanda’s President Paul Kagame was re-elected to a fourth term with 99.18 percent of the vote, according to an announcement made by the National Electoral Commission on Thursday. Kagame, who has been the de facto leader for three decades, faced only two challengers, as the courts barred his most prominent critics. Frank Habineza of the Democratic Green Party of Rwanda received 0.5 percent, and independent Philippe Mpayimana garnered 0.32 percent. Eight other candidates were disqualified due to incomplete registration documents. Kagame, 66, thanked the population for their trust and expressed hope for solving future challenges together. Despite criticism for his authoritarian governance and regional instability, He has been in power since 2000 and could potentially remain until 2034, following a 2015 referendum that lifted presidential term limits.
A Kenyan court has suspended a police ban on protests in Nairobi, affirming citizens’ right to peaceful demonstration. The High Court’s decision came ahead of a planned protest against President William Ruto, calling for his resignation due to poor governance. The police had previously barred protests, citing a lack of leadership to ensure peaceful conduct. Despite the court’s ruling, major roads to the president’s office remained barricaded, and businesses in Nairobi closed in anticipation. Protests began over a controversial finance bill proposing higher taxes amid economic distress, leading to at least 50 deaths since June 18. President Ruto, who dismissed most of his Cabinet last week, has faced increasing pressure due to alleged incompetence and corruption among ministers. The economy has suffered losses worth $45 million due to ongoing demonstrations. Accusations of police brutality have led to the resignation of former inspector general Japhet Koome, with multiple cases under investigation.
The United States this week announced the extension of a humanitarian truce in eastern Congo, reducing violence and human rights abuses despite ongoing conflict. The truce, originally set to end Friday, is now extended until August 3. The State Department urged all parties to honor the truce, which had been violated since its July 5 inception. Violence in North Kivu province, marked by arbitrary killings, arrests, and sexual abuses affecting women and children, continues to exacerbate the humanitarian crisis. Over 100 armed groups, including the allegedly Rwanda-backed M23, vie for control of the mineral-rich region, displacing 7 million people. The conflict has spread beyond front lines, with civilians facing artillery fire and drone strikes while struggling to access aid.
South African President Cyril Ramaphosa inaugurated a new parliament in Cape Town City Hall on Thursday, following a historic election that led to a multi-party coalition government. The coalition, involving at least 10 parties, aims to address South Africa’s critical issues: unemployment, poverty, and inequality, alongside state institution failures largely attributed to Ramaphosa’s African National Congress (ANC). The May 29 election saw the ANC lose its 30-year majority, prompting Ramaphosa to call for unity across political lines. The new coalition government, labeled the “government of national unity,” prioritizes economic growth, job creation, and anti-corruption measures. Former President Jacob Zuma’s newly founded MK party now leads the opposition.
The International Monetary Fund (IMF) on Wednesday announced a $71 million disbursement to Niger, which is grappling with political instability following a military takeover in July 2023. This decision follows the IMF executive board’s completion of the fourth and fifth reviews of Niger’s Extended Credit Facility (ECF) and the first review of the Resilience and Sustainability Facility (RSF). The total funding under these arrangements now amounts to approximately $255 million. Although program implementation was on track until June 2023, the political crisis disrupted progress, leading to debt service arrears. Niger’s military regime, which ousted President Mohamed Bazoum, has shifted alliances from Western partners to Russia. The political upheaval has also resulted in the formation of the Alliance of Sahel States with Burkina Faso and Mali, severing ties with ECOWAS. Despite these challenges, IMF deputy managing director Antoinette Sayeh noted improved economic prospects due to oil exports, lifted sanctions, and increased agricultural production.
Writer and researcher at Alafarika for Studies and Consultancy.