2018 second-quarter forecast

Sub-Saharan Africa

Sub-Saharan Africa is a study in diversity. Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, the region is home to countless cultures, languages, religions, plants, animals and natural resources. It’s no surprise that it captured the imagination of Europe’s earliest explorers — and that it continues to capture the imagination of current world powers eager to exploit it. And yet despite the region’s diversity, Sub-Saharan African countries have common challenges — transnational terrorism, rapid population growth, endemic poverty and corruption — that prevent them from capitalizing on their economic potential. The coming years will be critical for the region, especially as its political institutions mature in a rapidly globalizing world.

8 MINS READMar 9, 2018 | 18:21 GMT
Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, Sub-Saharan Africa is home to countless cultures, languages, religions, plants, animals and natural resources.
(Radek Borovka/Shutterstock.com)

Covering an area that spans the entire width of the continent beginning at the Sahara Desert and ending at the southernmost tip of South Africa, Sub-Saharan Africa is home to countless cultures, languages, religions, plants, animals and natural resources.

section Highlights
  • In southern Africa, new leaders will try to chart a fresh course for their countries with ambitious reforms and appeals for foreign investment.
  • President Joseph Kabila will continue to cling to power in the Democratic Republic of the Congo as he imposes new levies and royalties on his country's lucrative mining sector.
  • As militant groups in the Sahel region gain skills and recruits, the Group of Five Sahel Force and France's Operation Barkhane will face additional hurdles in their fight against insurgency and extremism.
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Southern Africa Grapples With Political Change

Much of the attention in sub-Saharan Africa this quarter will be focused on the region's southern states. Leadership transitions in South Africa, Zimbabwe and Angola will continue to take those countries in new directions.

In South Africa, President Cyril Ramaphosa — who entered office after his predecessor, Jacob Zuma, stepped down Feb.14 under pressure from the ruling African National Congress (ANC) — will try to steer the government on a new course. Ramaphosa will try to use the power of the presidency to halt the ANC's drift into corruption and ineffectiveness. He will also try to jump-start South Africa's flagging economy, an endeavor that will require fostering more policy certainty in important sectors such as mining. At the same time, Ramaphosa and the ANC will strive to maintain the populist policies necessary to appeal to the ruling party's voter base ahead of the next presidential election in 2019. That means finding a way to expropriate land, for example, without jeopardizing food security or spooking investors.

Achieving these two priorities will be difficult for the new administration. Nevertheless, Ramaphosa's rise in the ANC will breathe new life into the party and stall its decline in popularity, if only temporarily. After gaining ground with voters over the past few years, South Africa's main opposition party, the Democratic Alliance, will come under fire in the second quarter over the water shortage in Cape Town. The city's water supply will remain strained at least until the rainy season begins in April or May, giving the ANC political ammunition to use against the Democratic Alliance, which has been in power in Cape Town for over a decade.

Cape Town Water Supply

The opposition in Zimbabwe, meanwhile, will face its own share of challenges in the second quarter. President Emmerson Mnangagwa has secured his place at the head of the ruling Zimbabwe African National Union-Patriotic Front (ZANU-PF), having taken over his country's top office in November 2017 after longtime President Robert Mugabe resigned under the threat of a coup. In the next few months, Mnangagwa will try to lay the groundwork for a ZANU-PF victory in elections scheduled for August. Winning is, of course, a priority for the ruling party, but so is maintaining the appearance of a fair election. Western countries, after all, will be watching the contest and will base their support for Mnangagwa on whether he and the ruling party keep the elections aboveboard. The opposition Movement for Democratic Change, however, may not pose much of a threat this time around, since the Feb. 14 death of leader Morgan Tsvangirai has left the party reeling. Even so, Mnangagwa probably will do what he must to ensure ZANU-PF's continued dominance, despite his public calls to make Zimbabwe more democratic.

In Angola, too, a new leader is asserting his power. Joao Lourenco, who won the presidency in late 2017 following Jose Eduardo dos Santos' retirement after nearly 40 years in office, already has removed his predecessor's children from their posts at the head of Angola's crucial state oil company and as chief of its sovereign wealth fund. Next, he will turn his attention to improving the oil-rich country's financial straits by trying to diversify the Angolan economy. Brazil will help the cause by resuming funding for construction, energy and hydroelectric projects in Angola, a fellow Portuguese-speaking state. The reopened credit lines are just what Lourenco needs to demonstrate that he is pushing his country forward, and he will continue the conversation with his Brazilian counterpart, Michel Temer, during a visit in May to Brazil.

The Congolese Government Digs In Its Heels

Just north of Angola, the Democratic Republic of the Congo will grapple with a different challenge in its own political transition. President Joseph Kabila — now in his 18th year in power — has continuously postponed the end of his tenure in office over the past two years. His administration will stick with the strategy in the coming quarter, suppressing dissent to his rule while keeping up the appearance that it is trying to move forward with the transfer of power. Though the government in Kinshasa will tout its alleged success registering voters for the next election, scheduled for December, the financial and logistical obstacles that stand in the way of the vote loom as large as ever. The president's fractious alliance, moreover, has yet to name a successor to run in the race, and it's doubtful one will emerge by July, as the coalition claims. Otherwise, Kabila may appoint a weak successor to act as a puppet ruler while he continues to pull the strings, as a recent restructuring in the ruling party suggests he will. Either way, odds are that the results of the election will be severely flawed — if the contest goes forward as planned.

In the meantime, the Congolese government will take on a bigger role in the vital mining sector. Parliament passed new levies and royalties on minerals in January, and Kabila has announced his intention to sign them. The new measures could have global repercussions, since the country is a leading source of copper and cobalt, essential minerals for electronics manufacturing and battery production. Forced negotiations or international arbitration with the government stemming from the legislation will signal increased uncertainty in a sector that so far has largely escaped the political upheaval in the Democratic Republic of the Congo.

Nigeria: Obstacles to Prosperity

Nigeria's critical oil sector, by contrast, could have another quiet quarter. The militant groups of the oil-rich Niger Delta region have so far refrained from staging any attacks on energy infrastructure this year, though outfits such as the Niger Delta Avengers have expressed their dissatisfaction with government peace talks. Nigeria's government will try to maintain the uneasy calm in the region, with help from falling inflation and austerity measures that will give it more resources to devote to appeasing Niger Delta militants. Yet the threat of attacks will continue to hang over the country's oil industry.

Besides militancy in the Niger Delta, the government in Abuja will have other issues to worry about in the months ahead. The next presidential election in 2019 fast approaches, and all signs indicate that President Muhammadu Buhari will run for a second term. Winning re-election promises to be a steep task, though, given the lingering concerns over Buhari's health and skepticism over his handling of Nigeria's financial troubles. Yet Buhari may still be the strongest candidate in the ruling All Progressives Congress, possessing enough clout to unify the party and secure the support of its powerful northern factions. Doubts about the president's fitness and competence may cause more ambitious politicians to defect from the All Progressives Congress to the opposition People's Democratic Party, which has nominated a candidate from northern Nigeria, Buhari's home turf, to try to split his support base.

Security in the Sahel

Militant Violence in the Sahel

Nearby in the Sahel region, security will continue to be the primary focus. The next few months will test the mettle of the Group of Five Sahel Force, a joint security effort among Burkina Faso, Chad, Mali, Mauritania and Niger. Though seven of the force's battalions are supposed to be up and running by the end of March, operational problems will limit their effect on the region's degrading security. Violent extremist organizations in the Sahel have cultivated the expertise necessary to execute more sophisticated attacks on Malian and international forces through their ties to the Islamic State and al Qaeda in the Islamic Maghreb. The transnational militant groups, in turn, are redoubling their recruitment efforts in the region. As militancy spreads in the Sahel, it will put more strain on Operation Barkhane, France's anti-insurgency campaign in the area, and on Malian President Ibrahim Boubacar Keita's race for re-election. In an effort to undermine the legitimacy of the country's polls and institutions, extremist groups probably will ramp up their attacks as the election, set for July, approaches.

Ethiopia Minds Its Dam Business

East Africa also will be a battleground, albeit a figurative one, in the second quarter. Various countries in the Arab Gulf and beyond are vying for influence in the Horn of Africa and deepening their ties to its states. But the region's most prominent project this quarter is a local initiative: Ethiopia's multibillion-dollar Grand Ethiopian Renaissance Dam, which will be the largest hydroelectric dam in sub-Saharan Africa. Tentatively scheduled for completion by the end of this year, the dam will be a major boon for Ethiopia, helping to alleviate its electricity shortage while also drawing the eye of foreign investors such as China. The government in Addis Ababa hopes that the increased funding could subsidize future projects to connect the landlocked country's 100 million citizens to the Red Sea.

The Grand Ethiopian Renaissance Dam

While the dam represents a major achievement for Ethiopia — and good news for Sudan, which stands to benefit — for Egypt, it's an unwelcome development. The North African state, downstream from the dam, has feared the project's effects on its water supply since Addis Ababa first announced the venture in 2011. The dam also highlights just how much influence Egypt has lost over its upstream neighbors. With these issues in mind, Cairo will continue to resist the project in the second quarter and beyond. Its efforts, however, will be in vain. Egypt lacks the leverage to bend Ethiopia to its will and, in fact, will have to return to the negotiating table with Addis Ababa in time.

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