Ghana's talented but ignored inventors
August 24, 2014 | 0 Comments
A father and his pilot son in a country with no history of manufacturing are making products that will stun the world. By Kent Mensah* [caption id="attachment_11350" align="alignleft" width="300"] Kantanka brand of SUV that is ready for the market[/caption] Accra, Ghana – Imagine having a television set that comes on after an effortless clap or by blowing air; picture yourself in a car that is engineless and starts with a simple push of a button tucked to your dress; or a change-over-machine that speaks and tells you where exactly a fire or electrical fault is in your home. This is not fiction. It is not magic. It is not happening in Europe or Asia and not even in the United States. These products are being manufactured in the West African nation of Ghana. The brains behind this is Apostle Dr Kwadwo Safo, owner of the Kantanka Group of Companies. He is naturally gifted. A genius. An inventor and a philanthropist. He has no formal or sophisticated technical background. He imagines, dreams and creates at will. He lives in his own world. It takes about 45 minutes from Accra, the capital, to reach his “city” at Gomoa Mpota in the central region of Ghana. It is set apart from the hustle and bustle of cosmopolitan Accra. His flag – blue, red, yellow and white stars embossed on the blue hue – constantly flies at a junction on the highway you reach after going past beautiful green landscapes that lead to his location. It is a large tract of land. The buildings are huge. The ambiance is engaging. It has a natural touch and feel, complete with tortoises – the oldest is 40 years – and a porcupine, evidence of Safo’s love for nature. Engineless car A large African map showing a picture of Apostle Safo spinning a ball imprinted with pictures, a huge star beneath it and a miniature aircraft welcome visitors. It takes close to two-and-a-half hours to tour his complex in a car. His son, Kwadwo Safo Jnr, a commercial pilot who acquired his licence at age 19, welcomed Al Jazeera. He is the group’s chief operations officer. After driving past the tortoises, the first point of call was a workshop where a chopper was being manufactured alongside a hand-made engineless five-seater vehicle. Safo Jnr said they will ensure there is no risk in test-flying the chopper and explained how the engineless car will work. [caption id="attachment_11351" align="alignright" width="300"] A Kantanka brand of SUV that has gone through testing and is ready for the market[/caption] “The non-engine vehicle does not rely on a combustion engine to move, but an electric motor powered by rechargeable batteries,” Safo Jnr told Al Jazeera. “The batteries can be recharged with solar energy or electricity. As you drive the car on the road, it converts the energy from the sun into mechanical energy which powers the car. “We do everything here. For the engineless car it is only the lights and the tyres that were bought. Everything else from moulding [parts], among others, was done by our local people.” A peacock bade us goodbye from that section, then three zebras smiled at us as we drove on an untarred road towards the colossal buildings on the outskirts. They are four in all, neatly painted and look abandoned when viewed from a distance. The structures serve as the assembling plants for the yet-to-be unveiled Kantanka range of commercial vehicles – sports utility vehicles (SUVs) and pickup trucks. Although some car parts are imported, assembling the more than 1,500 pieces for a car and spraying are done by about 20 young men between the ages of 16-25 years. Amazingly, they have no formal training in building a car. “Most of them are junior and senior high school leavers. The people who are actually racking their brains here to make things work have never been to school before,” Safo Jnr said. Six to 10 cars can be assembled and be ready for the road in a day. Four had been completed and tested by the time Al Jazeera visited. It is hard to tell they were actually assembled in Ghana, save for the Kantanka crown and inscription at the back. Market plans “We are hoping to increase the number to 12 or 15 daily when we go commercial soon,” Safo Jnr said. “We have delayed … going commercial because Africans and Ghanaians in general have the perception that once it is from Ghana, it is not good – durability is not assured, safety is not guaranteed. So we have decided to use the products ourselves and make sure they are good to go and standardised before we hit the market. “I was in Brazil about six months ago and I was in tears. The whole of Rio de Janeiro was packed with Marcopolo buses … and these are buses that were assembled and made in Brazil. [caption id="attachment_11352" align="alignleft" width="300"] A finished Kantanka vehicle at the speed testing unit of the manufacturing plant[/caption] “They patronise it. In India they encourage made-in-India vehicles – Mahindra and Picanto, etc – and that’s my dream to one day see Kantanka cars on the streets of Accra, Kumasi and all over. I will be fulfilled,” a visibly euphoric Safo Jnr pointed out in his office fitted with a locally made air-conditioner that is switched on and off by slotting in a card. The card in the air-conditioner, explained Safo Jnr, works like one used for an ATM. It is programmed to start the air-conditioner, regulate the temperature and can tell the time when the unit should be turned off. It is multi-functional, he said. Difficult questions While hugely ambitious and a potential source of pride for a country that is only known for its gold, cocoa and lately oil, the Kantanka project still raises major questions. Who, for example, will buy SUVs in a country where the average income is $1,400 and where just about everyone drives a used car? Do the carmakers perform crash tests, and will they meet the high standards of cars made in Europe and Asia? “We will be doing that in the course of our manufacturing process,” said Safo Jnr, referring to crash tests. The cars will be “affordable” and middle-income earners will be able to buy them. “We know the market and we can assure you that Africans will be able to buy our cars,” he said. In some countries projects such as this attract financial assistance from the government. But Ghanaian governments upon governments seem to have ignored the “Star of Africa”, as Apostle Dr Safo is called by the people of Ghana. Not even his self-made Limousine dubbed “Obrempong”, the speaking change-over-machine, or a range of flat-screen television sets made with wood covers that respond to a simple clap to come alive, increase or reduce volumes have fascinated the government enough to support one of their own. Determined to succeed The Safo family is undaunted though. [caption id="attachment_11354" align="alignright" width="300"] Kwadwo Safo Jnr making a point in an interview with jounalist Kent Mensah[/caption] “Most of the promises they have made, they say they are in the pipelines. I’m sure African pipelines are very choked so the water is not flowing. Not even the corporate world has shown concern … We are still hoping,” said Safo. “We have had several offers from Asia and Europe, but we turn them down because we just want to stay in Africa and make sure that whatever we are doing here we’ll be able to achieve our dreams. “People tell us that we are wasting our time because we won’t get anywhere. But we pay no attention to them, rather we make sure that we prove them wrong by meeting targets that we set for ourselves.” The US-trained young pilot is optimistic about the future. For him, it is a matter of trust and belief in the African. “The whites believed in themselves and got to where they are now. They are no different from us. We all stayed in our mothers’ womb for nine months … If you cut a white and a black man you get blood. The only differences are our names and colours,” he said. “So we should believe in ourselves. We must reduce the talking and put in work.” *Source Al Jazeera .Photos by Kent Mensah]]>
US-Africa Summit: What post agenda for West Africa?
August 24, 2014 | 0 Comments
By Emanuele Santi and Mohamed El Dahshan* [caption id="attachment_11342" align="alignleft" width="275"] President Yaya Boni of Benin and US President Barack Obama at the recent Summit in Washington,DC[/caption] As the largest-ever US-Africa gathering of leaders came to a close, the debate on the future of the US policy for Africa has once again resurfaced. While interesting suggestions are put forward by economists and other experts – this argument by the Center for Global Development on closing the energy gap is among the most interesting – it may however be judicious if, rather than hope for a new grand scheme to be implemented, we take a deeper look at the existing US economic policies and instruments towards Africa, and analyze their effect on the West African region. The flagship economic policy of the US-Africa policy as it stands is the African Growth and Opportunity Act (AGOA), by which the US decided to incentivize African countries to open their markets and partake in global trade, by offering to eliminate import duties on over 6,400 products exported from 38 eligible Sub-Saharan countries, including all 15 West African nations. Indeed, US President Barack Obama had vowed, in a 2013 press conference in Senegal, that the AGOA programme would be “renewed and improved”. The programme indeed stands to be greatly improved. For one, the yearly renewal of AGOA appears to present some difficulties for investors in terms of investment planning and diverting resources to AGOA-compliant exports. As such, a number of African ambassadors to the US drafted a proposal suggesting AGOA be renewed for 15 years. As displayed in the table below, which details the yearly exports from AGOA beneficiary countries to the US over the past 10 years, few countries appear to have benefited from the preferential access, with Nigeria and, to a lesser extent, Côte d’Ivoire, far ahead.
|Oil and Gas||$22,781,896,155||59.80%|
|Primary metal manufacturing||$3,063,465,495||8.00%|
|Petroleum and Coal products||$2,683,498,920||7.00%|
|Miscellaneous manufactured commodities||$1,679,184,263||4.40%|
|Apparel manufacturing products||$921,160,903||2.41%|
Designer shuns medical school to build 'jewelry empire'
August 23, 2014 | 0 Comments
Monique Todd* [caption id="attachment_11305" align="alignleft" width="640"] Janet Fredman Designs is a jewelry retailer specializing in contemporary accessories. Utilizing natural resources such as seeds, wood and leather, Fredman creates unique pieces that encapsulate the raw beauty of Zambia.[/caption] It takes a lot of guts to choose jewelry design over a career in medicine, but then, Janet Fredman isn’t the kind of woman to shy away from challenges. Shunning the prospect of attending medical to follow her creative side, the young entrepreneur went about transforming a passion for handmade accessories into a flourishing design practice based in Zambia’s capital, Lusaka. Despite the country’s rich offering of gold and gemstones, Fredman opted for everyday materials such as wood, seeds and leather to make her pieces. The result is a stunning collection of rings, bracelets and necklaces that translate the beauty of Zambia into wearable art. “[When] I started first making jewelry, it started as a hobby”, recalls Fredman. “I started making jewelry out of beads, and then later went to study as a goldsmith.” She adds, “after studying, I came back and then what I learned as a goldsmith I incorporated it with Zambian materials to make contemporary Zambian jewelry.” A visit to a Cape Town jewelry shop further inspired Fredman to dive headfirst into her new venture, and since January 2014, the business has provided both a rewarding and challenging experience. Still in her 20s, Fredman has impressed many with her success, but establishing a new business at a young age is never easy. “Business has been going OK”, says Fredman. “Sometimes it’s slow and sometimes it’s high — [I’m] still trying to find my way, what to do, the how, the do’s and the don’ts; still trying to figure it out.” [caption id="attachment_11306" align="alignright" width="300"] Fredman hopes her designs will help her business grow into a jewelry empire so that “everyone will be talking about it.”[/caption] Professional and sleek, Janet Fredman Designs has the appearance of a high value retailer — but it’s this very quality that has led some people to question the legitimacy of her work. “They’re like ‘you’re young, did you really make this?’ or ‘maybe you bought and maybe you’re selling'” she says. Nevertheless, Fredman remains unfazed. In fact, the talented designer shows no sign of slowing down. “The hopes for my business is to grow it, so it becomes an empire, a jewelry empire everyone will be talking about.” *Source CNN]]>
'Made in China' Now Being Made in Africa
August 23, 2014 | 0 Comments
By Brendon Hong*
Mozambique sees $30 bln investment for 2018 LNG exports startup
August 23, 2014 | 0 Comments
By Manuel Mucari* More than $30 billion will be invested initially in Mozambique’s natural gas sector to build capacity to produce 20 million tonnes per year of liquefied natural gas (LNG), with the first exports due to start in 2018, the national oil company said. The investments will be made to develop the northern ports of Pemba and Palma, where a giant logistics base and LNG production plants are planned that will use gas produced from offshore fields in the Rovuma Basin being developed by U.S. oil major Anadarko Petroleum Corp and Italy’s Eni. Mozambique is hoping revenues from its large gas deposits and its fledgling coal mining industry will help it emerge from years of poverty and dependence on foreign donors. “In an initial phase, liquefaction units with a total capacity for 20 million tonnes a year of LNG will be built and operated. The investment to be made tops $30 billion,” Nelson Ocuane, president of the state oil company ENH, said. The initial exports from 2018 will come from a first LNG train of 5 million tonnes a year, with overall capacity for the industry to be ramped up subsequently to 20 million tonnes per year. “Mozambique has good conditions to start exporting in 2018 because all the investment plans indicate that the essential infrastructure will be in place by then,” Ocuane said. Some industry analysts say Mozambique may struggle to meet its target date of 2018 for the start of LNG exports. They say it must develop its LNG potential by the end of this decade as other supplies come on the market from West and East Africa and the global supply/demand scenario shifts, with the United States moving from energy importer to exporter. Enough gas to supply 4 countries for 18 years Around 180 trillion cubic feet of gas has been found in Mozambique’s offshore Rovuma Basin. This would be enough to supply Germany, Britain, France and Italy for 18 years. Italy’s Eni has proposed constructing two floating offshore LNG plants to process gas from its Rovuma Basin area, which would be quicker to complete than an onshore facility. Ocuane said Mozambique’s government was giving technical consideration to the Eni proposal, and would give its answer “in due course”. But he added: “The government prefers the construction of LNG units onshore because this has the potential of creating employment and allowing the possibility of a series of investments in support areas for the gas industry.” Under the new legislation for the sector, foreign operators who win licences to explore for oil and gas must do so in partnership with state oil company ENH. The law also says that 25 percent of all gas and oil produced should go to the domestic market. Mozambique recently set up a public company, Portos de Cabo Delgado, bringing together the state rail operator, CFM, and the national oil company to develop the northern LNG infrastructure. The sub-concession for the Pemba port development has been given to ENHILS (ENH Integrated Logistics Services), a joint venture between ENH subsidiary ENH Logistics, which holds 51 percent, and Orlean Invest, a Nigerian company, with 49 percent. *Source Africa Report/Reuters]]>
The Needs of African Nations Align well with technology deployed by Vermeer-CEO Mary Andringa
August 21, 2014 | 5 Comments
Vermeer CEO Mary Andringa with Minister of Foreigh Affairs and International Cooperation of Somalia, Mr. Abdirahman Dualeh Belleh at the recent USA-Africa Leaders Summit[/caption] It is a good time for more trade engagement with Africa says Mary Andringa CEO of Vermeer a global leader in the provision of agricultural and industrial equipment. Currently in South Africa ,parts of North Africa,Nigeria and the D.R.Congo, the needs of African Nations align well with technology that Vermeer deploys around the world ,Mary Andringa said. The CEO of Vermeer was one of the active participants at the USA-Africa’s leaders forum as the company seeks to expand its operations and networks in Africa. With growing emphasis on agriculture,energy and infrastructure across the continent, Vermeer is one of the American Companies which could find a lot of willing partners . What Vermeer is looking for are the right people with the interest in learning the technical side of equipment solutions and providing customers with premium services when it comes to parts,services and technical knowledge,Mary Andinga said. In a show of confidence against competition , Mary Andringa said the level of support differentiates Vermeer from others as her Corporation does not just sell equipment and leave but also places much emphasis on the productivity and profit of customers. In technology and support, Vermeer has what it takes to compete and do better than some of the Chinese companies she said. Your company was actively present at the recent USA-Africa Leaders Summit, what impressions did you leave the summit with? It is a good time to become more engaged with trade for Africa. With the emphasis in Africa on power and communications, clean water, etc. the needs of many African nations align well with the technologies we have been deploying around the world. In what parts of Africa is Vermeer presently doing business in and how has the experience been so far? We are doing a lot of work in S. Africa and parts of Sub Saharan Africa. The experience has been good. We work through focused Vermeer dealers. Our dealer in S. Africa has been excellent in supporting customers. We have worked in Northern Africa on some project deals. We are also involved in surface mining in the DRC. What exactly has been holding back your company and in a broader sense American companies from investing in Africa? Finding the right people to represent Vermeer who are willing to learn about the technical side of our equipment solutions and understand the expectations for taking care of customers with parts, service and technical knowledge. We also need people we can trust and who are ethical in their work practices. The massive presence of African Leaders was probably an indication of willingness to do business with the USA; did you leave with the conviction that some of the issues which have discouraged companies like Vermeer from investing in Africa will be addressed? I was much more confident that issues of transparency and working in an ethical manner are priorities for African governmental leaders and leaders of businesses. The growth of American business in Africa comes at a time when countries like China are all over the place, what strategy does Vermeer have make inroads in the African market in the face of competition? We focus on trying to make a real impact on our customers’ productivity and profit. Therefore we are not just selling equipment and then leaving with no followup. We want our customers to be very successful in using our solutions. Therefore our level of support really differentiates us. I believe with our technology which helps improve infrastructure, and manage natural resources we have some great solutions for the variety of infrastructure projects going on in Africa. And our technology and support can help us compete against Chinese and other competitors. As a follow up to that if you were asked to articulate the case on why Africans should opt for business with American companies, how will you sum it up? As a US company, I would ask African companies to look at who can give them the most value. They need to consider not only the initial purchase price of solutions, but how are they going to be supported in their work. A major concern has been a lot of the companies which come are all about profit, with little care to communities or social initiatives, what does Vermeer has as a policy to help worthy development causes in the community besides business? Our history in the US has been one where we have given back to our communities for over 6 decades. As we do work internationally where we have entities, our team members have given of their time to be involved in various community projects—like volunteering time in orphanages, raising money for good causes, etc. But as important is helping our customers be productive and profitable so they gain more work and provide good jobs for local citizens. In Africa our dealership has aided in several projects where a compressed earth block machine (with ties to Vermeer) has been used to build structures for not of profit organizations. May we have an idea on the post summit plans of Vermeer for its investments in Africa, how soon before we see the next steps in your company’s expansion to Africa? We are intent to continue on working on a plan which we started a year ago. We have added a person from our European office to focus totally on new markets in Africa. He has conducted several educational seminars in Ghana on using trenchless technology to install electrical lines or fiber without cutting streets and disrupting traffic. We will continue to focus on this type of education and connection where there are power or fiber projects. We are also hoping to be more intentional about involvement in MCC projects in Africa. A last question, how does the USA strike a balance between corporate interests in Africa and values like democracy, good governance and democracy? We are just getting to know the MCC organization, but their filter for where money is invested may be the model for how the US strikes that balance—looking for democracy, good governance and supportive local government and private enterprises. For more on Vermeer and its products click here]]>
Gearing up for the grand finale of AfDB’s 50th Anniversary
August 21, 2014 | 0 Comments
The African Development Bank (AfDB) marks its Golden Jubilee this year. The grand finale of the year-long celebrations is scheduled to take place November 4, 2014 in Abidjan, Côte d’Ivoire.
Zimbabwe’s Econet Wireless and the making of Africa’s first cashless society
August 21, 2014 | 0 Comments
Anna Leach* [caption id="attachment_11214" align="alignleft" width="460"] Strive Masiyiwa, CEO of Econet Wireless. Photograph: Sarah Lee for the Guardian[/caption] Will Zimbabwe be Africa’s first cashless society? Telecommunications company, and now mobile banking service, Econet Wireless predicts that in less than 12 months notes and coins will be long-gone from this southern African country. “We do not expect anyone to still be using paper money in a year’s time,” the company’s CEO Douglas Mboweni recently said. “It will be just like Europe or America, where you no longer see people carrying bundles of cash.” The collapse of Zimbabwe’s economy in 2002 paved the way for Econet Wireless’s mobile payment system. “Hyperinflation had destroyed people’s confidence in financial institutions,” said the Zimbabwe company’s founder, Strive Masiyiwa, at the Mastercard Foundation Symposium on Financial Inclusion in July. “The lowest denomination circulating was $1,” Masiyiwa said. “If you want to buy a packet of sweets for your child, you can’t get change.” The company set up a mobile payment system that handles small amounts and allows people to save as little as $1. “Today 43% of the GDP moves through Econet Wireless,” he concludes. Masiyiwa was born in Zimbabawe (then Rhodesia) in 1961. He and his parents fled the country in the turmoil after prime minister Ian Smith declared independence in 1965, settling in Zambia. His parents, who ran their own business, could afford to send Masiyiwa to school in Scotland when he was 12. After school he studied electronic engineering at the University of Wales and worked briefly for a computer company in Cambridge before returning to Zimbabwe in the early 1980s. Econet Wireless was established in 1998, but not before a fight. Masiyiwa waged a five-year legal battle with the government for a licence to deliver telephone services. The company now operates in 17 countries including Botswana, Lesotho, Kenya, Nigeria, South Africa and New Zealand. In 2000, while the UN filed a civil suit against Mugabe, Masiyiwa moved his family and company headquarters to South Africa. Econet Wireless first developed mobile payments to help NGOs transfer money to refugees after the war in Burundi ended in 2005. “Donor agencies were trying to find ways to make cash disbursements to refugees,” says Masiyiwa. “So we built the payment system initially not as a business but as a way to help humanitarians get money to people in rural areas who were trying to re-establish their lives.” That model was extended and now mobile money transfers are central to Econet Wireless’s business. Like M-Pesa before it, the company blurs the lines between telecomms and banking. Masiyiwa is passionate about this latter part of his business. He believes that extending saving and credit services to the poorest people gives them “extraordinary dignity and a sense that they are in control of their own lives”. His next challenge is to create a product that allows people who are informally employed, such as smallholder farmers and casual workers, to access credit. “In Africa 70% of people are informally employed,” he says. “The big frontier for us is to create platforms where those people can access credit.” He says there’s no risk that they will get into unmanageable debt because the banks won’t extend excessive credit, calling the system “self-regulating”. But Masiyiwa says that offering people the ability to save is even more important than credit. “We’re trying to build up a savings culture where people are encouraged to save, even if they only have a dollar – for children’s school fees, for transport, for the doctor. A savings and credit infrastructure builds resilience.” In his speech to microfinance experts at the symposium in Turin, Masiyiwa recounted a story about the judge in Zimbabwe who granted Econet Wireless’s licence in 1998, saying that 70% of people in the country had never heard a telephone ring. “Today, 75% of people [in Zimbabwe] have a cell phone,” he said “And I want 75% of the people in Africa to have a bank account … on a mobile phone.” And Masiyiwa has even found a solution to the energy problem that could prevent him from realising his dream. “We have developed solar charging stations where people can go into a kiosk and plug in their phone for free. Because our money is not made from someone charging the phone. It’s made from someone using the phone.” By way of lessons learnt, Masiyiwa says that in order to reach the unbanked, financial institutions – and telecommunications companies – must design services that are practical, simple and affordable. “I’ve got a customer who has a dollar in his pocket and has got to decide to have some lunch, call his cousin or go to the doctor. We have to develop services with sensitivity to the fact that in Africa our customers don’t have the same disposable income as in New Zealand, for example.” But the billionaire businessman cautions that it’s a mistake assume the poorest behave differently to other customers. “Their behaviour and aspirations are no different from those who have higher incomes,” he says. “They want to use Facebook. They want to use WhatsApp. We have to find ways for them to access those things with their very low income.” *Source Guardian]]>
US-Africa Leaders Summit: Africapitalism at Full Speed
August 16, 2014 | 0 Comments
Indeed, the summit turned the page on a post-cold war type of diplomacy which had been dominated by derogative aid and a paternalistic approach. The summit helped to usher the two continents toward stronger economic cooperation and also created a platform fora win-win, mutually beneficial partnership aimed at reducing security threats.
The official agenda was focused on security, democracy and governance. However, for the first time, a trade and investment- focused theme dominated the week, with more than 60 ancillary events featuring African leaders who shared information on business opportunities in their respective countries.
As a result of these conversations, US President Barack Obama announced a $26 billion commitment to power development on the African continent to provide electricity to more than 60,000 Africans and entrepreneurs and to lay the foundation for an African economic boom. A total of $33 billion was pledged and $14 billion worth of private deals were created during the summit.
These investments are a far cry from China’s $200 billion investment in the African continent in 2013 which is more than double that of the United States. In fact, US Ambassador Linda Thomas-Greenfield said that Africa presents enough opportunities to be seized by all players. China and the US have two different approaches to investing in Africa but they are complementary. Still, Africa’s bright future will not depend on the amount of investments made; it will depend on which investments have the ability to create jobs on the continent and secure long-term development.
African leaders came to Washington accompanied by more than 200 African executives. Mutually beneficial partnerships are now the new models of engagement such as the partnership between Dangote Industries, asset management firm Blackstoneand Black and Black Rhino, an African infrastructure development company, with a $5 billion investment in infrastructure development. Another partnership includes Heirs Holding, Symbion and General Electric. It’s a venture that contributed to tripling the power capability in Nigeria from 150 megawatts to 453 megawatts in just six months. These success stories were made possible by the strong implementation of local content laws in Nigeria which allows their private sector to grow and due to improved power and investment regulations.
Leaders called for the creation of jobs on both sides of the Atlantic, in order to address the US employment challenge and Africa’s security threat posed by 54 million new jobs that need to be created in Africa by 2020. This can be duplicated in all sectors. This is Africapitalism at full speed.
Nevertheless, Africa’s future still depends on Africans, not on China, the European Union or even the United States. While speaking at the Believe in Africa Day High-Level Dialogue organized by African diaspora leaders, President of the African Development Bank M. Donald Kaberuka said: “A country that relies on others to finance development is ordained to fail.”
African leaders had expected to participate in the usual bilateral talks that they have attended summits held in France, the European Union and China. However, the lack of such talks did not undermine the outcome of the US-Africa Leaders Summit. Their participation in the summit sent a clear message to the rest of the world that Africa is ready to enter the big leagues and that the US summit was not just held to compete with the ones held by the Chinese or French.It is rather a loud proclamation of the strategic and economic importance the continent holds as stated in a resolution introduced by US Representative Gregory Meeks in the US Congress.
Nonetheless, the US still needs to contend with China, Europe and other emerging economies, including India and Turkey. The increase of positive south-south relations has already altered the traditional regional landscape.We are entering a new era for US-Africa relations. President Obama deserves an accolade for igniting the spark for these new relations. It is our hope that other summits will take place, and hopefully the next time it will be on African soil.
* Souce US-China Daily
Walmart Sets Its Sights on Africa—With Uncle Sam's Help
August 9, 2014 | 0 Comments
Bill Clinton shakes hands with US and African business leaders at the African Business Forum in Washington, DC. Doug McMillon, CEO of Walmart, is on the far right. Jacquelyn Martin/AP[/caption] On Tuesday, the second day of this week’s three-day US-Africa Leaders Summit, Walmart CEO Doug McMillon shared the main stage with the CEOs of General Electric and Dow Chemical. Sitting on a panel moderated by Bill Clinton, he talked about how his company was working with farmers to grow food to sell in its stores, and even export back to the United States and United Kingdom. “As we look at what we’re trying to do in Africa, we are simply trying to provide customers access to fresh produce and other items at a great value,” McMillon said. “To do that, we got to have a great supply chain.” Yet Walmart isn’t building that supply chain alone—it’s getting a boost from the US government. At the close of the summit—which saw more than 50 African heads of state and government and 100-plus US and African businesses (and more than a few of their lobbyists) pack into a Washington, DC, hotel to plan the future of US-Africa relations—Walmart vice president Maggie Sans announced that the company and its foundation had pledged $3 million to train 135,000 farmers in Kenya, Rwanda, and Zambia, including 80,000 women. The funds will expand existing projects organized by the US Agency for International Development (USAID), the consultancy Agribusiness Systems International, and the nonprofit organizations Global Communities and the One Acre Fund to develop farm-to-market supply chains. Under the program, Kenyan farmers can expect to see their incomes double in a single growing season, Sans said. Walmart and USAID have worked together before. Beginning in 2007, the agency partnered with Walmart, TransFair (an independent certifier of fair-trade imports), and SEBRAE (a Brazilian nonprofit) to train 5,000 farmers in Brazil to improve the quality of their coffee crop to sell at Walmart stores. In 2011, USAIDjoined with a Guatemalan nonprofit and Walmart’s Mexican and Central American arm to connect farmers benefiting from a USAID program to boost production to the company’s supply chain. The agency helped train small farmers in Honduras and Guatemala to grow potatoes and onions that fit Walmart’s specifications, and Walmart provided a place to sell them. Produce is the central component of Walmart’s expansion into Africa, which began in 2011, when Walmart bought a majority share of the South African-based Massmart chain for $2.4 billion. At the time, Massmart had almost 300 stores in 14 African countries, according to Bloomberg. By August 2013, Massmart had almost 360 African stores, and Walmart announced plans to build 90 more, with a “focus on fresh food,” according to the Wall Street Journal. Three weeks later, Walmart, the Walmart Foundation, and USAID signed a memorandum of understanding with the aim of forming a voluntary partnership between the parties, focusing on climate change, farmer training, and agriculture, among other priorities. USAID administrator Rajiv Shah acknowledged in a 2012 interview with Foreign Policy that working with Walmart was necessary, even if the choice wasn’t universally embraced. “Over the last several decades, it’s been controversial to have companies like Walmart in the development solution,” he said. “I think it is the kind of long-term development program that is needed to succeed at scale over time.” [caption id="attachment_10940" align="alignright" width="300"] A Marko store in Johannesburg, South Africa, part of the Massmart brand, which was purchased by Walmart in 2011 Themba Hadebe/AP[/caption] Shah went further at a speech at the University of Arkansas, shortly after signing the memorandum at Walmart’s headquarters in Bentonville: “We want to bring Walmart’s core capabilities in philanthropy and business to every part of the world to transform the face of hunger and poverty,” he said. “To end poverty, childhood deaths, and hunger, we need to bring together businesses with supply chains for partnership to reach the farthest corners of the globe.” While supermarket chains in Africa may benefit the farmers who supply them, not everyone is convinced that expanding their customer base will end hunger. In 2013, World Bank researchers found that the richest fifth of the population of Zambia accounted for two-thirds of all the country’s supermarket sales; the bottom 60 percent accounted for only 12 percent. A year earlier, geographers Bill Moseley, Stephen Peyton, and Jane Battersby compiled a database of supermarkets and population distribution in the Cape Town, South Africa, area that showed that supermarket density was 16 times higher in upper-middle-income neighborhoods than in the poorest areas. Despite the disparity, poor and urban residents interviewed for the study said they preferred to shop at supermarkets when they could since they stocked higher-quality food. The problem was that the poorest customers had irregular incomes and often lacked refrigerators at home, meaning they could only purchase food in small quantities, which is easier at local shops than at supermarkets selling bulk and packaged goods. “Supermarket expansion is neither a solution to, nor a curse on, hunger alleviation efforts in urban South Africa and the region more broadly,” the researchers wrote in an Al Jazeera op-ed. “This market-oriented solution to improving urban food access is inherently limited because it just cannot meet the needs of the poorest of the poor.” Whoever its future customers will be in Africa, Walmart says it’s ready to meet them. “Everywhere we operate, we find our customers have so much in common,” McMillon said. “Our customers in Africa want to spend less on everyday needs so they can provide more for their families. We want to help.” *Source motherjones]]>
Kenya downplays security risks as it courts U.S. investment
August 9, 2014 | 0 Comments
[caption id="attachment_10911" align="alignleft" width="300"] Kenya’s President Uhuru Kenyatta listens to opening remarks at the start of the U.S.-Africa Leaders Summit Session One on ‘Investing in Africa’s Future’, at the U.S. State Department in Washington August 6, 2014. Also pictured is Guinea-Bissau’s President Jose Mario Vaz (R).
CREDIT: REUTERS/JONATHAN ERNST L[/caption] Kenyan President Uhuru Kenyatta, in Washington this week to court Western investors, has sought to downplay a spate of violent attacks tied to militants in neighboring Somalia and their impact on Kenya’s economy. “Yes, we may have pockets where we have problems – which we know and are focused on how to address. But the rest of the country is actually trouble-free,” Kenyatta told Reuters in an interview on Thursday from a hotel overlooking the White House. Kenyatta, the son of Kenya’s founder who was elected last March to lead East Africa’s biggest economy, has been touting the country as a resource-rich hub of innovation, talking up the benefits of East African integration and detailing vast plans to improve the country’s shaky infrastructure. But he has also been plagued by questions about security. Last September, Somali-linked Islamist militants attacked Nairobi’s Westgate mall and left at least 67 people dead. This summer has seen a spate of killings, mostly along Kenya’s coast, prompting several Western nations to warn their citizens against travel to parts of Kenya. In June, after two attacks left 65 people dead on the coast, Kenyatta dismissed claims of responsibility by the al Shabaab militant group, instead pointing the finger at rivals he described as “hate-mongers,” though he did not name anybody. “Look, we know that al Shabaab played a part,” Kenyatta said on Thursday. But he again suggested that “local networks” in Kenya were also involved in an effort “to help achieve a petty political agenda.” Al Shabaab has said its attacks are intended to punish Kenya for sending troops to Somalia to confront its Islamist fighters. Kenyatta has repeatedly said he had no intention of removing Kenyan troops from Somalia, saying that would only be done when Kenya’s neighbor to the north, which has been without a functioning government for more than two decades, is stable and can secure its borders. Kenyatta has mostly kept a low-key profile at this week’s U.S.-Africa Business Forum, a three-day summit meant to showcase U.S. interest in improving trade and investment on the continent. But he said he believed the gathering had helped make American businesses aware of opportunities in Africa. Although Kenyatta said he hoped to attract investors in the power, resource extraction and technology sectors, he said Kenya was meanwhile working to make the country more hospitable to business, in part by making it easier to move goods. Asked to name his top three infrastructure priorities, Kenyatta said he aimed to double the country’s road network, expand its rail sector and complete a second container terminal at the Indian Ocean port of Mombasa – the biggest in east Africa and the region’s trade gateway. Kenyatta added he would like to see completion of a second port in Lamu, north of Mombasa – part of a $25.5 billion regional infrastructure project aiming to link landlocked east African nations to the sea – as well as a new passenger airline terminal in Nairobi. “It may not be complete within five years,” Kenyatta said of the five projects, “but if Kenyans give me an opportunity for a second term they should be complete by the end of my second term.” *Source Reuters ]]>
Africa offers US firms a compelling trade and investment opportunity – Standard Bank
August 4, 2014 | 1 Comments
Mr Sim Tshabalala, Chief Executive of Standard Bank Group, Africa’s largest bank by assets and market valuation[/caption] Africa offers US multinationals a compelling trade and investment opportunity thanks to the rapid economic growth rates being experienced across the continent along with burgeoning population growth and increasing urbanisation, according to Standard Bank Economic growth in sub-Saharan Africa has exceeded 5% a year for more than a decade now giving the continent a 4.1% share of global gross domestic product (GDP), up from 3.4% in 2000. By 2050 one in four of the world’s population will reside in Africa with at least 60% of the continent’s people living in urban centres. “Trade with African economies and investment in Africa offer big rewards but it requires sound local knowledge, strong local partnerships, and a long term view,” said Mr Sim Tshabalala, Chief Executive of Standard Bank Group, Africa’s largest bank by assets and market valuation. “In that sense the US plan to revitalise its commercial and trade links with Africa couldn’t come at a more opportune time.” The renewed US interest in Africa is embodied by President Barack Obama’s Power Africa Initiative which was launched last year and aims to double access to power in six partner countries in sub Saharan Africa: Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania. The US government has committed more than $7 billion in financial support and loan guarantees to the project over the next five years. That commitment has been doubled by the almost 30 private sector partners who have pledged $14.7 billion in project finance through direct loans, guarantee facilities, and equity investments for Power Africa. Nevertheless, the US still has some catching up to do. While the US is a major investor in Africa – particularly in information technology, manufacturing, resources, power, and financial services – trade flows have advanced on a much gentler trajectory. Although US-Africa trade doubled from about $50bn in the early 2000s to $110bn in 2013 it still lags China whose trade with Africa exceeded $200 billion last year. Yet it is precisely China’s emergence as Africa’s largest trading partner which underscores the potential value on the continent for US firms. Foreign direct investment into Africa has increased dramatically in the last decade and a half, and continues to grow. In 2013, FDI to Africa increased by 9.6% to an estimated $56.6 billion, representing 5.7% of global FDI. FDI is forecast to exceed $60 billion in 2014. Total foreign inflows to the continent reached $186 billion in 2013, and are expected to top $200 billion in 2014. Emerging economies – and the BRICS in particular – are seizing the African opportunity. In 1992 China, India and Brazil accounted for just 3% of Africa’s global trade compared to 25% today. A wide range of firms from India, Brazil and South Africa are also expanding quickly in Africa, often with strong support from their governments. Yet, while the US may be arriving late to this party, the world’s biggest economy still offers unrivalled commercial and industrial excellence in many key fields. The vibrancy of US multinationals, with their proven track records, industrial processes, established retail networks and brands, are of immense attraction to the ongoing consumer revolution taking place across Africa. US firms are also increasingly interested in the commercial opportunities in Africa. Major private equity firms, including the Carlyle Group, have launched Africa-focused funds valued in the hundreds of millions. Leading US technology companies are investing in new ventures and start-ups across the continent. IBM has invested at least $100 million, with new Innovation Centres in Lagos and Casablanca. Microsoft and Intel Capital are embarking on partnerships with African tech companies, and Google is working on delivering broadband to remote communities. “Africa has come a very long way from its era of aid-dependence,” said Mr Tshabalala. “The rapidly emerging middle class in Africa is driving large-scale diversification of Africa’s economies which offers immense opportunities for companies willing to invest.” In Nigeria the middle class has swelled by 600% since 2000. Today, Nigeria is home to 4.1 million middle-class households, containing 11% of the total population. Other economies doing particularly well on this measure include Angola, where 21% of households are considered middle class followed by Sudan (14%) and Zambia (10%). The number of mobile phone users in Africa has multiplied 33 times since 2000 and in the next five years it is likely that almost every adult African will have a mobile phone. Over 50% of urban Africans are already online, a figure that is likely to grow rapidly over the next decade. “While there is still a lot to be done the overall direction that Africa is moving in is overwhelmingly positive,” said Mr Tshabalala. “US companies can do very well in Africa provided they put in the effort to understand the continent’s markets in detail, rather than looking at the continent as a single, homogenous entity.”]]>