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Europe turns to Africa to replace Russian gas

European officials have increasingly looked to Africa to replace gas supplies from Russia. While the region’s gas producers – like Angola and Nigeria – will gain from the recent surge in global energy prices, it’s not clear that they will be able to raise overall production, at least in the near term. In a similar vein, gas production is not likely to come online (at least significantly) until later this decade in some other countries like Mozambique and Tanzania.
Virag Forizs Emerging Markets Economist
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Africa Economics Weekly

SA corruption and inflation on display, Ghana’s troubles

The president of South Africa and the ruling ANC are taking the heat as corruption accusations fly. With political bickering likely to grow, the focus on boosting the economy with much-needed reforms is likely to take a backseat. Meanwhile, we think that the latest inflation reading out of South Africa will shift the debate on the scale of further monetary tightening towards 75bp steps. And in Ghana, policymakers appear to be stepping up efforts to support the cedi but at the risk of adding to the economy's pain.

24 June 2022

Africa Data Response

South Africa Consumer Prices (May)

The rise in inflation in South Africa to an above-target 6.5% y/y in May is likely to shift the debate to a choice between a 50bp and a 75bp hike to interest rates at July’s MPC meeting. But inflation continues to be driven by food and energy price effects and, if the headline rate falls sharply over the rest of this year as we expect, interest rates will probably be raised by less than investors anticipate over 2022-24.

22 June 2022

Africa Economics Update

Where next for inflation in South Africa?

Inflation in South Africa has been close to the top of the central bank’s target range in recent months, but the country has avoided the surge in inflation seen across much of the world. And there are reasons to think that the headline rate will drop back sharply by the end of this year. That underpins our view that monetary policy will ultimately be tightened by less than investors currently expect.

21 June 2022

More from Virag Forizs

Africa Data Response

South Africa Consumer Prices (Mar.)

The rise in inflation in South Africa in March, to 5.9% y/y, will keep the Reserve Bank’s tightening cycle going at the next meeting in May. But the weakness of core inflation supports our view that interest rates will be raised more gradually than most currently anticipate.

20 April 2022

Africa Economics Weekly

Floods hit SA recovery, Nigeria’s presidential race

This week’s floods in South Africa’s KwaZulu-Natal province are the latest in a series of hits to the economic recovery. Elsewhere, the news this week from Nigeria that Vice President Yemi Osinbajo has thrown his hat in the ring as a candidate for the 2023 presidential election offers hope for a shift away from the current distortive economic policies of President Buhari. But there are a lot of potential candidates and whoever wins will face an uphill battle to boost GDP growth.
We are sending this Weekly one day earlier than usual because our offices are closed for Good Friday on Friday, 15th April.

14 April 2022

Africa Economics Update

Assessing public debt risks in Africa

In this Update, we roll out our sovereign debt heat map that provides a snapshot of debt risks across Sub-Saharan Africa. The pandemic has increased debt burdens across the continent and, with elections on the horizon in many places, governments are unlikely to push through the austerity needed to stabilise debt. While the rise in commodity prices caused by the war in Ukraine is a positive for some (e.g. Angola), tighter external financing conditions pose significant risks for others (e.g. Ghana). Long Run Outlook Drop-In (23 March, 11:00 EDT/15:00 GMT): What will be the lasting impacts of the war in Ukraine? What legacies will the pandemic leave? What does a future of higher inflation mean for economies and markets? Neil Shearing hosts this special discussion with senior economists about the long-term investing outlook on Wednesday. Register here.

21 March 2022
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