On Saturday, March 21, Namibia embarks on a fresh course that seems set to boost the country. The date marks Independence Day – it will be exactly 25 years after Namibia lowered the apartheid flag over its territory and ushered in change that would ultimately impact the entire region and help end racial domination in South Africa.
Fitch Ratings affirmed Zambia’s sovereign credit risk rating in a report dated March 13, although the outlook was revised due to policy coherence and credibility concerns. Fitch affirmed Zambia’s long-term foreign and local currency Issuer Default Ratings (IDRs) and senior unsecured foreign and local currency bonds at “B”, while the outlook on the IDRs was revised from positive to stable. The revision captures Fitch’s view that policy coherence and credibility “are weak and a growing constraint on the rating”.
It’s no secret that sub-Saharan Africa has seen significant growth over the last decade. There may have been bumps on the road, but the trend is set to continue. The US private equity group, Carlyle is a case in point. In April of last year it closed its maiden private equity fund focussed on sub-Saharan Africa at nearly $700m, 40% above target. Last November, it announced its first investment in Nigeria, taking an 18% stake in Diamond Bank. And, the same week saw another first for Carlyle, this time in South Africa, where it acquired TiAuto in a deal thought to be worth about $182m.
Although the recent experience in Nigeria is a reminder that the high rewards investors seek in Africa tend to be accompanied by elevated levels of risk, the long-term outlook for African markets remains positive, says Johan Steyn, Portfolio Manager at Prescient Investment Management.
China’s investment in African resources remains at a relatively early stage and is likely to increase further over the next decade, despite the economic slowdown being experienced in the world’s second largest economy, says George Fang, Standard Bank’s Beijing-based Head of Mining and Metals in Asia.
Musa Manyathi, Director of International Tax at Deloitte South Africa, explores the tax related challenges that South African companies face when looking to invest into the African continent.
The reintroduction of capital gains tax (CGT) faced severe criticism, with many analysts indicating it could impact investment in equities and the real estate, oil and mining sectors, says Michael Kimondo, Head of Treasury Operations at Fusion Group.
Nigeria’s election dates have been postponed by six weeks. The presidential and Federal National Assembly elections, which had been scheduled for Saturday, February 14, will now take place on March 28, and the elections for state governors and state assemblies, originally set for February 28, will now happen on April 11.
The civil war that erupted in South Sudan in December 2013 has devastated the country, and has had detrimental economic and, more importantly, social consequences across the East Africa region. Almost two million people have been displaced by the violence, and although there is no official death toll, the International Crisis Group estimates the figure could be between 50,000 and 100,000 people.
A growing body of evidence suggests that financial institutions and financial markets exert a powerful influence on economic development, poverty alleviation, and economic stability, says Martin Čihák, lead economist at the World Bank.
