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Power Africa Releases Annual Report
August 22, 2017 | 0 Comments

Power Africa, a U.S. Government-led initiative to double access to electricity in sub-Saharan Africa, has released its annual report. The initiative consists of more than 150 public and private sector partners, which have collectively committed more than $54 billion towards achieving Power Africa’s goals. It is among the world’s largest public-private partnerships in development history.

The 2017 report highlights how Power Africa continues to lay the foundation for sustainable economic growth in Africa while creating opportunities for American businesses as it makes progress towards its goals of increasing installed generation capacity by 30,000 megawatts (MW) and adding 60 million new electricity connections by 2030.

Since its inception, Power Africa has facilitated the financial close of power transactions expected to generate more than 7,200 MW of power in sub-Saharan Africa. The 80 Power Africa transactions that have concluded financing agreements are valued at more than $14.5 billion, and Power Africa projects have generated more than $500 million in U.S. exports. In addition, Power Africa has facilitated more than 10 million electrical connections, which have brought electricity to more than 50 million people for the first time.

The report also highlights the role of women in Africa’s power sector, by chronicling the contributions of select members of Power Africa’s Women in African Power (WiAP) network. It includes an executive letter from the Honorable Irene Muloni, Minister for Energy and Minerals in Uganda, as well as profiles of women whose drive is strengthening Africa’s power sector.

Over the next year, Power Africa will work with more than 100 U.S. companies, African partners, other donors, and the private sector to harness the technology, ingenuity, and political will necessary to bring the benefits of modern energy to even remote parts of Africa while promoting economic growth. The initiative will also expand beyond its initial focus on solar lanterns and renewable energy to support more on-grid power projects in natural gas and other sources.

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Philanthropists join forces to fund Africa’s cash-strapped health sector
August 22, 2017 | 0 Comments

Billionaires Bill Gates, Aliko Dangote come together to fund health care projects

Tristate Heart and Vascular Centre in Nigeria. Photo: Tristate Heart and Vascular Centre

Tristate Heart and Vascular Centre in Nigeria. Photo: Tristate Heart and Vascular Centre

In the 2017 World Happiness Report by Gallup, African countries score poorly. Of the 150 countries on the list, the Central African Republic, Tanzania and Burundi rank as the unhappiest countries in the world.

Some of the factors driving unhappiness are the poor state of the continent’s health care systems, the persistence of HIV/AIDS, malaria and tuberculosis, and the growth of lifestyle diseases such as hypertension, heart disease and diabetes.

Few African countries make significant investments in the health sector—the median cost of health care in sub-Saharan Africa is $109 per person per year, according to Gallup. Some countries, such as the Democratic Republic of Congo (DRC), Madagascar and Niger, spend just half of that per person annually.

In 2010 only 23 countries were spending more than $44 per capita on health care, according to the World Health Organization. These countries got funding from several sources, including government, donors, employers, non-governmental organisations and households.

Private investment is now critical to meet the considerable shortfall in public-sector investment, say experts.

While many international organisations, such as UNICEF and the International Committee of the Red Cross, continue to support Africa’s health care system, private entities and individuals are also increasingly making contributions. For example, Africa’s richest person, Aliko Dangote, and the world’s second richest person, Bill Gates, have formed a partnership to address some of Africa’s key health needs.

In 2014 the Nigerian-born cement magnate made global headlines after donating $1.2 billion to Dangote Foundation, which used the money to buy equipment to donate to hospitals in Nigeria and set up mobile clinics in Côte d’Ivoire.

A philanthropist himself, Mr. Gates wrote of Mr. Dangote in Time magazine: “I know him best as a leader constantly in search of ways to bridge the gap between private business and health.”

The Bill & Melinda Gates Foundation focuses, among other projects, on strengthening Africa’s health care resources. According to the Gates Foundation, as of May 2013 it had earmarked $9 billion to fight diseases in Africa over 15 years. In 2016 the foundation pledged to give an additional $5 billion over a five-year period, two-thirds to be used to fight HIV/AIDS on the continent.

While acknowledging the Gates’ generosity, locals noted that for many years the Foundation had invested in the oil companies that have contributed in making health outcomes extremely poor in some areas of Nigeria. These companies include Eni, Royal Dutch Shell, ExxonMobil, Chevron and Total.

Facing a backlash, the Gates Foundation sold off some 87% of its investments in major coal, oil and gas companies, leaving approximately $200 million in these stocks as of 2016.  Groups such as Leave It in the Ground, a non-profit organization advocating for a global moratorium on fossil exploration, are pushing for divestment.

“The link between saving lives, a lower birth rate and ending poverty was the most important early lesson Melinda and I learned about global health,” said Mr. Gates recently. The Gates Foundation supports reducing childhood mortality by supplying hospitals with necessary equipment and hiring qualified local practitioners to take care of patients and their children.

Dangote-Gates collaboration

In 2016, the Dangote Foundation and the Gates Foundation formed a philanthropic dream team when they announced a $100 million plan to fight malnutrition in Nigeria. The new scheme will fund programmes to 2020 and beyond, using local groups in the northwest and northeast Nigeria. The northeast has for the past seven years been ravaged by the Boko Haram’s Islamic militant insurgency, affecting all health care projects in the region.

Malnutrition affects 11 million children in northern Nigeria alone, and Mr. Dangote said the partnership would address the problem.

The Foundations had already signed a deal to work together to foster immunization programmes in three northern states: Kaduna, Kano and Sokoto.

The Gates Foundation states on its website, “Contributions towards the costs of the program by the Bill & Melinda Gates Foundation, Dangote Foundation, and state governments will be staggered across three years: 30% in year one, 50% in year two, and 70% in year three, with the respective states taking progressive responsibility for financing immunization services.”

The future of about 44% of Nigeria’s 170 million people would be “greatly damaged if we don’t solve malnutrition,” said Mr. Gates, at a meeting with President Muhammadu Buhari.

Building trust

Despite the many international and local efforts, cultural and religious factors often impede efforts to address Africa’s weak health infrastructure. For example, in 2007, religious leaders in northern Nigeria organized against aid workers administering polio vaccinations after rumours started circulating that the vaccines were adulterated and would cause infertility and HIV/AIDS.

In 2014, during the Ebola crisis, villagers chased and stoned Red Cross workers in Womey village in Guinea, accusing them of bringing “a strange disease”.

The big players may be Mr. Dangote and Mr. Gates, but others less well known are also making important contributions to Africa’s health care. After the 2014 Ebola outbreak in West Africa, for example, which resulted in the loss of about 11,300 lives, private companies in the three most affected countries—Guinea, Liberia and Sierra Leone—partnered with the government to fight the virus.

The Sierra Leone Brewery, for example, helped in constructing facilities for Ebola treatment. Individuals, such as Patrick Lansana, a Sierra Leonean communications expert, also volunteered their services for the Ebola fight. He said: “I joined the fight against Ebola because I wanted to help my country. My efforts, and those of others, made a difference. It would have been difficult for the government and international partners to combat the virus alone.”

Public-private partnerships

Private and public sectors need to collaborate to help Africa’s health care system from collapse, notes a report by UK-based PricewaterHouseCoopers consultancy firm. The report states that public-private partnerships, or PPPs, when fully synergised can bring about quality health care. Under a PPP in the health sector, for example, a government can contribute by providing the health care infrastructure, while private entities can be involved in the operations.

In a widely published joint opinion piece last April, Mr. Dangote and Mr. Gates stated that improving health care in Africa depends on a “successful partnership between government, communities, religious and business leaders, volunteers, and NGOs. This ensures that everyone is rowing in the same direction.”

*Culled from Africa Renewal

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Partnerships at work in Africa
August 22, 2017 | 0 Comments
Governments need to on top of things
Henri Konan Bédié Bridge linking the north and south of Abidjan, Côte d’Ivoire. Photo: Bouygues Construction

Henri Konan Bédié Bridge linking the north and south of Abidjan, Côte d’Ivoire. Photo: Bouygues Construction

The construction of a liquefied natural gas terminal in Ghana to support power generation in the Kpone Power Enclave in the port city of Tema, near Accra, is reawakening hopes of an end to the energy crisis that has plagued the country in recent years.

Power outages have led to a rationing schedule that involves cutting power for 24 hours every two days. Businesses have been forced to connect standby power sources such as generators, incurring extra costs. Some have had to lay off workers.

The $600 million project, being implemented under a public-private partnership (PPP) between Quantum Power Ghana Gas and the Ghana National Petroleum Corporation, is expected to provide the West African nation with a reliable and efficient power supply.

The plant will add about 220 megawatts of electricity to Ghana’s national grid. The country now has 2,900 megawatts of generation capacity, not enough to meet the growing demand, which the National Energy Policy of 2010 estimated would be about 5,000 megawatts by 2016.

“We hope the project will address the dumsor once and for all,” says Nancy Osabutey, a resident of Accra. Dumsor (“on-off”) is a Ghanaian term commonly used to describe the erratic power availability in the country.

A recent report by the Institute of Statistical, Social and Economic Research, a Ghanaian-based think tank, estimates that the economy has lost $24 billion as a result of the energy crisis since 2010.

Like many African countries, Ghana is facing an infrastructure financing gap. Policy makers are starting to realise that PPPs can help fill such gaps.

“Africa has been growing over the last few years. It will be challenging to achieve economic growth without addressing the huge infrastructure financing and access gap in energy generation and transmission, roads and ports,” says Tilahun Temesgen, the chief regional economist at the Eastern Africa Resource Centre of the African Development Bank (AfDB).

The AfDB maintains that the continent needs about $100 billion per year for infrastructure investment, yet the total spending on infrastructure by African countries is just about half that, leaving a financing gap of about $50 billion.

“This difference should come from somewhere. Tapping into private-sector investment by unleashing the potential of PPPs is one innovative way of attracting financing for infrastructure in Africa, as this has a very high development and poverty reduction impact in Africa,” states Mr. Temesgen.

He adds, “Governments and development partners cannot fully close the current huge infrastructure financing gap. It is therefore vital to mobilise private-sector financing to support infrastructure developments.”

Private-sector financing is succeeding in different parts of the continent, just as it soon may in Ghana through the Kpone power plant.

In Côte d’Ivoire, the Henri Konan Bédié bridge in the capital, Abidjan, is considered one of the most successful PPP-funded projects in the post-conflict country.

The $265 million bridge, opened in 2014, connects two of Abidjan’s major districts—Riviera in the north and Marcory in the south—and has done away with over 10 kilometres of traffic congestion. About a hundred thousand vehicles use the bridge each day.

“This facility enables us to enjoy the benefits of better traffic conditions. We now take less time in traffic, meaning more time for productivity at work. A while ago we would spend more than three hours in traffic,” says Abraham Kone, a resident of Abidjan.

The bridge has also opened up the neighbouring hinterland, simplifying freight transportation to the Port of Abidjan, the largest port on Africa’s west coast.

Public-private partnership is also diversifying the country’s energy sector. The expansion of the Azito thermal energy plant involving the construction of two 144-megawatt power plants will save $4 million in energy costs each year and will enable Côte d’Ivoire to move from being a net importer of electricity to being a net exporter.

With the expansion, the energy plant, located six kilometres west of the port of Abidjan, is producing over 30% of electricity generated in Côte d’Ivoire, with some of it going to neighbouring countries, including Ghana.

Partnering with the private sector to promote sustainable development is something the government is talking a lot about.

According to Albert Toikeusse Mabri Abdallah, the Ivorian minister for planning and development, “Public-private partnership is in line with Côte d’Ivoire’s National Development Plan, which outlines building and renovating the country’s infrastructure to accelerate development.” The minister adds that “such collaboration will also ensure job creation and poverty alleviation.”

The Sustainable Development Goals (SDGs) envisage that PPPs can promote sustainable development in Africa. A key priority of the UN-founded SDG Fund is to bring together public and private entities to jointly address development challenges.

However, many African countries, according to an AfDB report, are still in the initial stages of PPP implementation “because their use of PPP schemes is still uncommon and PPPs are complex to implement.”

The report indicates that PPPs have historically been scarcer in sub-Saharan Africa than in the rest of the world. Telecoms transactions account form the bulk of PPPs on the continent, but energy PPPs have recently started growing significantly.

“PPPs are not easy. They need a number of issues to be successful. Above all, a stable macroeconomic environment is necessary,” explains Mr. Temesgen.

However, an environment characterised by inadequate regulatory frameworks, unclear rules and procedures and lack of political commitment inhibits growth of PPPs.

Uganda PPPs

Uganda is one of the countries with a solid PPP programme. According to the AfDB document, this is the result of many factors, including support from the presidency and the ministry of finance, an earlier successful privatisation programme and a well-designed framework.

At a meeting in South Korea last November, Ajedra Gabriel Gadison Aridru, Uganda’s state minister for finance, planning and economic development, cited the PPP Act enacted in 2015 as a major enabler of the country’s PPPs. The law spells out the specific engagements of private partners in such partnerships. It also regulates the roles and responsibilities of government bodies during the development and implementation of PPP projects.

Concerns have been raised about severe environmental hazards following PPPs. Ghana Gas Company, for example, has been accused of failing to act as areas such as Atuabo, in western Ghana, continue to suffer the effects of oil and gas exploration that have led to widespread air and water pollution.

Because of concerns like this, governments are being urged to disclose information on risk assessments, including potential environmental and social impacts, of such mega-projects. Institutions such as the Bretton Woods Project would like to see more informed consultations, broader civil society involvement and closer monitoring of PPPs by all stakeholders.

*culled from Africa Renewal

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Global companies give Africa a second look
August 22, 2017 | 0 Comments
South Africa hosts most of the top companies in Africa, but other countries are coming up
BMW South Africa announces the production of its one-millionth BMW 3 Series sedan at its manufacturing plant in Rosslyn, Pretoria in South Africa. Photo: BMW Group

When travelling abroad for work and looking for accommodation, Joe Eyango, a Cameroonian living in the US, considers two factors: convenient transportation from the airport and around the city and reliable Internet access. He is a university professor and wants to be able to jet in, hit the ground running, make his presentation and zoom off to another destination in a day or two.

Mr. Eyango has been to various countries in Africa for business and work but has reasons for preferring South Africa.

“South Africa has a lot to offer compared with other African countries. The road system is good, there is adequate electricity and reliable Internet connection, which is necessary for work and business,” Mr. Eyango told Africa Renewal in an interview.

Recently, having been invited to present a conference paper on a tight schedule, Mr. Eyango flew into Johannesburg from Amsterdam, spent less than 30 minutes in customs at the O. R. Tambo International Airport, took a taxi and was at his hotel in less than an hour since arrival.

South Africa attracts many professionals and big multinationals. It’s currently home to more than 75% of all top global companies in Africa.

“Where these big companies choose to invest depends on whether the environment is right for business. Investors are interested in relatively stable countries, good infrastructure, reliable communication, electricity and labour,” says Dr. John Mbaku, a researcher at Africa Growth Initiative at the Brookings Institution and also a professor of economics at Weber State University, US.

Some of the global companies with a presence in South Africa include luxury car manufacturers BMW, the Standard Bank Group, Barclays Bank, Vodafone (one of the world’s largest communication companies), Volkswagen, and General Electric. There is also FirstRand, Sasol, Sanlam, and MTN Group.

In an earlier interview with South African officials on why they’d chosen the country as an investment destination, Sam Ahmed, then the managing director of Britannia Industries, an India-based manufacturer of biscuits, snacks and confectionery, said his organization had been looking for a country that would give it access to the entire African market while keeping its costs low.

“In South Africa you have first-world infrastructure and third-world cost,” Mr. Ahmed said. The company’s production costs in South Africa were much lower than in Southeast Asia, the company headquarters.

Big businesses are also attracted to countries where the legal system works, so they can be assured of justice should legal issues arise. South Africa’s judiciary has been hailed for its sound judgements and independence from political machinations relative to other African countries.

Another attraction for big businesses is human resources. The efficiency and smooth operation of these large companies depend on the calibre of its labour force. Despite many years of apartheid, according to Mr. Mbaku, South Africa provides its citizens with relatively good quality education the multinationals are looking for in their labour force.

However, despite its successes, South Africa continues to grapple with a high crime rate (especially in urban areas), graft accusations and the political uncertainty that businesses loathe.

Dr. Mukhisa Kituyi, the secretary-general of the UN Conference on Trade and Development (UNCTAD), the UN body that deals with trade, investment and development issues, acknowledges that South Africa has the oldest and most developed market economy in the whole of Africa for historical reasons: the market grew out of a strong mining and industrial base and the financial industry.

However, according to Mr. Kituyi, things are now changing and other African countries are also attracting big investors.

“It’s true South Africa has had a head start, but in net terms, there is faster growth in alternative centres for both manufacturing and service delivery than in South Africa. Today, the financial services industry is growing faster in Morocco than in South Africa,” Mr. Kituyi told Africa Renewal in an interview.

He notes that some multinational enterprises operating out of South Africa have relocated substantially. “We recently saw the opening of the Volvo truck-manufacturing plant in Mombasa. And similarly, we have seen many other services, particularly IT-based services and telecommunications, growing in new nodes like Nigeria, Kenya and Rwanda.”

Fringe benefits

So why should African governments want to encourage global companies to set up shop in their countries?

Driven by insufficient funds, African governments are increasingly turning to private-sector companies for a much-needed boost. Foreign investments provide capital to finance industries, boost infrastructure and productivity, provide social amenities and create jobs, all of which can help a country reach its economic potential. And as countries rush to implement the Sustainable Development Goals, funding is key.

In Africa, governments and industry are gradually forming public-private partnerships (PPPs) in which companies provide capital while governments ensure an environment conducive to business. In the last 10 years, the continent has welcomed PPPs for projects in infrastructure, electricity, health and telecommunications.

Lenders like the African Development Bank are urging African countries to improve business environments by “creating the necessary legal and regulatory framework for PPPs, and to facilitate networking and sharing of experience among regulatory agencies and other similar organizations.”

Tread carefully

However, even as PPPs begin to change the face of Africa, there is need for countries to tread carefully and to learn from failed PPPs when signing up for such partnerships.

“Ask yourselves, does the state have the capacity to forge ahead with these partnerships? This is necessary to avoid bad debt,” says Mr. Kituyi, adding that governments should not let private companies drive the agenda.

This word of caution is echoed by the Brookings Institution’s Mr. Mbaku, who is advising African governments to ensure that PPPs work to their advantage: “If you have a weak or corrupt leadership, you may not have the power or the skills required to negotiate a favourable partnership. You will end up with a PPP that is not really a partnership.”

Mr. Mbaku gives the example of oil companies that have been operating in Africa for more than 20 years yet still depend on expatriate labour instead of employing locals. Such companies are reluctant to transfer skills, knowledge and technology to the locals.

Another problem with PPPs is the imbalance of power. “If you are a government engaged in a PPP on a development project, there is inequality in power. The multinational has capital, skilled manpower and [an] external market. The government has no power over these,” says Mr. Mbaku.

Despite the challenges, however, PPPs will continue playing a major role in the development of poor countries. For African countries to attract multinationals and other big investors to partner with, their governments need to put their house in order—improve infrastructure, communication, security and the legal system, and fight corruption.

*Culled from Africa Renewal

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Stanford Graduate School of Business Launches Two Educational Opportunities to Empower Youth and Entrepreneurs in Southern Africa
August 19, 2017 | 0 Comments
Silicon Valley-based university continues to expand global program offerings with new partnership with De Beers Group
STANFORD, California, August 18, 2017/ — Stanford Graduate School of Business(www.GSB.stanford.edu) (Stanford GSB) today announced a USD $3 million, three-year partnership with De Beers Group to empower young, budding entrepreneurs and owners of established businesses in Botswana, Namibia, and South Africa through two new educational programs launching in 2018.

Stanford is expanding two of its successful programs to Southern Africa: the Seed Transformation Program of the Stanford Institute for Innovation in Developing Economies, known as Stanford Seed(www.GSB.stanford.edu/seed), and the Stanford Go-to-Market(www.GSB.stanford.edu/programs/stanford-gotomarket-botswana) program for accelerating business ventures to market.

The two programs are:

  • Seed Transformation Program, a one-year program of intensive sessions on topics such as leadership, strategy, business ethics, accounting, marketing, and value chain innovations. Skilled facilitators assist participants in applying classroom insights, developing leadership teams, and formulating a detailed plan for organizational transformation and growth. Seed facilitators also work with participants in carefully constructed leadership peer groups, offering networking opportunities, resources, and ideas to help implement the participants’ transformation plans. The mission of the program is to enable business owners to lead their regions to greater prosperity through the growth of their companies and job creation. The program will be open to owners of established businesses in Botswana, Namibia, and South Africa. Applications will be accepted 17 August through 6 October, 2017.
  • Stanford Go-to-Market Program, an intensive, one-week entrepreneurship bootcamp, taught by Stanford GSB faculty, held in cities around the globe. Through a combination of lectures, case studies, and small-group discussions, the program helps budding entrepreneurs gain the confidence and skills to commercialize their business ideas and accelerate their route to market. While Botswana will host the first Stanford Go-to-Market program in Africa, the bootcamp may expand to include participants from other Southern African countries once fully established. Applications for the Stanford Go-to-Market program in Botswana will be accepted this fall and the cohort will convene in March 2018.

These new programs exemplify Stanford GSB’s commitment to creating lasting global impact by bringing the Stanford experience to new regions, engaging promising business leaders globally, transferring knowledge, and building relationships. Through these new programs, Stanford GSB has an opportunity to share insights through hands-on management education for students, while also gaining a better understanding of the business climate and unique economic attributes of Southern Africa.

“We are excited to work with the young and established entrepreneurs in the Southern African region. As with our experiences in East and West Africa, we are coming to learn as much as we are to teach,” said Jesper Sørensen, professor of organizational behavior at Stanford GSB and faculty director of Stanford Seed, a Stanford University initiative led by the Stanford GSB. “If the business and job growth that follows matches what we are seeing in our other locations, I anticipate this collaboration will be a very impactful initiative.”

The Seed Transformation Program launched in West Africa in 2013 and expanded to East Africa in 2016, and will open a third location in India later this month. Faculty, staff, and coaches have trained more than 500 business leaders with the goal of promoting prosperity in these regions.

Both the Seed Transformation Program and Stanford Go-to-Market program will be headquartered at the Botswana Innovation Hub, a science and technology park in Gaborone, Botswana. The initiative will be supported by a range of government entities in Botswana, including the Botswana Innovation Hub, the Botswana Ministry of Tertiary Education, and the Ministry of Youth Empowerment, Sport & Culture Development.

Located in the heart of Silicon Valley, Stanford University is known for its entrepreneurial spirit and leadership in research and learning. Stanford’s faculty and students work to improve the health and wellbeing of people around the world through the discovery and application of knowledge. Breakthroughs at Stanford include the first successful heart-lung transplant, the debut of the computer mouse, and the development of digital music. Stanford’s areas of excellence span a wide range of fields across seven schools, including the Stanford GSB.

 

https://vimeo.com/208402876

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Integrating Financial Services In Africa
August 18, 2017 | 0 Comments

By *

A defining objective of the African Union is to promote sustainable development at the economic, social and cultural levels as well as the integration of African economies. This noble mandate, enshrined in Article 3, of the Constitutive Acts of the AU, actually predates the AU, and was a principal goal of the Organization of African Unity, OAU, the predecessor body of the AU.

Emeke E Iweriebor

Emeke E Iweriebor

Economic integration also provided a fundamental impetus in the formation of the various Regional Economic Communities, RECs, and monetary zones in Africa – viz. ECOWAS, UMOA, CEMAC, CEEAC, EAC, AMU, CEN-SAD, SADC, COMESA, IGAD, etc. Together, these RECs have striven to promote and co-ordinate social, political and economic integration in the continent.Interestingly, some countries are even members of up two or three RECs. This is a testament to the overarching criticality of economic integration in the vision, plans and activities of African states.

In this treatise, I will focus on the integration of financial services in Africa, an unheralded field, but where remarkable results are being recorded. A Payment System is a facilitator of monetary transactions, and a veritable integrative node. In the UEMOA zone, in West Africa, the Groupement Interbancaire Monétique de I’UnionEconomique et MonétaireOuestAfricaine, more widely known by its French acronym, GIM-UEMOA, set up by BCEAO, the Central Bank of West African States in 2003, in striving to create a cashless region, has grown to become a regional platform for cards, electronic payments, and clearing of interbank transactions. With over 100 banks, financial and postal institutions as members; cardholders in the GIM network,pay relatively low transaction fees.

Also, the Central African equivalent, GIMAC,created in 2013, under the guidance of the Central Bank of Central African States, BEAC, is working with Banks to integrate the electronic payments system in the region, and ensure inter-operability and acceptance of GIMAC cards, for ATMs, POS, etc, by banks and for international payments,and reduce transaction and cash handling costs, while facilitating e-commerce.

The East African Payment System, EAPS, provides a platform for the real time settlement of cross border payments in the region. Driven by the Central Banks in the region, and piloted in 2013, the payment system took off immediately in Kenya, Uganda, Tanzania, and subsequently, Rwanda. More remarkable is that EAPS is based on direct convertibility, and the use of the currencies of participating countries for transactions and settlement, without the intermediary facilitation of any OECD currency. For instance, transactions initiated in Tanzania shillings can be directly settled in Uganda shillings or Kenya shillings.

In Southern Africa, the SADC Integrated Regional Electronic Settlement System (SIRESS),and the Regional Payment and Settlement System, REPSS, launched separately in 2014, are two integrative payments systems worth referencing. Through SIRESS, funds can be wired, real time, to beneficiaries with accounts in SIRESS commercial banks. REPSS, with a clearing house in Zimbabwe, and the Central Bank of Mauritius as its Settlement Bank, utilizes an electronic platform for cross-border payments and settlement.

Quite positively, these initiatives, operationalized under the auspices of Central Banks, and with the active participation of commercial Banks are technologically advanced, rapid, and secure. While leveraging on the real-time gross settlement systems of the countries, they seek to enhance efficiency, reduce settlement time, lower transaction costs and generally facilitate intra-African trade, and economic integration in the continent.

In tandem, the banking sector, in Africa, has expanded exponentially in the last decade, in asset size and profitability; geography -distribution channels and network; product sophistication- digital banking, cards, mobile payments; and, financial inclusion. Access to financial services continues to improve across the continent. Furthermore, leveraging on enhanced capacity, pan-African banks are increasingly able to collaboratively finance large ticket and transformational infrastructural projects through syndications and risk sharing. Currently, the top 20 pan-African Banks have assets over $800b, with over 11,000 branches. Beyond banking, we are also witnesses to the birth and growth of pan-African insurance, micro finance, and other financial service companies across the continent that offer greater diversity and depth of products and solutions. All these have led to the increase in the range, frequency, and diversity in the classes of risks that Banks, and other financial institutions, face. Concomitantly, risk management, regulatory compliance and corporate governance have become more stringent, and with onerous application, as they remain important variables for assessing the health of Banks, in the drive towards overall sector viability and sustainability.

Imperceptibly, but surely, the regulatory environment of the financial services sector, is also being integrated. The Association of African Central Banks, headquartered in Dakar, brings together 39 regional and country Central Banks in Africa. In line with its statutes, and practices, its Assembly of Governors, usually meets yearly, to deliberate on financial system stability, monetary and payment system integration, the African Central Bank initiative, etc.Another critical arm is the Community of African Banking Supervisors (CABS) which works to strengthen banking regulatory and supervisory frameworks.In the last decade, I have observed, first hand, this increased collaboration between African Central Banks,with MOUs being signed, to facilitate cross border supervision, exchange of ideas and information sharing between host and home regulators. Also, the College of Supervisors set up by the Central Bank of Nigeria, as a forum that brings together host regulators of Banks, with headquarters in Nigeria, but with operations in other jurisdictions,to strengthen governance practices, and ensure soundness in the banking sector, is also a positive development.

An evolving trend in the African banking space, is the initiative to connect Africa, andenablecustomers of a bank to conveniently access their accounts, deposit cash and make cheque withdrawals in any branch, in different countries across Africa, where the bank operates, outside the primary country holding the account. This has the distinct capability to alter the face and operation of banking in the continent as it will open up and facilitate easy movement of goods, services capital, and people. I also look forward to the day, soon enough, for instance, when a Moroccan manufacturer of fertilizer visiting Zambia to negotiate a contract; agrees payment terms, issues a paymentinstrument right away to a Zambian exporter of high quality packaging materials and gets value immediately, using simple electronic payment instruments.

On the whole, these emerging trends contribute significantly to the on-going African-led processes of creating a powerful, vibrant pan-African financial infrastructure, to further undergird and deepen Pan African economic, commercial, business and social interactions through access to personal and business finance across Africa. Together with the various similar initiatives in different spheres by African economic communities identified above, these initiatives will serve as a powerful signal of the march of African economic advancement through financial facilitation to build a fully integrated financial system that enhances financial inclusion, and serves the people.

Work remains. To accelerate financial integration, existing regional mechanisms and frameworks, including those highlighted above, must now begin to coalesce and fuse into larger pan-African systems, Central Banking, common currency, payments and collections; intra-African trade facilitation; etc. In spite of existing differences, but given the importance and fluidity of finance to agriculture, infrastructure, industry and economic development, the largest economies in each region showered as regional anchors, within a defined framework of the Assembly of the African Union.

*Emeka is Executive Director; CEO Africa- Francophone at UBA Group.Piece culled from linkedin page.

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South Africa has granted Grace Mugabe diplomatic immunity: source
August 18, 2017 | 0 Comments

By Ed Cropley*

JOHANNESBURG (Reuters) – South Africa has granted diplomatic immunity to Zimbabwe’s first lady, Grace Mugabe, allowing her to return to Harare and avoid prosecution for the alleged assault of a 20-year-old model, a security source said on Friday.

South African police had put border posts on “red alert” to prevent Mugabe fleeing and indicated she would receive no special treatment in the case involving Gabriella Engels, who says Mugabe whipped her with an electric extension cable.

A security source, however, said immunity had been granted. The source also said Grace Mugabe had failed to turn up at a Johannesburg court hearing on Tuesday, as agreed with police, because of concerns she could be attacked.

The alleged assault — Engels said it occurred on Sunday evening as she waited with two friends in a luxury Johannesburg hotel suite to meet one of Mugabe’s adult sons — is a diplomatic nightmare for South Africa.

The country has a difficult relationship with its northern neighbor. It is home to an estimated three million Zimbabwean exiles who regard President Robert Mugabe as a dictator who has ruined what was once one of Africa’s most promising democracies.

But although he is also widely reviled in the West, Mugabe is still seen by many Africans as the continent’s elder statesman and a hero of its anti-colonial struggles.

A senior government source said on Friday there was “no way” Grace Mugabe, 52, would be arrested because of the diplomatic fallout that would ensue from Zimbabwe.

Indeed, the 93-year old president himself arrived two days early in Pretoria for a regional southern African summit this week to help resolve his wife’s legal problems.

The government source accepted the view widely held by legal experts that Grace Mugabe was not entitled to immunity because she was in South Africa for medical treatment, and said the government was expecting her immunity to be challenged in court.

However, the source said Pretoria justified its decision because of other countries in southern Africa that supported South Africa’s ruling ANC in the long struggle against apartheid would also see Grace Mugabe’s prosecution as a betrayal.

“There would obviously be implications for our relations with Zimbabwe. Sadly the other countries in the region are watching us and how we are going to act,” the source said, asking not to be named.

“What is likely to happen is that she will be allowed to go back home, and then we announce that we’ve granted diplomatic immunity and wait for somebody to challenge us.”

South Africa’s foreign ministry spokesman declined to comment when contacted by Reuters.

“DISGRACE”

Engels’ mother Debbie, who released photographs of her daughter with gashes to her head requiring 14 stitches, said it would be “very sad” if Grace Mugabe was allowed to leave.

However, her daughter’s legal team — which includes Gerrie Nel, the prosecutor who secured a murder conviction against Olympic and Paralympic track star Oscar Pistorius — would counter such a move, she said.

“Gerrie Nel and the team have contingency plans,” she told Reuters, without elaborating. “They will run with it.”

Afriforum, an Afrikaans rights group that Nel joined in January after quitting as a state prosecutor, said it would be illegal for Pretoria to give Mugabe immunity and branded the plans a “disgrace”.

“The government has two responsibilities: one, to protect its own citizens and two, to act according to the law. And the granting of diplomatic immunity would transgress the law,” chief executive Kallie Kriel said.

Harare has made no official comment on the saga and requests for comment from Zimbabwean government officials have gone unanswered. The South African government has restricted all official comment to the police ministry.

The Engels incident is not the first time Grace Mugabe — who is lauded in official Zimbabwean media as “Mother of the Nation” – has been in legal hot water.

In 2009, a newspaper photographer in Hong Kong said Grace and her bodyguard had assaulted him. Police said the incident was reported but no charges were brought.

*Reuters

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— Africa’s richest man, Aliko Dangote, plans to invest $20 billion to $50 billion in the U.S. and Europe by 2025, in industries including renewable energy and petrochemicals.
August 17, 2017 | 0 Comments

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The 60-year-old Nigerian cement tycoon aims to move into these territories for the first time in 2020 after completing almost $5 billion of agricultural projects and an $11 billion oil refinery in his home country, he said in an interview with Bloomberg Markets Magazine this month.

“Beginning in 2020, 60 percent of our future investments will be outside Africa, so we can have a balance,” said Dangote, who’s worth $11.1 billion, according to Bloomberg’s Billionaires Index. Dangote Group will consider investments in Asia and Mexico, but will focus mainly on the U.S. and Europe, he said. “I think renewables is the way to go forward, and the future. We are looking at petrochemicals but can also invest in other companies.” 

Dangote has diversified rapidly in the last five years, both geographically and into new industries. He’s expanded Dangote Cement Plc, which accounts for almost 80 percent of his wealth, into nine African countries aside from Nigeria. In 2015, he began building a 650,000 barrel-a-day refinery near Lagos, Nigeria’s main commercial hub, and he’s constructing gas pipelines to the city from Nigeria’s oil region with U.S. private equity firms Carlyle Group LP and Blackstone Group LP. He said in July he’d invest $4.6 billion in the next three years in sugar, rice and dairy production.

Shares in Dangote Cement rose 2.7 percent to 219.80 naira in Lagos Thursday, extending their advance this year to 26 percent.

Telecoms Unappealing

“When you look at it — not just in Nigeria but in the rest of Africa — the majority of countries here depend on imported food,” he said. “There is no way you can have a population of 320 million in West Africa and no self-sufficiency. So the first thing to do is food security. I believe Dangote Group is in the right position to drive this trajectory.”

Dangote, who mostly lives in Lagos and counts Bill Gates among his friends, said he was a passionate industrialist and ruled out moving into newer sectors such as telecommunications or technology.

“When I look at telecoms, for instance, I think that would be very tough for us,” he said. “Some players have been in this market for 17 years already. There’s no way you can go and jump over somebody after 17 years of their hard work. So I think we would pass when it comes to telecoms today. There are other businesses that we understand better.”

Dangote also said he has no plans to enter Nigerian politics.

*Bloomberg

 

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The Africa Travel Association to host the 41st Annual World Tourism Conference in Rwanda this month
August 17, 2017 | 0 Comments
Washington DC – August 17, 2017: The opportunities tourism brings to African economies will be highlighted when African leaders, international investors, and travel professionals meet for the 41st Annual World Tourism Conference, in Rwanda from August 28 – 31.
Hosted by the Africa Travel Association (ATA), a division of the Corporate Council on Africa (CCA), and the Rwanda Development Board (RDB), the conference will highlight the economic and job opportunities being fuelled by the sector’s continued growth.
In less than 15 years Africa’s travel and hospitality industries have quadrupled in size, and the continent remains one of the world’s fastest-growing tourist destinations, second only to Southeast Asia.
President and CEO of the Corporate Council of Africa, Florizelle Liser, says CCA aims to use the conference to encourage investments and policies that contribute to the sector’s growth.
“The tourism conference will highlight opportunities in the tourism sector and intersecting sectors such as infrastructure, ICT, health, real estate development, and finance. Through strategic partnerships, we will also offer capacity building workshops for travel professionals of all levels,” she said.
Adding: “I look forward to working with [RDB CEO] Ms. Akamanzi and her team at RDB to showcase what Rwanda has to offer.”
This year will be the first time ATA’s Tourism Conference will be hosted in Rwanda, one of East Africa’s premier tourism destinations and one whose sector continues to grow. According to the RDB, Rwanda’s tourism sector generated US$303 million in revenue, in 2014 up three percent in the previous year.
On the sidelines of what is expected to be a packed agenda, ATA is working with Facebook to deliver training to SMEs in Kigali. The ‘Boost Your Business’ is a training initiative, developed by Facebook and facilitated by Digify Africa, designed to train and upskill small business owners on how to leverage digital tools to grow their businesses. The training will be held on August 26 at the Kigali Serena Hotel.
The conference also aligns with Kwita Izina, Rwanda’s annual gorilla naming ceremony, a national celebration creating awareness of the country’s efforts to protect the jewel of Rwanda’s tourism crown: the mountain gorillas and their habit.
The 41st Annual World Tourism Conference will be held in Kigali, Rwanda, on August 28-31, 2017.
Established in 1975, The African Travel Association serves both the public and private sectors of the international travel and tourism industry. ATA membership comprises African governments, their tourism ministers, tourism bureaus and boards, airlines, cruise lines, hotels, resorts, front-line travel sellers and providers, tour operators and travel agents, and affiliate industries. ATA partners with the African Union Commission (AU) to promote the sustainable development of tourism to and across Africa.
Corporate Council on Africa (CCA) is the leading U.S. business association focused solely on connecting U.S. and African business interests. CCA serves as a neutral, trusted intermediary connecting its member firms with the essential government and business leaders they need to do business and succeed in Africa.
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Africa’s Biggest Copper Mine Hit by Zambian Power Restrictions
August 16, 2017 | 0 Comments
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New Angolan beverage plant approved for development
August 16, 2017 | 0 Comments
Grupo Sun Ocean Lda is a project in Angola’s beverage sector with capacity to produce, package and distribute juice, water and wine with significant capacity to contribute to positive economic and social impacts in Angola
LUANDA, Angola, August 15, 2017/ —

  • UTIP investment agreement signed for Grupo Sun Ocean Lda. -a company formed by Sun Ocean Holdings Ltd., a local partner with extensive experience in the Angolan market, Envasadora de Bata S.A. (Embasa) to be financed by QG African Infrastructure 1 LP
  • Grupo Sun Ocean Lda. to benefit from substantial synergies in beverage manufacturing and production and create a base for sustained growth and profitability in Angola and neighboring countries

 

(L-R) Joana Filipe Simplício, Legal Consultant, Silvia Fernandes, Head of department (Chefe de departamento in Portuguese), UTIP, Martin Bachmann, Group Head Active Management, Quantum Global Group

(L-R) Joana Filipe Simplício, Legal Consultant, Silvia Fernandes, Head of department (Chefe de departamento in Portuguese), UTIP, Martin Bachmann, Group Head Active Management, Quantum Global Group

A company (“Grupo Sun Ocean Lda.”) formed by Sun Ocean Holdings Ltd., a local partner with extensive experience in the Angolan market, Embasa (Equatorial Guinea) and QG African Infrastructure 1 LP has received formal approval from UTIP (Technical Unit for Private Investment) in Angola. Grupo Sun Ocean Lda is a project in Angola’s beverage sector with capacity to produce, package and distribute juice, water and wine with significant capacity to contribute to positive economic and social impacts in Angola.

UTIP, whose function is to receive, analyse and manage private investment, took into consideration the socio-economic justification of the project within the Angolan context, in particular, for the beverage sector in the country. In addition, the approval provides a green light for the projects financial model and feasibility assessment.

 

Martin Bachmann, Group Head Active Management, Quantum Global Group (www.QuantumGlobalGroup.com) commented: “I am truly delighted about the creation of this project [Grupo Sun Ocean Lda.] and to receive the approval of UTIP. We thank UTIP’s Board as well as our new partners in Grupo Sun Ocean Lda for their commitment. Quantum Global is excited to be investing in a sector which will contribute greatly to Angola’s drink and beverage sector as well as the diversification of the Angolan economy.”

 

 

Once fully operational, Grupo Sun Ocean Lda. has a target output of over 80 million litres annually and will employ over 400 employees. The company will occupy a unique position in Angola’s drinks and beverage market, in a country that has shown significant progress in increasing wealth, macroeconomic stability and economic diversification in recent years. Working to develop local juice, water and wine production and packaging capacity in Angola, initially serving the Luanda market and other nearby provinces in Angola, Grupo Sun Ocean Lda. is well positioned to contribute to the stability and ongoing development of the country’s drink and beverage sector as well as the significant creation of new jobs and comprehensive supply chains.

 

Grupo Sun Ocean Lda. is a company formed by Sun Ocean Holding Ltd.; a beverage and juice raw materials company, an Angolan company with extensive experience in the local market,  Envasadora de Bata S.A; an Equatorial Guinea holding company in the beverage sector with strong experience in the management of the construction  and operation of beverage production and packaging factories and QG African Infrastructure 1 LP; an investment vehicle managed by Quantum Global with attractive risk diversification across countries, sectors and underlying demand, exploring investment opportunities for early stage, expansion and exit including Greenfield and Brownfield investments.

 

Quantum Global is an international group of companies active in the areas of private equity investments, investment management as well as macroeconomic research and econometric modelling. Quantum Global’s private equity arm manages a family of funds targeting direct investments in Africa in the sectors of Agriculture, Healthcare, Hotels, Infrastructure, Mining and Timber – as well as a sector agnostic Structured Equity fund. Our team combines a solid track record and proven expertise to identify and execute unique investment opportunities with focus on Africa. Quantum Global works in close partnership with key stakeholders to maximise investment value and returns through active management and value creation

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African Regional Center of New Development Bank to be launched next week
August 13, 2017 | 0 Comments
Photo taken on April 20, 2017 shows an aerial view of Johannesburg Town, SouthAfrica. The City of Johannesburg Local Municipality is situated in the northeastern part of South Africa with a population of around 4 million. Being the largest city and economic center of South Africa, it has a reputation for its man-made forest of about 10 million trees. (Xinhua/Zhai Jianlan)

Photo taken on April 20, 2017 shows an aerial view of Johannesburg Town, SouthAfrica. The City of Johannesburg Local Municipality is situated in the northeastern part of South Africa with a population of around 4 million. Being the largest city and economic center of South Africa, it has a reputation for its man-made forest of about 10 million trees. (Xinhua/Zhai Jianlan)

JOHANNESBURG, Aug. 12 (Xinhua) — The African Regional Centre of the New Development Bank (NDB) will be launched by the South African President Jacob Zuma on August 17 in Johannesburg.

This was revealed by the National Treasury in a statement on Friday. The African Regional Center will allow countries in the continent to have access to the bank.

“The launch of the African Regional Center will showcase the NDB’s service offering, highlighting the Bank’s potential role in the area of infrastructure and sustainable development in emerging and developing countries,” said the Treasury in the statement.

The NDB is an institution to solve the infrastructural development and funding problems for BRICS and developing countries particularly in Africa. The BRICS Summit in Brazil signed an agreement to establish the bank in 2014.

“Another key resolution taken at the 2014 Summit was to establish regional offices that would perform the important function of identifying and preparing proposals for viable projects that the bank could fund in the respective regions,” said the treasury.

The NDB headquarters were officially opened in Shanghai, China in February 2016. The NDB is expected to complement the work done by the Breton Woods institutions but not have strings loans like the latter.

*Xinhua/New China

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