Shockwatch report: sub-Saharan Africa’s economic downturn and its impact on financial development

The current economic climate is causing a slowdown in financial development in sub-Saharan Africa. Credit is contracting, savings have declined, cross-border capital is less available and more costly, while indicators of financial soundness have deteriorated.

There have also been failures in governance of private and public institutions, including corruption and fraud that have deepened these problems. These have also undermined the public trust that is essential for long-term formal financial development.

Africa’s Hottest Frozen Border Boils Over

Some events come out of the blue, as surprising as thunderbolts. Others feel like confirmations of dour predictions, as grindingly inevitable as winter’s onset. The outbreak of heavy fighting between Eritrean and Ethiopian troops on their mutual border on June 12, which is reported to have left hundreds dead, falls into the latter category. No one should be surprised. And some mea culpas are in order.

The hidden heist – offshore plunder is hurting Africa

Forget the UK’s phoney political war over the offshore fund created by Prime Minister David Cameron’s late father. This is a Panama Papers sideshow that is diverting attention from a heist that is siphoning billions of dollars out of the world’s poorest countries in Africa, reinforcing poverty, undermining growth and facilitating corruption on an industrial scale.

Over the past fifteen years, Africa’s vast natural resource wealth has acted as a magnet for foreign investment. Much of that investment has been channelled through offshore centres, with the British Virgin Islands (BVI) the circuit of choice. Fortunes have been made. Elites have been enriched. But the minerals boom has done little to improve the lives of ordinary people.

East Africa’s pipeline politics in 2016

East Africa’s LAPSSET project remains at the volatile nexus of political and commercial dynamics with its short to medium term success increasingly unlikely.

East Africa’s aspirations for economic integration were intended to be catalysed through Kenya’s flagship LAPSSET project; however, it continues to face serious obstacles. The ‘mega-project’ is designed to serve as a regional transport corridor – improving trade between Uganda, Kenya, Ethiopia and South Sudan (excluding Tanzania) – complemented by a pipeline network which would improve its feasibility.

Power generation alone won’t deliver energy to Africa’s poor

 At the United Nations last week, the Secretary-General convened governments and civil society organisations to identify how to achieve Sustainable Energy for All (SE4ALL) by 2030. SE4ALL head Kandeh Yumkella rallied participants around the slogan ‘turning commitments into kilowatt hours for real people.’

The slogan was as stirring as the need is great. Energy poverty – lack of household access to a base level of electricity and quality of cooking – remains remarkably widespread. In sub-Saharan Africa alone 620 million people, or over two-thirds of the population, lack access to electricity; 730 million people, or 80% of the population, lack access to modern cooking services.

Africa’s Singapore Dream

Rwandans are wondering a lot about their president’s future these days. Paul Kagame (shown above) is nearing the end of his second term in office, and according to the constitution that means he won’t be able to compete in the country’s next national election, scheduled for 2017. Will he bend the rules to allow himself to stay on?

In his latest interview, the 57-year-old Kagame is careful to avoid revealing his intentions, saying that the decision is not up to him: “2017, I repeat, is the people’s business.” But there’s an intriguing hint right at the end, where the interviewer touches upon the recent death of Singaporean statesman Lee Kuan Yew, and asks Kagame whether he regards Lee as a model:

The Blood Cries Out

When Pierre Gahungu thinks about the small farm in the Burundian hills where he grew up and started a family, he remembers the soil—rich and red, perfect for growing beans, sweet potatoes, and bananas. He used to bend over and scoop up a handful of the earth just to savor its moist feel. To Gahungu, now in his 70s, the farm was everything: his home, his livelihood, and his hope. After he was gone, he had always believed, the land would sustain his eventual heirs.

Will the African Growth and Opportunity Act be renewed?

For many textile workers it is already well past midnight on the Africa Growth and Opportunity Act (AGOA) renewal. Apparel buyers plan nine months to two years ahead so uncertainty as to whether AGOA will renewed before 30 September 2015 means they have already lost business.

“I’ve heard from a few small and medium-sized companies that they have already started to pull out of AGOA factories. This is incredibly unfortunate, because many of those factories were just getting back on their feet after we went through the last-minute AGOA renewal in 2012,” Julia Hughes, President of the United States Fashion Industry Association (USFIA) said.

Boko Haram Turns Robin Hood’s Strategy on Its Head

 As a convoy of trucks carrying smoked fish cruised along the border of Niger and Nigeria last week, a Nigerien Air Force plane swooped low and opened fire, destroying the trucks and forcing the drivers to flee into Nigeria on foot.

The ill-fated fishmongers, Nigerien officials said, were collaborating with Boko Haram to sell their goods in Nigeria, despite Niger’s recent ban on cross-border fish trades. (Residents of Niger are called Nigerien; those from Nigeria are known as Nigerian). According to the Nigerien government, Boko Haram taxes goods transported through the territory the group controls to add to its cash reserves and finance terrorism, and the recent ban is intended to choke the Islamist group’s resources.

The Climate Wars Are Already Here

West Africa’s Niger River Basin, home to some of the poorest countries in the world, might be the bleeding edge of a new kind of conflict. Along Africa’s third-largest river, climate change and ballooning populations in Mali, Niger, and Nigeria — the three largest countries that rely on the waters of the Niger River — are driving a looming resource shortage, exacerbated by strained infrastructure, that risks pushing them past the breaking point. And research shows economic deprivation and environmental degradation may have already begun to take their toll, contributing to destabilizing much of the region and potentially threatening global security.

The trouble with budget transparency

Americans have a great term for a seemingly transparent government practice designed to be anything but.Document dumping is when a politician releases a piece of controversial information hidden amongst a swath of largely irrelevant documents, preferably at 5pm on a Friday or when a big news story is breaking.

While the information is in the public domain, it’s likely to remain far from the public consciousness – and the politician far from harm’s way. Bill Clinton was accused of a document dump in a 1996 controversy about campaign finances. George W. Bush was accused of employing similar tactics by releasing information on military spending in a late night Friday night ‘dump’.

Washington’s back-to-the-future military policies in Africa

 America’s new model for expeditionary warfare

Nick Turse

 

Lion Forward Teams? Echo Casemate? Juniper Micron?

You could be forgiven if this jumble of words looks like nonsense to you. It isn’t. It’s the language of the U.S. military’s simmering African interventions; the patois that goes with a set of missions carried out in countries most Americans couldn’t locate on a map; the argot of conflicts now primarily fought by proxies and a former colonial power on a continent that the U.S. military views as a hotbed of instability and that hawkish pundits increasingly see as a growth area for future armed interventions.

8 Maps that will change the way you look at Africa

You already know that Africa isn’t a country. But what else? Check out these maps and put the continent’s population, income, growth, and potential into context.

1. Where the world’s 7 billion live

U.S. and France: components of a renewed alliance

BY BARACK OBAMA AND FRANÇOIS HOLLANDE
 

Today, American and French diplomats are preparing for talks with Iran that build on the agreement that has halted progress on and rolled back key elements of the Iranian nuclear program. 

African demographic explosion to affect Med, Istat says

(ANSAmed) - ROME, JANUARY 29 - Africa's population is a demographic bomb waiting to explode, national statistics bureau Istat President Antonio Golini said Wednesday.

Record number of U.N. peacekeepers fails to stop African wars

The United Nations has dispatched a record number of peacekeepers in Africa in recent years, deploying soldiers to trouble spots such as the Central African Republic and South Sudan. Yet the “blue helmets” and thousands of other soldiers sent by African regional groups have failed to prevent fresh spasms of violence.

View Photo Gallery — In South Sudan, fears of a civil war: Fighting between loyalists of President Salva Kiir and backers of former vice president Riek Machar has triggered spasms of ethnic bloodletting across South Sudan. Peace talks between representatives of Kiir and Machar began Friday morning in the Ethiopian capital of Addis Ababa, according to the Ethiopian Foreign Ministry.

The peacekeeping forces have cost billions of dollars, largely paid by the United States and European nations. But they have been hobbled by weak mandates and a shortage of manpower and equipment. Some critics also say Washington, its allies and U.N. officials are at fault in the peacekeeping failures, for not following through with enough political pressure to prevent crises.

Governments who now worship Nelson Mandela once called him a terrorist

When Mandela wasn’t the messiah

Governments around the world, who now officially worship Nelson Mandela, once called him a terrorist and did deals with South Africa’s apartheid regime.

A Giant Awakens: Inside Africa's Economic Boom

Trade union members protest in a 2008 national strike against the South Africa's rising cost of living.

In roughly a decade, Africa has gone from being labeled "the hopeless continent" to enjoying an unprecedented boom. In a three-part series, SPIEGEL explores this transformation -- its drivers, winners and losers -- and asks if it can last.

Τhe magazine cover bore a completely black background. In the middle, an outline the shape of Africa framed a fierce-looking fighter toting a rocket-propelled grenade launcher. Above the picture was the title, "The hopeless continent."

Billions from Beijing: Africans Divided over Chinese Presence

By Bartholomäus Grill in Bagamayo, Tanzania

Tanzania is one of the focal points of the Chinese globalization strategy in Africa. In 2011, a large Chinese company invested $3 billion in coal and iron ore mines in the country. The enormous natural gas reserves off the Tanzanian coast -- an estimated 40 trillion cubic feet -- are of strategic interest. The China National Petroleum Company is currently installing a 532-kilometer (333-mile) pipeline from Mtwara, a port city in southeastern Tanzania, to Dar es Salaam.

China's 'Combat Troops' in Africa

For the second time in a little over a year, China has infantry on the ground in Africa, reflecting the Chinese military's increasingly global presence.

395 peacekeepers from the People's Liberation Army just arrived in the Saharan nation of Mali as part of the U.N. mission to help restore order there. Specifically, Beijing has sent engineering, medical and "guard" teams to the Malian capital of Bamako, according to the Chinese defense ministry. These troops are reportedly part of the PLA's 16th Army, a formation comprised of infantry, armor and artillery divisions.