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:
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.
Integrating Financial Services In Africa
August 18, 2017 | 0 Comments
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.
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.
Uganda receives one million South Sudan refugees
August 18, 2017 | 0 Comments
The number of refugees fleeing violence in South Sudan to Uganda has passed the one million mark, the UN says.
The organisation is appealing to the international community for “urgent additional support”.
It adds that at least another one million refugees have fled to Sudan, Ethiopia, Kenya, Democratic Republic of the Congo and Central African Republic.
South Sudan has been wracked by civil war, which has seen numerous atrocities, since 2013.
In July of that year, President Salva Kiir fired his deputy Riek Machar, and in December accused him of planning a coup – an allegation he denied. Forces loyal to the two men then started fighting.
Uganda’s welcoming attitude towards refugees has been praised by the UN and other international organisations. The government, for example, gives South Sudanese a plot of land to build a home and farm.
In 2016, Uganda received more refugees than any other country in the world.
The Africa Travel Association to host the 41st Annual World Tourism Conference in Rwanda this month
August 17, 2017 | 0 Comments
How AfDB’s investments in youth raise hope for a new Africa
August 13, 2017 | 0 Comments
“The future of Africa’s youth does not lie in migration to Europe; it should not be at the bottom of the Mediterranean; it lies in a prosperous Africa. We must create greater economic opportunities for our youth right at home in Africa.” – Akinwumi Adesina to G7 leaders
Sixty per cent of unemployed people are young women and men. Of the young people who are employed, many are trapped in low-productivity work in the informal sector. Providing young African people with the education, skills and capacities for gainful employment is considered an urgent priority.
Thanks to the African Development Bank (AfDB), a new crop of highly inspired young Africans are gradually emerging. AfDB’s initiatives in this area are seen as model of how the continent’s young population could become a development asset for a new Africa.
To enable them contribute to the economy and to achieve an improved quality of life, a growing number of youths are embracing small, medium and large agriculture-based industries nudged on by the AfDB.
They are taking hold of their destiny. They can be also found in education, health, ICT and other facets of entrepreneurship.
Indeed, latest statistics reveal that many young Africans are not only exploring their inner potential, they are taking advantage of innovation platforms, inspired by the African Development Bank.
Through initiatives like the Jobs for Youth in Africa (JfYA), Empowering Novel Agri-Business-Led Employment (ENABLE) Youth, and the African Youth Agripreneurs Forum (AYAF), the AfDB is equipping young people with the right skills for business and employment. AfDB has also strengthened its support for science, technology and innovation training by investing in centres of excellence, working in collaboration with the private sector.
With 200 million Africans recorded to be between the ages of 15 and 29, youth unemployment and underemployment are high. Investing in skills through technical and vocational education will be essential to enabling young people to find jobs and business opportunities.
“We will keep Africa’s youth in Africa by expanding economic opportunities. This will help Africa to turn its demographic asset into an economic dividend,” Akinwumi Adesina, President of the African Development Bank Group, said.
At the African Union Summit in January, the African Union (AU) adopted the theme for 2017 as “Harnessing the Demographic Dividend through Investments in Youth.”
AU Heads of States and Governments recognized a country-level demographic dividend as central to the continent’s economic transformation in the context of AU Agenda 2063 – its global strategy for socioeconomic transformation within the next 50 years.
Given Africa’s current demographic structure with a high youthful population, the regional body sees a substantial potential for economic transformation.
According to the AU Roadmap on Harnessing the Demographic Dividend through Investments in Youth, “Africa is on the march towards a more prosperous future in which all its citizens, young, old, male, female, rural, urban, of all creeds and backgrounds are empowered to realize their full potential, live with satisfaction and pride about their continent.”
AfDB is showing that this is doable and is already leading the way.
For instance, through its Jobs for Youth in Africa initiative, AfDB has taken a comprehensive and integrated approach to equipping young people for work and enterprise.
Over the next decade, Jobs for Youth in Africa projects to generate 25 million jobs and impact 50 million youths.
In the agriculture sector, the AfDB is focusing on Empowering Novel Agri-Business-Led Employment (ENABLE) Youth programs, developing small and medium enterprises and creating jobs in agriculture. ENABLE Youth is a programme for young African people (18-35 years old) wanting to start a business in the agricultural sector. It works to promote, enhance, and modernize agricultural entrepreneurship in Africa.
The stories from the ENABLE Youth participants are resounding.
In Uganda (the second largest producer of bananas in the world), Sam Turyatunga saw an opportunity in producing his own brand of banana juice. As a college student, Sam produced the juice in his own dormitory. Supported by AfDB, Turyatunga now produces 1,500 litres of banana juice daily and sells its product in three other countries in East Africa. His firm also supports 500 banana farmers.
At the African University of Science and Technology in Abuja, Nigeria, young scientists and researchers are being trained to enhance industrial innovation, competitiveness and sustainable development across the continent.
“We are integrating a youth employment component into new Bank projects, and are working closely with regional member countries to develop policies that promote youth employment,” said Adesina.
The Bank believes that harnessing the labour, energy and enterprise of young women and men is critical to driving economic growth and reducing poverty.
In line with its Jobs for Youth in Africa Strategy, the Bank is integrating a youth employment component into the design of every operation it undertakes.
The Bank is assisting its regional member countries to develop national youth employment policies, supporting innovative work on best practices to help young people become entrepreneurs, and making investments that catalyze the private sector to increase employment opportunities.
There is a consensus that the 2017 theme on Harnessing the Demographic Dividend through Investments in Youth, has the potential to have far-reaching implications that would address all the key issues that Governments have had to contend with, and change the development trajectory of Africa.
“We must create wealth and restore happiness to our nation. We can only do this when we have an educated and skilled population that is capable of competing in the global economy. We must expand our horizons and embrace science and technology as critical tools for our development,” said Nana Akufo-Addo, President of Ghana.
“The good economic prospects of our country must first profit our youth, because they are our greatest strength and our greatest wealth,” said Alassane Ouattara, President of Côte d’Ivoire.
AfDB’s leadership in this area is considered a viable example, which countries can tap into.
Sudan invited to U.S.-Egyptian military exercises – ministry
August 12, 2017 | 0 Comments
KHARTOUM (Reuters) – Sudan has received an invitation to U.S.-Egyptian military training exercises in October, a first for the country in nearly three decades, its Defence Ministry said.
The head of the Sudanese army, General Emad al-Din Adawi, announced the invitation for the joint Bright Star exercises in Egypt, the largest of their kind in the region, after meeting this week with a U.S. State Department official, it said.
The meeting “opened the door to more dialogue” that could restore U.S.-Sudanese military relations “to their right path”, the army chief said.
In July, the United States postponed for three months a decision on whether to permanently lift sanctions on Sudan over its human rights record and other issues.
Former U.S. President Barack Obama temporarily lifted 20-year-old sanctions for six months in January, suspending a trade embargo, unfreezing assets and removing financial sanctions.
But it said Sudan had to make progress on issues, including internal conflicts, before it would lift them permanently.
Sanctions relief would not change Sudan’s designation by the United States as a state sponsor of terrorism.
Sudan’s economy has deteriorated since the south seceded in 2011, taking with it three-quarters of the country’s oil output, its main source of foreign currency and government income.
Africa: A.P. Moller Holding launches new infrastructure fund with a focus on Africa
August 12, 2017 | 0 Comments
|The new fund will focus on investments in infrastructure in Africa to support sustainable economic growth in the region while delivering an attractive return to its investors|
|COPENHAGEN, Denmark, August 10, 2017/ — A.P. Moller Holding (www.APMoller.com) has together with PKA, PensionDanmark and Lægernes Pension launched a new infrastructure fund with a focus on Africa. The fund has received commitments of USD 550 million from anchor investors.
The new fund will focus on investments in infrastructure in Africa to support sustainable economic growth in the region while delivering an attractive return to its investors.
The fund will be managed by A.P. Moller Capital, which is an affiliate of A.P. Moller Holding, and consists of a team lead by four partners, Kim Fejfer, Lars Reno Jakobsen, Jens Thomassen and Joe Nicklaus Nielsen. The partners all have extensive industrial and investment experience combined with a substantial network in Africa.
“We are very pleased with the significant support from the Danish pension funds and A.P. Moller Holding. Together, we will build and operate infrastructure business in Africa to support sustainable development and improvements in living standards across the continent. We will combine the best from industry in terms of project management and operational capabilities with the best from private equity in terms of agility and focus,” says Kim Fejfer, Managing Partner and CEO of A.P. Moller Capital.
“A.P. Moller Holding was established to build value creating businesses that have a positive impact on society. Africa, with a working-age population likely to reach more than one billion people in the next decades, has a pressing requirement for more investments in infrastructure. In this respect, we are delighted to have established a new promising company in our portfolio with a strong team, who hold the right capabilities and experience to manage infrastructure investments in emerging markets,” says Robert Mærsk Uggla, CEO of A.P. Moller Holding.
The fund has a duration of 10 years and has an initial target of 10 to 15 investments in total.
Peter Damgaard Jensen, CEO at PKA: “PKA has for many years invested in infrastructure both in Denmark and abroad. We have positive experiences investing in Africa and we have for a long time wanted to invest more on the continent. With this new fund we will be making infrastructure investments in Africa and get the opportunity to provide a good return to the pension savers and at the same time make a positive difference in line with the UN Sustainable Development Goals”.
Torben Möger Pedersen, CEO PensionDanmark: “We are delighted to be among the seed investors in Africa Infrastructure Fund I. We see this as a unique opportunity to invest in a region with high economic growth and attractive investment opportunities alongside a partner, A. P. Moller Capital, that has extensive investment experience combined with a strong network and a promising pipeline of potential investment projects. The fund is a good example of how private capital can be mobilized on large scale to implement the UN’s Sustainable Development Goals”.
Chresten Dengsøe, CEO at Lægernes Pension: “Lægernes Pension are delighted to invest in the development of sustainable infrastructure in Africa together with similar-minded Danish pension funds. The team has many years of experience and a proven track record in the region and we expect them to provide attractive investment opportunities going forward”.
Following first commitments, the fund will be open for additional institutional investors for the next 12 months. The ambition is to raise USD 1bn in commitments.
AFRICA’S SKYROCKETING UNEMPLOYMENT: WHO IS TO BLAME, THE UNIVERSITIES OR THE STATES?
August 12, 2017 | 0 Comments
By Moses Hategeka
A few years back, I wrote an article titled, “Universities/Varsity Curricula Must be Practical” that was published in, The Herald, Zimbabwe’s most popular and biggest Newspaper, and was as well republished in various other Newspapers and Magazines in other African countries.
In that article, I argued that, theory based and powered curricula as administered in most African universities, cannot spur a critical mass of skilled graduates needed to transform African economies and called, for its total overhaul.
In the same article, I called upon, African governments to step up funding to their universities and compel them to overhaul cramming based learning and adopt research powered learning.
Research powered learning especially in the experimental sciences curricula, makes students, to gain knowledge of producing inventions, innovations, and ground breaking technologies, which if backed by supportive conducive governments’ policies, can be a catalyst, in spurring industrial and entrepreneurial development in African countries. It also enables the students from social sciences and humanities field, to gain interdisciplinary knowledge, that in turn makes them, critical thinkers, capable of objectively analyzing public policies and other issues at hand, and provide remedies where inadequacies exists.
Africa’s skyrocketing unemployment problem, especially youth unemployment that is affecting millions of youth on the continent, is a manifestation, of the failure of governments and universities, to harmonize their visions, into one complimentary vision of finding solutions to the challenges facing the continent.
Universities are supposed to be the center of knowledge production and dissemination where learners are equipped with relevant knowledge and skills that makes them capable of solving societal problems and meeting societal needs. Are African universities serving this purpose fully?
Globally, research is a chief driver of new knowledge and innovation crucial for spurring sustainable industrial and entrepreneurial development, but how much of the research have African universities done or are doing that have translated or are translating into industrial commercial usable products? Why is it that, African industries are majorly powered by imported technologies despite the fact that we have engineering and technology faculties at our universities?
In the medical field, why is that all the health complications that requires specialized surgeries are mainly done outside Africa with those unable to afford it dying miserably despite us having medical schools/faculties at our universities? Still in medical sector, why is that the few molecular biologists in our countries are unable to use computerized technologies to read and analyze the genomes of viruses and only do so after being subjected to re-training by experts trained from abroad?
African governments are supposed to apportion a good percentage of their national budgets for research development, if research, is to result into implementable policies and industrial usable products. But wait a minute! Looking at countries’ national Budgets, how much money percentage wise does African countries allocate to their institutions for research development?
Governments are also supposed to create robust favorable environment and opportunities for its employable citizens not only at national level, but also at international level, by incorporating in their foreign policies and international relations, the issue of systematically and legally transporting their employable labor to other countries where it is needed through bilateral relations, like what Cuba, Russia, China, and India have done and are doing. What are African countries doing in this regard?
For example, on realizing that, it cannot employ, all its trained Doctors, Cuba, decided to integrate medicine as a fundamental element in its foreign policy and international relations, as thus, eighty percent of Doctors and health professionals in Venezuela, are Cubans, send there by the Cuban government, on bilateral arrangement with Venezuelan government, where by Cuba, supplies medical workers in return for oil and gas supplies from Venezuelan government. Cuba also has hundreds of Doctors working on bilateral arrangement in other Latin American and African countries. Russia, India, and China, who produces, highest number of technology specialists and professionals in life and experimental sciences also does the same.
To the Chinese government, where there is Chinese capital and trade, there should be Chinese labor. Many people keep on wondering, why there is large presence of Chinese engineers, technicians, and traders, especially allover in African countries and other developing nations, forgetting that, transportation of labor to foreign countries, is a cardinal part of Chinese foreign policy and international relations. In fact, all the major infrastructural development projects in Africa, like major road high ways, Dams, buildings and industries construction, have been and are being executed by Chinese supported companies and labor
To overcome, the waves of rural- urban migration tied unemployment, and curb horrible unemployment figures among its science and technology specialists, the Chinese government, developed an economic diversification policy aligned, to urbanization, industrialization, and transformation of rural locations, into production centers, which involved relocating major industries from already congested industrial centers to rural areas, thus expanding industrial base and creating new towns and employment in the process, Wuxi and Nantong for example, owe their transformation from rural to major industrial centers to this policy.
In sum, universities’ curricula must be research derived and interdisciplinary powered, for the graduates to translate the acquired knowledge and skills, into industrial usable products and attaining critical thinking skills, capable of finding solutions to the societal challenges and needs and African governments must ably fund their varsities for this to happen in addition to putting in place, the implementable policies that stimulate entire spectrum
Moses Hategeka is a Ugandan based Independent Governance Researcher, Public Affairs Analyst, and Writer
Fitch affirms African Development Bank’s Triple ‘A’ rating with Stable Outlook
August 12, 2017 | 0 Comments
Leading global rating agency Fitch Ratings has affirmed the African Development Bank’s (AfDB) Long-Term Issuer Default Rating (IDR) at ‘AAA’ with a Stable Outlook and its Short-Term IDR at ‘F1+’ (best quality grade, indicating exceptionally strong capacity to meet its financial commitments).
In a statement released on 4 August, the agency said the ‘AAA’ rating primarily reflects extraordinary support from AfDB’s shareholders which provides a three-notch uplift over the Bank’s intrinsic rating.
“AfDB enjoys strong support from its 80 member states, which include 26 non-African countries with high average ratings. Callable capital subscribed by member states rated ‘AAA’, the largest of which are the US, Germany and Canada, accounts for 21% of the total. This fully covered the Bank’s net debt at end-2016, underpinning the ‘aaa’ assessment of shareholders’ capacity to support,” the statement said.
The report underscores the strong propensity of member states to support the Bank in case of need as illustrated by previous capital increases and the Bank’s important role in the region’s financing.
In the assessment, Fitch maintains that fast growth in AfDB’s lending in the last two years has translated into a rapid increase in its indebtedness, noting that the Bank’s Management has indicated that if there is no clear evidence of a capital increase within the next two years, it will have no choice but to curb lending growth to preserve the Bank’s solvency metrics. The report added that if no capital increase is approved by 2019, debt will not be fully covered by callable capital from ‘AAA’ rated countries, adding that this would place substantial pressure on Fitch’s assessment of extraordinary support and, hence on AfDB’s IDR.
Fitch asserts that the relatively high risk profile of borrowers is mitigated by the preferred creditor status (PCS) that the Bank enjoys on its sovereign exposures.
Fitch assesses AfDB’s liquidity at ‘aaa’, which reflects excellent coverage of short-term debt by liquid assets (2.9x). However, Fitch notes that the share of the portfolio invested in securities or bank placements rated ‘AA-‘ or above (83% in 2016) is declining, although their quality is still assessed at excellent. Fitch understands that management intends to rebalance the treasury assets portfolio in order to increase the proportion of assets rated ‘AA-‘ or above. This would help underpin Fitch’s assessment of the strength of extraordinary support, given the relevance of liquid assets’ quality to the net debt calculation.
“The -1 notch adjustment to AfDB’s solvency stemming from our assessment of its business environment reflects the high risk operating environment in which the bank operates,” the report says, noting that the majority of African countries are classified as low income by the World Bank. The average income per capita and average rating of member states are the lowest of all regional MDBs, and they are subject to an overall high level of political risk.
Commenting on the rating, AfDB Acting Vice-President for Finance, Hassatou Diop N’Sele, said, “We welcome the confirmation of the AfDB’s AAA rating by Fitch, with a stable outlook. The Bank is dedicated to doing the most to make a marked positive difference in the lives of hundreds of millions of Africans, while at the same time preserving its financial integrity. Our High 5agenda is our response to the need to accelerate and scale up Africa’s development to achieve the Sustainable Development Goals of the continent. The High 5 agenda, reflecting five identified priority areas (namely energy, agriculture, industrialization, integration and human capital development), enjoys strong support from our shareholders. The AfDB will continue to maintain a careful balance between maximizing its development effectiveness and assuring complete preservation of the interests of its stakeholders.”
Heads of State and business leaders to gather once again in Sharm El Sheikh for Africa 2017
August 3, 2017 | 0 Comments
Over 1,000 delegates expected during the three-day forum to discuss and collaborate on African trade and investment
CAIRO, Egypt, August 2, 2017/ — The Ministry of Investment and International Cooperation of Egypt and COMESA Regional Investment Agency announced today the holding of Africa 2017 (www.BusinessForAfricaForum.com), a high-level forum offering participants an unparalleled platform for promoting trade and investment within Africa. The Forum will be held under the High Patronage of H.E. President Abdel Fattah El-Sisi, President of the Arab Republic of Egypt on 7-9 December 2017, in Sharm El Sheikh, Egypt.
The three-day conference will convene high-level delegations of leaders in business and policy from across Africa and worldwide, including heads of state and some of the most important CEOs of the continent.
Africa 2017 will kick-off with a Young Entrepreneurs Day (YED) that will bring together emerging entrepreneurs with more established ones, in addition to mentors, start-up hubs, angel investors and venture capital firms, to share ideas, network and help drive further the business ideas of tomorrow. The Africa 2017 YED has partnered with top-notch incubators, entrepreneurship programmes and VC funds. Egypt is known across Africa and the Middle East to have developed pro-innovation ecosystems where emerging entrepreneurs have been able to flourish.
In 2015, Egypt hosted the Tripartite Summit where a free trade agreement was signed, bringing together three regional economic communities, SADC, EAC and COMESA, effectively creating, with its 26 Member States, the largest trading block on the continent. This ‘borderless economy’ would rank as 15th in the world in terms of GDP.
Speaking on the Forum, H.E. Dr. Sahar Nasr, Egypt’s Minister of Investment and International Cooperation, reiterated the African opportunity based on business-minded reforms taking place across the continent: “The Forum has the objective of promoting investments into our continent, and especially cross-border investments. In Egypt, we have undertaken an ambitious economic reform programme, of which a key ingredient is improving the business environment and overall country competitiveness. Such efforts go hand-in-hand with our commitment to serve as a strategic gateway for Africa and the world.”
As part of the Forum, Egypt will be showcasing its flagship mega-projects including the construction of a new capital city 45km outside of Cairo, and a number of industrial and special economic zone projects along the Suez Canal, among others.
This Forum reinforces Egypt’s commitment to support and enhance the economic and cultural integration of Africa and to spur investment into what is still one of the fastest growing regions in the world.
Commenting on the sustained investor confidence with regards to Africa and the Forum, Heba Salama, COMESA Regional Investment Agency Director, says that “Africa, and in particular the COMESA Region, continues to offer some of the best returns on investment in the world. Africa 2017 will be an unparalleled occasion to gather the architects of Africa’s future and drive further the transformative investment projects of tomorrow”.
The Forum is by invitation only. Interested parties can apply for an invitation through the event website www.BusinessForAfricaForum.com.
Regional protection force soldiers soon in South Sudan: UN
July 31, 2017 | 0 Comments
By Sam Mednick*
The 4,000-strong force is meant to protect civilians from the gang rapes and other abuses seen during the fighting that erupted in the capital, Juba, a year ago. Its arrival has faced pushback from South Sudan’s government.
South Sudan’s civil war is well into its fourth year, with more than 50,000 people killed.
U.N. peacekeeping mission chief David Shearer says a deal has been reached on a base for the troops in Juba. He calls it a “significant positive step forward” and one that will give the U.N. the “flexibility to extend its presence into areas beyond Juba where peacekeepers may be needed.”
Rwandan soldiers are set to arrive Aug. 6, with Ethiopian troops coming in September and November. The small number already in place includes 150 Nepalese.
The signing of the base agreement between South Sudan’s government and the U.N. comes shortly before U.N. peacekeeping chief Jean-Pierre Lacroix visits the country. Lacroix is expected to meet with government officials and advocate for a country-wide cease-fire.
In a World of Disarray, Africa Is Taking Steps Forward
July 31, 2017 | 0 Comments
At this juncture in mid-2017, while the Middle East remains highly turbulent and global security challenges remain acute from Korea and East Asia to Ukraine and Afghanistan, what is the state of security in Africa? A continent of fifty-four nations, ranging from the Arab regions of the north to the Sahel region and a number of subzones in Sub-Saharan Africa, there are of course many stories to tell. But three stand out. The net assessment for the continent as a whole, while far from rosy, has a number of promising dimensions.
Africa’s security situation might be summarized as follows:
First is the state of terrorism and extremism. This remains a tough and disturbing story, overall. Countries from Mali to Libya to Somalia have been afflicted, by Al Qaeda in the Islamic Maghreb, ISIS, and Al-Shabaab among the key perpetrators. Terrorist attacks have also occurred in places such as Kenya and Burkina Faso. It is hard to talk of improvement in any of these places. At least things are not getting worse on balance. Indeed, there has perhaps even some slight improvement in Nigeria in particular, where the fight against Boko Haram continues(and occasionally spills over slightly into neighboring countries like Cameroon), but where the International Institute for Strategic Studies reports a reduced fatality rate relative to 2015.
Second is the state of civil war and famine in several key countries in the general east-west swath of land that includes the semi-arid Sahel region of Africa. This is a tragedy happening before our eyes in real time. It involves a belt of nations overlapping with some of the countries suffering from terrorism and extremism. The Sudans, Central African Republic, Somalia and Nigeria are among the worst hit, with parts of these countries collectively now containing more than 15 million people at acute risk of starvation. Beyond the specific risks from famine, South Sudan continues to devour itself in pointless and petty violence that involves huge numbers of sexual crimes as well.
Other conflict zones in this swath of countries may be faring slightly better. Sudan does not have the degree of infighting it suffered a decade ago, even if it is far from peaceful. On June 19 of this year, the Central African Republic’s government and thirteen of the fourteen armed groups in the country signed an accord to end ethnic and religious conflict. However, it is too soon to know if this will lead to a meaningful trend towards stability.
Third is the continent writ large, encompassing the majority of the nations in Africa. Most of it is more peaceful that it has been, on average, since the waves of independence in the late 1950s and 1960s or during most of the Cold War and then the 1990s. On balance, Africa is slightly more stable (and somewhat more democratic) than ever before in modern times.
Of course, this is a provisional judgment—and whatever peace may be breaking out coexists near lots of ongoing conflict and also requires many peacekeepers to sustain. Indeed, there are currently eight United Nations peacekeeping operations in Africa: UNMISS in South Sudan, UNISFA in the disputed Abyei region, UNAMID in Darfur, MONUSCO in the Democratic Republic of Congo, MINUSCA in Central African Republic, MINUSMA in Mali, UNMIL in Liberia and finally MINURSO in Western Sahara. Overall, there are over 92,000 personnel serving in UN peacekeeping operations in Africa.
In addition to collaborating with the UN in Darfur, the African Union has two active peace operations: AMISOM in Somalia, and the Regional Cooperation Initiative for the Elimination of the Lord’s Resistance Army (RCI-LRA). There are over 22,000 deployed AMISOM personnel, with most of its troops coming from Uganda, Burundi, Djibouti, Kenya, Ethiopia and Sierra Leone. RCI-LRA has a Regional Task Force of over 3,000 soldiers from Uganda, South Sudan, DRC and CAR.
Political tensions over transfers of power, or more commonly, the absence of a transfer of power, make things dicey in several other countries, too. Too many leaders are holding onto power indefinitely, either through sham elections or no real elections at all, or the dominance of political organization and process in their respective countries that allows them to get elected more or less indefinitely. Not only DRC and Burundi, but Rwanda, Uganda, Zimbabwe and Angola are notable examples of this dangerous trend. Even in a relatively benign case like Paul Kagame’s Rwanda, where the strongman leader has undoubtedly delivered much for his country, the tendency towards a “presidency for life” pattern of behavior puts democracy—and national stability—at risk.
Indeed, eight presidents in Africa have now amassed more than 229 years in power between them. These include: Eduardo dos Santos from Angola (thirty-seven), Teodoro Obiang Nguema from Equatorial Guinea (thirty-seven), Paul Biya from Cameroon (thirty-three), Idriss Deby from Chad (twenty-six), Denis Sassou-Nguesso of Congo-Brazzaville (thirty-two), Yoweri Museveni of Uganda (thirty-one), Paul Kagame of Rwanda (seventeen) and Joseph Kabila of the DRC (sixteen). Beyond just these cases, Africa’s trend towards democracy, after an impressive period of improvement in the 1990s and 2000s, has plateaued: Freedom House ranked four African countries as free in 1998, eleven as free in 2007, but only ten as free in 2016.
There are more hopeful political stories too, of course. In January 2017, former Gambian President Yahya Jammeh left the country after twenty-two years in power, marking the first president to peacefully hand over power in Gambia since its independence from the British in 1965. The Gambia’s peaceful transition of governance gives hope for future democratic elections. More significantly, a successful election in Kenya in August could give the cause of African democracy a substantial boost.
Southern Africa, including Angola and Mozambique, remains fairly quiet in terms of conflict if not necessarily politics. Most of West Africa is moving well beyond the civil wars of the 1990s and 2000s (and the Ebola crisis of 2014). Ethiopia, the continent’s second most populous state, may have quieted down somewhat after significant unrest a couple years ago.
On balance, there are ample troubles today in Africa, as always. Yet fatality rates are down more than half relative to the 1990s, according to data from the Peace Research Institute of Oslo and Uppsala University in Sweden among others (and economic growth rates, while slower the last couple years, have typically reached 4 to 5 percent annually in the 2000s, after decades of far worse performance). Overall, in a world characterized by disarray, it may be somewhat risky but still fair to venture that Africa continues to move gradually if fitfully forward.
*Source National Interest.Michael O’Hanlon is a senior fellow at the Brookings Institution. Emily Terry is an intern with the Brookings Africa Security Initiative.