Thursday, 26 May 2016

Thinking big

Taking over the presidency of the African Development Bank from Rwanda's Donald Kaberuka, whose combination of political savvy and straight talking on economics put the Bank back on the global map, was always going to be tough. The tenure of new President Akinwumi Adesina started last year at the end of the commodity super-cycle as the continent's growth levels fell to their lowest for 15 years.

That's not an inheritance that is likely to slow down Adesina, a workaholic and relentless networker, who opened the AfDB's annual meeting in Lusaka on 25 May with the battle cry: 'Africa must think big, act big and deliver big.' With its theme of 'Energy and Climate Change', the meeting attracted the heads of state of Kenya, Rwanda, Chad  and Zambia, the host.

At the opening discussion to launch the Jobs for Youth campaign, Bank officials circulated research showing that of the 10-12 million young Africans who join the labour market each year, less than a quarter find jobs in the formal sector. Carlos Lopes, head of the UN Economic Commission for Africa, said there was a mismatch between Africa's education and the skills needed to transform its economies. Just under 3 million people emigrate from Africa each year, that's half the rate of people leaving China, Lopes said, arguing against media images of a tidal wave of migrants. The difference, he said, was that China was equipping its youth with the skills they needed to compete in the global economy.

Tuesday, 17 May 2016

West in talks to fight Da'ish and consolidate new Tripoli regime

This week starts with talks on Libya's crisis in Vienna and negotiations in Nigeria over the fuel price increase. Kenya's government makes further moves to close down the world's biggest refugee camp and Uganda's most prominent opposition leader is held on treason charges. A claim that South Africa's President Jacob Zuma wants to arrest finance minister Pravin Gordhan unnerves markets and conditions worsen further in Gambia.

LIBYA: West in talks to fight Da'ish and consolidate new Tripoli regime
As they meet in Vienna to map out plans to counter Da'ish's (or ISIS) growing presence in Libya, Western ministers will pressure politicians they see as undermining the United Nations-backed Government of National Accord in Tripoli. The new government is seen as a critical bulwark against Da'ish's efforts to expand its power in the country.

Its Prime Minister, Faiez el Serraj, is to ask for arms and intelligence from the United States and European governments, who have deployed Special Forces soldiers across the country. Serraj is struggling to impose his authority as politicians in the Tripoli parliament refuse to back him while he still faces outright opposition from the self-proclaimed government in Tobruk, eastern Libya. The Vienna talks will be chaired jointly by Italy's Foreign Minister Paolo Gentiloni and US Secretary of State John Kerry.

NIGERIA: Buhari's officials in crisis talks over fuel prices as queues lengthen
Fuel scarcity could worsen as the country's two leading workers' organisations – the Nigeria Labour Congress and the Trade Union Congress – threaten a national strike following a government plan, announced on 13 May, to raise prices by over 60%. If the plan isn't withdrawn, union officials say, the strike will begin on Wednesday. However, the just-approved national budget for 2016 doesn't include any allowance for fuel subsidies. That was one of the reasons behind last week's price hike and will complicate any negotiations between the government and the unions. In addition, fuel importers have been complaining they can't raise the dollars to buy gasoline from the flotilla of tankers lining up in Nigerian waters hoping for business.

KENYA: Government reiterates plan to close Dadaab camp
Although President Uhuru Kenyatta's government has not set a precise deadline on its planned closure of the Dadaab refugee camp, housing more than 350,000 people, it says it will start expulsions of refugees as soon as possible. It has already announced the closure of its Department of Refugee Affairs which has been operating as a liaison office for the Dadaab camp.

The government has been forced into the closure because of 'international neglect', according to a spokesman from the Interior Ministry, adding that means Kenya has to accommodate more than 600,000 refugees within its borders and their presence is exploited by terrorist groups. United Nations officials have responded diplomatically, calling Kenya 'a leading beacon in the region for international protection' in public while privately pleading with the government not to go ahead because it fears a humanitarian catastrophe could result.

UGANDA: Kizza Besigye on treason charge as opposition steps up protests
Supporters of opposition leader Kizza Besigye, now being held in Moroto near the border with South Sudan after being charged with treason, have vowed to intensify their campaign against President Yoweri Museveni's government. They claim Museveni's February re-election as president was massively rigged.

Security officials arrested Besigye on 11 May after a mock inauguration ceremony was organised to swear him in as president. The fake ceremony was particularly embarrassing to Museveni, as it took place the day before his official presidential inauguration.

In a sign of deteriorating diplomatic relations, several Western ambassadors walked out of Museveni's inauguration speech after he referred to the International Criminal Court as a 'useless organisation'. He has also made a point of inviting Sudan's President Omer Hassan el Beshir, indicted by the ICC on genocide charges, to the inauguration.

SOUTH AFRICA: Claims that Zuma plans to arrest finance minister rattle markets
Frantic denials by President Jacob Zuma's office of a press report on 15 May that the arrest of Finance Minister Pravin Gordhan was planned has failed to calm markets. The rand fell to a two-month low against the dollar and interest rates on government bonds rose sharply today.

The reports carried in the mass circulation Sunday Times had said a special police unit, the Hawks, was waiting for approval from Zuma to arrest Gordhan for his role in setting up a surveillance unit to track down tax evaders.

A proxy battle between Gordhan and Zuma, who appointed some key loyalists to run the Hawks unit, has been rumbling over recent months. Some of the irregularities discovered by the surveillance unit are thought to relate to Zuma's personal business affairs.

GAMBIA/SENEGAL: Little progress on border talks as Jammeh cracks down harder on dissidents
Banjul's political and economic crisis looks set to worsen after initial talks between Gambian and Senegalese officials on reopening their mutual border, closed for three months, have made little progress. A joint statement issued today said that talks would resume no later than the end of July but that could further damage the economic situation in Gambia.

Over 40 activists from the opposition United Democratic Party are being held and protests are growing increasing despite violence meted out by security officers. On 15 May, the police charged six women with unlawful assembly and inciting violence against President Yahya Jammeh's regime. In power for 22 years, accused of killing oppositionists and grand corruption, Jammeh is facing his most serious threat to date.

Thursday, 12 May 2016

Conventions of anti-corruption

The big problem with the Anti-Corruption Summit organised by British Prime Minister David Cameron on 12 May was that no one could agree on what it was for. It invited Nigeria's Muhammadu Buhari, Colombia's Juan Manuel Santos Calderón and Afghanistan's Ashraf Ghani Ahmadzai, as well as United States' Secretary of State John Kerry, but not the leaders of Ghana, Kenya, South Africa, Brazil or China, who all preside over chronic corruption problems.

Cameron's critics accused him of trying to divert attention from the embarrassing revelations that his family had benefited from offshore banking arranged by Mossack Fonseca, the Panama law firm whose computer files have been hacked and distributed to sundry journalists. In fact, Cameron's conference was planned long before the Panama Papers were published in April but the revelations have reinforced demands for more surveillance and tougher regulation. As Transparency International said at a conference organised by the Commonwealth on 11 May, with tax havens based in its overseas territories and crown dependencies, Britain is widely seen as providing a warehouse for corrupt assets.

Next month, Britain is to become the first major economy to make public the beneficial owners of companies registered in its territories but the list will not include all the secrecy jurisdictions and dependencies, such as the Isle of Man, Jersey and Guernsey, let alone the British Virgin Islands.

Wednesday, 4 May 2016

Warnings on economic slowdown and policy shifts

This week there are some sobering warnings from the IMF and some rambunctious election-campaign launches in South Africa. Pressure continues to increase on Nigeria's President Buhari to devalue the naira or set up a new exchange rate for specified transactions, while the UN Security Council votes to extend the troubled peacekeeping mission to the Western Sahara. Gambian President Yahya Jammeh's latest crackdown on his opponents, during which three militants have been killed in gaol, could prompt more serious external measures against his regime.

INTERNATIONAL MONETARY FUND: Warnings on economic slowdown and policy shifts
African countries should change their policies if they are to halt slowing economic growth, which could fall to an average of 3% this year, according to the latest World Economic Outlook from the International Monetary Fund published on 3 May. This is the lowest level of growth in Africa for nearly two decades.

Oil and minerals exporters, along with drought-hit countries in Eastern and Southern Africa, have been the hardest hit. An upturn to 4% is possible next year, says the Fund, if governments adopt some tough adjustment policies and the market for African commodities improves.

Only those spending heavily on infrastructure – such as Côte d'Ivoire, Kenya and Senegal – are bucking the trend with growth at over 5%.

SOUTH AFRICA: After the manifesto launches, the May Day rallies
The wave of election manifesto launches around May Day pointed to a changing political landscape as the governing African National Congress counted the cost of Jacob Zuma's leadership. Three weeks earlier, the ANC had launched its manifesto, at a poorly attended rally in Port Elizabeth, as it gears up for the local elections in August.

Left-wing organisations, led by the Economic Freedom Fighters and Zwelenzima Vavi's Workers' Summit, hope to take advantage of the ANC's falling support. More then 50,000 supporters, about double the number that turned out for the ANC manifesto launch, flocked to the EFF's campaign rally at Orlando stadium in Soweto. Vavi and fellow union leaders lambasted the pro-Zuma Congress of South African Trade Unions for betraying workers and failing to expose corruption.

And from the right, Mmusi Maimane's Democratic Alliance launched its manifesto – 'Moving South Africa Forward Again'- in Johannesburg with lots of respectful references to Nelson Mandela and disrespectful remarks about Zuma. As all three party leaders spelled out their policies, their advisors were telling journalists that the ANC will get a bad shock in the August local elections. But they are saying little about the backroom deals they will have to do if they are going to wrest control of some of the country's biggest municipalities from the ANC's still formidable grip.

MOROCCO/WESTERN SAHARA: Vote backs full restoration of UN mission on dispute
The blazing row between King Mohammed VI's government and UN Secretary General Ban Ki-moon is set to worsen after the UN Security Council voted on 29 April to renew its peacekeeping mission in Western Sahara for a year.

After Ban used the word 'occupation' to refer to Morocco's presence in the Western Sahara in March, Morocco launched a diplomatic offensive against him and expelled several UN personnel. The UNSC resolution was a messy compromise drafted by the United States. It fails to set out any penalties for Morocco if it does not rescind the expulsion of UN staff.

NIGERIA: Buhari to sign budget as currency pressure grows
After months of argument between the presidency and the National Assembly over the size and scope of the 2016 budget, President Muhammadu Buhari is due to sign it this week, and the government will start fresh disbursements to the cash-starved economy.

But Buhari can expect no respite on pressure for more flexibility on the exchange rate policy, if not a full devaluation. Repeating his earlier calls for a rethink on the exchange rate, Sanusi Lamido Sanusi, former Governor of the Central Bank of Nigeria and now Emir of Kano, told a group of diplomats, businesspeople and journalists in Paris on 2 May that the government should consider introducing a 'second tier' rate for the naira for non-essential imports.

The official exchange rate stays at N197=US$1 while the parallel market rate has been wavering around N320=$1 over the past week. The second-tier rate, a proposal backed by many bankers in Lagos, would set a new rate somewhere in between those two levels.

GAMBIA: More killings of oppositionists as regional pressure mounts
Might the latest round of killings, arbitrary detentions and provocations of neighbouring states finally trigger serious action against President Yahya Jammeh? Solo Sandeng, the leader of the youth wing of the United Democratic Party Opposition, was tortured and killed in custody last month and activists threaten to step up protests. Two other activists have died in custody, say the UDP, and the party's leader, Ousman Darboe, is still in detention without charge.

Belatedly, the political repression in Gambia is getting some foreign attention although Jammeh has fought off any attempt to raise the abuses at the African Union. That could change this year after relations with Senegal worsened. Jammeh's security men detained a group of Senegalese trade officials last month after sporadic closures of the border between the two countries over the past year. After diplomatic pressure Senegal's officials were released. Human rights activists in Accra and beyond are still demanding answers from Jammeh about the detention and murder of 44 Ghanaian fishermen in Gambia in 2005. So far they have been met with a deafening silence from Jammeh in Banjul.