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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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South Africa’s rand halts rally, GDP data, Fitch review keep market wary

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

JOHANNESBURG (Reuters) – The rand pulled back from the previous session’s four-week highs against the dollar on Wednesday and traders said South African GDP data expected to show a small contraction in the first quarter could add pressure on the currency.

The rand has gained as much as 5 percent against the dollar since Friday, reaching 14.7995 on Tuesday in a relief rally prompted by S&P’s decision to maintain South Africa’s investment grade BBB- rating.

The currency however gave back some of those gains on Wednesday to trade at 14.9175/dollar by 0650 GMT, down 0.1 percent from the previous session’s close.

Traders saw a risk to the currency from Statistics South Africa’s GDP data due out at 0930 GMT, with economists polled by Reuters expecting the economy to have shrunk 0.1 percent on a quarter-on-quarter annualised basis in the first three months of the year.

“If this is indeed the case there is not much chance the rand will be able to continue its journey lower (firmer),” Standard Bank trader Warrick Butler said in a note to clients.

Another rand-moving headline could be a review from Fitch, which is also expected to retain its own BBB- rating on Africa’s most industrialised economy, although it could change the outlook to negative from stable.

Fitch has not set a date for its announcement, but the Treasury has said it expects it on June 8.

In fixed income on Wednesday, the yield on debt maturing in 2026 was flat at 9.1 percent.

The JSE securities exchange’s Top-40 futures index was down 0.4 percent, pointing to a slightly weak start for the local bourse at 0700 GMT.

 

(Reporting by Stella Mapenzauswa; Editing by Ed Stoddard)

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South Africa’s Telkom agrees performance-based pay deal with unions

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

JOHANNESBURG (Reuters) – South African fixed line telecoms network operator Telkom has reached a performance-based pay deal with two of it three largest labour unions while agreeing not to cut jobs for two years, the company said on Tuesday.

Telkom, reported a 15 percent rise in full-year profits on Monday after completing a three-year restructuring as it adapts the business to slowing revenue from fixed-line telephony and a sharp increase in data traffic.

The firm said on Tuesday it had signed a deal with Solidarity and the South African Communications Union to implement a performance-based remuneration scheme for both individual employees and teams. A third union, the Communications Workers Union, has agreed in principle, Telkom said.

“The agreement covers Telkom’s 11,000 unionised employees, out of a total headcount of just over 13,500 at the end of March 2016,” Telkom said in a statement.

As part of the deal, Telkom committed to no compulsory job cuts for the next two years and limiting outsourcing moves to less than 1,000 employees over the same period.

Telkom, in which the government owns a stake of about 40 percent, said it would not be offering any employee an annual increase in pay this year but was willing to pay workers more if they reached certain targets.

“The company is offering employees the opportunity to earn up to 12 percent more each month should they meet and exceed sales and customer service targets,” Telkom said.

 

(Reporting by TJ Strydom; Editing by James Macharia, Greg Mahlich)

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Swiss and UK watchdogs quiz Credit Suisse over Mozambique loans

7 June 2016 Comments (0) Africa, Business

ZURICH (Reuters) – Switzerland’s financial watchdog said it is in touch with Credit Suisse over Mozambique’s undeclared loans, while Britain’s regulator is also making inquiries, according to a source familiar with the situation.

In April, Mozambique, one of the world’s poorest countries, disclosed as much as $1.35 billion of sovereign borrowing that may have made its debt unsustainable.

Swiss bank Credit Suisse and Russia’s VTB have been active in Mozambique, arranging loans for state-owned firms as well as helping with a eurobond issue.

A spokesman for Swiss financial watchdog FINMA told Reuters on Tuesday it was in contact with Credit Suisse over its engagement with the sub-Saharan African nation.

“We are aware of the issue and are in contact with the bank over this matter,” he said on Tuesday, declining to give any further details.

Separately, a source told Reuters on Monday that the UK’s Financial Conduct Authority (FCA), was looking into the role both Credit Suisse and VTB played.

Credit Suisse declined comment.

VTB said it had been open and transparent with the regulator on the Mozambique transaction and was not aware of any investigations.

“As we previously said, the total public debt number disclosed in the prospectus of the issued sovereign eurobond was inclusive of all outstanding direct and publicly guaranteed government debt, as confirmed to us by Ministry of Finance of Mozambique,” the Russian bank said.

Mozambique’s foreign debt – including $2 billion of commercial borrowing arranged without consulting parliament as required – has ballooned in the last four years, largely due to expectations it was set to become a major natural gas producer.

However, those expectations are now being shown to be wildly premature, leaving the country with a foreign debt burden equal to $400 per head – only a fraction below the International Monetary Fund’s $435 annual per capita GDP estimate.

 

(Reporting by Joshua Franklin and Oliver Hirt in Zurich, Alexander Winning in Moscow and Ed Cropley in Luanda; Editing by Michael Shields and Alexander Smith)

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Kenya’s tourism earnings fall 3 pct in 2015

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

NAIROBI (Reuters) – Kenya’s revenue from its tourism sector dropped 2.87 percent last year to 84.6 billion shillings ($837.21 million), its tourism minister said.

Visitor numbers and earnings have plunged in the past four years as al Shabaab militants from neighbouring Somalia launched attacks on Kenyan soil in retaliation for Kenya’s military intervention.

Showing the depth of the fall, tourist arrivals fell from 1.8 million in 2011 to 1.18 million last year. The country earned 98.9 billion shillings in 2011 compared with the 84.6 billion shillings last year.

Najib Balala said the sector was on course for a recovery in 2018, in line with government plans, but cautioned that violent protests against the country’s electoral body could curb arrivals.

“A lot of people I meet are saying Kenya is maturing but when they see the incidents of the last weeks, they say we are going backwards,” he told Reuters on Monday.

“My concern is that, the efforts and the road map is working very well, I don’t want the political noise to interrupt that programme.”

Tourism is one of the main hard currency earners for Kenya.

President Uhuru Kenyatta’s government wants to bring in 3 million visitors a year according to its manifesto when it was elected in early 2013.

Efforts to revive the sector include boosting security, opening new source markets such as Nigeria and Poland and increased budgetary allocations to the sector.

Visitors are expected to rise by a third this year to 1.6 million and to recover to 1.8 million in 2018, matching a record high set in 2011.

($1 = 101.0500 Kenyan shillings)

 

(Reporting by John Ndiso; Writing by Duncan Miriri; Editing by Alison Williams)

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Fitch may keep South Africa rating but cut outlook, analysts say

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

JOHANNESBURG (Reuters) – Ratings agency Fitch is likely to affirm South Africa’s investment grade credit rating this week but may lower its outlook to negative, analysts said, as Africa’s most industrialised economy grapples with slow growth.

South Africa has dodged downgrades from S&P Global Ratings and Moody’s, taking some pressure off President Jacob Zuma ahead of elections in August and giving policymakers more time to implement reforms to boost GDP growth.

Fitch, which rates South Africa one step above speculative grade with a stable outlook, has not said when it will publish its review. The Treasury has said it expects the review on June 8.

“We expect Fitch to affirm the rating at BBB- but change the outlook to negative, bringing them in line with S&P,” Rand Merchant Bank analyst John Cairns said.

“The announcement will be a small negative and will not fully offset the positive news from S&P.”

Three other analysts Reuters spoke to expected much the same result.

S&P said on Friday it was sticking to its BBB- rating on South Africa, one notch above non-investment grade. But it warned that its negative outlook reflected the potential adverse consequences of low GDP growth. Last month, Moody’s kept its rating at Baa2.

The rand and government bonds jumped after the S&P review, with the currency trading 0.3 percent firmer, while the benchmark bond due in 2026 and the country’s dollar-denominated bonds firmed.

Rating agencies had warned of possible cuts to South Africa’s credit standing after Zuma rattled investors by changing finance ministers twice in less than a week in December, triggering a cross-asset selloff.

In its last review, released on Dec. 4, before Zuma swapped his finance ministers, Fitch had said it expected South Africa’s economy to grow by 1.7 percent this year.

But the economy has taken a turn for the worse after scandals surrounding Zuma and a severe drought that has hit agricultural output and worsened inflation.

The Treasury currently expects GDP growth of less than 1 percent this year.

Zuma has faced calls to resign following a Constitutional Court ruling in March that he had erred by refusing to refund the state for renovation work on his house paid for by the taxpayer.

“There is always a chance that they (Fitch) change the ‘stable’ outlook on their BBB- rating to ‘negative’, although this is not a given just yet,” said Standard Chartered’s head of Africa research, Razia Khan.

“Having just downgraded South Africa and assigned the stable outlook to the rating last December, they too could give it another six months or longer before changing the outlook.”

Analysts say a downgrade to “junk” status could be on the cards later this year if policy measures did not turn around an ailing economy.

“Fitch’s decision to hold the rating outlook at stable or to adjust the outlook to negative has valid arguments on both sides, and will therefore be a very close call,” NKC African Economics’ Hanns Spangenberg said.

“However, given the deterioration in South Africa’s economic growth outlook, as well as an uptick in political risk over the last few months, our view is that the correct decision for Fitch would be to adjust South Africa’s rating outlook to negative.”

 

(By Olivia Kumwenda-Mtambo. Editing by James Macharia and Hugh Lawson)

 

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King of Soto: Benin’s answer to Caribbean rum?

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

king of soto

Entrepreneur Mabel Adekambi creates King of Soto, a new take on a traditional liquor that is growing in popularity.

Inspired by a tradition of fine palm wine produced in her native Benin, entrepreneur Mabel Adekambi in 2014 launched King of Soto, a high quality rum produced entirely with local ingredients.

“When we say ‘rum’ all over the world, we know it comes from the Caribbean. Why not have a proper product in Benin?” Adekambi asked.

Adekambi’s product comes in 10 different flavors including pineapple, orange, mango, papaya, strawberry and passion fruit. King of Soto only uses natural ingredients and no chemical additives.

Rum production begins with the harvest of sap from palm trees. Rich in yeast, it quickly ferments juice called palm wine. Then the wine is distilled to produce a liquor the Beninese call sodabi, or soto for short.

The nickname inspired the name King of Soto, rum produced from sodabi, spices and fruit.

Process takes 6-12 months

Typically, rum-makers use wooden or aluminum barrels like those used in wine making. However, Adekambi found those were not available in country and would be very expensive to order. Instead she uses 20-liter gasoline cans.

The fruit, spices and sodabi are mixed together and stored cans for six to 12 months before the rum is ready for bottling.

Because sodabi is a seasonal product, it is difficult to produce large volumes of rum. King of Soto uses sodobi that has been distilled several times in order to achieve a refined liqueur.

Adekambi learned about rum production as a student in France.

Studies in entrepreneurship

After studying entrepreneurship, communication and tourism in France, she returned to Benin to work as a manager at Residences Celine Hotel in Cotonou.

King of Soto has become popular, mostly by word of mouth. Production rose from 10 bottles a month to 100 bottles within the first year of operation. The rum is sold in super markets for less than $2.

Sodabi is common liquor in West Africa, although it goes by different names in different countries: koutoukou in Ivory Coast, Akpeteshie in Ghana or Ogogoro in Nigeria.

Each region has secret methods for extracting the palm wine, which creates a variety of tastes and styles.

In Benin, the name sodabi derives from the name of its inventor, who learned distilling techniques from Europeans about 100 years ago.

king of soto bottles

A staple of celebrations in Benin

Benin, especially the region of Adja, is well known for its expertise in producing sodabi, according to Professor Koblévi Aziadomé, former minister and director of the Benin agricultural research center.

Often sold in plastic bottles, the popular beverage is consumed at celebrations and festivals.

Some people add plants, spices or fruits in their sodabi to give it medicinal properties or special tastes.

Negative image

In the past, producers have failed to adequately ferment or distill the sodabi, giving it dangerous levels of methanol and creating a negative image. Both Benin and Ivory Coast have at times banned its production.

But Adekambi seeks high quality, well distilled sodabi to create rum that customers can safely enjoy.

Adekambi believes King of Soto will only grow as the quality and flavor of her product becomes more widely known.

She sees King of Soto as both a business and a patriotic effort as it grows into an export product and employs more people. “For the moment, it is not profitable. But it will become profitable and hundreds of families in Benin will benefit.”

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