The introduction of Zimbabwe’s own currency last month has worsened inflation and the new ‘Zim dollar’ may collapse before the end of the year. The government is facing mounting pressures from unions, importers, and lending partners to resolve the economic crisis and the well-respected but politically weak finance minister may be offered as a scapegoat to appease critics. Unless new revenue sources can be found, the risk of unrest, strikes, and another military intervention will continue to rise in coming months.
The power-sharing agreement will lower the risk of protests and violence for the first time in seven months, while commercial activity is set to resume, and normal diplomatic relations will be restored. However, the military is set to remain in charge of the transition at least for the next two years, while rival security forces and state-sponsored militia groups will seek to cut out lucrative economic assets to sponsor their re-armaments. Despite an initial lull in violence and political instability, the risk of civil war will remain high in the three-year outlook.
The dismissal of Zambia’s finance minister was a politically motivated act seeking to distract from a planned constitutional amendment that would remove a requirement of parliamentary approval of government loans and guarantees. The risk of a default will rise further in the second half of 2019, although Zambia’s new finance minister may still seek abrupt recourse to the IMF to avoid such a scenario.
The risk of violent protests by opposition supporters over reports of electoral manipulation poses a higher threat of commercial disruption than the northern insurgency, which might even simmer around the October elections. However, any threats by the main armed opposition to suspend the peace agreement are unlikely to be implemented and a resumption of conflict seems unlikely.
Since the 22 June coup attempt, there remain several questions that draw uncertainty over the government’s claims of responsibility and whether it has fully re-established control. Further retaliatory violence and detentions should be expected, particularly if the government decides to postpone elections slated for next year.
The political establishment has intervened to prevent several populist rising stars from participating at this year’s elections. Such tactics may backfire and trigger a fresh wave of political protests, just when the country could face a constitutional crisis over the political power vacuum in the presidency. A political stand-off in coming months will distract already overstretched security forces from the threat of Islamist militancy, while also straining relations with the IMF just when Tunisia seeks massive bond sales to support its gaping budget deficit and service existing debts.
A mostly peaceful and democratic transition of power will allow the political status quo to remain intact, while Mauritania embarks on an exciting new chapter of rapid economic development driven by recovering iron ore mining revenues and a nascent natural gas industry. Despite some concerns over potential contract reviews and the looming threat of regional militancy, EXX Africa remains largely optimistic on Mauritania’s investment outlook.
A long-running corruption scandal has hit the president’s family, providing a trigger for renewed protest action and civil disobedience by the opposition and powerful civil activist groups, while driving heightened risk of violence and acts of sabotage. President Macky Sall’s ambitious economic development agenda may stall in his second term, while participants in the oil and gas sector will face increased reputational risks, as well as potential delays to projects due to costly and lengthy arbitration proceedings and international fraud investigations.
Nationalist groups have failed to seize control of Ethiopia’s Amhara region, but their killing of the military chief of staff has triggered shockwaves through the country’s security forces. Ethnic and political retaliatory violence should be expected in the short term, while the government’s privatisation and liberalisation reforms are likely to face delays and next year’s slated elections are now even more likely to be postponed.
The French government has called on European countries to provide more support for the counter-insurgency effort in Mali and the wider Sahel. Yet such assistance is unlikely to be forthcoming and Mali faces an increasingly critical security crisis as Islamist militancy and ethnic communal violence spin out of control. The prospect of anti-government protests and labour strikes is becoming more prominent.
- ZIMBABWE: RISK OF CURRENCY COLLAPSE RISES AS HYPERINFLATION TRIGGERS UNREST
- SUDAN: FRAGILE POWER-SHARING DEAL WILL BRING SHORT-TERM PAUSE IN VIOLENCE
- THREATS TO BORDERS: AFRICAN MILITANCY AND TERRORISM
- ZAMBIA: SMEAR CAMPAIGN SEEKS TO DISTRACT FROM WEAKENING DEBT TRANSPARENCY
- SPECIAL REPORT: TOP TEN EAST AFRICAN CITIES AT RISK OF CRIME AGAINST EXPATS