The Editorial Team

Commodity Shipping Rates Are Surging and Rally Isn’t Over

LAGOS (Capital Markets in Africa) — For a glimpse of how quickly and unevenly economies are recovering from the pandemic, look no further than the market for shippingraw materials. Rising demand for everything from soybeans to steel has sent the cost of hauling dry goods soaring more than 50% this year. Manufacturing, which first picked up in China, is now accelerating elsewhere, and countries are stepping up commodity purchases to rebuild stockpiles after running them…

The Gig Economy’s Political Reckoning Has Arrived: QuickTake

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LAGOS (Capital Markets in Africa) — In the gig economy, who’s the boss? Gig work refers to jobs done by workers who aren’t employees, at least according to the companies they work for. The term is most often used to describe people deployed for piecemeal tasks through smartphone apps created by tech startups, such as Uber Technologies Inc.’s ride-hail and delivery drivers. Such arrangements are a linchpin of the field that used to be called…

Energy Sector Debt Is a Key Risk to Ghana’s Post-Pandemic Debt Trajectory

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ACCRA (Capital Markets in Africa) – Stable Outlook but Risks to Public Finances Fitch Ratings expects that Ghana’s general government debt will continue to rise in 2021 and 2022 due to high pandemic-related spending and the realisation of energy sector liabilities. In our base case, we expect debt to plateau at about 75% of GDP from 2024. Fitch affirmed Ghana’s sovereign rating (B/Stable) in October 2020, on an expectation of a gradual recovery, both in…

Callable Capital Rise Highlights AfDB’s Shareholder Support

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LONDON (Capital Markets in Africa): The African Development Bank’s (AfDB) temporary callable capital increase of XDR28.6 billion (to XDR180.6 billion) should ensure the bank’s net debt will remain fully covered by ‘AAA’ callable capital – the key metric underpinning the bank’s ‘AAA’ rating – even in the case of a US (AAA/Negative) downgrade, Fitch Ratings believes. After the 2019 General Capital Increase (GCI-VII), which raised the bank’s capital by 125%, the new capital increase approved…

Egyptian Banks Face Further Pressure from Coronavirus Fallout

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Fitch Ratings-London/Dubai-07 April 2021: Egyptian banks face asset-quality deterioration and continued pressure on profitability through 2021 amid the economic fallout of the pandemic, Fitch Ratings says in a new report. Capitalisation remains a credit weakness and foreign-currency liquidity is still vulnerable to external shocks. However, the sector could benefit from growth and revenue opportunities, with Egypt’s lockdowns less stringent than those in many jurisdictions, and consumer consumption and public investment more resilient. The sector average…

IMF Lifts Global Growth Forecast, Warns of Diverging Rebound

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LAGOS (Capital Markets in Africa) — The International Monetary Fund upgraded its global economic growth forecast for the second time in three months, while warning about widening inequality and a divergence between advanced and lesser-developed economies. The global economy will expand 6% this year, up from the 5.5% pace estimated in January, the IMF said in its World Economic Outlook published on Tuesday. That would be the most in four decades of data, coming after…

Investors Closer to Getting a Credit-Based Alternative to Libor

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LONDON (Capital Markets in Africa) — Global regulators’ approval of a U.S. dollar-denominated rate that assesses market credit risk is growing nearer as the beleaguered London interbank offered rate is set to be phased out, allowing financial service firms to fill the void with new benchmarks. Bloomberg’s Short-Term Bank Yield Index, or BSBY, adheres to the International Organization of Securities Commissions’ Principles for Financial Benchmarks, based on an independent assurance review, Bloomberg LP said in…

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