QUARTERLY UPDATE AFRICAN & FRONTIER MARKETS FUND

Highlights

The outlook for African markets and risk assets in general is positive for the rest of 2019 especially after the significant shift in global monetary policies which are supporting additional investors’ flows and interest. Additionally we have seen an increase in infrastructure investments, urbanization, foreign direct investments and increasing political stability combined with economic reforms which will be supportive to equity Markets.

General elections have concluded in Nigeria with the incumbent Buhari emerging as the winner. With elections and political uncertainty behind, the focus can now shift to the economy. Most likely there will be a continuity on both the monetary and fiscal front. The current central bank governor’s term ends in June and most in the investment community are expecting a continuity in the macroeconomic policy. Listing of MTN Nigeria in Q2 would also be closely followed by investors.

Early indicators suggest that the Kenyan economy maintained in Q4 2018 the 6% average GDP growth achieved in 2018, despite the private sector credit growth falling back to 2.4% YoY in December. The announcement by the High Court of a possible removal of the interest rate cap is very positive for markets however we await further details on what the new framework will be.