The Economist - USA (2020-11-07)

The EconomistNovember 7th 2020 Middle East & Africa 43

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1

T

ourists may not have returned to

Egypt’sbeachesandhistoricsites,but

theportfolioinvestorsareback.SinceMay

foreigners have snapped up more than

$10bninlocal-currencydebt,reversinga

sell-offfromtheearlydaysofthecovid-19

pandemic. There is similar enthusiasm

acrosstheregion.Thesixmembersofthe

GulfCo-operationCouncilissueda record

$100bninpublicandcorporatedebtinthe

firsttenmonthsoftheyear.Treasuriesare

courtinglocalinvestorstoo,thoughnotal-

wayssuccessfully:Tunisia’s government

wasrebuffed when itasked thecentral

banktobuytreasurybonds.

Arabstatesareonaborrowingbinge.

Even before covid-19 arrived many were

taking on fresh debt to cope with low oil

prices and sluggish economies. The pan-

demic has only increased their needs. By

next year public-debt ratios in many of

these countries will be at their highest in

two decades (see chart). The region’s 11 oil-

and-gas-exporting countries owed an aver-

age of 25% of gdpfrom 2000 to 2016. Next

year the imfprojects that ratio will hit 47%.

Increases are less stark in states without

energy resources—but only because they

already had high debt levels.

This is not always cause for concern.

Saudi Arabia’s debt-to-gdpratio will reach

an estimated 34% next year, up from 17% in

2017. Debt levels in Kuwait and the United
      Arab Emirates will almost double as well,
      to 37% and 38%. These numbers are still
      comfortably low. All three have well-provi-
      sioned central banks or flush sovereign-
      wealth funds. And capital is cheap: a 35-
      year tranche of Saudi Eurobonds issued in

BEIRUT

Bigborrowingtocopewithcovid-19

hasnottranslatedintobigstimulus

DebtintheMiddleEast

Notflatteningthe

curve

Ivory Coast seemed to be moving in the

right direction, too. Mr Ouattara took over

in 2011, after a disputed election and much

bloodshed. The economy grew faster than

most in Africa. But democracy has suf-

fered. In 2016 Mr Ouattara wangled changes

to the constitution which, he claims, reset

the clock on his time in office, so that its

two-term limit would not apply to him un-

til after a fourth term. In August he reneged

on his decision to retire and said he would

run again. The constitutional council

waved through his candidacy and blocked

40 of 44 other contenders from running,

including several big names. Since then

there have been protests and ethnic vio-

lence. Dozens of Ivorians have been killed.

When the time came to vote, the opposi-

tion called for civil disobedience. Protes-

ters smashed up polling stations and pre-

vented voting in some areas. At least five

people were killed in clashes. A significant

chunk of the population did not vote. The

electoral commission says that 21% of poll-

ing stations never opened. The auand the

Economic Community of West African

States (ecowas), another regional bloc,

nonetheless called the poll “satisfactory”.

Officially Mr Ouattara took 94% of the vote.

The Ivorian opposition is not backing

down. Rather, it is setting up a parallel gov-

ernment, led by an 86-year-old, Henri Ko-

nan Bédié, who ran against Mr Ouattara in

the election. Its aim is to organise a new

election. Mr Ouattara’s men call this sedi-

tion. Tensions are rising. On November 3rd

riot police surrounded Mr Bédié’s house

and used tear gas to disperse journalists be-

fore carting away some 20 people, includ-

ing a former minister of health. The houses

of other opposition figures were also sur-

rounded. As The Economistwent to press Mr

Bédié had not been arrested.

With each side taking such extreme po-

sitions, dialogue looks remote, says Wil-

liam Assanvo of the Institute for Security

Studies in Abidjan, Ivory Coast’s commer-

cial capital. He thinks the crisis will wors-

en, as leaders are arrested and clashes

break out between rival factions and ethnic

groups. Parts of the armed forces do not

view Mr Ouattara as legitimate, he adds.

Guillaume Soro, a former prime minister

and rebel leader exiled in France, has called

on the army to act against Mr Ouattara.

Over 3,000 people have fled the country.

International mediation is desperately

needed, says Arsène Brice Bado of the Jesuit

University in Abidjan. But regional bodies

tend to favour incumbents. In 2015 the

members of ecowasdiscussed a proposal

to restrict presidents in the region to two

terms, but it was ultimately dropped. The

limp response of ecowasto the situations

in Guinea and Ivory Coast has made oppo-

sition parties even angrier.

Guinea, Tanzania and Ivory Coast are

setting a bad example just as an election

season in Africa heats up. Burkina Faso, the

Central African Republic, Ghana, Niger and

Uganda all go to the polls in the next few

months. Their leaders might do well to

look instead to the Seychelles, where last

month the opposition won a presidential

election for the first time since indepen-

dence in 1976. The loser graciously attend-

ed his opponent’s victory speech. 7

Dodging a police dragnet in Tanzania after the election

Notwo-termlimit

Source: Africa Centre

for Strategic Studies

Leaderleftofficewhen

thelimitwasreached

*President ran for third

term and provisionally

declared victory, but the result

is currently contested (Nov 2020)

Limit retained after attempt

to modify or eliminate it

Leaderdid not leave

office whenthelimit

wasreached

Limit not yet reached

Past their sell-by date

Constitutional two-term limits, 2020

Ivory

Coast*

Ghana

Niger

CAR

Guinea*

Tanzania

Seychelles

Uganda

Burkina Faso