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Nigerian oil executive to lead OPEC

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Mohammed Sanussi Barkindo

The oil cartel appoints Mohammed Sanussi Barkindo to a three-year term as secretary-general beginning Aug. 1.

A Nigerian oil executive who helped develop key global climate change initiatives is the new-secretary general of OPEC.

The Organization of Petroleum Exporting Countries named Mohammed Sanussi Barkindo to a three-year term as secretary-general beginning Aug. 1. Barkindo replaces Abdallah Salem e-Bardri of Libya in the cartel’s top job.

Barkindo is an experienced oil executive who has worked for the Nigeria National Petroleum Corporation for more than two decades and was its director in 2009-10.

He also has deep experience with the oil cartel, including service as its acting secretary-general in 2006 and 15 years on OPEC’s Economic Committee.

Climate change work cited

According to Francis Perrin, Chairman of Energy Strategies and Policies, Barkindo’s work on climate change was also a decisive factor in his appointment.

Barkindo helped produce the United Nations Convention on Climate Change and the Kyoto protocol as the leader of Nigeria’s technical delegation to UN climate change talks.

Perrin said the appointment reflects growing recognition among cartel members of the importance of initiatives to stall climate change as OPEC struggles to find its footing on a shifting global energy landscape.

Barkindo is also seen as a neutral party in simmering regional political tensions between OPEC members Saudi Arabia and Iran as well as disagreements about oil production limits.

Long career as oil executive

Barkindo earned a bachelor’s degree in political science from Ahmadu Bello University in Zaria, a post-graduate diploma in the economics of petroleum from the College of Petroleum Studies at Oxford University in the United Kingdom, and a graduate degree in business administration from Southeastern University in Washington, D.C.

He has also been deputy managing director and chief executive of Nigeria Liquefied Natural Gas and managing director and chief executive of the international trading division of the Nigeria National Petroleum Corporation as well as general manager of the corporation’s London office.

El-Badri had been set to retire in 2013, but stayed another three years because cartel members were unable to agree on a replacement amidst Middle East political tensions and discord within OPEC about whether to limit oil production as prices dropped.

Venezuela, hard hit economically by the oil slump, put forth a candidate, Ali Rodriguez, its long-serving OPEC representative. Indonesia also considered fielding a candidate.

Neutral candidate

Saudi Arabia and other Gulf members said they supported Barkindo for his experience and because Nigeria doesn’t take sides in Middle East power struggles.

While the secretary-general does not have executive power in OPEC, the official often plays the role of a neutral mediator when there are differences within the group.

It likely will fall to Barkindo to mediate ongoing conflict in the oil cartel over whether to limit production to prop up oil prices.

OPEC has seen its influence on global oil prices waning amidst an oil glut coupled with the growth of production outside the cartel, including in the United States and Russia.

OPEC member countries produce almost 37 million barrels a day compared to non-OPEC production of 57 million barrels daily, according to Global Risk Insights.

Disunity amid oil slump

Despite waning influence, OPEC’s unwillingness to set production limits has played a major role in creating an oil surplus, which has precipitated a two-year crisis. The price of oil plummeted to a low of $26 per barrel earlier this year. The current price is about $45 a barrel, less than half price of $110 per barrel in 2014, when the crisis began.

Richer OPEC nations, led by Saudi Arabia, have been willing to take financial hits of low oil prices in order to preserve market share. OPEC has rebuffed calls to limit production by poorer members including Algeria and Venezuela, which have been hard hit by the slump.

After OPEC members again failed to agree on limits in June, experts said the discord underscored the cartel’s waning ability to influence oil prices.

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Kumba appoints new CEO, H1 earnings rise 20%

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JOHANNESBURG (Reuters) – Kumba Iron Ore said on Tuesday that Themba Mkhwanazi would take the helm as chief executive from Sept 1, replacing Norman Mbazima, who is stepping down to focus on his role as deputy chairman of Anglo American South Africa.

* Mkhwanazi, a former Rio Tinto manager, has been chief executive officer of Anglo American’s Coal South Africa business since May 2014.

* Kumba’s first-half results came in as expected, with the Anglo American unit posting a 20 percent rise in headline earnings per share to 9.41 rand.

* Kumba had flagged to the market that it expected first-half profit to increase between 14 and 23 percent because of a deferred tax asset in the comparative period.

 

(Reporting by Ed Stoddard; Editing by Joe Brock)

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Mauritius exporters see Brexit crimping textile export earnings to UK by 10%

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PORT LOUIS (Reuters) – Revenues generated by Mauritius from textile exports to Britain will decline by about 10 percent this year as a result of the British vote to leave the European Union, the country’s export association said on Monday.

The EU is Mauritius’ largest trading partner. The Indian Ocean island nation earns an annual average of 25.55 billion rupees ($722.77 million) from goods shipments to the bloc.

Britain remains the largest buyer of Mauritian goods within the EU, accounting for 18 percent of total exports to the bloc. Textiles are Mauritius’ top export to the UK, followed by seafood and sugar.

“Quantity wise, there will be a drop of 10 percent in our exports to the UK as a consequence of the fall in consumerism level in UK coupled with the depreciation of the pound,” the export group said in a report.

The Mauritius Exports Association (MEXA) report said 90 percent of all revenues from exports of textile and apparels to the UK comes in pounds while imports are in U.S. dollars.

MEXA said exporters’ profitability is expected to be “squeezed both in terms of exports and imports; exports revenue being depleted with the depreciation of the pound…and costs being inflated with the appreciation of the U.S. dollar.

“Companies are thereby faced with a double whammy.”

In 2015, textile and apparel exports to Britain amounted to 6.57 billion rupees, according to MEXA data.

($1 = 35.3500 Mauritius rupees)

 

(Reporting by Jean Paul Arouff; editing by Elias Biryabarema and Mark Heinrich)

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South Africa’s Standard Bank awarded banking license in Ivory Coast

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JOHANNESBURG (Reuters) – South Africa’s Standard Bank has been awarded a banking license in Ivory Coast, one of Africa’s fastest growing economies, extending its reach to 20 countries on the continent, the lender said on Monday.

“Standard Bank – trading as Stanbic Bank – has been formally awarded a banking license in Côte d’Ivoire,” it said in a statement, adding that it was gearing up to commence banking operations but did not give a timeframe.

 

(Reporting by TJ Strydom; Editing by James Macharia)

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Catherine Mahugu: Inspiring Women in Kenyan Tech

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Catherine Mahugu

Catherine Mahugu is a tech innovator from Kenya who has built an empire on socially beneficial projects and connectivity.

Catherine Mahugu is leading the way in the Kenyan tech industry. Currently working from San Francisco for her e-commerce accessories business which connects consumers and local African manufacturers, she has made waves across the tech, IT and retail worlds. She credits her early interest in science and technology to her engineer father and at just 27, she has achieved a great deal in these industries.

Early life

Mahugu graduated from the University of Nairobi with a bachelor’s degree in Computer Science. From an early age she broke the mold, favoring entrepreneurial projects over “corporate” roles that she considered to be the “safe option.” Her first projects were collaborations with her student colleagues at university, such as a mobile application that helps rural water vendors connect with customers by advertising their location and prices.

Combining her degree, enterprising spirit and intimate knowledge of the regional issues affecting her native Kenya, Mahugu has been at the forefront of creating many projects that benefit local people. Her first official foray into the tech world was with KamataKab, a mobile solution that uses GPS to locate taxis in the area, an option to contact and then a rating system to rate the taxi’s service for other users to utilize. Although this was the overall winner at the Garage4Kenya awards in 2011, Mahugu knows that this app was a little too ahead of its time; it didn’t meet the recent successes of Uber and Easy Taxi today. This hasn’t fazed Mahugu however, and she feels that the experience showed her that innovation was a viable career route and that her ideas had traction in the tech world.

Innovation, Innovation, Innovation

The building blocks to her latest enterprise can be seen in her next project, SasaAfrica. This provided the foundations for Soko, launching an app that allowed merchants to connect with customers using only their mobile phones. The idea for the projects came from a chance meeting with the two other founders while in Nairobi. They all believed in a future for mobile phone technology to help African enterprises. With the percentage of mobile phone usage up to 90% in some parts of Africa, they realized that is was an obvious global solution to connectivity issues between consumers and vendors. After seeing many predominantly female artisans at local markets struggling to sell their ware to a limited customer base, they decided to launch a global marketplace that these vendors could access, in which they could accept orders and then organize distribution.

soko artisans

Profiles of the artisans on the ShopSoko.com website

Now based in California, the company helps over 1,000 artisans sell their products to a global community. After joining the Soko network, users see their yearly income increasing by a massive 400% on average. They now operate in over 40 countries and plan to expand to reach vendors in Mexico and India. Mahugu is committed to overcoming the challenges that many Africans face. They were confronted with supply issues from vendors, caused by problems such as inconsistency of electricity, so they are adapting their business model to include trusted, shared spaces where artisans can create and collaborate.

Mahugu knows the struggle many women face coming from traditional backgrounds, having less access to education, and to the outside world. She is committed to rebalancing gender inequalities and believes that “when one woman helps another, amazing things can happen.” She is a role model to young women, particularly in the tech-world. When she was expanding her business, and receiving no applications from women for the technology roles, she realized something had to be done to appeal to women like herself. She explained that the gender imbalance in the tech industry was “a harsh reality that dawned on me, and that we still need more women in technology and collaboratively need to promote this awareness.” Social enterprise and IT seem to be a winning combination for Mahugu, and her commitment to social justice and interest in empowering other women in the tech-world make her a person worth keeping an eye on.

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South African Firms Look to Invest in Greater Africa

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House of coins

South African real-estate investors are looking for high returns in the African market, despite the myriad challenges of investing within the continent.

South Africa is, in some ways, akin to the neighborhood misfit: its historical and contemporary socio-economic environment, such as world class universities and medical schools, a fabulously lucrative niche safari sector and a diverse population set it apart from its regional and continental neighbors. As the non-African international community begins to increase its interest in Africa’s property market, so too are South African property developers. During a recent South African Property Owners Association (SAPOA) Convention, speakers suggested that property markets around the continent are ripe for investment.

Research, Research, Research

At the Johannesburg Sandton Convention Centre, speakers suggested that investors need to treat African property markets with respect: not only do investors need to know their individual markets, but they need to treat the African market as a long game, just like the American, Asian and European markets are treated. Bronwyn Corbett, head of Mara Delta investment group, the only pan-African listed fund, urged investors to see the trees within the forest: “each African country is different. Each is a challenge, and it wouldn’t be worth doing this if it wasn’t a challenge.”

Speakers meeting at the Johannesburg Sandton Convention Centre

Speakers meeting at the Johannesburg Sandton Convention Centre

That kind of optimism may be the key to successful investment choices. Property investment is full of obstacles regardless of the location but, speakers noted, Africa has some obstacles that may prove larger than in other markets further afield.

Getting a Bang for your Buck

Among the top cited concerns, some are universal and some are uniquely African. Volatile political climates, rapidly fluctuating currencies and changing rules and regulations surrounding the real estate markets were just a few of the concerns discussed by Corbett. “I appreciate that investors want us to make good deals. We are starting to find things but we have to learn as we go along. Many South African investors don’t actually know what happens on the ground in Africa and may expect things to happen more quickly,” Corbett said.
What happens “on the ground” in Africa is, Corbett insinuates, very different from what happens in the realm of South African investors. Deal brokering and relationships are very different for the elite of South Africa. These individuals entrust their capital to firms like Mara Delta to avoid the nitty-gritty of the day-to-day wheeling and dealing required to obtain high quality assets in Africa and elsewhere. Corbett cautions that it is the firm’s responsibility to have an understanding of the potential obstacles in African markets outside of South Africa. Their customers cannot be expected to have an understanding of property markets and thus, investment funds must do their homework into each potential investment market.

Mara Delta, a substantially black-owned and primarily black-managed investment firm with properties on the Johannesburg stock exchange since 2012, has an impressively broad portfolio that includes private and industrial properties in Morocco, Mozambique, Zambia, Mauritius, Kenya and Nigeria. With this geographically diverse set of investments, Mara Delta is a reliable advisor for potential investors. Corbett touched upon perhaps the primary concern for future international investors: the currency market. There are more than 40 different currencies used in Africa, and extracting funds from these countries can take time, both due to the exchange process and due to the sluggish bureaucratic process of African banks. In addition to currency-related challenges are the limited debt and credit lines available through African banks.

Worth the Price?

Some fund managers voiced their concern that African properties are significantly more expensive when compared to more developed properties in Asia, Canada and Central and Eastern Europe. “Our research indicates that prices per square meter have been significantly higher (in Africa) than similar investments in developed markets,” said Alternative Real Estate Capital Management’s Garreth Elston.

Real estate investments are, Corbett urged, worth the trouble. She cited the South African market as a symbol of endurance even in challenging times as long as quality assets are purchased, for the right price. Given the uncertainty of the global economy in light of Britain’s imminent exit from the European Union, real estate may once again become the safest bet.

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Caixabank bid for Banco BPI hits new snag as vote on rights cap delayed

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PORTO, Portugal (Reuters) – A meeting of shareholders in Portugal’s Banco BPI, that started on Friday and was expected to lift a 20 percent limit on voting rights, was suspended until September due to a legal injunction, in a new snag for a takeover bid by Spain’s Caixabank.

The bid is opposed by the bank’s No. 2 shareholder, Angolan investor Isabel dos Santos, the daughter of Angola’s president. Caixabank has said its bid hinges on the scrapping of the voting rights limit, which has so far allowed dos Santos to fend off its attempts to control the country’s third-largest lender.

Chairman of the BPI board Artur Santos Silva said the injunction blocked the vote due to a minor procedural issue, which Santos Silva expected to be resolved by Tuesday.

He said Caixabank had then proposed to postpone the meeting for 45 days, which shareholders approved. Portugal’s market regulator CMVM had suspended trading in BPI shares on Friday awaiting the result of the vote.

“I am very sorry about this situation … which is hard to understand,” he said, adding the injunction was based on the fact that the minutes of the board meeting that set Friday’s vote had lacked a formal seal of approval. “On Tuesday this problem will disappear,” he said.

He did not name the shareholder who launched the injunction, but shareholders at the meeting said Portuguese shareholder Violas Ferreira, who has a 2.7 percent stake in BPI, had presented it.

Thanks to a government decree in April aimed at putting an end to voting right limits in the banking sector, Caixabank would have voted with its full 45 percent stake in BPI to lift the cap. The motion requires a two-thirds majority to pass.

In April, Caixabank launched a takeover bid for the lender, offering 1.113 euros per share, less than its initial offer of 1.329 euros, which dos Santos fended off last year.

Dos Santos has already said the price is too low and wants an independent auditor to fix a minimum price for BPI shares, above the current offer. She has also accused the government of making an “unprecedented and clearly partial” decision in changing the law on rights limits.

But BPI’s board has called the new offer “opportune and friendly”, if low. It said an eventual takeover should help resolve the problem of BPI’s excessive exposure to risky Angolan assets and better prepare the lender to meet growing capital requirements from regulators.

BPI, which draws most of its profit from Angola, has been affected by a change in European rules that classify all exposure to the African country as risky and to be fully provisioned for, significantly reducing BPI’s solvency ratios. It has to cut the exposure and comply soon or pay hefty fines.

 

(Reporting By Sergio Goncalves, writing by Andrei Khalip, editing by Axel Bugge and Susan Thomas)

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Koffi Djondo – the Togolese entrepreneur, driven by pan-African ideals

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Koffi Djondo

Koffi Djondo is one of Togo’s most successful businessmen, but success for Africa is his ultimate goal.

Koffi Djondo may not be a name that is familiar to a lot of people outside of Togo, but Djondo is a businessman who has had huge influence on Africa’s economic landscape. As the co-founder of EcoBank and Asky Airlines, Djondo has established not just successful businesses, but enterprises that look to foster pan-African principles.

A difficult beginning

Koffi Djondo was born in a small Togolese village on July 4th, 1934. Djondo recalls a childhood characterized by extremely strict parents who eventually separated. Although Djondo does not recall his early years with much fondness, as an only child he developed a sense of self-reliance that he took into his studies.

However, even Djondo’s university education was beset with difficulties due to the politics of Togo at the time. While studying a degree in Accounting at the Institute of Social Sciences, Labor University of Law and Economics of Paris, the Togolese government contacted French authorities to ensure that Djondo was expelled from the university. This was a personal vendetta against the Djondo family, as Koffi’s uncle, Nicolas Djondo, was an outspoken critic of the Togolese regime.

Despite this setback, after a coup in Togo saw regime change, Djondo managed to return to France and complete his education. Djondo began working for the airline UTA, before moving into newly established government roles. In 1964, Djondo was appointed as the executive director of a government body – Family Allowances Fund – where he was responsible for the introduction of a mandatory retirement age and pensions. By 1973, Djondo was chairman of the Economic & Social Council, and only two years later he was elected as the president of the Chamber of Commerce and Industry of Togo.

A meeting of minds

As Djondo’s government career progressed, he eventually found himself as the President of the Federation of West African Chambers of Commerce. It was here that Djondo met his Nigerian business partner, Adeymi Lawson, and the birth of a business dream was realized.

With the help of the entrepreneur, Henry Fajemirokun, Djondo and Lawson created the first pan-African bank, EcoBank, in 1985. The goal was not simply to create a prosperous business, but to create jobs across the continent, and to imbue young Africans with a sense of opportunity and pride.

Koffi Djondo

EcoBank is now present in 33 African nations, employs over 18,000 Africans, and had a turnover of $2.3 billion in 2013. The bank has offices from London to Beijing, and Djondo feels that its success is linked to his ethos of pan-Africanism, explaining, “You can notice that African strength lies in unity; what we can call togetherness… It was this which gave success.”

EcoBank’s spirit of empowering young Africans was something that the men behind it felt was important, as it made employees “feel that their purpose was more than just making money.” The bank’s hiring policy was to find people with a “passion to make a difference in Africa.”

Renewed goals for a new century

Koffi Djondo continued making moves to invest in new ventures as the 21st century began, as he looked to create an airline that matched the philosophy of his African owned bank. His dream led to the creation of Asky Airlines in 2010, and in 2011 its first commercial flights began. While the inaugural flights often had only 10 passengers on them, by 2014 they were flying 8000 passengers a week, with an 80% occupancy rate on their flights.

Asky won the award for the “Best African Company of the Year” at the prestigious African CEO Forum Awards, and the company employs over 250 people. Djondo believes strongly in the need for greater integration between African nations, saying “Integration of the continent is the only way by which Africa will find its safety, through a common regional market.”

Asky is a company founded on the concept of integration, and Djondo sees transport as key to wider African cooperation, explaining, “pan-Africanism and integration starts with people moving…If we want to make business…we have to create the appropriate means to make things move.”

Djondo is held in such reverence by many Togolese that the village of his birth has been renamed Djondo-Condji in his honor. The man himself now lives in a village he built, Djondo Kope, but he is not relaxing in retirement. Djondo plans to expand Asky Airlines, and Ecobank grew 14% in 2014. It’s a busy life for Togo’s most successful octogenarian.

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Mauritius’ trade deficit widens 22.1% in May

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PORT LOUIS (Reuters) – Mauritius said on Friday its trade deficit widened 22.1 percent to 6.91 billion rupees ($195.47 million) in May from the same period a year earlier, hit by a dip in exports of machinery and transport equipment.

The Indian Ocean island nation’s earnings from exports fell 6.5 percent from a year before to 7.46 billion rupees in May, the government’s statistics office said in a statement. The United States was the main destination for Mauritius’s exports, followed by France and Britain.

Foreign sales of machinery and transport equipment declined to 687 million rupees in May from 1.19 billion rupees in the same period last year.

Total imports rose 5.4 percent from a year before to 14.37 billion rupees in May. Some 20.3 percent of imports in the period came from China.

 

($1 = 35.3500 Mauritius rupees)

 

(Reporting by Jean Paul Arouff; Editing by Elias Biryabarema and Catherine Evans)

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Kenya Airways says full-year pretax loss narrows 12%

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NAIROBI (Reuters) – Kenya Airways Ltd narrowed its pretax loss by 12.2 percent to 26.1 billion shillings ($257 million) in the year to end-March, it said on Thursday.

The carrier, which is part-owned by Air France KLM, has been reducing its fleet, selling land and cutting jobs to recover from losses caused by a slump in tourism and the cost of renewing its fleet.

Finance director Dick Murianki said the airline, which says it ferries 11,500 passengers a day, reduced its operating loss by 75 percent.

Gross profit rose 42 percent and the operating loss shrank to 4.1 billion shillings.

“We have taxied and we are aligned for take-off,” he told an investor briefing.

Passengers numbers rose to 4.23 million from 4.18 million as the proportion of occupied seats, the “cabin factor”, rose 5 percent to 68.3 percent.

However, a firmer dollar against the shilling during the year, higher financing costs and fuel hedging losses offset the impact of higher revenue, the airline said.

Chief Executive Mbuvi Ngunze said they were raising funds to support the airline’s recovery. He did not give details.

He said the main risk facing the carrier was uncertainty around Kenya’s presidential election, set for August 2017.

The airline’s shares fell 10 percent to 4.25 shillings midway through the session, after the results were released.

 

($1 = 101.4000 Kenyan shillings)

 

(Reporting by Duncan Miriri; Editing by Ruth Pitchford)

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