JOHANNESBURG (Reuters) – Mozambique plans state spending of a third more than budgeted revenue in 2017 and to cover the shortfall with domestic and foreign loans, state news agency AIM quoted Finance Minister Adriano Maleiane as saying on Wednesday.

The country budgeted for a deficit of 11 percent of GDP this year, high by international standards, at a time when it had the financial support of the International Monetary Fund.

But the Fund and other donors suspended assistance earlier this year after the emergence of more than $2 billion in loans that were not approved by parliament or disclosed publicly, sending the metical currency into freefall.

That, and steep declines in commodity prices, have sharply slowed growth in one of Africa’s poorest economies.

Maleiane said next year’s spending would total 272 billion meticais ($3.74 billion).

He pegged state revenue at $2.5 billion, which indicated the deficit would narrow next year. Mozambican economic output totalled $15.6 billion in 2013, according to the latest available World Bank figures.

An IMF official said last month the Fund might agree a new aid programme early next year if the government renegotiated loans with creditors and allowed an independent debt audit. [nL8N1D32D5]

Maleiane said spending on education would account for 23 percent of next year’s budget while infrastructure, which was ravaged by a 16-year civil war that ended in 1992, would cover 18 percent, AIM reported.

Mozambique, a former Portuguese colony, emerged from that war to become one of Africa’s best-performing economies, with annual growth averaging around 8 percent between 1996 and 2008.

Growth is expected to accelerate to 5.5 percent in 2017 from a projected 4.5 percent this year.

($1 = 72.6500 meticais)

(Reporting by Tiisetso Motsoeneng; editing by John Stonestreet)

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ABIDJAN (Reuters) – Ivory Coast will increase the volume of cocoa that can be sold to foreign buyers who have no presence in the country to 400,000 tonnes from 220,000 tonnes, three senior government sources told Reuters on Tuesday.

The state Cocoa and Coffee Council (CCC) will also withhold forward cocoa sales for the 2017/18 crop beyond January if necessary, two sources at the CCC and another at the national treasury said, as it waits for prices to recover.

The CCC also plans to increase the cocoa export contract deposit to 5 percent from 2.5 percent to curb speculation on cocoa prices, the sources said. And it planned to scrap a three-month deadline for exporters to roll forward futures contracts, starting this quarter, the sources said.

(Reporting by Ange Aboa; Writing by Tim Cocks; Editing by Louise Heavens)

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BEIJING/CAIRO (Reuters) – China and Egypt on Tuesday concluded an 18 billion yuan ($2.62 billion) three-year bilateral currency swap, a move that importers and economists said would facilitate trade and improve foreign currency liquidity in cash-strapped Egypt.

Egypt’s central bank, which signed the deal with the People’s Bank of China, said the arrangement could be extended by mutual consent.

“This bilateral currency swap is a mutually beneficial arrangement between both countries,” it said in a statement.

The People’s Bank of China said the move was aimed at promoting trade and investment and maintaining financial stability in both countries.

China has carried out swaps with more than 30 central banks around the world to increase the use of the yuan as a global reserve currency and to stimulate bilateral trade. The yuan is traded onshore against 16 major currencies.

Neither bank gave details on how the Egyptian currency swap would work but economists and businesspeople expect it to have a positive impact on Egypt’s foreign reserve position.

“The position of the central bank is definitely increasing, with more firepower denominated in foreign currency to stabilise the Egyptian pound when needed. So this is definitely something positive,” said Hany Farahat, senior economist at Cairo-based CI Capital.

Egypt has struggled to revive its economy since a popular uprising in 2011 drove away tourists and foreign investors, major sources of foreign currency.

Reserves tumbled from $36 billion in 2011 to around $16.56 billion at the end of last August.

But Egypt has since pressed ahead with a reform programme that has seen it abandon its currency peg, cut subsidies and introduce a value-added tax.

The measures helped Egypt clinch a $12 billion three-year loan from the International Monetary Fund last month. It has already received the first $2.75 billion IMF instalment, helping push foreign reserves above $23 billion in November.

Egyptian importers said the deal with China would allow them to source yuan directly, facilitating imports from China whilst reducing demand for dollars and easing pressure on the Egyptian pound.

They said the deal made sense for China as a Chinese developer will be involved in the construction of a planned new Egyptian capital at a cost of $20 billion and Chinese firms were investing in other sectors in Egypt.

Egypt’s pound has roughly halved in value against the dollar since the central bank abandoned its peg on Nov. 3. The central bank had blamed currency pressures on its large trade deficit.

“I expect the exchange will be done immediately with the full amount, and then the two countries can spend the local currency of the counter-party in whatever way they want. And then, at a later point, after the period of the swap, which is three years, they would exchange it back,” Farahat said. ($1 = 6.8772 Chinese yuan renminbi)

(Reporting by Beijing newsroom and Lin Noueihed and Asma AlSharif in Cairo; Editing by Kevin Liffey and Andrew Heavens)

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NEW DELHI (Reuters) – Nigeria will maintain oil output at 1.9 million barrels per day (bpd) with all three of its main fields on line, the country’s oil minister Emmanuel Ibe Kachikwu said on the sidelines of India’s Petrotech energy conference on Monday.

Nigeria in October said it expected its oil production rate to jump by 22 percent by the year’s end to 2.2 million bpd.

Apart from the impact of low oil prices, whose sales account for 70 percent of the Nigerian government’s revenue, the country’s energy facilities have been crippled by attacks by militants calling for a greater share of the country’s oil wealth.

(Reporting by Promit Mukherjee; Editing by Kenneth Maxwell)

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By Davide Barbuscia

DUBAI (Reuters) – Banque Misr <Banque Misr SAE>, one of Egypt’s biggest lenders by assets, is raising a five-year syndicated loan guaranteed by the country’s central bank, sources close to the situation said.

The bank has mandated ADIB Capital and Credit Suisse to arrange the transaction, which was launched to syndication in the second half of November. ADIB Capital is the investment banking arm of Abu Dhabi Islamic Bank’s Egyptian subsidiary.

The loan, an amortising facility, is expected to be about $350 million and offers a margin of around 500 basis points over the London Interbank Offered Rate (Libor), said one of the banking sources.

Banque Misr officials could not be reached by telephone, and the bank did not reply to an emailed request for comment.

The fact that the loan is guaranteed by the central bank is a positive factor for banks which could participate in the loan, the sources noted, adding however that the proposed five-year maturity was unusual for financial institutions, which generally raised syndicated loans with shorter tenors.

The presence of Credit Suisse as one of the arrangers indicates that the lead banks have the capacity to underwrite and hold a large part of the requested amount, so the deal should not have trouble reaching completion, one of the bankers said.

Banque Misr raised a $250 million, three-year loan in December last year, offering a margin of 290 bps over Libor.

(Editing by Andrew Torchia)

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