Items of Interest: August 28

A bilateral Mauritania-Senegal meeting, South Africa’s Economic Growth Strategy paper, and Zambia assessing its judiciary options on arbitration are actions from August 28 that may emerge to become significant factors impacting geomarket developments in Africa.

Mauritania, Senegal: Mauritanian Prime Minister Ismail Ould Cheikh Cydia and Senegalese President Macky Sall met in Yokohama on the sidelines of the Tokyo International Conference on African Development. 

Significance: The Mauritanian prime minister, appointed into his position on August 2, represented his government at the Japan-Africa summit. The meeting on the sidelines of TICAD is the first senior bilateral meeting between the two neighboring governments since the election of Mohamed Ould Ghazouani as president of Mauritania on June 22. Bilateral interests are led by efforts to harmonize and implement a fiscal term and revenue sharing agreement for natural gas that is being developed in the Greater Tortue Ahmeyim field straddling the offshore waters of Mauritania and Senegal. Both governments have engaged constructively to provide an enabling regime facilitating foreign direct investment that is estimated could reach $40 billion by 2024. For its part the Mauritanian government has demonstrated continuity of policy throughout the transition from Mohamed Ould Abdel Aziz to Ghazouani, while the Senegalese government has promoted policy transparency to underwrite fiscal regime stability in the country’s hydrocarbons sector. 

South Africa: The National Treasury released for public comment a policy paper entitled Economic transformation, inclusive growth, and competitiveness: Towards an Economic Strategy for South Africa.

Significance: While there is unanimity within South Africa that the economy, projected to grow at 1% in 2019 and facing unemployment of 29%, must expand and create jobs, prescriptions for achieving transformative and inclusive growth in South Africa yield diverse and oftentimes opposing proposals. The National Treasury, led by Finance Minister Tito Mboweni, has consistently sought a position that ensures the stability of South Africa’s fiscal regime, meaning restrained spending, constrained public debt levels, and preserving the independence of the country’s Reserve Bank. The finance minister is, however, but one voice among many in the political management of the South African economy. The preferences called for in the National Treasury policy paper will be received by the ruling African National Congress and its cabinet when it gathers on September 4 as but one set of suggestions that must be balanced against competing proposals, such as the nationalization of the South African Reserve Bank, the expropriation of land without compensation, and, citing Minister of Employment and Labour Thulas Nxesi on August 27, the introduction of regulatory requirements for racial quotas for senior management positions in private South African companies.   

Zambia: The Lusaka High Court suspended hearings to dissolve the Konkola Copper Mines partnership.

Significance: The ruling in Lusaka is an outcome of the August 23 ruling in Johannesburg by the South Gauteng High Court that the latter held jurisdiction and that arbitration was appropriate to resolve the dispute between the Zambian government and Vedanta Resources over the Konkola Copper Mines partnership the Lungu administration wants dissolve. The Lusaka High Court, which began hearings August 27, will defer to a ruling by the country’s Court of Appeal on arbitration. The ruling by the South African judiciary was a setback for the Zambian government, who otherwise would have proceeded to see the KCM partnership be dissolved. Given the critical geopolitical dependency Zambia has on South Africa, the Lungu administration cannot ignore the ruling in Johannesburg, as it has done with reconciliatory efforts by Vedanta Resources.   

Other items of note:

-Angola’s ministry of natural resources and petroleum will auction new phosphates, iron ore, and diamond mining concessions in September. 

-Côte d’Ivoire’s opposition parties the Democratic Party of Côte d’Ivoire and the Ivoirian Popular Front stated they will not participate in the recently-reformed Independent Electoral Commission. 

-Egypt, Ethiopia, and Sudan will meet in September for negotiations over the filling of the Grand Ethiopian Renaissance Dam reservoir.

-Mozambique National Resistance spokesman José Manteigas said threats by the opposition party’s military junta are criminal and is a matter for the country’s defense and security forces to safeguard against. 

-Tanzania’s National Bureau of Statistics citing a Tanzanian Investment Center report indicated that year on year the number of new foreign-owned investment projects in 2018 fell by 60% to 69 and the value of new investment projects in 2018 fell by 40% to $2.8 billion. 

-Zimbabwe’s public sector union bargaining council accepted the government’s wage increase offer. 

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