Africa will survive global meltdown - UBA chiefs

Odidison Omankhanlen, Lagos

From left, Group Chief Executive,
Intercontinental Bank Plc, Dr. Erastus
Akingbola; an executive director,
Mr Simon Araronu and the General
Manager, Retail Banking, Mrs Folake
Adeoye, during a press conference
in Lagos recently. IN spite of the current global economic challenges, investment managers from United Bank for Africa (UBA) Group’s London-based affiliate, UBA Capital Europe, have made a good case for Africa, stating that African economies were in much better shape to withstand external shocks than ever.

The UBA managers; Alex Trotter, Head of Asset Management, and Frank Dewotor Portfolio Manager, both of UBA Capital, joined a distinguished panel at the London Business School’s session on Africa and the Global Credit Crisis, held by the LBS Africa Club in London last week, asserted that there were good grounds, particularly given continued domestic demand, to feel optimistic about growth and investment in the continent.

Frank Senyo Dewotor led a presentation showing the great strides Africa has made in recent years in economic and political reforms, which provided a stronger base to tackle the challenges posed by the meltdown.

Alex Trotter, on his part, emphasised that Africa also had solutions to the challenges, illustrating the growing depth of local markets for financings and the recent UBA participation among other Cote d’Ivoire banks, in the $150 million syndicated loan to MTN – an example of African capital deploying to African businesses.

The optimism by the duo is also predicated on the following: Africa is not significantly exposed to global financial markets and economy given that it accounts less than four per cent of world trade; Africa as a commodity story is overhyped because domestic household consumption has more than doubled in the past 20 years in real terms, thus fuelling much of Africa’s growth rather than strong commodity prices, as is generally perceived; African countries are net importers of oil with the exception of a very few countries like Nigeria and Angola.

The event focussed attention on the effects of global economic events on Africa, examined causes and solutions, given particularly the up-coming G20 summit holding in London, where Africa ’s voice needs to be heard.

There was strong participation from a large audience of investors, African entrepreneurs, students and representatives of financial services giants including Goldman Sachs and Citigroup.