Direct and indirect foreign investors fled from Africa as the credit crisis sparked a flight to safety, or at least familiarity, but Ayo Salami, manager of the Duet Victoire Africa Index fund believes domestic demand can step in to underpin growth.

African governments have been hit hard by a withdrawal of investor money from the continent and need to make sure they remember reforms and avoid high inflation in their attempts to protect their economies, says Razia Khan, head of Africa research at Standard Chartered Bank in London.

Africa gets 3 percent of the world’s cross-border flows, but BIS end-2008 data shows the region suffered the world’s largest decline in cross-border financing due to the global financial crisis, Khan told a breakfast audience of politicians, bankers, investors and journalists in London today.

Africa needs the economic environment that will lure investors back in, she says.

“Financial markets in Africa have not shown signs yet of a significant recovery. “Maybe there is going to be some longer-term support for commodity prices, but governments have to guard against a deterioration of the fundamentals that have been in place to support growth,” she says.

Across sub-Saharan Africa, South Africa will withstand the global recession better than other countries, she adds.

“African growth is still likely to be positive, but macro-economic stability is more of a risk in some countries than in others.”

President Barack Obama’s choice of Ghana for his first visit to sub-Saharan Africa since taking office has stirred debate in his father’s homeland Kenya.

Some Kenyans believe Obama ought to have come “home” first. Others, especially among critics of President Mwai Kibaki’s government, say he has deliberately shunned the country to show U.S. disapproval of rampant corruption and nepotism in political circles here.

Prime Minister Raila Odinga, who comes from the Luo ethnic group like Obama’s father, said it was wrong to read too much into Obama’s itinerary, given that neither was he visiting other influential nations in the region like South Africa and Nigeria.

“Ghana is symbolic. It was the first African country to gain independence from Britain in 1957. Ghana is very advanced in its transition to democratic form of governance. So it is perfectly logical,” he told Reuters.

“If Obama were to come to Kenya as the first country in Africa, it would send some very wrong signals that he is coming here merely because of some organic relationship that he has with this country. So in fact it is good.”

Obama has been to Kenya several times, most recently as a senator in mid-2006. In a speech then, he took a strong line against corruption, which has plagued East Africa’s largest economy for decades. “If the people cannot trust their government to do the job for which it exists - to protect them and promote their common welfare - then all else is lost. That is why the struggle of corruption is one of the great struggles of our time,” he said.

That speech drew a sharp response from the government. Spokesman Alfred Mutua called Obama a young man who was “very poorly informed” and chided him for “lecturing” Kenyans. When Obama took power, however, the Kibaki government was so happy it announced a national holiday in his honour. The U.S. leader is wildly popular among all sectors of Kenyan society.

So should Obama have included Kenya on his Africa tour? Is he snubbing his ancestral homeland?

Few investors dispute the view that Nigeria’s banks look
cheap at the moment, with most of the major players trading at a
discount to book value and with earnings multiples way below
consumer stocks such as Guinness Nigeria.
 
Nor is anybody arguing against the long-term logic of the
financial sector’s potential growth in an oil-rich country of
140 million people but only 23 million bank accounts.
 
A new central bank head with a background in risk management
is also making all the right noises about improving the sector’s
notoriously murky financial disclosure - part of the reason the
shares crashed so spectacularly in the latter half of 2008.
 
Furthermore, Lamido Sanusi’s stated desire to relax limits
on foreign ownership has breathed new life into the view that
another wave of consolidation, this time involving major global
players, sits around the corner.
 
Does all this sound - like so many other Nigerian promises of easy money - too good to be true,
or are its banks set on a long-term trajectory that will ultimately see them realise the dream of making Lagos a financial hub to rival Johannesburg?

The debate around the vuvuzela was always going to generate big noise but for some South African commentators it has become almost a neo-colonial conflict.

The noisy trumpet, which dominates the sound waves around the stadiums during the Confederations Cup, has got a lot of people covering their ears.

Complaints from TV viewers across Europe have been vociferous enough for the future of the plastic pest to become the major item on the agenda at the series of press conferences FIFA president Sepp Blatter has held during the tournament in South Africa.

Blatter has said it will stay — he wants to celebrate local custom and is inviting the rest of the world to do so too.

FIFA’s television arm, HBS, are more cautious but say privately, at the end of the day what Blatter says goes.

The European TV stations, who pay a lot of the money that funds FIFA, Blatter and the World Cup, could have the vuvuzela banned if they bleated enough. But most of the noise, so far, has come from enraged South Africa columnists, who have rounded on the poor Dutch journalist who first sought Blatter’s response to complaints from European television viewers.

In Africa, there is a sensitivity to being told what to do from outside and a pride in seeking to create a unique World Cup in 2010. Some of the stuff written though has been a little churlish. See here, here and here for a flavour.

At the end the day, it is the big TV money that talks. If the world’s broadcasters feel the cacophony of vuvuzelas detracts from the viewing pleasure of their public, FIFA will be forced to back down and ban the trumpets from the 2010 World Cup stadiums.

It won’t have anything to do with any ‘ism, just cold hard cash.

South African President Jacob Zuma has a tough balancing act to perform as he begins his term in office.

 On the one hand, Zuma is anxious to assure investors that there will be continuity in the economic policies that have secured the country’s status as the regional powerhouse.

On the other, he has to address the increasingly vocal demands of his allies in the labour movement, whose support propelled him first to the leadership of the ruling ANC and then to the country’s top government job after April 22 elections.

But what the unions want - increased social spending to cushion their members against the ravages to the global recession that has now also landed in South Africa - would mean veering away from the prudent fiscal stance that has ironically cushioned the country from the worst of the world crisis.

Investors are also keen to see whether Zuma bows to pressure not to renew the contract of central bank Governor Tito Mboweni, loved by financial markets but vilified by unions that say a pre-occupation with inflation targeting has seen the Reserve Bank maintain a tight monetary policy at the expense of economic growth, impoverishing millions.

Can Zuma please one side without alienating the other? And if it comes down to choice, will the President opt to sacrifice his alliance with the Left to maintain South Africa’s international standing? How essential is union support for his success as President and can the ANC stay in power without it?

Nigeria marks its first 10 years of unbroken civilian rule on Friday after emerging from nearly three decades of uninterrupted military dictatorship on May 29, 1999.

The political elite in Africa’s top oil producer are rolling out the drums to celebrate the milestone.  And why not?

Olusegun Obasanjo, a former military ruler who won elections in 1999, ended Nigeria’s pariah status and brought Africa’s most populous nation back into the international fold, helping secure an $18 billion debt write-off in 2005.

Power was then transferred to President Umaru Yar’Adua in 2007 - the first successful transition from one civilian leader to another since independence from Britain in 1964 - although the election was condemned by observers for widespread rigging.

Soldiers have so far stayed put in their barracks during the historic decade, despite mounting frustrations among ordinary people - most of whom live on less than $2 a day - that their lives are not changing quickly enough for the better.

Cause for celebration, given Nigeria’s post-independence history, when the army exploited such frustrations to truncate the First Republic in 1966 and the Second Republic in 1983.

But while the great and the good celebrate, many ordinary Nigerians feel indifferent about the landmark.

The poorest say democracy has done little to change their standard of living. The huge earnings from Nigeria’s mainstay oil and gas industry are still not improving their lives.

There is much greater freedom of speech and of association, but some say the only tangible change in their daily lives over the past decade has been the arrival of the mobile phone.

Critics say Obasanjo’s high-profile campaign against corruption - the monster that had held Nigeria back for decades - was little more than a weapon against his enemies.

Initial optimism over his tenure gave way to a feeling that he was just as overbearing and kleptocratic as his predecessors.   

Yar’Adua’s assumption of power two years ago was seen as a breath of fresh air, but again Nigerians have been left wondering whether their optimism was misplaced.

 Economic reforms have slowed, infrastructure remains shambolic in large parts of the country and electricity supply remains as intermittent as it was a decade ago, despite Nigeria being the world’s eighth biggest exporter of crude oil.

In moments of desperation, some even wonder if the country was better off under military rule. So where does the truth lie?

How much has Nigeria really changed in the decade since military rule?  Has the country come too far for it to be conceivable that the military could one day take power again, or does democracy still have only a fragile hold on the giant of Africa?

Nigeria’s security forces have been carrying out their biggest co-ordinated operation for more than a decade – and possibly since the Biafran war – in the Niger Delta this month, using helicopters, aircraft and gunboats as well as three battalions of ground troops to try to flush militants and criminal gangs out of the creeks around Warri.

The military says it has destroyed camps belonging to Government Tompolo in Delta state which were seen as a key training ground for rebel fighters and a hub of oil bunkering – the theft of industrial quantities of crude oil worth millions of dollars a day – in the western delta.

Major-General Sarkin-Yaki Bello, who commanded the operation, has said he ordered a pinpoint helicopter attack on Tompolo’s home in the village of Oporoza on May 15. Local residents said a traditional festival was being held at the time and that hundreds fled into neighbouring communities. They say innocent civilians were killed.

Some Ijaw community leaders have accused the military of a targeted ethnic campaign as soldiers entered remote communities in the delta’s mangrove creeks to try to hunt down suspected gang members believed to have gone into hiding.

But many Nigerians say the military operation was long overdue. Residents in parts of the Niger Delta say their lives have been blighted by the rising criminality of armed gangs masquerading as political militants in recent years, and see the gunmen are plain criminals who are no longer fighting for their cause.

The lower house of parliament has urged the military to extend its campaign to destroy militant camps in other parts of the Niger Delta.

Tompolo, who has amassed a personal fortune from bunkering, appears to have been abandoned by other militant factions in neighbouring Rivers and Bayelsa states, with the main retaliatory attacks on the oil industry so far confined to the area around Warri in Delta state and apparently carried out by his own gunmen.

Was the military right to strike Tompolo’s camps? Does the apparent destruction of “Camp 5” make the western delta a safer place for the oil industry and local residents, or will it radicalise angry youths and win them over to the militants’ cause?

Should the military extend its offensive to known militant camps in Bayelsa and Rivers states, or would that stir the hornets’ nest and trigger an upsurge in violence and sabotage of industry installations across the Niger Delta?

As Somalia goes up in flames again , fingers are being pointed at Eritrea for its alleged role in fuelling the conflict.  East African regional body IGAD and the continent-wide African Union have both called for sanctions on Eritrea - including a no-fly zone and blockade of its ports - for allegedly supplying arms and equipment to Al Shabaab and other militant Islamist insurgents fighting Somalia’s interim government.

The accusations have been around for years, and have surfaced in U.N. reports on breaches of a weapons embargo for Somalia.
 
Asmara says its arch-enemy Ethiopia is driving the accusations, helped by CIA agents in the region, and denies it has given any material aid despite its antipathy towards President Sheikh Sharif Ahmed’s government.

Asmara says the government, formed in January during a U.N.-brokered process in Djibouti, is an illegitimate administration imposed by foreign powers. It challenges its critics to produce hard evidence, and says the accusations are particularly hypocritical given Ethiopia’s recent armed intervention in Somalia.

Analysts say the spat plays into the wider, unfinished conflict in the region between Ethiopia and Eritrea. They fought a border war between 1998-2000 - just a few years after Eritrea won its independence from Ethiopia - and their armies still face each other, while the governments spit enmity between them.
 
So who is right? How can the rest of the world know the truth? What should Eritrea and Ethiopia both do to further peace in Somalia?

The progress of two Nigerian teams into the group phase of the African Champions League defies the supposed impact of the continuing exodus of the country’s top talent to almost every distant footballing corner of the world.

Kano Pillars caused a major upset last month with their shock win over defending champions Al Ahly, albeit on the away goal rule, while Heartland FC eliminated last year’s runners-up Coton Sport of Cameroon at the same stage of the competition. Both results plunged the established order into disarray and offer now the Nigerians a chance to prove their immense resources.

Nigerian club football has had steady representation in the Champions League over the last 13 years but besides Enyimba, the state sponsored team from Aba State, no club has ever displayed title winning potential.

Much of that has to do with the flight of players from the country, off in search of better earnings and opportunity on foreign football fields. There are more than 200 Nigerian footballers playing across the globe, from the top leagues in England, Germany, Italy and Spain to lesser footballing markets like India, Vietnam and even in Albania.

Losing the top 200 players is a massive blow to any country and in particular the domestic championship. Nigeria might have a professional league in name but it is still a shambolic competition, dominated by extreme violence and routine disorgansiation. Attacks on players, coaches and referees remain common place and although there is some TV coverage, much of it is frustratingly haphazard for the broadcaster. The standard too is hampered by poor facilities and the player drain.

Nigeria, given their immense resources, really should be the powerhouse of club football in Africa. But because so many players have left, success for Africa’s most populous nation at club level is infrequent. The progress of Kano Pillars and Heartland FC, neither of whom have ever progressed this far before in the 13 years of the Champions League format, bucks that trend.

It emphasises again the immense potential of Nigerian football, which given its passionate following and playing resources should be the most prominent in Africa. But whether the progress of the pair of the clubs to the last eight of the Champions League, and the elite group field, is an anomaly or not will become evident in the coming months of competition.