This week, we start with a basic question that turns out to have a complicated answer: Where do African governments get their money?
The numbers on taxes are surprisingly different from other regions. From there, we look at the rise of Africa’s homegrown billion-dollar companies, who Africans think should pay for climate change and the continent’s growing investment in satellites.
And then we head to the mountains, before ending with one of the stranger black markets we’ve come across lately. Happy Friday.
Graphic of the Week
Africa’s Tax Problem
This report is really dense. Financing African Economies from Within, the World Bank Chief Economists of Government (CEoG) report, covers a lot of dry ground. But I said “wow” when I hit page 136.
The numbers show just how differently African governments raise money:
16% of GDP: What African governments collect in taxes, versus 21.9% in Latin America and 33.5% across the OECD.
19.3% of tax revenue: Comes from corporate income taxes, about twice the OECD share of 9.6%.
18.5%: Comes from personal income taxes, versus 23.5% in the OECD.
27.8%: Comes from VAT, the highest share among the regions compared.
Why it matters: Africa collects less tax overall and relies much more heavily on companies and consumption taxes to do it. Large informal economies and relatively few formal workers leave governments dependent on a narrow tax base.
That makes African budgets particularly exposed to falling corporate tax rates, tax incentives and multinationals shifting profits to lower-tax jurisdictions.
Africa’s tax challenge isn’t just how much governments collect. It’s also who they can collect it from.
What We Are Reading
Africa: The African Union will launch its own credit ratings agency Oct. 5, challenging the dominance of the global “big three” (Reuters); A predicted 2027 El Niño could push acute food insecurity up 20% to 274M people, while hitting West African coffee and cocoa production (FT); Africa is building its own space capabilities, spending more than $800M this year as cheaper satellites give governments sovereign access to critical data on crops, weather, infrastructure and security (FT).
Cameroon: President Paul Biya returned home after a 10-week absence abroad that had fueled concerns about his health (AP News).
Central African Republic: Rescuers recovered more bodies from a collapsed gold mine, raising the death toll above 100 (AP News).
Egypt: Huawei presented a bid to build AI data centers using its top chips, prompting the U.S. to assemble a competing American offer (Bloomberg).
Ethiopia’s official creditors backed a deal to restructure its $1B Eurobond, moving the country closer to emerging from its 2023 default (Reuters).
Guinea: A landslide at a landfill in the capital, Conakry, killed 30 people, officials said (AP News).
Kenya: Kenya Airways is courting new investors after its first-half loss has widened to $123M, hit by soaring fuel costs and aircraft shortages (Reuters).
Morocco’s 18-year-old Ayyoub Bouaddi joined Manchester City for a reported $117M, making him one of the club’s most expensive signings (Reuters).
Mozambique's state revenue rose 6.7% in the first half of 2026 (360 Mozambique).
Nigeria's President Bola Tinubu ordered a rescue operation after gunmen reportedly abducted about 600 people in Niger State (Reuters).
Somalia: Pirates hijacked a ship carrying Turkish weapons off Somalia's coast (AP News).
South Africa: MTN approved a $375M share buyback after adjusted half-year profit rose 21.3%, helped by stronger growth in Nigeria, Ghana, Uganda and fintech services (Reuters).
Tanzania’s vice president resigned less than a year into office, weeks after publicly calling for a new constitution (Reuters).
Tunisia’s cash in circulation jumped 16% to a record $10.5B, as tighter rules on check writing pushed more people toward cash, squeezing bank liquidity (Reuters).
Zambia closed its top courts on the final day the opposition could challenge President Hichilema’s re-election, raising concerns over access to the legal process (Reuters).
Business & Finance in Africa
Africa’s Quiet Giants
Source: McKinsey (2023) - note: see updated numbers below.
Africa’s biggest companies are increasingly African-owned, says The Economist this week. Two-thirds of companies with more than $1B in annual revenue are now locally owned and headquartered, a reversal from the era when foreign multinationals dominated the continent.
What’s happening: A generation of family-owned conglomerates is expanding across industries and borders.
Dangote Group: Aliko Dangote wants to build Africa’s first $100B company by 2030.
BUA Group: Abdul Samad Rabiu is expanding across cement, sugar and food, with a fortune of roughly $14B.
MeTL Group: Tanzania’s Mo Dewji wants to grow the family conglomerate to $10B by 2030.
The bigger picture: Africa had 345 companies with $1B+ in revenue in 2022. The Economist says there are 26 more today, bringing the total to about 371.
Why it matters: These sprawling conglomerates are partly a response to Africa’s fragmented markets. Companies diversify and vertically integrate because individual markets and supply chains often aren’t big or deep enough to support specialization.
The catch: Capital remains expensive, stock markets are shallow and political relationships matter enormously. Africa’s listed companies are worth about 33% of GDP, versus 61% across emerging markets and 113% globally.
Climate in Africa
Climate Bill Comes Due
Source: Afrobarometer
Another interesting finding in Afrobarometer’s African Insights 2026: Beyond Borders: Africans are increasingly looking to wealthy countries to take responsibility for climate change.
By the numbers:
+14 points: Average increase across 35 countries.
+42 points: Morocco, the biggest jump.
30+ points: Increases in Eswatini, Seychelles, Lesotho and Mauritania.
Why it matters: Africa contributes less than 3% of global greenhouse gas emissions, but climate change already costs African countries an estimated 2-5% of GDP on average (according to the World Meteorological Organization). The survey suggests Africans increasingly see that imbalance as a question of who should pay, not just who should act.
Zoom out: That doesn't mean Africans are passing the buck. 81% support government investment in infrastructure to withstand extreme climate events, while 69% back investment in wind and solar even if electricity prices rise.
Explorations in Africa
Snow? In Africa?
Source: AP Video
A weird thing for me to feature while sitting in the Northern Hemisphere, enjoying the sun in Morocco. Maybe I’m ready for some cooler weather.
What's happening: Thousands of skiers are heading to Lesotho each year, home to Afriski, the only fully operational ski resort in sub-Saharan Africa. Sitting 3,200 meters above sea level in the Maluti Mountains, the resort has 17 hectares of slopes and room for 420 overnight guests.
By the numbers: Nearly 70% of visitors come from South Africa, and Afriski's busiest day this year drew more than 1,400 people. The resort employs 227 full-time and seasonal workers, nearly all of them Basotho.
When to go: Ski season runs June through August. Natural snowfall can be unpredictable, but Afriski uses snowmaking machines to keep the slopes open throughout the winter.
Zoom out: Lesotho is the coldest country in Africa, with winter temperatures in the highlands dropping to around -8°C (18°F). And tourism matters. It contributed roughly 7% of Lesotho's $2.6B GDP last year. Safari, beaches and... ski boots.
P.S. from Africa
Ants Go Underground
Source: AP via The Economist
This one is good for the last week of August: ant smuggling.
The Economist this week reports that a global craze for exotic pet ants has created a booming black market in Kenya. Earlier this year, authorities caught a smuggler with more than 2,200 African harvester ants bound for China.
Follow the money: A queen worth about $3 in Kenya can fetch $200+ abroad.
Why it matters: In their native habitat, these ants disperse seeds, improve soil and feed wildlife. Conservationists fear the seizures are just the tip of the anthill.
We’ll be back next week, when September arrives and everyone’s inbox fills up again. Until then, send us what we missed, what you’re watching or what we should dig into next: [email protected].
