Africa

🇲🇬 Madagascar’s President Andry Rajoelina has maintained a strong lead in preliminary results from the country’s election held last week, with over 60% of the vote. The election was marked by a low turnout and claims of voter bribery by Rajoelina’s party. Ten of the 12 opposition candidates called for a boycott of the polls over what they termed an ‘institutional coup’ in support of the incumbent. Rajoelina, a 49-year-old entrepreneur and former DJ, first became president of the island nation in a 2009 coup. Results are expected to be announced on Friday.

🇳🇪 Niger’s ruling junta asked West Africa’s regional court to compel its neighbors to lift sanctions imposed after the country’s July 26 coup. The junta’s lawyer said all sectors within the country had been negatively impacted, citing drug stores that were running out of supplies and businesses shutting down due to rising costs. Niger’s neighbors shut their borders, and Nigeria cut 70% of the electricity supply to the country. The lawyer for West Africa’s regional body Ecowas argued that the junta is not recognized under the bloc’s protocol and does not have the power to institute such a case in court. The court adjourned until Dec. 7.

🇬🇭 Ghana’s cocoa regulator Cocobod secured a $800 million loan for cocoa purchases from farmers at almost 8%, the highest interest rate on record, Bloomberg reports. Sources privy to the transactions said eight participating banks, including Rabobank as lead arranger, Standard Chartered and Societe Generale would provide the loan. Ghana, the world’s second-biggest cocoa producer, usually signs the syndicated facility in September before the new harvest begins in October. However, this year’s negotiations were delayed by the country’s debt restructuring that was needed to unlock a $3 billion government bailout from the IMF.

🇲🇱 Mali has signed an agreement with Russia to build a gold refinery in the capital Bamako, the West African country’s military government said. The facility, capable of processing 200 tonnes per year, would be Mali’s largest gold refinery. Mali has used Russian private military force Wagner to fight Islamist insurgents. The group has lucrative mining deals in various African countries. The gold refinery deal is a non-binding memorandum of understanding that is valid for four years. A Malian minister announced the deal in an interview broadcast on state television on Tuesday but did not provide a timeline for construction.

The number of mining licenses revoked by the Nigerian government because its holders failed to pay annual service fees. More than 80% of the licenses affected were for exploration and small scale mining, said Minister of Solid Minerals Dele Alake. The process of revoking more than 2,213 licenses started in October, with 580 license holders responding within a mandatory 30-day period to clear their fees. The action, Alake said, was driven by Nigeria’s aim to “sanitize” its mining sector for international competitiveness.

Nigeria’s Access Bank plans to launch in Asia in first quarter of 2024

THE SCOOP

LOME, Togo — Lagos-based Access Bank, one of Africa’s biggest banks, is close to finalizing a regulatory process to launch its first full banking service in Asia in the first quarter of 2024, the chief executive of its holding company told Semafor Africa.

The Asian bank plan is part of a wider global expansion target which includes a strategy to expand more deeply into Francophone Africa, build closer ties with North Africa, and across Europe where it already has wholesale banking operations in London and Paris, which opened in May.

Herbert Wigwe, chief executive of Access Holdings, parent company of Access Bank, said he and his team expect to receive approval from monetary authorities “by this side of Christmas.” Wigwe declined to confirm the country in which the bank would launch in order to avoid preempting local regulators, but he added: “We will definitely be in Asia by the first quarter of next year.”

Access has used a wholesale banking model outside of Africa, which is a corporate to corporate approach rather than retail banking with individuals.

KNOW MORE

Wigwe and his team have built Access from a small Nigerian operator into the largest banking group in the country through an aggressive and ambitious acquisitive approach. The lender accounts for 16% of the banking system’s assets at the end of 2022, according to ratings agency Fitch.

It has also expanded rapidly across the continent over the last half decade. Most recently, it snapped up the banking operations of Standard Chartered in Angola, Cameroon, The Gambia, Sierra Leone, and Tanzania.

Access, which had 21.3 trillion naira ($26.5 billion) in total assets on its balance sheet at the end of September, has seen its share price double on the Lagos stock exchange since the start of the year to give it a market capitalization of around 614 billion naira ($762 million).

YINKA’S VIEW

The rise of Access Bank since it was taken over in 2002 by Herbert Wigwe and his partner Aigboje Aig-Imoukhuede has been remarkable. But it’s the ambition of their strategy that is worth paying more attention to because it makes an unabashed and long-term bet on Africa and African businesses on the global stage.

Wigwe explains the move for Asia as serving their customers who operate in those regions. “The big advantage is we gain access to capital and trade; these are trade hubs where people come from across the continent, set up businesses, and trade from there — so we’re following that chain of trade,” he told me.

He sees an Asia bank “supporting overall network effects” in terms of what customers already do in the region. But, most importantly, he emphasized the ability to access “huge pools of capital” which would typically be unavailable in African markets. “So by being present in these markets, there is a brand recognition and a real business supporting trade.”

Tax incentives by South Africa’s government have driven a sharp rise in the importation of solar panels, providing an alternative source of electricity to the nation’s ailing coal-powered utility. A major shift started in 2021 when private companies could add their solar-generated electricity to the official grid, according to research by BloombergNEF.

New taxes this year allowed businesses to reduce their taxable income base by 125% and for individuals to claim 25% rebates, for investments in renewable energy. Some $700 million worth of panels were imported from China in the first half of 2023 alone. The country is expected to add 3.5 gigawatts of residential and commercial solar power annually between 2023 and 2025. But a full transition away from the 43-gigawatt coal-based electricity infrastructure to renewables could require investment of $136 billion, BloombergNEF projects.

The Nigerian central bank’s decision not to hold its monetary policy committee this week has deepened uncertainty over how its new governor plans to tackle the currency crisis in Africa’s biggest economy.

It was the second time the meeting failed to take place since Yemi Cardoso took office in September. It also comes against a backdrop of chronic dollar shortages that have pushed down the value of the naira and driven galloping inflation.

President Bola Tinubu moved decisively in his first weeks after coming to power in May to roll out investor friendly reforms. He removed a costly fuel subsidy and allowed the naira’s value to be market determined. Godwin Emefiele, who as central bank governor implemented unconventional policies, was replaced with Tinubu’s choice, Cardoso, a former chairman of Citibank Nigeria.

But, two months into his tenure — a long time for global investors — Cardoso is yet to hold a meeting of the bank’s monetary policy committee (MPC). The meeting typically culminates in the governor announcing the decision on the main lending rate and policy plans. The meetings are usually held every two months. A meeting had been due to take place on Monday and Tuesday this week, according to the central bank’s website.

Comparisons have been drawn with Kenya’s central bank governor, Kamau Thugge, who was appointed in June and hiked the country’s main interest rate by 100 basis points in an unplanned meeting one week after taking office, prompting a dip in inflation.

“You can engender investor confidence by having predictable policies and knowing the central bank’s plans,” said David Omojomolo, Africa economist at Capital Economics in London. “We haven’t got a clear sense of what Cardoso is trying to achieve.”

The bank did not respond to a Semafor Africa request for comment about the meeting.

Nigeria’s inflation rate rose for a tenth month in a row in October to 27.33%, the highest in 18 years. Economists broadly agree the orthodox way to tackle price rises would be to raise the benchmark interest rate.

— Alexis

An animated film co-directed by a South African duo won this year’s International Emmy for Best Kids’ Animation. The winners were announced during the 51st edition of the awards held in New York on Tuesday. “The Smeds and the Smoos”, currently streaming on Showmax, explores the ability of love to transcend individual differences. It was adapted from a bestselling children’s book with the same name by writer Julia Donaldson and illustrator Axel Scheffler. The screenplay was written by South African writer Julia Smuts Louw.

• For people who worry about AI destroying the world, “the last few days have been confusing and alarming,” Tom Chivers wrote.
• Renewable energy companies are lobbying U.S. financial regulators over proposed rules they fear would hammer their businesses and slow the rollout of green power.
• Eight weeks out from the first presidential primary contest, Donald Trump is doing only what he has to, while three far-behind rivals are trying everything.

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— Yinka, Alexis, Alexander Onukwue, Martin Siele, and Muchira Gachenge