Holdout leaders stymie Africa's rise


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JOHANNESBURG // The great democratic and economic strides made by African countries in the past decade risk being checked by ageing leaders unwilling to pass the baton.

For generations of foreign investors accustomed to the likes of Uganda's Idi Amin and the former Zaire's Mobutu Sese Seko, it took a while to shake off the stereotype of African leaders as psychotic kleptocrats hellbent on retaining power.

And not without justification. From 1960 to 2010, during 653 elections on the continent, the incumbent conceded defeat just 16 per cent of the time, according to an African Development Bank study.

But as better governance has swept from Senegal to Lesotho, the world's perceptions have slowly caught up.

Investors who once fearfully dipped their toes in African waters, have seen that the old crocodiles are dead or dying and have begun to wade in.

Progress has not been universal, but in much of Africa, "Number One" is as likely to be a former World Bank economist as an army general.

So last week when Robert Mugabe, 89, was sworn in as Zimbabwe's president for another five years, it was something of a blast from the past.

"I still have ideas, ideas that need to be accepted by my people," Mr Mugabe, who has ruled Zimbabwe since independence in 1980, told The New York Times on the eve of the vote.

If the election results are accurate, Mr Mugabe's anti-colonial message won him 61 per cent support in a country where 60 per cent of the population have never experienced colonialism.

But Mr Mugabe is far-from the only independence-era leader still kicking about in the presidential palace.

The average age of leaders on the African continent is around 60 years old, yet half of the population is under the age of 19.

"What's wrong with us?" Sudanese-born billionaire Mo Ibrahim recently asked, wondering whether Barack Obama could have become president of Kenya aged 47.

Probably not, concluded Mr Ibrahim, who in 2006 created a foundation that awards prizes for achievement in African leadership and monitors good governance on the continent.

In Angola, Jose Eduardo dos Santos has been in power for fractionally longer than Mugabe's 33 years. He won another five-year term last year.

The Angolan economy is growing at a clip, but corruption is rife and while the rich have done well, wealth has not spread very far from Mr dos Santos's inner circle.

His daughter Isabel dos Santos is rumoured to be worth around $3 billion (2.4 billion euros).

Aside from Mr Mugabe and Mr dos Santos, there is a long list of African leaders old enough to draw their pensions.

They include Ethiopia's Girma Wolde-Giorgis, 88, Cameroon's Paul Biya, 80, Zambia's Michael Sata, 76, Equatorial Guinea's Teodoro Obiang, 71, and Uganda's Yoweri Museveni, 69.

Having old leaders is not unique to Africa, and it has long been suggested that a culture of respecting elders could explain the predominance of relatively old leaders.

That may be so, but it is not without consequence.

African leaders have a proclivity to die in office, with often destabilising results.

When Malawi's Bingu wa Mutharika died in office in early 2012 his death was kept secret and his body flown around Africa as would-be successors plotted ways of staging a constitutional coup.

In the end the plots were averted and vice president Joyce Banda took power, but the risk was real.

Around the same time Guinea-Bissau suffered a very real coup after president Malam Bacai Sanha died in a Paris hospital. The country is still in crisis.

Alex Vines, of London's Chatham House, said the number of long-serving African leaders is reducing and those that remain have had to curb their ambitions.

"Following Arab Spring in North Africa, leaders like dos Santos have reconsidered ambitions for dynastic succession," even if others like Mr Obiang still favour that model.

"African leaders that have served over 30 years as leaders are increasingly rare."

"Where there are freer votes, we are seeing Africa's youth bulge play a role."

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MATCH INFO

Uefa Champions League semi-final, first leg
Bayern Munich v Real Madrid

When: April 25, 10.45pm kick-off (UAE)
Where: Allianz Arena, Munich
Live: BeIN Sports HD
Second leg: May 1, Santiago Bernabeu, Madrid

MATCH INFO

Uefa Champions League semi-final, second leg result:

Ajax 2-3 Tottenham

Tottenham advance on away goals rule after tie ends 3-3 on aggregate

Final: June 1, Madrid

RESULTS

6.30pm: Emirates Holidays Maiden (TB) Dh 82,500 (Dirt) 1,900m
Winner: Lady Snazz, Richard Mullen (jockey), Satish Seemar (trainer).

7.05pm: Arabian Adventures Maiden (TB) Dh 82,500 (D) 1,200m
Winner: Zhou Storm, Connor Beasley, Ali Rashid Al Raihe.

7.40pm: Emirates Skywards Handicap (TB) Dh 82,500 (D) 1,200m
Winner: Rich And Famous, Royston Ffrench, Salem bin Ghadayer.

8.15pm: Emirates Airline Conditions (TB) Dh 120,000 (D) 1,400m
Winner: Rio Angie, Sam Hitchcock, Doug Watson.

8.50pm: Emirates Sky Cargo (TB) Dh 92,500 (D) 1,400m
Winner: Kinver Edge, Richard Mullen, Satish Seemar.

9.15pm: Emirates.com (TB) Dh 95,000 (D) 2,000m
Winner: Firnas, Xavier Ziani, Salem bin Ghadayer.

Dhadak 2

Director: Shazia Iqbal

Starring: Siddhant Chaturvedi, Triptii Dimri 

Rating: 1/5

FFP EXPLAINED

What is Financial Fair Play?
Introduced in 2011 by Uefa, European football’s governing body, it demands that clubs live within their means. Chiefly, spend within their income and not make substantial losses.

What the rules dictate? 
The second phase of its implementation limits losses to €30 million (Dh136m) over three seasons. Extra expenditure is permitted for investment in sustainable areas (youth academies, stadium development, etc). Money provided by owners is not viewed as income. Revenue from “related parties” to those owners is assessed by Uefa's “financial control body” to be sure it is a fair value, or in line with market prices.

What are the penalties? 
There are a number of punishments, including fines, a loss of prize money or having to reduce squad size for European competition – as happened to PSG in 2014. There is even the threat of a competition ban, which could in theory lead to PSG’s suspension from the Uefa Champions League.

What the law says

Micro-retirement is not a recognised concept or employment status under Federal Decree Law No. 33 of 2021 on the Regulation of Labour Relations (as amended) (UAE Labour Law). As such, it reflects a voluntary work-life balance practice, rather than a recognised legal employment category, according to Dilini Loku, senior associate for law firm Gateley Middle East.

“Some companies may offer formal sabbatical policies or career break programmes; however, beyond such arrangements, there is no automatic right or statutory entitlement to extended breaks,” she explains.

“Any leave taken beyond statutory entitlements, such as annual leave, is typically regarded as unpaid leave in accordance with Article 33 of the UAE Labour Law. While employees may legally take unpaid leave, such requests are subject to the employer’s discretion and require approval.”

If an employee resigns to pursue micro-retirement, the employment contract is terminated, and the employer is under no legal obligation to rehire the employee in the future unless specific contractual agreements are in place (such as return-to-work arrangements), which are generally uncommon, Ms Loku adds.

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Results
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Ten tax points to be aware of in 2026

1. Domestic VAT refund amendments: request your refund within five years

If a business does not apply for the refund on time, they lose their credit.

2. E-invoicing in the UAE

Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption. 

3. More tax audits

Tax authorities are increasingly using data already available across multiple filings to identify audit risks. 

4. More beneficial VAT and excise tax penalty regime

Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.

5. Greater emphasis on statutory audit

There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.

6. Further transfer pricing enforcement

Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes. 

7. Limited time periods for audits

Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion. 

8. Pillar 2 implementation 

Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.

9. Reduced compliance obligations for imported goods and services

Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations. 

10. Substance and CbC reporting focus

Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity. 

Contributed by Thomas Vanhee and Hend Rashwan, Aurifer

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Based: Abu Dhabi

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