Why is the US bullish on Africa?

“The United States is all in on Africa’s future,” Biden told African leaders from 49 countries at a three-day summit in Washington last week. The US-Africa summit aims to position the United States as a partner to African countries amid competition with China, which has sought to expand its influence by funding infrastructural projects on the continent. Currently, Chinese trade with Africa is about four times that of the United States, and Beijing has become an important creditor by offering cheaper loans, often with opaque terms and collateral requirements, than Western lenders.

The US administration believes that Chinese and Russian activities in Africa could have negative long-term consequences for the continent, presenting an opportunity for these countries to challenge the rules-based international order, advance their narrow commercial and geopolitical interests, and undermine transparency and openness.

Officials of the US administration also focused their efforts to improve cooperation with African leaders. The summit resulted in several investment pledges including a 55 billion investment in health, and climate change, amongst other issues, and a $100 million fund for the Young African Leaders Initiative expansion.

IMF agrees to Ghana’s $3bn debt bailout

The International Monetary Fund has agreed to a $3 billion loan to Ghana to get the West African nation’s debt under control, restore financial stability and help people most at risk from rising prices and other economic problems. Ghana has experienced more than 40 per cent inflation, growing debt, and a sharp decline in its cedi currency since the start of the year.

On a brighter note, new data from the Bank of Ghana shows that the Ghanaian cedi’s exchange rate versus the U.S. dollar bounced back from just over 14 units per dollar to 8 units on Friday the 16th of December. According to the report, the exchange rate experienced a 36% appreciation, from 14 units per dollar which earned the Cedi title of the worst-performing currency globally. The central bank attributed the cedis’ recent gains to a new set of monetary measures it has instituted. The currency’s resurgence appears to have been fueled by the announcement of the IMF loan.

World’s longest subsea cable lands in South Africa

MTN GlobalConnect announced that the world’s longest undersea cable, 2Africa, made landfall last week at Yzerfontein and Duynefontein in South Africa. The 2Africa cable will stretch 45,000 km (27,961,704 miles) long, and runs from Europe through the Atlantic Ocean and the Indian Ocean, going completely around the African continent, and then back into Europe via the Red Sea and the Mediterranean.

The cable will serve 33 markets and have at least 47 landing stations. The cable has a design capacity of up to 180 TBps, which is faster than Google’s Equiano cable. The system will deliver much-needed internet capacity, reliability, and improved internet performance across large parts of Africa; and will supplement capacity demand in the Middle East. The 2Africa cable is owned by a consortium that includes firms such as MTN GlobalConnect, Meta Platforms (Facebook), China Mobile International, Orange, center3, Telecom Egypt, Vodafone, and WIOCC.

ICYMI: Market roundup

  • The NGX All-Share Index increased by 0.89% last week to close at 49,316.29 points. The top gainers were Learn Africa plc (28.48%), Thomas Wyatt Nigeria plc (18.75%), Cornerstone insurance plc (13.04%), Coronation insurance (10.81%), and Smart products Nigeria (10.00%). The top decliners were Mcnichols (-11.48%), Academy press (-9.70%), Prestige Assurance (-8.70%), Multiverse mining and exploration (-8.51%), and Axamansard insurance (-8.04%).
  • The naira increased against the dollar from N448/$ to N451.50/$ on Friday at the investor’s and exporters’ window.
  • Brent crude closed the week at $79.04, while US West Texas Intermediate (WTI) crude closed at $74.29.
  • The global cryptocurrency market cap stood at $810.67B, as of 9:41 am Sunday, the 18th of December. Bitcoin reduced by 2.47% to close at $16,756.21 over 7 days, Ethereum dropped 6.84% to close at $1,188.04, and Binance Coin lost 14.66% to close at $247.69.
  • Pan-African VC firm, Ventures Platform, announced the final close of its early-stage and intercontinental fund at $46 million. The new fund will see the VC firm double down on backing a cohort of category-leading companies across the continent and allow for follow-on investments for portfolio companies up to Series A.
  • Kenya-based MyHealth Africa, an integrated healthcare platform changing how people access medical services, by connecting patients with local and international health specialists and hospitals, raised $1 million in seed funding.
  • Taeillo, a Lagos-based Afro-Urban furniture and lifestyle brand, has raised $2.5 million in expansion funding from Aruwa Capital, a Nigeria-based early-stage growth equity and gender-lens fund. 

Elsewhere on Ventures

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