IMF approves a $3 billion loan for Ghana
On Wednesday, the International Monetary Fund (IMF) announced that it has approved a three-year extended credit facility of $3 billion for Ghana. This approval allows for an immediate disbursement of approximately $600 million.
The approved loan is intended to provide economic recovery and stability to Ghana amidst the challenges posed by the COVID-19 pandemic and regional geopolitical tensions. The IMF stated that the program will assist Ghana in addressing fiscal and debt vulnerabilities, promoting growth and employment, and enhancing social protection and governance.
Following Zambia, Ghana is the second African country to request debt relief under the Common Framework. The initiative was launched in 2020 to assist low-income countries in managing the effects of the pandemic and other unforeseen challenges. We anticipate that this loan will aid Ghana in addressing its economic challenges, offering potential solutions and support.
FGN completes $1.3 billion Zungeru hydropower project
According to Federal Minister of Power, Abubakar Aliyu, the federal government of Nigeria has successfully completed the Zungeru hydropower project – a $1.3 billion plant expected to generate 700 megawatts of electricity to become the second-largest hydroelectric power project in the country.
The 700-megawatt (MW) Zungeru hydropower plant is estimated to generate 2.64 billion kilowatt-hours (kWh) of electricity a year, which will meet close to 10% of Nigeria’s total domestic energy needs. With approximately 62% of its population lacking access to electricity, Nigeria faces significant energy poverty. Hence initiatives like the Zungeru hydropower project to address the country’s substantial energy deficit are a welcome development.
Nigerian businesses forced to lay off staff due to naira scarcity
According to a report titled “Strapped: Impact of the Cash Scarcity on Individuals and Businesses” by socioeconomic research firm SBM Intelligence, the consequences of the Central Bank of Nigeria’s (CBN) Naira Redesign policy of 2023 have been severe. The report reveals that 36.96% of Nigerian businesses have been forced to lay off employees due to cash shortages and constraints caused by the policy.
Furthermore, the report highlights that 56.52% of the surveyed businesses reported incidents of fraud or theft as a result of cash scarcity. Additionally, a significant 82.61% of business owners faced disruptions in their supply chain.
As the Nigerian economy and businesses strive to recover from these setbacks, the government must implement measures to expedite the recovery process. By implementing supportive policies, the government can help businesses regain stability and facilitate the overall economic recovery in Nigeria.
ICYMI: Market roundup.
The NGX All-Share Index depreciated by 0.05% to close the week 19th of May 2023 at 52,187.93
- The top gainers were FTN Cocoa Processors Plc +37.50%, Ikeja Hotel +30.13%, PZ Cussons Nigeria Plc +28.00%, Livestock Feeds Plc +27.45%, and Cornerstone Insurance Plc +23.08%.
- The top losers were CWG Plc -25.60%, Ardova PLC -23.67%, May & Baker Nig.Plc -10.11%, Honeywell Flour Mills -9.67%, and McNichols Plc -9.33%.
- The naira closed the week at N462.00/1$ on Friday from the N462.50/1$ recorded the previous week.
- Brent crude closed the week at $75.59 while US West Texas Intermediate (WTI) crude closed at $71.55.
- The global cryptocurrency market cap stood at $1.12 Trillion, at 6.50 pm Sunday, the 21st of May, 2023. Bitcoin stood at $26,870.49 (a 0.27% decrease in 7 days), Ethereum stood at $1,805.98 (a 0.02% decrease in 7 days) and Binance coin stood at $308.85 (a 1.27% decrease in 7 days).
- Figorr, a Nigerian cold chain startup, raised USD 1.5 M in seed funding in a round.
- Kenyan-based climate-tech startup Amini has raised $2 million in a pre-seed round to make data accessible on Africa’s environment.
- M-KOPA, the asset financing platform that offers underbanked African customers access to productive assets and the ability to pay for them via digital micropayments, has secured over $250 million in new funding.
- Jia, a blockchain-based fintech providing loans to micro and small businesses in emerging markets, has raised $4.3 million in seed funding, and an additional $1 million commitment for on-chain liquidity.