John Campbell

Africa in Transition

Campbell tracks political and security developments across sub-Saharan Africa.

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Showing posts for "Economic Reform"

South Africa’s Currency Falls Again on Rumors of Finance Minister’s Arrest

by John Campbell
South African Finance Minister Pravin Gordhan gestures during a media briefing in Sandton near Johannesburg, March 14, 2016. (Reuters/Siphiwe Sibeko) South African Finance Minister Pravin Gordhan gestures during a media briefing in Sandton near Johannesburg, March 14, 2016. (Reuters/Siphiwe Sibeko)

On May 15, the Sunday Times (English, Johannesburg) published rumors of the impending arrest of Finance Minister Pravin Gordhan over alleged revenue service irregularities. However, on May 16, Beeld (Afrikaans, Johannesburg) reported that President Zuma denied the Sunday Times report. Nevertheless, the South African national currency, the rand (ZAR), fell the following two days, reaching its weakest level in two months; it has fallen 2.1 percent against the U.S. dollar since March 15. Read more »

Africa Returns to the Markets

by Guest Blogger for John Campbell
Nigerian naira notes are seen in this picture illustration, March 15, 2016. (Reuters/Afolabi Sotunde/Illustration) Nigerian naira notes are seen in this picture illustration, March 15, 2016. (Reuters/Afolabi Sotunde/Illustration)

This is a guest post by Allen Grane, research associate for the Council on Foreign Relations Africa Studies program.

In early April, South Africa issued its first sovereign bond in over two years. The ten-year, $1.25 billion bond was oversubscribed by a factor of two. This is the first international bond issued by a sub-Saharan African nation in 2016. It is likely to be followed by Kenyan, Nigerian, and Ghanaian issuances. Read more »

The Year China Solidifies the Renminbi’s Place in Africa

by Guest Blogger for John Campbell
Chinese President Xi Jinping, accompanied by his wife wife Peng Liyuan, walks with South African President Jacob Zuma upon his arrival at the Union Buildings in Pretoria, December 2, 2015. (Reuters/Sydney Seshibedi) Chinese President Xi Jinping, accompanied by his wife wife Peng Liyuan, walks with South African President Jacob Zuma upon his arrival at the Union Buildings in Pretoria, December 2, 2015. (Reuters/Sydney Seshibedi)

This is a guest post by John Causey, a private equity and transaction advisor with a focus on sub-Saharan Africa.

The U.S. dollar’s dominance in sub-Saharan Africa is no longer certain. Despite the current volatility of the Chinese renminbi an auspicious moment may exist for China’s currency to challenge the dollar’s hegemony in the region. Read more »

IMF Managing Director Lagarde’s Visit a Boost for President Buhari

by John Campbell
Nigeria's President Muhammadu Buhari and International Monetary Fund (IMF) Managing Director Christine Lagarde attend a meeting in Abuja, Nigeria, January 5, 2016. (Reuters/Afolabi Sotunde) Nigeria's President Muhammadu Buhari and International Monetary Fund (IMF) Managing Director Christine Lagarde attend a meeting in Abuja, Nigeria, January 5, 2016. (Reuters/Afolabi Sotunde)

President Muhammadu Buhari faces a serious economic crisis related to the plunge in the world price of oil, slow rates of economic growth, the prospect of rising American interest rates, a falling national currency, and declining government revenues. At the same time, he is working to restructure the economy away from undue dependence on oil by increasing infrastructure investment and vigorously pursuing an anti-corruption agenda demonstrated by the arrests of high-profile public figures. Read more »

Advancing African Development Through Intra-Continental Trade

by Guest Blogger for John Campbell
(L-R) South Africa's President Jacob Zuma, Senegal's President Macky Sall and Rwanda's President Paul Kagame participate in a panel discussion on the future of Africa during the U.S.-Africa Business Forum in Washington,  August 5, 2014. (Reuters/Jonathan Ernst) (L-R) South Africa's President Jacob Zuma, Senegal's President Macky Sall and Rwanda's President Paul Kagame participate in a panel discussion on the future of Africa during the U.S.-Africa Business Forum in Washington, August 5, 2014. (Reuters/Jonathan Ernst)

This is a guest post by Fily Camara, an intern for the Council on Foreign Relations Africa Program. He is a masters candidate at New York University.

Intra-African trade has been only eleven percent of the continent’s total trade over the last decade. By comparison, more than sixty percent of Europe’s trade is intra-continental. The equivalent figure for North America is about 45 percent and for Asia it is about twenty-five percent. The small scale of Africa’s intra-continental trade reflects the continent’s dependence on foreign markets for the vast majority of their trade relations. African policymakers, as well as their Western counterparts, have long acknowledged the need for more intra-continental trade. It is a paradox that, for much of Africa’s postcolonial history, it has been a pioneer in regional integration. In addition to the African Union (AU), there are eight, smaller regional economic communities—many of which have successfully implemented common currencies and external tariffs in addition to cooperating on matters of security and justice. Nevertheless, commerce among countries in Africa remains low, with significant negative development ramifications. Read more »

The South African Roller Coaster

by John Campbell
South Africa's President Jacob Zuma speaks during his visit to the Lodewyk P. Spies Old Age Home in Eersterust, Pretoria, December 15, 2015. (ReutersS/Siphiwe Sibeko) South Africa's President Jacob Zuma speaks during his visit to the Lodewyk P. Spies Old Age Home in Eersterust, Pretoria, December 15, 2015. (ReutersS/Siphiwe Sibeko)

On December 10, President Jacob Zuma fired Nhlanhla Nene, the well regarded finance minister, and replaced him with the unknown and inexperienced David van Rooven. Though Zuma is not required by the South African constitution to consult with anybody on cabinet appointments, the fact that he did not inform his cabinet or provide public explanation for his removal of Nene and appointment of van Rooven may have been the last straw. Read more »

Africa Taps Global Bond Markets at Rapid Rate

by Guest Blogger for John Campbell
Stockbrokers trade on the floor of the Zimbabwe Stock Exchange (ZSE) in Harare, February 24, 2015. (Courtesy/Philimon Bulawayo) Stockbrokers trade on the floor of the Zimbabwe Stock Exchange (ZSE) in Harare, February 24, 2015. (Courtesy/Philimon Bulawayo)

This is a guest post by Aubrey Hruby and Jake Bright. They are the authors of The Next Africa: An Emerging Continent Becomes a Global Powerhouse.

Sub-Saharan African governments are tapping global capital markets at a rapid pace, issuing $18.1bn in dollar denominated eurobonds from 2013-2015, nearly triple the $7.3bn issued in the previous three years. Read more »

Kenya’s Silicon Savannah Spurs Tech in Sub-Saharan Africa

by Guest Blogger for John Campbell
A Somali man browses the internet on his mobile phone at a beach along the Indian Ocean coastline in Somalia's capital Mogadishu, January 10, 2014. (Reuters/Feisal Omar) A Somali man browses the internet on his mobile phone at a beach along the Indian Ocean coastline in Somalia's capital Mogadishu, January 10, 2014. (Reuters/Feisal Omar)

This is a guest post by Aubrey Hruby and Jake Bright. They are the authors of The Next Africa: An Emerging Continent Becomes a Global Powerhouse.

The role of technology in sub-Saharan Africa is growing. An emerging information technology (IT) ecosystem is reinforcing regional trends in business, investment, and modernization. There is a growing patchwork of entrepreneurs, startups, and innovation centers coalescing from country to country. Read more »

Arrests for Nigerian Corruption Begin

by John Campbell
A man arrives at the first annual summit of the newly launched anti-corruption group "Buharian Culture Organization" in Abuja, Nigeria, August 28, 2015. (Reuters/Stringer) A man arrives at the first annual summit of the newly launched anti-corruption group "Buharian Culture Organization" in Abuja, Nigeria, August 28, 2015. (Reuters/Stringer)

Last week, the British authorities arrested former oil minister Diezani Alison-Madueke for corruption, bribery, and money laundering. She has been released on bail. Often lauded as “among Africa’s most powerful women,” she was the first female Nigerian Minister of Petroleum, and the first female President of the Organization of Petroleum Exporting Countries (OPEC), a position she currently holds. Read more »

Foreign Investors Cautious About Nigeria

by John Campbell
A trader changes dollars with naira at a currency exchange store in Lagos, February 12, 2015. (Reuters/Joe Penney) A trader changes dollars with naira at a currency exchange store in Lagos, February 12, 2015. (Reuters/Joe Penney)

International investors may be demoting Nigeria as their darling. JPMorgan Chase & Co. is excluding Nigeria from its local-currency emerging-market bond indices. (A local-currency emerging-market bond is one that is purchased in the local currency, in this case the naira, instead of the dollar. This means that the bonds are affected by any local currency fluctuations.) According to Forbes, JPMorgan Chase will remove Nigerian debt from its indices by the end of October. In response to the JPMorgan Chase announcement, the Nigerian All-Share index fell by almost 3 percent, while the benchmark 2024 bond yield rose by 40 basis points to 17 percent. Read more »