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Welcome to the latest edition of Frontier Markets News. As always, I would love to hear from you at dan@frontiermarkets.co with news ideas, feedback and anything else you find interesting.  

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By Ken Stibler, Noah Berman, Nojan Rostami and Mariel Ferragamo. Executive editor: Dan Keeler

Africa

Nigeria moves to increase mining revenues

Nigeria is ramping up efforts to combat illegal mining and increase revenues from the sector, Premium Times reports. The country’s government this week approved a 2.5 billion naira ($1.7 million) plan to use satellite surveillance to combat illegal mining and announced the formation of a private-sector-led company to oversee the mining industry.  

Announcing the moves, mining minister Dele Alake said the satellite system would also enable monitoring of legitimate mines, noting that Nigeria has lost “trillions” of naira both to illegal mining and underreporting of output from legal mines. Illegal mining has also reportedly contributed to a rise in the use of child labor. 

The newly created Nigerian Mining Corporation will have a public-private equity structure with 50% allocated to the private sector, 25% for the government, and 25% for individuals. Alake said the shared ownership structure is intended to minimize government interference in the mining sector and prevent political manipulation in its operations, TV360 Nigeria reports.  

Ghana signs $50mn deal with UK to boost regional trade

The UK’s development finance institution, British International Investment (BII), this week announced a partnership with Ghana International Bank (GHIB) aimed at closing a roughly $90–$120 billion annual trade finance gap in seven African markets, Semafor reports. 

Through the plan, GHIB and BII will share risk on trade finance flows under a mutual risk participation agreement. GHIB will lend funds to businesses in the seven countries—Benin, Democratic Republic of Congo, Gambia, Liberia, Rwanda, Sierra Leone and Tanzania—through local banks to widen access to finance in markets that often lack global bank backing due to perceived credit risk. 

The deal’s backers said the facility would help companies import goods and equipment that should help them grow their operations and create jobs. The UK-backed plan comes against a trend of several international banks pulling out of African markets due to perceived risk, low profitability, and economic shocks.

US withdraws from energy transition financing partnership

The US has pulled out of the Just Energy Transition Partnership (JETP), a multi-billion-dollar climate finance structure developed by richer countries to help emerging economies move away from fossil fuels and toward clean energy. JETP, which was established in 2021 at the COP26 climate talks to support South Africa’s efforts to move to cleaner power, has since expanded to support three more countries: Indonesia, Senegal and Vietnam. 

The US had planned to contribute about $1 billion in commercial loans to South Africa, and another $3 billion for Indonesia and Vietnam, Business Insider Africa reports, but without those funds, countries will suffer. According to the president’s office in South Africa—where coal makes up about 80% of its electricity—grant projects that were previously funded and in “planning or implementation phases have been canceled.” The head of Indonesia’s JETP said that his country, too, would lose grant funding that would affect development of clean energy projects.

In response, some of JETP’s other donor countries, including the UK, France, Germany, the Netherlands and Denmark, reaffirmed their commitment to the program.

Asia

Vietnam prepares to court Europe as US tensions mount

Leaders from across Europe are planning to visit Vietnam in the coming months, as countries around the world strive to adjust to the raft of proposed—and actual—tariffs from the US, Reuters reports. 

The visits by French President Emanuel Macron and European Commission President Ursula von der Leyen would come as many European countries and Vietnam find themselves on the wrong end of President Donald Trump’s trade agenda. 

•  Thailand considers building wall on Cambodia border (The Diplomat)

The EU and Vietnam already have a robust trade relationship, although each counted the US as its largest export market last year. In a video address to top officials from the ASEAN bloc, von der Leyen said she hoped to “create new opportunities to trade and invest with trusted partners,” European officials reportedly also believe the negative impact of tariffs on Vietnamese companies currently focused on exporting to the US could create opportunities for European companies looking to invest there.

Pakistan buys in to BRICS development bank for $600mn

Pakistan announced on Monday that it will buy a 1.1% stake in the Shanghai-based New Development Bank for $582 million, Nikkei reports. The investment in the so-called BRICS bank, founded a decade ago by Brazil, Russia, India, China and South Africa, will be spread over seven years and potentially add a new source of funding to Pakistan’s menu of lenders.

It could also strain ties with the IMF, however, which last year approved a three-year, $7 billion loan to the South Asian country.

News of the investment came as a team from the IMF visited Pakistan to conduct a financial review that could unlock an additional $1.1 billion tranche of funding from the loan. Before the IMF team arrived on Monday, Pakistan’s finance minister Muhammad Aurangzeb said the country was “well positioned”for the review, Times of India reports.

Pakistan’s economy is in better shape than it has been in a while. According to official figures, its GDP grew 3.3% year-on-year in the last quarter of 2024, the highest in two years. Net foreign exchange reserves are also up almost 40% since last February, government statistics show.

Middle East

Egypt and Jordan race to present alternative to Trump’s Gaza plan

This week, Egypt and Jordan hosted a summit on Gaza with other Arab states, including key GCCmembers, to propose an alternative reconstruction plan to USPresident Donald Trump’s proposed takeover of the territory, the New York Times reports. The counterplan includes the introduction of a peacekeeping force, a fund for reconstruction and development, and the temporary takeover of Gaza by a technocratic committee with local input until formal handover to the Palestinian Authority.

Arab states have strongly rejected Trump’s proposal, arguing that displacement of Palestinians would destabilize the region. Jordan in particular has drawn a red line on taking any more refugees, citing domestic security concerns.

The US and Israel immediately rejected the counterplan, arguing that any peace deal must include the complete disarmament of Hamas’ military wing, which the Egypt-Jordan plan avoids discussing. Questions remain over funding of the plan, which suggests allocating $53 billion towards reconstruction, but does not specify who would allocate the funds or how they would be managed. 

US tariff threats spillover sinks GCC stock markets

The uncertainty and volatility roiling global equities markets from the seesawing US tariffs policy has this week spilled over into GCC stock markets, most of which recorded declines in parallel to the US markets, Zawya reports. Tariffs affect the GCC markets primarily by threatening lower growth in the US and China, which in turn lowers forecast demand for energy exports, the engine of most of these economies—despite their recent attempts to diversify. 

The prospect of a trade war also threatens key supply chains, causing losses to non-energy sectors including regional real estate and telecoms firms, which are heavily dependent on exports.

Caught in the middle between the US and China, most GCC states have thus far successfully played both sides to their benefit, but growing political pressure from the US has raised fears that they may be forced to turn away from China, a key trading partner, destination for energy exports, and source for infrastructure investments.

Europe

Poland gears up for a potential war with Russia 

Polish Prime Minister Donald Tusk has announced plans to seek access to nuclear weapons through France and build a 500,000-strong army to counter possible Russian aggression, Politico reports. The initiative comes as Poland grows increasingly concerned about the US President Trump’s apparent pivot away from traditional Western alliances, potentially leaving Poland vulnerable. 

The ambitious military expansion includes establishing mandatory training for all adult males and increasing defense spending to 5% of GDP, making Poland NATO’s top spender. Poland is already investing billions in American and South Korean weapons systems, including Abrams tanks, Patriot missile systems and F-35 fighters.

Despite these independent preparations, Tusk maintained that Poland is not abandoning NATO, calling the alliance with the US “absolutely fundamental.”

Latin America

Peru’s and Chile’s economies decouple from copper prices

Chile’s and Peru’s economies have broken from their historical pattern of moving in tandem with copper prices, as GDP growth trends lower despite the metal’s hitting record highs above $4 per pound between 2022-2024, according to ratings firm S&P. 

Among the reasons for the divergence is that regulatory burdens have proliferated in both countries, analysts say. In Peru, the number of administrative procedures related to copper production exploded from 12 in 2001 to 232 by 2020. Environmental approvals for new copper production in Chile can take up to three years to obtain.

These obstacles, combined with declining ore grades in Chile and social conflicts in Peru, have severely limited production growth and enabled competitors such as the Democratic Republic of Congo to gain market share. As a result, “total factor productivity”—a measure of an economy’s efficiency in converting inputs into outputs—has stagnated or declined in both countries, reflecting their inability to leverage copper revenues for broader economic gains.

Ecuador’s president pushes to fast-track Chinese investment

Ecuador’s President Daniel Noboa has escalated demands on a consortium poised to take control of the country’s premier oil asset, with President Noboa ordering an expedited $1.5 billion payment by March 11—three weeks ahead of schedule, Oil & Gas 360 reports. The president threatened to cancel the deal to operate the Sacha oil field—which was announced earlier this week—without prompt payment, citing urgent security and social spending needs.

Noboa had already raised eyebrows by awarding the $3.2 billion, 20-year deal with Chinese oil company Sinopec and its minority partner Canada’s New Stratus Energy without a competitive tender.

Financial markets are closely monitoring the situation as New Stratus Energy scrambles to secure its $600 million portion of the requested payment through creditors and share issuance. In the meantime, the deal faces mounting political opposition, and leading opposition candidate in April’s presidential election Luisa Gonzalez has vowed to rescind the agreement if she is elected.

Panama faces deepening deficit

Panama’s fiscal deficit has ballooned over the past year, leaving President Jose Raul Mulino’s administration with a daunting challenge to narrow the gap, according to a report by ratings firm Fitch. The 7.4% deficit recorded for 2024 exceeded the firm’s projections, prompting concerns that the government’s efforts to balance its books, including by boosting tax collections by an ambitious 42%, will be insufficient.

• Trading Places: IMF program eases El Salvador’s financing constraints (Fitch) 

Without structural measures, Fitch projects deficits will again exceed targets this year, pushing government debt to 67.3% of GDP by 2026—confounding authorities’ assertions that debt will stabilize. The government was hoping a proposed pension reform would help rein in the deficit, but the country’s legislature has suggested revisions that would actually increase government contributions, threatening to add to its borrowing needs.

What We’re Reading

Mali halts issuance of mining permits to foreign entities (Business Insider Africa) 

Malawi lowers 2025 growth forecast as inflation spurs protests (Reuters)

Germany halts new development aid to Rwanda over DRC conflict (Reuters) 

Mozambique’s dollar bonds fall amid political violence (Bloomberg)

China ramps up energy investments in Egypt (Oilprice.com)

Tunisian bank profitability faces pressure from new lending rules (Fitch)

Libya prepares to host bidding round for oil exploration after 17-year pause (Africanews)

Africa’s startup funding shrinks as Mastercard Foundation exits top VC firm (Rest of World)

Trump’s oil drilling plan threatens Africa’s top producers (The Africa Report)

China ‘will not step in’ to replace the USAID’s presence in Africa (Semafor)

Sri Lanka resumes car imports to stimulate economy (Nikkei)

Myanmar wins Russia’s help in nuclear plant construction as general visits Moscow (Reuters)

Thailand soon to launch carbon tax, Malaysia to follow next year (Nikkei)

Kazakhstan’s oil output hits record high (Offshore Technology)

Kazakhstan launches digital investment coin (Astana Times)

Steep fall in non-oil revenues crimps Oman’s export growth (Arab Gulf Business Insight)

Russia offers to mediate talks between US and Iran despite Ayatollah’s pivot (Reuters)

Saudi Aramco trims dividend as profits dip in blow to Riyadh’s budget balance (Bloomberg)

Warburg Pincus partners with Saudi Arabian pension fund Hassana to develop local PE market (Bloomberg)

Sacking of Iran’s finance minister deals blow to reformists (FT)

Romania’s stock exchange and EBRD launch governance push (Romania Insider)

BlackRock to buy Panama Canal ports after pressure from US (FT)

Foreign investors in Peru’s state oil company risk nation’s turbulent politics (FT Energy Source)

Early election trade is brewing for Latin America investors (Bloomberg)

EM creditors ‘should look to the cold war period’ for risk insights (Bloomberg FICC Focus)

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