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South Africa: Economists want Ramaphosa to boost economy.

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Economists are hoping to see stability and better economic growth in South Africa under the presidency of Cyril Ramaphosa.

As the nation’s Finance Minister Malusi Gigaba prepares to present the 2018 budget on Wednesday,the economists also want to see a strong rand.

“We need to drive growth in this country.” We are struggling along the way in 2017. It’s more than 1.8% in 2018. To create job creation, we need to drive growth closer to 5%,” said economist Ken Swettenham.

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The election of Cyril Ramaphosa to lead the continent’s largest industrial power was greeted with relief by the markets, while the Zuma era was marked by rising debt, sluggish growth, record unemployment 27.7% and a deterioration in the country’s financial score.

The African National Congress pushed him towards the exit in order to avoid a catastrophe in the general elections of 2019.

But the task of Cyril Ramaphosa promises to be complicated.

For  Economist Ken Swettenham the Southern African nation needs economic stability.

‘‘I think that’s the most important point. stability, we do not know in what sense our markets will evolve: a rise one day, a decline the next day.Our currency is weak one day and strong the next day.Also for our mandatory markets.We have not had stability and it is very difficult to predict anything when you are a businessman, a common citizen and even for the government “,he said.

“It’s going to be the toughest budget since the advent of democracy” in 1994 in South Africa, predicted Piet Naude, a professor at Stellenbosch University.

President Ramaphosa will have to find sources of income while drastically reducing state spending, while he has committed himself to respect one of the most expensive commitments of his predecessor, namely free education higher education for students from disadvantaged families.

In a speech to Parliament Friday, the day after his election, he promised to commit the country to “a new path of growth, employment and transformation.“

Among his immediate priorities, he cited youth employment, whose unemployment rate is close to 50%. He also pledged to restore the confidence of investors and markets, which sanctioned the end of the reign of Jacob Zuma by the degradation of the financial score of the country.

Shortly before his accession to power, Cyril Ramaphosa had expressed his reluctance on a very expensive and controversial project to build new nuclear power plants in his country, ardently defended by Jacob Zuma.

Cyril Ramaphosa, a former businessman, is enjoying the immediate confidence of markets that “think it’s good for the economy,” according to Ken Swettenham, a financial analyst for Liberty Life Insurance Company. Since his election, the national currency, the rand, has recovered.

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Somalia, Ethiopia to jointly invest in seaports

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Somalia and Ethiopia announced they were jointly investing in four seaports to attract foreign investment to their two countries, the latest move in a tussle for access to ports along one of the world’s most strategic waterways.

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After Somalia’s president Mohamed Abdullahi Farmaajo hosted Ethiopia’s prime minister Abiy Ahmed for a meeting at the presidential palace in Mogadishu, the two leaders issued a joint statement of pledges to cooperate on everything from the development of infrastructure including roads linking the two countries to expanding visa services to promote cultural exchanges. 

The statement did not elaborate on which ports the two countries would develop.

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Ethiopian Government states reason for airline privatisation.

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Ethiopia’s government has explained that privatisation of the national airline and state telecommunications company is being done to ease the shortage of foreign currency.

Ethiopia announced last week plans to open its state-run telecoms monopoly and state-owned Ethiopian Airlines to private domestic and foreign investment.



In an exclusive interview with state broadcaster, Fana BC, Dr. Yinager Desie, Commissioner of the Ethiopian National Planning Commission said lower export performance, failure of mega projects to commence production, high demand for imported goods and growing external debt burden have worsened the shortage of foreign currency.

Ethiopia requires more than $13 billion over the coming two years for oil importation, private investment, upgrading of existing projects and for repayment of external debt.

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South African telecommunications firms MTN Group and Vodacom Group have already expressed interest in taking up investment options in Ethiopia’s telecom sector as soon as it opens up.

Desie says the privatised enterprises would generate large amount of foreign currencies to tackle shortage.

The commission will therefore give priority to foreign companies in privatising the enterprises as government’s decision is targeted obtaining foreign currency.

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Uganda approves new coffee law.

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Uganda governing Cabinet has approved a new coffee law, which is expected to streamline mushrooming institutions and players in the sub-sector that contributes sh158b to the economy every month.

According to Col Shaban Bantariza, the deputy government spokesperson, the proposed new law will also repeal the existing legal framework that establishes the Uganda Coffee Development Authority (UCDA).

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“The National Coffee Bill intends to facilitate the development of a competitive, equitable and sustainable Coffee Industry by promoting Coffee research, good Coffee farming practices, domestic consumption of Coffee and adding value to Coffee,” Bantariza said on Tuesday morning.

Bantariza, who was speaking at the Uganda Media Centre, said during a Cabinet meeting on Monday, ministers also proposed the introduction of a coffee auction system, to ease trade in the sub-sector.

“The Bill will also provide for an authority to regulate all on-farm and off-farm activities in the coffee value chain,” he added.

The Government target on coffee production is to export 20 million bags by 2020.

Official figures from UDCA indicate that Uganda currently exports 401,930 bags to the international market annually.

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