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Published 15th April 2016

Vol 57 No 8


Sierra Leone

Africa probes the Panama connection

Chart © Africa Confidential 2016
Chart © Africa Confidential 2016

The Panama Papers have prompted governments to look more seriously at the costs of trade mispricing and illicit financial flows

Following the leak of over eleven million company files from the Mossack Fonseca law firm in Panama on 3 April, many African activists and law enforcement officers have been searching the documents for evidence of malfeasance. Of course, being a client of Mossack Fonseca, whose premises were raided by Panamanian police on the morning of 13 April, and establishing shell companies in Panama is legal for nationals of many African countries. However, when those entities are part of a scheme to misprice transactions deliberately or to evade tax, they are increasingly being picked up by African regulators and tax authorities. Driving those investigations are the effects of the commodity price crash, which has sharply cut state revenue in resource-rich countries and the campaign, led by South African ex-President Thabo Mbeki, to staunch the illicit financial flows from Africa (see Chart) which his United Nations-backed investigation says are running at over US$60 billion a year. The Paris-based Organisation for Economic Cooperation and Development reckons that illicit financial flows – deliberate trade mispricing and tax evasion – out of Africa are running at three times the level of foreign aid coming in.

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Ponyo plays banker

The Prime Minister has come within an ace of demolishing the fragile public confidence in the banking system

It's been a difficult three months for Prime Minister Augustin Matata Ponyo Mapon. Since his appointment three years ago, he has sought to build a reputation as a focused, high-ach...


Kabila delays, Katumbi hovers

Formerly the 'best man not standing', Moïse Katumbi wants to be sure of broad support before declaring for the presidency

As he edges towards announcing that he'll run for president, Moïse Katumbi Chapwe has been sounding out opposition groups about a joint strategy with himself at the head of a unity...



BLUE LINES
THE INSIDE VIEW

This year’s flurry of ostensibly competitive elections is prompting some activists to rethink their assessment of the forward march of democratic politics in Africa. After the unprecedented victory of the opposition presidential candidate in Nigeria, Africa’s biggest multi-party system, it seemed that the power of incumbent leaders to bend their countries to their will might be on the wane. Pro-democracy activists and oppositionists took heart.

This year’s flurry of ostensibly competitive elections is prompting some activists to rethink their assessment of the forward march of democratic politics in Africa. After the unprecedented victory of the opposition presidential candidate in Nigeria, Africa’s biggest multi-party system, it seemed that the power of incumbent leaders to bend their countries to their will might be on the wane. Pro-democracy activists and oppositionists took heart.

To judge by this year’s elections,  however, the political establishment is pushing back hard. In Congo-Brazzaville, Chad, Djibouti, Niger and Uganda, sitting presidents have changed national constitutions to prolong their tenure and to rig elections, either by blatant fraud or by blocking the campaigns of rivals. Their answer to new technology is simple: turn it off. So Presidents Yoweri Museveni, Denis Sassou-Nguesso and Idriss Déby – who have been in power for about three decades each – ordered cellphone companies to shut down their services. Déby and Sassou also shut down the internet.

Africa Confidential will look at these trends in more detail in the next issue but it is clear that the current anti-democracy wave is not anchored solely in personal ambition. Oppositionists are responding to tougher economic conditions with militant campaigns and regimes are exploiting fears of spreading instability and insecurity to crack down hard. The first victim is the people’s mandate.

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Desperately seeking dollars

The promise of $22 billion from Saudi Arabia will do little to alleviate the chronic shortage of foreign exchange

King Salman bin Abdul Aziz al Saud's 7-12 April official visit to Egypt celebrated economic closeness and demonstrated how open the kingdom's wallet was for aid, trade and investme...


Economy thwarts Buhari

Dilemmas over the exchange rate top a lengthening list of woes. The government turns to China for help

A year after the national boost from Muhammadu Buhari’s victory in the presidential election, the economic crisis is deepening, worsened by a combination of falling commodity...


Justice in question

The failure of the International Criminal Court's prosecutions against six high profile defendants raises doubts about the body's future as well as the role of the Kenyan authorities

The assessment by three judges at the International Criminal Court on 5 April that the prosecution's evidence against William Ruto, Kenya's Deputy President, and Joshua arap Sang, ...


Zuma's many foes mobilise

A campaign calling for Zuma's resignation is growing while his battle with opponents inside the ANC is undecided

The governing African National Congress (ANC) is under pressure from a wave of popular protest the like of which has not been seen since before the first free elections in 1994. Th...


Union at all costs

The CCM's determination to win the Zanzibar election has undermined stability by leaving the opposition out in the cold

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Rabat's Cold War manoeuvre

The kingdom is desperate to roll back a series of diplomatic setbacks over the Western Sahara and has the UN in its sights

Last month's visit to Moscow by King Mohammed VI had echoes of the political manoeuvres favoured by his late father, King Hassan II, who liked to play both sides in the Cold War ag...


A last blast for sanctions

During President Obama's final months in office, he should target sanctions more effectively at the Khartoum regime, argues a Washington lobby group

A new report from the United States-based, Africa-focussed Enough Project proposes that President Barack Obama's government should use a similar range of finely tuned financial and...



Pointers

Party pooper

President Ali Ben Bongo Ondimba's re-election campaign looks less of a cosmetic exercise now that National Assembly President Guy Nzouba Ndama has declared he will stand in the 28 ...


Guelleh opts for landslide

President Ismaïl Omar Guelleh won with a disputed 87% of the vote in the 8 April presidential poll. The leader of the opposition Union pour le salut national, Omar Elmi Khaireh, c...


Guptas fly out

The Gupta family has flown out of South Africa and relinquished all posts in their companies, despite strenuous denials that they were leaving for good. They threatened Africa Conf...


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