The following items from April 24 may emerge to become significant factors impacting geomarket developments in Africa:
Ethiopia: Several economic cooperation agreements were signed during Prime Minister Abiy Ahmed’s visit to China including a $1.8 billion contract with the State Grid Corporation of China for construction of an electricity transmission and distribution network in the country.
Significance: Abiy is visiting China ahead of the Second Belt and Road Initiative Forum that Beijing is hosting April 25-27. The contract with the State Grid Corporation of China provides robust electricity connectivity between electricity generation projects underway, notably the Grand Ethiopian Renaissance Dam (GERD) project, and the series of enterprise parks being constructed across the country intended to make the country a global light manufacturing hub.
Kenya: The Kenyan government intends to sign agreements to borrow approximately $3.5 billion from Chinese lenders to finance the construction of the country’s standard gauge railway linking Naivasha with Kisumu.
Significance: The Kenyan government delegation led by President Uhuru Kenyatta is visiting Beijing to attend the April 25-27 Second Belt and Road Initiative Forum. Chinese lenders have financed the first phase of Kenya’s standard gauge railway that has been constructed between the port of Mombasa and the capital Nairobi as well as the second phase of construction that is soon to be completed between Nairobi and Naivasha. Should the Ugandan government also obtain Chinese funding for their section of the standard gauge railway, the project, once complete, will provide robust supply chain connectivity for markets between the Indian Ocean and the Great Lakes region of central Africa.
Tanzania: The government delivered an initial $309 million payment to Arab Contractors Company for preliminary works to commence on the country’s 2,115 megawatt Stiegler’s Gorge hydroelectric power project.
Significance: The Tanzanian government intends that the approximately $3 billion, self-financed project will be completed in 36 months. Alongside other public infrastructure projects, including a crude oil pipeline, a natural gas pipeline, a standard gauge railway, and a deepwater port, as well as new natural gas fields to be developed, the Magufuli administration intends that priority economic development projects in the country proceed without unreasonable delay, and will assert unilateralist measures to defend its economic imperatives.
Zimbabwe: The Mnangagwa administration signed a memorandum of understanding with the Tsingshan Holding Group for the construction of a $5 billion steel plant and related infrastructure project.
Significance: Should milestones be achieved and construction begins in roughly 12 months time, the Mnangagwa administration will have attracted foreign investment memoranda exceeding $10 billion. Additionally, should the Zimbabwean government follow through and successfully repeal controversial legislation, notably the Public Order and Security Act (POSA) and the Access to Information and Protection of Privacy Act (AIPPA), and see foreign sanctions on its officials be lifted, the country’s beleaguered economy could see meaningful growth and support resume.