By Ben Payton, Maplecroft
Africa’s booming economic performance over the past decade has seen GDP growth jump from an average of 2.5 per cent a year in the 1990s to 6 per cent a year since 2000. Asia’s insatiable demand for raw materials and the subsequent commodity price hikes have spawned an array of costly extractive projects on the continent, and investment and consumer demand are on the rise.
However, a growing reliance on borrowing, combined with the downturn in commodity prices points to a deteriorating outlook for many of the continent’s key growth markets in the medium term. Read more
The US dollar surged again on Wednesday against a basket of emerging market (EM) currencies, adding urgency to the question of which EM countries are most vulnerable to a receding “carry trade”, the multitrillion dollar flow that has swollen domestic debt markets since 2009.
A soaring dollar piles pressure onto EM carry trade investors, who typically borrow dollars at low interest rates in order to buy high yielding EM domestic debt. When the dollar surges, they suffer currency losses that offset their interest rate gains, prompting them to sell. Read more
Mobile money services in Africa isn’t just all about M-Pesa in Kenya. Orange Mobile has just rolled out its first international mobile money transfer service between Mali, Senegal and Ivory Coast – the first such service in the region.
But there are some big players offering similar, rival services. Can Orange make a difference? Read more
A lot has been written about the potential of the African consumer but there’s not been exactly a flood of deals to demonstrate investor interest.
Well, here’s one: the Abraaj group, one of Africa’s larger private equity groups, has snapped up Fan Milk International of Ghana. It’s a vote of confidence for the west African country, which has seen consistently high growth over the last few years, and for the region in general. Read more
Californian oil major Chevron has given the go-ahead to a $5.6bn development project of an Angolan offshore oil field which will be the company’s second largest investment in African crude to date after its Agbami field in Nigeria.
The Mafumeira Sul project, run through Chevron’s subsidiary Cabinda Gulf Oil Company, is scheduled to begin production in 2015, and will eventually pump 110,000 barrels of crude oil per day from five new platforms, Chevron said. Read more
The conflict in Mali has intensified following the onset of a major French military intervention and promises by Islamists to retaliate against western targets across the region. What might be the economic spillover effects of the conflict?
Mali may not play an integral role in the world economy, but many of its neighboring countries do as suppliers of key petrochemicals and minerals – so the potential for disruption from the conflict is more significant than it might at first seem. Read more
Welcome to the new hub
Start-up airlines have revolutionised air travel in Ghana over the past 18 months. Fares on domestic routes have fallen by up to 75 per cent. Passenger numbers on the main route from the capital Accra to the second city Kumasi have increased fivefold.
Now, two of the new domestic carriers are hoping to spread their wings throughout west Africa, where economies are growing fast but the aviation networks remain so poor that some experts call it “the last frontier” of air travel. Read more
Sierra Leone’s president Ernest Bai Koroma (left) may have avoided a run-off in this month’s presidential election, but he still a faces a dilemma – how to attract and retain investors while swelling government coffers to put citizens on the road to prosperity.
Koroma won a second term in elections held in mid-November. He received 58.7 per cent of the vote, narrowly surpassing the 55 per cent threshold needed to avoid a run-off with his main opponent, Julius Maada Bio, who received 37.4 per cent of votes. Read more
Exports of west African oil are on the rise, with Asian nations increasing supplies from the region. According to a recent report by Reuters, China, India, Indonesia, Taiwan and others in the region bought an average of 1.74m barrels of oil per day from west Africa for first nine months of 2012, up about 8 per cent from the same period a year ago.
The 2012 figures represent an overall record for the region, the report states, with exports to Asia rising more than 50 per cent over the last five years to meet growing demand. The reasons for the demand, however are not entirely clear cut. Is this a response to Iranian sanctions, as suggested? Read more
A random assortment of dark wood desks and chairs crowd the room. The tatty carpet is no longer glamorous but it is still just about red. A big-handled bell sits on a centre table.
Welcome to the Sierra Leone Stock Exchange. Number of stocks traded: one. Read more