🔅 South Africa's Economy Escapes Recession, Rwanda's Genocide Trial Twist, and AU's Development Challenge
South Africa's close call with recession, a dramatic turn in the Rwandan genocide trial, to the complexities of the African Union's development plans.
Photo of the day: Kampala, Uganda
Markets:
🔴 Nigerian SE: 56,024.52 (-0.03%)
🟢 Johannesburg SE: 77,125.85 (+0.37%)
🟢 Ghana SE: 2,637.44 (+4.17%)
🔴 Nairobi SE: 106.43 (-0.08)
🔴 US S&P 500: 4,265.32 (-0.43%)
🟢 Shanghai Composite: 3,197.76 (+0.07%)
South Africa Just Missed a Recession | South Africa’s economy had a close call: It narrowly avoided a recession in the first quarter of 2023, according to the latest data released this week. Phew! With electricity cuts lasting up to 10 hours a day, it’s a miracle that the nation managed to eke out 0.4% growth quarter-on-quarter. A big shout-out goes to the manufacturing and finance sectors, which were the major players in keeping the economy afloat. And props to restaurants and hotels, who kept household consumption going strong despite the power outages. Analysts remain pessimistic, though: Severe electricity cuts, tight fiscal and monetary policy, mean that South Africa’s economy is likely to stagnate this year.
*Data accurate as of the close of markets across the continent
Brief & Bright: Africa's Top Five Highlights
🇷🇼 Félicien Kabuga's Escape | There was a dramatic twist in the trial of 88-year-old Rwandan genocide suspect Félicien Kabuga this week. Despite being charged with crimes including genocide, incitement to commit genocide, and conspiracy to commit genocide, judges declared him unfit to continue standing trial due to his dementia. This means that no guilty verdict can be reached, much to the dismay of many Rwandans. Kabuga was one of the last fugitives charged in connection with the 1994 genocide and was arrested in France last year. It’s a setback for justice, but the hunt for Kabuga’s accomplices continues. Another top suspect, Fulgence Kayishema, was arrested in South Africa only two weeks ago after 22 years on the run.
🇨🇲 🇨🇬 Cameroon-Congo Rail: Building Physical/Political Connections | Cameroon and Congo Republic are teaming up to build a railway connecting Cameroon’s coast to an iron ore deposit straddling the two countries’ border. Construction is set to begin at the end of August and the railway will have a capacity to carry 35 million tonnes of high-grade iron ore per year for a decade. The railway has a bit of a bumpy road to completion, though. Australia's Sundance Resources is taking legal action against Cameroon and Congo Republic for developing the project with Chinese investors, even though they had a contract with Sundance. But Cameroon’s interim Mines Minister Fuh Calistus Gentry is still optimistic, saying that the two countries can “demonstrate to the world the maturity of our two peoples.” He also added that 12 new mining projects had been identified in Cameroon, five of which are set to start this year.
🇬🇭 Ghana’s Battle with Illegal Mining | Heavily armed soldiers were called into Obuasi, a gold mining town in the Ashanti region, to break up protests sparked by the government’s crackdown on illegal miners. Seven miners were arrested after they were caught leaving a shaft owned by AngloGold, and hundreds of others were reportedly stuck underground without food or water. What's more, the authorities are demanding cash payments from the miners’ families in exchange for their release. The crackdown is part of President Nana Akufo-Addo’s promise to rid the country of “galamsey”—or illegal mining. The Obuasi mine produced 250,000 troy ounces of gold last year and illicit mining is widespread in the West African country, where many in poor communities see it as a way of making a living.
🧱 The AU's Grand Plan: Connectivity and Industrialisation | The African Union’s Agenda 2063 initiative has big plans to link the continent by rail, road, sea, and air, as well as improve economic integration. But an article by The Conversation suggests that this approach to development—building infrastructure and planning urban spaces—may not be enough to foster industrialisation and make Africa competitive in the global economy. In fact — taking Kenya and Ghana as case studies — the authors' research says that these projects encourage excessive land speculation, which hampers development. Thus, the AU's plans need to be revised to include policies that discourage land speculation and encourage productive investment in factories that can provide jobs. Without these policies, Africa risks getting locked into the global economy as an exporter of raw materials. What do you think?
🇳🇬 Nigeria's Kidnapping: A Million-Dollar Problem for Airtel | Trying to crack down on kidnappings is proving costly for Indian billionaire Sunil Mittal's Airtel. After Nigeria imposed a rule requiring all phone numbers to be registered, the wireless phone operator had to suspend about 75 million unregistered users—costing the company about $110 million in annual revenue. The rule was meant to make it harder for kidnappers to use unrecorded SIM cards to contact victims’ relatives. It looks like Nigerian authorities and Airtel are both paying the price for the country’s rampant kidnapping problem.
FOOD FOR THOUGHT
Proverb of the Day
“In the moment of crisis, the wise build bridges and foolish build dams.”
— Nigerian Proverb.
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