The level of inequality in the world is alarming! Richest 1 percent is now wealthier than the rest of the world. Of this 1 percent, some got their wealth through corrupt practices, especially in Africa. Nigeria’s President Muhammadu Buhari is fighting them as much as he can and has the world’s backing. But while he does, he may be losing grip of the economy. He must work on increasing Nigeria’s revenue on other fronts as oil prices remain low.
Like Africa’s largest economy, the continent’s most advanced economy also has its economic issues. Confidence is, however, high in the finance minister Pravin Gordhan’s ability to turn things around with the right policies. South Africa and Nigeria’s issues regardless, they remain the most promising markets in sub-Saharan Africa.
Meanwhile, about 14 million people in Southern Africa face hunger, no thanks to drought exacerbated by extreme weather condition El Nino. Both South Africa and Zimbabwe have announced plans to import maize, one of the major crops they produce as poor rains have reduced production.
Oil prices fell below $30 during the week and may fall further, especially with the lifting of ban on Iran. It’s mixed fortune for South Africa as MTN rejoiced for being able to access over $1 billion profits stuck in Iran over the years (it has $5.2 billion fine to pay in Nigeria), while Chevron announced it was seeking buyers for 75 percent of its South African business. Iran’s gain is Nigeria’s pain. It may become South Africa’s new oil supplier, grow its economy while Africa’s largest economy deals with the economic crisis it faces. In the meantime, Nigeria will borrow to sustain its economy.
But Ethiopia must stop its crackdown on Oromia demonstrators. South Sudan needs $1.3 billion and some investors are seeing beyond conflicts and violence in Africa. Rezidor plans to build 35 hotels across Africa in four years, 54 Capital plans to build a new plant for Addis Pharmaceutical Factory and Amaya Capital Ltd has invested $879 million in the the 450MW Azura-Edo Independent Power Project in Edo State, Nigeria.