The Editorial Team |

African Leader Son’s Multimillion-Euro Splurge on $80,000 a Year

Equatorial Guinea (Capital Markets in Africa) – The son of Equatorial Guinea’s president bought real estate, a Bugatti Veyron, a Cartier watch and bottles of prestigious Romanee Conti wine on his $80,000-a-year position as a government minister. French prosecutors are demanding he account in court for these and other purchases, which total more than 100 million euros ($112 million). Teodoro Nguema Obiang Mangue, agriculture minister for more than a decade, is accused of amassing real…

Beware MSCI’s Inertia If You’re Tracking Its Indexes: Macro View

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LAGOS (Capital Markets in Africa) – MSCI’s decision to delay the return of Argentina to emerging-market status while extending a lifeline to Nigeria means investors may be shut off from the benefits of Mauricio Macri’s reforms, while remaining subject to the impact of policy inaction from Muhammadu Buhari. The Argentina decision could spark a selloff in the country’s stocks, ironically making it more difficult for authorities to maintain capital-market freedoms. Macri has ended a decade-long battle with creditors and embarked on…

South Africa Central Bank to Fight `Unlawful’ Mandate Proposal

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JOHANNESBURG (Capital Markets in Africa) – South Africa’s central bank accused the graft ombudsman of overreaching her powers and promised to fight a proposal to change the institution’s primary objective of protecting the value of the currency. “The Reserve Bank has consulted its legal team and has been advised that the remedial action prescribed by the Public Protector falls outside her powers and is unlawful,” the Pretoria-based central bank said in a statement on its website. Public…

Bank of England Governor’s Brexit Worries Mean BOE Chief in No Rush to Tighten

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LONDON (Capital Markets in Africa) – Mark Carney is still worried about the impact of Brexit on the economy and signalled he won’t be rushing to raise interest rates anytime soon. In his first major comments in six weeks, the Bank of England governor addressed weaknesses in the economy, saying that domestic inflation pressures remain subdued and wage growth is anemic. He also highlighted the level of uncertainty surrounding the U.K.’s talks to exit the European Union, saying he…

South African Airways in Talks With Banks as Deadline Looms

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JOHANNESBURG (Capital Markets in Africa) – South African Airways is in talks with lenders about reviewing the terms of 9 billion-rand ($692 million) worth of loans due at the end of the month, and may have to tap government debt guarantees that are keeping the state-owned airline in operation. One bank has told SAA that it wants to be repaid by the end-June deadline, the Johannesburg-based carrier said Monday, without giving further details. Standard Chartered Plc refused…

Nigeria’s Half-Measures on Currency Are Only Half-Working

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LAGOS (Capital Markets in Africa) – A year after Nigeria scrapped a currency peg that sent foreign investors fleeing, it’s still battling to entice them back. But trying to placate investors by introducing multiple exchange rates isn’t going to work, bond funds and Wall Street lenders including Citigroup Inc. say. To end the dollar shortage that has hamstrung West Africa’s biggest economy and oil producer, President Muhammadu Buhari and central bank Governor Godwin Emefiele will have to weaken the naira’s official rate again,…

The Leader Who Caused a Slump: Zuma Blamed for South Africa Mess

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JOHANNESBURG (Capital Markets in Africa) – The last time South Africa fell into recession, in 2009, it was because of the global financial crisis. This time around, economists and business executives agree, the cause is a person: the president. Jacob Zuma’s erratic political moves are breeding policy uncertainty and reluctance to invest, helping explain why the economy of the continent’s most industrialized nation contracted for a second straight quarter in the three months through March. Finance,…

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