South Africa Economy Shrinks
South Africa’s gross domestic product (GDP) decreased for the first time since the 2009 global recession, shrinking in the first quarter of this year by 0.6 percent. This follows a nearly four percent growth rate from the previous quarter. Following the release, the rand fell almost one percent against the dollar.
The contraction in GDP was largely attributed to the ongoing five-month platinum mining strike, while a greater than 25 percent unemployment rate and rising inflation have raised fears that the economy may be heading into a recession. The weaker growth also caused the South African Reserve Bank to hold interest rates, which had previously been increased to control for inflation.
This news came as Nhlanhla Nene became the first black South African Finance Minister earlier this week. He will face the challenge of bringing down the budget deficit while improving the economy and finding a resolution to the mining strike.
Ethiopia May Delay Joining World Trade Organization
On Wednesday, Ethiopia’s Minister of Trade Kebede Chane stated that Ethiopia may delay joining the World Trade Organization in 2015 if the country is required to liberalize its tightly regulated telecoms and banking industries. Ethiopia is one of sub-Saharan Africa’s fastest growing economies and its fifth largest. While other African markets have liberalized, Ethiopia has sheltered its growing private sector from foreign competition.
Although newer WTO rules from 2012 lowered the membership requirements for the world’s least developed nations, Kebede felt that more economic development was needed.
Mali’s Defense Minister Resigns
Mali’s Defense Minister Soumeylou Boybeye Maiga resigned on Tuesday after a heavy defeat of army forces by the Mouvement National pour la Libération de l’Azawad, made up of Tuareg separatist forces. He was immediately replaced by retired airforce colonel Ba N’Dao. The failed attempt to retake Kidal and several northern towns has led to a violent displacement of 4,000 people and the death of 50 soldiers. Tuareg rebels agreed to a ceasefire last Friday after launching an assault and seizing Kidal early last week. This agreement commits the parties to start negotiations to facilitate humanitarian access, free prisoners and create an international commission of inquiry.