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Published 22nd November 2013

Vol 54 No 24


Nigeria

Small earthquake, President slightly hurt

Image courtesy of Panos Pictures
Image courtesy of Panos Pictures

Image courtesy of Panos Pictures

Disarray and defections are undermining the governing party and the President but don’t yet put the opposition clearly in the lead

The defection of five state governors from his party to the new opposition alliance on 26 November can hardly have surprised President Goodluck Jonathan, who has been procrastinating over the growing political crisis for the last four months. The most generous interpretation is that he was torn between the vengeful faction of the governing People’s Democratic Party (PDP) under National Chairman Bamanga Tukur, who wanted the toughest sanctions against party dissidents, and more tactical operators such as former President Olusegun Obasanjo, who wanted to tie the rebels up in tortuous negotiations about reconciliation. In the end, it may be that Jonathan and his party provoked the defections more by accident than design.

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Deficit blues

Tough times are looming after years of high growth and political stability in an oil and gold producing economy

The harsh realities behind Finance Minister Seth Terkper’s budget speech on 19 November suggest a turbulent year ahead for the government. Officials recommend some tough and ...


Koroma’s legacy

The President’s biggest promise was to renew the country’s infrastructure but criticism of his record is growing, especially on roads and power

Nothing that President Ernest Bai Koroma has promised since coming to power in 2007 has excited as much hope as his pledges to improve the parlous state of the roads and energy sup...



BLUE LINES
THE INSIDE VIEW

As more African countries join the ranks of middle-income states and lose their eligibility for concessionary loans, their financing needs are being met by bond issues, local and foreign direct investment, domestic taxation and customs revenue. Yet there are big risks in the new financial landscape. Nearly a quarter of Africa’s 54 countries have floated Eurobonds: Angola, Côte d’Ivoire, Gabon, Ghana, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Seychelles, South Africa and Zambia. Most...
As more African countries join the ranks of middle-income states and lose their eligibility for concessionary loans, their financing needs are being met by bond issues, local and foreign direct investment, domestic taxation and customs revenue. Yet there are big risks in the new financial landscape. Nearly a quarter of Africa’s 54 countries have floated Eurobonds: Angola, Côte d’Ivoire, Gabon, Ghana, Mozambique, Namibia, Nigeria, Rwanda, Senegal, Seychelles, South Africa and Zambia. Most wanted to take advantage of the historically low interest rates and improving perceptions of Africa’s economies. They borrowed on better terms than Greece or Portugal but few think this era of low-cost borrowing is sustainable in the medium term.

Borrowing costs are determined mostly by the international ratings agencies, whose shortcomings prior to the West’s financial crisis in 2008 have been well rehearsed. If they don’t understand the industrial economies for which they have full financial data, it’s a safe bet that, with some exceptions, their grasp of African economies is still more deficient. Yet these agencies, with their capacity to downgrade or upgrade sovereign risk ratings of economies, will determine the costs and even the availability of borrowing. More independent analysis could improve the quality of assessment. Perhaps it is time for Africa to launch its own ratings agency, backed by the African Development Bank and perhaps in partnership with another international agency.
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Two divided houses

The opposition Sierra Leone People’s Party is still struggling to find its feet in spite of a series of political and economic slips by the governing All People’s Congr...


Frelimo unnerved

The governing party won the polls but the MDM shows signs of growing into a serious political challenge

The governing Frente de Libertação de Moçambique and President Armando Guebuza emerged from the local elections on 20 November still in power nationwide. Yet c...


Concern over contract-farming

Debate on how to address land conflicts and poverty in rural Tanzania is intensifying. Last year, the New Alliance for Food Security and Nutrition grew out of the Group of Eight meeting in May. Critics say the Alliance is more about providing access to untapped markets in Africa for global corporate giants such as Vodafone and Monsanto than helping to streamline agriculture or free smallholders from poverty. The G-8 has promised to lift 50 million of the world’s people out of ‘extreme poverty’ by 2022 and its key vehicle for boosting agricultural production is private investment

Tanzania was among the first six countries to sign up to the New Alliance for Food Security and Nutrition, along with Burkina Faso, Côte d’Ivoire, Ethiopia, Ghana and M...


The Atlantic ports puzzle

Kinshasa cannot decide whether to develop its own outlet to the Atlantic or depend on Brazzaville. It’s all about geopolitics and special interests

Congo-Kinshasa has a small port, Matadi, while Congo-Brazzaville has a much larger one, at Pointe-Noire. The Kinshasa government needs to decide between them. There are rival views...


Mugabe's farm in sanctions row

The President and his wife run a dairy business. A German firm has been supplying them for four years, even though the couple are under EU sanctions

The German firm Wilhelm Guth Ventiltechnik has been supplying components to Robert and Grace Mugabe's dairy in defiance of international sanctions. Its wholly-owned subsidiary, Gut...


Political class in turmoil

The Cashgate scandal is roping in most politicians in a storm of corruption so severe that donors have halted aid payments

The reputations of almost all members of the political establishment – with the possible exception of the opposition United Democratic Front – have been severely batter...



Pointers

Luanda cows Lisbon

Portugal appears to have succumbed to Angolan pressure to drop more investigations of top officials in Luanda. Last week, the Portuguese Central Investigation and Criminal Prosecut...


Carter’s quiet doubts

Eight-and-a-half months after Kenya’s Independent Electoral and Boundaries Commission declared Uhuru Kenyatta winner of the March 2013 presidential poll, a key electoral obse...


Katti goes for gold

Knowledge Katti, the oil exploration millionaire and close associate of Prime Minister Hage Geingob, appears to be on the verge of another business coup. Katti represents one of tw...


Kampala ousts mayor

A thorn in President Yoweri Museveni’s side was removed when Kampala City Council voted to depose the Lord Mayor, Ssalongo Erias Lukwago, of the opposition Democratic Party o...