A version of this article was first published in the February 2024 edition of FA News.

This year will be defined by the sheer volume of elections taking place worldwide and Africa is no exception, with a third of the continent voting in national elections.  This includes South Africa but also in other major economies such as Algeria, Ghana and Tunisia among others.

Many commentators expect South African President Cyril Ramaphosa to win the legislative election, but are also predicting margins to be tight, so there is a chance that the ANC could fall short of securing an overall majority and be required to work with smaller parties. In other nations, incumbent parties are expected to come under pressure, which could have the effect of raising political tensions.

Political risk will therefore be one for the insurance industry to keep an eye on in 2024. The National Assembly elections could, for the first time, deliver a hung parliament and a coalition government.  Tight election results can create uncertainty about how a new government would tackle the many challenges that the country faces and potentially increases risk.

On the back of armed conflict across the Sahel; Chad, Mali and Burkino Faso are due to hold presidential elections this year, although a number of these have already been delayed. Insurers will likely be considering the extent of their risk appetite when contemplating this, given that contested results could increase the chance that tensions are further inflamed.

This means that insurance intermediaries will have a vital role to play in the next 12 months: ensuring that much-needed investment continues to arrive and support critical infrastructure and the transition to more sustainable forms of energy. Despite these issues, the African economy is anticipated to grow strongly next year, meaning that there will be no shortage of demand for cover and international capacity.