ABUJA (Reuters) – Nigeria is targeting economic growth of at least 7 percent a year by 2020, the Ministry of Budget and National Planning said on Tuesday, a far cry from its current recession, the first in 25 years.

Nigeria’s economy is heavily dependent on exports of crude oil and is undermined by decades of endemic corruption, It has been hobbled by low global oil prices that have slashed government revenues and the availability of foreign currency.

In the third quarter of 2016, gross domestic product contracted 2.24 percent from a year earlier.

With inflation also at an 11-year high, frustration is rising, with protesters taking to the streets of Lagos on Monday to call for a change in government.

The 7 percent target for gross domestic product growth is part of a medium-term economic recovery plan that seeks to address some of Nigeria’s issues, the budget ministry said in a statement.

“Our goal is to have an economy with low inflation, stable exchange rates, and a diversified and inclusive growth,” Minister of Budget and National Planning Udoma Udo Udoma said at an economic forum on Monday, where he addressed private enterprise, according to the statement.

The plan’s priorities are agriculture and food security, energy, small businesses and industrialisation and stabilising the macroeconomic environment, the minister said.

“Nigerian growth faces various supply constraints including fuel, power, foreign exchange, and even business unfriendly regulation,” the statement said, adding that the recovery plan would seek to address these issues.

(Reporting by Camillus Eboh; Writing by Paul Carsten; Editing by Dominic Evans)

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GABORONE (Reuters) – Botswana’s economy will grow by nearly double in 2017 compared to the previous year as Africa’s largest exporter of diamonds shakes off a slump in global commodity prices and electricity shortages.

In a budget speech to parliament on Monday, Finance Minister Kenneth Matambo said the economy would grow by an estimated 4.2 percent in 2017 compared with 2.9 percent growth in 2016.

However, the minister said the budget deficit would widen, to 1.43 percent of GDP from 0.7 previously, as government spent more on electricity and water infrastructure following a severe drought in the region.

“The optimistic outlook is based on the anticipated slight improvement in the mining sector and positive growth prospects for the non-mining sectors,” Matambo said.

The minister said revenues for the 2017/18 financial year were estimated at 57.2 billion pula ($5.5 billion), with customs collections accounting for 29.8 percent of revenues followed by minerals at 28.6 percent.

Matambo warned that slow recovery in the global economy and low commodity prices posed risks to the growth forecast.

An analyst at First National Bank Botswana, Moatlhodi Sebabole, said the investments in water and energy infrastructure were a positive step.

“The rise in expenditure is enough to support the growth projections but the key will be implementation of these projects,” Sebabole said.

Botswana, which celebrated 50 years of independence in 2016, is considered one of the continent’s most stable nations and boasts one of the highest rates of income per capita in the world.

The land-locked state has, however, struggled with weaker growth in recent times as mineral sales slowed, while electricity shortages have hurt mining.

($1 = 10.5042 pulas)

(Reporting by Johannesburg newsroom; Editing by James Macharia)

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By Wendell Roelf

CAPE TOWN (Reuters) – South Africa will publish its revised Mining Charter by next month, a minister said on Monday, bringing closer legislation meant to redress racial economic inequality but which has concerned companies struggling with lower commodity prices.

A separate Mineral and Petroleum Resources Development Act will be finalised by June, proposing to give the state a 20 percent free stake in new energy projects and the ability to buy further shares.

The Mining Charter was introduced in 2002 to increase black ownership of the mining industry, which accounts for around 7 percent of South Africa’s economic output.

However, industry body the Chamber of Mines, has taken the government to court over ownership interpretations in the latest draft, which requires companies to keep black ownership at 26 percent even if black shareholders sell their stakes.

“We are not challenging the charter. We are fully supportive of the entire transformation journey, but we just need the rules to be absolutely clear to make sure we don’t end up making targets that are unobtainable but are pragmatic and realistic,” said Roger Baxter, chief executive of the Chamber of Mines.

In a separate court case, a local law firm is challenging the entire Mining Charter, arguing it is unconstitutional.

The new charter, which was revised in 2010 as part of a consultative approach to regulations, also requires companies to provide housing and other amenities in mining communities, many of which are mired in poverty and neglect.

“If government goes ahead and implements the charter in its current form it will be very unfortunate, because it would have a pretty dramatic effect on investment in mining in South Africa,” said Peter Leon, a partner at law firm Herbert Smith Freehills African practice.

South Africa is the world’s top platinum producer and has a significant gold industry but firms are struggling with depressed prices, rising costs and bouts of labour unrest.

“For investors, it goes without saying that regulatory certainty and the sanctity of private ownership under the constitution is paramount,” Anglo American Chief Executive Mark Cutifani told delegates at a mining summit in Cape Town.

Mining companies say they were not consulted in the latest draft but Minister of Mineral Resources Mosebenzi Zwane denied this and sought to reassure investors.

“We have consulted extensively with stakeholders,” Zwane said in a speech at the opening of the summit.

“We call upon investors to come to South Africa and engage us frankly as we move towards transformation of our economy. We will continue to have an open door policy.”

With rising unemployment, the ruling African National Congress is under increasing pressure to address gaping inequality that persists 23 years after the end of apartheid.

Black South Africans make up 80 percent of the 54 million population, yet most of the economy in terms of ownership of land and companies remains in the hands of white people, who account for around 8 percent of the population.

(Additional reporting by Zandi Shabalala, Ed Stoddard and Barbara Lewis; Writing by Joe Brock; Editing by James Macharia and Susan Thomas)

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By Tarek Amara

TUNIS (Reuters) – Tunisia needs around $2.85 billion in external financing this year and plans to issue a Sukuk Islamic bond worth around $500 million to help cover the deficit, Finance Minister Lamia Zribi told Reuters on Monday.

Zribi also confirmed a Reuters report that Tunis plans to sell 1 billion euros’ worth of Eurobonds and hold a roadshow on Feb. 5. More Eurobond issues later in the year are possible depending on how the country’s external financing needs are covered, she said.

“After a delay of a few years, our plan this year is to issue $500 million to diversify our resources and cover the deficit of 2017,” Zribi told Reuters on the sidelines of a government development presentation, referring to the sukuk issue.

It is the first time the government has given details of the sukuk issue plan.

“We are going with 1 billion euros in the European market, and we will start with the roadshow on Feb. 5,” the minister said, confirming earlier reports on the initial Eurobond plan.

“If we don’t manage to fulfill our external financing needs of 6.5 billion dinars ($2.85 billion) then without a doubt we’ll go to capital markets again this year.”

Since its 2011 uprising that led to a transition to democracy, Tunisia has struggled to enact economic reforms meant to curb public spending and help create jobs, while two major militant attacks in 2015 hit its tourism industry, a major source of income.

A government source said last Thursday that the North African state would start a roadshow on Feb. 5 for a 1 billion Eurobond. He said the government could then go to capital markets twice more for a further 2 billion euros in total, although it was still undecided whether that would be in dollars or euros.

(Writing by Patrick Markey; Editing by Hugh Lawson)

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By Kwasi Kpodo

ACCRA (Reuters) – Ghana’s new government plans to review its $918 million programme with the International Monetary Fund because it may need more money for its spending plans, a minister-designate said on Friday.

The three-year programme, signed by the previous government in April 2015, imposes strict targets for revenue collection and spending. It aims to reduce inflation, the public debt and the budget deficit and restore rapid growth to Ghana’s economy.

President Nana Akufo-Addo won December’s election in part by promising voters he would give the equivalent of $1 million to each constituency per year for development, build a dam in every village and a factory in every district while cutting taxes.

“It (the IMF programme) must be reviewed. It will certainly be reviewed,” Yaw Osafo-Maafo told a parliamentary committee vetting him as senior minister. The programme “squeezes the fiscal space” and would be reviewed with the IMF, he said.

Economists say the Fund cannot change its overall programme objectives but interim targets can be modified in the light of performance between each IMF review. As a result, the new government could negotiate less onerous conditions if it finds that targets set for the end of 2016 were not met.

In an indication that this may happen, the new government says the budget deficit stood at around 8 percent at the end of 2016, higher than the 5.3 percent targeted under the programme.

The Bank of Ghana will likely cut benchmark interest rates by 50 basis points to 25 percent on Monday because of the fiscal deficit overshoot and recent pressure on the cedi currency, said a research note by Standard Chartered.

The government will also restore central bank financing of the deficit, Osafo-Maafo said. Under the IMF programme, Ghana was supposed to present a bill for zero deficit financing from 2015 but parliament instead passed a law allowing 5 percent financing.

“It (the law) was unnecessary and it will be reviewed,” Osafo-Maafo, a former finance minister said.

He said the government will continue to borrow “in a better way” to refinance debt, which stands at 71.8 percent of gross domestic product.

The government says it will maintain fiscal discipline and give Ghana double-digit growth for each of the four years of its term in office. Ghana’s main exports are cocoa, gold and oil.

“The economy is not in the best of shape but it (the growth target) is doable,” Osafo-Maafo said.

(Editing by Matthew Mpoke Bigg/Mark Heinrich)

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NAIROBI (Reuters) – Privately-owned Nakumatt, Kenya’s biggest supermarket chain by sales, has agreed to sell a 25 percent stake to a foreign fund for $75 million, part of an effort to bolster its balance sheet and pay off debts, its managing director said on Wednesday.

Nakumatt, which started with a single store in Nairobi in 1992, operates 68 outlets in Kenya and neighbouring states Rwanda, Uganda and Tanzania.

The growing economies of East Africa have drawn in foreign retailers including Bostwana’s Choppies, South Africa’s Game Stores and French retailer Carrefour, through its Dubai-based franchisee Majid al-Futtaim.

“We are already at final stages with the investor. We are just waiting for the money to come,” Atul Shah told Reuters, without naming the fund involved.

The deal is part of the chain’s plan to overhaul its balance sheet and restructure a $75 million debt tranche owed to four local banks, Shah said. Expansion and other investments have pushed its debt up overall to $150 million.

“Nakumatt is going through some financial stress. We are out looking for funds and we are restructuring,” Shah said, adding the cash was expected before the end of February and would help the firm extend the tenor of its debts to more than five years.

“It stabilises our cash flow and it also gives a little room for the expansion plan that we have in place,” he said.

Nakumatt is being guided by a Dubai-based transaction adviser that Shah did not name. The equity deal with the foreign fund values the business at $300 million.

“It is a fair valuation,” Shah said, noting the business had expanded from a single small store to a regional network in 24 years.

(Reporting by Duncan Miriri; Editing by Edmund Blair and Mark Potter)

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By Paul Carsten, Ulf Laessing and Sujata Rao

ABUJA/DAVOS, Switzerland (Reuters) – Nigeria’s efforts to secure funds from international lenders to help haul it out of recession have stalled because it has not submitted the required economic reform plans, according to one of the banks and sources close to the matter.

The government has been in loan talks with the World Bank for a year. It had told the lender it would present its proposed reforms to make the economy more resilient and attractive to investment by the end of December, according to Western diplomats and a Nigerian official who declined to be named as they are not authorised to speak publicly.

But this has not happened and as a result of the delay, which the government has not explained, the Washington-based bank has not been able to consider a loan yet, the sources said.

Nigerian Finance Minister Kemi Adeosun declined to comment.

The African Development Bank (AfDB), meanwhile, is holding back the second tranche of a $1 billion loan for Nigeria, AfDB president Akinwumi Adesina told Reuters on the sidelines of the World Economic Forum in Davos, Switzerland.

“We are waiting for the economic policy recovery programme and the policy framework for that,” said Adesina, without specifying when the AfDB had expected to receive the reform plans.

The World Bank told Reuters in an email that Nigeria was currently preparing its plan “on the basis of which the World Bank will determine with the government the most appropriate lending instrument to support the implementation of the reform plan”.

Nigeria has said it is seeking to borrow $4 billion in total from the World Bank and other foreign institutions and $1 billion through Eurobonds to plug a yawning budget deficit and fund badly needed infrastructure projects.

The country, which relies on oil revenue for most of its income, has been hit hard by the sharp fall in crude prices since 2014 and is struggling to drag itself out of its first recession in 25 years.

It is unclear why the government has not submitted reform plans to the international lenders. The funding deadlock could throw into doubt badly needed infrastructure projects planned for this year, including new roads and improvements to power infrastructure.

The failure to secure the funds, and to present a reform programme, could also deter some investors from Nigeria’s planned $1 billion Eurobonds sale in March.

A Nigerian financial source said the government was working with a consultancy on putting together a package of proposed reforms. The source, who declined to be named as the matter is confidential, did not elaborate.

RECORD BUDGET

Nigeria needs money to help plug a budget deficit of 2.2 trillion naira ($7 billion) for 2016 and to help fund a record budget of 7.3 trillion naira for 2017 which is aimed at stimulating the economy.

It has been holding talks with various institutions and China over the last year to borrow funds but apart from a $1 billion loan from the African Development Bank, at a rate of 1.2 percent, nothing has been made public.

The Abidjan-based AfDB has paid out an initial $600 million in November but is awaiting the economic reform proposals before it disburses the rest of the money.

It is unclear how much money Nigeria is seeking from the World Bank, or whether the lender was pushing for any specific economic reforms from the government.

The diplomatic sources, however, said the bank wanted to see how Nigeria planned to lower its dependence on oil revenues and boost investment, which has been hit by a high official exchange rate for the naira currency.

Nigeria’s central bank, backed by President Muhammadu Buhari, has kept the naira rate to the dollar at 40 percent above the unofficial – or parallel – market rate, which has dried up dollar supplies on official channels.

The policy has also made investors reluctant to commit new projects as they expect the central bank will have to devalue the naira eventually as oil production has been hit by an insurgency in the Niger Delta oil hub.

The central bank has also imposed hard currency curbs making impossible the import of almost 700 goods, which has forced dozens of plants to close running out of spare parts.

Adesina told Reuters on Tuesday that the currency rate problem needed to be addressed by the government in its reform programme, which he said the AfDB was coordinating with the World Bank.

“We are being clear that the quantitative restriction in terms of access to FX is what’s creating huge gap between parallel market rates and official rates,” he added.

($1 = 314.5000 naira)

(Reporting by Paul Carsten and Ulf Laessing in Abuja and Sujata Rao in Davos, Switzerland; Additonal reporting by Chijioke Ohuocha in Lagos; Editing by Pravin Char)

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LONDON (Reuters) – Carlyle Group has agreed to become the largest shareholder in Johannesburg-based Global Credit Ratings (GCR), the U.S. buyout fund said on Tuesday, looking to broaden the pan-African ratings agency’s services.

Terms of the deal, which was first reported by the Financial Times, were not disclosed.

Carlyle is set to buy around half of the equity in GCR from its management founders and German development finance business DEG, which will remain invested in the company, Carlyle said.

GCR serves 400 customers across 20 countries and is the only ratings agency to have a strong presence in multiple geographies across Africa.

“The business plays a critical role in deepening African capital markets and we look forward to working with management to continue to develop and broaden the company’s service offerings,” Steve Burn-Murdoch, a Vice President on the Carlyle Sub-Saharan Africa team, said in a statement.

Carlyle raised $698 million for its Africa buyout fund in 2014, exceeding its $500 million target.

In November, Carlyle, which has $169 billion of assets under management, agreed to buy a majority share of CMC Networks, a pan-African telecommunications business.

In September, it agreed to buy a majority share of Amrod, a supplier of promotional products and clothing in South Africa and neighbouring countries.

Carlyle is already invested in the sector, having partnered with private equity fund Warburg Pincus and a consortium of Canadian-based individual investors to acquire the world’s fourth largest global credit ratings agency DBRS in 2015.

Founded more than two decades ago as the African arm of the New York Stock Exchange-listed Duff & Phelps, GCR expanded through acquisitions, alliances, and organic growth, and says it assigns more credit ratings in Africa than S&P, Moody’s and Fitch combined.

(Reporting by Dasha Afanasieva; Editing by Jason Neely and Mark Potter)

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