Africa

1. Processing lithium
2. US Exim’s “small” impact
3. VAT vs EVs
4. Gone but not forgotten
5. DRC’s attempted coup

Also, the puzzle of the ultimate pyramid scheme may have been solved.

Hello! Welcome to Semafor Africa. Long term gains or short term wins? Kenya’s government is trying to answer that question in its controversial finance bill. New taxes pit the long term goal of attracting e-mobility businesses and reducing carbon emissions with the more immediate need to generate new government revenues for a struggling administration. As Martin Siele reports from Nairobi, the desire to balance the books has won in this case.

Kenya’s president was bullish when he was asked about the bill’s various taxes at the Africa CEO Forum last week. “I wasn’t elected to be re-elected. I was elected to transform the country,” Ruto said, arguing that what’s “right” isn’t always popular. But this isn’t just about Kenya. Policymakers around the world are weighing up the long term benefits of green policies with political realities. Some critics argue, for example, that new tariffs on Chinese goods announced by the US president threaten progress on climate goals.

African leaders, on a continent that contributes less than 4% of global carbon emissions, will keep finding it hard to resist rolling out policies that threaten longer term green goals as low revenues and high debt servicing costs continue to bite. It comes as wealthier nations and regional blocs, such as the European Union, are rowing back on their climate commitments. The hope is that there will be more opportunities, like the lithium processing plant in Nigeria referenced in today’s edition, from which African economies can benefit. In the best cases, such projects have the potential to contribute to government coffers, create jobs, and cut carbon emissions.

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Chinese company to build lithium plant in Nigeria

The cost of a proposed lithium processing plant in northern Nigeria that will be built by Chinese company Canmax Technologies. The plant will have capacity to process 4,000 metric tons of lithium. Nigerian President Bola Tinubu said last week that he wants more lithium-producing states to “take full advantage of the global demand for lithium by developing even more processing plants” that will feed growing demand for electric vehicles.

US Exim bank’s Africa challenge

A scathing evaluation of the US Export-Import bank’s uneven approach to supporting US trade with sub-Saharan Africa has put its management on the backfoot — even as it scrambles to make the opposite case with recent deal announcements.

The report from Office of the Inspector General said the export credit agency had failed to expand its performance to achieve its sub-Saharan Africa mandate and in fact declined over the evaluation period from 2014 to 2023.

It also found that, despite multiple Exim officials taking initiatives related to the region, there was no specific program or office designated with the responsibility.

US Exim Bank, which is backed by the US government through a congressional charter, supports American exporters through a mix of loans, equity, and debt financing to compete globally. One of its roles is to help create jobs in the United States as well.

The report said its Africa initiatives have had “small positive impact” on domestic jobs and had “no impact on employment” in sub-Saharan Africa.

Earlier this month, US Exim Bank — which has operated on the continent since the 1940s — was the lead agency for a series of infrastructure deals worth nearly $1 billion with Angola announced at the US-Africa Business Summit in Dallas. Chair Reta Jo Lewis told Semafor Africa soon after the Angola launch that her agency was fully committed to delivering President Joe Biden’s Africa vision for investment and partnership over aid.

A senior Exim official pushed back at the report for not providing “a comprehensive picture of our efforts” in the region where it has a total exposure of over $8 billion.

— Yinka Adegoke

New taxes threaten to stifle Kenya’s growing EV sector

NAIROBI — Kenya’s push to introduce new taxes on some electric vehicles and batteries could stifle growth in the country’s fledgling e-mobility sector, experts have warned.

The country’s new finance bill proposes the introduction of value added tax on electric bikes and buses, as well as solar and lithium-ion batteries. It would also introduce an eco tax that would raise the price of a 60 kilogram solar battery in Kenya by $312 (45,000 Kenyan shillings), according to the Nairobi-based Associated Battery Manufacturers.

Kenya has previously sought to push up electric vehicle adoption. Tax breaks were cited by the country’s energy regulator as spurring a five-fold increase in the number of new electric vehicles registered in 2023. E-mobility startups in Kenya have raised more than $52 million in capital financing, the highest in Africa.

EV industry insiders say the new taxes could slow adoption and disincentivize e-mobility companies from setting up shop in Kenya.

Tom Courtright, research director at the Africa eMobility Alliance, said investor interest in Kenya’s EV sector would likely cool if the finance bill is passed in its current form.

Zuma’s party brushes off South Africa election ruling

Former South African president Jacob Zuma and his supporters were unfazed after suffering a legal blow when the country’s highest court ruled he could not become a member of parliament.

Zuma, the country’s president from 2009 to 2018, is the face of the political uMkhonto weSizwe Party (MK Party). The party was launched in December ahead of the country’s May 29 elections.

The African National Congress (ANC), which has ruled South Africa since the end of apartheid 30 years ago, needs 50% of the vote to continue governing without being forced to enter into a coalition with smaller parties. Zuma’s popularity in KwaZulu-Natal, his political stronghold, could see MK Party take votes from the ANC in that province and potentially scupper the ruling party’s bid to secure a parliamentary majority.

The constitutional court ruled on Monday that Zuma did not qualify to take up a parliamentary seat because of a law that prohibits people given a sentence of more than 12 months in prison without the option of a fine.

Zuma was sentenced to 15 months in jail in 2021 for contempt of court after refusing to attend a formal inquiry into allegations that his allies got state contracts during his presidency.

South Africa’s elections body said Zuma’s face would be on the ballot despite the court ruling. Under the country’s parliamentary electoral system, the leaders of political parties are featured on ballot papers.

Nhlamulo Ndlela, a spokesman for Zuma’s MK Party, said party members would not “deviate from our agenda” due to the ruling. “The court outcome simply sends a strong message to our supporters to vote for us in large numbers.”

— Sam Mkokeli in Johannesburg

DR Congo’s attempted coup

→ What happened? A coup was attempted in the Democratic Republic of Congo on May 19. Armed men attacked the homes of top government officials, including the prime minister and defense minister. President Felix Tshisekedi, re-elected in December for a second term, was not attacked, but his office in the capital Kinshasa was breached, according to reports.

→ What was the outcome? The government said it quelled the attempt. Christian Malanga, a US-based Congolese politician, was killed by security forces, army spokesperson Sylvain Ekenge said. Malanga attempted to overthrow a previous DRC president in 2017, Ekenge said.

→ Who else was involved? Malanga’s son and at least two other US citizens were arrested, according to Ekenge. The US State Department declined to confirm whether it had sought consular access to suspects “reported to be” Americans, citing privacy rules.

→ Why does this matter? One of Africa’s most populous nations, the DRC has the largest global reserve of cobalt and the seventh largest reserve of copper, making it influential in the clean energy transition. It is also grappling with conflicts, particularly one against the rebel organization M23, whom Tshisekedi has alleged are backed by the Rwandan government.

→ How did global bodies respond? US ambassador to the DRC Lucy Tamlyn pledged full support to “hold accountable any U.S. citizen involved in criminal acts.” The African Union “strongly” condemned the coup attempt.

— Alexander Onukwue

Governance

🇸🇳 Senegal’s Prime Minister Ousmane Sonko questioned France’s military presence in the country, and reiterated the country’s desire for self-determination was incompatible with the long-term presence of foreign military bases.

🇰🇪 A Kenyan lawyer filed an application on Friday seeking to stop the deployment of Kenyan police officers to Haiti, arguing it would contravene the constitution. About 200 Kenyan police officers were expected to be deployed to Haiti this week as part of a UN-backed security mission.

🇬🇭 Ghana’s parliament on Friday approved a $150 million loan agreement between the government and the World Bank to the country’s economic resilience.

Tech

🇿🇦 South African tech multinational Naspers made Fabricio Bloisi its new CEO with effect from July 1. He will also oversee the company’s European subsidiary Prosus.

🇳🇬 A Nigerian court ruled that Binance can be served with a tax evasion charge through one of its employees, Tigran Gambaryan, who has been detained in the country since February. His trial began on May 17.

🇨🇬 Congo Brazzaville is getting its first national data center to store and process data generated in the country. The $72 million project is funded by the African Development Bank and the Congolese government.

🇰🇪 Kenyan ecommerce company Copia told its more than 1,000 staff members that it may not meet payroll and could lay off some employees because “uncertainties lie ahead.”

Commodities

🇨🇮 Côte d’Ivoire’s cocoa regulator suspended around 40 cooperatives for hoarding more than 60,000 metric tons of cocoa since the start of the mid-crop in early April to sell at a higher price. Exporters are struggling to meet their contractual obligations following a long drought season and cocoa disease.

🇺🇬 The Ugandan government began reviewing its ability to mine uranium. It is examining its laws, capacity reserves, and environmental protection as it aims to develop nuclear energy by 2031.

Security

🇳🇪🇺🇸 US troops will complete their withdrawal from Niger by mid-September, according to a joint statement from Nigerien defense officials and the Pentagon released on Sunday.

Deals

🇺🇬 Uganda awarded a contract to Belgian firm Coil and Coppleters to reclaim land and dredge Lake Victoria by May next year to pave the way for the development of the new Bukasa port.

🇧🇯 Benin-based electric motorcycle provider Spiro agreed a $50 million debt facility with the African Export-Import bank to add battery swap stations and motorcycle models.

🇸🇳 Senegalese telecoms company Sonatel received a $94.5 million loan from the International Finance Corporation, British International Investment, and Proparco to improve its broadband delivery infrastructure.

The mystery surrounding the location of Egyptian pyramids situated between Giza and Lisht may have been solved. The answer lies in a long-lost branch of the Nile, according to a new study. Researchers from the University of North Carolina Wilmington used satellite imagery and excavation to reveal that a separate channel of the river once flowed parallel with the main Nile. The builders likely used that branch to transport the millions of tons of stone that made up the 455-foot-tall Great Pyramid of Giza, the researchers concluded. The channel may have dried up due to environmental changes.

• Imprisoned ex-Trump aide predicts second term priorities.
• Europe’s far right tout global support in parliament campaign.
• Could Apple’s news app be a lifeline for media companies?

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Happy national day to the people of Cameroon!! 🇨🇲

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— Yinka, Alexis, Alexander Onukwue, Martin Siele, Muchira Gachenge, and Jenna Moon