Kenya protests cast sparks into the rest of anglophone africa
When we last visited Kenya, the embattled government of the present incumbent, William Ruto, was pulling at straws in an effort to placate a surging protest movement calling for his resignation. Today, over two weeks on, the protestors and the state still appear to be nowhere near any kind of resolution. Ruto’s government has since tried to put forth various compromises, from scrapping the tax hike proposals which had originally ignited the protests to the dismissal of most cabinet ministers to a proposed coalition government deal with the Azimio opposition party. None of these have sufficed for the protestors however, who remain critical of the government's heavy handed crackdown and insist that Ruto must resign. The ruling incumbent has in turn responded by similarly digging in his heels, publically claiming that criminal elements and American NGOs are behind the unrest and by some accounts sponsoring pro government thugs to fight the protestors in the streets.
While sparks fly in Kenya it appears to be the rest of anglophone Africa that now threatens to catch fire. In both neighbouring Uganda and Nigeria much further afield, copycat protest movements are forming, inspired by Kenya’s example and keen to vent frustrations around a similarly crushing cost of living crisis among other political issues. Local governments have responded in mixed ways. In Nigeria, where the Tinubu-led government faces a litany of crises both domestic and regional, the leadership has opted for the carrot over stick approach, with minimum wage increases, announcements of grant disbursements and more employment offers at the state oil company. In Uganda meanwhile where the security forces have helped keep President Yuweri Museveni in power since 1986, the state has responded with a more heavy handed approach , arresting over 104 protestors to date.
Both governments would have much to fear from unrest getting out hand. In Uganda a dark cloud still hangs over the public consciousness following the so called “black november” incident in 2020, when protests demanding the release of opposition candidate Robert Kyagulanyi (Aka Bobi Wine) provoked a government crackdown that killed over 50 people. In Nigeria meanwhile the government is similarly haunted by the spectre of the hunger riots which struck the country in February of this year, brought on by record inflation and the removal of government subsidies and which provoked large scale rioting and looting.
Like many economies across Africa, both Uganda & Nigeria were struck a hard blow by the one-two punch of the covid & Ukraine war period, which have served to dramatically inflate both government debt and the cost of basic necessities for ordinary people. As governments face the unenviable task of choosing between their electorates and their creditors, they will likely have to lean heavily on their state security apparatuses to make up the difference. However, what the viral popularity of the Kenyan protests shows is that much has changed since the 20th century when corrupt & sclerotic regimes on the continent could survive from mere repression alone. In a modern Africa that is increasingly connected, informed and possessed of a strong political consciousness. it will increasingly be the people who have the final say.
Disappointing Anglo American interim results highlight the extent of South African logistics crisis.
The last year has been quite tough for southern african mining giant Anglo American. After cyclical downturns for platinum, diamonds & other products ate into its share price at the start of 2024, the company narrowly survived a takeover attempt by BHP in the second quarter, largely due to shareholders being concerned that BHP lacked the wherewithal to handle the complexities of streamlining & unbundling some of Anglo’s world famous, though unprofitable southern African operations, including The De Beers diamond operations in Botswana & Amplats platinum operations in South Africa. In exchange for this act of loyalty, Anglo’s management promised shareholders that they would work to radically restructure , jettisoning the aforementioned operations for a keener focus on more profitable assets like their South American copper mines and UK based crop fertilizer operation. All that would be required of Anglo was that they make their soon to be spun-off assets enticing enough for a large scale investors to bite.
It is precisely here that the wheels have come off for Anglo in the intervening months. This was made apparent on the week of July 22nd-25th, When Anglo and its key subsidiaries, including Amplats, De Beers & Kumba Iron Ore published a slew of disappointing interim results despite extensive cost cutting measures & large scale retrenchments.Executives have been quick to blame external factors like slouching Chinese demand but the fact remains that Anglo is no closer to rendering its African operations marketable than it was at the start of the unbundling process. Worse still however is the report from Kumba Iron ore, which specifically highlights the detrimental impact of South Africa's logistics crisis on the miners operations and will likely stand out as a red flag to any other potential investors.
When one reads up on 21st century supply chains, a key concept one will repeatedly encounter is “multi-modal” logistics. That is to say a system whereby different forms of transportation- road, rail, air freight and marine shipping, all work in close unison to render the transport of goods as efficient as possible. South Africa is perhaps the only economy on earth where this development has happened in reverse, with the recent collapse of the freight rail system increasingly pushing the economy to a “mono-modal” setup where road freight increasingly predominates.. This is largely due to years of corruption & maladministration at the local state railway provider, Transnet Freight Rail, which continues to hold a sole monopoly on local rail traffic despite desperate calls for privatization from the likes of Kumba & other big players in the natural resource & agriculture industries who have been depending on efficient rail transport for exports since their inception.
Those operators who can afford it have had to shift over to freight trucking, which is much more expensive and also has various negative externalities like a damaging effect on the overburdened local road network and an extra congestive effect on local port operations, which have also deteriorated in quality in recent years. The cumulative effect of these challenges is that local operators now avoid SA logistics routes when they can, increasingly opting for alternative rones like through the Mozambican port of Maputo or Namibia's Walvis Bay. When Botswana recently decided to embark on coal mining scheme, it rejected SA ports as possible export route out of hand, preferring to partner with Zimbabwe & Mozambique instead.
There is still some hope for improvement however, SA’s government has over the last year or more shown a surprising willingness to privatise various port terminals for example, though it has thusfar stopped short of promising a full privatisation of the rail network, instead maintaining it would bring private stakeholders onboard as “partners”. Should it have the courage to upgrade these actors to full owners of portions of the rail network, SA might still avert the slow decline afflicting many of it otherwise outperforming export industries. , if not, we can expect many more Kumba’s yet to come.
