Alex Mills’ Post

Africa Private Equity News partner PwC South Africa has published its sixth South Africa Economic Outlook report for 2024, which focuses on the risk that drought and heat stress poses to the production of nine essential commodities. Read more below: https://lnkd.in/dGnPmK4i

🌍 Navigating geopolitical tides: Africa’s path to trade resilience and growth Despite the highly volatile and challenging global operating environment, African economies have shown remarkable resilience, recording output expansion of 3.2%, down from the 4% posted in 2022 and lower than the historical average of about 5% growth witnessed during the period 2011-2019 – but nevertheless recording one of the strongest output growths globally. However, most African countries continued to grapple with high inflationary pressures, debt accumulation, as well as climate change and other extreme weather events. The impact of weather shocks on Ghana’s cocoa output, preventing growers from taking advantage of rising global cocoa prices, was well articulated in a report by Afreximbank. These extreme weather events have intensified conversations around climate change. Equally topical is the AfCFTA and its role in expediting the growth and development of the African region. Read the full news 📌 https://lnkd.in/gptCiTyJ #EHSafrica #Logisitics #EHS #SupplyChain #WeLoveAfrica #AfricaLogistics #supplychain #logisticsolutions

https://lnkd.in/dtBwE8Ff ✅ The ongoing Red Sea conflict has significantly impacted global trade routes, shifting cargo traffic from the Suez Canal to the Cape of Good Hope due to Houthi rebel attacks. ✅ This diversion has increased trade volume around the Cape by an estimated 74%, while Suez Canal traffic plunged 50% in early 2024. ✅ As mentionned by Axios, this longer route not only delays shipments but also increases fuel demand and costs, contributing to higher oil prices and exacerbating inflationary pressures. ✅ With oil in transit reaching near-record levels, the disruption poses a substantial risk to global supply chains and economic stability, underlining the critical role of geopolitical factors in shaping global trade dynamics. #shipping #maritime #transpacific #transatlantic #supplychain #containershipping #oceanfreight #seafreight #containership

Compared to other regions of the world, #LatinAmerica is relatively insulated from the ongoing #RedSea trade disruptions. However, if the Israel-Hamas war expands into a regional conflict and has a meaningful impact on global #oil prices, it would place pressure on #inflation rates in the region. Download the full presentation: https://lnkd.in/gJmtREk3 #ConnectedThinking #LatAm

🛢️📈 Despite geopolitical tensions and a weakened Asian economy, #BrentCrudeOil has remained surprisingly stable. Read our chart analysis and which patterns suggest #BRENT is about to soar here: https://bit.ly/498uB5T #oil #oiltrading #commodities

🛢️📈 Despite geopolitical tensions and a weakened Asian economy, #BrentCrudeOil has remained surprisingly stable. Read our chart analysis and which patterns suggest #BRENT is about to soar here: https://bit.ly/3uIwFT1 #oil #oiltrading #commodities

Middle Eastern and North African countries have difficulty fulfilling grain contracts due to currency shortages. Large volumes of unloaded grain are stuck at ports. Egypt can receive financing from the International Monetary Fund (IMF) and International Islamic Trade Finance Corporation, but some participants doubt the IMF will help. Stuck volumes of grains were understood to be a common occurrence in the region in recent months, but moving stocks out of silos would increase costs beyond any potential for profitability. Read the full analysis by Anna Sneidermane at Argus Media: https://okt.to/qzicNW 𝗦𝘁𝗮𝘆 𝗰𝘂𝗿𝗿𝗲𝗻𝘁 𝘄𝗶𝘁𝗵 𝗔𝗿𝗴𝘂𝘀 𝗡𝗲𝘄𝘀𝗹𝗲𝘁𝘁𝗲𝗿𝘀: https://okt.to/DjouXk #agriculture #agribusiness #Indonesia #wheat

In the last week, Yemen’s Houthi rebels have escalated attacks on shipping containers in the Red Sea. Despite the increased tensions, market reaction has been muted so far. What are the implications moving forward? The question we often ask ourselves when a geopolitical event unfolds is whether the event in question is disruptive or destructive in nature. Historically, these events tend to fall into the disruptive camp: They may have short-term effects on the market, but very rarely have a material impact over the medium-to-longer term. Here are some stats: Since the 1940s, the average total drawdown during major geopolitical events has been approximately 4.5% and the number of days it takes to recover those losses is approximately 40 trading days. Without a doubt, it would make sense to add this to the list of events that investors should monitor. Few question the importance of maintaining open maritime shipping routes. Likely, we’ll see a short-term impact on supply chains. In fact, major shipping firms are already diverting their vessels away from the Red Sea, a route that accounts for 10% to 15% of global shipping flows. Those ships that have redirected are now required to go around the Cape of Good Hope (South Africa) which could add over 2 weeks of additional travel! Unsurprisingly, insurance on container ships travelling through the Red Sea has soared—a development that’s prompted speculation that we could be on the cusp of a redux of 2021, when supply chain disruptions led to a jump in inflation. At this point, we’re not expecting that to happen. Rather, we view current developments as a reminder that inflation data will likely be choppy and that short-term spikes shouldn’t be surprising. Crucially, we don’t believe it’ll nudge central banks into making a hawkish pivot. In other words, we’re still expecting to see rate cuts at some point this year. While geopolitical headlines will likely cause knee-jerk reactions in the market, we believe investors will be better served by focusing on market fundamentals instead of news. #finance #markets #money #globaltrade #investment #manulife #advisors #volatility #geopoliticalrisk

Dive deeper into maritime intelligence and trends with KPI OceanConnect’s Weekly Market Pulse!   In this week’s edition, there is generally good bunker availability and further improved notice periods across the 15 key port areas we cover.   We also report on the OECD - OCDE's economic outlook, OPEC’s oil market report with our own interpretation, as well as the impact on markets of the Red Sea diversions.   Our report is fuelled by data and analysis to provide the industry with unique and valuable insights.   Stay ahead of the curve and sign up now to receive your free Weekly Market Pulse: https://lnkd.in/eS7HSTjW   #MaritimeIntelligence #MarketTrends #WeeklyMarketPulse #Bunker #Innovation

Saudi Arabia's decision to not renew the petrodollar pact with the United States is a game-changer for the global economy. Established in the 1970s, the petrodollar system has been a linchpin of international finance, anchoring oil transactions to the U.S. dollar and solidifying the dollar’s role as the world’s primary reserve currency. This decision signals a seismic shift that could ripple through global markets and reshape economic alliances. For the United States, the immediate impact could be a reduced demand for the dollar, potentially leading to a depreciation of its value and rising inflation. The U.S. might need to rethink its economic strategies, focusing more on strengthening domestic economic policies rather than relying on the dollar’s international dominance. Globally, oil-importing nations might find new opportunities and challenges. With the possibility of paying for oil in various currencies, these countries could lower transaction costs and mitigate exchange rate risks. However, the increased currency market volatility could introduce new uncertainties in international trade. This decision also plays into the hands of countries like China and Russia, as they might leverage this opportunity to promote their currencies in global trade, accelerating the shift towards a more multipolar financial system. Oil-exporting nations will face a more complex landscape. While diversifying currency reserves can offer strategic advantages, the absence of a dominant transaction currency might complicate pricing and contract negotiations, potentially leading to inefficiencies. In the long run, this move could catalyze a rebalancing of global economic power. It highlights countries' need to adapt to a more fragmented and multipolar economic environment, where traditional alliances and financial systems are being redefined. Saudi Arabia’s decision underscores the beginning of a new era in international finance. The global economy must now navigate this transition, adapting to a world where economic influence is more dispersed, and agility and strategic foresight will be key to thriving in the new landscape. #petrodollar #oil #foreignpolicy Vipin Sharma Harshita Sharma Fin-Wiser Advisory