9th January 2024
Nigeria’s $2billion settlement
Nigeria's central bank has disbursed nearly $2 billion in the past three months to settle outstanding forex forwards, aiming to clear a backlog and boost confidence in the foreign exchange market. The country, facing forex shortages exacerbated by declining oil production, has nearly $7 billion in matured forex forwards, concerning investors. The Central Bank of Nigeria (CBN) also recently paid $61.64 million to foreign airlines owed over $700 million, signaling efforts to address outstanding transactions and alleviate pressure on the exchange rate. President Bola Tinubu pledges to attract new investment and reform the forex market to enhance foreign currency inflows.
Dangote probe continues
Dangote Group, led by Africas richest man Aliko Dangote, criticized a recent visit by Nigeria’s anti-graft commission to its Lagos offices, calling it an attempt to cause unwarranted embarrassment. The group clarified that no accusations of wrongdoing were made against them in connection to the probe of Nigeria’s central bank. The investigation, part of a broader inquiry into former central bank head Godwin Emefiele's tenure, was initiated by President Bola Tinubu. Emefiele faces allegations of manipulating the naira and establishing numerous unauthorized offshore accounts. Meanwhile, Nigerian stocks reached a record high, surpassing 80,000 points for the first time, driven by a fifth consecutive session of gains. The All Share Index closed at 80,328.58 points, up 0.83%.
Zimbabwe's Dollar Dips
The Zimbabwean dollar, has faced a sharp decline of over 40% on the black market at the start of the year due to heightened demand for foreign exchange, surpassing available supply. The conclusion of tobacco sales and a dip in global commodity prices have impacted local dollar inflows, causing the exchange rate to plummet. Zimbabwe, reliant on mining for 85% of its foreign exchange, faces challenges in stabilizing its currency. The local unit is now trading at Z$10,900 per US dollar, significantly lower than the official rate of Z$6,467. Authorities aim to restore equilibrium amid the widening gap.
Zimbabwe's Golden Challenge
Zimbabwe's 2023 gold production reached 30 metric tons, a 15% decline from the previous year, attributed to electricity cuts and currency instability. Once a leading African gold producer, Zimbabwe has lagged behind due to economic challenges, deterring investors. Despite a recovery from the 2008 crisis, the 2023 output fell short of the government's 40-ton target. Gold producers, continue to grapple with a depreciating local currency, power cuts and operational challenges in a sector dominated by small-scale miners.
