Politics, Economics and Risk in Africa

Summary

In this insightful discussion, Ronan, a director of Signal Risk, explores the intersection of politics, economics, and risk management in Africa. With 20 African countries facing elections, he addresses the uncertainty and anxiety surrounding these events, their impact on local and intra-African businesses, and the importance of policy predictability for investors. Ronan also touches on the challenges faced by Nigeria and South Africa, two key economies, and the role of digital democracy amidst the rise of social media and internet shutdowns.

Takeaways

• 🌐 The guest specializes in translating the intersection of politics and economics into actionable insights for commercial decision-makers in Africa.
• 🗳️ Approximately 20 African countries are going into elections, which brings anxiety and uncertainty affecting local and intra-African businesses.
• 📉 Investors are concerned about potential fiscal slippage, currency impact, corruption, violence, and internet shutdowns during elections.
• 🔄 The narrative of straightforward African elections is changing with examples like Kenya's annulled election and the DRC's manipulated outcome.
• 🇳🇬🇿🇦 For pan-African players, Nigeria and South Africa are crucial economies but have been performing below expectations for the past five years.
• 🇳🇬 In Nigeria, regulatory policy predictability and business-friendliness of the administration are significant concerns for investors.
• 🇿🇦 In South Africa, the new president's ability to consolidate power and gain a mandate for his reform agenda is a key focus for investors.
• 💡 The desire for a stable and predictable regulatory environment is a common theme among investors in African markets.
• 📱 The role of digital democracy has evolved from a force for good to one that can exploit divisions and create polarization.
• 🌐 Internet shutdowns as a response to elections and social unrest are becoming more common, raising questions about their impact on society and governance.

Q & A

What is the primary focus of Ronan's work?

Ronan focuses on the intersection of politics and economics, translating complex information into digestible insights for commercial decision-makers.

How does Ronan's work help in anticipating events?

Ronan's work simplifies complex information to help businesses react to events and anticipate future occurrences, providing a stable and predictable environment for decision-making.

What are the common concerns during elections in Africa?

Common concerns during African elections include fiscal slippage, currency impact, corruption, violence, internet shutdowns, and the overall uncertainty that can disrupt business operations.

Why are smooth transitions of power important for investors?

Investors prefer certainty and minimal disruption; smooth transitions of power allow them to continue investing and conducting business in a stable and predictable environment.

What are the key issues in Nigeria that investors should be cautious about?

In Nigeria, investors should be cautious about regulatory policy predictability, business-friendliness of the administration, currency and liquidity issues, and security concerns.

How has the new president's impact been in South Africa?

The new president in South Africa has been in power for about a year, but the honeymoon phase is over. The upcoming elections will show the level of support for his reform agenda.

What is the role of digital democracy in the context of South Africa?

Digital democracy, initially seen as a force for good, has been exploited to create polarization and societal fractures. The role of digital platforms in governance and society is becoming increasingly complex.

How have internet shutdowns in Africa impacted society and governance?

Internet shutdowns in Africa have been used as a tool to control information flow and suppress opposition, leading to concerns about democratic processes and freedom of expression.

What are the implications of elections on local and intra-African businesses?

Elections can lead to uncertainty and anxiety, affecting local and intra-African businesses through potential policy changes, economic instability, and disruptions in the business environment.

What is the current state of the economies in Nigeria and South Africa?

Both Nigeria and South Africa have been performing at subpar levels for the last five years, with issues related to policy predictability, economic stability, and investor confidence.

How can investors approach the uncertainty surrounding African elections?

Investors should focus on policy predictability, regulatory environments, and the potential for economic stability post-elections to navigate the uncertainty surrounding African elections.