The International Monetary Fund has projected that Nigeria and other countries in sub-Saharan Africa will lose about $200 billion in income by the end of 2020. This, the fund said, is as a result of the COVID-19 pandemic that is pulling the global economy towards recession. The lender had projected that the economies of Sub-Saharan African countries would contract by 1.6 percent this year. In the IMF’s latest Regional Economic Outlook, the projected 1.6 percent contraction is the worst reading on record for the region. The projected $200 billion loss in income for Nigeria and other countries in the region according to the Head of the Regional Studies Division in the IMF’s African Department, Papa N’Diaye, in a podcast, shows that the region was “facing unprecedented health and economic crisis that threatens to reverse much of the development progress it has made in recent years. Ndiaye noted that at the end of 2020, countries in the region would face income losses of about $200bn relative to what they were expecting six months ago. The IMF official pointed out that Sub-Saharan African countries were making tremendous progress towards achieving sustainable economic development before the outbreak of the pandemic as the recorded increase in per capita income and life expectancy, among other indices. Ndiaye, however, expressed regret about the temporal delay of the African Continental Free Trade Area, an arrangement which would facilitate regional trade integration. He added that the implementation of the ACFTA “which promised to be a game-changer” had been delayed by the pandemic. He warned that failure to contain the spread of the coronavirus in the region would have catastrophic economic, health and humanitarian consequences, more so that the spread of the disease could undermine progress recorded in other parts of the world. Major oil-producing countries, such as Nigeria and Angola, will suffer more losses, the IMF official said.
Nigerian soldiers stationed in Mainok, Borno state, engaged in a gunfight with suspected Boko Haram insurgents last night. Sources said that the insurgents entered the village around 1900 hours, shooting sporadically.The troops who engaged the insurgents are from the army’s 29 battalion task force in Mainok. When contacted, army spokesman, Col. Sagir Musa, said that nine insurgents were killed and two soldiers were injured. He also said that anti-aircraft guns mounted on two gun trucks were captured from the attackers. In February, seven soldiers were killed when the insurgents attacked Mainok.
Data from the National Pension Commission (Pencom) has shown that total assets under the Contributory Pension Scheme now ₦10.5 trillion as of the end of February 2020. The funds rose by over ₦289 billion in two months from ₦10.21 trillion as of the end of 2019. The breakdown of the figures indicates that the bulk of the funds totalling ₦7.09 trillion had been invested in Federal Government Bonds, while ₦141.06 billion had been invested in state governments’ securities. A total of ₦662.29 billion was invested in corporate debt securities, while ₦2.6 billion and ₦1.6 trillion in supra-national bonds and local money market securities. According to Pencom data, ₦7.8 billion and ₦29.9 billion were invested in foreign money market securities and mutual funds, respectively while ₦532.4 billion and ₦65.04 billion were invested in domestic ordinary shares and foreign ordinary shares respectively. Another ₦219.7 billion and ₦38.4 billion were invested in real estate properties and private equity funds, while ₦47.3 billion and N64.8 billion were invested in infrastructure funds and cash and other assets respectively. The Director-General of Pencom, Muhammad Ahmad, said there was a need to encourage the development of enabling framework for pension funds to facilitate national development as Public-Private Partnership rules needed to be strengthened at both the national and state levels.
Small and medium businesses in South Africa will have five years to repay loans taken out under a government scheme to help cope with the coronavirus crisis, the country’s treasury said on Tuesday. President Cyril Ramaphosa had announced the scheme, which involves bank loans guaranteed by the state, in April to help businesses with an annual turnover of less than 300 million rand (₦6.44 billion). The loans intended to meet urgent requirements such as salaries, rents and contractual obligations, will be disbursed to the recipients in up to three monthly instalments. The companies will not have to pay anything back to the banks for the first three months and will then have five years to pay off the loan and interest, it said. The interest rate will be the repo rate of the South African Reserve Bank plus 3.5%, so currently 7.75%. The treasury also said all major South African private banks are part of the scheme and will share the risks with the treasury according to a pre-determined loss-sharing mechanism. Many of South Africa’s small and medium-sized firms are being affected by when the SA authorities introduced a lockdown at the end of March in an effort to contain the coronavirus pandemic, as they lost much of their revenue but still faced fixed costs. Many of the businesses have now been allowed to operate with 50% of their workforce under partially eased restrictions, but many have warned it will take months to return to normal as supply chains have been disrupted and demand remains weak. The loan guarantee scheme is part of a 500 billion rand package announced by Ramaphosa to try to stave off an economic crisis in Africa’s most industrialised country, which was already in recession before the coronavirus reached its shores.