The United States said Wednesday that it had signed record trade deals with Africa this year, worth a total of $14.2 billion, against the backdrop of a battle for influence with China on the continent. Nearly 550 new trade and investment agreements were signed, representing a 67% increase over 2022 in terms of number and value, said British Robinson, coordinator of the US-led Prosper Africa trade initiative. “We’ve had a record year for U.S.-Africa relations,” said Judd Devermont, White House official in charge of sub-Saharan Africa, during an online press conference organized a year after a summit with African leaders at which U.S. President Joe Biden pledged to “pull out all the stops” on the continent. In December, Washington pledged to invest $55 billion over three years in Africa. This strategy is aimed in particular at countering the growing presence of China, which has made inroads in infrastructure construction, investments and loans. Read more: Africa News
The US central bank has signalled it could start cutting interest rates next year if inflation continues to fall. Forecasts released by the Federal Reserve showed a majority of policymakers expect to cut its key interest rate in 2024. But on Wednesday the central bank decided to keep rates unchanged again at 5.25%-5.5%, a 22-year high. Markets surged on signs borrowing costs could be reduced next year, with the Dow Jones closing at a new record high. The three major indexes in the US ended the day up 1.4%. The bank has raised rates sharply since March 2022, in a bid to cool the economy and slow price rises, which last year soared at the fastest rate in decades. Read more: BBC News
The development of the most controversial construction project in East Africa, The East African Crude Oil Pipeline (Eacop), is fast becoming a reality. The joint project between Uganda, Tanzania, and foreign investors has received the first 100km of pipes, as disclosed by the project’s coordinator, Mr. Msovu. This indicates that the project has officially commenced. The project organizer stated that at least 5000 pipes are already in place as the large-scale work is about to start, according to a report seen in the Tanzanian news publication, The Citizen. He stated; “The project is now set to begin its construction phase. The project is still ongoing, and both countries (Uganda and Tanzania) are ensuring that is it carried out as intended.” “The recently delivered pipes have a maximum length of 100 kilometers, we have initiated the process of moving them from Dar es Salaam to Tabora, the project’s center, and from there they will be distributed to other locations,” he added. Read more: Business Insider
The cost of servicing debt for the world’s 24 poorest nations could surge by as much as 39% in 2023 and 2024, according to the World Bank’s latest International Debt Report released Wednesday. “Record debt levels and high interest rates have set many countries on a path to crisis,” said Indermit Gill, the World Bank Group’s chief economist and senior vice president for development economics. “Every quarter that interest rates stay high results in more developing countries becoming distressed — and facing the difficult choice of servicing their public debts or investing in public health, education, and infrastructure,” he added. Underscoring the gravity of the situation, the World Bank said there were 18 sovereign defaults in 10 developing countries in the last three years — more than the total in the previous two decades combined. The list includes defaults in Ghana, Sri Lanka and Zambia, among others. Read more: CNBC
The International Energy Agency on Thursday said evidence of softening global oil demand is mounting and a slowdown is expected to continue into 2024, reaffirming a starkly different outlook compared to oil producing group OPEC. The IEA said oil market sentiment had turned “decidedly bearish” in recent weeks, even after some members of OPEC and non-OPEC oil-exporting allies — collectively known as OPEC+ — on Nov. 30 announced a new round of voluntary production cuts in the first quarter of next year. Oil prices were higher on Thursday morning, paring losses after recently falling to their lowest level since late June on gnawing oversupply concerns. Read more: CNBC
Markets have entered a “new paradigm” as the global order fragments, while heightened recession risk means that “bonds are back,” according to HSBC Asset Management. In its 2024 investment outlook, seen by CNBC, the British lender’s asset management division said that tight monetary and credit conditions have created a “problem of interest” for global economies, increasing the risk of an adverse growth shock next year that markets “may not be fully prepared for.” HSBC Asset Management expects U.S. inflation to fall to the Federal Reserve’s 2% target in late 2024 or in early 2025, with the headline consumer price index figures of other major economies also set to drop to central banks’ targets over the course of next year. The British lender’s asset management division said tight monetary and credit conditions have created a “problem of interest” for global economies, increasing the risk of an adverse growth shock next year that markets “may not be fully prepared for.” HSBC AM believes global markets are heading towards a “new paradigm,” in which interest rates remain at around 3% and bond yields around 4%, driven by three major factors. Read more: CNBC
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