🔅 Ethiopian Airlines' High-Flying Rebound
Today’s Issue: Japan’s support for the African Union, the ANC’s re-election of Cyril Ramaphosa, and DRC's flood toll keeps getting worse... ☕
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Photo of the day: Guinea Bissau
Markets:
🔺 Nigerian SE: 49,414.96 (+0.20%)
🔺 Johannesburg SE: 73,366.32 (+0.52%)
— Ghana SE: 2,449.78 (0.00%)
🔺 Nairobi SE: 128.63 (+0.11%)
🔻 US S&P 500: 3,848.30 (-0.11%)
🔻 Shanghai Composite: 3,107.12 (-1.92%)
*Data accurate as of the close of markets across the continent
World Cup: Winning the World Cup is the ultimate “W” for any soccer team, but it turns out it’s also a win for their country’s economy. Studies have shown that the world champion experiences an extra 0.25% economic growth in the two quarters after the tournament. Just making it to the quarter-finals can boost exports, which is good news for Morocco, this year's surprise semifinalists. Argentina could use the good news, considering 40% of the population lives in poverty and inflation is expected to hit triple digits this year.
Ghana & Rwanda: Ghana is in a tight spot, and it’s getting tighter. The country’s government just announced suspending payments on some of its external debt, including Eurobonds and commercial loans. This is all part of Ghana’s attempt to handle its massive debt burden—public debt stands at $55 billion and the country’s been spending between 70 and 100% of its revenue on interest payments. Meanwhile, the IMF has approved $319 million for Rwanda to help the country cope with climate change and other prolonged risks.
ECONOMY
Ethiopian Airlines' High-Flying Rebound
What's the story?
Africa’s biggest airline is about to get a lot bigger. Ethiopian Airlines is shooting for the stars, aiming to grow its fleet and network.
The carrier will transport 12.7 million passengers during the year, up from 12.1 million before the pandemic struck.
The forecast is attributed to the lifting of restrictions and growth in terms of its fleet and destinations, as well as newfound peace in the north of the country.
So how big is it betting?
The company is aiming to grow revenue and passengers by 400% and 440%, respectively, by 2035. That’s quite the ambition for the carrier that’s already seen much success during the pandemic, thanks to its cargo business.
It will also order new planes from Boeing and Airbus, doubling its size to 271. "Unless we grow, we cannot be successful," Mesfin Bekele, the CEO, said.
It’s also looking to start new routes to Singapore, Kuala Lumpur, Karachi, Copenhagen, and Atlanta, and is in talks with the Nigerian and Congolese governments to create national airlines in both countries.
CEO Mesfin Tasew Bekele said that it’s all part of the airline’s mission to grow, grow, grow.
What's the catch?
Mesfin said that delays in re-opening China Covid-wise could curb their projections since it’s a key market for passengers and cargo.
ACROSS THE CONTINENT
Other Headlines
🇿🇦 After a weekend of voting, the African National Congress party reelected Cyril Ramaphosa as its leader. Despite some major scandals, including a damning parliamentary report that said he might have broken anti-corruption laws by hiding undeclared dollars in cash at his farm, Ramaphosa won the vote against former Health Minister Zweli Mkhize by 2,476 votes to 1,897. The victory means Ramaphosa can run for a second term as South Africa’s president in 2024, but he and the newly elected ANC leadership have a lot of work to do between now and then. The country’s been dealing with crippling power cuts, an unemployment rate of 35%, and a pandemic, to name a few. At the opening of the ANC’s crucial leadership conference, Ramaphosa admitted his government was partly to blame for the electricity crisis and promised to buy more renewable energy. He also vowed to fight corruption, even as he was embroiled in his own scandal. As for his deputy, Paul Mashatile, the party’s outgoing treasurer-general, was reelected.
🇯🇵🇸🇳Japan is showing Africa some love. Prime Minister Fumio Kishida announced Monday that Japan is throwing its weight behind the African Union’s entry into the G20, the club of the world’s 20 largest economies. Kishida also met with Senegalese President Macky Sall in Tokyo to discuss beefing up economic ties between Japan and Senegal. Kishida said the African Union’s inclusion in the G20 was critical because African countries are playing an increasingly important role in the global economy. Japan also pledged to support Senegal in developing its resources and encouraging Japanese businesses to invest there.
🇨🇩 Heavy rains in the Democratic Republic of the Congo have unleashed a human tragedy, leaving at least 169 people dead, 30 injured, and more than 280 homes destroyed in the capital Kinshasa. This is the second time in two years that the city’s low-lying neighbourhoods have been devastated by floods. This week, mourners observed three days of national mourning to honour those who lost their lives. The government has promised to provide a dignified and secure burial for the deceased. The floods have also caused an estimated 8.2 million people in 20 countries across west and central Africa to be displaced, with more than half a million homes destroyed.
FOOD FOR THOUGHT
Proverb of the Day
“When brothers fight to the death, a stranger inherits their father’s estate.”
— Igbo Proverb.