South Africa, the African continent’s largest economy, had better take note. West Africa, an area that includes Nigeria, has for the third time in three years notched up more private equity (PE) deals than Southern Africa.
West Africa had the highest reported value of deals ($545m) during 2013, surpassing Southern Africa ($491m) and Eastern Africa ($163m), according to the 2014 Deloitte’s East Africa Private Equity Confidence Survey, published this month. Continue reading »
In a world of shrinking liquidity, sub-Sahara African governments are finding little room to manoeuvre in stimulating their cooling economies as investors and ratings agencies take a much harder line on state excesses.
With growth prospects improving in developed markets and questions being raised about the fate of emerging markets – especially with growing evidence of a bigger than expected Chinese slowdown – investors have started to write off large swathes of the developing world. Continue reading »
Uganda’s government has been locked in a long-standing battle with companies over the development of its 3.5bn barrels of oil, mostly located around the Albertine Graben.
So it is with some relief that last week a memorandum of understanding was finally signed with UK-based Tullow Oil, Total of France and China National Offshore Oil Corporation, providing a framework for commercial production which builds on an April agreement. Continue reading »
Nigeria has been beloved of investors lately, the accessible face of an irresistible rising demographic in sub-Saharan Africa. But it faces challenges, and none more so than the paucity of its infrastructure.
A new report this week by Ecobank spells out just how big that infrastructure gap is, and how it is replicated widely almost everywhere in mid-Africa. And it does so at a vital moment, as Nigeria is about to move to the second stage in its privatisation programme, involving the completion and sale of 10 national integrated power projects (NPPs), with a target of the end of March. Continue reading »
By Cate Reid
China may dominate the rare earths market, but there are many unexplored sources – and it is Africa that geologists believe holds the most potential. Junior mining companies are scrambling to get a foothold into this promising sector – and many countries could be set to reap the benefits.
But with high extraction costs and an unpredictable market, it won’t be easy. Continue reading »
It was the growth story that everyone was talking about. Africa, especially the sub-Saharan part, was finally coming good, with growth rates averaging well over 5 per cent and seemingly a one-way bet.
But the in its latest world economic outlook, the IMF has trimmed its 2013 growth forecast for the region by 0.4 percentage points. That puts it alongside Latin America as the region with the biggest cut in the IMF’s forecast. Even North Africa – including troubled Egypt – had a smaller cut in its growth forecast. What gives? Continue reading »
By Craig Baker and Andy Ratcliffe
The arguments over whether South Africa should still receive aid from Britain, following Justine Greening’s announcement that there would be no new DFID projects in South Africa, show how the global debate about the continent is shifting.
Africa was once viewed as a region that had stalled, making little or no progress. Now, the world is starting to notice the pace of economic change. Headlines on the theme of ‘Africa rising‘ are appearing more and more in international newspapers. But many doubt that this economic growth is actually improving living standards for the average African citizens. Continue reading »
It began 20 years ago, carting meat around Lusaka in the back of an ageing Land Rover. Since then, Zambeef has grown into one of the largest companies in Zambia’s booming economy. Now it hopes to replicate its success in west Africa.
The FTSE AIM traded company, whose primary listing is on the Lusaka Stock Exchange, is a curious entity in the modern food industry: a near fully vertically-integrated operation which produces, processes, distributes and retails, all in-house. Continue reading »
By Kandeh K Yumkella of UNIDO
When I look at the future of my continent, three words come to mind: hope, opportunity and responsibility.
Hope, because there is positive change happening throughout Africa. Opportunity, because of the commodity boom. Responsibility, because we – the African people and our leaders – still need to create 10m jobs a year for our young people, and lift out of poverty the over 50 per cent of Africans who still live below $2 per day. Continue reading »
In October last year, beyondbrics wrote of a sub-Saharan debt rush – partly based on Zambia’s successful issue, and on investors’ hunt for yield and diversification.
But now there is now talk of “original sin” – excessive borrowing in non-domestic currency; yields have increased and spreads have widened. What’s going on? Chart of the week takes a look. Continue reading »
Tanzania is one of several African countries that have announced their intention to issue eurobonds this year, taking advantage of favourable conditions for frontier market sovereign debt.
But instead of going to market with a plain vanilla eurobond as expected, the east African country has surprised money managers with plans to issue a $500m, seven-year amortising bond this week in a private placement. Continue reading »
GDP growth is thought to be correlated to everything from conflict risk to whiskey consumption. And the current slew of positive stories about Africa are driven, in part, by the impressive GDP statistics posted by countries across the continent.
But these numbers are poor estimations of economic development, says Morten Jerven at Simon Fraser University. His argument is not that GDP does not say much about happiness, equality, environmental sustainability. It’s a more technical point: many figures are, well, just wrong. African GDP might actually be growing faster than we think. Continue reading »
Rating agency Fitch is ending the year with predictions that sub-Saharan Africa will be “a bright spot in an otherwise gloomy world in 2013″. With growth expectations of above 5 per cent, the region is set to benefit from rising investor interest, and upgrades may be in order.
Among the agency’s 15 rated sub-Saharan sovereigns, nine have stable outlooks and three positive. So who are the ones to watch? Continue reading »
By Yvonne Mhango of Renaissance Capital
Elections in Ghana tend to arouse less uncertainty than those in most of sub-Saharan Africa, due to its relatively stable political environment and mature democracy. This was affirmed by the smooth constitutional transfer of power following President John Atta Mills’s death in July, to his former vice-president, John Dramani Mahama.
However, a tight presidential election on December 7 – like that of 2008 – would increase the political risks. And there is a lot a stake from the ramping up of oil production to dealings with the IMF. Continue reading »