Common currency negotiations in West Africa, pro-Mining Code briefings in the Democratic Republic of the Congo, South Africa’s State of the Nation speech, and US-Zimbabwe diplomatic talks are actions from June 20 that may emerge to become significant factors impacting geomarket developments in Africa.
Côte d’Ivoire, Economic Community of West African States: The government of Côte d’Ivoire hosted finance ministers and central bank governors from the Economic Community of West African States for negotiations on a common bloc currency.
Significance: The West African regional bloc comprises fifteen member states who conduct extensive internal trade relationships in nine different currencies (not including global currencies such as the U.S. dollar and the Euro). Should Mauritania become a full partner, the bloc would make for sixteen members and ten currencies. The gathering in Abidjan of the region’s finance principals precedes a heads of state summit that the Nigerian government will host in Abuja on June 29 at which the region’s presidents are expected to approve the recommendation for a single regional currency, though the schedule for implementation as early as 2020 will be subject to ongoing technical (not to mention sovereignty) negotiations. The intent of a single West African currency is to take advantage of the extensive trade relationships already in place among the bloc’s members and reduce costs of doing business across intra-bloc borders.
Democratic Republic of the Congo: Government and public officials participating at the DRC Mining Week conference spoke in defense of the country’s revised Mining Code.
Significance: The mining sector conference taking place June 19-21 in Lubumbashi is a significant gathering of foreign mining companies and Congo government agencies all intending to improve their share in the proceeds of the country’s mining sector. The Congo government’s Mining Code is a key piece of legislation the foreign mining operators would like re-revised (the Code was revised in early 2018) and its particularly onerous tax burdens reduced. Officials representing Congo government interests, from Albert Yuma of the state-owned Gecamines mining company to the Congo president’s advisor for Mineral Resources did not, however, make any case for new amendments to the Mining Code.
South Africa: President Cyril Ramaphosa delivered his State of the Nation address.
Significance: Ramaphosa’s national address in parliament was his first since his reelection on May 22 as president of South Africa. Included in his speech were pledges to provide ZAR 230 billion (roughly $16 billion) in special funding for the indebted Eskom power utility company, a commitment to preserve the constitutional mandate of the South African Reserve Bank, a plan to create two million new jobs for underemployed youth, and to look at public land suitable to solve for land ownership inequalities. The content of the national address aimed to balance competing demands made of the South African government that ensure critical state-owned enterprises (notably Eskom) continue to function while at the same time minimizing government actions that jeopardize the fragile confidence the international finance community holds in the South African government.
U.S, Zimbabwe: Zimbabwean President Emmerson Mnangagwa met with U.S. Assistant Secretary of State for African Affairs Tibor Nagy.
Significance: The Zimbabwean and U.S. officials met in Maputo while both were attending the U.S.-Africa Business Summit taking place in the Mozambique capital. The Zimbabwean leader spoke of the meeting as a new level of engagement with the U.S. government while the U.S. diplomat pressed Mnangagwa to hold his government to account for human rights governance and effecting meaningful reforms. In other words, there was no breakthrough in the bilateral U.S-Zimbabwe relationship, no matter the efforts by the Mnangagwa administration to repeal particularly controversial legislation seen as impeding the lifting of U.S. (and European) sanctions on Zimbabwean leaders.