The newly elected president has consolidated his political authority through shaking up the cabinet, while he is sending a reformist message to creditors that he will prioritise growth as a mechanism for development, beginning with measures to stabilise the country’s precarious fiscal and monetary positions.
Policy uncertainty ahead of next year’s elections, mounting concerns over debt sustainability, and rising fuel prices are likely to mar Namibia’s economic recovery and drag down the economy’s growth outlook.
The governing party will support a constitutional amendment to clarify expropriation of land without compensation in order to limit divisive politicisation and to manage public expectations. Any land reform agenda would prioritize idle state-owned land near urban settings for low-income housing purposes, and idle farmland for agricultural purposes.
Following disputed and tainted elections, Zimbabwe’s massive debt burden and its severe foreign exchange and monetary crisis remain the major obstacles to unlocking substantive flows of private and foreign government finance, despite moderate flows of renewed UK support.
Mining companies threaten production cuts and arbitration to protest new regulations, while the government uses the courts as leverage over the industry; yet further escalation is unlikely as both sides remain willing to find settlements.
In a raft of new legislation and directives, the government further curtails internet freedoms and extends control over revenues from the mining and telecoms sectors, while threatening to encroach its nationalist policies into the banking sector.
The governing party is in pole position to win the July elections despite fractious internal rivalries. Yet debt clearance will be as important as the approval of election monitors to unlock new investments.
Despite high growth and basking in a favourable spotlight, nationalist interventions in the economy and weakening political stability indicate that the current mirage of Djibouti’s investment potential is overstated and unsustainable.
Foreign investment has dropped by more than 30% since 2015, when the current government took office; meanwhile local credit growth is collapsing and the prospect of an economic downturn is steadily increasing.
Violent communal unrest and virulent labour action are frustrating South Africa’s new president’s reform agenda and undermining the ruling party’s image shift, yet the government’s ability to curb these challenges is limited ahead of the 2019 elections.
- EXX Africa director Robert Besseling moderated a panel on Africa’s commodity rollercoaster at GTR Commodities in Geneva hosted by Global Trade Review (GTR)
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