Opportunity in Africa abounds. Half of the world’s 25 fastest-growing economies are on the continent and according to the United Nations (UN), half of the anticipated global population growth between now and 2050 will occur in Africa. Upwards of 800 U.S. companies have a presence in South Africa alone. Yet, challenges remain: only 35 percent of the population in Sub-Saharan Africa has access to electricity and the World Bank estimates that an annual investment of approximately $90 billion is required to address the region’s infrastructure needs.
Inspired by the continent’s opportunities and eager to address its challenges, on November 13-15, Covington celebrated the opening of its office in Johannesburg, South Africa. As explained by the firm’s chairman Tim Hester in an interview with BBC Africa Business Report, Covington has built a top-notch project finance team in Johannesburg, London, and Dubai that is positioned to service companies throughout the continent.
The firm is also equipped to leverage its global resources to advise companies on the political and regulatory risks they may face in sub-Saharan Africa, focusing on six key compliance areas: (1) anti-corruption (including compliance with the U.S. Foreign Corrupt Practices Act (FCPA) and UK Bribery Act; (2) export controls and economic sanctions; (3) anti-money laundering; (4) privacy and data protection; (5) cybersecurity; and (6) competition, including cartel enforcement.
Complementing this compliance focus is Covington’s Africa Practice and its unparalleled global-problem solving capabilities, led by Witney Schneidman. Covington’s capabilities in this regard were aptly demonstrated by the firm’s assistance to South African telecom operator MTN in 2016, in which Covington Partner and former U.S. Attorney General Eric Holder assisted in negotiations with the Nigerian government, resulting in a favorable resolution that reduced MTN’s financial exposure by more than half.
Mr. Holder joined the Covington delegation in South Africa in November and shared his perspective on numerous issues, including the potential for the extraterritorial application of U.S. anti-corruption laws on the continent. Mr. Holder’s comments come against the backdrop of the corruption scandal involving the Gupta family and President Jacob Zuma, which has implicated a number of prominent multi-national corporates.
As reported by Business Day, Mr. Holder’s comments emphasized the broad extra-territorial reach of U.S. corruption laws, and noted that seven of the ten largest fines levied pursuant to the FCPA were against companies based outside the United States. Mr. Holder also noted the increased cooperation among global enforcement agencies and predicted that cooperation between U.S. authorities and local authorities in Africa would increase as economic growth on the continent continues and where national security issues that affect U.S. interests emerge. As Mr. Holder explained, in view of these risks, it is critical for corporations doing business on the continent to put robust compliance programs in place.
To view additional photos of Covington’s recent events in Johannesburg, click here.
Questions about Covington’s capabilities in Africa? Contact Worku Gachou at email@example.com.