Africa Economics Weekly

Africa Economics Weekly

ANC leadership contest, Ghana’s debt, Ethiopia’s conflict

Leftist factions of South Africa’s ruling ANC already appear to be gearing up to take on President Cyril Ramaphosa in December’s leadership election and this is likely to push fiscal policy in a looser direction, worsening the country’s debt problems. Debt concerns are also building in Ghana and remain elevated in Ethiopia as well, even though there are signs that the internal conflict is abating.

14 January 2022

Africa Economics Weekly

SA experience offering Omicron hope? Nigeria’s budget

Evidence is growing that South Africa’s Omicron-driven virus outbreak has been brief and not as economically damaging as previous waves. This is a promising omen for other economies in Sub-Saharan Africa where COVID-19 cases have also shot up. Meanwhile, in Nigeria, ambitious 2022 budget plans that were approved late last year will – like previous ones – probably miss the mark.

7 January 2022

Africa Economics Weekly

Virus waves across SSA, SARB tightening cycle

After a week filled with central banks around the globe pivoting in a more hawkish direction, we have now pencilled more hikes into our interest rate profile for South Africa (but only after a pause in the tightening cycle in January due to the Omicron wave). At this point, the authorities there have still not moved to tighten virus containment measures. The same applies elsewhere in the region, even though COVID-19 cases have started to pick up too.
– This will be the last Economics Weekly for 2021. The next Weekly will be sent on Friday 7th Jan. 2022 –

17 December 2021
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Africa Economics Weekly

Omi-chronicles from South Africa and beyond

South African officials seem to be pushing vaccine take-up to curb the latest Omicron-induced virus outbreak rather than tightening restrictions on activity. But with pressure building on the health system, this risks the introduction of harsher and more economically damaging containment measures down the line. Elsewhere in Sub-Saharan Africa, even as policymakers counter vaccine hesitancy with mandates, problems with distribution and the supply of doses are likely to hold back inoculation campaigns.

Africa Economics Weekly

Lockdown lessons from SA, influx of jabs and cash?

South African policymakers appear to be reluctant to impose restrictions in the face of the threat from the Omicron variant, but their hand could be forced if the health system comes under strain. In previous waves, measures have been tightened when hospitalisations have breached 5,000. While we’re some way off that, the figures are on an upwards path. Meanwhile, ambitious pledges by Africa’s key development partners including China and the EU on vaccines and infrastructure investment will lift the region’s longer-term economic prospects. Finally, even with the IMF on board, restoring Zambia’s debt sustainability will remain challenging.

Africa Economics Weekly

Recoveries trembling under new virus variant threat

A concerning new virus variant identified in Southern Africa has already prompted the re-imposition of restrictions on travellers from the region and triggered a flight to safety in global financial markets. A tightening of local containment measures is likely to follow, dampening economic activity, and the threat of a new virus wave will linger.
Drop-In: The B.1.1.529 strain – The economic and markets impact 10:00 ET/15:00 GMT, Friday 26th November Group Chief Economist Neil Shearing will be joined by senior economists from across our services at 10:00 ET/15:00 GMT today to give their views and answer your questions about the potential economic and markets impact of this new virus strain. Click here to register and to submit your questions ahead of the session. 

Africa Economics Weekly

African central banks and the EM rate hike club

This week, the South African Reserve Bank joined its EM counterparts in tightening monetary policy, but we don’t think that policymakers in South Africa will raise interest rates as aggressively as central banks across Emerging Europe and Latin America. Elsewhere, a further fall in inflation last month and soft Q3 GDP figures mean that Nigeria’s central bank is unlikely to join the EM rate hike club any time soon.

Africa Economics Weekly

SARB to hike or not to hike? That’s investors’ question

The big event next week is South Africa’s MPC meeting which will be a very close call, but on balance we think that the first rate hike will not be delivered just yet. And, further ahead, the tightening cycle is likely to be more gradual than investors currently anticipate.

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