Dan Keeler, editor of Frontier Markets on Wall Street Journal, co-ordinates the Journal's coverage of the world's frontier markets. Launched in early 2014, WSJ's frontier market coverage brings together a broad range of news and analysis, providing readers with a deeper understanding of some of the world's most dynamic and fast-growing economies.

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Picture: ISTOCK
Picture: ISTOCK

The decision by Kenya’s Supreme Court to annul last month’s presidential election marks a new threshold for democracy in Africa and a new front in a battle of ideas over resurgent authoritarianism elsewhere on the continent. The judges’ ruling is the first of its kind in Africa and marks only the fourth time globally that courts have overturned presidential poll results after Austria, the Maldives and Ukraine.

Vindicated: Kenyan opposition leader Raila Odinga waves at supporters as he leaves the Supreme Court in Nairobi
Vindicated: Kenyan opposition leader Raila Odinga waves at supporters as he leaves the Supreme Court in Nairobi

Alex Vines, head of the Africa programme at UK think tank Chatham House, said the decision would galvanise institutions across Africa. “Its implications for the rule of law across the continent are massive: it will embolden courts far beyond Kenya’s borders,” he said.

The United Nations believes Burundi’s authorities may have committed crimes against humanity in the wake of May 2015’s failed coup attempt and asked the International Criminal Court to open an investigation as soon as possible. In a report published this week, the UN Commission of Inquiry on Burundi said it has reasonable grounds to believe crimes against humanity continue to take place. “We were struck by the scale and the brutality of the violations. We also noted a lack of will on the part of the Burundian authorities to fight against impunity and guarantee the independence of the judiciary. As a result, there is a strong likelihood that the perpetrators of these crimes will remain unpunished,” said Fatsah Ouguergouz, president of the UN commission.

International airline passenger arrivals to Africa are on the rise, according to a report from Forward Keys that shows arrivals so far this year are up 14% compared to the same period in 2016. North Africa contributed disproportionately to the rise in passenger arrivals, with Tunisia seeing a 33% rise and Egypt receiving 25% more travelers. Arrivals in Morocco increased by 21%. According to the report, Morocco and Tunisia’s visa exemptions for Chinese travellers helped drive up traffic significantly.

The US Treasury Department warned bank executives on Wednesday that South Sudanese political figures and rebels may try to use the US financial system to move or hide the proceeds of corruption. South Sudanese senior officials representing both sides of the conflict have used the situation to engage in corruption, the advisory said, citing a litany of alleged abuses, including hiding illicit enrichment through shell companies and misappropriating state assets devoted to natural resources, military procurement and military payroll.

The move comes just a week after US Agency for International Development administrator Mark Green met South Sudan’s President Salva Kiir in the country’s capital Juba. During that meeting, Green reminded Kiir that crisis is man-made and urged him to cease ongoing military offensives; end obstruction of humanitarian access, and to eliminate “exorbitant fees levied on aid organisations.”

Capital Economics slashed its 2017 growth forecast for Nigeria by almost half, cutting it from 2% to 1.2% after newly released figures showed the economy had expanded by just 0.6% in the second quarter. The firm also voiced concern over the fact that the growth rate of non-oil sectors had declined, despite reforms to the foreign exchange system that should be supporting it. CapEc also noted that oil-sector growth was weaker than anticipated but predicted that overall, the economy should expand by around 3% in 2018.

CapEc also flagged Egypt’s difficulty in hitting the targets agreed with the IMF as part of its $12 billion funding package. According to Jason Tuvey, the firm’s Middle East economist, the government’s fiscal deficit target is noticeably higher than that outlined by the IMF in January. Still, the country is making progress. “Egypt’s budget deficit has narrowed sharply over the past year and the high public-debt-to-GDP ratio should start to fall back soon,” Tuvey said.

Cambodian Prime Minister Hun Sen, the world’s longest-serving prime minister, announced this week that he plans to remain in office for another decade. The announcement came during a turbulent week in which the leader of the opposition, Kem Sokha, was arrested and charged with treason and the Cambodia Daily, one of the country’s last remaining independent newspapers, closed after tax authorities imposed a multi-million dollar tax bill on it.

The 65-year-old Hun Sen has been in power for 32 years but in recent years he has faced growing challenges from the opposition. Critics argue that his government has responded by trying to stifle the opposition. Sokha, who is 64, became leader of the opposition Cambodia National Rescue Party in February after his predecessor Sam Rainsy resigned and opted to live in exile to avoid imprisonment on a defamation conviction he says was politically motivated.

Beleaguered investors in Pakistan finally got some (kind of) good news this week. New York regulators had been expected to fine the country’s largest bank more than $600 million for failing to comply with state laws and regulations concerning money laundering, but instead fined it $225 million, Samuel Rubenfeld reports. Shares in the bank jumped 5% on the news, helping to drive a now-rare rise in Pakistan’s benchmark KSE 100 index.

Overall sentiment toward the South Asian nation, though, continued to decline. Standard Chartered’s senior economist Bilal Khan this week said the country’s fiscal and current-account deficits were widening more rapidly than expected, causing some concern for investors. “We have held a bearish view…over the past year. The latest available data, however, is even worse than our expectations,” Khan said.

Tajikistan on Thursday sold $500 million in 10-year bonds at a yield of 7.125%, Emese Bartha reports. Strong demand from investors enabled the country to price the bond more favorably than at the originally estimated 8%. Proceeds of the offering will be used to help finance the Rogun Hydropower Plant project.

Tajikistan’s success in issuing the bond is indicative of investors’ continued search for yield, Aleksej Gren, an analyst at London-based frontier markets investment bank Exotix, said. “Little known Tajikistan becomes one of the poorest countries to issue a eurobond [although it] has key-man risk and heavy dependence on Russia,” Gren said. He added, though, that the country has achieved average GDP growth of almost 7% over the past six years and has a relatively low debt-to-GDP ratio.

Argentina’s government coffers are filling as its economy gains traction, Taos Turner reports. According to Balanz Capital, a Buenos Aires-based research and investment firm, the uplift in revenues “should help [President Mauricio] Macri’s government to finally deliver some verifiable progress on the fiscal consolidation front.” Federal tax revenue was up 33.5% on the year in August, notably above inflation, while tax collection in the province of Buenos Aires surged 44.6%.

Russia said Venezuela has asked to restructure its debt, underscoring the Latin American country’s financial woes and its reliance on the Kremlin, James Marson and Anatoly Kurmanaev write. “There’s been a request from colleagues in Venezuela to carry out a restructuring,” Russian Finance Minister Anton Siluanov said on Friday, according to Russian news agencies. Russia is a key creditor and supporter of embattled Venezuelan President Nicolás Maduro through state loans and credits from Russian state-controlled oil giant PAO Rosneft to Venezuelan state oil company PdVSA.

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