Structural factors, recent news and upcoming events give reason to believe that Nigeria is about to take a liberal turn on policy. The most important structural factors are the catastrophic state of public finances and the naira’s unsustainable strength on the official currency market. Important recent news has included President Muhammadu Buhari’s sacking of the governing bodies of a number of federal agencies and parastatals, and the recommendations of Ahmed Joda’s transition committee. And the main event is the president’s current visit to the US, and his meetings with top US officials in Washington.
The news out of Zimbabwe remains dismal, but a subtle shift in the ruling party’s rhetoric has awakened some contrarian interest in the global investment community. It may be time to take some cautious steps back onto the beleaguered nation’s stock exchange.
In the last 10 years Zambia has enjoyed a relatively stable economic growth, with a real GDP growth (2005 – 2013) of more than 6% year-on-year. The country achieved relative macro-economic stability and in 2011 was reclassified by the World Bank as a middle-income country. Investor confidence has been high, as evidenced in the successful issue of two Eurobonds, and a burgeoning mining industry.
Travelling around the African continent's big cities Abuja, Nairobi, Johannesburg, and Cape Town one can spot a similar trend in these cities. The most notable is the number of construction sites that are mushrooming in almost every corner.
A new double tax treaty between South Africa and Mauritius will allow South Africa to tax some repatriations of profit on investments in South Africa structured through a Mauritian holding company, according to Eloise Walker, a tax expert at Pinsent Masons, the law firm behind Out-law.com.
When the World Economic Forum (WEF) released its 2015 Africa Competitiveness Report earlier this month, a familiar name topped the ranking. The study found Mauritius to be Africa’s most globally competitive economy and put it in 39th place worldwide – well ahead of Russia, Brazil, and India – suggesting that it stands a good chance of growing quickly over time.
More workable and pragmatic models for project finance are helping improve the pace of projects in Africa and remove some of the bottlenecks that existed previously.
In the fog of confusion caused by the chaos at Eskom, we lose sight of where the ANC government has done really well in the area of power generation. Perhaps this could provide a model to get out of the morass that we are in that is dragging the whole economy down.
If I look at the make-up of our Africa portfolios, or the make-up of the various Africa stock indices for that matter, what often stands out is the relative simplicity of the underlying businesses. From brewers, to banks, from cement companies to cocoa plantations, construction firms to home builders, and power producers to hotels. This should come as no surprise. Africa is playing catch-up, which is very much a desirable, necessary, and investable economic phenomenon. These types of businesses form the root system from which a more complex economy can grow.
Lack of access to affordable trade finance is holding back the economic and employment potential of African countries, says Vinod Madhavan, Head, Transactional Products and Services, South Africa at Standard Bank.
Over the past decade, the African continent has been experiencing an increase in inter-regional integration led by both trade and corporate expansion. In particular, many North African companies are now looking beyond their borders to Sub-Saharan Africa for new business opportunities in many sectors, including financial services, telecommunications and technology, and fast moving consumer goods (FMCG).
South Africa can expect the franchise industry to continue to provide solid growth in the future, says Gerrie van Biljon, executive director of Business Partners (BUSINESS/PARTNERS).
