Africa

Both Egypt and Turkey have recently been able to tap dollars more cheaply through sukuk.

The desire among political and financial leaders in Beijing to climb the value chain in development finance is clear. But the challenges now facing a giant Chinese state-run infrastructure contractor at Nigeria’s new deep-water port in Lekki show that this is easier said than done.

Gains written on banks’ equity book values from long dollar positions could be quickly wiped out if borrowers prove unable to service debt at a higher exchange rate.

Across the Middle East and North Africa, Egypt and its banks boast august credentials when it comes to climate and sustainability. But frameworks and agreements are one thing, creating substantive change across an entire financial sector is quite another.

A groundbreaking repo facility for African sovereign Eurobonds was completed in time for a debut trade as COP27 took place. The road to closing the deal was far from simple.

Boutique investment bank DAI Magister suggests donor funds could catalyse private equity and debt investment in climate tech, the big theme of COP27.

As European and Chinese banks scale back in Africa to cut costs and redeploy capital to core markets, Middle East lenders are happily jumping in to fill the gap, buying assets and putting more boots on the ground as bilateral trade between the regions increases.

Egypt’s supportive regulation, together with the impact of Covid, saw cashless payments in the country grow by more than 230% last year. Now fintechs, banks and state-owned platforms all want a piece of the action.

As legacy banks plough billions into fintech, their valuations – especially compared to standalone fintech players – are far from seeing the desired benefit. Spin-offs and subsidiary IPOs are part of a growing push to make these fintech investments more independent and visible, and to force a sum-of-parts valuation. Is the answer to restructure into a listed financial holding company, of which the legacy bank would just be one part?

Fonsis is an interesting sovereign wealth fund, operating a fund-of-funds model to help the country’s SME development while generating an industry around the management of private capital.

Increased intracontinental trade in Africa is a laudable objective, but may serve to highlight disparities in exchange-rate regimes that could further widen the gap between winners and losers.

South African banks’ sustainable finance challenges reflect the nation’s difficult but vital transition away from coal.

Many parts of Africa present formidable obstacles to financial inclusion. Euromoney speaks to some of the pioneers that are using technology to bring far-flung populations into the financial system.

Can multilateral development banks fight climate change while still promoting economic development in emerging markets? The European Bank for Reconstruction and Development is the first to set out concrete plans on how to do this.

Uche Orji is approaching 10 years as head of the Nigeria Sovereign Investment Authority, a sophisticated institution segregated into three very different funds. Covid spurred a year of outstanding market returns, but now Orji’s focus is on domestic infrastructure before he steps down next year.

African banks have enviable growth prospects, but fintech and regulation are forcing them to look beyond their core businesses.

Hitesh Anadkat has spent the last 25 years building an African SME banking empire from scratch from his base in the Malawian city of Blantyre. His FMB Capital Group now also has operations in Zimbabwe, Mozambique, Zambia, Mauritius and Botswana; and he is looking to gain market share in them all.

The surprise exit of Absa chief executive Daniel Mminele in April, only 15 months into the job, shows how much the South African group is still finding its way in the post-Barclays era. Mminele – Absa’s first black CEO – was seen in some quarters as losing a power struggle against an overwhelmingly white executive team. Can the next chief executive gain the authority to drive Absa’s revival?

Years of tough but successful IMF-led reforms have put Egypt in a great place to rebound strongly from Covid. Its future will be shaped by big infrastructure projects and by a plan to transform the nation into a powerhouse of green finance.

Whether doing a branch network tour or complying with regulation, Bank of Saint Helena boss Josephine George has a job that is like few other bankers’ anywhere.

Banque du Caire was on the cusp of completing a $500 million listing in London and Cairo last year when Covid hit. Its chairman Tarek Fayed meets Euromoney to talk about investing in people and digital – and why he still wants to complete a slimmed-down stock sale when conditions allow.

Emerging markets have regained some of the buoyancy lost during the early months of the coronavirus crisis, but analyst opinions hint at the difficulty of identifying which EM currencies investors should favour.

The rand is back to pre-pandemic levels despite little confidence in the South African government’s ability to revitalize its economy.

The BRICS economies, which between them represent 40% of the world population and 32% of its GDP, are a powerful force for the private banking industry as their economic engines drive wealth creation. But they are all distinct markets with their own unique opportunities and challenges.

As Gulf banks grapple with squeezed margins, low interest rates and over-banking, Egypt offers the opposite: high interest rates, low lending penetration and a largely unbanked population. It is no surprise that domestic and regional buyers are now circling.

The Egyptian bank is to launch a digital bank as Covid-19 accelerates the government’s push for a cashless society.

Africa’s most ambitious homegrown regional bank has a problem, and it is called Nigeria. If it doesn’t solve it, the Nigerian business will hamper Ecobank’s goal of banking 100 million people across the rest of the continent.

Analysts can see through the economic and fiscal shock to observe a country with its underlying strengths intact.

The coronavirus pandemic is intensifying the case for domestic bank M&A in Africa, but cross-border deals will be challenging to execute.

Unquantifiable risk as a result of Covid-19 made the complex deal unworkable.

Experienced mobile money market participants have given a cautious welcome to Ethiopia’s plans to liberalize its telecommunications market, but warn that the emergence of new transaction providers is far from certain.

In this Euromoney Livestream hosted by Euromoney’s Middle East and Africa editor, we discuss why the economic and health implications of Covid-19 have lead to calls for debt relief, what this might look like for Africa's recovery, and how debt management might look in the future.

Mainland Chinese firms invested $72.2 billion in Africa between 2014 and 2018, much of it through the Belt and Road Initiative. Now that Covid-19 has struck, there is a growing sense of unease in Beijing over calls to write off debt to stressed African states.

African governments and SOEs owe China more than $150 billion and Covid-19 is limiting their ability to repay. Will this usher in debt-trap diplomacy or are Chinese lenders playing a longer game?

Covid-19 has refocused attention on the urgent need to address long-term structural healthcare issues in Africa. Investors are now looking to put money to work in healthcare and banks are seeing an uptick in demand for project financing.

Private creditors and the Paris Club have agreed to collaborate on a debt standstill for low-income countries, but the process must be handled with care to avoid being more punitive than helpful.

Citi’s chief executive for Kenya and east Africa tells Euromoney how Kenya’s banks have come together to buy ventilators; how Covid-19 will accelerate the adoption of digital banking; and why the removal of the interest rate cap is more important than ever for Kenya’s SMEs.

EIB looks to help the most vulnerable and to encourage banks to take on more risk as it unveils a €5.2 billion package for non-EU countries.

Amid calls by the UN and the G20 for the private sector to do more, Citi has proposed a $100 billion coronavirus fund.

As Egypt ramps up measures to contain the coronavirus, CIB chairman Hisham Ezz Al-Arab tells Euromoney how the 2011 revolution has left the bank well prepared to deal with the current crisis.

Stakeholders agree that debt relief for Africa is essential, but are mulling what form this might take.

The fall in the oil price will benefit oil-importing countries such as Kenya, but the benefits may be lost because of the African continent's over-reliance on trade with China.

Africa’s oil exporters are feeling the pressure after the crash in the oil price and fears of the coronavirus Covid-19, as investors pull money from international bond markets.

The recent collapse in the oil price and Nigeria's (lack of) reaction to it echoes the way the country dealt with the crisis in 2015. Repetition of the same mistakes will only cause harm for Africa's largest economy.

Some organizations, drawn in by irresistible fees, can’t resist working with high-risk clients – but technology might offer a solution.

Kenyan property developer Acorn Holdings has issued a small but smartly structured bond programme, which will remove barriers to entry for local market bonds as local currency bonds retain appeal.

Ethiopia’s IMF deal is a notable step towards addressing its external imbalances and to opening up the country’s economy.

The bank will open a new office in New York to capture the US market in Africa.

Egypt’s equity market has been slow to recover to pre-revolution levels, but liquidity is returning and companies are lining up to list.

Kenya’s parliament passes a law to lift an interest rate cap that has hampered credit growth and economic development, in a move that may pave the way to a new agreement with the IMF.

A number of contentious political reforms under president John Magufuli have weakened investor enthusiasm for Tanzania in recent years.

Mohamed Maait says that Egypt is committed to implementing the much-needed reforms to drive growth, and is pressing ahead with the sale of several state-owned companies, as it looks to agree new terms with the IMF.

Mobilizing global pension funds could be the key to financing Africa’s $150 billion infrastructure needs, but more investor education is needed to unlock dollar savings globally.

Multilateral Afreximbank is set to become the latest African company to list in London, offering investors a rare chance to take on pan-African exposure, but the mixed performance of recent deals as well as difficult market conditions may make it a tough sale.

The Seychelles was the first country to issue a debt-for-nature swap to protect its marine environment; it was also the first to issue a blue bond, raising capital to finance sustainable marine and ocean-related projects. But can it overcome the teething problems and provide a model other island nations can follow?

The rhino impact bond has sparked excitement that financial tools can play a role in helping Africa conserve its wildlife. As the continent’s population level is set to rise quickly, Euromoney looks at the work being done to connect conservation with economic growth.

The Seychelles will need to tackle its drug problem head on if it wants to develop a thriving blue economy and pay back debt raised from the first ever blue bond.

In Africa, the more democratic a country is, the higher its Euromoney Country Risk score, but as the continent’s ECR grade stalls, African countries are diverging – politically and economically.

Automation and artificial intelligence are transforming the payments industry into one of the most dynamic sectors of transaction banking. But there are still many teething problems in an industry that has been catapulted onto centre stage.

A properly functioning financial system has long eluded the country. As it moves on from Abdelaziz Bouteflika’s 20-year leadership, can the financial system finally overcome its many problems?