By Chijioke Ohuocha

ABUJA (Reuters) – Nigeria plans to get out of recession by boosting government revenues and cracking down on corruption, Finance Minister Kemi Adeosun said on Thursday, and will also issue more international debt to pay for infrasturcture projects.

The country is in its second year of recession, brought on by lower oil prices, which have slashed government revenues, weakened the currency and caused dollar shortages frustrating business and households.

World Bank chief economist for Africa, Albert Zeufack, on Wednesday said fiscal adjustments in Nigeria would be “extremely challenging” and that the country needs to reform its finances to ensure it can hedge against any future currency crisis.

Nigeria also ranks well into the bottom third of Transparency International’s global corruption index. On Wednesday, for example, more than $43 million found in an apartment complex in Lagos was said to be related to an investigation into the handling of humanitarian aid.

Adeosun said her aim was to get the non-oil sector of Nigeria’s economy which accounts for around 90 percent of GDP to contribute to government revenues.

“Improving non-oil revenues is something we are working hard on. We are rolling out measures to get more people into the tax net,” Adeosun told CNBC Television.

“We are get out of recession because we are following the right type of policies. We are improving our revenues, we are improving our efficiencies in how we spend money.

“We are investing in the infrastructure that is needed, power, rail, road, the big enablers of growing sustainable economies.”

Adeosun said liquidity on currency markets has been improving as the central bank has boosted dollar supply, thanks to recently rising oil prices. She added that government was harmonising fiscal, monetary and trade policies to get the economy growing again.

However, the central bank, worried about the currency effects on inflation, has so far resisted calls to lower interest rates for 14 percent to enable the government borrow cheaply to spend its way out of recession.

Adeosun said Nigeria plans to issue long-term debt on the international markets more regularly for infrastructure projects, taking advantage of the country’s debt to GDP ratio of 13 percent. But the interest burden is rising due to low revenues.

(Editing by Jeremy Gaunt)

Read more

NAIROBI (Reuters) – Economic growth in sub-Saharan Africa is seen rising between this year and 2019, helped by better commodity prices and improved global conditions, the World Bank said in a report on Wednesday.

The bank said in its latest “Africa’s Pulse” report economic growth was seen expanding to 2.6 percent this year and further to 3.2 percent in 2018 and 3.5 percent a year later.

Sub-Saharan African growth was an estimated 1.3 percent in 2016, the World Bank said.

“The upturn in economic activity is expected to continue in 2018-19, reflecting improvements in commodity prices, a pickup in global growth, and more supportive domestic conditions,” the bank said in its report.

The bank said the 2016 growth was the worst for the region in more than two decades, hurt by poor performance in Nigeria, South Africa and Angola.

“This low growth rate was driven mainly by unfavourable

external developments, with commodity prices remaining low, and difficult domestic conditions,” the report said.

It said growth in Nigeria contracted by 1.5 percent, due to tight liquidity, delays in implementing its budget, and militant attacks on oil pipelines.

The bank said Angola’s growth slowed due to a fall in oil production while South Africa’s economic expansion slowed to 0.3 percent due to contractions in the mining and manufacturing industries and the effects of drought on agriculture.

“Excluding these three countries, growth in the region was estimated to be 4.1 percent in 2016,” the report said.

(Reporting by George Obulutsa; editing by John Stonestreet and Pritha Sarkar)

Read more

TUNIS (Reuters) – Tunisia’s central bank will reduce its interventions so the value of the dinar steadily declines, but it will prevent a dramatic slide in the currency, the finance minister said on Tuesday.

The strategy is part of Tunisia’s talks on reforms with the International Monetary Fund. The IMF is pushing Tunisia to overhaul its finances and reduce public spending, especially public-sector wages, where spending is among the highest in the world compared with gross domestic product.

Part of those negotiations have been finding ways to encourage exports and reduce reliance on imports, a strategy which would benefit from a weaker dinar.

“The central bank is going to minimise its interventions to reduce the value of the dinar in a gradual slide of the dinar,” Finance Minister Lamia Zribi told local Express FM Radio. “But we will avoid a brutal devaluation like that in Egypt.”

The dinar reached 2.5 dinars to the euro on Monday.

Egypt floated its currency, the pound, last year, letting it fall by 32.3 percent.

The IMF on Monday agreed to release a delayed $320 million tranche of Tunisia’s $2.8 billion in loans. It had been held up by concerns over Tunisia’s lack of progress in its reforms.

The agreement to release the funds came after talks in Tunis that included setting priorities for progress in the reforms. Those include increasing tax revenue, reducing the public wage bill through civil-service reforms and reducing energy subsidies, according to an IMF statement.

The IMF also called for tighter monetary policy that would counteract inflationary pressures, and said “greater exchange rate flexibility would help narrow the large trade deficit.”

The finance minister said the reforms on public works may include early retirement, reforms to loss-making public companies and social funds.

“For our part we are willing to advance the reforms and avoid the painful reforms such as lifting subsidies completely,” she said.

Tunisia has been held up by as an example of a democratic transition since the overthrow of former President Zine El-Abidine Ben Ali in 2011. It has enacted a new constitution, held free elections and adopted compromise-style politics to overcome tensions between secular and Islamist leaders.

But economic reforms have lagged and many people are concerned about the cost of living, unemployment and rural marginalisation, especially in southern and central regions that were the heartland of the 2011 uprising.

($1 = 2.3148 Tunisian dinars)

(Reporting by Tarek Amara; Writing by Patrick Markey)

Read more

RABAT (Reuters) – Morocco plans to start the first stage of liberalising its dirham currency in the second quarter of this year, though the process to full flexibility may take 15 years, the central bank governor said on Tuesday.

“We will begin the first phase of liberalising the dirham in the second quarter,” Governor Abdellatif Jouahri told Reuters at an Arab finance ministers meeting in Rabat. “I can’t tell how long the duration of each phase will take, it depends on the market.”

(Reporting by Samia Errazzouki; writing by Patrick Markey)

Read more

By Tarek Amara

TUNIS (Reuters) – Tunisia’s economy will start to regain momentum this year after six years of slow growth, driven by the revival of the vital tourism industry and the return to state phosphate production, Prime Minister Youssef Chahed said.

Chahed was speaking in an interview with state television late on Sunday, addressing concerns about the economy after hundreds of youths protested over the last week in some towns, demanding development and employment.

Tunisia has been praised as an example of democratic transition since the overthrow of former President Zine El-Abidine Ben Ali in 2011. But many people are concerned about the cost of living, unemployment and the marginalisation of rural towns – factors that fueled the uprising that sparked the Arab Spring revolts.

“The tourism sector is better now and will grow by 30 percent this year. Phosphate production returned to old levels and we expect a good agricultural season,” Chahed said.

He said that tax revenues rose by 14 percent in the first quarter of this year.

The prime minister said that this upward trend was still fragile and threatened by the inflammatory discourse of some politicians and by random strikes and protests that have hurt investor interest in the country.

Tunisia expects economic growth to rise to 2.5 percent in 2017 after failing to exceed 1 percent for the last six years.

The government is under pressure from international lenders to reduce public spending and cut its deficit as part of economic and financial reforms that have been delayed for years by political infighting and inertia.

A delegation from the International Monetary Fund last week arrived in Tunisia for talks on accelerating the North African country’s economic reforms, after postponing the payment of a second tranche of aid worth $350 million, out of a $2.8 billion loan programme.

The IMF put back the payment scheduled last December citing a lack of progress in overhauling the public sector wage bill, public finances and state banks among other issues.

Chahed said talks with the multinational lender “look positive and I am optimistic after negotiations” because reforms were progressing according to a specific timetable in the public sector and social funds.

“We are in good shape for these reforms and we are the first government that has the courage to start these delicate reforms that have been stalled for years,” he said, without giving details.

Tunisia is expected to sell stakes in three state-owned banks and cut up to 10,000 public sector jobs.

Chahed said parliament will discuss this month “an economic emergency” bill that will allow the government to bypass bureaucratic hurdles and speed up large-scale projects as it seeks to boost growth and create jobs.

(Editing by Patrick Markey and Hugh Lawson)

Read more