Africa | Favourable external backdrop but key risks remain

While risk assets are being carried by the tailwinds of strengthening global trade prospects, a policy-led weakening of the US dollar, and vaccine optimism, we are cautious of an African dividend falling due as idiosyncratic and regional risks increase. We investigate some potential challenges to growth recovery including factors that may drive divergence between frontier and emerging economies.

What you will learn:

• Risks which may be more pronounced in frontier economies than in emerging markets
• Limitations to traditional valuation frameworks exposed by the pandemic
• Shortcomings of policy response despite efforts to expand the monetary policy toolkit