2018 Global Risk Forecast - Sub-Saharan Africa

Several countries in Sub-Saharan Africa are holding presidential or general elections in 2018, many of which will be key for the regional and global economies.

The Democratic Republic of the Congo (DRC), which was plunged into a political crisis since December 2016, when President Joseph Kabila failed to step down and hand over power, is due to hold its long-awaited presidential election in December 2018. In the meantime, the security situation is deteriorating in several parts of the country, displacing over 1.7 million people this year alone, who live in squalid conditions and face malnourishment and disease. This comes as the demand for cobalt  a metal used in many electronic products and electric vehicles, and of which over half the world's reserves are located in the south-eastern parts of the country is experiencing exponential growth worldwide. The worsening security environment will likely present increasing supply-chain and compliance risks for companies relying on the metal, including electric car manufacturers and technology firms. Also read: Trend Assessment: The DRC's multiple problems In Kenya, last year's disputed election results, whose validity opposition leader Raila Odinga continues to question, will continue to hamper the country's economic growth outlook amid debt rising to near-unsustainable levels. As the political crisis is likely to persist, this could affect the country's nascent oil extraction in north-western Turkana county, which could otherwise be a boon for President Uhuru Kenyatta's second term. Without a political settlement which includes the opposition, business-related and security risks will continue to grow throughout 2018.

As the political crisis [in Kenya] is likely to persist, this could affect the country's nascent oil extraction in north-western Turkana county

In Sierra Leone, three new contenders are competing for the presidency in March as incumbent President Ernest Bai Koroma is constitutionally barred from seeking another term. A run-off between the two main contenders is likely. In neighbouring Liberia, opposition leader George Weah of the CDC won a comfortable majority in the run-off against the ruling Unity Party candidate, Joseph Boakai. This was the first election to the highest office since the United Nations ended its mission in the country in June 2016, making it a litmus test for the country's continued peaceful transition. Weah's main challenges will be to create employment opportunities for the many young people who voted for him and root out corruption within the public sector. Also read: Liberia's general elections, a litmus test In Zimbabwe, hopes are plateauing ahead of general elections scheduled for September as the long-sitting president, Robert Mugabe, resigned under military pressure last November. The ruling Zanu-PF party is likely to remain a dominant political force, but will face growing competition from the opposition MDC-T party, led by Morgan Tsvangirai. Although Zimbabwe has entered a new era, the old guard is likely to maintain hold of the reins.

Although Zimbabwe has entered a new era, the old guard is likely to maintain hold of the reins

  By the same token, other African countries are also struggling with high debt levels, currency fluctuations and inflation. These include Ghana, Mozambique and Zambia. International financial institutions have lauded the Ghanaian government's policy of fiscal consolidation and budget discipline, but the country's over-reliance on oil revenue could hamper its optimistic growth forecast should oil prices dip again this year. In the other two, growing debt will continue to dog the respective governments ability to pay back loans to creditors, increasing political risk and reducing investment confidence. A deteriorating security environment is also likely to delay investments in Cameroon's English-speaking regions, where a secessionist insurgency awakened last year in response to the French-speaking administration's crackdown on anti-government protests there. Critical infrastructure development to increase connectivity with neighbouring Nigeria, much of which is due to pass through the Anglophone regions, is likely to be delayed. In Somalia, where perceptions of an improved security environment have attracted a growing number of foreign investors, in particular from Turkey and the Gulf, the progressive withdrawal of the Amisom peacekeeping force, which is due to begin next year, risks creating a security vacuum in which Islamist non-state armed group al-Shabaab will be able to recover. Also read: Trend Assessment: Cameroon's Anglophone problem