need to consolidate stability and focus on
building effective working relationships
with county governments to keep politi-
cal risks at bay. It will also need to focus
on stimulating the private sector by re-
assessing the interest rate cap, encourag-
ing more private sector involvement in
infrastructure projects and continue to re-
duce bureaucratic hurdles.
Regulatory risks in Tanzania
Unpredictable policymaking in Tanzania
will continue to present major regulatory
risks for international and regional in-
vestors. President John Magufuli’s grip on
power is tightening, and his authoritarian
style and erratic approach to legislation
will further damage investor confidence.
He will continue to use nationalistic legis-
lation in the extractives industry as a way
of increasing government revenue and
addressing fiscal restraints, presenting a
range of regulatory and political risks for
investors in the short-to-medium term.
Security and operational risks as a result
of political pressures in Ethiopia and
Uganda
In Uganda, speculation over President
Yoweri Museveni’s succession plans is
likely to persist, despite the likely passage
of a constitutional amendment removing
the age limit for presidential candidates.
While these are unlikely to significantly
harm businesses in the country, faction-
alism in the ruling National Resistance
Movement (NRM) will complicate policy-
making and lead to bureaucratic delays
for businesses. In Ethiopia, the govern-
ment is likely to face further protests un-
less it seeks to broaden the political space
and make some leadership changes. This
will pose security risks for businesses in
the regions of Amhara and Oromia, and in
the border area between the latter and
Somali regional state.Southern African Region
Control Risks’ Senior Partner for Southern
Africa George Nicholls comments: “2018
will see continued uncertainty around po-
litical leadership in our Southern African
markets. The transitions in Zimbabwe and
Angola in 2017, elections in Mozambique
later this year, and factionalism within
South Africa’s ruling African National Con-
gress (ANC) once again remind businesses
in the region of the importance of gaining
a clear understanding of the impact of
such uncertainty on their risk environ-
ment.”Political transitions, generational change
Zimbabwe’s President Robert Mugabe
has stepped down, Angola’s President
José Eduardo dos Santos has been re-
placed by João Lourenço, and Mozam-
bique’s President Filipe Nyusi is
consolidating his authority. Anticipating
and preparing for how these transitions
will affect business is essential for success
this year and beyond.Reputational risks in noisy political envi-
ronments
2017 saw a series of high-profile corrup-tion scandals in South Africa. These were
evident in a mass email leak showing fre-
quent improper communication among
senior government officials, politically
connected individuals and private busi-
ness interests. Some businesses have
learned the hard way that when a narrow
set of interests undermines and subverts
the integrity of state institutions, this pro-
vides a breeding ground for many other
risks to flourish. Protecting reputation –
and understanding what might compro-
mise it – has never been more important.Large-scale cyber attacks against infra-
structure
2017 was the year of major but random
disruptive attacks. This year could see the
likes of WannaCry, NotPetya and
BadRabbit recur, but in a more powerful,
targeted and disruptive manner. National
infrastructure systems are particularly at
risk.New threats in Mozambique
Major final investment decisions have
been taken on liquefied natural gas proj-
ects in northern Mozambique, signalling a
likely increase in foreign investment. Rapid
economic development in a marginalised
part of the country with little state capac-
ity will present a challenging security en-
vironment. The influx of money and
foreign workers will disrupt social struc-
tures and raise expectations of change, in-
creasing the risk of social discontent and
the formation of organised groups target-
ing public and private interests.Issue 11 | ...Celebrating the world’s richest continent | http://www.nomadafricamag.com | 41