World
AfCFTA Will Lift 30m Africans from Extreme Poverty by 2035—World Bank
By Adedapo Adesanya
The World Bank has said the African free trade deal, if fully implemented, would lift about 30 million Africans out of extreme poverty and 68 million from moderate poverty by 2035.
In its latest report, the global lender noted that deal could boost income across the continent, solve poverty and cushion against the negative impact of coronavirus (COVID-19).
The African Continental Free Trade Area (AfCFTA) was scheduled to commence on July 1, 2020, but was actively delayed by the COVID-19 pandemic.
As a result of the virus, countries were forced to close their borders and this halted talks between governments over the removal of tariffs. As a result, the deal may become fully operational from the start of 2021.
According to the World Bank, the pandemic is expected to cost Africa up to $79 billion in lost economic output this year, with a rise in the unemployment rate.
This led to the bank’s decision that a successful implementation of the AfCFTA would be crucial as it is a major opportunity for Africa. However, implementation will be a major challenge as lowering tariffs is only the first step.
The trade deal has been touted to create an opportunity to connect 1.3 billion people across 55 countries with a combined gross domestic product of $3.4 trillion.
With good implementation, the Bretton Wood institution said it could also increase real income in Africa by 7 per cent or nearly $450 billion, mainly by reducing the cost of trade through the elimination of tariffs and red tape.
It noted that countries with the highest costs of trade such as Ivory Coast and Zimbabwe could see income gains of 14 per cent.
More so, the volume of total exports would increase by almost 29 per cent, with exports between African nations rising to 81 per cent while exports to non-African countries would increase by 19 per cent.
Based on the report, “implementing AfCFTA would lead to an almost 10 per cent increase in wages, with larger gains for unskilled workers and women.”
The AfCFTA was signed on May 30, 2019, for the 24 countries that had deposited their instruments of ratification. It is aimed at boosting intra-African trade by 52.3 per cent, eliminating import duties, and to double trade if non-tariff barriers are also reduced.
One of the main objectives of the AfCFTA is to create a single continental market for goods and services, with free movement of business persons and investments in Africa.
It also sought to expand intra-African trade through better harmonization and coordination of trade freedom while facilitating instruments across the Regional Economic Communities (RECs) and across Africa in general.
The AfCFTA is also expected to enhance competitiveness at the industry and enterprise level through exploitation of opportunities for scale production, continental market access and better reallocation of resources. Thus creating a free market and a unified continent.
By Aduragbemi Omiyale
A financing facility of up to $60 million has been secured by AXIAN Energy, the energy division of the AXIAN Group.
The funding package was provided by MCB, one of the leading financial institutions in the Indian Ocean region.
It comprises a $40 million revolving credit facility with a three-year tenor and extension option, and $20 million in unfunded instruments, providing AXIAN Energy with enhanced financial flexibility, enabling the company to rapidly mobilise resources and seize development opportunities across its target markets.
The energy firm is expected to use the capital to deliver large-scale energy infrastructure projects across Africa.
Over the past two years, AXIAN Energy has significantly accelerated its growth by expanding its renewable energy project pipeline, with solar projects currently under development in Senegal, Benin, Zambia, Côte d’Ivoire, Madagascar, and Burkina Faso.
Building on this momentum, AXIAN Energy now operates a portfolio comprising 350 MW of installed renewable energy capacity, supported by 77 MWh of energy storage capacity, positioning the AXIAN Group as a major contributor to Africa’s energy transition.
The chief executive of AXIAN Energy, Mr Benjamin Memmi, said, “This transaction marks a key milestone in AXIAN Energy’s growth trajectory. It provides us with the financial capacity to sustain the momentum we have built over the past two years, further strengthening our renewable energy portfolio and expanding our presence across new African markets.”
Also commenting, the Global Head of Structured Finance at MCB, Mr Mathieu Delteil, said, “We are proud to support AXIAN Energy in structuring this facility, reaffirming our commitment to enabling transformative projects across Africa.
“By leveraging our sector expertise and deep understanding of regional markets, we have delivered a tailored financing solution that aligns with AXIAN’s long-term renewable energy ambitions.
“This partnership highlights our role as a strategic financial partner, mobilising capital towards investments that drive sustainable growth and accelerate the energy transition across the continent.”
The financing agreement between the two organisations strengthens their long-standing relationship because it is driven by a shared commitment to supporting infrastructure development and economic growth across Africa.
By Adedapo Adesanya
Credit ratings agency, S&P Global Ratings, has restored the African Export-Import Bank (Afreximbank) to investment grade, nearly 12 years after its last assessment, citing the entity’s countercyclical lending record and strong shareholder support.
The BBB+ rating with a stable outlook is one notch above Moody’s Baa2 and comes months after Afreximbank severed ties with Fitch Ratings.
The lender accused the agency of misjudging its mission, following a downgrade to junk status amid disagreements over the bank’s role in debt restructurings for Ghana and Zambia. Fitch subsequently withdrew its ratings entirely and flagged governance concerns.
S&P said in a statement on Thursday that Afreximbank’s record as a countercyclical lender and its substantial shareholder support served as rationale for its rating. Credit ratings often guide the costs of capital for a borrower.
The lender’s total assets, S&P noted, had expanded to $42.3 billion by the end of 2025, up from $7.1 billion in 2015.
S&P said it did not incorporate preferred creditor status into its assessment because Afreximbank provides almost 80 per cent of its loans to private-sector entities.
However, it acknowledged that Afreximbank, alongside other institutions, had experienced prolonged payment arrears in recent years, notably following the defaults and debt restructurings in Ghana and Zambia.
S&P noted that Afreximbank said in December that it had come to an agreement with Ghana on its $750 million loan, but that the lender had not announced a resolution with Zambia.
The agency warned that further sovereign restructurings could weigh on Afreximbank’s asset quality.
S&P’s assessment described Afreximbank’s governance and management as “adequate”, saying the inclusion of two independent directors and the African Development Bank (AfDB) as a permanent board member provided institutional oversight.
It noted that while increasing participation of private-sector investors through Class D shares could influence the bank’s risk appetite, Class A shareholders retained veto rights over big institutional changes, balancing potential risk.
By Adedapo Adesanya
Mr Elon Musk, the world’s richest man, is now a trillionaire as his SpaceX rose 11 per cent in its Nasdaq debut on Friday, lifting its valuation to about $1.96 trillion as investors piled into the world’s largest initial public offering (IPO).
The stock opened for trading at $150 compared with the IPO price of $135 per share.
The landmark listing cemented Mr Musk’s status as the first trillionaire ever and propelled SpaceX into the ranks of the world’s most valuable companies
The listing is being used as a benchmark of what is to come for the market ahead of forthcoming IPOs for AI heavyweights Anthropic and OpenAI.
The record IPO is a culmination of Mr Musk’s long-held ambitions in space and technology.
Most of Musk’s wealth now rests with SpaceX, where he holds a stake worth roughly $866 billion. Along with Tesla and the rest of his properties, his net worth will exceed $1.1 trillion when the stock begins trading on Friday.
At a quoted $75 billion, the deal’s proceeds were more than double those of Saudi Aramco’s record-setting 2019 IPO.
The valuation could rise further should underwriters exercise their right to sell additional shares, a decision typically made within 30 days after the offering.
Although SpaceX may have to wait for entry into the S&P 500, its expected fast-track inclusion in the Nasdaq 100 will soon make it a major holding for passive funds and ETFs that track the index, creating a fresh source of demand for its shares.
It will take about a month before it gets added to that index under Nasdaq’s new fast-entry rules, as opposed to a typical wait of as much as a year.
SpaceX said its market opportunity spans $28.5 trillion, a figure it called the largest in human history.
Mr Musk, 54, was born in Pretoria, South Africa, to a Canadian mother and South African father. He attended the University of Pennsylvania, graduating in 1997.
He took over as Tesla’s CEO in 2008. Beyond Tesla and SpaceX, Mr Musk has co-founded five other companies, including tunnelling startup The Boring Company and brain implant maker Neuralink.
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