🔅 Africa Growth: Lessons from East Asia
How to Romanticise Africa & Kenyans Parody Ruto
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Market Mondays
Year-to-Date Performance:
🟢 Johannesburg SE: 83,749.86 (+8.92%)
🟢 Nigerian SE: 96,579.54 (+29.16%)
🟢 Nairobi SE: 103.67 (+12.55%)
🟢 Ghana SE: 4,359.85 (+39.28%)
🟢 US S&P 500: 5,648.40 (+19.09%)
🔴 Shanghai Composite: 2,842.21 (-4.05%)
🇪🇹 Africa's biggest carrier, Ethiopian Airlines, is feeling the heat from Boeing's delays. They've been waiting since April for their 737 Max jetliners and 777 freight carriers. Now, they're forced to lease aircraft just to keep up with their expansion plans.
🇿🇲 Zambia's setting up an investment company to control at least 30% of production from future mines. Plus, they want investors to allocate 35% of their procurement budgets to local suppliers. Meanwhile, its annual inflation rate rose to a 32-month high in August as an El Niño-induced drought continued to wreak havoc on food prices.
🇿🇦 The end of regular power outages in South Africa might just be the silver lining the country needs. The central bank says this could lead to an upward revision in economic growth forecasts and help fight inflation. 155 days of sustained electricity supply? That's worth celebrating…
🇬🇭 Ghana, Africa's top gold producer, is finally getting a new large-scale greenfield mine after more than a decade. Expected annual production? Over 350,000 ounces.
🇳🇬 Nigeria's economy grew by 3.19% in Q2 2024, thanks to higher crude oil production and a strong services sector. But, it's still short of President Bola Tinubu's ambitious 6% target.
🇿🇼 Zimbabwe's monthly inflation rate has climbed to the highest level since they started tracking prices in their new bullion-backed currency. A severe drought is fanning the flames of food inflation, and it's expected to keep burning until next year's harvest.
🇨🇳 Chinese lenders approved loans worth $4.61 billion to Africa last year, marking the first annual increase since 2016. Is the Belt and Road Initiative back on track after the pandemic speed bump?
🇨🇲 Cameroon's cocoa and coffee association has signed agreements with six cocoa exporters to roll out a platform providing plantations' location data. Why? To comply with the EU's upcoming regulation on deforestation-free products.
🌍 Africa has secured less than 10% of the estimated $245 million it needs to fight the surging mpox outbreak. A substantial increase in cases could hit consumption, production, and tourism.
*Data accurate as of the close of markets across the continent
Spotlight Stories
Africa's Economic Challenges: Lessons from the East Asian Playbook
As Africa braces for economic headwinds in the coming years, with growth forecasts barely outpacing population growth, it's time to take a page out of East Asia's playbook. Here are three key lessons that could help the continent navigate the choppy waters ahead according to The Brookings Institute:
1. Mobilize Domestic Capital and Reduce Reliance on External Financing
Forget about borrowing from international creditors – it's time for Africa to tap into its own pool of wealth. With $2.3 trillion worth of investment funds, pension funds, and sovereign wealth funds locked overseas, the continent needs to develop a deeper capital market to channel these resources back home.
Just look at South Korea – they financed their own industrialization by funneling domestic retirement savings into national champions like Samsung and Hyundai. And they could do that because they had a well-regulated, functional capital market to facilitate such transactions.
2. Prioritize Food Security and Support Farmers
Food security is no joke, and Africa can't afford to leave it to the whims of the market or the dictates of the state. China learned this the hard way after suffering the worst man-made famine in living memory. Now, they're so paranoid about food security that they keep enough rice and wheat in reserves to feed their 1.4 billion citizens for more than 18 months.
This means subsidizing seeds and fertilizers, delivering extension services, and guaranteeing minimum price support for their output. With 158 million Africans facing acute food insecurity, doubling public expenditure on agriculture and allocating at least 10% of annual budgets to the sector, as called for by the African Union, is a must.
3. Industrialize at Warp Speed
Manufacturing is the tried-and-true path to economic transformation, and Africa needs to get on board ASAP. East Asia started at the bottom of the ladder, producing cheap toys, footwear, and garments, but as incomes and wages grew, those jobs moved to South and Southeast Asia.
While manufacturing labor costs in Africa are still higher than in South Asia, the gap is closing. With 60% of African imports consisting of manufactured goods by value, producing these goods locally could keep more value at home and create new jobs.
But Africa must position itself differently. With robotics and AI threatening to wipe out wage cost advantages for industrial latecomers, and supply chains shifting along geopolitical lines, the continent has a short window of opportunity to industrialize.
In conclusion, Africa faces significant economic challenges in the coming years, but by learning from East Asia's experience, the continent could chart a path towards greater prosperity. Mobilizing domestic capital, prioritizing food security, and industrializing at warp speed are key strategies that could help Africa weather the storm and emerge stronger on the other side.
Maïmouna Elle: A Lesson On How to Romanticise Africa
Meet Maïmouna Elle, the creative force behind the viral Instagram account @RomanticizingAfricanCountries.
With a passion for filmmaking and a mission to challenge harmful narratives about the African continent, Elle is taking social media by storm.
Elle's journey to becoming a social media sensation began with a detour from her medical career. After completing a year as a categorical surgeon at the University of Alabama in Birmingham, she decided to take a break and reconnect with her roots in Senegal. It was there that her love for filmmaking and African cinema truly blossomed.
Launched just four months ago, @RomanticizingAfricanCountries has already amassed over 100,000 followers.
Elle's secret? Capturing the authentic beauty of African life through an honest and witty lens. From Senegalese women braiding their hair on a porch to a young Gambian man playing football by the beach, Elle's videos showcase the diverse and vibrant lives that often go unrepresented in mainstream media.
What sets Elle's account apart is her commitment to uplifting African artists, decolonized libraries, and fashion brands from the continent. By using her platform to showcase the talent and creativity thriving in African countries, Elle is helping to shift the narrative and inspire pride in African heritage.
Be sure to give @RomanticizingAfricanCountries a follow – your feed (and your worldview) will thank you.
Kenyans Mock President Ruto's 'Development' Tours with Hilarious Ribbon-Cutting Parodies
In a display of their trademark wit and humor, Kenyans have taken to social media to poke fun at President William Ruto's extensive 'development' tours. These tours have seen the President launch an array of projects, from the grandiose to the seemingly mundane, including water stations and even a school dormitory.
The trend, which began taking X (formerly Twitter) by storm features Kenyans wrapping ribbons around various nondescript items and pretending to launch them. This playful mockery is an apparent jab at Ruto's tendency to officiate projects that would typically be launched by junior staff.
Kenyans began noticing that the President wasn't just launching grand projects, but had also developed a fondness for officiating the opening of rather 'mundane' things like school dormitories and water tanks. In response, they decided to apply sarcasm by imagining other meaningless items that could be 'launched' by the President.
One creative Kenyan shared a photo of himself 'launching' a mound of ugali (a traditional cornmeal dish), complete with a pair of scissors in hand. He wrote, "We're pleased to have William Ruto commission this ugali tonight. He has promised to deliver 3 Luhya men to help us finish it and a posho mill built within this single room."
Another Kenyan took aim at the country's mosquito problem, sharing a photo of a can of Mortein Doom insecticide adorned with ribbons. The caption read, "There were so many mosquitoes in my room tonight but thanks to President William Ruto, he has launched a Ksh.2 billion insecticide to help me combat the insects. Ruto tano tena!"
Not even the sacred act of sleeping was spared from the satirical 'launches.' One Kenyan shared a photo of themselves 'launching' their bed, writing, "Tonight, we are pleased to have the President commission the next eight hours of sleep. During that time, his administration will ensure that I sleep soundly and that in the next eight hours, sleep will be replicated all around the country. #RutoDelivers!"
Since the street demonstrations died down and political temperatures lowered, the President has embarked on 'development' tours that have seen him criss-cross the country, accompanied by several senior government officials. However, Kenyans have astutely observed that some of these projects had already been launched several years ago, and by none other than the President himself.
Food for Thought
“The sound of the drum depends on the drummer”
— Mozambican Proverb