Supporting Black-owned businesses to drive economic development


Supporting Black-owned businesses to drive economic development


Africa in the news: Somalia, Sudan, and Tanzania updates

Tanzanian President Samia Suluhu Hassan and Kenya's President Uhuru Kenyatta attand a joint statement at State House, in Nairobi, Kenya, May 4, 2021. REUTERS/Baz Ratner

Somalia restores relations with Kenya; ‘Farmajo’ reverses course on extending his term

On Saturday, Somali President Mohamed Abdullahi Mohamed announced he was reversing his recent controversial decision to extend his term by two years.  Previously, in response to the deadlock, Mohamed, popularly known as “Farmajo,” announced he would be extending his term. That announcement immediately was met with fighting in Mogadishu, which displaced anywhere between 60,000 and 100,000 people. In response, last week, the president convened regional leaders to discuss the contentious issue of the format of the coming elections, after which he announced he would not seek the extension.

In related news, on Thursday, Somalia announced it would be restoring diplomatic relations with Kenya. Late last year, Somalia had cut diplomatic ties with its neighbor, accusing Kenya of meddling in its internal affairs over monthslong tensions in Jubbaland as well as disputes over a maritime boundary.

Notably, both deals were brokered by Qatari leadership, who have emphasized that the situations remain fragile, but were hopeful that the various impasses could be resolved. Also this week, U.S. Secretary of State Antony Blinken announced that the U.S. Department of State would be sending the special envoy for the Horn of Africa, Ambassador Jeffrey Feltman, to Egypt, Eritrea, and Ethiopia to deescalate tensions through May 13.

Sudan clears arrears, a much-needed step to economic recovery for the country

On Wednesday, May 5, Sudan secured $425 million in loans to clear African Development Bank arrears. The $425 million bridge loan provided by Britain, Sweden, and Ireland has relieved existing debt for Sudan, allowing it to obtain new funding, including an immediate grant of $207 million. Moreover, the arrears clearance is Sudan’s latest step to clear at least $50 billion in debt.

Already the country has received financing to clear its arrears with the World Bank—including $1.15 billion in another bridge loan in early March from the United States. In response to this loan, the World Bank announced that it will begin a full reengagement with the country after nearly three decades.

In another important step toward forgiveness for Sudan’s estimated $49.8 billion in debt, the World Bank and International Monetary Fund met in late March to discuss Sudan’s eligibility for debt relief under the Enhanced Heavily Indebted Poor Countries (HIPC) Initiative. The decision by the IMF executive board that Sudan is eligible for HIPC means that the country would be able to secure more loans for recovery work.

These clearances come after years of international isolation and embargoes limiting access to development financing for Sudan and the recent lifting of sanctions. For example, in December of 2020, the U.S. removed sanctions against Sudan when it removed the country from the U.S. list of state sponsors of terrorism. Moreover, despite its many challenges, Sudan has taken steps to achieve the necessary reforms to put its economy and public finances on a sustainable path such as, according to the World Bank, brokering the promised peace deal to overcome internal conflict, holding free and fair elections, and further undertaking much-needed economic reforms to reverse decades of economic, social, and political distortions. These arrear clearances come at a meaningful time given that economic hardships have been exacerbated by COVID-19.

The Brookings Africa Growth Initiative has been following African debt sustainability and COVID-19 very closely. For more on this increasingly pressing issue, read “Debt sustainability and financing for development: A key post-COVID challenge,” “Africa needs debt relief to fight COVID-19,” and “COVID-19 and debt standstill for Africa: The G-20’s action is an important first step that must be complemented, scaled up, and broadened.

Tanzania addresses COVID-19 pandemic; Tanzania-Kenya gas pipeline signals warming relations

In a major reversal of COVID-19-related policies since the death of Tanzanian President John Magafuli—an outspoken denier of the coronavirus— in February, the country’s new president, Samia Suluhu Hassan, actively initiated measures to contain the virus and its variants. These measures include tightening international and domestic travel regulations to minimize the import of potent variants, including requiring negative COVID-19 tests at border checkpoints and imposing a mandatory 14-day quarantine for travelers returning or arriving from the origin countries of the coronavirus variants (e.g., the United Kingdom and South Africa).

Following Tanzania’s sharp reversal of its COVID-19 policies, the country has also “installed medical oxygen production plants in its biggest national hospitals.” The project, backed by the World Bank, enables Tanzania to produce 200 cylinders of oxygen a day. The ability to fill medical oxygen tanks is essential to serving intensive care patients and those suffering from severe COVID-19 symptoms.

In other Tanzania news, on May 4, Tanzania and Kenya signed a deal to build a gas pipeline between the coastal cities of Dar-es-Salaam, Tanzania and Mombasa, Kenya. Kenyan President Uhuru Kenyatta described the development of the gas pipeline as strengthening economic opportunity and lowering the cost of electricity in both countries. Kenyatta also iterated that the deal signals an improvement of relations between the two countries, which have historically suffered from border and trade disputes.