BMI View: In line with our expectations, the Banco do Mozambique began nor¬malising monetary policy by cutting the benchmark lending rate by 50 basis points to 16.00% on August I I. We do not believe that the move presages the onset of aggressive easing and reiterate our view that the Mozambican metical’s impressive rally is likely at an end.

In line with our expectations, after a period of tightening which began in April 2010, the Mozambican monetary authorities have begun normalising policy, cutting the bench¬mark Standing Lending Facility interest rate by 50 basis points to 16.00% on August 11. In making the decisión, the bank took consideration of the outlook for inflation, economic growth and ‘important challenges which persist in some sectors’ with ‘signifi- cant weight’ placed on the prospects for eco¬nomic growth. In our previous coverage, we highlighted the fact that a declining rate of credit growth and an increasingly uncertain global economic environment posed risks to both the domestic and external sectors. It is an important point to stress that we do not believe that the move signáis the beginning of a period of aggressive easing. Indeed. the primary objective of monetary policy is price stability, specifically aim- ing to maintain the annual rate of inflation (measured by the rate of change of Maputo city’s consumer price index) in single digits. Maputo’s inflation rate fell to 7.7% in July, down from 9.3% in June and cióse to 17% in December. However, average annual infla¬tion remains at 14.1 % and we do not believe that the Banco do Mocambique (BoM) will contémplate easing in earnest until this measure also falls into single digits. It is also interesting to note that the bank seems to be targeting the cost of borrowing rather than being concerned with aggressively stimu- lating credit growth at this stage. Indeed. along with the rate announcemcnt, the BoM stated that its target for base money at the end of August would be MZN32.5bn. This implies an MI growth rate of 14.2% y-o-y in August, down from 15.4% in July. Slow- ing money supply growth since September 2010, when it peaked at 39.1% y-o-y, has helped to significantly slow the pace of credit growth.

Ngozi Okonjo-lweala, who officially assumed her duties as Nigeria’s Finance Minister on August 15, is expected to be a vocal advocate of fiscal discipline, broad-based economic reform and government accountability.

Ngozi Okonjo-Iweala, former innaging director of the World Bank, officially resumed her role as Nigeria’s finance minister – a post she held over 2003-2006 on August 15. She will also take on added responsibilities, spearheading a wide range of economic and financial initiatives (her position title is Coordinating Minister for the Economy and Minister of Finance). BMI believes her appointment shows a credible commitment to economic reform and long-term sustainability by President Goodluck Jonathan’s administration. Okonjo-lweala is often said to have a strong personality and reportedly pushed for broad powers over economic governance and freedom from political interference as conditions for her taking on the new post. While some have warned that she will clash with central bank governor Lamido Sanusi, we believe the two are ideologically aligned and that possible conflicts will be resolved smoothly in the interest of improved fiscal discipline, meaningful reform and economic development.

Okonjo-Iweala has promised to ‘push beyond finance’ to improve the health and direction of the entire economy. Jonathan has requested her to assist the administration in all aspects of economic development, including reform, implementation of policy and coordination among ministries and different levels of government.

Although at this stage there have been relatively few occasions in which Okonjo- Iweala has spoken to the media about her new role, at each opportunity she has commented on the need to curb government spending, saying that Nigeria needs to be put on a ‘better fiscal path’ She has said that getting to grips with the budget and crafting a responsible 2012 spending plan will be her priorities. Okonjo-Iweala will be trusted to find ways to finance Jonathan’s goals of increasing investment in power plants, roads and agriculture. Recurrent expenditure accounts for nearly three-quarters of Nigeria’s budget and Okonjo-Iweala has said that this figure needs to be reduced in order for the country to be able to afford capital investments. With a global slowdown threatening global oil prices, budget allocation may prove to be challenging, particularly in the wake of a glut in government spending brought about by high oil prices and large budget deficits. Moving forward, this is one reason Okonjo-Iweala has stressed that Nigeria needs to diversify its economy and reduce its reliance on crude oil exports.

The minister said that her actions will reflect President Jonathan’s priorities: economic growth and job creation. This can be accomplished, according to Okonjo-Iweala, through policies supportive of job-creating sectors, including the privatisation of sectors that have the potential to create employment. A senior government source told local news reporters that Jonathan is confident that Okonjo-lweala can help his administration achieve his dream: to record doubledigit growth in GDP. Finally, Jonathan has appointed Okonjo-Iweala as vice chair of the newly formed National Council on Privatization, established to ensure that recently privatised businesses ‘create jobs and wealth’ for Nigerians.

BMI View: The contest for Ghana’s December 2012 legislative and presidential elections is heating up. Although incumbent President John Atta Mills has secured his position as the National Democratic Congress’s presidential candidate, he does not have an easy ride ahead.

Incumbent President John Atta Mills has seen his position strengthened following a resounding victory in the contest to be the National Democratic Congress (NDC)’s presidential candidate in December 2012. Competition came from Nana Konadu Agyeman Rawlings – wife of ex-president, Jerry John Rawlings – but the competition proved insubstantial. Atta Mills won by a landslide, gaining 2,271 votes compared with Nana Konadir’s 90.

Commentary surrounding the vote indicates that the Friends of Nana Konadu Agyeman Rawlings (FONKAR) campaign was easily outpaced by its counterpart Get Atta Mills Endorsed (GAME). Mills apparently benefited from incumbency advantages, reportedly using state resources for transport and at times preventing Nana Konadu from meeting party officials. He also gained support and respect for his refusal to participate in the ‘mudslinging’ that escalated in the lead-up to the vote. Jerry John Rawlings reportedly described President Mills as unintelligent, irresponsible and ungroomed.

With his position now secure, Atta Mills will be focusing on December 2012. As is usually the case in Ghana, the elections – both legislative and presidential – will be a closely fought race. The NDC will benefit from incumbency advantages as well as perceptions that the economy has been generally well managed in recent years. Since 2009, when the party came to power, real GDP growth has been buoyant, the fiscal deficit has been reined in and inflation has stabilised. Furthermore, the oil economy has taken off, albeit with the legal and slowly.

Balanced against this, there may be a feeling among the electorate that it is time for a change and that the opposing New Patriotic Party should return to power. Moreover, the NDC is facing allegations of corruption as well as a range of concerns including the harsh treatment of street hawkers; the dilapidated state of the Accra-to-Kumasi road: delays in the payment of teachers’ salaries; and volatile commodity prices. Looking ahead, the management of oil revenues is likely to become a campaign issue: the NDC has sought to contain expectations about the extent of ‘trickle-down’ from the oil riches, but some disappointment is likely to be expressed among the electorate.

BMI View: Driven by an expansion in oil production and elevated prices, we forecast robust real GDP growth for Angola of 7.5% in 2011 and 15.2% in 2012, a sharp turnaround from the -0.4% growth recorded in 2009. A number of infrastructural investment projects will also have a positive effect on headline growth, but this remains marginalised by the country’s reliance on oil.

Angola is Sub-Saharan Africa’s second largest oil producer, and BMI’s Oil & Gas analysts forecast oil exports to increase to 2.23mn barrels a day (b/d) in 2012 from 1.88mn b/d in 2011, which has a considerable bearing on our forecasts for headline growth. The Angolan oil sector is set to undergo major restructuring over the next few years following the creation of the National Oil Agency, which will take on responsibilities now in the hands of Sonangol the stateowned giant. Refining, storage, transportation and distribution of petroleum products are currently held under a monopoly by Sonangol, but these activities are scheduled for liberalisation by 2012.

Furthermore, new projects are due to come online in the next two years. Exxon- Mobil ‘s project at Pazflor is due for completion in late 2011 with an estimated output of 220.000 b/d, and Chevron’s project at the Tombua Landana complex is due to ready in 2010 with output of 100.000 b/d, boding well for export revenues.

Moving onto investment, we forecast 12% growth in gross fixed capital formation in 2011 and 2012, contributing around 2 percentage points to headline growth forecasts. Much of this is owing to the government’s infrastructural development program aimed at continued rebuilding of infrastructure decimated during the civil war and at demonstrating an ability to provide key services. Estimates put the number of people without adequate housing in Luanda alone at 3-5mn. In response, and in a marked departure from a focus on high-end development that led to the eviction of hundreds of people from Luanda’s shanty towns, President José Eduardo dos Santos has pledged to build lmn new social homes in the capital over coming years.

El ministro de Obras Públicas de Sierra Leona ha aprovechado su visita a la Comunidad Foral para conocer las principales infraestructuras y reunirse con diferentes personalidades del mundo empresarial y político de Navarra.

El pasado domingo aterrizó en Madrid el Ministro Koroma, el objetivo de su visita, conocer España y evaluar la capacidad de nuestras empresas para acometer los retos a los que su gobierno actualmente se enfrenta, mejora de las infraestructuras de energía, agua, infraestructuras e ingeniería.

El ministro ha tenido una agenda muy apretada, reuniones en Madrid con organismos internacionales como la CEOE y comida en el Ministerio de Fomento, posteriormente en Navarra visitas a empresas, instituciones financieras y diferentes cargos políticos de la Comunidad Foral.

El ministro ha mostrado un gran interés por las empresas navarras, especialmente por las empresas de construcción, energía y saneamiento, ya que hoy por hoy, son las empresas que más pueden hacer por su país. El ministro ha reiterado en varias ocasiones su agradecimiento a NAXAN por la organización de la visita y se ha mostrado muy impresionado por el acierto con todas las reuniones organizadas.