Africa

1. AGOA expires
2. Exiting the gray list
3. China’s new railway deal
4. Paga eyes US market
5. Upheaval in Madagascar
6. Kabila’s death sentence
7. AFC closes record loan

The Zimbabwean author honored for her short stories.

AGOA expires but may be renewed

The future of the US-Africa preferential trade pact was in limbo after the 25-year-old agreement expired on Tuesday — but hopes for its renewal persist.

The African Growth and Opportunity Act has allowed dozens of countries in sub-Saharan Africa duty-free access to the US market for certain products including fuel, agricultural goods, and textiles. In 2023, US imports under AGOA totaled nearly $10 billion. For many countries, such as Kenya and Lesotho, the deal has been a cornerstone of trade with the US, and envoys from across the continent have traveled to Washington in recent weeks to lobby for AGOA’s extension. The deal’s expiration has plunged thousands of factory workers into uncertainty at a time when African countries are already grappling with the impact of new US tariffs that imposed import taxes on many products which were previously duty-free under AGOA.

But there are some signs AGOA will be renewed, with a White House official telling Reuters the Trump administration supports a one-year extension of the pact. It is unclear when or how such a renewal would take place, with earlier reports suggesting an extension might be attached to a stopgap US government funding bill that failed to pass on Tuesday.

Top economies eye gray list exit

South Africa and Nigeria are set to be removed from a global financial watchdog’s “gray list” of countries under heightened scrutiny, Bloomberg reported, in a move that could attract investors to sub-Saharan Africa’s largest economies. The countries were added to the Financial Action Task Force’s list in February 2023 for failing to tackle money laundering.

The countries, along with Burkina Faso and Mozambique, could be removed from the gray list as soon as next month after FATF assessors noted significant progress, according to Bloomberg. The watchdog’s assessments are scrutinized by global investors: In a 2021 report, the IMF found gray-listed countries experienced “a large and statistically significant reduction in capital inflows.”

Nigeria and South Africa have in recent years implemented policies aimed at improving financial transparency to attract investment. Abuja published guidance on how the private sector should work with government agencies to tackle financial crimes, and Pretoria has strengthened legislation on the disclosure of beneficial ownership for companies and trusts.

China’s new mineral rail deal

Beijing struck a $1.4 billion railway upgrade deal with Tanzania and Zambia in a move to open up access to critical minerals. The agreement aims to refurbish the decades-old Tanzania-Zambia or TAZARA railway, a vital route for moving copper and cobalt from Zambian mines to the Tanzanian port of Dar es Salaam for export. The Chinese investment aims to modernize the 1,156-mile (1,860-kilometer) rail track, locomotives, passenger coaches, and wagons.

The move comes as the US backs the Lobito Corridor project, a rival railway upgrade in the southwest of the continent, which will refurbish train lines that connect Angola’s Atlantic coast to resource-rich DR Congo, as well as Zambia.  

Fintech Paga targets Africans in US

Nigerian fintech company Paga, which launched in the US in September, is betting that its decade-long operations in Africa’s payments ecosystem will give it an advantage in the race to provide financial services to the continent’s diaspora, its CEO told Semafor.

The Lagos-headquartered company launched its US operations in partnership with the Oklahoma-based Regent Bank, but Paga’s rollout is aimed primarily at the African diaspora with the Nigerian community as the initial adopters, Chief Executive Tayo Oviosu said.

The company plans to compete with US digital banks not only on essential money transfer and savings services, but by enabling transactions to Africa “in a way that [banks] just can’t,” owing to Paga’s access to local payment networks that its US competitors do not have, Oviosu said.

Madagascar dissolves its government

Madagascar’s President Andry Rajoelina dissolved his government after youth-led protests over water and power cuts in which at least 22 people were killed and dozens injured. Rajoelina said he would cast a wide net to find new ministers. “I heard the call, I felt the suffering, I understood the impact on daily life,” he said in a televised address on Monday.

Madagascar’s prime minister and cabinet ministers will operate on an interim basis until replacements are found. However, protesters are increasingly calling for Rajoelina to be removed from power: “The determination is palpable, and this mobilization seems far from over,” Madagascar daily Midi Madagasikara reported. Increasing rural poverty and a growing population have caused a surge in internal migration, increasing pressure on services, The Economist noted, saying it would take more than 70 years at recent growth rates for Madagascan living standards to catch up with those of Rwanda and Uganda.

Kabila’s death sentence

Former DR Congo President Joseph Kabila was sentenced to death in absentia by a military court for war crimes, treason, and crimes against humanity. His conviction could complicate Washington’s efforts to make peace between Kinshasa, M23 rebels in the east, and the rebels’ alleged backers in Rwanda, as the Trump administration seeks to invest in the resource-rich region’s mines and infrastructure projects.

Kabila — who was also convicted for his alleged support of M23 — was president from 2001 to 2019, but has largely been away from DR Congo since 2023 in self-imposed exile. He denounced the trial and prosecutor’s move for a death penalty as politically motivated, a stance that may also be adopted by his supporters.

Last week, Washington’s top Africa official told Semafor that a US-brokered peace deal has not been “fully” implemented. He was responding to skepticism about the deal, as fighting between M23 and Kinshasa’s forces is ongoing.

AFC marks record loan

The size of a loan raised by Africa Finance Corporation through a syndicate of commercial banks to invest in its general portfolio, marking its largest-ever facility. The Lagos-headquartered infrastructure bank mobilizes finance for major projects such as the Kamoa-Kakula Copper Complex in DR Congo. It lists China’s Bank of Communications, Kuwait’s Burgan Bank, Export Development Bank of Egypt, and Hua Nan Commercial Bank in Hong Kong among the firms that participated in raising the loan, which surpassed an initial goal of $1.3 billion. The AFC said more than $14 billion has been raised for projects that it has been part of since its founding in 2007, which have helped to create 7 million jobs.

Business & Macro