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DR Congo slashes growth forecast for 2016 to 5.3 pct: cenbank

14 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

KINSHASA (Reuters) – The central bank of the Democratic Republic of Congo has slashed its GDP growth forecast for 2016 to 5.3 percent, compared with 6.9 percent last year, as a slump in commodity prices batters its mineral-dependent economy.

The central bank statement obtained by Reuters on Monday did not give details as to what was behind the revision. Congo has suffered from falling prices in its key mineral exports, including copper, cobalt, tin and diamonds.

Its previous estimate in April projected growth at 6.6 percent for this year, itself revised down from 9 percent earlier. The latest estimate brings it closer to the IMF forecast, currently at 4.9 percent.

Congo, Africa’s biggest copper producer, relies heavily on raw materials, which account for 98 percent of export earnings. After bouncing back at the start of the year, copper on the London metal exchange fell by a quarter last year, and has fallen further in 2016.

 

 

(Reporting by Aaron Ross; Writing by Tim Cocks; Editing by Joe Bavier)

 

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World Bank to loan Kenya $1.1 bln for northern region, bank VP says

13 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

NAIROBI (Reuters) – Kenya will get a World Bank loan of $1.1 billion for infrastructure projects in the country’s arid northern region, the bank’s vice president for Africa said.

The loan is the latest in series to Kenya, which amount to $5.5 billion, excluding the new package.

“It is an unprecedented financial commitment to this part of Kenya,” Makhtar Diop told Reuters in Nairobi over the weekend.

The funds will be used to build roads, improve water and energy supplies and support livestock keeping. They will have a maturity of 50 years and an interest rate of less than 1 percent. The package was prepared at the request of Kenyan President Uhuru Kenyatta, Diop said.

He did not say when the full disbursement of the funds would take place, but technical work on some projects has already started. Projects to be funded with the facility included a modern road linking Isiolo, a town in the lower eastern region, with Mandera, a town close to the border with Somalia.

Diop said the World Bank expected Kenya’s economy to expand by 5.9 percent this year, close to the government’s forecast of 6 percent. It grew 5.6 percent last year.

“Kenya is doing pretty well in the Africa context and in the global context, but the ambition of the government is to sustain that growth rate and accelerate it,” he said.

To attain faster growth, the country needed to increase efficiency in state-owned firms and improve competitiveness, through investments in infrastructure.

Last week, the government forecast a higher budget deficit of 9.3 percent of gross domestic product for the fiscal year starting next month as it increases public investments.

“Overall the fiscal deficit is financeable,” Diop said, adding total debt was increasing but remained sustainable at about 50 percent of GDP.

The World Bank cut its average growth forecast for sub-Saharan Africa to 2.5 percent this year because of lower commodity prices.

Diop said the continent could attract investment because of higher returns than other regions of the world, but he said some African nations needed to avoid building up their dollar-denominated debt.

 

 

(By Duncan Miriri. Editing by Larry King)

 

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Moroccan leased farmland attract $1.4 billion investment in 2015

13 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

RABAT (Reuters) – Private investments in Moroccan state-owned land leased to farmers and investors have reached 14 billion dirhams ($1.4 billion) at the end of 2015, a statement from the agriculture ministry said on Monday.

To attract foreign and local investors, the kingdom has been leasing farmland for 20 to 50 percent of its market value on long-term contracts of up to 40 years.

Morocco holds regular tenders as suitable state farmlands are gradually identified and made available.

About 111,000 hectares have been allocated in the last two years, the statement said, and the target is 500,000 hectares by 2020. Total farmland is estimated at about 7.8 million hectares.

Like other North African countries, Morocco is trying to modernise its farms to improve food security and avert the kind of price rises that contributed to popular unrest in Arab countries in 2011.

However, the North African kingdom still remains one of the World’s biggest wheat importers with volumes depending on local harvest.

The amount of investment attracted is 92 percent of the 15.2 billion targeted when the government stepped up the leasing programme to increase production and speed up modernisation of Moroccan farming in 2014.

The 14 billion dirhams investments include 4.7 billion dirhams in developing and equipping farmlands in general, 2.2 billion dirhams in vegetal production and 1 billion dirhams for breeding, the statement carried by the state news agency MAP said.

Morocco is expected to harvest a cereal crop of 3.35 million tonnes this year, down 70 percent from last season’s record 11 million tonnes after severe drought.

Rainfall was 43 percent less than an average year and 45.5 percent less than last season, which makes this the worst season in 30 years, with 98 dry days between November and February.

($1 = 9.6892 Moroccan dirham)

 

(Reporting By Aziz El Yaakoubi; Editing by Keith Weir)

 

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MTN settles Nigeria dispute, looks at local listing

10 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

ABUJA (Reuters) – MTN Group has agreed to pay a reduced fine of 330 billion naira ($1.7 billion) in a settlement with the Nigerian government of a long-running dispute over unregistered SIM cards, sending shares in the South African telecoms group soaring.

The settlement clears the way for MTN to list its local unit on the Nigerian Stock Exchange. Such a step had been on the firm’s radar but plans accelerated during negotiations over the fine, Executive Chairman Phuthuma Nhleko told Reuters.

The fine will be paid by MTN Nigeria over three years and is only around a third of the $5.2 billion figure initially demanded by the west African country last October for failing to deactivate more than five million unregistered SIM cards.

Nigeria has been cracking down on unregistered SIM cards, concerned they are used for criminal activity in a country fighting an insurgency by Islamist militant group Boko Haram.

MTN had threatened to pull out of Nigeria as paying the fine in full would have crippled its local operations, a government official said, asking not to be named.

“The present administration does not want to ground the operations of any investor in Nigeria,” he said.

Nigeria, Africa’s largest economy and most populous nation, faces its worst crisis for decades after the sharp fall in oil prices and last year’s introduction of a currency peg that put investors to flight.

But in a possible complication, Nigeria’s House of Representatives said it was surprised by the deal as its own probe into the MTN fine had not been concluded.

In March, the lower house launched an investigation, arguing that reducing the initial fine of $5.2 billion would require changing the law.

“We are still continuing with our investigation,” Fijabi Akinade, chairman of the House’s committee on communications, told Reuters. Lawmakers had summoned the communications minister and a top regulator official to discuss the deal on Monday.

“We want to know how they arrived at that decision and if it was done in good faith … But honestly, we are surprised,” Akinade told Reuters.

The dispute removed a cloud hanging over MTN and its shares surged more than 20 percent at one point and closed 13.18 percent higher at 140 rand. They had shed 22 percent since the fine was first announced.

“The relationship between MTN, the Federal Government of Nigeria and the Nigerian Communication Commission (NCC) has been restored and strengthened,” Nhleko said.

The Nigerian regulator said the settlement was acceptable to both parties and that it had not been “out to kill MTN”.

“Money was not the issue here. The breach was the issue. I believe MTN has learned its lesson,” NCC spokesman Tony Ojobo told Reuters.

 

MAJOR MARKET

MTN is the largest mobile phone operator in Nigeria with 62 million subscribers and the west African nation accounts for about one third of its revenues.

Nhleko, who was chief executive for nine years until 2011, was appointed on an interim basis for six months in November but has stayed on as the company negotiated with Nigerian authorities.

In February, MTN hired Eric Holder, the former U.S. attorney-general, to help negotiate the fine.

MTN, Africa’s largest telecoms company, has already paid 50 billion of the 330 billion naira owed. The rest will be paid in six instalments over three years, the company said.

Five weeks after the fine was first announced, MTN’s chief executive Sifiso Dabengwa resigned and the company asked Nhleko to take the reins temporarily.

A Johannesburg-based analyst gave Nhleko credit for not settling the fine earlier at a figure of $3.9 billion, the first sign Nigerian authorities gave after months of talks that it was willing to accept a lower sum.

“He’s the guy who built this ship and this shows he can still steer the ship,” Momentum SP Reid Securities analyst Sibonginkosi Nyanga told Reuters.

The telecommunications firm which spans 20 countries, set aside $600 million in March to pay the fine.($1 = 198.0000 naira)

 

(By Zandi Shabalala and Camillus Eboh. Additional reporting by Alexis Akwagyiram and Camillus Eboh in Lagos; Editing by Keith Weir and Mark Potter)

 

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Yeelenpix – the African startup changing the way Africa is seen

10 June 2016 Comments (0) Africa, Business, Featured

yeelenpix

Yeelenpix is the startup company selling images of Africa that reflect the continent’s diversity.

Yeelenpix is a company in its infancy, having only been launched in 2013, but it aims to broaden the way that Africa is presented in pictures. Asking someone to pick an image that represents a vast continent would be impossible, and the team behind Yeelenpix felt that the images available were too limited.

From the Pyramids of Egypt to iconic wildlife on safaris, there are images that are distinctly African, but whole areas of African life, trade and experiences had little documentation. Yeelenpix founder Moussa Fofana felt that this was problematic, not just for how the continent was seen by the rest of the world, but for businesses in Africa who needed stock images for marketing.

Fofana elaborated on the catalyst for starting up his company saying, “It all started with a remark made to me one day, by a friend who works in communications in Abidjan…she had to go and buy images on the western platforms to illustrate papers for her African clients, without the benefit of African images that are at hand.”

Moussa Fofana

Moussa Fofana

Fofana set up the company with his close friends Alex Poblah and Maguette Mbow, who were living in Paris at the same time as Fofana. Fofana is from the Ivory Coast, and the word “yeelen” actually means “light” in his native language of Dioula.

An African database

With a gap in the market identified, the three friends set up Yeelenpix, and immediately looked to source additional funding. However, thus far the company has been entirely self-funded as, according to Fofana, “The private equity firm with whom we were negotiating in Paris has proved too greedy.”

This setback did not stop the company from having early success. Yeelenpix quickly built up a large cache of over 10,000 images from across Africa, and they currently have a network of 50 professional photographers providing them with photographs. In addition to providing employment opportunities for African photographers, Yeelenpix also works with British and French photographers who spend extensive time on the continent.

Within 2 years of their launch, Yeelenpix’s clients include the TV station Africa 24, and Morocco’s Chaabi Bank. The range of images is set to grow, as Fofana has stated they aim to have 100 professionals working for them within a year, and they are also happy to work with amateurs if the quality of their work is good enough. If a company needs images of rice farming in Nigeria, or the cotton industry in Mali, then Yeelenpix can provide the pictures needed to create promotional brochures.

By accepting work from amateurs, Yeelenpix is not only providing work opportunities for aspiring photographers, but it is increasing the range of its reach. Areas of life that might not have attracted professionals become accessible, and countries with less status (than some of Africa’s most famous destinations) get greater opportunities for exposure.

Fofana explained the company ethos on utilizing talented amateurs saying, “They can express their vision of Africa and the market. Young people who are not yet professional contact us, word of mouth starts working.”

Democratizing the process of how the continent is represented puts at least some of the power into the hands of the people, who live and work in the nations being portrayed.

Affordable Accessibility

Yeelenpix operates a flexible price structure to allow as great a number of organizations as possible to access their database, and use their images. On average, it costs $22 to use a Yeelenpix image for a website, with a commission rate of 35% to 60% of sales paid to the photographer.

There are additional fees for companies wishing to use an image on printed materials, but pricing structures are negotiable, thus allowing smaller clients to still benefit from the wide stock of images available at the Yeelenpix website. The images are also hosted in various categories to help clients filter out images that are not relevant to their needs.

Fofana and his team want Yeelenpix to create jobs, but also to inspire pride in showcasing Africa in new ways. Talking about what drives his team Fofana sums it up saying, “We wanted to participate in the dissemination of a new image of Africa. Africa is changing and evolving. (We want to) enable African photographers to become better known and live their art.”

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Kenya’s Safaricom to launch local rival to Uber

9 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

NAIROBI (Reuters) – Kenya’s biggest telecoms company Safaricom is joining up with a local software firm to launch a ride-hailing company to take on Uber [UBER.UL] as it seeks new sources of revenue, its chief executive said.

Safaricom, which is 40 percent owned by Britain’s Vodafone, and Nairobi-based software developer Craft Silicon will launch the app called Littlecabs in the next three weeks, Safaricom CEO Bob Collymore told Reuters in an interview.

“It is effectively a rival for Uber,” he said. “It is a local competitor which will be cheaper and better for the local community.”

Uber operates in several African countries, including Kenya where it launched in early 2015, drawing customers by offering lower prices and cutting out haggling over fares. But regular taxi drivers have complained about its impact on business.

In March, the Kenyan authorities charged six men with attempted murder and malicious damage to property over an attack on an Uber taxi driver in February. [nL5N1713UX]

Safaricom will help develop the application, offer the network connectivity, put Wi-Fi in vehicles that will be signed up on Littlecabs, and use its mobile-phone based financial service M-Pesa to process payments, Collymore said.

Safaricom remains focused on its core businesses of offering calls, texts, Internet access and M-pesa but Collymore said it was seeking new sources of revenue.

“The direction of the company is to become a platform,” he said, citing partnerships with local banks that use M-pesa to lend money on mobile phones.

Safaricom has had a three-year partnership with M-Kopa, a company that connects customers to solar electricity, and is about to invest in a firm involved in education and another that helps jobseekers, Collymore said.

“When M-Pesa was launched it wasn’t launched as a big thing. It was just launched as a thing that was right in the edge. Now it is 20 percent of (Safaricom’s) revenue,” he said.

Littlecabs is unlikely to grow to that level but would offer a new revenue source and develop skills in the local community, he said.

Safaricom expects its earnings to rise in the financial year to next March on the back of increased data usage driven by the youth segment and higher sales of smart phones. [nL5N188101]

Revenue from calls rose 4 percent in the financial year ending March 2016, bucking the trend in other markets where voice revenues are falling.

Collymore said political protests, which have led to clashes between demonstrators and police, could dampen the outlook.

“It is not a question of who is right and who is wrong; these pictures are not helpful for investments,” he said.

 

(By Duncan Miriri. Editing by Edmund Blair and Susan Fenton)

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Elumelu Foundation: Entrepreneurs will lift Africa

9 June 2016 Comments (0) Africa, Business, Featured

tony Elumelu Foundation

The Nigeria-based foundation pledges $100 million to train and mentor 1,000 entrepreneurs a year for 10 years with a goal of creating one million jobs.

One thousand young African entrepreneurs will receive intensive training, mentoring and networking opportunities as participants in the 2016 Tony Elumelu Entrepreneurship Program (TEEP).

The program, launched in 2015 by the Nigerian entrepreneur and philanthropist Tony Elumelu, is designed to identify 10,000 entrepreneurs over a 10-year period and empower them to launch ventures that will create one million jobs and add $10 billion to the African economy.

The Tony Elumelu Foundation has made a $100 million commitment to the program.

More than 45,000 entrepreneurs from 54 countries applied for the 2016 program, more than double the number of applicants in the first year. The successful 1,000 candidates represent a variety of fields including agriculture, information and computer technology and fashion.

Elumelu Fondation participants

Elumelu Fondation participants

All regions represented

All five regions of the continent are represented. The largest numbers of entrepreneurs came from Nigeria, Kenya, Ghana, Uganda and Cameroon.

(Here is a list of the entrepreneurs from each country and their areas of interest.)

Elumelu predicted the 2016 group of entrepreneurs “will become a generation of empowered business owners who will show that indigenous business growth will drive Africa’s economic and social transformation.”

He said his foundation has invested $8 million in the 2015 group, including $5 million that went directly the entrepreneurs as seed capital. “The results have far exceeded our expectations,” he added. With funding and networking, the program has “helped extraordinary people take control of their destinies.”

In addition to receiving training and networking for nine months, the entrepreneurs will participate later this year in the Elumelu Entrepreneurship Forum.

Elumelu is #31 on list of Africa’s richest

Elumelu is a Nigerian entrepreneur and investor who is listed as #31 on Forbes’ list of Africa’s 50 richest people. He owns the controlling interest in Transcorp, a Nigerian conglomerate with businesses in hospitality, agriculture, oil production and power generation. Forbes puts his net worth at $700 million.

Elumelu became prominent in African business circles nearly 20 years ago, when he persuaded investors to take over a small, failing commercial bank in Lagos and turned it around and made it profitable within a few years. It later merged with United Bank for Africa, which has subsidiaries in 20 countries as well as the United States and the United Kingdom.

According to his profile on Forbes, he also has a stake in the mobile telecom MTN Nigeria and owns extensive real estate across the country.

Entrepreneurs will drive growth

As many African nations work to diversify their economies and move from resource-based revenue to manufacturing and services, entrepreneurship is considered an important way to drive economic growth.

While the continent is already seeing returns, experts say entrepreneurship holds untapped potential to drive economic development to the next level.

A 2014 study ranked Uganda as the most entrepreneurial country in the world and listed Cameroon, Angola, Botswana and Burkina Faso among the top fifteen.

The study, by Global Entrepreneurship Monitor, counted the percentage of the adult population that owned a business and paid wages for at least three months. In Uganda, the percentage was 28 percent. (Suriname in South America was the least entrepreneurial in the world with less than one percent.)

African Development Bank pushes employment

Akinwumi Adesina, president of the African Development Bank, recently reaffirmed the lender’s commitment to entrepreneurship as it seeks to promote a sense of urgency about youth employment on the continent.

In Africa 10-12 million young people enter the workforce each year but only three million jobs are created annually. Even when there are jobs, young people often lack the skills employers required.

“We need a sense of urgency for tackling unemployment,” Adesina said, noting that the bank has created a strategy that could create 25 million jobs for young people on the continent. These programs focus on agriculture, manufacturing, and information and computer technology. The bank will also index youth employment and track the labor market over time.

“The skill sets and the jobs of the future are digital. The world is changing fast,” Adesina said.

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Rwanda says eyeing $200 mln worth of short-term facility from IMF

9 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

KIGALI (Reuters) – Rwanda said on Wednesday it had asked the International Monetary Fund to offer it a short term facility worth $200 million to help fend off foreign exchange risks in case the country’s reserves dwindled.

The central African state has previously said it had approached the IMF for help but had not revealed the amount involved.

“The IMF facility is actually to help us not going into problems and that facility is $200 million,” Finance Minister Claver Gatere said at a post-budget press briefing in the capital Kigali.

Gatere said Rwandan authorities expected the IMF to announce a decision on their request “tonight” (Wednesday).

In the budget speech, Gatere said Rwanda’s overall expenditure in 2016/17 fiscal year would rise to 1.95 trillion francs ($2.60 billion) from 1.81 trillion francs in the year ending this June.

 

(Reporting by Clement Uwiringiyimana; editing by Elias Biryabarema/Mark Heinrich)

 

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South Africa’s Transnet transports monthly record of manganese

8 June 2016 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South Africa’s Transnet Freight Rail moved a record number of manganese shipments in May due to new trains and improved market conditions, the company said on Wednesday.

Transnet Freight moved 1.053 million tons in May from a previous high of 976,671 tons in October 2015.

“The record-breaking performance is due to a significant improvement in efficiencies across the channels which were driven by the introduction of new locomotives among other things,” Transnet Freight Rail said in a statement.

State-owned Transnet plans to spend up to 390 billion rand ($26 billion) over ten years to expand and revamp railways, pipelines and ports in Africa’s most advanced economy, which is struggling with flagging growth.

More than 75 percent of the new locomotive railway fleet is used to move manganese, used as a component to keep steel from rusting. The company also moves coal, chrome and iron ore.

The company also said there was “an upturn in market conditions”. A company spokesman said the company able to move more volumes from mining companies.

($1 = 14.9650 rand)

 

(Reporting by Zandi Shabalala, editing by Louise Heavens)

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The African body SABER looks to revolutionize energy in Africa

8 June 2016 Comments (0) Africa, Business, Featured

SABER

Since 2009, SABER has been working to change the nature of energy within Africa.

Energy is at the very core of how economies and societies develop, and yet the sources of energy have become huge issues in recent years. Every developed nation in the world fueled its economic growth off the back of fossil fuels, but as finite resources dwindle, nations are looking for more sustainable means of energy.

In developing regions of the world this is an issue that relates to more than just growth, but also to the well-being of its citizens. The pollution caused by traditional fuels often affects the poorest people the most, and as urban centers become the financial heart of emerging markets, the need for greener energy has become increasingly stark.

The African group SABER is a prime example of people taking the initiative to change the face of energy within their markets.

What is SABER?

The African Society of BioFuels and Renewable Energies (ABREC/SABER) was established in 2009, to work towards creating cleaner and more sustainable sources of energy in Africa. The body is a public-private partnership (PPP) which is funded by 15 African nations in conjunction with various private enterprises.

SABER CEO Thierno Bocar oversees the organization’s work from its central office in the Togolese capital, Lomé.

Saber CEO Thierno Bocar

Saber CEO Thierno Bocar

SABER’s mission statement outlines how significant sustainable forms of energy will be for the emerging markets of Africa, saying, “Transitioning to clean energy is all the more demanding because energy needs are foreseen to expand considerably in Africa over the coming decades with new investment of about two thirds of existing capacity needed to keep pace with Africa’s growth.”

Although the organization is only 7 years old, it has already established a number of strong collaborative partnerships, and has turned ideas into realities. SABER was self-funded by 2012, which meant it had met its goal of being an independent advisory body to the public. In 2013, the group signed an agreement with the Committee on Economic and Monetary Union of West Africa (UEMOA), in which additional funding was allocated to move forward with several SABER projects.

Ideas turned into actions

The most notable of these projects has been the construction of solar powered street lighting across 3 African nations. Togo and Sierra Leone have both had 13,000 solar powered street lamps built, while a further 15,000 have been constructed in Benin. These developments alone are worth around $175 million of investment.

Solar energy features prominently in SABER proposals, alongside hydro-electricity and geothermal energy. These forms of energy are not only clean, but access the continent’s own resources intelligently.

CEO Thierno Bocar stated that within West Africa there were currently three areas that “have been selected: solar street lighting, rural electrification using solar kits or small-scale plants and the installation.”

However, SABER’s work is already expanding as it aims to address renewable energy needs across the continent.

Courtesy of SABER projects, there are currently solar power plants in 8 African nations, geothermal power stations in Kenya and Ethiopia, and a hydro-electric power plant in Uganda.

Continued growth

SABER has established relationships with The African Development Bank and USAID, but 2016 has seen further developments in their cooperative efforts. SABER recently announced a partnership with Oragroup that will provide further revenue for the growing number of energy projects across Africa. Oragroup wants to be known as the leading bank in Africa for fighting climate change, and Mr. Bocar described the $233 million platform as enabling “project arrangement with high added value.”

SABER’s continued growth constitutes more than its own ventures, as Bocar wants to foster environments in which local people drive change and grassroots initiatives can flourish. The plans to help build such a foundation are already in place, as SABER offers expert advice to governments, and is also striving to fund the Seeded Green African Development Fund. This structure will enable private equity to fund small-scale projects across the continent, with an initial goal of a $150 million fund over the next 10 years.

Of course, if SABER’s successes catch the imagination of others, and governments make the most of the support the organization offers, then organic growth within sustainable energy projects could well eclipse such targets. If it does then it will benefit not only Africa, but the world.

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