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Friday 21st of January 2022
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Last time NQ pierced the 50wma was the March 2020 crash. @coloradotravis World Of Finance |
29-NOV-2021 :: Regime Change https://j.mp/32AZEK5A REGIME CHANGE IS UNDERWAY [in the markets]
There is no training – classroom or otherwise.. that can prepare for trading the last third of a move, whether it's the end of a bull market or the end of a bear market.
There's typically no logic to it; irrationality reigns supreme, and no class can teach what to do during that brief, volatile reign. Paul Tudor-Jones
Love Fellini. So brave, with that whiff of insanity. @DiAmatoStyle Federico Fellini's 8 1/2 @tcm
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Strap on an ox-head Patricia Lockwood @LRB Misc. |
The Morning Star by Karl Ove Knausgaard, translated by Martin Aitken.
Animals live there, as do children, the mad, the dying, criminals, bad teenage drummers – you don’t get there by being good, but by being inside the beat.
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My Struggle: Book One | Karl Ove Knausgard Misc. |
In the midst of this spiritual storm spring arrived.
Few things are harder to visualize than that a cold, snow-bound landscape, so marrow chillingly quiet and lifeless, will, within mere months, be green and lush and warm, quivering with all manner of life, from birds warbling and flying through the trees to swarms of insects hanging in scattered clusters in the air. Nothing in the winter landscape presages the scent of sun-warmed heather and moss, trees bursting with sap and thawed lakes ready for spring and summer, nothing presages the feeling of freedom that can come over you when the only white that can be seen is the clouds gliding across the blue sky above the blue water of the rivers gently flowing down to the sea, the perfect, smooth, cool surface, broken now and then by rocks, rapids, and bathing bodies. It is not there, it does not exist, everything is white and still, and if the silence is broken it is by a cold wind or a lone crow caw-cawing. But it is coming . . . it is coming . . . One evening in March the snow turns to rain, and the piles of snow collapse. One morning in April there are buds on the trees, and there is a trace of green in the yellow grass. Daffodils appear, white and blue anemones too. Then the warm air stands like a pillar among the trees on the slopes. On sunny inclines buds have burst, here and there cherry trees are in blossom. If you are sixteen years old all of this makes an impression, all of this leaves its mark, for this is the first spring you know is spring, with all your senses you know this is spring, and it is the last, for all coming springs pale in comparison with your first. If, moreover, you are in love, well, then . . . then it is merely a question of holding on. Holding onto all the happiness, all the beauty, all the future that resides in everything
So strictly regulated and demarcated was life here that it could be understood both geometrically and biologically. It was hard to believe that this could be related to the teeming, wild, and chaotic conditions of other species, such as the excessive agglomerations of tadpoles or fish spawn or insect eggs where life seemed to swarm up from an inexhaustible well. But it was. Chaos and unpredictability represent both the conditions of life and its decline, one impossible without the other, and even though almost all our efforts are directed toward keeping decline at bay, it does not take more than one brief moment of resignation to be thrust into its light, and not, as now, in shadow. Chaos is a kind of gravity, and the rhythm you can sense in history, of the rise and fall of civilizations, is perhaps caused by this. It is remarkable that the extremes resemble each other, in one sense at any rate, for in both immense chaos and a strictly regulated, demarcated world the individual is nothing, life is everything. In the same way that the heart does not care which life it beats for, the city does not care who fulfills its various functions. When everyone who moves around the city today is dead, in a hundred and fifty years, say, the sound of people’s comings and goings, following the same old patterns, will still ring out. The only new thing will be the faces of those who perform these functions, although not that new because they will resemble us.
In recent years the feeling that the world was small and that I grasped everything in it had grown stronger and stronger in me, despite my common sense telling me that actually the reverse was true: the world was boundless and unfathomable, the number of events infinite, the present time an open door that stood flapping in the wind of history. But that is not how it felt. It felt as if the world were known, fully explored and charted, that it could no longer move in unpredicted directions, that nothing new or surprising could happen. I understood myself, I understood my surroundings, I understood society around me, and if any phenomenon should appear mysterious I knew how to deal with it.
Nietzsche was quoted as saying that “physics too is an interpretation of the world and an arrangement of the world, and not an explanation of the world,” and that “we have measured the value of the world with categories that refer to a purely fabricated world.” |
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My Struggle: Book One | Chapter 11 of 13 Karl Ove Knausgard Misc. |
a cloudless midsummer day, and the sun is burning down through the high, blue sky and sea. The water streaming off your body as you haul yourself up using hollows in the rock face, the drops left on your shoulder blades for a few seconds until the heat has burned them off, the water in your trunks still dripping long after you have wrapped a towel around yourself.
The scent they spread through the room as soon as they were peeled or cut open always reminded me of my father. That was how the rooms he had been in smelled: of cigarette smoke and oranges. Entering my own office and smelling the air there, I was always filled with good feelings.
Sometimes we joined him, and there is one special occasion that sticks in my memory, one night by Torungen lighthouse under the bluish-black August sky, when the gulls launched themselves at us as we were leaving the boat to make our way across the islet, and afterward, with two buckets full of crabs, we lit a fire in a hollow. The flames licked at the sky. The sea around us was immense. Dad’s face shone. |
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My Struggle: Book One | Chapter 12 of 13 Author: Karl Ove Knausgard Misc. |
An elderly woman with a shopping bag in one hand and a small white dog in the other looked at me as she came out of the door. I took a few steps closer to the wall and shook the contents into my hand. His ring, a necklace, a few coins, and a pin. That was all. In themselves, as everyday as objects can be. But the fact that he had been wearing them, that the ring was on his finger, the chain around his neck when he died, gave them a special aura. Death and gold. I turned them over in my hand, one by one, and they filled me with disquiet. I stood there and was frightened of death in the same way that I had been when I was a child. Not of dying myself but of the dead.
Even after all that had happened, there were still echoes of the smell I remembered from childhood. As a young boy I had already wondered at the phenomenon: how every house I had been in, all the neighbors’ and the family’s houses, had a specific smell all of their own which never changed. All except for ours. It didn’t have a specific smell. It didn’t smell of anything. Whenever Grandma and Grandad came they brought the smell of their house with them; I remembered one particular occasion when Grandma had surprised us with a visit, I knew nothing about it, and when I came home from school and detected the aroma in the hall I thought I was imagining things, because there was no other evidence to support it. No car in the drive, no clothes or shoes in the hall. Just the aroma. But it wasn’t my imagination: when I went upstairs Grandma was sitting in full regalia in the kitchen, she had caught the bus, she wanted to surprise us; so unlike her. It was odd that, twenty years later, after so much had changed, the smell in the house should be the same. It is conceivable that it was all to do with habit, using the same soaps, the same detergents, the same perfumes and aftershave lotions, cooking the same food in the same way, coming home from the same job and doing the same things in the afternoons and evenings. |
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These epidemics have proceeded in a similar fashion across states with initial rapid exponential growth that slowed as epidemics grew in size. @trvrb Misc. |
This would suggest 36-46% of the US infected by Omicron by mid-Feb. @trvrb
There may be a longer tail of circulation after the peak (as seen in South Africa), but a rough expectation would have an equivalent number of cases in the next 4 weeks on the other side of the peak. This would suggest 36-46% of the US infected by Omicron by mid-Feb.
Having ~40% of the population infected by a single pathogen in the span of 8 weeks is remarkable and I can't think of an obvious modern precedent. @trvrb
Having ~40% of the population infected by a single pathogen in the span of 8 weeks is remarkable and I can't think of an obvious modern precedent. Flu seasons generally have perhaps 10% infected in the span of 16 weeks. 8/9
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Guess who are the conspirators. @Rossana38510044 Misc. |
"They deliberated in secret. They used burner phones. They spoke only to their trusted colleagues. This went on for more than a month from late January 2020 to early March."
04-JAN-2021 :: Today only the Paid for Propagandists and Virologists will argue that there is a ''zoonotic'' origin for COVID19.
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It was the second wave that killed the dip buyers the most @sunchartist World Of Finance |
''Yeah you good traders can spot the highs and the lows pit pat piffy wing wong wang just like that and make a millino bucks sure no problem bro."
https://j.mp/3lEdphYGameKyuubi posted "I AM HODLING," a drunk, semi-coherent, typo-laden rant about his poor trading skills and determination to simply hold his bitcoin from that point on. "I type d that tyitle twice because I knew it was wrong the first time. Still wrong. w/e," he wrote in reference to the now-famous misspelling of "holding." "WHY AM I HOLDING? I'LL TELL YOU WHY," he continued. "It's because I'm a bad trader and I KNOW I'M A BAD TRADER. Yeah you good traders can spot the highs and the lows pit pat piffy wing wong wang just like that and make a millino bucks sure no problem bro." He concluded that the best course was to hold, since "You only sell in a bear market if you are a good day trader or an illusioned noob. The people inbetween hold. In a zero-sum game such as this, traders can only take your money if you sell." He then confessed he'd had some whiskey and briefly mused about the spelling of whisk(e)y. [HODL Definition | Investopedia]
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Surging Costs Deter EM Junk Sales With Just Four Deals in 2022 @markets Emerging Markets |
Sales of junk debt from emerging markets are in the deep freeze as a jump in yields deters companies and governments from pitching deals.
The new year has seen only four bond sales in euros and dollars from high-yield companies while no developing-nation government with a sub-investment grade at S&P Global Ratings or Moody’s Investors Service has so far tapped the market, according to data compiled by Bloomberg as of 5:00 p.m. in London.
They raised just $1.4 billion from the sale of debt, down 91% from the same period last year.
The drought stems from the rise in tensions between Russia and the Ukraine, and growing concern over debt levels in countries such as Ghana and Egypt, while U.S. Treasury yields also surge.
As investors fret over such trends, the risk premium for emerging-market junk debt has jumped well above the past five-year average.
“Countries wouldn’t want to issue at such levels,” said Richard Segal, a research analyst at London-based Ambrosia Capital.
“Investors would view such a market approach as desperation, which could cause a bigger selloff.”
With borrowers hesitant to pitch deals, high-yield investors also remain cautious while they nurse losses from last year, when newly-issued debt from emerging nations struggled amid tighter global liquidity and fund outflows.
A Bloomberg index of junk-rated EM debt has had its worst start to a year on record, driving up the average yield by 66 basis points to 7.9%, just shy of the highest level since July 2020.
“Levels and the state of the macro backdrop are not super conducive at this juncture for high-yield issuance,” said Rodica Glavan, head of EM corporate fixed income at Insight Investment Management in London.
“The reasons are technicals, little inflows, volatile macro and rates and nervy investors.”
Borrowing Frenzy
This year’s freeze is in contrast to the last two years, when companies and governments sold more than $250 billion.
The sale boom was fueled in part by a surge in demand for higher-yielding debt from emerging countries after the pandemic drove rates in the developed world to record lows.
Investment grade deals have fallen a more modest 16% to $29 billion this year. Even so, some of the deals that got done showed signs of the stresses facing the market as the year got underway.
EIG Pearl Holdings raised $2.5 billion, downsizing from the $3.5 billion to $4.4 billion it originally planned, while Coca Cola Icecek AS, an Istanbul-based Coca-Cola bottler unit, failed to nudge pricing lower from initial guidance on its $500 million of bonds sold last week.
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Sub Saharan Africa Africa |
In 1956, then-Soviet Premier Nikita Khrushchev executed a sharp but largely forgotten reorientation in his country’s foreign policy.
During the long decades under Josef Stalin, with the exception of its support for communist China, Moscow had focused almost all of its energy abroad in buttressing client states in Eastern Europe.
But with one major speech, Khrushchev announced that the era of investing only in Russia’s “near abroad” was finished.
Taking his cues from the 1955 Asian-African Bandung Conference in Indonesia that launched the Non-Aligned Movement,
and anticipating the huge wave of newly sovereign countries that would commence with Ghana’s independence from Britain in 1957,
the Soviet leader announced that the USSR was determined to assist newborn countries throughout what was then called the Third World in their pursuit of political and economic independence from the West.
It is one thing to give a speech and quite another to quickly steer the ship of state in a dramatically new direction, but the Khrushchev government wasted little time in turning its new policy into a reality.
Under his leadership, the so-called developing world quickly went from being an afterthought in Soviet foreign and economic policy to becoming a mainstay of its global strategy.
In fact, from 1950 to 1975, trade between Comecon, as the Soviet-led economic bloc was known, and the Third World increased seventeenfold.
Khrushchev offered modern agricultural equipment to his country’s new partners, as well as economic advice and management expertise.
Along with this, the Soviets proffered low-interest loans and barter arrangements that allowed poor countries to pay for goods with their primary products or by allowing Russians to run joint management companies that paid for the loans out of the companies’ operating profits.
Rather than having to beg their former colonizers for crumbs, these states could enjoy truly reciprocal advantages, or vzaimnaya vigoda, that only the Russians—as Moscow boasted—could offer them.
There is much about the takeoff of Soviet relations with the newly independent nations of the world—and especially with Africa, where the largest crop of such countries was located—that bears a resemblance to China’s expanding global engagement in recent years, starting with the near-hysteria that set in throughout the West about the geopolitical dividends that the Soviets would harvest from these advances.
Although it took the West far longer to sit up and pay attention to China’s recent advances than it did for them to notice the USSR’s breakthroughs at the height of the Cold War,
the world has recently witnessed some of the same sorts of alarmed responses from Europe and the United States to the rapid growth of China’s engagement with Africa during the past two decades.
It is also remarkable to note how similar, if not identical, some of China’s moves have been to those of the Soviet Union in a bygone era, down to Beijing’s frequent use of the phrase “win-win,” which is meant to emphasize the unique reciprocity it claims for its flourishing economic activity on the continent.
Just as remarkable, though, is what is missing in the Western response to China’s perceived advances, compared to how it reacted to those of the USSR decades ago.
Washington and Western Europe were deeply jolted by Khrushchev’s new policy.
Access to Africa’s resources at bargain-basement prices combined with a stranglehold on its consumers as a captive market had been key drivers of Europe’s postwar economic recovery.
Washington, meanwhile, although less obsessed with the economics of Africa than with the Cold War, suddenly worried that unless it found positive new ways to engage the continent,
Africa might turn “red,” or at least pink, tipping the balance in the raging East-West geopolitical competition in the favor of the former.
In the pages of Foreign Affairs in 1956, Henry Kissinger wrote of the Cold War having suddenly turned into a “contest for the allegiance of humanity.”
French politicians began pushing the idea of treating Europe and Africa as an economic condominium, which they went so far as to call Eurafrica, by which Africa’s newfound independence should be defined more by interdependence than true sovereignty.
Even in West Germany, a country that had not participated as deeply in the colonial exploitation of Africa as some of its European peers, the newspaper Die Welt asked in June 1960, “Is Africa getting away from Europe?”
Here, the echoes of today’s commonplace but false Western cries about China recolonizing Africa are hard to miss.
As remarkable as the similarities is what is missing in the West’s response to China’s perceived advances in Africa, compared to how it reacted to Russia’s decades ago.
In the United States, the perceived Soviet advance drove a raft of new policy initiatives focused on Africa and the Third World more broadly.
What is most remembered from this era is the creation of the Peace Corps, but in fact, the Kennedy administration strongly boosted economic assistance to Africa, and pushed Europe and Japan to do the same, albeit with mixed success.
“No economic subject more quickly captures the attention of so many as the rescue of the people of the poor countries from their poverty,” wrote the economist John Kenneth Galbraith in his 1979 book, “The Nature of Mass Poverty.”
This, alas, would all peter out. In the 1970s, the United States and Western Europe swapped places in terms of their attitudes toward Africa, with Washington downsizing its short-lived economic engagement, while Europe experienced a revival of interest in the continent.
Nowhere in the West, however, was economic policy toward Africa any longer a matter of serious urgency.
Although the Soviet push to engage the less developed countries of the world economically continued well into the 1970s, already by the early to mid-1960s, serious signs of difficulty were apparent.
For one thing, the Comecon bloc possessed nothing like the wealth of the West, and therefore always had trouble mustering the means to pursue its ends.
Second, the Russians, having never been an imperial power outside of the Eurasian continent, lacked the Europeans’ long-standing connections, soft power influence and historical and social familiarity with many parts of the world that Moscow was suddenly engaging with.
Nowhere was this truer than in Africa. As Sara Lorenzini writes in her recent book, “Global Development,” according to a report written for the Soviet Central Committee in 1959, the USSR had 48 specialists abroad at that time, “none with any knowledge of the local language.”
By comparison, London had 1,143, Washington 924 and Paris 683.
For these reasons and others, the learning curve for the Soviet Union in the Third World was extremely steep, and it wasn’t long before the bloom faded from the rose for many of its once-exuberant newfound partners.
Complaining about the slow fulfillment of projects as well as the quality of certain goods and services, Guinea, a newly independent former French colony that had broken with Paris, expelled a Soviet ambassador in 1961.
An even bigger reason the Soviet Union’s push into Africa and its broader efforts to engage with the developing world slowed dramatically, though, was that few of these countries wanted to be forced to choose between foreign partners.
As then-Tanzanian President Julius Nyerere said in 1965, in response to Western pressure to keep communist countries—in this case, China—at arm’s length, “We will not allow our friends to choose our enemies.”
In this era, countries in Africa, Asia and Latin America jealously guarded their own independence and were quite eclectic about accepting financing or other economic assistance from whichever prospective partners offered it, so long as it seemed to fit their needs.
Having drawn a parallel between the Soviet Union of more than half a century ago with the China of today, what does this all tell us?
First of all, China won’t be replacing anybody in Africa or anywhere else in the so-called Third World.
Beijing, too, has faced a stiff learning curve and will make many mistakes along the way.
Right now, it is in the midst of a major adjustment of its economic engagement with Africa, for instance, scaling back on the easy money approach it had followed in terms of lending to many countries a decade or two ago, and focusing more soberly on longer-term viability and surer bets about economic returns.
Second and even more importantly, governments in Africa, as in the rest of the Third World, want viable foreign partners who are willing to invest in helping create better infrastructure, both physical and human.
In another era, the West briefly responded to the challenge it perceived from the Soviet Union both with its imagination and by reaching into its pockets.
Each are utterly lacking today in its response to China’s active engagement with Africa and elsewhere. Instead, all one hears is jeering from the sidelines.
Finally, there can be only one true criterion of success among Africa’s foreign partners, and that is their long-term impact on measurable economic development, and especially on reducing poverty. And so far, the jury is out on all of them.
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Soviet Premier Nikita Khrushchev and Ghanaian President Kwame Nkrumah of Ghana in front of the Soviet U.N. delegation headquarters, New York City, Sept. 22, 1960 (AP photo). Africa |
28 OCT 19 :: From Russia with Love
“Our African agenda is positive and future-oriented. We do not ally with someone against someone else, and we strongly oppose any geopolitical games involving Africa.”
“Russia regards Africa as an important and active participant in the emerging polycentric archi- tecture of the world order and an ally in protecting international law against attempts to undermine it,” said Russian deputy foreign minister Mikhail Bogdanov back in November 2018.
Andrew Korybko writes Moscow invaluably fills the much-needed niche of providing its partners there with “Democratic Security”, or in other words, the cost-effective and low-commitment capabilities needed to thwart colour revolutions and resolve unconventional Wars (collectively referred to as Hybrid War).
To simplify, Russia’s “political technologists” have reportedly devised bespoke solutions for confronting incipient and ongoing color revolutions, just like its private military contractors (PMCs) have supposedly done the same when it comes to ending insurgencies.
19 APR 20 :: The End of Vanity China Africa
To quote a Chinese saying, "The ocean is vast because it rejects no rivers."
Interestingly, At that 2018 FOCAC Meeting Xi Jinping also delivered a thinly veiled warning
China's Xi says funds for Africa not for 'vanity projects' Reuters #FOCAC2018
Our African Leaders did not take notes and that Warning was missed.
“Let the people of the country see what the terms of the debt are as their government makes commitments,” Malpass said.
The Terms of these debts are hidden precisely because they are so egregious.
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Ethiopia needs more than peace talks Responsible Statecraft Alex de Waal Africa |
Washington’s new special envoy for the Horn of Africa, David Satterfield, and Assistant Secretary of State for Africa Molly Phee, are heading for Ethiopia this week.
They are doubtless buoyed by some rare good news from the country: Prime Minister Abiy Ahmed has released some political prisoners, toned down bellicose rhetoric against the Tigrayans who are fighting fiercely in the country’s 14-month-old civil war, and spoken with President Joe Biden for the first time.
Abiy also gave a green light to the African Union’s high representative, former Nigerian president Olusegun Obasanjo, to meet with the leaders of the Tigray People’s Liberation Front.
The shifts are real. The center of political controversy in Addis Ababa is no longer the Tigray war but the question of whether Abiy will be able to corral enough of the Oromos — the country’s largest ethnic group — into his planned “‘national dialogue.”
The position of Jawar Mohamed, a leader of the Oromo democratic movement and committed federalist, now at liberty after 18 months in prison, will be crucial.
Abiy is now wooing the splintered but still vigorous Oromos, speaking positively about the federal constitution, and distributing promotions to army officers — many Oromos — like confetti.
In doing so, he also surprised and antagonized the unionist constituency, mostly Amhara ethno-nationalists, who had been the most hardline supporters of the war on Tigray, some of them indulging in blatantly genocidal rhetoric.
Planned festivities in Addis Ababa and Amhara region cities to celebrate “victory” were abruptly called off.
Abiy’s maneuvers caught many Ethiopians off guard and won him some room for maneuver.
Western diplomats are hopeful that peace negotiations with the TPLF may now be in prospect; Kenyan President Uhuru Kenyatta has been active behind the scenes.
In his talk with Abiy, Biden stressed the need for humanitarian access to the starving in Tigray, halting human rights abuses, and the need for peace.
Nonetheless, the war rages on. Following the Tigrayans’ withdrawal of their forces from neighboring regions last month — under pressure from the United States as well as onslaught by newly-acquired swarms of drones — fierce fighting has continued.
The Ethiopian army stalled its ground offensive into Tigray, but air strikes continue on a daily basis, killing scores of civilians.
Abiy and Eritrean President Isaias Afwerki have not relaxed their starvation siege on five million people.
The most recent United Nations food assessment for Tigray was in June last year, and it forecast widespread famine within three months if aid were not delivered at scale.
Abiy has permitted only 12 percent of needed aid to go in. For six months, the official figure for the starving has remained unchanged at 400,000 — a number that is no more than a desperately optimistic guess given the dreadful logic of famine.
Last week, the World Food Program reported that its warehouses in Tigray were empty, while Tigrayan doctors detailed the near-total collapse of health services.
Not even insulin for diabetic patients is allowed on the UN’s sole weekly supply flight. Ending the famine was top of Biden’s talking points when he spoke with Abiy on January 10.
For Abiy’s close ally Afwerki, political dialogue, prisoner releases or federalism are anathema, and he made clear his contempt for Abiy in a rare television interview earlier this month.
Isaias remains determined to crush Tigray. His troops are still fighting inside Tigray, and his agents are all over Ethiopia, sowing discord and running illicit businesses.
These issues make for a full agenda for Satterfield, Phee and Obasanjo. But it’s important that they don’t mistake short-term maneuvers for a fundamental and essential political reorientation.
Abiy is like a skilled seaman who can keep his ship afloat, but he’s not a navigator who can steer it to a destination.
What explains Abiy’s latest maneuver is that he has run out of money. Alongside the disintegration of the unified national army and the fever pitch of ethnic mobilization, bankruptcy portends protracted state crisis, perhaps collapse.
When Abiy took office four years ago, Ethiopia’s economy, following an East Asian “developmental state” model, had been growing at nine percent annually for a decade.
Now it’s a basket case: growth in 2021 may be just two percent, and the uncertainties are such that the IMF hasn’t made any forecast for 2022.
Having overspent massively on the 2021/22 budget (the fiscal year runs from July), the government presented a supplementary budget to parliament in December.
Grants and loans have dried up; its credit rating is rated “junk;” and the country is considered “uninvestable” by the private sector.
Despite desperate lobbying, Ethiopia lost its beneficiary status under the U.S. African Growth and Opportunity Act on January 1 due to its gross human rights record.
Abiy boasted that he could always turn to other allies, including China, Russia, and Middle Eastern countries.
But while they may offer him cash in hand and discounts on weapons sales, none will bail out a failing economy in a nation of 115 million people. Only the Atlantic powers and the Bretton Woods institutions can do that.
Ethiopia needs a rescue package to stave off galloping inflation, restructure its debts and keep the lights on. The donors won’t step up while it spends all its resources on the war.
Most urgently, Ethiopia is facing a nationwide food crisis. According to the USAID-funded Famine Early Warning System Network, “expanding conflict and prolonged drought [are] expected to drive record-level and extreme need in 2022.”
Alarms don’t come more explicit than this.
The FEWSNET map shows emergency and crisis food insecurity across half of the country.
Faced with a crippling harvest shortfall six years ago, the government mobilized a rapid and effective response.
It wasn’t just a humanitarian effort — government leaders feared that a 50 percent hike in the price of food would lead to unrest and endanger the regime.
Food price inflation recently hit 40 percent.
It’s Western nations, especially the United States, that fill Ethiopia’s emergency food basket. They insist that the government feed the starving in Tigray as well as the hungry in the rest of the country.
Abiy’s political challenge is encapsulated in the name of the Prosperity Party he leads. It’s both a nod to his Pentecostalist faith and a promise of material rewards to his followers.
When he took office in 2018, Abiy entranced Ethiopians by telling them that everyone could have everything, once the magic of the free market worked its wonders and the corruption of the previous regime was rooted out.
But his real sorcery was a one-time fire sale of state assets. He doled out prime real estate in return for political favors and began selling off the crown jewels of the developmental state, notably the government-owned telecoms.
In fact, the war on Tigray was not only a power struggle but a huge grab of land and assets.
The internment of Tigrayans in Addis Ababa en masse late last year amounted to a massive shakedown, as their businesses have been confiscated and they are extorted to pay bribes to make phone calls, get medicine or — if they can afford it — buy their release.
Eritrea grabbed its share of the spoils by pillage. It also snapped up Tigrayan companies and runs illicit foreign currency exchange schemes.
To recapture the hard currency from remittances — Ethiopia’s most reliable source of dollars — the Central Bank of Ethiopia is contemplating a new parallel exchange rate.
Unconcerned with the stability of the Ethiopian currency, Eritrea will be a ruthless rival in that market.
Abiy is adept at managing the urban elite through the autocrat’s classic playbook of coercion and patronage.
In the provinces, his coercive options are limited because security is in the hands of regional ethnic forces whose loyalty isn’t to him.
And Abiy has probably left it too late for financial stabilization.
The region’s merciless political operators are circling around a wounded and weakened leader, expecting him to stoke political disorder because he thinks he can zigzag more smartly than his rivals.
That may be correct, but that way lies protracted instability — saving a government by sacrificing a functioning state.
The transactional politics practiced by Abiy and his backers is possible only with a solid macroeconomic foundation.
The Ethiopian state is failing because that foundation is crumbling, and the help needed can only come from America, Europe, and the international financial institutions they still control. Washington has strong cards to play, if it wishes to play them.
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Gateway to growth: How the European Green Deal can strengthen Africa’s and Europe’s economies @ecfr @michaeltanchum Africa |
Summary
In much of Africa, growth is being driven by “green energy innovation ecosystems”, which combine telecoms, digital platforms, solar power, and the internet of things.
European companies and states risk losing out on business opportunities and political influence if they fail to integrate their services and infrastructure into these emerging ecosystems.
China and other economic and geopolitical rivals will become African states’ main partner if Europeans stand aside from this key growth trajectory.
The EU can: assist on offering world-class data regulation and supporting the construction of data centres; support the construction of other infrastructure, such as for 5G; and help roll out off-grid solar power generation and electric vehicle manufacturing.
Europeans should work in joint ventures with African firms as this model is proven to create value added that China’s investments often fail to produce.
The EU should merge its nascent Global Gateway international connectivity programme with the European Green Deal.
The objectives of both require similar levels of investment in African infrastructure and they can unlock the investment potential of European public-private partnerships.
By 2025, Africa will have over 100 cities with more than one million inhabitants – more than three times the number in the European Union.
By 2030, 42 per cent of the world’s young people will live in Africa, making the continent home to the largest supply of affordable labour on the planet in the coming decades.
green energy innovation ecosystems that are emerging in sub-Saharan Africa; they are already defining the future trajectory of economic growth on the continent.
These innovation ecosystems thrive by combining cutting-edge digital technologies and telecommunications with renewable energy technologies.
Solar energy, electric vehicles, and telecommunications and information and communications technology (ICT) are all intimately interconnected.
They synergise with one another to create a virtuous cycle of market expansion for each sector.
Indeed, in the last decade, China overtook the EU to become Africa’s top trading partner, and India became the continent’s second-largest such partner.
Turkey’s rate of growth in African trade surpassed the EU’s by a factor of five, while the Gulf Arab states similarly expanded their trade and investment relationships with Africa.
Chinese investments across the continent have not brought about a China-style economic boom in any African country.
The EU urgently needs to combine the foreign policy aspect of its European Green Deal with its nascent Global Gateway programme, which is its answer to China’s Belt and Road Initiative (BRI).
The commercial imperative to maintain a low cost base while nearshoring has led to the establishment of new production facilities in Africa.
By establishing steel and textile manufacturing in Algeria, Turkey has become that country’s largest foreign employer, undercutting the political influence of France and Italy.
Turkey and its close partner, Qatar – which also opened a steel plant in Algeria – now dominate the country’s steel industry. Within the same time frame,
Turkey opened Africa’s largest textile production plant – also in Algeria. And, following this success,
Turkey has established a steel plant and a furniture factory in Senegal, to serve the rapidly growing consumer markets there and in other parts of west Africa.
Sub-Saharan Africa’s green energy innovation ecosystems
in 2019, mobile technologies and services in sub-Saharan Africa generated $155 billion of economic value added, or 9 per cent of the region’s GDP.
The sector is projected to grow by 18.7 per cent by 2024, to $184 billion.
For example, the rise in mobile banking in Africa using cellular networks is creating market demand for solar power adoption and electric vehicle use.
As African countries roll out higher capacity cellular networks such as 4G and 5G – in partnership with European, Chinese, or other firms – their infrastructure requires more power generation
In 2020 approximately 600 million people in sub-Saharan Africa – 48 per cent of the entire continent’s population – had no access to electricity.
Yet the International Energy Agency (IEA) has projected that, by 2030, renewable energy sources will power over 60 per cent of the region’s “new electricity access” (a term referring to electricity for people who previously did not have electricity available to them).
Almost half of this new supply will be provided by off-grid photovoltaic (PV) solarsystems (and by mini-grid PV systems, which are local and small-scale).
In turn, the IEA states that the further adoption of off-grid and mini-grid systems will be facilitated by the use of “new business models using digital and mobile technologies”, such as those noted above, as people use apps to acquire and manage such systems.
Africa’s innovation ecosystems increasingly rely on the internet of things.
ICT
In 2019 there were 447 million unique mobile device subscribers in sub-Saharan Africa – 45 per cent of people in the region.
While the typical maximum power consumption of a 3G site is 4,808W, this goes up to 6,877W for 4G and 11,577W for 5G.
Accordingly, upgrading 3G coverage in sub-Saharan Africa to 4G would lead to an additional 43 per cent in power consumption at such sites.
The upgrade from 4G to 5G would involve a further 68 per cent rise in power consumption.
A 2019 International Monetary Fund report projected that establishing full 4G connectivity in sub-Saharan Africa by 2025 would require $14 billion in capital and operational costs – the latter including energy consumption.
The report also estimated that, assuming the whole of Africa has full-scale 4G by 2025, it would cost $57 billion to upgrade this to 5G by 2040.
5G broadband cellular networks offer data speeds up to 100 times faster than 4G and can support up to 1m connected devices per square kilometre, compared to 100,000 for 4G. This makes the technology the gatekeeper of the internet of things
Gateway to growth: How the European Green Deal can strengthen Africa’s and Europe’s economies @ecfr @michaeltanchum [continued]
Mobile banking and solar power
Data centres
Around half of mobile money accounts worldwide belong to consumers based in sub-Saharan Africa.
And the region is on track to see the fastest growth in mobile money anywhere in the world through to 2025.
An estimated 700 new data centres are needed to meet the continent’s growing demand for data storage and thereby support other digital activity.
This will likely require 1,000MW of additional installed power generation capacity.
Electric vehicles
As the lion economies of Africa began to roar in the mid-2010s, global automakers began turning their attention towards sub-Saharan Africa.
This led Bloomberg News in 2015 to describe sub-Saharan Africa as the “last frontier for car makers on the hunt for growth.”
Since then, there has emerged an even firmer global industry consensus on the prospects of the region’s car market.
“The question on Africa isn’t, ‘is it a market of the future?’” – Nissan's managing director for Africa operations explained in a 2019 interview – “it’s a case of when.”
In most African countries, the import of new and used cars is the second-highest contributor to their current account deficits, surpassed only by the cost of petroleum and petroleum products
Moreover, urban regions of Africa are facing an environmental and health catastrophe due to the prevalence of highly polluting, end-of-life internal combustion engine vehicles.
These substandard used cars – 80 per cent of which are unable even to pass the less stringent 2005 Euro 4 emissions standard – spew a tremendous amount of toxic carbon emissions into the air of Africa’s major cities, a problem worsened by their extremely low fuel efficiency.
Volkswagen’s Africa division estimates the potential new car market in sub-Saharan Africa to be 3-4m vehicle sales a year.
The new car market in the region could reach or exceed sales of 15m vehicles a year by 2035, especially if companies make affordable models locally.
A former chair of Volkswagen’s Africa division, Thomas Schäfer, confirmed that the company wants to develop a pan-African end market.
He explained the company’s larger vision for this: “the big game will be to connect … Kenya, Rwanda, Nigeria, South Africa and create an African market. Because then you [are] talking a billion people, and then you can walk away from exporting to America; exporting to Germany ... What’s the point? You’ve got the market right here.”
In terms of introducing electric vehicles into that end market, the company considers its e-Golf pilot “a blueprint for electric mobility in Africa”.
For example, with the help of the China Hi-Tech Group Corporation, a leading special-purpose vehicle-maker, Uganda’s government created the state-owned Kiira Motors Corporation (KMC) to produce buses for mass transit.
KMC will soon go into full production of a fully electric, 90-passenger mass transit bus intended to reduce pollution across the country.
Elsewhere, South Korean automaker Hyundai has assumed pole position in the race for electric vehicle production in sub-Saharan Africa by creating electric vehicle assembly lines in the region’s two most populous countries, Nigeria and Ethiopia.
In 2019 Hyundai opened an assembly plant with the capacity to produce 10,000 cars annually in the Ethiopian capital, Addis Ababa.
Kenya
Africa’s PAYG pioneer, Kenya, has significant potential to leapfrog to electric vehicles.
In the first half of 2021, new car sales in Kenya increased by 35 per cent. Kenya’s transport sector accounts for 39 per cent of the country’s CO2 emissions.
European Green Deal to the Global Gateway and Build Back Better World (B3W).
At the heart of this more outward-facing stance is the European Green Deal, which aims to mobilise a total of €1 trillion to decarbonise the European economy and facilitate similar transitions abroad.
The BRI is reshaping the architecture of global trade and commerce. As well as building new infrastructure through the BRI, Beijing is using it to strengthen political ties with governments.
In response, in December 2021, the European Commission launched a global connectivity strategy called the Global Gateway.
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