By Felix Onuah

ABUJA (Reuters) – Nigerian lawmakers aim to pass the 2017 budget by the end of March, the president of the upper house of parliament said on Tuesday, following a meeting with President Muhammadu Buhari.

The budget lays out plans to pull Africa’s largest economy out of its first recession for 25 years, largely prompted by low global prices for the oil it produces and by attacks on energy facilities in the OPEC member’s Niger Delta oil hub last year.

Buhari, a 74-year-old former military ruler who has faced rising disenchantment over his handling of Nigeria’s economy, presented his record 7.298 trillion naira ($23.21 billion) budget to lawmakers in December.

“This month is our deadline to finish work on the budget and return it to the executive,” Senate President Bukola Saraki said after the meeting with Buhari and the head of parliament’s lower house. “We are working very hard to ensure we meet that deadline.”

The budget must be agreed by lawmakers before the president can sign it into law.

The 2016 budget became law in May last year after being delayed by several weeks of wrangling between the government and the Senate.

Saraki said he had also briefed Buhari at their meeting on the activities of parliament during the president’s lengthy absence due to illness.

Buhari resumed his presidential duties on Monday after spending seven weeks in Britain on medical leave for an undisclosed ailment.

Saraki said the issues discussed with Buhari had included “stability in the Niger Delta” and the $1 billion Eurobond issued by Nigeria last month.

Vice President Yemi Osinbajo drove policy implementation in Nigeria, Africa’s most populous nation, during Buhari’s absence.

($1 = 314.5000 naira)

(Writing by Alexis Akwagyiram; Editing by Gareth Jones)

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JOHANNESBURG (Reuters) – S&P Global Ratings reiterated its concerns on Tuesday about weak economic growth, political tensions and policy reform in South Africa, which faces the prospect of downgrades to its sovereign credit ratings which would raise the cost of borrowing.

The political temperature has been rising in Africa’s most industrialised economy ahead of the ruling African National Congress (ANC) party’s key policy and leadership conferences this year, to chart the country’s economic and political course. A successor to President Jacob Zuma as head of the party is due to be elected at the ANC’s conference in December.

“If we see a lot increasing political tensions, infighting in state institutions which could derail the government’s plans in boosting economic growth then that can impact on our forecasts on growth,” Gardner Rusike, S&P associate director told a conference.

S&P has cited “political turmoil and tension” before and the issue clearly remains high on the investment radar screen.

Growth has also been a persistent concern. South Africa’s economy grew by 0.3 percent in 2016 versus 1.3 percent in 2015, well short of the government’s target of 5 percent.

(Reporting by Olivia Kumwenda-Mtambo; Writing by Ed Stoddard; Editing by James Macharia)

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By Camillus Eboh and Chijioke Ohuocha

ABUJA/LAGOS (Reuters) – Nigeria’s telecoms regulator and central bank governor intervened on Thursday to try and help Etisalat Nigeria resolve debt restructuring talks with its lenders, after the company missed a payment on a $1.2 billion loan.

A banking source told Reuters on Wednesday that the Nigerian affiliate of Abu Dhabi-listed telecoms company Etisalat, had given notice to its Nigerian lenders that it would miss a payment in February. Debt talks were triggered 10 days ago but the two sides have not been able to agree on terms.

One of the lenders, Access Bank said on Thursday that it was owed 40 billion naira ($131 million) by Etisalat Nigeria.

The consortium of 13 banks had asked Etisalat to convert loans from its parent into equity and inject fresh capital into its Nigerian unit.

The Nigerian Communications Commission (NCC) said in a statement that it was worried about the negative impact the issue could have on Eitisalat subscribers and the industry, and wanted to prevent a possible takeover of Etisalat by the banks.

NCC Chairman Umar Danbatta met with central bank Governor Godwin Emefiele to try and find a solution and ordered Etisalat Nigeria and the banks to meet again on Friday. It gave no details.

“NCC was worried about the fate of the over 20 million Etisalat subscribers and the wrong signals this may send to potential investors in the telecom industry,” it said in the statement.

LEASE PAYMENT AT RISK

Emirates Telecommunications Group (Etisalat) owns a 40 percent stake in its Nigerian affiliate, which accounted for around 3.7 percent of the group’s revenue in 2013.

Etisalat Nigeria signed a $1.2 billion medium-term facility with 13 Nigerian banks in 2013, which it used to refinance an existing $650 million loan and fund a modernisation of its network.

Banks involved in the loan deal include: Zenith Bank , GT Bank, First Bank, UBA, Fidelity Bank, Access Bank, Ecobank, FCMB, Stanbic IBTC Bank and Union Bank.

Access Bank’s Chief Executive Herbert Wigwe told an analysts’ call on Thursday that Etisalat had converted a shareholder loan to the Nigerian arm to equity to free up cashflows and that it may need to bring in fresh equity.

As well as the loan from banks, Etisalat also entered into a sale and lease-back of its phone towers with tower firm IHS Nigeria to free up cash. Analysts worry that IHS, which has Etisalat as its second-biggest customer, may be affected too.

JP Morgan analyst Zafar Nazim said in a note on Thursday that on Wednesday it downgraded IHS bonds due 2021 because of Etisalat Nigeria as it was uncertain whether the company could keep up with lease commitments.

Nazim also said it was unclear whether Etisalat’s parent firm would recapitalize the Nigerian operations given its small market share in the country, but added that a quick resolution to the loan issue would boost IHS bonds.

(Additional reporting by Andrew Torchia in Dubai; Writing by Chijioke Ohuocha and Ulf Laessing; Editing by Mark Potter and Susan Fenton)

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CAIRO (Reuters) – Egypt’s annual urban consumer price inflation soared to its highest level in more than three decades, hitting 30.2 percent in February, the statistics agency CAPMAS said on Thursday.

It was the fourth consecutive jump in inflation since the central bank abandoned its currency peg to the U.S. dollar on Nov. 3 in a dramatic move that has since seen the currency depreciate roughly by half.

Urban consumer price inflation had reached 28.1 percent in January year-on-year. The February number is the highest level since November 1986, when it reached 30.6 percent, according to Reuters data. (for chart click on http://reut.rs/2mExYx8)

Monthly urban consumer inflation eased to 2.6 percent in February from 4.07 percent in January.

The central bank accompanied the float with a 3 percent interest rate hike to fight price pressures but inflation has jumped over the past four months and is expected to climb further this year as the government pushes on with economic reforms, including fuel subsidy cuts.

“We expect headline inflation to remain elevated at similar and higher levels until Q4 2017, at least, as the pass-through effect from the higher FX rate continues, albeit at lower levels,” said Reham ElDesoki, senior economist at Arqaam Securities.

The economic reforms helped Egypt secure a $12 billion loan programme from the International Monetary Fund in November.

President Abdel Fattah al-Sisi is under increasing pressure to revive the economy, keep prices under control and create jobs to avoid a backlash from the public.

On Tuesday hundreds of Egyptians protested around the country, blocking roads and surrounding government offices, after a change to the way bread rations are managed raised fears that the government was cutting food subsidies by the back door.

In cities and towns food and beverage inflation reached 40.5 percent year on year in February. Clothing and footwear inflation reached 23.4 percent while transport inflation reached 28.8 percent annually, the statistics agency said.

“The prices are very expensive, nothing is getting cheap. People are buying much less, instead of 2 kilos, they get 1.5, tightening the belt until things get better,” Abdullah Mohsen, a vegetable seller at a market in Cairo on Thursday.

“Traders have hiked up the prices of the vegetables we buy in bulk, and it’s unimaginable. I’ve never heard of aubergines or beans selling for these prices,” he added.

Some economists expect the rising inflation to erode spending power, hit economic growth and prompt further hikes to interest rates, which are already up to 15.75 percent.

Egypt’s central bank has held interest rates steady at three monetary policy meetings since the flotation and some economists expect further rate hikes this year. The central bank’s monetary policy committee is due to meet on March 30 to decide on its key rates.

IMF mission chief for Egypt Chris Jarvis said in January the fund expects inflation to begin dropping sharply by the second quarter of 2017.

(Reporting by Asma Alsharif, additional reporting by Nadine Awadalla; Editing by Richard Borsuk and Toby Chopra)

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