Weekly Economics Wrap: 25 July – 1 August 2024: Telecom Upgrades in Namibia, Rand Strengthens, and Global Market Highlights

1 August, 2024

Namibian Telecom and Connectivity Upgrades

UCOM and BDQ Mobile Network Solutions have announced a significant 10-year partnership aimed at revitalizing Namibia’s third mobile phone operator. BDQ, in collaboration with American-based VANU Technology, will deploy advanced telecommunications infrastructure to enhance service quality.

In related news, Telecom Namibia has successfully activated the Equiano subsea cable. This major development promises to greatly improve internet connectivity with 12 fiber pairs and a design capacity of 144 Tbps—20 times the capacity of existing connections between Europe and Southern Africa. An economic impact assessment predicts a 7.5% increase in internet penetration in Namibia by 2025.

South African Financial Market Insights

The South African rand strengthened on Friday, trading at 18.27 against the dollar, up approximately 0.6% from its previous close. This gain followed U.S. inflation data, which did not alter expectations of a Federal Reserve interest rate cut in September.

Shoprite Group’s Checkers Sixty60 on-demand delivery platform reported a 58.1% growth for the 2024 financial year. The retailer also saw double-digit growth for its overall group and core Supermarkets RSA business unit, which constitutes over 80% of its sales.

African Economic Developments

Nigeria’s central bank sold $148 million in foreign exchange to 29 authorized dealer banks on July 22 and 23, aiming to ease pressure on the naira. The sales, conducted at rates between 1,470 and 1,510 naira, come as the currency faces significant pressure, having recently hit a four-month low of 1,640 naira.

Additionally, Nigeria’s government has approved the sale of crude oil to the Dangote refinery in naira, resolving a dispute with oil regulators. The Nigerian National Petroleum Company Limited has been instructed to implement this change immediately, smoothing transactions and addressing previous issues with crude supply.

Global Financial Updates

Asian shares experienced a rebound on Monday as a busy week of earnings reports and central bank meetings looms. The U.S. and UK might signal potential easing, while Japan could consider raising borrowing costs. Oil prices have edged up due to escalating conflict in the Middle East, following a rocket attack in the Israeli-occupied Golan Heights attributed to Hezbollah.

Samsung Electronics reported its fastest growth since 2010, achieving operating profits of $7.5 billion for the second quarter. This 1,462.29% increase from the previous year was driven by rising memory chip prices and strong demand for generative AI. Additionally, robust sales of OLED panels contributed to a 23.4% rise in overall sales.

The Federal Reserve, after a two-day meeting, left interest rates unchanged but suggested that a rate cut could be possible in September. The central bank noted that inflation is approaching its 2% target, though additional efforts are required to fully meet its objectives.

Financial Indicators