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Five Lessons Evergrande Taught Us About The Chinese Economy

By Abdulazeez KurangaPosted on Posted in Africa & World EconomyTagged , , , , , , No Comments on Five Lessons Evergrande Taught Us About The Chinese Economy

The Evergrande story is bigger than just one company. It’s about China’s unsustainable model of economic growth, which has relied on endless investment and a mad, debt-fueled development frenzy in recent years. That model helped China soar, but the country is now experiencing some turbulence. Last week, some alarmist observers were calling this China’s “Lehman moment” — a reference to the collapse of Lehman Brothers that preceded the 2008 financial crisis — but China-focused economists argue that’s overblown.

Sub-Saharan Africa: We need to act now

By Adebisi SamuelPosted on Posted in Africa & World Economy, AgenciesTagged , , , , , , No Comments on Sub-Saharan Africa: We need to act now

The growth of infections in sub-Saharan Africa is now the fastest in the world, with an explosive trajectory that is outpacing the record set in the second wave. At this pace, this new wave will likely surpass previous peaks in a matter of days—and in some countries, infections are already more than double, or even triple, their January peaks. The latest (delta) variant—reportedly 60 percent more transmissible than earlier variants—has been detected in 14 countries.

The Policymaker’s Trilemma

By Aminu MusaPosted on Posted in Africa & World EconomyTagged , , , , , , No Comments on The Policymaker’s Trilemma

Imagine you’re a policymaker in sub-Saharan Africa. You’ve been charged with lifting your country out of the worst health crisis in living memory, and nobody around you knows when it will end—the second wave that gripped the region earlier in the year has eased, but many countries are nonetheless bracing for further waves as winter approaches.

One piece of good news is that a global recovery is well underway. Key economies are rebounding sharply, global trade has improved, commodity prices are higher, and investment flows have resumed.

The bad news is that, for sub-Saharan Africa, at least, near-term growth prospects are somewhat more subdued. And as long as widespread vaccination remains out of reach, you will face the unenviable task of trying to boost your economy while simultaneously dealing with repeated COVID-19 outbreaks as they arise.

Nigeria: A Frail Giant?

By Fawaz AyobamiPosted on Posted in EconomyTagged , , , , , , , , , , No Comments on Nigeria: A Frail Giant?

Since President Muhammadu Buhari’s re-election in 2019, the country has faced a myriad of social and economic challenges. Inflation had surged from 11.40% in May 2019 to 17.33% last month; the Naira has been devalued three times, losing 33% of its value, insecurity has increased, and the general investment climate has waned. All these have happened while Nigerians have not seen any meaningful increase in their economic welfare: the country slumped into a second recession in five years. Many states have found it challenging to implement the new minimum wage signed into law in 2019. We also note that even if all the states had implemented the new minimum wage, the total number of civil servants to the entire labour force is considerably low. To sum it, you would still be worse off if you hold 2X the same Naira note you had in 2010 today.

Time is Ripe for Innovation in the World of Sovereign Debt Restructuring

By Joshua OlorunsaiyePosted on Posted in AgenciesTagged , , , , No Comments on Time is Ripe for Innovation in the World of Sovereign Debt Restructuring

When corporations have too much debt and need to restructure it, creditors often end up exchanging bonds or loans for stocks. They trade the guaranteed payout of a fixed-income investment for an equity position whose return depends on the company’s future results. In other words, investors accept to share risk. Could a similar mechanism be applied when a sovereign nation has to restructure its debt, tying payouts to its future economic performance?

Fiscal Policy for an Unprecedented Crisis

By Joshua OlorunsaiyePosted on Posted in AgenciesTagged , , , , , No Comments on Fiscal Policy for an Unprecedented Crisis

The COVID-19 crisis has devastated people’s lives, jobs, and businesses. Governments have taken forceful measures to cushion the blow, totaling a staggering $12 trillion globally. These lifelines have saved lives and livelihoods. But they are costly and, together with sharp falls in tax revenues owing to the recession, they have pushed global public debt to an all-time high of close to 100 percent of GDP.

China and the Burgeoning African Debt Crisis

By Aminu MusaPosted on Posted in Africa & World EconomyTagged , , , , , , , No Comments on China and the Burgeoning African Debt Crisis

Contrary to the swirling rumors on African social media and in the local press about the supposed imminent danger of Chinese asset seizures in Zambia, it’s not the Chinese that are the problem here… it’s bondholders on Wall Street and in The City.

COVID-19 Crushes Global Economy but Emerging Markets are in Bigger Troubles

By Ahmed AkinyelePosted on Posted in Africa & World EconomyTagged , , , , , , No Comments on COVID-19 Crushes Global Economy but Emerging Markets are in Bigger Troubles

By 2021, it is of high expectation that the world will return to normalcy, and economies around the world should recover from the adverse effect of coronavirus spread. However, emerging markets may continue to wallow in economic crisis as contemporary issues like weak GDP growth rate, unemployment rate, high debt profile, income inequalities, among others, remain in the picture, most of which have been worsened by the global pandemic effects.

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