Investors update: Zimbabwe to introduce a $100m gold-backed digital currency.

Zimbabwe to introduce a $100m gold-backed digital currency

Highlights

• Zimbabwe’s central bank is reportedly looking to introduce a digital currency, backed by $100 million of gold, to be used as legal tender in the country.
• The move is part of the government’s interventions to deal with its fluctuating currency and represents the first steps towards using the country’s gold reserves to peg the national currency.
• When introduced, the tokens will be exchangeable for small amounts of Zimbabwean dollars and holders are expected to be able to exchange their money for the tokens for protection against exchange rate volatility.

Source: Bloomberg

Our Takeaway

With cryptocurrencies like Bitcoin widely popular among Africans, central banks across the region have been working towards developing digital currencies of their own. The growing allure of such regulated digital tokens and a recent call for a continental cryptocurrency indicate the era of cash could be drawing to an end. However, there are genuine doubts about Zimbabwe’s capacity to implement its digital currency ambitions, given it’s one of the world’s poorest countries with significant infrastructure gaps (only a third of its 15 million people have access to the Internet) and an embattled economy.

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Tanzania gets $153m credit injection from the IMF

Highlights

• The executive board of the International Monetary Fund on Monday approved the first review of Tanzania’s three-year extended credit facility, allowing immediate disbursement of about $153 million in budgetary support, the IMF said in a statement.
• Tanzania’s economic reform program is progressing well in a challenging global economic environment, but authorities should work to boost domestic revenues while stepping up structural reforms to streamline bureaucracy and combat corruption.
• The decision brings total disbursements under the $1.04 billion loan arrangement approved for Tanzania last year to about $305 million.

Source: Reuters

Our Takeaway

Since coming into power in March 2021, President Samia Suluhu Hassan’s efforts to lessen political hostilities, improve the business climate and come up with constructive engagements with the international community have had a positive outcome on Tanzania’s economy and reputation. Last week, the East African nation saw an improvement in its credit rating, with Moody’s Investors Service giving the country a rate of B2 Positive. The UN also predicts Tanzania will be the third fastest-growing economy in Africa for this year at 5.6%, trailing Cote d’Ivoire and Rwanda.

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Telkom FutureMakers, Aions partner to help SA startups grow

Highlights

• South African mobile operator Telkom’s Enterprise and Supplier Development program, Telkom FutureMakers, has partnered with venture builder firm, Aions Creative Technology to help local startups grow.
• This partnership comes on the back of a competitive pitching process where Aions was awarded $3.2 million in funding that will reflect Telkom FutureMakers’ commitment to growing and partnering with South African ICT SMMEs.
• Aions is currently mentoring three startups and with the Telkom funding expects to see this number grow to at least 10 in the coming 12 months.

Source: Disrupt Africa

Our Takeaway

An active early-stage support system involving accelerators, incubators, and pitch competitions helps to bridge Africa’s technology gap by providing crucial access to capital and mentorship to startups. In addition, Telkom’s backing is yet another example of corporates supporting startups and SMEs in South Africa. Across the continent, there is a growing interest among investors, including legacy organizations, in backing African startups through corporate venture capital (CVC) units.