Weekly Economics Wrap: 10-17 October: Key Developments in Air Travel, Banking, and Global Markets

Air Connect Namibia Delays Launch of Flights Air Connect Namibia has announced a delay in the planned launch of Air Botswana’s connecting flights between Gaborone and Windhoek, initially scheduled for October 1. The flights, connecting Maun, Gaborone, Kasane, and Windhoek, are postponed, with details on a new launch date yet to be provided. This delay marks a setback for travel connectivity between Namibia and Botswana.

Bank of Namibia Lowers Interest Rate Again In a move aimed at bolstering the economy, the Bank of Namibia has reduced its main interest rate for the second consecutive time, citing a faster-than-expected drop in inflation. The Monetary Policy Committee lowered the repo rate by 25 basis points to 7.25%, following a similar reduction in August. The central bank’s decision reflects a commitment to fostering economic growth amid inflationary easing.

South Africa’s Untapped Offshore Oil Potential The Maritime Business Chamber in South Africa has raised concerns over the government’s slow action in tapping into the country’s massive offshore oil and gas reserves, estimated at 27 billion barrels. Chairperson Unathi Sonti highlighted the potential economic boost from developing these resources, which lie off South Africa’s south, west, and east coasts. The chamber urges faster decision-making to maximize this opportunity.

SADC Backs Zambian Economist for AfDB Presidency The Southern African Development Community (SADC) has reaffirmed its support for Zambian economist Samuel Maimbo in the race for the presidency of the African Development Bank (AfDB). This backing comes despite South Africa’s nomination of Swazi Tshabalala as its candidate. SADC’s endorsement of Maimbo signals the bloc’s intent to influence leadership at the AfDB, as the race heats up.

Nigeria’s Oil Regulator Rejects Shell’s Sale Nigeria’s oil regulator has rejected Shell’s proposed $1.3 billion sale of its onshore oilfields to the Renaissance group, citing the buyer’s lack of qualifications. Shell, through its subsidiary Shell Petroleum Development Company, is providing the regulator with additional information, although it did not confirm the rejection directly. The sale forms part of Shell’s broader efforts to divest its onshore assets in Nigeria.

Nigeria Signs Major Gas Supply Deal In a significant move to monetize its gas reserves, Nigeria has signed a deal with joint venture partners, including Shell, TotalEnergies, and Eni, to supply gas for a $3.5 billion fertilizer and petrochemical plant in Brass, Bayelsa state. The agreement will provide 270 million standard cubic feet of gas per day to the facility, advancing Nigeria’s ambitions in the gas sector.

US Dollar Gains Amid China’s Tepid Stimulus The US dollar continued its upward trajectory in Monday’s Asian trades, bolstered by weaker-than-expected stimulus measures from China. As Japan observed a holiday, the euro dropped by 0.13% and the British pound slipped by 0.2% to $1.30. The dollar remained steady against the yen at 149.20, as market attention shifted to Chinese economic policy.

Global Steel Demand to Decline in 2024 The World Steel Association predicts a 0.9% decline in global steel demand to 1.75 billion tonnes in 2024 due to high costs, economic uncertainty, and tighter financing conditions. However, a 1.2% recovery is expected in 2025, driven by infrastructure spending. Despite the forecasted rebound, challenges remain, especially from geopolitical tensions and a potential slowdown in the automotive sector.

Chip Market Recovery Expected to Continue into 2025 ASML Holding NV CEO Christophe Fouquet expressed optimism about the recovery in the semiconductor market, expecting it to extend “well into 2025.” This follows a disappointing third-quarter earnings report, which sparked a broad selloff in the chip sector. Despite the short-term setback, long-term growth prospects remain robust, driven by increasing demand for chips across various industries.