Tag: Mauritius

  • The Exit Problem: Are African Markets the Solution?

    The Exit Problem: Are African Markets the Solution?

    Contributed by Kyle Schutter, a Partner at Grant & Co.

    To go public, or not…

    I attended the Ibuka accelerator, a program to help get private companies listed,  kickoff event in October at the Nairobi Securities Exchange.

    The Kenyan stock exchange, being the largest in the region, is worth a close look.

    The requirements for listing in Nairobi are minimal and it is not nearly as hard to list as people make it out to be. A company needs only 1 year of track record, doesn’t need to be profitable, only needs to list 15% of its shares, only needs a capitalization of about $100,000, and only needs to have 25 shareholders within a few months of listing.

    So why aren’t more companies doing it?

    The Lagos, Johannesburg, Mauritius, and Nairobi stock exchanges are the most promising places to go public in Africa. We will focus on the Nairobi Securities Exchange as a case study to enable us to deep dive.

    Note: nothing here should be construed as an insult to Africa, Kenya, or the Nairobi Securities Exchange. I love Kenya and hope to work together to find solutions that keep increasing investment in and wealth of Africa.

    Brand Problem

    Listing is only one part of the problem; you must have someone buy your shares. Is there a market that wants to buy shares in these particular companies?

    Kenyan equities (stocks) have not performed well, underperforming against bonds land, and even savings accounts. This isn’t a recent phenomenon, although the current economic downturn has worsened it. It has been going down for 8 years.

    Source: Hass Consult

    The NSE 20 index is down from 6,000 in 2015 to 1,400 in 2023. 

    Why take more risk with equities and get a lower return?

    So, the brand name of Equities in Kenya and Africa is generally not good. What factors lead to this, and how can it be fixed?

    Remember, Investing is a Keynesian Beauty Contest: the goal is not to pick the most beautiful investment but to pick the one that others think is the best. If Kenyan Equities have a bad brand and investors don’t think others will pick them, then no one will pick them, and they will go down.

    Too hard to list… or too easy?

    The requirements of the NSE (Nairobi Securities Exchange) are very entrepreneur-friendly, probably too friendly. There are two ways exchanges should maintain quality: ethics and financial performance. The NSE could improve on both accounts.

    Ethics: the NSE has frozen the shares of Mumias and Kenya Airways, which prevents shareholders from liquidating their shares and props up the companies so they can keep operating rather than declare bankruptcy.

    Financial Performance: Other stock exchanges delist companies if their share price or market capitalization falls too low. The electric scooter startup, Bird, once valued at $3.2b has now been delisted from NYSE because it failed to maintain the $15m market cap minimum threshold and has since gone bankrupt. Stocks that fall below $1.00 per share on the NYSE are also delisted. NSE could also set a minimum price to encourage management to improve performance or face the consequences of being delisted.

    A leadership problem?

    The Ibuka event had an enthusiastic vibe but maintained certain unfortunate* African stereotypes: the event started 1 hour late, and the presentation contained a major data inaccuracy. Timeliness and data integrity must be core to the culture of a stock exchange. *I likely maintained certain American stereotypes at the event: incessant, obnoxious questions. C’est le vie.

    This suggests room for improvement in the NSE company culture and, consequently, for leadership improvement. According to publicly available information, the outgoing CEO of the NSE made Ksh31m (~$210,000), a 19% increase over the previous year, all while making only Ksh14m (~$100,000) for the exchange in profit, a drop of 90% from the previous year. This suggests a problem with his compensation package (and the compensation structuring at the NSE).

    Overall, the NSE Equities market has been down since the NSE CEO was appointed 9 years ago, while the Kenyan economy has grown at ~5% a year. Having met him briefly, I had the impression the CEO of the NSE was more of a politician than a visionary who made things happen. Subsequent conversations with market players have not changed that impression.

    A new CEO has been appointed as the current CEO has ended his two 4 year terms. Hopefully, new leadership will improve the company culture and results. But this 4-year term suggests more room for improvement: why not have the CEO’s tenure be based on performance? Stock exchanges like NYSE don’t have specific terms for their CEOs. But, perhaps the NSE is a quasi-parastatal. And with the “prestige” associated with running a public market there is a risk that new appointees will be based more on politics than competence and compensation will not be tied to results.

    Furthermore, 8 years isn’t enough time to turn something around. A true visionary would want 15 good years to build something great. Imagine Steve Jobs had to leave Apple in 2005 before the iPhone came out. Or Elon had to leave before the Model S came out? The 2×4-year term could be disposed of.

    The newly appointed CEO looks to be a strong choice. He is a lawyer/accountant and Partner from EY. We were hoping for an entrepreneur. Hopefully, he will be an entrepreneurial lawyer/accountant.

    Capital flight?

    Another explanation for poor NSE performance is that foreign investors are leaving the African stock markets, especially the Kenyan stock market.

    However, the Ksh 125b loss due to foreign investors leaving is only part of why the NSE has lost Ksh 1.5 trillion in value since 2021. Capital flight explains less than 10% of the story.

    Anti-Free Market behavior

    Here are two examples:

    • The NSE has frozen the trading of Kenya Airlines and Mumias, both of which have substantial government ownership. Kenya Airlines shares have been frozen for 4 years, renewed annually each year with the explanation that Kenya Airways needed time to restructure. In 2022, Kenya Airways lost about $40m. In 2023, they lost about $150m. The more time they get to restructure, the worse it gets. Both companies should go bankrupt, and shareholders should be able to sell their shares. The exchange freezing shares makes investors nervous. By comparison, the NYSE only froze trading for 1 day, and that was when the World Trade Center buildings were attacked in 2001.
    • That the CEO of the CMA has attempted to put price floors on stock prices is concerning. “Capital Markets Authority (CMA) chief executive Wycliff Shamia told the Star that the move has been necessitated by the fact some of the companies have very strong fundamentals but the valuation is quite low.” Yes, this is how free markets work. The market decides what something is worth, not the government. The latter would be communism.

    Preference for other investments

    Investors would rather speculate on land because Kenya has no property tax. GoK should fairly tax other parts of the economy, like creating a 0.1 to 1% annual Property Tax on land so that people can’t just sit on their land and speculate without contributing to the economy. All other developed and emerging economies have an annual Property Tax; it’s time Kenya did the same. Property tax is generally recognized as the least bad tax for economic growth and yet Kenya doesn’t have it and isn’t even considering it. See here how property tax could be implemented in Kenya and make all parties happy. With the devolved county governments, this could more easily be accomplished than in the past.

    The effect of no property tax is clear in the numbers: Kenyan real estate is 75x bigger than equities ($678b vs $9b); meanwhile, by comparison, US real estate is only 2x bigger than US equities ($96T vs $46T). The US equities market sources capital from around the world because people trust Uncle Sam to treat equities fairly, but people don’t (yet) trust Uncle Kamau to do the same. I think the lack of Property Tax is the nail in the coffin of the NSE, and without this reform, there can be no vibrant equities market. (Note: the only meaningful property tax that exists is the capital gains tax when a property is sold, and even then, people can easily underreport the sale price, which is much harder to do on a public equities market. Some counties like Nairobi charge property tax at around $5-30 per year, which is a joke. There is also a tax on Rental payments, but this is not a tax on the property but a tax on a business being done on the property, making matters worse by disincentivizing property development.)

    Because Treasury Bonds are over 15%, investors put their money there rather than risk equities. Hopefully, after the Eurobond payment in June 2024, Treasury yields will reduce and more money will flow back to the equities market.

    The opportunity

    But there are reasons to be bullish on African stock markets. African markets, excluding South Africa, have a relatively small proportion of their GDP trading. There is room for the equities market to grow 10x to align with other markets like the US, South Africa, and India.

    Source: Wikipedia and related exchanges

    Further, Kenya is the region’s largest and most liquid market and could be a regional player—it is already one of the most liquid markets in Africa. By aggregating regional companies onto its exchange, NSE could grow another 10x. On top of that, GDP will compound to 63% growth over the next 10 years. This brings the total NSE market cap potential to ~630x growth over the next 10 years… if NSE can play its cards right. 630x growth would put the NSE in line with India, so it’s not impossible, as discussed below.

    On top of that, Annual Turnover (trading of the shares) is relatively low compared to other markets at 4.7% on NSE, ~40x less trading than the US, adjusted for market cap.

    There is room for more economic activity on African stock markets.

    So where is this 630x growth going to come from?

    1. Increase valuation. The P/E (price to earnings) ratio is only 4.9 on NSE, a sign that investors have low growth expectations. This is half its historical level and 1/4th the ~20 P/E seen on US exchanges, a 4x growth potential for NSE stocks. This is due to uncertainty, low expectations, and discounting for inflation.
    2. More companies listing. About 1% of US companies are publicly listed compared to 0.001%ish (my guesstimate) of Kenyan companies. Realistically, 10x growth potential (as most Kenyan businesses are too small to go public).
    3. NSE quality. If the NSE can improve quality that will improve investor confidence and 2-10x growth.
    4. Virtuous Cycle. There are the compounding effects of a growing market, generating interest and crowding in more capital.
    5. Encourage international investors on local trading platforms. Currently, American, Canadian, Singaporean, and other foreign investors are discouraged from investing through existing brokerage channels and online trading platforms as the regulations in those countries are too costly to manage given the small public market. But as the market grows and trading platforms enable more foreign investors you can imagine that as returns are becoming more predictable with lower returns in the West, some intrepid investors will take an interest in Africa. 2x opportunity
    6. Distribution on international trading platforms. Like Robinhood, Charles Schwab, etc. 10x opportunity.
    7. Cross-listing from other countries in East, Central, and Southern Africa. Theoretically, a 10x opportunity, but in reality, maybe a 2x. Already, some of this is happening. Bank of Kigali (Rwanda) and Umeme (Uganda) are listed in their own countries but cross-listed on NSE. Crosslisting is relatively easy. Evidence suggests that cross-listing increases company valuation, so the cost of cross-listing more than pays for itself. (Source: Peristiani, Federal Reserve Bank of New York, 2010) Old Mutual, for example, is cross-listed on 5 exchanges. A Kenyan equities lawyer confirmed this would be a workable strategy.
    8. Behavioral nudges. There is no way for Kenyan trading apps to automatically reinvest dividends, while automatic reinvestment of dividends is possible in other markets like the US. This could boost share price by 5% per year. This would cut out stock brokers and their fees. My little research online suggests the CMA (Capital Markets Authority) currently prevents automatic dividend reinvestment due to pressure from stock brokers.
    9. Better trading UX. New trading apps that make it easy to buy shares can 2x capital yet again. I tried to sign up with 6 different trading apps and brokers. 3 didn’t allow Americans, Dutch, Singaporeans, or Canadians to trade. The others each had cumbersome documentation requirements: one required a scanned copy of a notarized copy of my passport. What’s the point of a copy of something notarized? The friction to buy shares as a foreigner or local is severe.
    10. Reduced trading fees. This is the big one. CDSC and other government entities can reduce the tax on trading, which is currently at 0.36%. If a stock is only expected to gain 10% a year, paying 0.36% per trade precludes an efficient market that quickly buys and sells. For comparison, the NYSE has a fee on trades of $0.001 (which comes to 0.003% for a typical $30/share stock, 1/100th the price of Kenyan fees). Broker fees are also extremely high in Kenya at 1-1.5%, 10x higher than in the US at 0-0.1%. Reducing fees would not directly increase market cap, but a 10x reduction in fees might increase liquidity 10x, bringing the NSE more in line with other exchanges, from 4.7% turnover to perhaps 50% turnover. Increasing liquidity would perhaps increase the market cap by 2-10x by increasing P/E and crowding in more companies.
    11. Improving taxation. Right now, US investors in Kenyan companies get taxed twice. Thus, going through Mauritius is advantageous.

    Case study 1:

    I tried to sign up for various trading apps (Exness, Sterling, AIB-AXYS, ABC). Finally, after a week I was able to sign up on EFG Hermes. I tried to trade using the Market Price but the Market Price was 2x the Limit Price. I was told by customer service to ignore the Market Price. Once I did make a trade it took two days for my trade to be reflected in the app. After many customer service requests, my trade was reflected but then the app showed I had a negative account balance. After another customer service call that has been fixed. Then my password stopped working.

    I can see why there might not be a lot of retail investors in Kenyan securities as the buying experience does not inspire confidence. But it does show an opportunity for someone to build a better trading experience.

    Why are companies resistant to going public?

    Before we determine whether listing at all would benefit companies, let’s consider:

    • does going public preclude a company from raising additional institutional capital?
    • what are the tax implications?
    • what are the compliance costs?
    • with interest rates as they are, is now really the right time to list?

    Treasuries are 15% in Kenya at the moment, so raising equity is a hard sell. But global interest rates are unlikely to stay high, so perhaps a reduction down to 10% in the coming years will be good for equities. Also, land prices, the other investment option, may run out of room to grow further as rural land prices in Kenya are already about the same as rural land prices in the US, channeling more investment to equities.

    Compliance costs are Kenyan SMEs’ most commonly cited problem for not listing. However, the compliance costs in Kenya are typically only around $5,000 a month, which they should be doing even as a private company, like maintaining a board of directors and informing shareholders of material changes. Thus, this argument from SMEs doesn’t hold water. 

    In an IPO, a company would sell at least 15% of its shares to raise additional capital. Some companies might be concerned with how they can raise more capital after the IPO. Never fear! There are several options:

    • Corporate Bond: this is just a loan with a maturity. Of note, there is no collateral required for this. Also, it has a bullet payment at the end, which gives the company some breathing room on repayment.
    • Private placement: a select group of investors are invited to buy shares in the company. This can be done even before a public offering and provides more privacy for the company.
    • Rights Issue: this is where shares are offered to existing shareholders only so they are not diluted. This funding method is fairly common in Kenya, though not as common in the US.
    • Secondary Offering: just like a rights issue but open to anyone. This is common in the US. Tesla, for example, has had 8 Secondary Offerings since 2012.
    • All-stock acquisition: not strictly raising capital, but a public company can issue new shares to buy another company without spending cash. For example, Facebook’s acquisitions of WhatsApp and Instagram were mostly paid for in shares. Berkshire Hathaway makes its acquisitions this way, or through retained earnings (reinvested profits) rather than through Secondary Offerings.

    Kenya has many advantages over other markets:

    • Recently, an app developed for retail investors called Dosikaa (I wrote the first review for it on the Play Store—it didn’t work for me) enables anyone to buy shares. Once Dosikaa works out the bugs, this greatly improves the share-buying UX, instead of going to a broker and signing a paper.
    • Kenya doesn’t limit foreign ownership in most companies (aside from banks and telcos) thus, international capital could invest in NSE-listed companies, while other African countries often have more restrictions on foreign ownership.
    • Increased liquidity and market capitalization compared to most other African exchanges.

    There are also downsides:

    • registering a company in Kenya doesn’t have the same tax advantages as Mauritius
    • it doesn’t have nearly the same market depth as Johannesburg or other exchanges. Jumia, despite doing most of its business in Egypt, Kenya, and Nigeria, chose to list on the NYSE. JMIA once traded at $60/share but fell 20x. I bought some shares there at $2.5 last week. Let’s see if they can bounce back. Jumia raised more money on the NYSE than it could have on the NSE, but Jumia also might not have lost as much value if it had been listed in an African market. Local buyers in Kenya would have seen the value it creates by direct interaction on the ground. Thus, there are advantages to listing in Africa vs. New York.

    One possible tax-efficient structure might be to register the holding company in Mauritius, list it in Mauritius, and then cross-list it to NSE (and other African exchanges) to increase liquidity.

    Kenyan stocks have more government and founder ownership than the US; the US has more Retail, ESOP, and ETF (e.g. Index Fund) ownership than Kenya. (Source: CMA and TPC)

    Case Study 2: 

    Flametree, listed on NSE GEMS (the growth board), has an equity value of around $10m, with sales growing about 25% a year. Flametree is a holding company that owns ~15 common spice, shampoo, and water tank brands in Kenya and other African countries. The CEO owns 84% of the company. The market cap is around $1.5m, the P/S is 0.05, P/B is 0.3–this would seem to be a very good buy. The CEO pays himself about $180,000 a year, which seems fair for a company of this size. But Flametree hasn’t paid dividends in years and the CEO has no incentive to. So the shares are kind of stuck in limbo, even as they are undervalued; since the CEO owns 84% there is no opportunity for a hostile takeover. The share price has declined about 90% since listing in 2014.

    Case Study 3:

    Equity Bank vs. KCB. 

    Equity Bank has a P/E of around 3.4 while KCB is around 1.8. Both seem undervalued. However, they have fairly different shareholdings. Largest investors:

    Equity

    – Arise BV (owned by Dutch and Norwegian Development finance institutions)

    – James Mwangi (founder and CEO)

    KCB

    – Government of Kenya

    – NSSF (social security)

    Does ownership by a DFI and the founder help maintain the share price of Equity Bank?

    I bought both Equity and KCB in December. Let’s see how they do.

    Is a stock exchange ‘fit for purpose’ in Africa?

    Just like mobile money in the US looks very different than mobile money in Africa (Venmo vs. Mpesa), perhaps funding large companies faces an analogous problem. Currently, African public markets are roughly a copy/paste of systems that work in the US. But the chances that a market with vastly less wealth, trust, and education would have the same optimal solution seems…small.

    For example, NASDAQ was not even considered a stock market when Apple used it to sell its shares. It was considered an electronic over-the-counter (OTC) system typically reserved for the purgatory of penny stocks. But now it has risen to be the world’s second-largest exchange.

    What would the African version of NASDAQ look like? 

    The EABX OTC system received regulatory approval on Feb 1, 2024. An OTC system for SACCO shares has also been created by Sacco Shares Exchange and SakoSoko.

    MPesa was developed and funded by foreigners; Equity Bank, to this day, has a disproportionate amount of foreign shareholders.

    What could a fit-for-purpose capital market look like? How can international Development Finance Institutions help?

    Criticism of this article

    Due to the nature of this article, many people have written comments to me directly rather than post them publicly. While the majority of comments were positive, I’ll focus on the critical ones here:

    • You are biased and you promote American Exceptionalism [that is, that Americans are somehow better than others.] NSE and the US stock market are not comparable in any way.
      • My goal is not to insult Kenya with this piece; I love Kenya and hope we can do better. I compared the NSE to the NYSE but could as easily have compared it to the Bombay Stock Exchange. NSE could serve all of Africa’s 1.4 billion people just like India’s stock exchanges serve 1.4 billion Indias. India is one country compared to 54 in Africa, but it is divided by religion, language, and culture just like Africa. BRSV exchange works across 7ish countries in West Africa so there’s no reason we can’t do the same in the east. The cross-listing seems like the low-hanging fruit where companies in Rwanda, Zambia, etc cross-list to NSE. We would see more of this if the NSE was more vivacious. So I’m not advocating that we should be like Americans but that there’s existing proof that it’s possible to be better.
    • You cherry-picked your data.
      • After asking for better data, none was shared.
    • CMA is doing a great job of reforming the public markets for the better.
      • When I requested examples, none were shared.

    Macro trends

    There is a trend globally for reduced public market listings. The number of IPOs in the US and UK has halved over the last 25 years.

    This is reflected in Kenya where there have been no IPOs for a while, but in just the first half of 2023, there were 34 Private Equity deals worth $1.3b.

    As the world becomes flatter, there is consolidation. Why list on the London Securities Exchange when you could list on Euronext or Nasdaq?

    Therefore, there is a now or never, go big or go home for the NSE. If it doesn’t become a regional player it will be eclipsed by Mauritius, Johannesburg, Bombay, Euronext, or Nasdaq.

    Go regional or become irrelevant.

    Conclusion

    Why don’t the public markets get fixed in Africa?

    Fixing the capital markets starts with quality:

    • Rebrand the NSE as the African Stock Exchange and implement the below changes to become a regional player.
    • The most important and urgent problem is NSE leadership. The board is currently selecting a new CEO. A lot depends upon this choice. We need a visionary.
    • NSE (Nairobi Securities Exchange) can delist companies trading below $1m market cap, below Ksh 10 per share, or have less than 25% freely floating shares.
    • NSE can maintain a culture of timeliness and data quality.
    • CMA (Capital Markets Authority) can revoke stock broker licenses for trading apps with less than 99% uptime.
    • The government of Kenya can let the shilling float freely to eliminate the black market for currency and restore investor confidence.
    • GoK can fairly tax land which will drive more investment to productive parts of the economy like equities.
    • GoK can reduce interest rates on Treasury bonds. At 15% people would rather buy treasuries than take additional risk for the same (or even less) return on the stock exchange.
    • Reduce trading fees. CDSC, NSE, brokers, and government entities can reduce fees that currently preclude an efficient market and high turnover.
    • Let the free market do its job: Unfreeze listings like Mumias and Kenya Airways and the regulator, the CEO of CMA, could avoid saying things that sound communist.
    • Sell off parastatals and partially government-owned companies. The government of Kenya can sell KenGen and Safaricom to pay off its debt and let companies operate more efficiently on the public markets and in private hands.
    • Allow automatic dividend reinvestment: Public companies can create DRIPs (Dividend Reinvestment Programs) to increase demand for shares by automatically reinvesting dividends
    • Develop a built-for-Africa solution. Innovators and entrepreneurs can consider what an African-native solution to public markets might be that looks very different from the public markets we have in the West.

    Together, these actions would instill confidence in investors and companies, local and foreign.

    Improving the public markets could be a win for everyone. A big win that could 10x the economy. A win for investors, companies, stock brokers, the NSE, international development organizations, and the Kenyan government revenue collection.

  • Perspective pour 2024 : Une Année d’Élections en Afrique

    Perspective pour 2024 : Une Année d’Élections en Afrique

    Plus d’un tiers des 50 pays devant organiser des élections cette année se trouvent en Afrique.

    Le président par intérim de l’armée du Burkina Faso, Ibrahim Traoré. Le pays touché par un coup d’État, ainsi que le Mali et le Tchad, devraient voter cette année si les dirigeants de la junte de ces pays restent fidèles à leur parole.

    Cette année sera un record en termes d’élections.

    Au niveau mondial, plus de 2 milliards d’électeurs dans 50 pays se rendront aux urnes, selon le Center for American Progress, un institut de politique américain.

    Les États-Unis, l’Inde et le Mexique font partie des pays qui tiendront des élections nationales en 2024.

    Plus d’un tiers de ces pays, soit plus de 300 millions de personnes, se trouvent en Afrique.

    Les élections les plus attendues en Afrique auront lieu dans l’économie la plus industrialisée du continent et dans une nation majeure d’Afrique de l’Ouest.

    Ces votes, en Afrique du Sud et au Sénégal, font partie des 19 élections prévues en Afrique cette année, représentant également plus d’un tiers du continent.

    La liste inclut également les pays touchés par un coup d’État que sont le Mali, le Tchad et le Burkina Faso, si les dirigeants de la junte de ces pays restent fidèles à leur parole.

    Nous donnons ci-dessous un bref aperçu des pays concernés et des enjeux pour certains d’entre eux.

    1. Sénégal

    Le Sénégal, une nation à l’extrémité ouest de l’Afrique, compte une population de 18 millions de personnes. L’élection présidentielle à venir, prévue pour le 25 février, suscite une attention considérable tant au niveau national qu’international.

    Le président Macky Sall, qui a remporté sa première élection en 2012, s’est adressé à la nation lors de son discours du Nouvel An, soulignant la nécessité d’élections pacifiques après une année turbulente marquée par des violences politiques.

    L’année précédente a été marquée par des manifestations d’opposition ferventes, avec le maire de Ziguinchor, Ousmane Sonko, faisant face à des défis juridiques ayant entraîné son emprisonnement en juillet.

    Malgré les tentatives des autorités de contrecarrer la candidature de Sonko en interdisant une cérémonie de déclaration formelle, lui et ses partisans ont réussi à organiser un événement en ligne sur Facebook le 31 décembre.

    Les observateurs internationaux et les analystes politiques africains expriment des inquiétudes, notant que le Sénégal, autrefois considéré comme un bastion de stabilité en Afrique de l’Ouest, semble naviguer sur un chemin précaire pour son avenir démocratique.

    L’élection présidentielle au Sénégal, prévue pour le 25 février, suscite une attention considérable tant au niveau national qu’international. Crédit image : France24

    2. Mali

    Avec une population de 23,6 millions d’habitants, le Mali se prépare à des élections présidentielles prévues en février. Le pays a connu un coup d’État militaire en 2021, conduisant à la mise en place d’un gouvernement militaire engagé à rendre le pouvoir aux civils. Cependant, des retards répétés dans la programmation des élections présidentielles ont suscité des interrogations.

    Initialement fixés aux 4 et 18 février, les scrutins ont connu des revers, attribués à des problèmes techniques et à un différend avec Idemia, une entreprise française responsable des passeports biométriques et des bases de données d’état civil. En juin, les électeurs ont approuvé une nouvelle constitution, une condition préalable à la tenue des élections. Néanmoins, des inquiétudes persistent parmi l’opposition et la société civile, craignant l’enracinement potentiel de l’influence militaire à travers la nouvelle constitution.

    3. Afrique du Sud

    Célébrant 30 ans de démocratie, l’Afrique du Sud, avec une population de 60,7 millions d’habitants, se prépare à des élections parlementaires prévues entre mai et août. Les élections de 2024 pourraient marquer un tournant significatif, car le Congrès national africain (ANC), le parti de Nelson Mandela, court le risque de perdre un vote national pour la première fois depuis la fin de l’apartheid.

    Les vulnérabilités de l’ANC comprennent des défis économiques, un chômage élevé, des promesses d’infrastructures non tenues, un creusement des inégalités et des accusations de corruption. Le paysage politique devient plus concurrentiel, signalant un potentiel changement dans la dynamique politique du pays.

    4. Rwanda

    Le Rwanda, avec une population de 14,3 millions d’habitants, devrait organiser des élections présidentielles et parlementaires le 15 juillet. Le président actuel Paul Kagame, au pouvoir depuis trois décennies, cherche à prolonger son mandat.

    La période de campagne électorale s’étend du 22 juin au 12 juillet, mais Kagame, historiquement réélu avec plus de 90% des voix, fait face à une concurrence minimale. Le chef du Parti vert, Frank Habineza, est le seul adversaire connu à ce jour.

    Président Paul Kagame du Rwanda. Crédit image: Vanguard News

    5. Tchad

    Avec une population de 18,6 millions d’habitants, le Tchad prévoit une élection présidentielle en octobre. Suite à un récent référendum constitutionnel à la mi-décembre, le leader de la transition, Mahamat Idriss Déby Itno, a nommé Success Masra, un ancien chef de l’opposition, au poste de Premier ministre pour organiser les élections à venir.

    Initialement engagé dans une transition de 18 mois vers des élections, le gouvernement de Déby a prolongé le délai jusqu’en 2024, lui permettant de se présenter à la présidence. Les groupes d’opposition avaient appelé au boycott du référendum, citant des préoccupations concernant l’influence de la junte sur le processus.

    6. Tunisie

    La Tunisie, qui compte 12,5 millions d’habitants, devrait organiser des élections présidentielles en octobre

    Le président actuel Kais Saied, élu en 2021, a accru ses pouvoirs et est candidat à la réélection. Les élections locales en janvier, y compris la sélection d’un nouveau Conseil régional créé récemment, serviront de test pour l’opposition, qui revendique une marginalisation par le régime.

    Bien que Saied soit prévu pour remporter la victoire, une crise économique croissante, marquée par l’inflation et le chômage, constitue un défi important pour sa campagne en vue d’un éventuel second mandat.

    7. Ghana

    Le Ghana, avec une population de 34,4 millions d’habitants, se prépare à des élections présidentielles et parlementaires le 7 décembre.

    Le président sortant Nana Akufo-Addo, arrivant au terme de deux mandats, se retire, et le Parti patriotique national au pouvoir vise un troisième mandat consécutif sans précédent.

    Le vice-président Mahamudu Bawumia a obtenu la nomination présidentielle du parti au pouvoir, préparant la scène pour une confrontation avec le candidat du Congrès démocratique national de l’opposition, l’ancien président John Dramani Mahama.

    Les défis économiques, dont une dette substantielle, exacerbent l’incertitude entourant les élections au Ghana.

    Au Ghana, le président sortant Nana Akufo-Addo, arrivant au terme de deux mandats, se retire, alors que les défis économiques, dont une dette substantielle, exacerbent l’incertitude entourant les élections. Crédit image : Vatican News

    8. Algérie

    L’Algérie, avec une population de 46 millions d’habitants, prévoit des élections présidentielles en décembre. Abdelmadjid Tebboune, au pouvoir depuis quatre ans, a succédé à Abdelaziz Bouteflika, destitué en avril 2019 suite à des manifestations contre sa candidature à un cinquième mandat. Le vote de 2019, lié à Bouteflika, a fait l’objet de boycotts généralisés.

    Le mouvement du Hirak, instrumental dans la destitution de Bouteflika, a diminué depuis la période de la COVID-19. Malgré cela, l’Algérie affiche un taux de croissance de 4,2%, d’importantes réserves de change et d’impressionnantes exportations non pétrolières, contrecarrant la tendance plus large en Afrique.

    9. Comores

    Avec une population de 860 000 habitants, les Comores se préparent à des élections présidentielles le 14 janvier.

    10. Togo

    En anticipant des élections parlementaires début 2024, le Togo, avec une population de 9,2 millions d’habitants, est sur le point de vivre une transition politique.

    11. Mauritanie

    La Mauritanie, qui compte 4,9 millions d’habitants, devrait organiser des élections présidentielles le 22 juin. Le processus électoral jouera un rôle crucial dans la formation du paysage politique du pays.

    Les élections togolaises devraient avoir lieu début 2024. Crédit image : EWN

    12. Mozambique

    Le Mozambique, avec une population de 34,4 millions d’habitants, est programmé pour les élections présidentielles et de l’Assemblée de la République le 9 octobre. Les résultats électoraux influenceront la gouvernance et l’orientation politique de la nation.

    13. Botswana

    Le Botswana, avec une population de 2,7 millions d’habitants, prévoit des élections parlementaires en octobre. Le paysage politique de cette nation stable d’Afrique australe est en attente de changements potentiels.

    14. Soudan du Sud

    Le Soudan du Sud, qui compte 11,2 millions d’habitants, prévoit des élections présidentielles et parlementaires en décembre. Les élections surviennent dans un contexte de défis, dont les troubles économiques et l’impact plus large de la pandémie mondiale et de la guerre Russie-Ukraine.

    15. Madagascar

    Madagascar, avec une population de 30,7 millions d’habitants, se prépare à des élections parlementaires prévues en mai. La dynamique politique de cette île de l’océan Indien sera scrutée pendant ce processus électoral.

    Une personne tient une pancarte avec une photo du capitaine Ibrahim Traoré lors d’un rassemblement de partisans de la junte du Burkina Faso pour marquer le premier anniversaire du coup d’État ayant porté Traoré au pouvoir à Ouagadougou, au Burkina Faso. Crédit image : REUTERS/Yempabou Ouoba

    Dates à annoncer :

    16. Burkina Faso

    Avec une population de 22 millions d’habitants, le Burkina Faso est sous la domination d’une junte dirigée par le capitaine Ibrahim Traoré depuis 2022. La junte promet un retour à la démocratie avec des élections présidentielles provisoirement prévues pour juillet 2024. Cependant, l’augmentation des attaques djihadistes peut remettre en question le calendrier, suscitant des incertitudes quant aux élections.

    17. Maurice

    Maurice, avec une population de 1,3 million d’habitants, se prépare à des élections parlementaires. Le paysage politique de cette île de l’océan Indien devrait connaître des changements à travers ce processus électoral.

    18. Namibie

    La Namibie, avec une population de 2,6 millions d’habitants, prévoit des élections présidentielles et parlementaires. Les résultats électoraux influenceront la gouvernance et les politiques de cette nation d’Afrique australe.

    19. Guinée-Bissau

    Avec une population de 2,2 millions d’habitants, la Guinée-Bissau se prépare à une élection présidentielle. Les développements politiques dans cette nation d’Afrique de l’Ouest seront étroitement surveillés tant sur le plan régional qu’international.

    Malgré l’instabilité politique dans certaines régions de l’Afrique, le continent devrait être la deuxième région à la croissance la plus rapide en 2024, après l’Asie, selon l’Unité de renseignement économique de The Economist.

    De plus, sept des dix économies connaissant la croissance la plus rapide au niveau mondial cette année, comme prédit par le FMI, se trouvent en Afrique.

  • 2024 Outlook: A Year Of Elections In Africa

    2024 Outlook: A Year Of Elections In Africa

    More than a third of 50 countries expected to hold elections this year are in Africa. 

    Burkina Faso’s military interim President Ibrahim Traore. The coup-hit country, along with Mali and Chad are expected to vote this year if the junta leaders in those countries stay true to their word.

    This year will be a record-breaking one for elections. 

    Globally, more than 2 billion voters in 50 countries will head to the polls, according to The Center for American Progress, a US policy institute.

    The United States, India, and Mexico are among the countries holding national elections in 2024.

    More than a third of those countries – with over 300 million people – are in Africa. 

    The most anticipated elections in Africa will take place in the continent’s most industrialized economy and a major West African nation.

    Those votes — in South Africa and Senegal — are among 19 polls scheduled in Africa this year, also over a third of the continent.

    The list also includes coup-hit Mali, Chad, and Burkina Faso – if the junta leaders in those countries stay true to their word. 

    We provide a quick rundown of the countries below and what’s at stake in some.

    1. Senegal

    Senegal, a nation on the westernmost tip of Africa, boasts a population of 18 million people. The upcoming presidential election, scheduled for February 25, is generating significant attention both domestically and internationally.

    President Macky Sall, who secured his initial election victory in 2012, addressed the nation in his New Year’s speech, emphasizing the need for peaceful elections in the wake of a turbulent year marked by political violence.

    The preceding year witnessed fervent opposition protests, with Ziguinchor mayor Ousmane Sonko facing legal challenges that resulted in his imprisonment in July. 

    Despite authorities’ attempts to thwart Sonko’s candidacy by banning a formal declaration ceremony, he and his supporters managed to host an online event on Facebook on December 31. 

    International observers and African political analysts express concerns, noting that Senegal, once regarded as a bastion of stability in West Africa, appears to be navigating a precarious path for its democratic future.

    Senegal’s presidential election, scheduled for February 25, is generating significant attention both domestically and internationally. Image credit: France24

    2. Mali

    With a population of 23.6 million, Mali is poised for a presidential election expected in February. The country underwent a military coup in 2021, leading to the establishment of a military government committed to transitioning power back to civilian rule. However, repeated delays in scheduling presidential elections have raised eyebrows.

    Initially set for February 4 and 18, the polls faced setbacks, attributed to technical issues and a dispute with Idemia, a French company responsible for biometric passports and civil registry databases. In June, voters approved a new constitution, a prerequisite for conducting elections. Nonetheless, concerns linger among the opposition and civil society, fearing the potential entrenchment of military influence through the new constitution.

    3. South Africa

    Celebrating 30 years of democracy, South Africa, with a population of 60.7 million, is gearing up for parliamentary elections expected between May and August. The 2024 elections could mark a significant turning point, as the African National Congress (ANC), the party of Nelson Mandela, faces the risk of losing a national vote for the first time since the end of apartheid.

    The ANC’s vulnerabilities include economic challenges, high unemployment, unfulfilled infrastructure promises, widening inequality, and accusations of corruption. The political landscape is becoming more competitive, signaling a potential shift in the country’s political dynamics.

    4. Rwanda

    Rwanda, with a population of 14.3 million, is set to hold presidential and parliamentary elections on July 15. Incumbent President Paul Kagame, in power for three decades, seeks to extend his tenure.

    The electoral campaign window spans from June 22 to July 12, but Kagame, historically reelected with over 90% of the vote, faces minimal competition. Green Party leader Frank Habineza is the sole known challenger as of now.

    President Paul Kagame of Rwanda. Image credit: Vanguard News

    5. Chad

    With a population of 18.6 million, Chad is anticipating a presidential election in October. Following a recent constitutional referendum in mid-December, transitional leader Mahamat Idriss Déby Itno appointed Success Masra, a former opposition leader, as prime minister to organize the upcoming elections.

    Originally pledging an 18-month transition to elections, Déby’s government extended the timeline to 2024, enabling him to run for president. Opposition groups had called for a boycott of the referendum, citing concerns about the junta’s influence over the process.

    6. Tunisia

    Tunisia, home to 12.5 million people, is expected to hold presidential elections in October. Incumbent President Kais Saeid, elected in 2021, has increased his powers and is a declared candidate for reelection. Local elections in January, including the selection of a newly created Regional Council, will serve as a test for the opposition, which claims marginalization by the regime.

    While Saeid is anticipated to secure victory, a growing economic crisis, marked by inflation and unemployment, poses a significant challenge to his campaign for a potential second term.

    7. Ghana

    Ghana, with a population of 34.4 million, is gearing up for both presidential and parliamentary elections on December 7.

    Incumbent President Nana Akufo-Addo, completing two terms, steps down, and the ruling New Patriotic Party seeks an unprecedented third consecutive stint in power.

    Vice-President Mahamudu Bawumia secured the ruling party’s presidential nomination, setting the stage for a face-off with the opposition’s National Democratic Congress candidate, ex-president John Dramani Mahama.

    Economic challenges, including a substantial debt load, exacerbate the uncertainty surrounding the elections.

    In Ghana, incumbent President Nana Akufo-Addo, completing two terms, steps down as economic challenges, including a substantial debt load, exacerbate the uncertainty surrounding the elections. Image credit: Vatican News

    8. Algeria

    Algeria, boasting a population of 46 million, is expecting presidential elections in December. Abdelmadjid Tebboune, in power for four years, succeeded Abdelaziz Bouteflika, ousted in April 2019 amid protests against his bid for a fifth term. The 2019 vote, linked to Bouteflika, faced widespread boycotts.

    The Hirak movement, instrumental in Bouteflika’s ousting, has waned since the COVID-19 period. Despite this, Algeria exhibits a growth rate of 4.2%, substantial foreign exchange reserves, and impressive non-hydrocarbon exports, challenging the broader African trend.

    9. Comoros

    With a population of 860,000, Comoros is preparing for a presidential election on January 14.

    10. Togo

    Anticipating parliamentary elections in early 2024, Togo, with a population of 9.2 million, is poised for a political transition.

    11. Mauritania

    Mauritania, home to 4.9 million people, is set to hold presidential elections on June 22. The electoral process will play a crucial role in shaping the country’s political landscape.

    Togolese elections are expected to be held in early 2024. Image credit: EWN

    12. Mozambique

    Mozambique, with a population of 34.4 million, is scheduled for both the presidential and Assembly of the Republic elections on October 9. The electoral outcome will influence the nation’s governance and policy direction.

    13. Botswana

    Botswana, with a population of 2.7 million, expects parliamentary elections in October. The political landscape in this stable Southern African nation is poised for potential shifts.

    14. South Sudan

    South Sudan, home to 11.2 million people, anticipates both presidential and parliamentary elections in December. The elections come amid challenges, including economic turmoil and the broader impact of the global pandemic and the Russia-Ukraine war.

    15. Madagascar

    Madagascar, with a population of 30.7 million, is preparing for parliamentary elections expected in May. The political dynamics in this Indian Ocean island nation will undergo scrutiny during this electoral process.

    A person holds a sign with a picture of Captain Ibrahim Traore while attending a rally by supporters of Burkina Faso’s junta to mark the one-year anniversary of the coup that brought Traore to power in Ouagadougou, Burkina Faso. Image credit: REUTERS/ Yempabou Ouoba

    Dates to be Announced:

    16. Burkina Faso

    With a population of 22 million, Burkina Faso has been under the rule of a junta led by Captain Ibrahim Traore since 2022. The junta promises a return to democracy with presidential elections tentatively set for July 2024. However, increasing jihadist attacks may challenge the timeline, raising uncertainties about the polls.

    17. Mauritius

    Mauritius, with a population of 1.3 million, is set for parliamentary elections. The political landscape of this Indian Ocean island nation is likely to witness changes through this electoral process.

    18. Namibia

    Namibia, with a population of 2.6 million, anticipates both presidential and parliamentary elections. The electoral outcome will influence the governance and policies of this Southern African nation.

    19. Guinea Bissau

    With a population of 2.2 million, Guinea Bissau is gearing up for a presidential election. The political developments in this West African nation will be closely monitored both regionally and internationally.

    Despite political instability in some of Africa’s regions, the continent will be the second-fastest growing major region in 2024 after Asia according to the Economist Intelligence Unit.

    In addition, seven out of the top 10 fastest-growing economies globally this year, as predicted by the IMF, are in Africa.