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John Dodelande, curator of contemporary art, launches a reference database for Chinese Contemporary Art

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John Dodelande

John Dodelande has been active in the contemporary art market for more than ten years. He has more specifically focused his collection on Chinese contemporary art works and young artists of the new generation (Wang Yuyang, Wang Sishun, Wang Guangle among others…) who are moving away from both the aesthetics and the spirit of his elders (notably the cynical realists movement which became known to a large audience at the international level by artists such as Yue Minjun, Ai Wei Wei…).

Like all market players, he was led to question the tools available to him to carry out his day-to-day business, particularly in the digital environment.

Beyond the institutional websites and networks of the auction houses and the databases most used by practitioners (Artnet.com, ArtMarket.com, Artprice.com), he noted the monopoly of certain players on the one hand, and on the other hand, the fragmentation and splintering of information and the difficulty of sorting through dozens or even hundreds of sources, each of which obey their own logic and their own rules.

Thus, he most often felt that he had to define for himself the parameters and criteria that would enable him to guide his choices and actions.

With regard to the field that interests him more particularly that of contemporary art and Chinese art in particular, he noted the absence of a relevant, effective and pragmatic reference tool capable of identifying works and artists, of drawing up an inventory of the market and practices and finally of guiding the choices of market players.

John Dodelande confides to us: “Being myself a Digital Native, the world of social networks, digital tools are my usual environment. However, I very quickly had the feeling that I couldn’t find what I was looking for and that I was wasting a lot of time because I didn’t have a real database organized by type of market, category of works, which would take into account the geographical and economic dimension, which are fundamental factors in understanding the market as a whole”.

John Dodelande is thus developing with partners a new tool that is destined to become the reference database for Chinese Contemporary Art and, in the long term, for Asian Art in general. This database, accessible to the general public free of charge for its educational presentation component, will be available by subscription to professionals who will have access to valuable information on artists, works and transactions, providing an overview of this particular market and its evolution.

It goes without saying that John Dodelande’s vocation is to deploy this technology on other target art markets and even other sectors of activity.

John Dodelande is expected to announce the launch of this innovative platform in 2020.

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Anbessa: Best Foot Forward for This Ethiopian Shoemaker

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When you think of an international shoe exporter, Ethiopia may not be the first country that springs to mind. Yet Anbessa Shoe Share Company, based in the Akaky Kaliti suburb of Addis Ababa, has been making its mark across Africa as well as several international export markets. 

Originally founded in the 1930s by an Italian expatriate living in Ethiopia, the company has had an at times turbulent past. Operating as DARMAR in the 1950s, it made shoes for men, women, and children. But in the 1970s, it was nationalised by the Derg Regime, the shortened name for the ‘Provisional Military Government of Socialist Ethiopia’, a Communist Marxist-Leninist military junta that ruled Ethiopia from 1974 to 1987. The fall of communism worldwide also affected Ethiopia and led to the formation of the People’s Democratic Republic of Ethiopia in February of 1987. 

The company remained under government control until 2011 when it was purchased by the current owner, Ato Tedla Yizengaw. Yizengaw, a serial entrepreneur who owns several thriving Ethiopian businesses, and who has guided Anbessa into a new era with the backing of a strong board of directors.

Anbessa exports to Africa, the USA, EU, Middle East, and Asia

With a staggering 65-70% of the domestic market, Anbessa also exports to the rest of Africa as well as the USA, EU, Middle East, and Asia. While its primary product is shoes, it also manufactures bags and belts, ensuring that no leather is wasted in the production process. 

Its growth and success has been recognised by the Brand Africa 100 ratings, with position #23 in 2018 followed by an impressive climb to #12 in 2019. It is the sole Ethiopian brand recognised in the Brand Africa charts. Export figures for 2017 exceeded $750,000, a figure they hope to grow steadily with a new factory looking to increase production levels.

In September 2017, the company moved into a new UD$15 million production plant in Akaky Kaliti. The primary aim of the new plant was to ramp up production from the previous 3500 pairs of shoes made daily to a new output of 10,000 pairs daily. But Yizengaw is an astute businessman and knows that it’s not just about quantity; he needs to improve and maintain quality to increase their export market. So the company has partnered with the Leather Industry Development Institute (LIDI), an Ethiopian organisations founded in 2010 to offer training to all areas of the leather industry and to improve skills at all levels of the workforce.

To increase their export volume from 10% to 70%

More recently, Anbessa bought the bankrupt Habesha Tannery in July of 2019 for just under 1 million US dollars. This will allow the company to not only produce their own leather but also to have a much more hands-on approach to quality control at every stage of the manufacturing process. Anbessa sees the acquisition of the tannery as a crucial part of their plan to vastly increase their volume of exports. The machinery in the tannery – which Anbessa plans to expand – was worth over US$1 million alone, so it was a clever bit of business. The Turkish company who had owned the tannery had become bogged down in default payments with the Development Bank of Ethiopia. Anbessa hopes that the new acquisition combined with their new factory will increase their export volume from 10% to 70%. 

As well as the quality of their footwear, many commentators point to Anbessa’s business practices as a major positive. All the material they use in production comes from sustainable sources, a major selling point when it comes to international markets. And their focus on fair treatment for all their workforce – up to 1,636 since moving to the new factory – also draws praise. The staff received discounted meals in the factory’s modern and clean cafeteria. Every staff member also receives free medical check-ups, and the factory itself meets stringent safety standards. The company also adheres to International Labor Organization (ILO) regulations, ensuring that all staff are of minimum working age and that no minors are ever employed. 

With experienced and forward-thinking management, a dedicated and well-treated workforce, and quality products that are being more and more recognised internationally, Anbessa is a success story that looks like it will keep on growing. 

Photos: resolution.studio / squarespace-cdn.com / twimg.com

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Transmashholding’s African Adventure

Comments (0) Africa, Transport

Andrey Bokarev’s railway machine manufacturing company, Transmashholding, acquires its First Factory in Africa as the Continent Seeks to Revitalise its Railway Systems and Trains

With Africa, the second-fastest-growing continent from an economic perspective, development of efficient and cost-effective transport and logistics infrastructure are of paramount importance. The continent is not only rich in resources but is also fast developing as a robust manufacturing centre. The challenge for these economies is to ensure swift transport of containers and goods to the various African ports and onto global markets. 

Rail transport is at the forefront of any logistics development and recent years have seen increased investment and new initiatives. And with the planned Africa Integrated High-Speed Network – part of the Agenda 2063 Continent Development Plan – gathering steam, almost every African country is now looking to invest, or seek investment, in improving their railway infrastructure and stock.

The Real Way Forward is the Railway

The main hurdle facing these plans is that existing railways systems, mainly dating from the colonial era, are often in poor states of repair or the routes are unsuitable for future plans. The latter of these factors is mainly due to colonial planners usually using the shortest or quickest routes rather than ones which brought benefits to the country as a whole. Another long-range hurdle to continental integration is the fact that there are at least six different gauges in use. 

The inauguration of Transmashholding’s (as TMH Africa here) first African factory in April of 2019 illustrates the Russia-based conglomerates’ commitment to expansion and investment across Africa and Company’s president Andrey Bokarev business talent (a few months after a €1bn five-year contract between Egyptian National Railways and Transmashholding-Hungary  were signed in 2018.) The 45,000m² plant, situated in Boksburg, Gauteng, has been producing rolling stock since 1911, thus allowing TMH Africa to hit the ground running with an existing facility and workforce. 

The South African factory marks stage one of TMH International’s planned investment in Africa of over $32 million, and initial plans at Boksburg include the upgrading of the factory and machinery as well as retraining and upskilling of current employees.

TMH Enters the South African Train Market

It is also worth noting that Gauteng Province is the location of the Tambo Springs Project, a greenfield transport hub comprising road, air, and rail, and valued at $15 billion. There is also the planned container terminal at Ekurhuleni, some 20km from the new TMH International facility. 

South Africa is now the leading country in Africa for rail freight – at 99.5Mt a kilometre – and the map below shows not only how intensive the African Union’s plans for developing transport infrastructure is, but also how central to that plan South Africa is. 

Jerome Boyet, CEO of TMH Africa, sees the company’s role in Africa as being a local partner with local and global manufacturing companies seeking to fulfil orders across Africa as well as producing their own rolling stock. As Boyet pointed out, a large part of their decision to choose this location was based on: “…our understanding that South Africa’s real potential to become a leader in rolling stock manufacturing for Africa remains untapped.”

With continued economic growth and inward investment to transport systems across the continent, most observers would agree that TMH Africa’s investment is one with long term promise.

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Dr. Bouamatou: breaking down the gender barriers in banking

Comments (0) Africa, Business

While it would be fair to say that actual talent in the world of finance is distributed equally by gender, it would also be fair to note that this talent is not equally distributed among the top tiers of management. In fact, it was only in October 2019 when the Royal Bank of Scotland announced that Alison Rose would be its next chief executive that a woman finally reached the top position in a global bank. The same month, Citigroup named Jane Fraser as President, a move many commentators see as preparing her for the CEO position. IMF figures show that only 2% of banking CEOs globally are women. 

There is plenty of female talent within the finance industry, but generally, the glass ceiling tends to hold them back from the top positions. That glass ceiling often means salary disparity too. In January 2019, Citigroup revealed that its female employees receive on average 71% of their male counterparts. Given that they have over 200,000 employees, with more than half of them women, hopefully, this honesty will see the pay gap closing. 

In emerging economies, the appointment of women to top positions is doubly important. Not only does it address gender disparity, a major issue in many African and Latin American countries, but it also helps the institutions connect more readily with the 1.8 million unbanked women that the World Bank is targeting in Africa and Latin America as part of their 2020 financial inclusion goals. 

Dr. Leila Bouamatou : An Impressive Credentials 

One such woman who currently stands out is 35-year-old Dr. Leila Bouamatou, who is currently Managing Director and Board Member at Générale de Banque de Mauritanie (General Bank of Mauritania). Dr. Bouamatou holds a Master’s Degree in Finance from Barcelona’s EADA Business School, an Executive MBA in Business Administration from South Mediterranean University, and a Doctorate in Business Administration from Fox School of Business & Management. Impressive credentials quickly silenced any critics who say she gained her position through her father, Mohamed Ould Bouamatou, who founded GBM in 1995 as the first private bank in Mauritania. 

Dr. Bouamatou trained in Tunisia with Deloitte’s, with MediCapital Bank in London, and then with BMCE Bank International Plc – who specialize in African investments – also in London. She had just been offered a lucrative contract in London when her father asked her to return home and join the treasury department of GMB. She served as Head of the Treasury Department for 10 years, before being promoted to managing director and board member.

While Mauritania is one of the poorer African countries at the moment, economic development looks good, thanks mainly to a program of reforms which will hopefully be continued by the new president, Ould Ghazouani, who won the election of June 2019, taking over from retiring president, Mohamed Ould Abdel Aziz. On an optimistic note, it is worth remembering that this was the first peaceful change of ruler since the country gained independence from France in 1960. Those reforms have meant that Mauritania is ranked in the top 10 of global reformers. But it is also worth noting that the country continues to have a large foreign trade imbalance though GDP is forecast to rise by 5.2% in 2019 after two years’ steady at 3.5%.

To Break Down the Disparity Barriers in Africa

Dr. Bouamatou is a huge supporter, not only of financial inclusion for women but also of empowerment and breaking down the disparity barriers across the continent. Speaking to her alma mater, Fox School of Business & Management, she said:

“Women are getting more and more educated and becoming more and more ambitious. Fathers are more and more supportive of their daughters and more open-minded, compared to previous generations.”

Dr. Bouamatou is married to Tah Meouloud, a fellow graduate of Fox School of Business & Management, and an economist who was head of human resources at BSA subsidiary BSA Technologies. They have two children.

A Statement against Discrimination against African Women 

Dr. Bouamatou always wears an El-melhfa, a traditional piece of cloth which covers her from ankles to face. While many see El-melhfa as a Muslim tradition, it is more a Saharawi tradition, one which is worn by all religious and ethnic groups of the Saharawi. It is a symbol of Saharawi pride and resistance, especially in what these people view as ‘occupied territories’. Because of its visibility, wearing it can often lead to discrimination against women. By choosing to always wear it, Dr. Bouamatou not only acknowledges her heritage, but she also makes a statement against discrimination against women throughout Africa.

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7th Single Window Conference Looks to Boost Trade Links

Comments (0) Africa

Between the 17th and 19th of September 2019, the 7th annual International Conference on Single Window of the African Alliance for Electronic Commerce (AACE) was held in Yaoundé, the capital of Cameroon. Present were leading players in logistics and supply chains, and over 40 delegations for foreign countries including 18 African countries. 

The idea behind a single-window system is to improve the efficiency of international trade, in this case particularly the concept of intra-African trade across the region. In order to work properly, this would require a single entity or location where companies would submit all their documents such as customs declarations or permits for import and export. So, if a company in Kenya wished to export its goods to 12 other African countries, rather than going through 12 separate sets of regulations and multiple submission of documents, they would instead do it all through one single entity. 

A single market with a billion consumers

Africa has seen a lot of rapid economic development in recent years, much of that down to cooperation across the continent. Recent developments have included the African Continental Free Trade Area Agreement (AfCFTA) in March of 2018, which has committed to removing intra-regional tariffs on some 90% of goods. If this agreement is successful it will create a single market with in excess of a billion consumers and a total GDP of over US$3 trillion. It was an agreement that the continent needed badly; in 2017, African intra-region trade only accounted for 17% of exports. When compared to Asia (59%) and Europe (69%), it is clear that as a potential trade bloc, Africa was lagging behind and missing out on the many benefits that come with such high rates of ‘local’ trade. 

The September conference focused on two main aims; the growing potential of e-commerce across the continent, and optimizing the supply chains of landlocked countries with no port access. The latter of these is something that will need massive investment in infrastructure, particularly railways and roads. And we are seeing that investment already happening across Africa.

450 million African mobile users and 300 million more expected

But it is the e-commerce factor which is perhaps the most exciting as it needs a lot less in terms of total investment. In some ways, Africa has been able to leapfrog many developed nations in terms of developing e-commerce. With lower rates of banking and credit card use, there has been a need to develop innovative payment methods such as e-wallets which people can top up at local agents, giving them a balance on their mobile with which to purchase goods. And with generally widespread internet penetration across much of Africa, there are large numbers of new consumers coming online. With around 450 million mobile users currently and another 300 million expected to have access in the next 3 years or so, companies are recognizing the potential of this reservoir of consumers with disposable income. 

The concept of the single window is a natural step in the development of AfCFTA. These annual conferences aim to develop the single window concept following the guidelines already established by the World Trade Organisation (WTO) and the World Customs Organisation (WCO). While a continent-wide single window may be some years off, The African Alliance for e-Commerce hopes to establish national and regional ones as a stepping stone to a continental one. Many African countries are already cooperating on cross border trade already, with several trade zones already in operation. Of particular note is the East African Community (EAC) which comprises Burundi, Kenya, Rwanda, South Sudan, Tanzania, and Uganda. It has shown the best progress as far as moving towards a common trade area is concerned and could serve as a template for the continent as a whole. 

A single window to reduce tax and to optimize the African potential

Developing single window systems will reduce tax and tariff burdens and make the movement of goods across borders far easier than the present. But there are still many barriers to successful implementation. The continuing conflict in some areas, low-level corruption at borders and customs points, and even the motives of individual countries may hamper a quick solution. But with the massive potential for businesses, there will be a continued push to establish an Africa-wide single window in the near future.

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Can Russia be a major player in Africa? Outcomes from Sochi.

Comments (0) Africa, Economy, Politics

With the ongoing competition between Russia and China trying to take the lead on African investment and partnerships and the United State’s revived interest over the continent, Russian President Vladimir Putin hosted a Russia-Africa summit in Sochi from the 23rd to the 24th of October.

National belts are tightening globally, and FDI (foreign direct investment) has been decreasing worldwide, yet Africa has been the one region to see the opposite, with FDI to the continent rising in 2018 to US$46 billion, a year on year rise of 11% from 2017. Yet while we may see China and Russia as the ‘main players’ in Africa, the two superpowers remain behind other nations in terms of total investment, with France leading the way followed by The Netherlands and the UK. In terms of development aid, the show continues to be run by the U.S., China, and Japan, with little in the way of ‘no strings’ aid coming from Russia.

Many considered investment in Africa to be like a modern second wave of colonialism, where nations and multinationals sought to reap the benefits of expanding economies and massive amounts of untapped resources. But this time, the African nations have a lot more power when it comes to accepting investment, and the huge amounts of money flowing inwards are being channelled into infrastructure, transport systems, and bringing some of the lagging economies into the 21st Century.

This summit was meant to be a rallying call, an announcement to the world that Russia was back in Africa, a statement of intent that Russia’s decreased influence in Africa was about to reverse. So, did anything actually happen at Sochi?

54 countries, US$12.5 billion in deals signed

All 54 countries in Africa responded favourably to Vladimir Putin’s invitation. And 43 of these nations were directly represented by their respective heads of state like the President of Congo, Denis Sassou-Nguesso, or the Egyptian President, Abdel Fattah al-Sissi, who co-chaired the Sochi summit alongside Putin,

“US$12.5 billion in deals signed” claimed the banner headlines out of Moscow. But it is worth taking a step back and realising that most of these deals were memorandums of understanding, and these MOUs do not always come to fruition, so it is far too early to declare Sochi a success or a failure.

Russia has been the main military partners of some African countries for many years and has consistently been the main source of African arms over the last decade. So during this summit, Russia has confirmed it is multiplying military cooperation and defence agreements with several African countries like Mali.

Other areas where Russia is already doing very well in Africa are in the energy and transport sectors:

The Russian state corporation specialised in nuclear energy, Rosatom, has signed an agreement with Rwanda for the upcoming construction of a Nuclear Science and Technology Centre. This Centre plans to organize the production of radioisotopes that could be used in industry, agriculture and medicine. It will also be equipped with a nuclear facility powered by a 10 MW pressurized water reactor.The Russian railway equipment manufacturer, Transmashholding, has signed a €1 billion with Egyptian National Railways for the delivery of 1300 passenger cars. The company chaired by Andrey Bokarev has also signed a memorandum of understanding with Nigeria for the delivery of rolling stock for the Nasarawa-Abuja railway section construction project.

Andrey Bokarev, President of Transmashholding

Africa determines the future of the world’s agenda

If Russia is to continue competing in Africa, it must play to its existing strengths. While Russia may not be able to compete with the U.S. and China in terms of consumer goods and electronics, it should value its expertise in heavy industry and energy. If they fall behind too much in this game, then their own economy may stagnate, something the country wants to avoid. Thanks to this kind of summit, investment from Russia may increase in the years to come.

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Transmashholding Signs Major Egyptian Deal

Comments (0) Business, Transport

Summary: The deal between Egyptian National Railways and Transmashholding-Hungary Kft. looks like being the start of a long and fruitful relationship.

When Egypt’s first railway system was commissioned by the Regent of Egypt and Sudan, Abbas I, in 1851, he chose for it to be built by one of the 19th Century’s greatest engineers, Robert Stephenson. The vision was that Egypt’s transport system would rival the best transport systems globally.

Sadly, after many years of poor maintenance and management, Egypt’s rail system has in the last few decades become known as one of the world’s most dangerous. This has led to the Egyptian government making the decision to revitalise the entire infrastructure and rolling stock as well as investing in new routes. This was an important decision, not only in terms of improving safety but also in terms of economic development. Egypt’s rail network not only transports some 1.4 million passengers a day but is also a vital component in goods and container transport, especially when you consider that Egypt has the highest container traffic in Africa with almost 7 million units shipped annually. As most of this traffic passes through the Suez Canal, increasing rail capacity would help the country diversify its commercial transport networks.

1,300 passenger cars in 5 years with ENR Worth Over 1 Billion Euros

The announcement in September 2018 that Egyptian National Railways (ENR) had signed a contract with Transmashholding-Hungary Kft. (a Russian-Hungarian consortium) to produce and deliver 1,300 passenger cars represents a major part of the Egyptian government’s plans. Worth in excess of 1 billion Euros, the contract is for five years from the date of signing. Such a deal is also based on the close economic links between Egypt and Russia, and the choice of Transmashholding is no coincidence: the company led by an influential Russian businessman, Andrey Bokarev, is a world leader in railway manufacturing.

Transmashholding-Hungary Kft.’s production of the rolling stock represents a major part of Egypt’s planned investment in their railway systems, with over 3 billion Euros of total investment already announced. It is also the largest single contract ever agreed by Egyptian National Railways (ENR). Transmashholding-Hungary Kft. beat bids from companies from several other countries, including China, India, and Italy.

Production of the five different classes of passenger car will be split equally between the Hungarian side of the consortium, Dunakeszi Jarmujavito Kft., and the Tver Carriage Works in North-western Russia, which is owned by Transmashholding.Final assembly and fitting of the rolling stock will take place at a specially created plant in Egypt which will be a partnership between TMH International AG (part of JSC Transmashholding) and the National Organization for Military Production in the Arab Republic of Egypt. The plant will also enable maintenance of the new passenger cars.

A radical change for Egypt

Martin Vaujour, CEO of TMH International said: “This move could mean a radical change for the country because Egypt, despite being a very large country, has not really developed any railway industry at all.”

Even with such a massive project just signed, Transmashholding-Hungary Kft. is already looking to the future with plans to improve the connectivity of, and invest in, Cairo’s metro system which carries 4 million passengers per day. They are also looking at the potential of suburban trains for future projects.

With this initial contract signed at the beginning of Egypt’s redevelopment of their railway infrastructure and stock, future projects and involvement look promising for the Transmashholding-Hungary Kft. consortium.

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Is The 4IR the Way Forward for Africa?

Comments (0) Africa, Economy

To be able to look at Africa’s place in the fourth industrial revolution (4IR) we need to first consider what 4IR actually means. The third industrial revolution, or digital revolution, was the development of computers and information technology. 4IR, while seen by some as merely an extension of 3IR, is better separated into its own cycle, mainly because of the rapidity of progress in some areas and the wider repercussions and effects resulting from these new developments and technologies. 

A simple definition of 4IR would be: “The fourth industrial revolution is the current and developing environment in which disruptive technologies and trends such as the Internet of Things (IoT), robotics, virtual reality (VR) and artificial intelligence (AI) are changing the way we live and work.” (1) 

Is Africa ready to accept and embrace 4IR? Or is it, as some have suggested, even ready to lead it? Africa has almost half of the world’s fastest-growing and developing nations. It also has the youngest population of any continent. But the other side of that coin is the fact that 27 of the world’s 28 poorest countries are in sub-Saharan Africa and the average poverty rate is just over 40%. The World Bank also estimates that if current patterns continue, then by 2030, 87% of the planet’s extreme poor will be in Africa. 

“To provide digital skills to those that do not have them”

Could 4IR play a major role in reducing those figures? South Africa certainly thinks so. While many think that 4IR could take jobs away from people, South Africa sees it as an opportunity to revolutionize the jobs sector across the continent and to train a new generation in the necessary skills to boost African economies. 

South Africa’s Communications and Digital Technologies Minister, Stella Ndabeni-Abrahams, said: “We have to provide digital skills to those that do not have them. We have to make sure that we invest in different resources that we are going to need but most important is to identify what must be Africa’s niche in the fourth industrial revolution.”

A lack of internet penetration across Africa

One major barrier to Africa’s participation in 4IR is the fact that the majority of their available workforce is low-skilled or unskilled. Another, and perhaps more crucial, barrier is the current lack of internet penetration across the continent. Estimates from 2001 state that less than 14% of the population have access to the internet. For access to broadband services, that drops to 1% or lower. In 2015, the number of Africans using the internet varies greatly, from 1% in Eritrea to 57$ in Morocco. 

A declaration of willingness to fully participate in 4IR is not enough. And the idea of being the leader of 4IR will require more than optimistic words at a conference. There is a real need for urgent action, development, and investment in the following areas: heavy infrastructure such as railways, roads, energy supplies, light infrastructure such as ISPs and internet connections, training and education to transform that low-skilled/unskilled workforce into a computer literate, digital-savvy one. 

A monumental investment to create a 4IR economy in Africa

The investment to achieve all of this and to create a foundation on which Africa can create a 4IR economy of any type is monumental. Governmental funds could not hope to cover the amounts needed, so governments need to also create an atmosphere and conditions which will attract inward investment. There is also the option of loans, a very real possibility given the ongoing economic war of attrition in Africa between the three global superpowers. Going the loan route could be a double-edged sword though. On one hand, the current competitiveness between the superpowers means that for once, the country seeking the loan has some advantage in negotiating terms. But as with any loan, the downside is the repercussions should the country default on loans, repercussions which could be dire for decades after. 

To achieve any progress in this area, the lead has to be taken by the African Economic Community (AEC). A major part of even beginning on that path to progress is the African Continental Free Trade Area which fully came into force earlier in 2019. But with so much economic disparity across the continent, can the AEC or the Free Trade Area manage to achieve the balance between the nations or will the economic powerhouses such as South Africa be the only countries who can really take their place in the 4IR marketplace?

(1) https://whatis.techtarget.com/definition/fourth-industrial-revolution

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Russia and Uganda Sign Major Nuclear Energy Deal

Comments (0) Africa

For several years now, Africa has been the new battleground of the world’s superpowers. But this has not been a war fought with guns, tanks, or fighter jets, but rather one fought with loans, supply contracts, and doing anything to be one up on your competitors. 

The latest salvo in this ongoing economic war has been fired by Russia, or to be more exact by Rosatom, the Russian state corporation founded by Vladimir Putin in 2007 and which specialises in nuclear energy. A quick look at some of their statistics show just how big a player this corporation has become in 12 short years: largest electricity generator in Russia, producing almost 20% of the country’s electricity in 2017, ranks first in regards to foreign projects; 33 nuclear plants in 12 countries, leading provider of global uranium enrichment services with 1/3 of the world market, $300 billion of portfolio orders as of January 2017.

Energy and mining are the two sectors where Russia is particularly active in Africa, with Rosatom, Alrosa (mining), and Gazprom (natural gas extraction) leading the way. 

3 African countries in the top 10 list of global uranium producers

With the formal signing of an agreement on September 18th of this year for Rosatom to build a nuclear reactor in Uganda (the Memorandum of Understanding having been signed in 2017), Russia and Rosatom have cemented their position on energy production even further. 

It’s no surprise that nuclear energy is spreading across Africa. Three African countries (Namibia, South Africa, and Niger) are in the top 10 list of global uranium producers. Surveys by the Ugandan Ministry of Energy and Mineral Development estimate some 52,000 square kilometres of deposits across the country. 

Rosatom are slowly spreading their reach across the continent. They are currently building a $29 billion nuclear reactor in Egypt, though 85% of that cost is covered by loans from Russia, a fact that has some commentators worried about what possible defaults could mean. Rosatom have also signed a deal to build a reactor in Nigeria, as well as signing MOUs with Republic of the Congo, Sudan, and Ethiopia. As well as infrastructure and supply contracts, Russia and Rosatom are also investing in human resources. They already have a scholarship programme running in Kenya and are training locals to work in the nuclear industry in several African countries with a view to establishing close and long term relationships. 

With only one nuclear reactor, in South Africa, currently operating on the continent, it is still early days for the industry. And while Russia and China may be the current leaders in signing nuclear deals, don’t count out the USA just yet. While their once mighty 90% share of the global market has dramatically shrunk to around 20%, there is a renewed interest from the US State, Energy, and Commerce departments who are seeking to establish early relationships with countries who have long term plans to build a nuclear reactor in the future. 

Nuclear the best option for Africa?

But for now, it is Russia and China leading the way, with Russia looking to have the edge across Africa. This new deal, while it may take many years to come to fruition, illustrates future paths for other African countries. And though there are currently no financial details available for the Ugandan deal, it would be no surprise if there were loans in place similar to the deal with Egypt. And with constant developments in the field of nuclear energy, deals and MOUs agreed now may see different technology being applied when the reactor plants actually come to be constructed. Rosatom has the RITM-200 series reactor, a small modular reactor which is currently installed on some ice-breaking ships and which are expected to be installed in land-based plants around 2027, the same approximate timeframe as when there will be a proper framework, both infrastructure and regulatory, in the sub-Saharan region. 

Russia and Rosatom are playing a long game here, but with an eye of the growth of Africa’s population and industry which will demand cheap energy sources. If any regulatory framework can guarantee safety levels, then nuclear seems the best option for the rapidly growing continent.

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Making a Mark in Africa: Global Brands Dominate

Comments (0) Africa, Business

With Africa being one of the fastest growing markets for consumer goods worldwide, global brands have increasingly focused their efforts on the continent’s vibrant economies. Two major factors are worth noting here; Household consumption in Africa has outpaced GDP growth, and GDP growth across Africa is consistently outperforming global averages.

Consumer expenditure in Africa has been growing at a compound rate of 3.9% since 2010, reaching a total of $1.4 trillion in 2015, with that figure expected to reach $2.5 trillion by 2030. (1)

The planned Continental Free Trade Area (CFTA) is also due to be implemented by 2030, and if successful, will offer a single continental market for consumer goods and services as well as free movement of investments and businesspeople. This opens the doors to a potential 1.7 billion customers (based on projected population by 2030). 

African consumers tend to be loyal

With such ambitious plans and rapid growth, cementing a place as a major brand across the continent is a priority, not only for global corporations but also for African brands. 

Research has shown (2) that African consumers tend to be loyal to their chosen brands but also discerning in their choice of brand. While currently most consumer activity in Africa tends to still happen in informal market settings, there is, and will continue to be, a shift towards more modern shopping settings, including shopping malls and e-commerce, two sectors which will offer good growth potential at several levels. 

African brands have been declining year on year

However, the latest Brand Africa 100 ratings in May – published every year by African Business Magazine – show a continuing worrying trend, at least as far as African businesses are concerned. From a high of 25% of the list in 2013/14, African brands have been declining year on year and are now at a low of 14% from 17% in 2017/18. Asian brands have also suffered, falling 10% from the previous year. US brands saw the largest growth, up 17% to 28%, while the dominant European brands rose 2.5% to 41%. 

As you would perhaps expect, the leading brands are global household names, with Nike, Adidas, Samsung, and Coca Cola all retaining positions in the top 4 from 2017/18. The highest ranked African business is South Africa’s MTN Telecoms at 8th (down 2 positions from last year). The company operate in 21 African countries so far with more expansion planned, so their top 10 position should not only be safe but may improve again in future lists. 

Anbessa Shoe Share Company: the most impressive African performer

Ethiopia’s Anbessa Shoe Share Company, originally founded in the 1930s by an Italian expat, was the most impressive African performer. In the 2019 chart, it moved up 11 places to #12. As well as having around 65-70% of the Ethiopian shoe market, the company also exports to USA, EU, Middle East, Asia, and Africa.

There were only two new African names on this year’s list, South African retailer, Pick n Pay, who re-entered at #84, and Africa’s largest e-commerce firm. Jumia, who debuted at 74 after a successful launch on the New York Stock Market in April. 

With continued economic growth forecast as far ahead as 2030, African companies must now look at how they can compete with the global giants. 

(1) https://www.brookings.edu/wp-content/uploads/2018/12/Africas-consumer-market-potential.pdf

(2) Spivey L. et al. (2013) “Ten Things to Know About African Consumers: Capturing the Emerging Consumer Class,” Bcg.perspectives.

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