Africa accounts for only 2% of global trade, but the continent is not immune from global trade tension. South Africa is already a major casualty of the US-China trade war. South African financial markets are more sophisticated than other markets on the continent. The South African economy is also more integrated with the global economy. Therefore, the vulnerability of the economy to exogenous shocks is much higher than less integrated African economies. This is illustrated by the volatility of the rand relative to other African currencies. The rand has been one of the worst-performing emerging-market currencies, losing 9.8% of its value in the last 2 months. Other factors such as slow domestic growth and policy uncertainty have also contributed to the currency’s weakness.
Apart from economic vulnerability, Africa is also facing some domestic political issues. Ivory Coast’s October 2020 presidential election had previously been portrayed as the first opportunity for the country’s leadership to peacefully transition to a new generation of leaders. However, recent events suggest that this may no longer be the case. There are fears that the instability generated by former president Laurent Gbagbo’s (74) return to the country and the simmering rivalry between former president Konan Bédié (85) and current president Alassane Ouattara’s (77) respective camps could reignite a political crisis that could lead to a repeat of the civil strife of 2011.
As African countries mature politically, they also have to adopt best practice. The Single African Air Transport Market (SAATM) is a vivid indicator of African nations acceptance of regional integration. However, the target of establishing the SAATM by 2019 does not appear feasible. The lack of political will and the policies of some governments, designed to protect their respective national carriers, are obstacles to the successful implementation of the agreement. In West Africa, at least 3 airports are competing to be the leading hub; Abidjan’s Felix Houphouet-Boigny Airport, Accra’s Kotoka International Airport and the Lome-Tokoin International Airport.
Sub-Saharan Africa is often regarded as the world’s fastest region of rural to urban migration. Urbanization has posed some major challenges including urban renewal and inadequate provision of social services. Lagos, Africa’s most densely populated city, was ranked 137th out of 140 cities on the 2018 Global Liveability index. It has incessant traffic jams, bad roads and a failed public transport system. With new updates for informal transit directions to its Map service, Google is making it easier to get around the city. The voice assistant on Google Maps now has a Nigerian accent.
This edition of the FDC Afriscope promises to be an interesting read on developments in Africa.
Do enjoy your read!