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from Global Investing:

The Sub-Saharan frontier: future generations

As growth in Sub-Saharan Africa is set to post a steady 5-6 percent per annum to 2017 according to IMF estimates,  investors will be taking notes on the region's growth story not least with the financial sector.

Growth projections have rebounded from forecasts of around a 3 percent rise in 2009 after falling commodity prices have hit one of the region's main revenue sources. Yet, according to the World Bank's recent Global Development Finance report, stronger commodities will firm growth prospects in the coming years. In recent weeks, commodities have dipped, dampening the outlook for some resource-rich countries, but as 76 percent of the region's population do not have access to a bank account, lenders are set to grow their presence in the region.

Julius Baer notes the region's market potential:

Since 2002, resource-hungry China has swept across a by-and-large grateful African continent, taking oil and minerals in exchange for debt relief, low-interest loans, or much needed infrastructure, such as roads, ports and housing.

The continent's existing banking sector is nascent, with many payments bypassing traditional deposit methods, instead mobile technologies such as M-Pesa and M-Kesho are the only method of making payments and transfers. On banking Baer had this to say:

from Global Investing:

Ratings more than a piece of paper for Africa

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By Stephen Eisenhammer

Does a sovereign credit rating from a glass tower in London or New York impact life in the country being rated? Apparently in Africa it does.

According to research by the rating agency Fitch, sovereign credit ratings significantly boost foreign direct investment (FDI) to Africa.

from Global Investing:

African growth if China slows

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The  apparent turnaround in Africa's fortunes over the past decade has been attributed to the rise of China and its insatiable appetite for African commodities. So African policymakers, like those everywhere, will have been relieved by the recent uptick in Chinese economic data.

But is Africa's dependence on China exaggerated?  A hard landing in the Asian giant will be an undoubted setback for African finances but according to Fitch Ratings.  it may not be a disaster.

from Global Investing:

And the winner is — frontier market bonds

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Global Investing has commented before on how strongly the world's riskiest bonds -- from the so-called frontier markets such as Mongolia, Nigeria and Guatemala -- have performed.  NEXGEM, the frontier component of the bond index family run by JP Morgan, is on track to outperform all other fixed income classes this year with returns of over 20 percent., the bank tells clients in a note today. Just to compare, broader emerging dollar bonds on the EMBI Global index have returned some 16 percent year-to-date while local currency emerging debt is up 13 percent.

That appetite for the sector is strong was proven by a September Eurobond from Zambia that was 15 times subscribed. Demand shows no sign of flagging despite a default in frontier peer Belize and shenanigans over the payment of Ivory Coast's missed coupons from last year. Reasons are easy to find. First, the yield. The average yield on the NEXGEM is roughly 6.5 percent compared with  just under 5 percent on the EMBIG.

from Africa News blog:

Is Joyce Banda the answer to Malawi ’s problems?

By Isaac Esipisu

The continents’ newest and second Africa’s  female president took over the reins of power in Malawi to offer a new and more responsive style of leadership that is expected to spur economic recovery of one of Africa’s poorest nation. Joyce Banda was sworn in as president two days after President Bingu wa Mutharika died of heart attack at 78.

The new president, Joyce Banda started her presidency in an enthusiastic and robust way; mending ties with foreign donors that could see Malawi pull out of an economic crisis. The new president of Zambia , Michael Sata, is making the transition easier, contributing 5 million litres of petrol that should help the economy. Banda, a 61-year-old policeman's daughter who won recognition for championing the education of underprivileged girls, now enjoys widespread support among a population whose lives grew increasingly difficult under Mutharika

from Africa News blog:

Stumbling block for the Pharaohs?

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Egypt might have won the last two African Nations Cup tournaments but the Pharaohs seem to have hit a stumbling block when it comes to the World Cup.

For all their prowess at the last two continental championships, and their glittering array of successes at club level, Egyptian soccer is becoming increasingly haunted by the spectre of continued failure to make it to biggest footballing showpiece of them all.

from Africa News blog:

Africa still crying for freedom?

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“Sub-Saharan Africa: Year of Regression”. That was the heading used by U.S.-based rights group Freedom House in its survey of political freedom in the world published this week.

Of course the Freedom House survey pointed to the coups in Guinea and Mauritania as well as the situation in Zimbabwe, whose elections were condemned by many countries and where the crisis shows no sign of lessening, but there were plenty of other names on the list too:

from Global News Journal:

How well can African elections work?

By the standards of other recent African elections, the aftermath of Angola's parliamentary ballot at the weekend has been fairly tame.

But polling station chaos that led to an extra day of voting and accusations of cheating from the opposition badly undermined Angola's hope that the ballot would set a example for the continent after elections in Kenya and Zimbabwe.

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