6th March 2024
Good morning. South Africa narrowly avoids recession, Sibanye Stillwater reports a staggering $2 billion loss, Africa's wealthiest individual unveils plans to establish an oil trading arm and the Southern African Power Pool (SAPP) launches a $1.3 billion fund. Here’s you Roosters Crow:
South Africa Dodges Recession
South Africa's GDP inches up by 0.1% in Q4 2023, narrowly avoiding recession, with full-year growth at 0.6%. However, it falls short of economist predictions, underlining persistent challenges. Inefficiencies in state-owned entities like Eskom and Transnet, alongside a cost-of-living crisis, continue to hamper growth. The data precedes critical national elections in May, with South Africa facing a decade of economic stagnation, averaging 0.8% GDP growth since 2012, raising concerns of a technical recession.
$2 Billion Loss for Sibanye Stillwater
Sibanye Stillwater reveals a staggering $2 billion annual loss, suspending dividends due to plummeting platinum group metal (PGM) prices, prompting restructuring and job cuts in South African mining. CEO Neal Froneman hints at a potential capital raise amid lower metal prices but dismisses the idea of a rights issue. The losses follow Sibanye's global acquisition spree of battery metal assets, with further restructuring anticipated, echoing industry peers' cost-cutting measures.
Dangote Plans Oil Trading Arm for Mega-Refinery and Binance Halts Naira Services
Africa's richest individual, Aliko Dangote, sets sights on establishing an oil trading venture, possibly in London, to manage supplies for his Nigerian refinery, marking a significant shift in global oil dynamics. Meanwhile, Binance halts Nigerian naira services amidst a legal clash with Nigeria, with users' balances to be converted to Tether. The Nigerian government's demand for $10 billion from Binance for alleged currency manipulation exacerbates the country's economic challenges.
SAPP Launches $1.3 Billion Fund to Bolster Regional Power Grid
The Southern African Power Pool (SAPP) collaborates with Climate Fund Managers to launch a $1.3 billion fund, aimed at constructing crucial high-voltage transmission lines across the region. Initial commitments from SAPP total $20 million, targeting $500 million by 2025. With eight priority projects identified, including the Angola-Namibia interconnector, the fund addresses the lack of connectivity hindering Africa's renewable energy drive, attracting both public and private investors.
