The African Union needs to step up to stop the coup contagion on the continent from spreading further, Charlie Robertson, head of macro strategy at FIM Partners UK Ltd, has said.
The putsch in Gabon is the latest in a string of coups that have taken place in Africa in recent years, and comes just a month after soldiers in Niger toppled Mohamed Bazoum, the first democratically elected president to succeed another in the landlocked country.
Robertson, in comments emailed to BusinessDay on Wednesday, described Gabon’s coup as “an important step-change in Africa’s coup contagion”.
“At last a coup has happened which financial markets actually care about – because Gabon has outstanding Eurobonds whose prices have dived this morning,” he said. “The price of the 2025 Gabon Eurobond has been marked down by traders by 10 percent, from 93 cents to 84 cents (up slightly from 79-82 cent range two hours ago).”
Until now, Africa’s recent spate of coups have all been driven by the same structural theme – which is illiteracy, according to Robertson.
“Countries with less than 40% adult literacy can’t grow sustainably, so political leaders cannot remain popular, which means they are always vulnerable to coups,” the former global chief economist at Renaissance Capital said.
He said low education also helps explain the conflict in Ethiopia, Sudan, as well as the coup in Burkina Faso. “Low literacy countries tend not to borrow from international markets.”
He said: “Gabon’s coup is strikingly different because it’s in a high literacy country, which is relatively wealthy in per capita GDP terms, at $9,000 in 2023, 10 times that of more coup-vulnerable countries like Mali.
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“Of course that wealth is not spread equally – but if coups were driven by inequality, we’d be saying hello to the new president Colonel ‘I know best’ in South Africa and Brazil too.”
The best case scenario is that this coup really is driven by frustration with a flawed election and a desire to allow the people a chance to vote in a free and fair election, according to Robertson.
“But if instead this is a more typical coup – then the global community and the African Union in particular have a big problem on their hands. The ineffective African Union has sat back and watched regime after regime topple in Africa and failed to reverse any of the coups in recent years,” he said.
He pointed out that leaders in Africa today, like Latin American dictators in the 20th century, are not likely to do a better job.
He said: “At least in some countries there’s been a chance to kick out a leader who does not deliver education for your children, but who’s going to argue with the policy choices of a man holding a gun.
“So the African Union needs to step up and take some responsibility for what’s happening on the continent, before the coup contagion spreads further.”
On what could be done, the economist said sanctions on Gabon would make paying the interest on its Eurobonds more complicated, adding that sanctioned Gabonese officers may not want to repay those bonds.
“Suspending aid – as has been done with Niger? The problem here is that it prolongs the decades of illiteracy and poverty that make coups more likely (and Gabon is probably not a big recipient of aid relative to others),” he said.
If the global community wants to stop coups – they need to start sending more aid to support education, according to Robertson.
“Threatening to cut off Gabon’s oil exports is another option, with again negative repercussions for bond holders…although China and some others may be happy to buy the oil anyway,” he said.
