Crypto News: Next Africa: Maiden IPO

Welcome to Next Africa, a twice-weekly newsletter on where the continent stands now — and where it's headed. Sign up here to have it delivered to your email.

Is Ethiopia getting back on track?

The Horn of Africa nation, whose plans for economic revival were dulled by a brutal internal conflict, is starting to open up to investors.

This week's first-ever initial public offering for 10% of its state telecoms company is an important milestone. While the sale is to local retail investors, it paves the way for a long-touted stock exchange that will help lure foreign investment — it's the only one of Africa's five biggest economies not to have a stock market.

The offer is the largest in Africa this year, with the shares in Ethio Telecom — its top mobile-phone service provider with almost 80 million customers — aiming to raise $255 million.

Pedestrians on a newly built walkway in Addis Ababa, Ethiopia. Photographer: Amanuel Sileshi/AFP/Getty Images

That follows a decision in August to end half a century of state control of its currency and moves to ease rules of doing business. The government hopes that allowing the birr to trade more freely will unlock more than $20 billion of financing, including a $3.4 billion loan from the International Monetary Fund (the first review of the bailout is imminent).

The country offered shares in the Ethiopian Securities Exchange to institutional investors in April, getting bids from FSD Africa, the Trade and Development Bank and the Nigerian Exchange Group, as well as 16 domestic commercial banks, 12 insurance companies and 17 local investors.

The developments have rekindled interest in the economy following a cease-fire agreement signed between the federal government and fighters from the northern Tigray region that ended a civil war in late 2022.

WATCH: Brook Taye, Ethiopian Investment Holdings CEO, speaks with Joumanna Bercetche and Jennifer Zabasajja.

That said, previous efforts to transform the economy through privatization never took hold, and regional violence continues to flare.

There is also growing disquiet among landlocked Ethiopia's neighbors about Prime Minister Abiy Ahmed's push to gain direct access to the ocean. And the giant dam on a Nile tributary has angered upstream nations Sudan and North African heavyweight, Egypt, in particular.

It also remains in default on its $1 billion eurobond, with creditors baulking at proposed restructuring terms.

The planned bourse is a tangible move, though, and could be a big step to bring Ethiopia into the global economic mainstream. — Fasika Tadesse

Key stories and opinion:
Ethiopia to Raise $255 Million in African Nation's Maiden IPO
Ethiopia Bondholders Say 18% Haircut Offer Isn't Reasonable
Egypt Sends Somalia Military Aid as Territorial Feud Simmers
Why Ethiopia Ended Half a Century of Currency Control: QuickTake
Ethiopia Bags $20 Billion in Funding, Braces for a Price Shock

Kenya's High Court suspended a parliament resolution to impeach Deputy President Rigathi Gachagua and halted the process of replacing him, less than an hour after President William Ruto appointed a successor. The court ruling delays until at least Oct. 24 the swearing-in of Kithure Kindiki. The Senate impeached Gachagua on Thursday night, after he was accused of inciting ethnic hatred and undermining the judiciary.

Demonstrators run through tear gas during a protest against the government earlier this year. Photographer: Kabir Dhanji/AFP/Getty Images

Mozambican opposition politician Venâncio Mondlane, who early vote counts placed second in the country's Oct. 9 presidential election, called for a countrywide strike Monday to protest preliminary results he's already rejected. He urged supporters to "paralyze" the country, according to a video posted to his social media channels including YouTube on Wednesday. Mondlane has repeatedly said he was winning.

South Africa told Taiwan to move its de-facto embassy out of its capital of Pretoria at the urging of China, a foreign ministry official in Taipei said, highlighting Beijing's expanding sway among developing nations. The decision marks a significant victory for Xi both to diplomatically isolate Taiwan and to use the BRICS grouping to become more influential around the world. In response, Taiwan may tell South Africa to relocate its representative office out of Taipei.

Tycoon Aliko Dangote is wealthier than ever now that his long-awaited Nigerian oil refinery is up and running, with the operation more than doubling his net worth to almost $28 billion, according to the Bloomberg Billionaires Index. But his mood suggests a man who just built his dream house only for the roof to start leaking. Separately, Flour Mills of Nigeria, the nation's largest miller, plans to spend as much as $1 billion over the next four years to expand its facilities and restructure after its majority shareholder offered to take it private.

Company flags near pipework at the Dangote refinery in the Ibeju Lekki district of Lagos, Nigeria. Photographer: Benson Ibeabuchi/Bloomberg

JPMorgan Chase opened representative offices in Kenya and Ivory Coast as part of an effort to expand in East and West Africa. The biggest US bank has hired Sailepu Montet, a former central banker in Kenya, to run its business there, while Michael Ahonzo Avou will lead operations in Ivory Coast. The move came as Chief Executive Officer Jamie Dimon visited Africa for the first time in seven years in a trip spanning Nigeria, South Africa and Kenya.

US President Joe Biden will visit Angola in the first week of December, honoring a pledge to travel to Africa just weeks before leaving office. Biden had originally planned to visit Angola earlier in October, but that trip — and one to Germany — were postponed as he decided to remain in the US to handle the preparations and federal response to Hurricane Milton. The president has sought to deepen US commitment to the continent in a bid to push back on growing Chinese and Russian influence.

WATCH: Wawira Njiru, founder and CEO of Food 4 Education, is one of 16 visionaries to be included in the 2024 class of Bloomberg New Economy Catalysts. Her organization provides nutritious meals to 450,000 children in public schools in Nairobi using cutting-edge technology and services. She speaks with Jennifer Zabasajja on "Bloomberg Horizons Middle East and Africa."

Next Africa Quiz — Nigeria's government summoned a diplomat from which country to protest the treatment of its national football team? Send your answers to gbell16@bloomberg.net.

Data Watch

Zambia's economy will probably expand 1.2%, the slowest pace since 1998 besides a contraction during the height of the pandemic in 2020.
Namibia's plans to retire two-thirds of its $750 million eurobond due next year are progressing well, with the nation amassing $407 million of the $500 million needed, central bank Governor Johannes !Gawaxab said after he announced a 25 basis-point interest-rate cut to 7.25%.
Tanzania's economic growth slowed to 5.3% in the second quarter.
Nigerian inflation climbed to 32.7% in September, the first acceleration in three months.

Coming Up

Oct. 20 Egypt trade balance for August
Oct. 22 South Africa leading indicator for August, Zimbabwe's ruling Zanu-PF holds annual conference, BRICS summit starts in Russia
Oct. 23 South Africa inflation data for September

"I didn't know what we were building was a monster."

Aliko Dangote

Africa's richest person

Dangote was commenting in a Bloomberg interview about his company's 650,000-barrels-day oil refinery that took three-and-a-half times longer to build and cost more than twice as much as initially planned.

Around the Nyakuron Market in downtown Juba, the stench of rotting trash hangs heavily in the air. Traffic congestion limits access to shops, and power outages are rife, disrupting business in South Sudan's capital. The scene of urban decay is just the tip of a catastrophic economic breakdown since a pipeline carrying oil that accounts for more than 90% of government revenue ruptured and dried up coffers of the world's newest nation, which gained independence from Sudan in 2011.

Bloomberg's Simon Marks joins Jennifer Zabasajja to discuss the deteriorating conditions in South Sudan.

The broken infrastructure, which until recently carried more than 150,000 barrels of crude oil to the Red Sea coastline in Sudan, ceased operating in February following a blockage caused by gelling in the pipeline due to a lack of diesel needed to thin out the crude. With part of the pipeline in an active conflict zone in Sudan where a brutal civil war is ongoing, repair work has been slow.