Africa to Solve Europe’s Energy Problem?

In an effort to reduce reliance on Russia, European states are hoping African nations — such as Angola, Congo, Nigeria and Senegal — can meet their demand for fuel. Yet some officials are irked that this interest comes despite the same European states pressuring Africa to leave fossil fuels behind. “We need long-term partnership, not inconsistency and contradiction on green energy policy from the UK and European Union,” said Nigerian President Muhammadu Buhari in written comments. (Source: Bloomberg)

Zambia’s kwacha has surpassed the South African rand to become southern Africa’s second strongest currency. The kwacha has strengthened as a result of the country’s debt restructuring and tighter government spending — but consumers are not yet seeing the benefits.

Gloria Ngulube, a 29-year-old entrepreneur who buys and sells fashion accessories in Zambia’s capital, Lusaka, told OZY, “Prices are still high. Fuel is still up, so everything is up. I am not seeing the changes.”

Referencing Zambia’s recent economic difficulties, Joseph Kalimbwe of Zambia’s ruling United Party for National Development, told OZY, “The kwacha is on its path to full recovery.”

Meanwhile, South Africa’s rand has weakened as the country grapples with power outages due to supply shortages, as well as growing public debt and high food and energy prices.

Twitter shares fell 7.8% on Monday, translating to a $2.2 billion loss in value after the world’s richest man, Elon Musk announced last week that he would be pulling out of his planned $44 billion takeover of the company. On July 8, Musk, through his lawyer, made a filing to the U.S. Securities and Exchange Commission stating that he and his financial advisors had requested Twitter’s monetized daily average users and spam accounts information since May 9, but did not receive the information. As a result, Musk believes Twitter breached the initial agreement, and he now seeks to pull out of the takeover deal. Meanwhile, Twitter is pursuing legal action against Musk in order to enforce the deal. (Sources: Bloomberg, The Wall Street Journal)

Mexico’s annual inflation rate hit a 20-year high of 7.99% last month, as rising food and energy prices put pressure on the nation’s economy. This increase is expected to force the country’s central bank, Banxico, to further raise interest rates. While Russia’s war in Ukraine has caused prices to soar in Mexico and abroad, some experts say that Mexican inflation will soon level off. “We believe that inflation will peak in August or September, and should stay more or less stable around 7.5% and 8.0% for the rest of the year,” said Adrian de la Garza, chief economist at Citibanamex, according to Reuters. (Source: Reuters)

China’s largest e-commerce firm, Alibaba Group Holding Limited, and internet and technology company Tencent Holdings Limited saw shares decline on Monday following fines levied by the country’s State Administration for Market Regulation, which ruled that the companies had violated an anti-monopoly law. This ruling is seen as the latest move in the Communist Party’s crackdown on the nation’s tech sector. Industry insiders say that recent years’ handsome profits in the Chinese tech industry may never return. (Source: Bloomberg)

A Reuters survey of 1,700 Asia-based firms indicates a decline in these companies’ ability to pay interest on outstanding debt. Asian companies raised $338 billion in dollar- and euro-denominated debt last year — when rates were low. Now, amid interest rate hikes by the U.S. Federal Reserve, the value of Asian companies' dollar-denominated debt has surged, even as such companies face economic headwinds. Firms in Indonesia and Vietnam in particular may struggle with debt repayment. (Source: Reuters)

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Nord Stream on Monday shut down the single largest gas pipeline between Russia and Germany for annual maintenance. Scheduled to reopen on July 21, European businesses fear that the shutdown could extend much longer due to the Russian war in Ukraine. As a result, short-term energy prices doubled in Germany, Europe’s largest economy. According to Reuters, the Nord Stream 1 pipeline moves 55 billion cubic meters of gas annually. European nations continue to seek alternatives to Russian energy following its invasion of Ukraine. (Sources: Reuters, Bloomberg, The Wall Street Journal)

European multinational aerospace corporation Airbus has made an upward revision on projected deliveries of new jets over the next two decades, amid pressure on airlines to seek more energy-efficient models. Newly released data show that Airbus anticipates producing 39,490 new jets over the next two decades. Though passenger traffic has grown more slowly than predicted, Airbus expects traffic to return to pre-pandemic levels between 2023 and 2025. Meanwhile, China is expected to overtake the U.S. as the busiest aviation market. (Source: Reuters)

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