Business
Outlook of African economies in 2024 signal gradual strengthening – IMF
The International Monetary Fund has stated the outlook of African economies in 2024 provides hopeful signals that economic activity is gradually strengthening with stronger growth, falling inflation, and narrowing fiscal imbalance.
At an African Caucus Meeting, the Managing Director of the IMF, Kristalina Georgieva, said this year has been a difficult year for Africa, but there is hope going forward.
“We had very productive discussions on Africa’s economic prospects. This year has been a difficult year for Africa. The region is still emerging from the Covid-19 pandemic and African countries have been hit by high borrowing costs (“funding squeeze”) and a cost-of-living crisis. Several countries of the Group have experienced increased political instability and deteriorating security underscoring the need to address persistent fragility. Notwithstanding these challenges, recent data, and the outlook for 2024 provide hopeful signals that economic activity is gradually strengthening with stronger growth, falling inflation, and narrowing fiscal imbalance”.
Against this backdrop, the Group agreed that policy priorities to address these challenges should aim at solidifying the ongoing economic recovery, rebuilding buffers, and investing in the future to improve living standards.
In countries with elevated and rising inflation, it wants policy settings to be sufficiently tight to bring it down.
“The exchange rate, where appropriate, should be allowed to play its shock absorber role while mitigating second-round effects of depreciation. Fiscal policy should continue consolidating public finances and reducing debt sustainability risks while providing targeted social assistance to the most vulnerable. In resource-intensive countries, investing in education, managing better resource-based wealth, accelerating diversification will help improve living standards”, it added.
The Group also underscored the need to scale up concessional financing, including to support climate change adaptation and mitigation.
“Large financing needs from infrastructure and social protection gaps are being exacerbated by climate change. While the African continent had a minor contribution to the stocks of greenhouse gases in the atmosphere, it is already bearing and is deemed to bear the largest costs from climate change. At the same time, fiscal space remains constrained as buffers have been depleted during the crisis. Private sector participation will also be essential to fill the funding gaps”.
The Group also agreed to enhance domestic resource mobilization, adding, “In this respect, identifying the international best practices and leveraging specific country experiences is important while enhancing governance and accountability. Efforts to strengthen countries’ tax systems and to combating tax evasion and illicit financial flows should be accelerated”.
The IMF boss her outfit remains actively engaged with the region and continues to work towards strengthening its financing capacity to support countries to navigate challenging times and build a resilient and prosperous future.
COCOBOD has assured that concrete steps have been taken to ensure it is able to secure enough funds to finance its annual cocoa purchases in the 2023/2024 crop season.
Against the backdrop of a reportage by Reuters that the firm had borrowed up to $200 million from cocoa traders to plug its funding gap, COCOBOD said it had adopted a two-prong financing strategy to ensure that it obtained the required funds for the purchasing season.
A statement from COCOBOD in response to the Reuters report indicated that it had had firm assurances from its bankers of making funds available in time for the purchasing season and that a “Cocoa syndicated Loan has been laid in Parliament for consideration and approval.”
Below is COCOBOD’s full statement.
FINANCING OF PURCHASES FOR 2023/24 CROP SEASON
There have been some recent publications in the news media in relation to funds for cocoa purchases for the 2023/24 Crop Season.
We wish to brief our stakeholders on this very sensitive national issue as follows:
COCOBOD planned a two-prong financing for the 2023/2024 Crop Season in an effort to diversify Its source of funding for the annual cocoa purchases.
The strategy was therefore, to use a prefinancing arrangement with the international buyers to raise an amount of US$400 million for purchases at the beginning of the Season in September 2023.
These initial funds were expected to be augmented by an additional US$800 million loan from a syndicate of lenders by the end of November 2023. After engagements with buyers for several weeks, the arrangement was however discontinued.
Thus, since the beginning of the Season, cocoa purchases have been financed with noncollateralized cocoa sales proceeds. COCOBOD is therefore still in the process of securing the syndicated loan for the 2023/24 Crop Season.
As a matter of fact, the Board has so far received firm response from our bankers in this regard, and the Cocoa syndicated Loan has been laid in Parliament for consideration and approval.
We wish to use this medium to assure our stakeholders that the necessary arrangements have been made to secure enough funding for cocoa purchases for the year under review.
ISSUED BY: PUBLIC AFFAIRS DEPARTMENT
Vice President Dr. Mahamudu Bawumia is actively seeking Czech investors for the country.
Dr. Bawumia emphasized that Ghana remains the best country in Africa for investment due to its stability, peace, and growth opportunities for businesses.
He made these remarks during his meeting with the Czech Prime Minister, Peter Fiala, at the Jubilee House in Accra.
“Ghana is an excellent place for doing business. We are the most peaceful country in West Africa and the second most peaceful country in Africa. It is crucial for anyone looking to invest in Africa to consider Ghana as the ideal destination for business.”
“I am confident that this will open up opportunities for our respective business sectors,” he stated.
South Dayi Member of Parliament, Rockson Nelson Dafeamekpor, has said that the ’24-hour Economy’ project conceived by the flagbearer of the National Democratic Congress (NDC) Former President John Dramani Mahama will turn the economy around if implemented.
Mr Mahama proposed the ’24hr Economy ‘ project when he met with officials of the country’s mother workers union on Tuesday, November 7, 2023 at the start of his engagement with key stakeholders in a quest to return to power.
Dubbed ‘Building Ghana Tour’, the interactions with the stakeholders is to apprise them of the policies the next NDC administration will implement to transform the economy.
At Tuesday’s engagement, he said “NDC was left alone as the solitary voice seeking to hold the government accountable and speaking up for the voiceless Ghanaian and we were often cast out as spoilt brats who were ranting just because we have lost power.
“Today, the chickens have come home to roost and we are all affected.”
Commenting on this in a tweet, Mr Dafeamekpor said “Some concrete Examples of John Mahama’s ‘24hr Economy’ Projects include Terminal 3 at Kotoka, Tema Port Container Terminal, New Ridge Hospital, Maritime Hospital, Tema, UGMC, Legon, Kejetia Market, Accra Data Centre, the TamaleTeaching Hospital. It’ll revolutionize the economy.”
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