Brexit Sector Viewpoint: Africa Outlook

As the UK calls time on its 44 year membership of the European Union (EU), repercussions are felt further afield. African countries which currently access the EU via the UK, such as Egypt, Kenya, Nigeria and South Africa, or have the UK as their main end market within the EU will be exposed when the UK ceases to be an EU Member State.

The impact will be different according to trade patterns: for example, Francophone countries that traditionally trade more with EU countries other than the UK will be less affected than those whose main EU trading partner is the UK.

However, there are signs that the UK is keen to preserve and promote trade with Africa. In June 2017, the UK published its trade policy in relation to developing countries and in July 2017, the Minister for Trade Policy, Lord Price, visited South Africa and Namibia and met with ministers from the Southern Africa Customs Union (SACU) and Mozambique to discuss maintaining the existing trading relationship. There have also been recent official visits to The Gambia and Ghana.

Meanwhile, the depreciation in value of the pound relative to major currencies since the Brexit vote, is negatively affecting value for companies in Africa with revenues and reserves in sterling and may lead to companies converting reserves into US Dollars.

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