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<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="505" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI-820x505.jpg" alt="" class="wp-image-613227" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI-820x505.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI-300x185.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI-146x90.jpg 146w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI-768x473.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/BDK6EWDJAVI5TEOXLL66Y3L4OI.jpg 1080w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A man walks beneath electricity pylons during frequent power outages from South African utility Eskom, caused by its ageing coal-fired plants, in Orlando, Soweto, South Africa, January 16, 2023. REUTERS/Siphiwe Sibeko </figcaption></figure>



JOHANNESBURG, April 24 (Reuters)&nbsp;&#8211;&nbsp;South African state power utility Eskom said on Thursday that it would implement &#8220;Stage 2&#8221; scheduled power cuts from 1600 local time (1400 GMT) until Friday morning.



&#8220;Higher-than-expected electricity demand, the loss of generation units, and extensive planned maintenance have placed strain on the system,&#8221; Eskom said in a statement.



(Reporting by Bhargav Acharya; Writing by Sfundo Parakozov; Editing by Alexander Winning)

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South African power utility to implement ‘Stage 2’ power cuts

How Salt Lake City transformed into one of the hottest housing and job markets in the U.S.

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="615" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-820x615.jpg" alt="" class="wp-image-613204" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-820x615.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-300x225.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-120x90.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-768x576.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-1536x1152.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/GettyImages-2191254056-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">ZANZIBAR, TANZANIA &#8211; DECEMBER 14: A view of the Rock Restaurant, located on famous Paje Beach in Zanzibar, Tanzania, stands out for its unique location and atmosphere on December 14, 2024. Built on a rock in the middle of the Indian Ocean, this iconic restaurant offers its visitors an unforgettable experience with a landscape that changes with the tides. Known for its seafood menu and natural beauty, the restaurant is not only a popular dining spot but also one of Zanzibar&#8217;s landmarks, attracting both local and international tourists. (Photo by Mehmet Aslan/Anadolu via Getty Images)</figcaption></figure>



DAR ES SALAAM, April 24 (Reuters)&nbsp;&#8211;&nbsp;Tanzania has banned the importation of agricultural products from Malawi and South Africa, saying it was retaliation for similar hostile trade measures from both countries.



The three countries all belong to a regional economic bloc, the Southern African Development Community, SADC.



Tanzania had demanded that both countries rescind bans on imports of agricultural goods from Tanzania by Wednesday, but they had not done so, agriculture minister Hussein Bashe said in a video posted on his X account late on Wednesday.



Malawi had recently banned imports of Tanzanian commodities like maize flour, rice, ginger, and bananas, among others, while South Africa has also proscribed the import of bananas shipped by Dar es Salaam.



&#8220;I would like to officially announce that from this night&#8230; we won&#8217;t allow any agricultural products from South Africa in our country,&#8221; Bashe said, adding a similar ban was being imposed on Malawi.



Talks to resolve the trade impasse, however, would continue with both countries, he said.



He said Tanzania will start prohibiting the transit of agricultural goods from other countries through its territory to land-locked Malawi, and will also ban the export of Tanzanian fertilizer to Malawi.



&#8220;We are taking this measure to protect our business. This is business, and we should all respect each other,&#8221; Bashe said.



(Reporting by Nuzulack Dausen; Writing by Elias Biryabarema; Editing by William Maclean)

The Rock Restaurant on Zanzibar’s Paje Beach

Tanzania bans agriculture imports from South Africa, Malawi

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="4630" height="2675" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/I626AAIJRJP7DJDRYXCYV56KLA-1.avif" alt="" class="wp-image-613046"/><figcaption class="wp-element-caption">The Hillbrow Tower, an iconic tower used to identify the Johannesburg skyline, is seen as the sun rises, in Johannesburg, South Africa, June 20, 2019. REUTERS/Siphiwe Sibeko</figcaption></figure>



JOHANNESBURG, April 24 (Reuters)&nbsp;&#8211;&nbsp;South Africa on Thursday scrapped plans to raise value-added tax after a political backlash that threatened the stability of the ruling coalition government.



The proposal to raise VAT by 1 percentage point over two years, intended to boost state revenue, met resistance as Africa&#8217;s biggest economy grapples with sluggish growth and public discontent over rising living costs.



The dominant African National Congress backed the hike, saying there were no other sustainable revenue sources, while the second largest coalition party, the Democratic Alliance, said the move would pile more pressure on struggling households.



As the DA celebrated the decision, announced by the finance ministry, senior party official Helen Zille said there was a lack of trust between the two groups, leaving the future of the coalition uncertain.



ANC Secretary-General Fikile Mbalula described the differences over the VAT hike as a learning experience for the former liberation movement.



&#8220;If we had a wealth of experience, we may have approached this differently, meaning negotiations and engagement with political parties, with Treasury and parliament oversight prior the passing of the budget,&#8221; Mbalula told a media briefing.



VAT will be maintained at 15%,&nbsp;the finance ministry said.&nbsp;Finance Minister Enoch Godongwana will introduce a revised version of the Appropriation Bill and Division of Revenue Bill within the next few weeks,&nbsp;it added.



&#8220;Political flip-flopping about tax proposals has created confusion, which sends the wrong message to foreign investors,&#8221; Jee-A van der Linde, a senior economist at Oxford Economics Africa, said.



<h2 class="wp-block-heading" id="h-lost-revenue">LOST REVENUE</h2>



Without the VAT increase, estimated revenue is expected to fall short by around 75 billion rand ($4.02 billion) over the medium term,&nbsp;the ministry said.



&#8220;Parliament will be requested to adjust expenditure in a manner that ensures that the loss of revenue does not harm South Africa&#8217;s fiscal sustainability,&#8221;&nbsp;the finance ministry said.



The withdrawn tax hike was a significant retreat from an initial proposal by the National Treasury in February to raise VAT by 2 percentage points to fund spending on health, transport and education.



The DA had challenged the planned tax hike in court and voted against the budget&#8217;s fiscal framework in parliament because of it.



Finance Minister Godongwana had argued in court papers that failure to raise the VAT would cause severe harm to state finances.



The DA had argued the government should cut expenditure instead and some smaller political parties had also proposed deeper expenditure cuts.



The finance ministry said while some suggestions were worthwhile, they &#8220;would not provide an immediate avenue for further revenue in the short term to replace a VAT increase&#8221;.



($1 = 18.6741 rand)



(Reporting by Olivia Kumwenda-Mtambo; Additional reporting by Sfundo Parakozov, Alexander Winning and Kopano Gumbi; Editing by Kim Coghill, Alison Williams and Andrew Heavens)

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South Africa abandons planned VAT hike after pushback

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-820x461.jpg" alt="" class="wp-image-400641" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-820x461.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-1536x864.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/1x-1-2-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">A collection of mixed denomination South African rand coins sit in an arranged photo in Johannesburg, South Africa, on Thursday, June 22, 2017. South Africas inflation rate rose for the first time this year in May after food-price growth quickened from the slowest pace since December 2015. Photographer: Waldo Swiegers/Bloomberg via Getty Images</figcaption></figure>



JOHANNESBURG, April 24 (Reuters) &#8211; The South African rand was stable on Thursday after the finance ministry said it was withdrawing a contentious increase in value-added tax (VAT) that was due to take effect next month and as investors awaited clarity on the budget plans.



The country&#8217;s biggest parties have clashed over the budget&#8217;s proposal to raise VAT by 0.5 percentage points on May 1 and another 0.5 points next year, which threatened the stability of the coalition government and roiled South African markets over recent weeks.



At 1303 GMT, the rand traded at 18.68 against the dollar, near its closing level of 18.6875 on Wednesday.



Danny Greeff, co-head of Africa at ETM Analytics, said that he believed the scrapping of the VAT hike was yet to be fully priced into the market.



&#8220;With a long weekend approaching, we expect the USD-ZAR to trade in a range-bound manner today and tomorrow, absent any major new developments,&#8221; Greeff added.



The VAT hike has caused political wrangling for weeks, exposing deep rifts between coalition government heavyweights, the African National Congress (ANC) and the Democratic Alliance (DA).



The DA, which is the second-biggest party in the Government of National Unity (GNU) stoked fears that it could leave the coalition after challenging the tax increase in court and voting against the fiscal framework in parliament.



&#8220;While the move (to withdraw the VAT hike) suggests the GNU is likely to remain intact, providing a measure of stability, uncertainty persists,&#8221; said Zain Vawda, market analyst at MarketPulse by OANDA.



Vawda said the currency remains under pressure until the government outlines plans for alternative funding or potential budget cuts, leaving room for potential setbacks in the rand&#8217;s recent gains.



The rand hit an all-time low this month on the VAT dispute and risk aversion over U.S. President Donald Trump&#8217;s tariffs.



It has since staged a recovery, but is still down about 2% since the start of the month.



On the Johannesburg Stock Exchange, the blue-chip Top-40 index last traded about 0.7% higher.



The benchmark 2030 government bond was stronger, as the yield fell 15 basis points to 8.89%.



(Additional reporting by Sfundo Parakozov, Alexander Winning and Bhargav Acharya; Editing by Kate Mayberry, Sharon Singleton and David Evans)

South African Economy As Inflation Rate Rises For First Time In 2017

South African rand stable after VAT hike withdrawn, markets await budget clarity

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="5000" height="3186" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/M2ZI6JYVCRIEJFPLEKGFTIN3BA.avif" alt="" class="wp-image-613097"/><figcaption class="wp-element-caption">South Africa&#8217;s Minister of International Relations and Cooperation Ronald Lamola greets Ukraine&#8217;s President Volodymyr Zelenskiy on his arrival ahead of talks with South African president Cyril Ramaphosa in Pretoria, South Africa April 24, 2025. Jacoline Schoonees/DIRCO/Handout via REUTERS</figcaption></figure>



KYIV, April 24 (Reuters) &#8211; Ukrainian President Volodymyr Zelenskiy said he would cut short a trip to South Africa on Thursday and return to Kyiv following a Russian missile attack on the Ukrainian capital.



Zelenskiy, who has been trying to shore up international support for Ukraine&#8217;s defence against Russia&#8217;s invasion, said he would immediately travel back to Ukraine after meeting South African President Cyril Ramaphosa.



&#8220;The Minister of Foreign Affairs of Ukraine will hold all necessary meetings in South Africa to fully inform the country&#8217;s political and public leaders about the situation,&#8221; Zelenskiy wrote on the Telegram app.



Russia pounded Kyiv with missiles and drones overnight, killing at least eight people, wounding more than 70 and smashing buildings in the biggest attack on the Ukrainian capital this year.



(Reporting by Olena Harmash and Tom Balmforth; Editing by)

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Zelenskiy cuts short S.Africa trip after Russian strike on Kyiv

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="1080" height="720" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/HZRODE5UBVK35L6PSBZDHSBEBI.avif" alt="" class="wp-image-613079"/><figcaption class="wp-element-caption">Chinese President Xi Jinping and Kenyan President William Ruto attend a welcome ceremony at The Great Hall of The People on April 24, 2025 in Beijing, China. IORI SAGISAWA/Pool via REUTERS</figcaption></figure>



BEIJING, April 24 (Reuters)&nbsp;&#8211;&nbsp;China and Kenya announced they had upgraded ties to a &#8220;new level&#8221; on Thursday during a meeting between President Xi Jinping and Kenyan President William Ruto in Beijing, as they both pledged to create an &#8220;all weather&#8221; China-Africa community.



In a joint China-Kenya statement, both leaders said they were &#8220;committed to injecting more stability into the world with the certainty of China-Africa solidarity and cooperation&#8221;.



This would provide a backbone to safeguard the &#8220;common interests of developing countries&#8221;, it said, and defend the multilateral system, via &#8220;inclusive economic globalisation&#8221;.



The decision to upgrade China-Kenya relations was made &#8220;in the face of a turbulent international situation&#8221;, the Chinese president was quoted as saying in a separate media pool report.



Africa is a key focus of Xi&#8217;s ambitious Belt and Road Initiative, launched in 2013 to extend China&#8217;s geopolitical and economic influence through global infrastructure development.



Kenya has been a key BRI recipient, and Nairobi has taken a slew of loans from China to finance infrastructure construction projects that have made China the east African nation&#8217;s biggest bilateral lender.



Among the projects, China is helping fund the development of a modern railway line from the port of Mombasa into the hinterland.



Xi and Ruto signed 20 documents together on Thursday, according to a media pool report. These included agreements on science and technology cooperation, vocational education, water resources, ecommerce, intelligent transport systems and the railway sector.



Kenyan officials have been engaging with their Chinese counterparts to secure funds for more projects, including the extension of a railway line to the border with Uganda.



The country has been struggling with a heavy debt load and the accompanying cost of servicing it.



Ruto, who took office in September 2022, has promised that his government will not default on its external debt, pledging to cut waste and boost revenue to tackle the challenge.



It is Ruto&#8217;s first state visit to China as president of Kenya.



<h2 class="wp-block-heading" id="h-increased-cooperation">INCREASED COOPERATION</h2>



Ruto and Xi&#8217;s joint statement said both countries would continue to uphold the World Trade Organisation&#8217;s values and basic principles and &#8220;resolutely oppose new hegemonic tactics such as illegal unilateral sanctions, &#8216;decoupling and chain breaking&#8217;, tariff barriers and technological blockades&#8221;.



The two sides said they would deepen peace and security exchanges by strengthening cooperation in personnel training, the military industry, counter-terrorism, joint exercises and training.



Chinese companies can cooperate with Kenya in building a local medical and health industry according to Kenya&#8217;s needs, the statement said.



Both sides are also willing to rely on major projects such as the Mombasa-Nairobi railway to enhance infrastructure construction and connectivity within Africa.



The opening of direct flights between Beijing and Nairobi was also being &#8220;actively explored&#8221; it said.



(Reporting by Farah Master in Hong Kong, Liz Lee and Beijing newsroom; Editing by Himani Sarkar, Kate Mayberry and Michael Perry)

HZRODE5UBVK35L6PSBZDHSBEBI

China, Kenya upgrade ties amid ‘turbulent international situation’

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-820x234.jpg" alt="" class="wp-image-612798" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">(Credit: IMF Photo/Tuane Fernandes)</figcaption></figure>



Major policy shifts underway have heightened global uncertainty. The series of recent tariff announcements by the United States, and countermeasures by other countries have increased financial market volatility, weakened growth prospects, and increased risks. They come in the context of rising debt levels in many countries and already strained public finances, which in many cases will also need to accommodate new and permanent increases in spending, such as defense. Rising yields in major economies and widening spreads in emerging markets further complicate the fiscal landscape.



We project global public debt to increase by 2.8 percentage points this year—more than twice the estimates for 2024—pushing debt levels above 95 percent of gross domestic product. This upward trend is likely to continue, with public debt nearing 100 percent of GDP by the end of the decade, surpassing pandemic levels. These numbers are based on the&nbsp;<a href="https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025?cid=bl-com-SM2025-WEOEA2025001&amp;utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener">World Economic Outlook</a>&nbsp;reference projections, reflecting tariff announcements made between Feb. 1 and April 4. Amid substantial policy uncertainty and a shifting economic landscape, debt levels could rise even further.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/23/rising-global-debt-requires-countries-to-put-their-fiscal-house-in-order?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11470108/fm-chart1_original.png" alt="Chart1_v1"/></a></figure>



In this environment, fiscal policy faces critical trade-offs: balancing debt reduction, building buffers against uncertainties, and meeting urgent spending needs amid weaker growth prospects and higher financing costs. Navigating these complexities will be essential for fostering stability and growth.



Risk of higher debt



Debt risks were already elevated. According to the&nbsp;<a href="https://www.youtube.com/watch?utm_medium=email&amp;utm_source=govdelivery&amp;v=yab69j8mnOc" target="_blank" rel="noreferrer noopener">Fiscal Monitor’s debt-at-risk</a>, which&nbsp;utilizes data up to December 2024, in a severely adverse scenario global public debt could reach 117 percent of GDP by 2027. This would represent the highest level since World War II, exceeding reference projections by almost 20 percentage points.



Risks to the fiscal outlook have further intensified. Debt levels may rise even further than the debt-at-risk estimates if revenues and economic output decline more significantly than current forecasts due to increased tariffs and weakened growth prospects. Additionally, escalating geoeconomic uncertainties could heighten debt risks, driving up public debt through increased expenditures, particularly in defense. Demands for fiscal support could also rise for those vulnerable to severe disruptions from trade shocks, pushing up spending. The&nbsp;<a href="https://www.imf.org/en/Publications/FM/Issues/2025/04/23/fiscal-monitor-April-2025?cid=bl-com-SM2025-FMOEA2025001&amp;utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener">Fiscal Monitor</a>&nbsp;estimates that a significant rise in geoeconomic uncertainty could lead to a public debt increase of approximately 4.5 percent of GDP in the medium term.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/23/rising-global-debt-requires-countries-to-put-their-fiscal-house-in-order?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11470109/fm-chart2_original.png" alt="Chart2"/></a></figure>



Tighter and more volatile financial conditions in the United States may have ripple effects on emerging markets and developing economies, leading to higher financing costs. This significantly impacts commodity prices, resulting in lower prices and heightened price volatility. Limited fiscal improvements may further heighten risks from rising interest rates, especially as many countries have substantial financing needs. High interest rates could limit essential spending on social programs and public investments. Additionally, reduced foreign aid, due to shifting priorities among advanced economies complicates financing for low-income countries.



Complex policy tradeoffs



In an uncertain and rapidly changing world,&nbsp;countries will need to first and foremost put their own fiscal house in order. This means implementing prudent policies within robust fiscal frameworks to build public confidence and help reduce uncertainty.



Fiscal policy should prioritize reducing public debt and establishing and widening buffers to address spending pressures and economic shocks. This means finding the right balance between adjustment and supporting economic growth, tailored to each country&#8217;s unique situation, available resources, and overall economic conditions.



Countries with limited room in government budgets should implement gradual and credible consolidation plans and allow automatic stabilizers, like unemployment benefits, to work effectively. Any new spending needs should be offset by spending cuts elsewhere or new revenues. For countries with greater fiscal flexibility, it is important to utilize available resources judiciously within well-defined medium-term plans. Fiscal support for businesses and communities impacted by severe trade dislocations should be both temporary and targeted, with a strong emphasis on transparency and effective cost management.



More generally, advanced economies should tackle issues related to aging populations by reprioritizing spending, advancing pension and healthcare reforms, and broadening the tax base. In emerging and developing economies, enhancing the tax system is crucial due to historically low revenues. Low-income developing countries should stay the course on fiscal adjustments given financing challenges. Timely and orderly debt restructuring alongside such adjustments is essential for countries facing debt distress.



Additionally, fiscal policy, alongside other structural policies, should focus on enhancing potential growth. This can help ease challenging tradeoffs between growth and debt sustainability. For instance, well-designed&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2025/04/16/how-to-build-public-support-for-energy-subsidy-and-pension-reforms?utm_medium=email&amp;utm_source=govdelivery">pensions and energy subsidy reforms</a>&nbsp;can generate savings that can be used to support social programs and infrastructure investments.



As significant policy changes and heightened uncertainty reshape the global economic landscape, the fiscal outlook has worsened. To effectively navigate these challenges, governments should focus on building public trust, ensuring fair taxation, and managing resources wisely. By doing so, they can foster resilience and promote sustainable growth in uncertain times.



—This blog is based on Chapter 1 of the April 2025 Fiscal Monitor,&nbsp;“<a href="https://www.imf.org/en/Publications/FM/Issues/2025/04/23/fiscal-monitor-April-2025?cid=bl-com-SM2025-FMOEA2025001&amp;utm_medium=email&amp;utm_source=govdelivery">Fiscal Policy under Uncertainty.</a>”

blog2099x600fm-ch1-rising-global-debt-requires-countries-to-put-their-fiscal-house-in-ordercimf-phot

Rising Global Debt Requires Countries to Put their Fiscal House in Order

Why You Are Getting So Many Fake Job Offers By Text

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="768" height="402" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1DsPom.jpg" alt="" class="wp-image-612780" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1DsPom.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1DsPom-300x157.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/AA1DsPom-160x84.jpg 160w" sizes="auto, (max-width: 768px) 100vw, 768px" /><figcaption class="wp-element-caption">Selim Korkutata | Anadolu Agency | Getty Images</figcaption></figure>



Bitcoin rose for a third day in a broad relief rally after President Donald Trump softened his tone on China tariffs and ratcheted down his rhetoric against Federal Reserve Chair Jerome Powell.



The price of the flagship cryptocurrency was last higher by 2.4% at $93,660, according to Coin Metrics. Earlier, it rose as high as $94,499.86, its highest level since March 3. Bitcoin has now given back more than half of its losses since Inauguration Day and is hovering just under the flat line for the year.



“This recent surge primarily reflects a market seizing the opportunity to capitalize on a dip in an asset that consistently proves its value as a compelling option for portfolio diversification and hedge against macroeconomic uncertainty and U.S. dollar volatility,” Joel Kruger, market strategist at LMAX, told CNBC.



On Tuesday, exchange-traded funds tracking the price of bitcoin saw a spike in inflows as interest in the cryptocurrency’s potential as a hedge strengthened amid continued stock market turbulence and a diving dollar. Bitcoin ETFs logged $936.43 million in daily inflows, their biggest day since Jan. 17, according to data from SoSoValue.



Bitcoin’s rally this week has forced short sellers to buy bitcoin back from the market to close their positions, thereby pushing the price even higher. In the past 24 hours, bitcoin has seen more than $300 million in short liquidations across exchanges, according to CoinGlass.



Demand for spot bitcoin has been contracting on a monthly basis, although that contraction has slowed in recent days, taking downward pressure off the price, Julio Moreno, head of research at crypto data provider CryptoQuant, told CNBC. However, he warned, the demand growth indicators have a ways to go before getting to late 2024 levels, which is what bitcoin would need to sustain its rally and see new all-time highs.

AA1DsPom

Bitcoin heads toward $95,000, rising for a third day and turning positive on the year

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="536" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-820x536.jpg" alt="" class="wp-image-529745" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-820x536.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-300x196.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-138x90.jpg 138w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-768x502.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-1536x1005.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/09/34VAE6NZTJLMTNUVKTT6O3FWY4-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Shoppers look for items as they shop at an outlet of retailer Checkers in Sandton City mall, in Sandton, South Africa, August 28, 2024. REUTERS/Lelethu Madikane</figcaption></figure>



JOHANNESBURG, April 23 (Reuters) &#8211; South Africa&#8217;s annual inflation rate fell for the first time in five months in March to its lowest level since June 2020, due to a drop in fuel costs and softer price rises for tuition.



Headline consumer inflation eased to 2.7% year-on-year from 3.2% in February, below the 2.9% expected by economists polled by Reuters, and outside the South African Reserve Bank&#8217;s (SARB) 3% to 6% target range.



A breakdown by Statistics South Africa showed the fuel index was down 8.8% last month.



Education fees, which are surveyed once a year in March, increased 4.5%, slower than the previous year&#8217;s 6.4% rise.



Some analysts thought the latest inflation numbers gave the central bank scope to cut interest rates at its next monetary policy meeting in May.



&#8220;There is ample room for the (central bank) to cut rates further to support the economy, to soften the hit from the global trade war,&#8221; Elize Kruger, a South Africa-based independent economist,&nbsp;said.



The SARB left its key lending rate unchanged at its last meeting in March after three consecutive cuts, citing risks from U.S. President Donald Trump&#8217;stariffs and the country&#8217;s disputed national budget.



It stuck to that cautious tone in a biannual review of its monetary policy last week.



Elna Moolman at Standard Bank saw signs of weakness in the residential rental market in Wednesday&#8217;s release, which she said was helping keep inflationary pressures benign.



However, the SARB&#8217;s concerns around global tariffs and a weaker local currency meant further rate cuts may not necessarily happen soon, she said.



(Additional reporting by Bhargav Acharya; Editing by Alexander Winning and Rachna Uppal)

Shoppers look for items as they shop at an outlet of retailer Checkers

South African inflation falls to five-year low in March as fuel, education costs ease

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-820x547.jpg" alt="" class="wp-image-523855" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-135x90.jpg 135w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-1536x1024.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2024/08/GettyImages-1258656549-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Wamkele Mene, secretary-general of African Continental Free Trade Area (AfCFTA), during a Bloomberg Television interview at the Bloomberg New Economy Gateway Africa event in Marrakesh, Morocco, on Tuesday, June 13, 2023. The event brings together leaders in the private and public sectors to discuss the world&#8217;s most pressing issues and evaluate potential solutions in the context of local and regional priorities. Photographer: Hollie Adams/Bloomberg via Getty Images</figcaption></figure>



African Continental Free Trade Agreement Secretary General Wamkele Mene says African countries must unify trade policies in order to deal with the disruption caused by U.S. President Donald Trump’s global tariffs.



“The good news out of this crisis is that our heads of states understand that there is not a single market in Africa that will survive on its own,’’ Mene told CNBC Africa in an interview. ’’We are not going to be able to negotiate bilaterally successfully. I think that&#8217;s clear. We will have to leverage on our combined efforts, our combined market size, market share, and combined population size.’’



President Trump has slapped tariffs on almost every country in the world, complaining they have been taking advantage of the world’s largest economy’s openness for trade. Economists have however questioned the methodology used to arrive at the tariffs which saw the small mountain kingdom of Lesotho slapped with the highest tariff rate at 50 percent under Trump’s ‘reciprocal’ tariffs.



While most countries have sought to negotiate, China, the world’s second largest economy has retaliated with 125% tariffs on the U.S. after it jacked up the initial tariffs to 145%.



The tariffs on Africa have called into question the future of the African Growth and Opportunity Act (AGOA) under which a number of African countries enjoyed duty free access to U.S. markets. The pact is due for renewal this year.



Mene said AGOA was practically dead anyway, given the sweeping nature of President Trump’s tariffs.



“I think if we look at the measures that the U.S. introduced, both the tariff and non-tariff measures, AGOA is no longer alive,’’ Mene said. “What we should always remember, though, is that it was a unilateral preference.’’



He said the disruption caused by the tariffs was going to hurt countries like South Africa and Nigeria, the continent’s largest economies as well as smaller ones like Lesotho, Madagascar, Angola and Kenya. But he suggests the continent should use the opportunity to diversify its markets and strengthen intra-African trade, which remains the lowest among global regions at under 20 percent.



He cited the example of Ethiopia which doubled its exports after being kicked out of AGOA by partnering with China.



‘’The benevolence of others is not going to get us anywhere. We&#8217;ve got to very, very quickly redouble our efforts to build this domestic market because we can&#8217;t rely on others.’’



To accelerate the implementation of the AfCFTA, Mene said African Ministers of Trade are looking at ways of simplifying the ‘’complicated method’’ used to reduce tariffs among member countries which was negotiated in 2017. ‘’It’s a very different world to today. So, how do we make sure that we have a liberalization modality that takes account for where we are, the reality of today?,’’ he said lamenting the $50 billion African countries expend annually to import grain when it has grain exporters.

Key Speakers at New Economy Gateway Africa Event

AfCFTA Secretary General Calls for Unified African Trade Policy as Trump Tariffs Hit

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="462" src="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-820x462.jpeg" alt="" class="wp-image-420118" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-820x462.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-160x90.jpeg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico-768x432.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2022/09/107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico.jpeg 929w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">The new economic measures laid out by the U.K. government “will likely increase inequality”, according to a spokesperson from the International Monetary Fund.
Yuri Gripas | Reuters</figcaption></figure>



The International Monetary Fund has cut its forecast for African economic growth by 0.3 percentage points, citing multiple shocks hitting the continent including U.S. President Donald Trump’s sweeping tariffs across the world.



While lauding resilience across the continent, the Washington-based lender now expects its 54 economies to expand by 3.9 percent this year, down from its October forecast of 4.2 percent, it said in a joint statement by its Managing Director Kristalina Georgieva and Hervé Ndoba, the Central African Republic’s Minister of Finance and Budget who is Chair of the African Caucus.



‘’The strong policy actions that have been taken to bring down inflation, stabilize public debt, and reduce external imbalances risk being undone in the face of further shocks,’’ the statement said. &#8220;Risks to the outlook are high amid elevated uncertainty and there are significant differences across countries, with fragile and conflict affected states facing particularly acute challenges.’’



President Trump’s universal tariffs threaten recovering growth across Africa and access to the world’s largest economy through the African Growth and Opportunity Act which is due for renewal this year. Lesotho, derided by Trump as a country nobody has ever heard of, ended with the world’s largest rate at 50 percent.



The continent has struggled to respond, with some countries including Zimbabwe and South Africa saying they would not retaliate and seeking talks, while Kenya has said it is confident it will secure a deal on its own.



The joint statement said African countries will need to intensify domestic reform efforts in the face of the disruption, in order to promote fiscal sustainability while strengthening economic integration through the African Continental Free Trade Agreement (AfCFTA). Central banks should cut rates where appropriate to support economic growth, it added.



‘’At the same time, ambitious structural reforms will unlock growth and drive job creation,’’ it said. “The IMF will remain agile in adapting our toolkit, policy advice, and capacity development to respond to emerging challenges, including from more frequent shocks and transformational shifts from digitalization and AI.’’



The IMF said it remained supportive of initiatives like the G20 Common Framework and the Global Sovereign Debt Roundtable on debt reduction to help countries battling high debt. World Bank figures show average African government debt to gross domestic product ratios remain high at around 60 percent.



The African Caucus, which is made up of African finance ministers and central bank governors, meets with fund management at its annual meetings while the African Consultative Group comprises the Fund Governors of a subset of 12 African countries who are members of the African Caucus and only meets at the Spring Meetings.

107004870-16427966702022-01-21t201709z_969185203_rc2w3s99wb9o_rtrmadp_0_argentina-imf-mexico

IMF Cuts 2025 African growth forecast as Trump tariffs disrupt trade

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="234" src="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-820x234.jpg" alt="" class="wp-image-612691" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-820x234.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-300x86.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-160x46.jpg 160w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-768x220.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-1536x439.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2025/04/blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption class="wp-element-caption">Credit: IMF Photo/Paige Taylor White</figcaption></figure>



The global economic system under which most countries have operated for the last 80 years is being reset, ushering the world into a new era. Existing rules are challenged while new ones are yet to emerge. Since late January, a flurry of tariff announcements by the United States, which started with Canada, China, Mexico and critical sectors, culminated with near universal levies on April 2. The US effective tariff rate surged past levels reached during the Great Depression while counter-responses from major trading partners significantly pushed up the global rate.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459120/weo-chart-1_original.png" alt="two charts showing effective average tariff rates in the United States from 1825-2025"/></a></figure>



The resulting epistemic uncertainty and policy unpredictability is a major driver of the economic outlook. If sustained, this abrupt increase in tariffs and attendant uncertainty will significantly slow global growth. Reflecting the complexity and fluidity of the moment, our report presents a range of forecasts for the global economy.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459126/weo-chart-2_original.png" alt="bar chart showing real GDP growth in three different scenarios"/></a></figure>



<a href="https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025?cid=bl-com-SM2025-WEOEA2025001&amp;utm_medium=email&amp;utm_source=govdelivery">Our World Economic Outlook</a>’s&nbsp;reference forecast&nbsp;includes tariff announcements between February 1 and April 4 by the US and countermeasures by other countries. This reduces our global growth forecast to 2.8 percent and 3 percent this year and next, a cumulative downgrade of about 0.8 percentage point relative to our January 2025 WEO update. We also present a global forecast excluding the April tariffs (pre-April 2 forecast). Under this alternative path, global growth would have seen only a modest cumulative downgrade of 0.2 percentage point, to 3.2 percent for 2025 and 2026. Finally, we include a model-based forecast incorporating announcements made after April 4. Over that period, the United States temporarily halted most tariffs while raising those on China to prohibitive levels. This pause, even if extended indefinitely, does not materially change the global outlook compared to the reference forecast. This is because the overall effective tariff rate of the United States and China remains elevated even if some initially highly tariffed countries will now benefit, while policy-induced uncertainty has not declined.



Despite the slowdown, global growth remains well above recession levels. Global inflation is revised up by about 0.1 percentage point for each year, yet the disinflation momentum continues. Global trade was quite resilient until now, partly because businesses were able to re-route trade flows when needed. This may become more difficult this time around. We project that global trade growth will dip more than output, to 1.7 percent in 2025—a significant downward revision since our January 2025 WEO Update.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459129/weo-chart-3_original.png" alt="two charts showing global growth and inflation forecast change from January 2025"/></a></figure>



However, the global estimate masks substantial variation across countries. Tariffs constitute a negative supply shock for the implementing jurisdiction, as resources are reallocated towards the production of less-competitive items with a resulting loss of aggregate productivity and higher production prices. In the medium term, we can expect tariffs to decrease competition and innovation and increase rent-seeking, further weighing on the outlook.



In the United States, demand was already softening before the recent policy announcements, reflecting greater policy uncertainty. Under our April 2 reference forecast, we have lowered our US growth estimate for this year to 1.8 percent. That’s 0.9 percentage point lower than January, and tariffs account for 0.4 percentage point of that reduction. We also raised our US inflation forecast by about 1 percentage point, up from 2 percent.



For trading partners, tariffs are mostly a negative demand shock, driving foreign customers away from their products, even if some countries can benefit from the trade diversion. Consistent with this deflationary impulse, we have lowered our China growth forecast for this year to 4 percent, a 0.6 percentage point reduction, and inflation&nbsp;is&nbsp;revised down by about 0.8 percentage point.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459145/weo-chart-4_original.png" alt="two charts showing tariffs effects on forecast changes in growth and core inflation for US and China"/></a></figure>



Growth in the euro area, which is subject to relatively lower effective tariffs, is revised down by 0.2 percentage point, to 0.8 percent. Both in the euro area and China, stronger fiscal stimulus will provide some support this year and next. Many emerging market economies could face significant slowdowns depending on where tariffs settle. We have lowered our growth forecast for the group by 0.5 percentage point, to 3.7 percent.



Dense global supply chains can magnify the effects of tariffs and uncertainty. Most traded goods are intermediate inputs that cross borders multiple times before being turned into final products. Disruptions can propagate up and down the global input-output network with potentially large multiplier effects, as we saw during the pandemic. Companies facing uncertain market access will likely pause in the near term, reduce investment and cut spending. Likewise, financial institutions will reassess borrowers’ exposure. The increased uncertainty and tightening of financial conditions could well dominate the short term, weighing on economic activity, as reflected in the sharp decline in oil prices.



The effect of tariffs on exchange rates is complex. The United States, as the tariffing country, may see its currency appreciate as in previous episodes. However, greater policy uncertainty, dimmer US growth prospects, and an adjustment in the global demand for dollar assets—that has so far been orderly—can weigh down on the dollar, as we saw since the tariff announcements. In the medium term, the dollar may depreciate in real terms if the tariffs translate into lower productivity in the US tradable goods sector, relative to its trading partners.



Risks to the global economy have increased, and worsening trade tensions could further depress growth. Financial conditions could tighten further as markets react negatively to the diminished growth prospects and increased uncertainty. While banks remain well capitalized overall, financial markets may face more severe tests.



Growth prospects could, however, immediately improve if countries ease their current trade policy stance and forge new trade agreements. Addressing domestic imbalances can, over a period of years, offset economic risks and raise global output while contributing significantly to closing external imbalances.&nbsp; For Europe, this means spending more on infrastructure to accelerate productivity growth. It also means boosting&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2024/09/12/trade-balances-in-china-and-the-us-are-largely-driven-by-domestic-macro-forces?utm_medium=email&amp;utm_source=govdelivery">support for domestic demand</a>&nbsp;in China, and stepping up fiscal consolidation in the United States.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459182/weo-chart-5_original.png" alt="chart showing current account balance scenarios for US and China "/></a></figure>



Our policy recommendations call for prudence and improved collaboration. The first priority should be to restore trade policy stability and forge mutually beneficial arrangements. The global economy needs a clear and predictable trading system addressing longstanding gaps in international trading rules, including the pervasive use of non-tariff barriers or other trade-distorting measures. This will require improved cooperation.



Monetary policy will also need to remain agile. Some countries may confront steeper trade-offs between inflation and output. In others, inflation expectations may become less-well anchored, with a new inflation shock following closely after the prior one. Countries that encounter resurgent price pressures will require forceful monetary tightening. For others, the negative demand shock will warrant lower policy rates. Monetary policy credibility will be important in all cases, and central bank independence remains a cornerstone.



The increased external volatility from tariff adjustments and a possibly prolonged risk-off environment, may be difficult to navigate for emerging markets. Our&nbsp;<a href="https://www.imf.org/en/Topics/IPF-Integrated-Policy-Framework?utm_medium=email&amp;utm_source=govdelivery">Integrated Policy Framework</a>&nbsp;emphasizes that it is important to let currencies adjust when driven by fundamental forces, as is the case now, and spells out the specific conditions where it is advisable for countries to intervene.



Fiscal authorities face&nbsp;<a href="https://www.imf.org/en/Blogs/Articles/2024/03/28/the-fiscal-and-financial-risks-of-a-high-debt-slow-growth-world?utm_medium=email&amp;utm_source=govdelivery">starker trade-offs</a>&nbsp;with high debt, low growth and rising financial costs. Most countries still have too little fiscal space and need to implement gradual and credible consolidation plans, while some of the poorest countries, also hit with reduced official aid, could experience debt distress.



New spending needs are further weighing on fiscal fragilities. Calls for support will increase for those at risk of severe dislocation from the shocks. Such support should remain narrowly targeted and incorporate automatic sunset clauses. The experience of the last four years suggests that it is easier to open the tap of fiscal support than to close it.



Some countries, especially in Europe, face new and permanent increases in defense-related spending. How should these be financed? For countries with sufficient fiscal space, only the temporary part of the additional spending—that is, temporary support to help adapt to the new environment or the initial bulge in spending to rebuild defense capabilities—should be financed by debt. For all other countries, new spending needs should be offset by spending cuts elsewhere or new revenues.



We should not lose sight of the need for stronger growth. Governments should continue to engage in fiscal and structural reforms that help mobilize private resources and reduce resource misallocation. They should also invest in the digital infrastructure and training necessary to benefit from new technologies such as artificial intelligence.



Finally, we should ask ourselves why our global system warrants remapping—and recognize that decades of deepening trade ties fostered rapid but uneven economic growth. In many advanced economies, there is an acute perception that globalization unfairly displaced many domestic manufacturing jobs. There is some merit to these grievances, even if the share of manufacturing employment in advanced economies has been in a secular decline in countries running trade surpluses, like Germany, or deficits, like the United States.



The deeper force behind this decline is technological progress and automation, not globalization: in both countries the output share of manufacturing has remained stable. Both forces are ultimately beneficial but can be very disruptive to individuals and communities. It is a collective responsibility to&nbsp;<a href="https://www.imf.org/en/News/Articles/2025/04/17/sp041725-spring-meetings-2025-curtain-raiser?utm_medium=email&amp;utm_source=govdelivery">ensure the right balance</a>&nbsp;between the pace of progress or globalization and addressing the associated dislocations.



<figure class="wp-block-image"><a href="https://www.imf.org/en/Blogs/Articles/2025/04/22/the-global-economy-enters-a-new-era?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2025/04/11459185/weo-chart-6_original.png" alt="chart showing output and employment share for Germany and United States"/></a></figure>



This requires that policymakers think well beyond the reductive lens of compensating transfers between ”winners” and ”losers,” be it of technological revolutions or globalization. In this, unfortunately not enough has been done, pushing many to embrace a zero-sum worldview whereby the gains of some only come at the expense of others. Instead, it is important to better understand these root causes so that we can build an improved trading system that delivers more opportunities. This objective is enshrined in our&nbsp;<a href="https://www.imf.org/external/pubs/ft/aa/?utm_medium=email&amp;utm_source=govdelivery">Articles of Agreement</a>, which ask us “to facilitate the expansion and balanced growth of international trade, and to contribute thereby to the promotion and maintenance of high levels of employment and real income.”



Global integration is not an objective in and of itself. It is a means to an end, important insofar as it supports improved living standards for all.



—This blog is based on Chapter 1 of the April 2025 World Economic Outlook, “<a href="https://www.imf.org/en/Publications/WEO/Issues/2025/04/22/world-economic-outlook-april-2025?cid=bl-com-SM2025-WEOEA2025001&amp;utm_medium=email&amp;utm_source=govdelivery">Policy Uncertainty Tests Global Resilience.</a>”

blog2099x600weo-ch1-fostering-core-government-bond-market-resiliencecimf-photopaige-taylor-white

The Global Economy Enters a New Era

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="612" height="357" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg" alt="" class="wp-image-400669" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1.jpg 612w, https://cms.cnbcafrica.com/wp-content/uploads/2021/04/istockphoto-1030878162-612x612-1-300x175.jpg 300w" sizes="auto, (max-width: 612px) 100vw, 612px" /><figcaption class="wp-element-caption">World map with charts and graphs as symbols of global finance</figcaption></figure>



April 23 (Reuters) &#8211; The following company announcements, scheduled economic indicators, debt and currency market moves and political events may affect African markets on Wednesday.



<h2 class="wp-block-heading" id="h-events">EVENTS:</h2>



Kenya&#8217;s President William Ruto makes a state visit to Beijing where he is set to meet his Chinese counterpart Xi Jinping.



<h2 class="wp-block-heading" id="h-global-markets">GLOBAL MARKETS</h2>



Stock markets were enjoying a much-needed relief rally in Asia on Wednesday after President Donald Trump said he had no plans to fire the head of the Federal Reserve, and hinted at lower tariffs for China.



<h2 class="wp-block-heading" id="h-world-oil-prices">WORLD OIL PRICES</h2>



Oil prices rose on Wednesday, extending the prior day&#8217;s gains, as investors weighed a fresh round of U.S. sanctions on Iran, a drop in U.S. crude stocks and a softer tone from President Donald Trump toward the Federal Reserve.



<h2 class="wp-block-heading" id="h-south-africa-markets">SOUTH AFRICA MARKETS</h2>



The South African rand jumped on Tuesday as gold prices rose after U.S. President Donald Trump criticised Federal Reserve Chair Jerome Powell, rattling markets and boosting demand for the safe-haven asset.



<h2 class="wp-block-heading" id="h-kenya-markets">KENYA MARKETS</h2>



Kenya&#8217;s shilling was broadly stable against the dollar on Tuesday with foreign exchange supply and demand evenly matched, traders said.



<h2 class="wp-block-heading" id="h-ethiopia-aid">ETHIOPIA AID</h2>



The World Food Programme suspended malnutrition treatment for 650,000 malnourished women and children in Ethiopia this week due to severe funding shortages, the U.N. agency said, with millions more at risk of losing access to aid.



<h2 class="wp-block-heading" id="h-ghana-politics">GHANA POLITICS</h2>



Ghana&#8217;s President John Dramani Mahama suspended Chief Justice Gertrude Torkornoo with immediate effect and initiated an investigation in response to three petitions filed against her, a statement said.



((Compiled by Nairobi Newsroom))

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