The following items from May 21 may emerge to become significant factors impacting geomarket developments in Africa:
South Africa: Members of the newly elected parliament will be sworn into office on May 22.
Significance: Elections for national assembly leadership offices followed by the election of the South African president will take place once the parliamentarians are sworn in. By convention the African National Congress party president is the ruling party’s candidate for state president, meaning that Cyril Ramaphosa will certainly be reelected president of South Africa. In the days to follow his subsequent inauguration on May 25 will the South African president announce his new cabinet, which is expected to be streamlined in number and reflect the diversity that comprises the African National Congress. By already stating the composition of cabinet will aim to keep everyone happy, Ramaphosa is revealing the nature of his mandate is unity within the African National Congress, meaning he cannot stray too far with divisive policy prescriptions preferred by competing stakeholders.
Tanzania: The country’s $10 billion Bagamoyo deepwater port project is at an impasse amid stakeholder’s competing financial imperatives.
Significance: The Tanzanian government is unwilling to provide the scale of financial incentives that Chinese (and Omani) partners require for the proposed $10 billion project located north of the coastal commercial capital of Dar es Salaam to proceed. A failure to agree over exemptions from a range of taxes, levies and duties as well as a sovereign guarantee against financial losses have impeded a final investment decision from taking place. The Magufuli administration is proceeding with infrastructure development projects of national priority independent of the Bagamoyo project, and has budgeted almost $430 million to upgrade the existing port of Dar es Salaam, as well as roughly $500 million to update the ports of Tanga and Mtwara.
Zambia: Konkola Copper Mines will be liquidated and new foreign investors sought to operate the Vedanta Resources-controlled copper mines in the country.
Significance: The Zambian government enjoys the support of civil society and mining sector unions to dissolve the Konkola Copper Mines partnership and replace Vedanta Resources with another foreign investor operator. The government emphasized it is not taking over nor seizing private copper mining assets. Though the development has adversely impacted the Kwacha and Eurobond yields, the Lungu administration is demonstrating it will not compromise on foreign mining behavior it views as subverting its economic and financial imperatives.