African Business 2021

Governance and security

Governance and security are the keys to Africa’s future prosperity Credit: Tazara Malawi’s constitutional court ordered an election rerun in 2020. By John Young While 2020 will always be remembered as the year of Covid, some of the other events that took place in that year may also create a longstanding impact. A large number of presidential and general elections were held and although there were a few instances of leaders wanting to hang on for third terms and by so doing, making enemies of opposition forces and constitutionalists, a significant milestone was achieved when Malawi’s constitutional court threw out the results of the 2019 presidential elections and ordered another election to be held. That election was held in June 2020 and led to a new president being elected, Lazarus Chakwera winning 58.5% of the vote against the incumbent Peter Mutharika. If this is the harbinger of an increased respect for the rule of law, Africa’s chances of progressing in other fields will be improved. Another milestone will be achieved in 2021 when Niger’s current president stands down at the end of his term, allowing for a first peaceful transfer of power under a relatively new constitution. Altogether, African governance has not advanced to the degree that was expected five years ago. The 2020 Ibrahim Index on African Governance (IIAG) reports that progress has slowed in improving governance on the continent, even though fully 60% of Africans live in places which were in better shape in 2019 than they were in 2010. The 2020 report is based on data gathered in 2019. The 2021 election in Uganda will be watched very carefully. President Yoweri Museveni has been in power since 1986 and shows no signs of wanting to retire but Robert Kyagulanyi, a popular musician who goes by the stage name of Bobi Wine, has been gathering tremendous support in the face of several detentions and restrictions. Eighty percent of Uganda’s population is under the age of 30. Other serious obstacles to citizens being able to exercise their right to vote were experienced AFRICAN BUSINESS 2021 6

AFRICA OVERVIEW in the Central African Republic, where rebels made the 2020 election a fraught affair, and in Guinea, where violence during and after the elections led to dozens of deaths. The new president of the Seychelles has been nothing if not persistent. Wavel Ramkalawan’s successful bid for the presidency was his sixth attempt to attain the nation’s highest office. Seychelles is ranked third on the IIAG Index, behind Mauritius and Cape Verde. The rest of the top 10 is made up of Tunisia, Botswana, South Africa, Namibia, Ghana, Senegal and Morocco. Gambia showed the most improvement in 2019 and South Sudan and Somalia are at the bottom of the table. Mixed messages The first day of 2021 brought good news for Africa – that the continent’s first comprehensive free trade agreement had come into operation – but it was sorely needed to balance some of the big events that characterised 2020. Chief among these was Covid-19 but bad politics and increased violence contributed to a sense that many of the gains of recent years cannot be taken for granted. The two areas that best illustrate the fragility of progress are Ethiopia and Mozambique. In 2019 the prime minister of Ethiopia, Abiy Ahmed, was awarded the Nobel Peace Prize for restoring relations with neighbouring Eritrea and beginning a series of bold internal reforms. A decision to postpone elections because of Covid-19 sparked anger in the northern region of Tigray and the last months of 2020 were spent with the country engaged in civil war. The discovery of vast reserves of liquid natural gas off the coast of Mozambique has attracted huge investments from several international energy companies. However, the government’s inability to provide security against insurgents in the Cabo Delgado province has put those investments at risk. In December, the Export-Import Bank of Korea announced 0-million worth of financing for the Mozambique Offshore Area 1 Project but the same month brought news of towns being evacuated because of insurgent activity. So far, there has been no talk of international or regional peacekeeping forces, but that will surely come up sooner rather than later. The central Sahel region also had a turbulent 2020. The area along the boundaries that divide Burkino Faso, Mali and Niger has been at the centre of violent attacks by Islamist and ethnic militias which, according to The Economist, displaced 1.7-million people and led to an average of 3 000 people per day having to flee their homes. The UN has peacekeeping forces in the area and both the US and France have troops deployed there to assist local government forces. The size of Africa’s population (currently estimated at 1.2-billion) represents both opportunity and challenge. The continent by 2030 will increase the number of children in primary school from 189-million to 251-million and by 2050 Africa will record 42% of all global births (UNICEF). The upside of this is that huge markets for goods will be created but housing, education and healthcare will have to expand. As things stand, about 120-million Africans are unemployed and about 40% of the population live below the poverty line (.25). Urbanisation is already happening at a fast pace. This is another opportunity and a further challenge. The fact that Africa is arriving somewhat later in the digital age is an advantage because there are opportunities to leapfrog technologies. This is happening in mobile banking, where mobile telephones are delivering financial services across the continent. Integration and trade Africa has introduced a free trade agreement. In 2018 the African Continental Free Trade Area (AfCFTA) agreement was signed by 49 countries, making it one of the most comprehensive and potentially influential agreements ever signed on the continent. Since then, all but one country has signed the agreement and it officially came into effect on 1 January 2021. Although no-one expects that the agreement will immediately lead to borderless trade with 7 AFRICAN BUSINESS 2021