| Welcome to Next Africa, a twice-weekly newsletter on where the continent stands now — and where it's headed. Sign up here to have it delivered to your email. Kenya has fallen foul of the International Monetary Fund and investors are none too happy about it. Under a $3.6 billion funding program signed in 2021, the East African nation undertook to curb spending and bolster tax collection, but the government failed to meet its obligations. President William Ruto's administration tried to bring in new taxes last year, but backed down after deadly protests.  An aerial view of Nairobi, Kenya's capital. Photographer: Han Xu/Xinhua News Agency The upshot is that a planned IMF review of the state's finances has been called off and it won't pay out a final $850 million. The writing appears to have been on the wall for some time, though, and the authorities have been lining up other funding to plug the hole in the budget. A $1.5 billion loan was negotiated with the United Arab Emirates — a facility that could potentially inflate state borrowing beyond the level agreed with the IMF and carries foreign-exchange risks. The government has also rearranged a eurobond, pushing its maturity out by 11 years, enabling it to settle some expensive syndicated loans. The announcement that the IMF program had been terminated sparked a selloff in Kenya's foreign debt and the shilling. While the state is discussing an alternative arrangement with the Washington-based lender, the potential terms remain unclear. Any funding arrangement that fails to ensure public finances are kept in check is likely to stoke further unease in the financial markets and weigh further on the country's bonds, according to Patrick Curran, a senior economist at Tellimer. Ruto has steeled himself against any political fallout, agreeing a power-sharing pact with his main rival Raila Odinga. That should help any budgetary measures he proposes get through parliament and bolster his changes of winning a second term come 2027 elections. Still, he may not want to test the public's appetite for drastic tax changes. — Helen Nyambura Key stories and opinion:
Kenya Foregoes $800 Million IMF Review, Seeks Fresh Program
Kenya Sells $1.5 Billion Bond as the Government Extends Debt
Where Will the Fire in Kenya Leap to Next?: Justice Malala
Kenya's Ruto Teams Up with Odinga to Consolidate Grip on Power
How Kenya Protests Led to a Government Shake-Up: QuickTake We'll be holding our inaugural Next Africa seminar at our Johannesburg office at noon on April 4. Please message gbell16@bloomberg.net if you would like to join the discussion with South African Trade and Industry Minister Parks Tau, Business Unity South Africa CEO Khulekani Mathe and Yvonne Mhango, Bloomberg's Africa economist. We'll be looking at whether 2025 is the inflection point for South Africa and how government and business can navigate a challenging global environment.  | | | For two years, Hisham Salih Yagoub has fielded calls from frantic drivers across war-torn Sudan asking him to pay thousands of dollars to a paramilitary group that's been waging war against the army – extortion to get his truckloads of gum arabic to port. The sticky tree sap is an essential ingredient in everything from Coca-Cola to M&Ms, with Sudan producing 70% of global supply and Yagoub's company, Afritec, one of the biggest industry players. Two years into the conflict, the supply chain in Sudan is untraceable — with no way to tell whether household brand names contain products that are funding war criminals, trade data and interviews with officials and experts show.  Workers sort gum arabic in a warehouse in Port Sudan. Photographer: Eduardo Soteras/Bloomberg Secretary of State Marco Rubio said South Africa's ambassador to the US isn't welcome in the country after the envoy made comments about President Donald Trump, escalating a running feud between Washington and Pretoria. Rubio made the announcement on X, linking to a Breitbart News article on a conversation Ebrahim Rasool had with a think-tank. The ambassador said Trump and his Make America Great Again supporters are effectively a "supremacist" movement projecting "White victimhood." State Department spokeswoman Tammy Bruce described Rasool's comments as "obscene." The Rwanda-backed rebel group behind a flare up of violence in eastern Democratic Republic of Congo pulled out of peace talks a day before they were due to start in Angola. The M23 militia's decision came after the European Union imposed sanctions on three senior Rwandan military officials and five rebel leaders. Those censured include Major-General Ruki Karusisi, who commands Rwandan special forces deployed in eastern Congo.  A member of the M23 militia in Bukavu in eastern Congo. Photographer: Luis Tato/AFP/Getty Images Suspected pirates boarded a Yemeni-flagged dhow off the eastern coast of Somalia, the second such attack in a month. As many as seven hijackers remain on board the vessel, which has a crew of eight Somali nationals, the EU Naval Force said. The incident occurred in the vicinity of Eyl, a coastal town in Somalia's semi-autonomous Puntland region that became known as a pirate haven in the late 2000s. Last year saw a resurgence in Somali piracy, according to the International Maritime Bureau. Botswana, the world's largest diamond producer, is betting that selling big gems to rich young Americans will ease its economic woes, and it's trying to catch their eye via Instagram and TikTok. The strategy saw it dip a toe into the world of luxury advertising in New York's Greenwich Village, where it wined and dined social-media influencers to pitch natural stones over lab-grown rivals to affluent 20- and 30-somethings. "One of our strategies is to really counter synthetics," Bogolo Kenewendo, Botswana's mines minister, said in an interview.  Diamonds displayed at an event held to promote Botswana's diamonds in New York. Source: BFA Niger's military leadership ordered three Chinese oil executives to leave the country, saying they failed to comply with a new provision of the mining code aimed at promoting the use of local goods and services. The move comes amid a broader shakeup of the industry across West Africa as cash-strapped juntas seek to generate more revenue from natural resources. Top local officials of China National Petroleum Corporation, Zinder Refining Company and the West African Gas Pipeline Company were given 48 hours to depart. Thank you for your responses to our weekly Next Africa Quiz and congratulations to Ronald Tamale, who was first to identify Botswana as the African country whose deal to buy a stake in a Belgian diamond trader appears to be in limbo. Nigeria's annual inflation eased for a second straight month, stoking optimism that cost pressures have peaked. Consumer prices rose 23.2% in February, the National Bureau of Statistics said. The agency last month overhauled the index for the first time in 16 years to better reflect the inflation pressures facing households in Africa's most-populous nation. Cooling inflation could encourage the central bank to hold interest rates steady again when policymakers meet in May. Thanks for reading. We'll be back in your inbox with the next edition on Friday. Send any feedback to mcohen21@bloomberg.net | 
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