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Africa Headlines

Nigeria’s MPC holds first meeting under Yemi Cardoso 26 – 27 February – The first monetary policy committee (MPC) since the appointment of Yemi Cardoso as Governor of the Central Bank of Nigeria (CBN) will hold 26 – 27 February 2024. The MPC did not hold in September and November 2023 following the sweeping changes at the Bank. The spotlight will therefore be on the governor, especially given the macroeconomic changes that has happened since the July 2023 last MPC. In that meeting, the 292^nd , the Monetary Policy Rate (MPR) was increased to 18.75% while the asymmetric corridor was adjusted to +100 / - 300 basis points around the MPR, and CRR and Liquidity Ratio were retained at 32.5% and 30%, respectively. Ahead of the meeting, there are two things that are very likely to happen. The first is that there will be a new composition of the MPC. That is, the changes are not just of the board of governors, but an entirely new look MPC. Second, I reckon the new MPC will increase MPR to demonstrate its stance towards tightening further liquidity. 

Nigeria’s economic capital, Lagos, bans styrofoam, other plastics – The Lagos State government in Nigeria has imposed a crackdown on production companies and distribution outlets involved in the usage and dissemination of Styrofoam and other single-use plastics. The ban aims to prevent the further circulation of these banned products. The state Commissioner for the Environment and Water Resources has directed the Lagos State Waste Management Authority and the Kick Against Indiscipline agency to implement the ban immediately. The decision was prompted by the frequent clogging of drainage channels with Styrofoam, despite regular cleaning efforts. The state is determined to protect its environment, particularly as a coastal city. The ban is based on existing laws and regulations, including the National Environmental (Sanitation and Waste Control) Regulation 2009 and the 2017 State Environmental Management and Protection Law. Producers, distributors, and end-users of Styrofoam face heavy fines, penalties, and potential premises sealing if they fail to comply with the ban.

Egypt’s leader el-Sissi slams Ethiopia-Somaliland coastline deal and vows support for Somalia – Egypt's President Abdel Fattah el-Sissi expressed support for Somalia in its dispute with Ethiopia over a deal that grants Ethiopia access to the sea through Somaliland and the establishment of a marine force base. El-Sissi criticized Ethiopia's agreement with the breakaway region and urged Ethiopia to seek sea access through Somalia and Djibouti without infringing on other countries' territories. He emphasized Egypt's commitment to protecting Somalia and standing with its brothers when asked to do so. Somaliland, a region that seceded from Somalia in 1991, signed a MOU with Ethiopia to lease a 20-kilometer coastline for the marine force base. However, the Somali president rejected the deal as a violation of international law and sought support from Egypt. Egypt has its own dispute with Ethiopia over the Grand Ethiopian Renaissance Dam, as it fears the dam's impact on its water and irrigation supply. Negotiations between Egypt, Ethiopia, and Sudan regarding the dam's filling and operation have been ongoing for over a decade, but a resolution has not been reached.

Uganda’s Museveni and Kenya’s Ruto leaves investors guessing about oil impasse amid tensions – Uganda has signed a bill that all petroleum imports into the country is handled by the Uganda National Oil Company (UNOC), after signing the Petroleum Supply (Amendment) Act. It followed Kenya’s new policy of Government to Government (G2G) tender process and not the previous Open Tender System (OTS). Uganda believes the new system empowers too many middlemen, potentially driving up the price of the 2.5 billion litres of fuel the country imports annually, 90% of which is imported from Kenya. Uganda is a landlocked country. Following this, Presidents Museveni and Ruto, the Kenyan leader, were expected to resolve these differences through diplomatic discussions, but no conclusions after the meeting. Uganda wants UNOC automatically registered to import petroleum products while Kenya wants it to compete with Kenya private companies.

DR Congo’s President Tshisekedi sworn in for second term amid disputes – Felix Tshisekedi, the President of the Democratic Republic of the Congo (DRC), has been inaugurated for a second five-year term following contentious elections in December. During the ceremony held in Kinshasa's Martyrs sports stadium, Tshisekedi, also known as "Fatshi," expressed his commitment to a more united, stronger, and prosperous Congo. He acknowledged the expectations of the Congolese people, particularly regarding unemployment, youth, women's rights, and national cohesion. The inauguration took place amidst simmering tensions in the volatile eastern provinces of the country. The stadium was filled with enthusiastic supporters, awaiting the arrival of African heads of state and traditional chiefs from the DRC's provinces. Tshisekedi initially assumed the presidency in January 2019 after controversially defeating Joseph Kabila. While he has not fully delivered on his promises to improve living conditions and end violence in the east, he campaigned for a second term based on his first-term achievements, such as providing free primary medication, aiming to consolidate progress during his new mandate.

Amazon's entry into South African e-commerce slated for Q4 2024 – Amazon is set to expand its presence in Africa by launching a dedicated website in South Africa, tapping into the growing e-commerce market on the continent. The move comes after leaked documents revealed Amazon's plans to expand into several African countries. The e-commerce giant aims to provide local sellers and entrepreneurs with the opportunity to grow their businesses and offer a convenient shopping experience for customers in South Africa. The African e-commerce market was valued at US $38 billion in 2021 and is projected to reach US $72 billion by 2025. Takealot, Everyshop, and Makro are among the existing e-commerce platforms that Amazon will compete with in the new market. The CEO of Takealot sees Amazon's entry as a recognition of the company's success and the investment potential in South Africa. Local businesses, such as African Mamas Crafts, are excited about the partnership opportunities with Amazon. However, Amazon will need to prioritize quality, affordability, and reliable delivery to gain customer trust in the competitive market.

Global Headlines

De Santis abandons presidential race, endorses Donald Trump – As always thought, the US presidential election is set to be a straight fight between President Joe Biden and the former US president Donald Trump, a repeat of the election four years ago. The continuation of the primaries in the Republican party may soon be unnecessary as the endorsement of Donald Trump by De Santis and Vivek Ramaswamy before leaves the race between him and Nikki Haley. The Iowa Caucus was held last week, with Donald Trump winning 51% of the vote and Nikki coming third with 19% of the vote. The New Hampshire primary holds tomorrow. Currently, Donald Trump holds double digit over Nikki Haley ahead of the primaries tomorrow. If Nikki Haley holds on after tomorrow, it is widely expected that she will drop out of the race if she loses her home State of South Carolina where she was governor 2011 – 2017. The South Carolina primaries hold February 24^th . 

US GDP numbers and personal consumption expenditure prices report due this week – The US will release two important reports this week, critical to how the Fed may judge what the direction of monetary policy will be over the coming months. Analysts have been watching the space for when the Fed will be able to lower interest rates. Q4 2023 GDP numbers will be released on Thursday, while the personal consumption expenditures prices, which gives an indication on inflation, will be released on Friday. The current interest rate is 5.25% - 5.50%, while inflation is 3.4%, down from 6.5% a year earlier.