Africa Brief:Tough budget for president, Climate shift will hit Africa hard and more…
Tough budget for president
Nigeria’s president faces a daunting task when he presents next year’s budget tomorrow; with tighter spending likely to be shot down the legislators keen to keep the wheels of patronage turning ahead of elections in 2015. Economists have praised Finance Minister Ngozi Okonjo-Iweala’s efforts to slash spending in the budget framework paper, which allocated outgoings of 4.5 trillion naira (R285 billion) for 2014, against 5 trillion naira in 2013. But they wonder how she will push it through in the run-up to presidential and parliamentary elections in 2015, as polls invariably trigger fiscal slippage in Africa’s top oil producer. Legislators have indicated they want to increase spending in the budget that President Goodluck Jonathan will present.
For the full story, read Tough budget for president by Reuters published by The Star Business Report on 18/11/2013
African oil lifts luxury house prices
Estate agents are reporting a resurgence of foreigners buying second homes and investment properties in SA this year, with a particularly strong uptick in inter¬est from oil-rich African countries such as Angola, Ghana, Nigeria, Uganda, Gabon and Kenya. Speaking at an annual media event in Cape Town last week, Pam Golding Property group CE Andrew Golding said international buyers have returned to SA’s housing market, which he believes is one of the reasons for the hefty 60% annualised increase in the value of top-end sales above RlOm recorded by the company for the year to date. That com¬pares to a 21% increase in overall group sales over the same time.The weaker rand, which has made South African property around.30% cheaper in US dollar terms over the past 18 months, SA’s value proposition compared to other global investment hot spots, and improved investor sentiment are key drivers of the re-emergence of international buyers, said Mr Golding.Although foreign buying is not yet back to pre-crisis peaks of about 10% of Pam Golding’s total sales value, sales to offshore buyers are touching 8%, up from less than 1% at the bottom of the market in 2008-09.
For the full story read, African oil lifts luxury house prices by Staff Writer, published by Business Day on 19/11/2013
Climate shift will hit Africa hard
The African continent will need between $200bn and $350bn a year by 2070 to shore up its defenses against climate change, a United Nations (UN) report said yesterday. The $200bn figure is a best-case scenario, based on meeting the goal of limiting average global warming to 2°C, the UN Environment Programme (Unep) report said. It was issued on the sidelines of UN climate talks in Warsaw that are working towards sealing a global deal by 2015 to reach the TC target. The higher figure of $350bn assumes warming of 3.5°C-4°C, which will cause much greater damage to Earth’s climate system. The costs of adapting Africa’s infrastructure to the rising seas and stronger storms caused by global warming are likely to total between $7bn and $15bn by 2020 and “rise rapidly” thereafter because of ever-higher temperatures, Unep said yesterday.
For the full story, read Climate shift will hit Africa hard by Sapa-AFP, published by Business Day on 20/11/2013
PPC’s African expansion strategy gains momentum
PPC’S strategy to expand into the rest of Africa has gained significant momentum and the listed cement and lime producer is hopeful about announcing a fifth project on the continent in the first quarter of next year. Ketso Gordhan, PPC’s chief executive, said yesterday that it would have three new plants under construction by the end of the first quarter next year in the Democratic Republic of Congo (DRC), Ethiopia and Zimbabwe, while its plant in Rwanda would come on stream in September next year. The country earmarked for the fifth project was not disclosed. Gordhan said PPC’s capital expenditure budget for the cur¬rent financial year was about R2.7 billion. This included between R500 million and R600m maintenance capital expenditure to keep its South African plants in good shape; between R600m and R700m for its second payment to Cimerwa in Rwanda; the first significant payment in the DRC of R800m; and be¬tween R200m and R300m for the company’s projects in Zimbabwe and Mozambique.
For the full story read, PPC’s African expansion strategy gains momentum by Roy Cokayne published by The Star Business Report on 20/11/2013.
Zambia’s child grants improve life for families
In rural Africa, where money is scarce and subsistence farming the norm, even small injections of cash can go far and help grow a local economy in surprising ways. These are among the findings of a study by the Washington-based American Institutes for Research (AIR), which over a two-year period analysed Zambia’s monthly child grants to extremely poor households in three rural districts. A simulation model used by the researchers found that each Zambian kwacha (R1.83) transferred to poor households raised, through multiplier effects, the income in the local economy by 1.79 kwacha. This suggests that such transfers not only alleviate poverty but also stimulate economic activity – though of course on a small scale and from a very low base
For the full story, read Zambia’s child grants improve life for families by Ed Stoddard, published by The Star Business Report on 20/11/2013
Namibian drought hits uranium mines
Uranium mines operated by companies including Rio Tinto and Paladin Energy in Namibia face a water shortage as a drought in the country curbs supply to operations as well as three coastal towns.Volumes from the Omaruru Delta aquifer, about 200krn northwest of the capital, Windhoek, had declined to 4 million cubic metres this year from 9 million cubic metres a year earlier, said Nehemia Abraham, the undersecretary for water and forestry in the Department of Agriculture.
For the full story read, Namibian drought hits uranium mines by Felix Njini, published by The Star, Business Report on 20/11/2013
Egypt’s gas exports to halve as usage rises
Egypt’s natural gas exports are set to drop by about half this year, undermining the military led-government’s at¬tempts to stabilise the largest economy in north Africa. Eni and BG Group, interna¬tional oil companies with in¬vestments in Egyptian export terminals, said a policy that encouraged gas consumption at home, capped prices and had left the state owing $6 billion (R60.8bn) to producers, was holding back investment in new fields. Egypt is set to fall behind Equatorial Guinea to fourth place among Africa’s gas ex¬porters this year, according to data compiled by Bloomberg. The dilemma for Egypt’s new leaders is that the coun¬try’s thirst for cheap gas leaves little scope to pare back subsi¬dies that cost 7.3 percent of gross domestic product. While the state was starting to repay the debt owed to gas producers, the country would find it hard to win new investment into its country’s largest export indus¬try until price limits were raised, Eni chief executive Paolo Scaroni said in an inter¬view this week.
For the full story read, Egypt’s gas exports to halve as usage rises by Eduard Gismatullin, Published by The Star, Business Report on 20/11/2013
CHINA : Mining windfall tax bill returns
Ghana planned to reintroduce a mining windfall tax bill after consultations, Finance Minister Seth Terkper said yesterday as part of the annual budget speech. “A committee is reviewing all stability agreements, incentives and the windfall profit tax that could not be passed in 2012… In due course, government will re-introduce the bill in parliament after completion of the consultations with all stakeholders,” Terkper said. A previous bill that sought to impose a 10 percent tax on windfall profits was introduced in 2012 but it was not considered by parliament, Terkper said.
For the Full Story Read, CHINA : Mining windfall tax bill returns, by Reuters Published by The Star Business Report on 20/11/2013