Specialist global risk consultancy, Control Risks in its annual political and security risk forecast RiskMap has revealed risks for business in Uganda and East Africa at large in 2018.
“In Uganda, speculation over President Yoweri Museveni’s succession plans is likely to persist, despite the likely passage of a constitutional amendment removing the age limit for presidential candidates. While these are unlikely to significantly harm businesses in the country, factionalism in the ruling National Resistance Movement (NRM) will complicate policymaking and lead to bureaucratic delays for businesses,” the report reads in part.
High debt levels in Kenya and unpredictable policymaking in Tanzania are among the key risks for businesses operating in the region in the year ahead, says Control Risks report.
Control Risks’ Senior Partner for East Africa Daniel Heal comments:
“2018 is set to be a promising year for Kenya and the East Africa region. We have started to see the recovery of investor confidence due to the return of political stability in Kenya, as well as renewed interest in major infrastructure projects both in Kenya and across the region. We expect this to continue throughout 2018.”
“However, in Kenya, a pending repayment of the first portion of a Eurobond worth USD 774.8m in 2018 should be a trigger for the government to refocus attention on controlling public borrowing and spending before debt becomes unmanageable.
Kenya has a strong appetite for external borrowing and has remained politically intransigent about its downsides. While Kenya remains highly unlikely to default on its debt, growing interest payments and international banks’ shrinking appetite to provide further loans will result in lower public spending, which has been a key driver for economic growth in recent years.”
