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Hydrogen Power in Mali

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Green power in Mali from hydrogen gas wells could power the future.

Hydrogen power refers to the use of hydrogen fuel as a zero emission fuel, since burning hydrogen with oxygen emits no carbon dioxide (only water). It sounds a bit futuristic perhaps, but the physics behind it are valid, though up until recently there have been very few practical examples. This is due to hydrogen power relying on either some kind of hydrogen fuel cell or on hydrogen gas, which until recent times, wasn’t believed to be in the earth’s crust in great quantities, nor in the earth’s atmosphere in clean or usable form.

In a new book about natural hydrogen entitled Natural Hydrogen: The Next Energy Revolution?, the the authors assert that natural hydrogen seeps or wells are abundant almost everywhere on earth and are a real viable alternative to fossil fuels. The book is written by acclaimed geologists Alain Prinzhofer and Eric Deville. With this new book it is clear that hydrogen power is no longer the technology of the future, but rather the technology of today.

In July 2015, three years after their first successful test, the Petroma Company demonstrated how hydrogen gas can be used to generate power, by lighting up part of the village of Bourakebougou not far from the capital Bamako in Mali, the eighth largest country in Africa. This has created almost 100% clean electricity in a poor rural area that did not have any access to electricity, something that would have hardly seemed plausible only a decade ago. In doing so, Petroma is not only reigniting the debate about alternative energy, it is also showing the world that even a poor African country can be innovative and turn to renewable fuels and prevent the massive pollution that comes with the fossil fuels used today.

The man behind this new venture into the field of hydrogen power is 56-year-old Aliou Boubacar Diallo, who is the president of Petroma Inc and also the leader of the Democratic Alliance for Peace. Aliou Boubacar Diallo is the driving force behind the new push for green energy in Mali, where he is a well-known player in not just politics and the energy sector, but also within gold mining and peace brokering.

HEC Feasibility Study

In the field of hydrogen engines, Petroma turned to well-known experts from the Hydrogen Energy Center in the US to perform a feasibility study. HEC is on the forefront when it comes to hydrogen energy and hydrogen power generators.

The study conducted by HEC was to check if it would be possible to harvest the hydrogen gas and use it in generators and generate at least 100 megawatts of power. Furthermore the study was to determine whether it would be better to have many small plants or one larger plant. The power would be used by local villages as well as the capital Bamako and its surrounding industries.

This study was the basis which Aliou Boubacar Diallo used to start the hydrogen power revolution in Mali. The first generator was built and demonstrated in July 2015 and will be followed by many more, as ten wells are on the way. Once those ten have been successfully installed, another almost 300 are planned in the first major phase of the project, quite possibly with more to come.

mali

Power in Mali

While Mali is a large country in terms of land size, it is a poor country with around 15 million people, of which half live below the poverty line. More than ten years ago Mali was already quite green by most standards, as half the country’s power came from the use of hydroelectricity, though only about half of the citizens could be reached by the network.

Today these numbers are not much higher, as expanding the hydroelectric capacity of the country beyond the current level is expensive and many locals are still not connected with the grid.

It was pure luck when Petroma found the hydrogen well at Bourakebougou, as they were in fact drilling to get water to the village. Instead of clean water they found almost pure hydrogen, which will continuously power the generator for as long as it lives, without exhausting the hydrogen gas. In fact, while scientists don’t fully understand this seeping hydrogen gas phenomenon, some believe it could be stable enough to last for thousands of years.

With the numerous massive and almost pure hydrogen wells already found in the country, it will perhaps be feasible to convert the country to almost exclusively to renewable green sources within a foreseeable future. This has proven almost impossible for much richer and more technologically advanced nations, as their power needs are much higher.

Time will tell if this adventure into alternative energy can deliver as much as it promises.

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Phuti Mahanyele: an inspirational black business woman

Comments (0) Africa, Featured, Leaders

Phuti Mahanyele

Phuti Mahanyele – an inspirational black business woman who believes that the poor representation of women in the boardroom of major businesses in the private sector is “not just a social injustice but an economic and business imperative”.

Phuti was born in Dobsonville, Soweto, South Africa on March 15th, 1971, however she largely grew up in the Claremont township outside Durban. Her mother died at the age of 42 in 1989 when Phuti was 17. Phuti has since acknowledged that this was a major turning point in her life as it made her for the first time realize how short life can be and why it is therefore so important to never take it for granted.

Throughout her life her parents continuously advocated the importance of education, never differentiating between their sons and Phuti and her two sisters.

Her father: a pioneer for the improvement of black education

Her father, Professor Mohale Mahanyele, was a successful business man and pioneer for the improvement of black education. Whilst the Chairman of the National Economic Education trust, he ensured that thousands of young people progressed into tertiary education. Throughout his life he refused to accept the fact that just because a child came from a home with insufficient funds to afford expensive higher education fees, they were not entitled to it. During his life he could have become one of South Africa’s richest men however he was never interested in making easy money, and instead believed in reinvesting both his money and time back into the people and places he loved.

Phuti was educated in Johannesburg until she was 17, at which point she moved to the United States where she attended Douglass College in New Brunswick, New Jersey. In 1993 she graduated with a degree in Economics and then went to De Montfort University in the United Kingdom where she obtained an MBA on “The Impact of International Trade on Black Economic Empowerment.” Her education didn’t end here because in 2008 she completed a course called “Global Leadership & Public Policy in the 21st century” at Harvard University.

Early career

Phuti’s first job was at her father’s company, National Sorghum Breweries, however whilst she admits to being very happy at this time of her life, she also confesses to feeling unfulfilled. After two failed applications she finally won an internship at Fieldstone – an investment banking firm in New York. After a difficult start, she flourished and achieved the position of Vice President before leaving 7 years later, at which time she moved back to South Africa.

Her next job, running the Project Finance Unit for the Development Bank of Southern Africa proved to be less successful and she left after only a few months. Looking back, she admits that it was a bad fit for her and not an environment she could continue to work in.

Whilst looking for other work she received a telephone call from Cyril Ramaphosa, the Chairman of a then relatively small company called “New Africa Investments” which became the Shanduka Group.

Shanduka Group

Phuti originally joined as the managing director of Shanduka Energy in 2004 and eventually went on to become the CEO of the Shanduka Group. It was whilst working there that she truly found her passion.

She has since admitted to finding Cyril so inspirational on their first meeting that she agreed to work with him even before she knew what the job and salary was.

Phuti speaks of the amazing culture and work ethic at the Shanduka group, admitting that Cyril’s astonishing humility and ability to inspire was fundamental to this. She has always felt hugely responsible and accountable to her community and working at the Shanduka Group allowed her for the first time to give something back, as the company, unlike so many others, didn’t just focus on the profit for shareholders.

 

Business pillars and key successes

Phuti adheres to 3 business pillars: understanding herself including her spiritually; understanding any issues affecting her staff, personal and professional; and ensuring she has all the information she needs at all times in order to be able to drive the business forward

When appointed CEO, her key priority was to ensure that the business moved some of its investments into areas that were less market sensitive, as she saw this as a way of ensuring the growth and security of the company’s investments in years to come. During her time at Shanduka she helped increase the company’s net asset value to approximately R8billion. Major deals driven by Phuti with Coca-Cola and McDonald’s were key to this success.

After 10 years at the Shanduka Group, Phuti has achieved a lifelong ambition and with the support of her business partner Jeremy Katzen, a highly experience banker from Johannesburg, has launched her own investment company called Sigma Capital.

Major influences on her life

Phuti often cites her family, notably her father as a major influence in her life, however she also frequently talks about the huge impact Cyril Ramaphosa has had on both her business and professional life.

Her parents taught her how to see beyond problems and challenges and to remain positive at all times. Phuti believes that every single person on earth has a purpose and that they are obligated to discover what it is and then achieve it.

Life changing experience

Whilst attending a meeting in London, in 2013 Phuti was experiencing severe headaches, however she assumed it was just due to tiredness and tension. Whilst out shopping after the meeting she fainted, it was at this time she first sought medical attention. She was told to rest and returned to South Africa the following day, however on arrival she ignored the advice and went back to work where she then fainted again. When she woke up in hospital she was surrounded by friends and family, all of whom she didn’t recognize. It was at this time that she was told that she’d actually suffered from a stroke, hence her loss of memory.

Although she has now made a full recovery, the experience has changed her. Whilst she still has her incredibly high work ethic and puts in long hours, she is now also committed to finding a better work/life balance by valuing the importance of friends and family and not just achievements. She is in fact now engaged again (having already been divorced twice), and is learning to cook and play the piano. She admits to being excited and is looking forward to being a better wife and stepmother. “I feel ready to be a wife now”, she said.

When Phuti was asked what she would most want to be remembered for she said, “for having given as much of myself as I possibly could”.

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Somalia resumes banana production, hopes to grow exports

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The banana industry is making a comeback in Somalia after two decades of war devastated its leading export.

The East African country’s fledgling effort faces significant challenges, including lack of irrigation and storage infrastructure as well as a wait-and-see attitude of potential export partners abroad who are mindful of Somalia’s recent history of violence and instability.

While most of Somalia’s current crop goes to local markets, exports have begun to Middle Eastern countries including the United Arab Emirates.

About 40,000 tons annually

Currently, Somalia has about 4,000 acres in cultivation, producing about 40,000 tons annually, according to FruitSome, a company formed by about 100 growers to market Somali bananas abroad.

The current planting is less than 14 percent of the 30,000 acres that were in cultivated when the industry was at its peak. In 1990, before the war began, Somalia was the largest banana exporter in East Africa. Banana exports accounted for about $96 million and produced Somalia’s leading source of outside income.

“Prior to 1991, Somalia was renowned for its thriving banana industry. However, insecurity, lack of inputs, and poor infrastructure, has over the last two decades led to a devastating decline and eventual collapse of banana exports,” according to the Food and Agriculture Organization of the United Nations, which is providing assistance to the Somali banana industry.

Irrigation and production infrastructure destroyed during the war

The military government of Somalia was deposed by rebels in 1991, throwing the country into chaos, especially in the south, where bananas are farmed, and in the capital of Mogadishu. During the fighting, irrigation and production infrastructure was destroyed and banana growers lost access to export markets as pirates operated off the coast of Somalia. Drought and famine exacerbated the hardships in 2011.

An internationally backed central government was installed in 2012 and the nation has slowly become more stable, although insurgents of Al-Shabab, an Al-Qaeda ally, continue to operate in Somalia.

Growers, many of whom fled to refugee camps in neighboring countries, have begun to return to farms they were forced to abandon during the violence.

Lack of refrigerated storage: another challenge

“This place was a bush a year-and-half ago. We cleared the bush and now more than hundred people work here every day,” Omar Osman, a farm manager in Afgoye, said.

“Things are calm. Thank God. Us, Somalis, we have to make use of God’s blessings. This country has everything and now it is possible to make use of the land.”

In addition to clearing brush and replanting, growers must reconstruct irrigation systems destroyed by fighting factions. Lack of refrigerated storage is another challenge.

The UN Food and Agriculture Organization (FAO) has provided direct food aid to families in Somalia as well as assistance in restoring and increasing food production, including seed and land preparation services as well as farmer training.

Turkey to help Somalia

The FAO also developed several virus-free banana varieties, and Somali growers chose one, William, that is tolerant to virus attacks and drought. The FAO began making seedlings available to growers in 2012.

Turkey has also undertaken efforts to help Somalia rebuild its agricultural and fisheries sectors.

“If invested well, Somalia’s fisheries and agricultural sectors can feed the entire Africa,” said Galip Yilmac, the Somalia program coordinator with the Turkish Cooperation and Coordination Agency (TIKA).

Banana exports resumed in 2014 to Middle East markets including the United Arab Emirates. The FAO said Iran and Turkey also expressed interest in Somali banana imports.

But the Somali growers also face skepticism from some quarters. Dole, for example, invested in Somalia in the past. But a representative of the company said “right now it seems difficult to develop any agriculture program in Somalia because of the local situation.”

Somali’s bananas sold in local markets

For now, most of Somali’s bananas are sold in local markets, and livestock has replaced bananas as the country’s leading export. Other exports are fish, charcoal and scrap metal. Export partners are the United Arab Emirates, Yemen and Oman.

Somalia has a population of 10.8 million. Its 2013 GDP was $1.4 billion, according to the United Nations.

Italian colonists introduced bananas to the fertile Shabelle and Juba river valleys of southern Somalia in the 1920s. The industry grew steadily and it peaked in the 1960s. Somali bananas are known for their sweet taste and creamy texture.

Rebuilding Somalia’s banana industry

FruitSome, the company formed by banana growers in 2012, is looking to increase exports, primarily to Europe and the Persian Gulf.

“Close to a hundred farmers are still registered as members of the banana growers association. They have been hoping to be able to export again but drought, civil war, social unrest and a shortage of irrigation infrastructure has so far made it impossible to revive the industry until very recently when the country has begun to re-emerge socially and politically, supported by international partners,” FruitSome said.

Despite the challenges, the FAO was upbeat about prospects for rebuilding Somalia’s banana industry. “With peace slowly returning to southern Somalia, this makes investment in the banana industry a key priority for FAO and its national and international partners,” the UN agency said.

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Is Donald Trump alienating the Middle East?

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Taking a look at Donald Trump and his recent outbursts that might alienate him with the Muslim world.

Donald Trump is making a lot of headlines these days and while they haven’t all been flattering, the 69-year-old business mogul seems unfazed that his brass manners have created such media furor. He is not a repentant person and has shown that he thrives in the media’s spotlight. He is often seen using loud words and confrontational rhetoric that that has helped him create both more supporters and more opponents, effectively polarizing the public, and whether for better or worse, he has been getting lots of media attention during his election campaign.

In a recent interview with Joe Scarborough on MSNBC’s “Morning Joe”, multi billionaire and presidential candidate Donald Trump made it clear that he would not be adverse to more surveillance of mosques in the US or even looking into closing some of them down. He believes a lot of the radicalization takes place in these mosques and that hatred towards America emanates from these houses of Muslim worship.

While these actions might alienate him to Muslims in general, they are nevertheless measures aimed at US citizens on US soil and as such they are not targeting the Muslim world in general. However, when he wants to ban all Muslims from entering the US, he’s sending a clear message to the international community as well. Adding to that his recent comments about Saudi Arabia being on par with China and other countries which he deems are cheating the US and one can understand why he might seem confrontational from a more international perspective.

Media feud with Alwaleed bin Talal

In a recent media spat, which was born after Trump had the idea to ban Muslims entering the US, Saudi Prince Alwaleed bin Talal let the presidential hopeful know what he thought of him when he tweeted the following: “You are a disgrace not only to the GOP [the Republican Party] but to all America. Withdraw from the US presidential race as you will never win”.

Donald Trump responded with accusations that Alwaleed bin Talal wants to control the US government with his daddy’s money and also called him “dopey”, which will surely not serve to lessen the tension between the two.

While Alwaleed bin Talal does not represent a united Muslim world, he is a well-known business magnate and philanthropist, ranking 34th on Forbes List of the richest people in the world in 2015. He has an estimated net worth of 28 Billion USD, dwarfing Donald Trump’s net worth and recently made headlines when he let the world know he’s donating his fortune to charity.

For the average voter in the US though, Alwaleed bin Talal is not exactly a household name and banning Muslims is not a problem. Among the American public Trump has the majority backing his proposal among Republicans, with a large estimated one third minority among Democrats backing him as well.

trump middle eastTrump and the international business world

The big question for business mogul-come-presidential nominee is not just about winning or losing the presidency. As a business man and a professional he must also contend with the lost business and brand value he is suffering from his remarks in the parts of the world he has been seen as demeaning.

The evidence seems to suggest he is already losing business in the millions from former partners in the Middle East as the Landmark Group is cutting its ties with the Trump Organization and will no longer carry home decor products from the company that is headed by Donald Trump.

What he is losing in business and brand value in the Middle East, he is most likely making back in campaign funding however, which has increased as he rides the wave of fear of Muslims and terrorism that has enthralled certain American voters.

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Driving Up Tourism in Abu Dhabi

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With ambitions to become a top winter sun destination, Abu Dhabi has launched a new cruise ship terminal and is developing its tourism infrastructure.

With ambitions to become a top winter sun destination, last Sunday, Sheikh Hazza bin Zayed Al Nahyan, National Security Advisor and Deputy Chairman of the Abu Dhabi Executive Council, officially opened Abu Dhabi’s first purpose-built cruise ship terminal. With capacity for three ships carrying 5,000 passengers at a time, this new terminal, located in the Zayed Port, marks a major landmark for cruise tourism in Abu Dhabi. 205,000 cruise visitors in 112 vessels are already scheduled for this season, 2015-2016, which is a fivefold increase compared to the first cruise season of 2006-2007. Officials expect this figure to increase by at least 15,000 next season to 220,000 cruise passengers in 117 vessels (2016-2017). Longer term growth projections anticipate that figure to reach 300,000 passengers in 130 vessels by 2019-20. Swiss-based cruise line MSC Cruises will be the first cruise line to use the new terminal as its home port for the 2015-16 season. The following season, it will be joined by Celebrity Cruises.

Abu Dhabi’s Economic Vision 2030

Development of the cruise tourism industry is part of a plan to significantly boost tourism in the emirate traditionally seen as second to Dubai as a tourist destination. In 2006, Sheikh Mohamed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi, mandated the development of a long-term economic plan to increase the non-oil share of the emirate’s GDP. Known as the Economic Vision 2030, the year by which predictions suggest Abu Dhabi’s baseline growth assumptions could achieve economic diversification, the plan focuses on finding tangible solutions to boost tourism and leisure. Sultan Ahmed Al Jaber, Minister of State, said: “By working closely with our strategic partners and building the necessary infrastructure we hope to expand Abu Dhabi’s tourism sector and reinforce its position as a major global destination.”

As part of the Economic Vision 2030 plan, in 2006 Abu Dhabi also formed the Tourism Development and Investment Company (TDIC), a body intended to drive development of the tourism industry. Capitalizing on blue seas, sand dunes, and UNESCO world heritage sites, the TDIC is currently working on more than 55 projects across the emirate which are all set for completion by 2020. Building projects include multi-use complexes, business and leisure resorts, and desert resorts. One of its flagship developments is Saadiyat Island, where branches of the Louvre and the Guggenheim are currently being built, and expected to open towards the end of next year. Two championship golf courses, environmentally-friendly resorts, new hotel developments, and luxury residential developments to house 160,000 residents are also underway.

The Abu Dhabi International Airport is also undergoing expansion in order to increase its capacity to 45 million. The new, high-tech 700,000 square meter Midfield Terminal Building, set to open in 2017, has been designed to process 19,000 bags per hour on a 22 kilometer baggage handling system and to utilize a new check-in system that can automatically verify mobile and printed boarding passes, improve security, and lower waiting times.

These projects will join the Yas Island development, Abu Dhabi’s $40 billion man-made destination island, which is home to the Ferrari World theme park and the $1 billion Yas Marina circuit, the most expensive F1 track ever built, which hosted the first Abu Dhabi Grand Prix in 2009.

Tourism up in Abu Dhabi

The strategy is already seeing some success. Abu Dhabi’s most recent summer season saw a 21% rise in the number of visitors compared with the previous year. The most significant growth came from Indian visitors, up by 29.8% year-on-year, and Saudi Arabian visitors, up 28% year-on-year. Visitors from the US also grew a significant 24.4%. And visitors from Europe grew 18.1%, with the United Kingdom and Germany contributing to the bulk of the increase. The figures mean that this year Abu Dhabi will exceed 4 million visitors for the first time. Sultan Al Mutawa Al Dhaheri, acting executive director of the Abu Dhabi Tourism and Culture Authority (TCA), said: “We are hugely encouraged by number of visitors who came to the emirate, not only from across the GCC but from around the world”.

The TCA will continue to focus on attracting tourists from India, a drive which this year saw a promotion office opened in India’s capital Delhi to increase passengers of Cruise Arabia, a voyage touring Dubai, Abu Dhabi, Bahrain, and Muscat. The TCA is also focused on attracting tourists from China. This year, more than 20 Abu Dhabi hotels, shopping centers, and tourist destinations enrolled in the China National Tourism Administration’s “Welcome Chinese” program to learn about providing services for Chinese travelers such as Mandarin-speaking staff and payment services for China’s UnionPay bank cards. The TCA has also led a delegation of Abu Dhabi travel suppliers, including representatives of Hyatt Hotels and Resorts and The Ritz-Carlton Abu Dhabi, to Korea and Japan. And looking toward the African market, the TCA will open an office in South Africa this coming year.

The Middle East looks to tourism

Abu Dhabi’s tourism aspirations are part of a burgeoning trend in the region. Dependent on oil for around 50% of GDP and suffering from high unemployment of the young, Saudi Arabia has begun investing in a number of programs to develop heritage sites, museums, tourist accommodation, and tourism infrastructure. A report by the Saudi Commission for Tourism and National Heritage (SCTNH) confirms: “Tourism represents the second most important economic sector in the Kingdom. Despite its low contribution to the gross domestic product (GDP) of only 2.7 percent, development plans in tourism show its ability to raise its contribution to higher levels, and makes it more capable to develop targeted areas especially the rural and remote areas that need comprehensive economic development to create jobs and investment opportunities.” The global Travel and Tourism Competitiveness Report currently ranks Saudi Arabia as 64th in the world. This in fact puts it ahead of many of the more traditionally tourist-focused countries in the Middle East: Tunisia is 79th, Egypt is 83rd, and Lebanon is 94th.

Qatar is also looking to boost tourism to diversify its economy; 2013 tourism figures were up 8.3%, but it still lags behind most of its neighbours. The Qatar Tourism Authority (QTA) has set a goal of attracting 7.4 million visitors by 2030, and has pledged to spend billions in developing new tourist attractions and training more hospitality workers. And Dubai’s Department of Tourism and Commerce Marketing (DTCM) is also busy implementing Dubai Vision 2020, a program designed to double the number of tourists from 10 million in 2012 to 20 million by 2020, and boost tourism’s share of GDP to $81.7 billion.

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Iran’s nuclear deal may not mean an oil boom

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The prospect of western sanctions ending in Iran is an exciting prospect for international oil companies hoping to tap the fourth largest oil reserves in the world. According to Russia’s envoy to the U.N. nuclear watchdog, the historic Iran nuclear deal is expected to see sanctions lifted in Tehran in January 2016. The Joint Comprehensive Plan of Action (JCPOA), a deal brokered between Iran and the P5 + 1 nations (France, China, UK, Russia, US and Germany) in July 2015 after 20 months of negotiation, is ground breaking. In exchange for Iran reducing its nuclear program, including swapping non-enriched uranium to scale back its stockpile of low-enriched uranium, Europe and the US will lift international economic sanctions on Iran.

Despite concerns that the US Congress may block the deal, the prospect of oil markets opening up to international oil companies seems more likely come January 2016, with the IAEA (International Atomic Energy Association) expected to close a 12 year investigation into Iran’s nuclear program when the board meets in December 2015.

Hope for oil markets as sanctions lift

If the Iran nuclear agreement holds, western sanctions are due to begin winding back in early January 2016. Consequently, a Reuter’s poll comprising 25 oil analysts and economists predicted that as much as 750,000 barrels per day (bpd) of Iranian crude oil could enter the global market by mid-2016. International oil companies such as France’s Total, Italy’s Eni and Royal-Dutch Shell are understandably enthusiastic about the prospect of gaining traction in Iran’s emerging oil economy. With the promise of 50 new production projects in Iran’s extensive oil and gas reserves and flexible contracts on offer in 2016, the prospect of an oil boom seems tangible.

iran oilProgress on JCPOA nuclear deal

But how robust is this deal in reality? Will Iran deliver on its promise to scale back their nuclear program?

On the one hand there are promising signs that Iran is ratifying the agreement. As recently as November, 2015 the Iranian nuclear chief, Ali Akbar Salehi reported that work had begun to decommission centrifuges. This activity was additionally confirmed by complaints in Tehran from 20 MPs, claiming that dismantling work at Natanz and Fordow facilities was advancing too quickly.

Further progression of the JCPOA was evidenced by Iran granting permission for the head of the International Atomic Energy Agency to visit the sensitive military site Parchin in September, 2015. This was despite earlier parliamentary restrictions which declared the nuclear deal excluded such inspections.

However, in complete contrast to these acts of compliance, in October, 2015 Iran fired a long – range ballistic missile from a hidden military base in a seemingly confrontational act of defiance. Considering sanctions will only be lifted when Iran fulfils conditions within the nuclear agreement, this action sent confusing signals.

Political climate throws doubt on nuclear deal

There is also concern that the nuclear deal has not been ratified into local Iranian law. Rather the Iranian parliament has referred to the JCPOA as a “Plan of Action”, maintaining the agreement’s voluntary nature (according to the Iranian government). This avoids the Iranian parliament having to mandate the agreement as an international treaty or contract, which would require local governmental authorization into law.

Thus the nuclear deal, in reality, is an agreement accepted by the Rouhini agreement on the basis of good faith, but stands on shaky ground when considering the implications for future governments. Until the JCPOA deal is legislated into Iranian law it would arguably be unwise for international oil companies to leap into Iran’s oil and gas market without some serious caution.

Conditions too volatile to ensure oil market stability in Iran

Although some economists have predicted a significant global reduction in oil prices once the JCPOA “day of commencement” arrives, the shifting sands of Iran’s political and military conditions make this eventuality less likely. Even if Iran does comply with nuclear downsizing, discontinues weapons testing and demonstrates political willingness to conform to the agreement, there is still concern about the power of the military over commercial operations.

For instance the US insists sanctions will be maintained over the Iranian Revolutionary Guard Corps. Although this military corps was designed to respond to internal or external threats against Iran, it now has extensive influence in the Iranian oil and gas industry via control over hundreds of companies. Therefore, international oil companies may still find themselves hampered by sanctions if they partner with Iranian companies maintaining ties to the revolutionary guard.

When the long term political and military complexities are considered in Iran, it seems it may be some time before the Iran nuclear deal will make a significant impact on global oil markets.

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Tehran takes tough line with VAT tax

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iran tax

Implementation of 2008 VAT  tax at a time of economic stagnancy is causing confusion and anger in Iran’s merchant class.

Across Iran there is a growing anger at VAT bills received by merchants, many of them covering the years since the tax was first implemented in 2008, and some of the bills reaching $100,000 or more.

As Iran faces economic stagnancy, businesses claim that these VAT bills could in many cases render their businesses unsustainable. Falling oil prices have greatly affected the Iranian economy over the last few years. And with the groundbreaking deal with the West on slowing development of nuclear weapon capability meaning that many sanctions will be lifted in mid-2016, many consumers have vastly reduced their spending in the hope that the deal will bring both lower prices and a greater range of available goods.

Relaxed Taxation

Historically Iran has had a laid back approach to taxation; authorities were often willing to negotiate and bargain, there was a high level of smuggled – and thus tax free – goods available on the market, and dual accounting was and is still common practice to avoid some taxes. But with the global oil market seeing reduced prices over the last decade, the Iranian government brought in a 3% VAT level in 2008 on all but everyday goods such as bread and some other food products.

But since President Hassan Rouhani took office in 2013, tax collection has been stepped up, a move that is now worrying business owners across Iran. With oil prices forecast to continue falling in the year ahead, the lifting of sanctions still several months away, and with a deficit that could reach 550 trillion Iranian rials next year (18.3 billion USD), the government is keen to maximize tax collection. Given that the vice-president of the Iran Chamber of Commerce, Pedram Soltani, estimates that 40% of all government income in the year ending March 2016 will come from taxation – with VAT constituting half that figure – it is understandable why the authorities in Tehran are keen to pursue this.

Power of the Merchants

But President Rouhani has to tread carefully on this issue. Despite there being a ban on free trade unions, the merchant class – or bazaaris to give them their traditional name in Iran – remains a powerful force with a past history of confronting the government on this same issue. They played a key part in the revolution of 1979, combining with the clergy to oppose the Shah’s oppressive policy and implementing strikes which crippled the economy. And, when they see it as necessary, they have again wielded that power to oppose policies by the new regime. A 2008 strike in response to the original implementation of VAT saw clashes with security forces as many businesses closed. This led to a temporary suspension of the tax and an announcement of annual rises with an agreement on figures of 6 to 15%.

iran tax 2Then in 2010 the government stated that VAT on many goods would rise by 70%. Once again the bazaaris went on strike and once again the government backed down, agreeing to reduce the VAT rise to 15% instead of 70%. The government also offered a concession that businesses who could show they operated at a loss in previous years could apply for an exemption from increases.

An interesting factor of both these strikes was that it was not confined to merchants who were affected by the higher rates but was instead supported by traders across a wide range of goods, illustrating that the bazaaris had strong solidarity across their “membership.”

A rock and a hard place

How this current dispute plays out will be interesting to observe and hard to predict. On one hand, there is a determined government led by Rouhani who is trying to steer the country through uncertain economic waters. Even with the lifting of sanctions due in mid-2016, it will take some time for that to have any positive effects. On the other hand there is a united and powerful merchant class who are adamant that many businesses cannot survive these new increases or backdated bills. Given the outcomes of the two previous strikes and the resulting government climb-downs, it may well be the case that Rouhani has to consider some form of compromise, as strike action of any length would further damage the economy and could also lead to more instances of public disorder.

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FACE Africa develops water sources and sanitation programs in Liberia

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Liberian American Saran Kaba Jones believes assuring access to clean water is the essential first step to rebuilding the war-torn West African nation.

At times recovery from the devastation of war seems intractable, even hopeless. But a 33-year-old woman whose family fled the civil war in Liberia when she was a child is proving otherwise.

Saran Kaba Jones, a Liberian American woman, founded FACE Africa in 2009 to help Liberians gain access to clean drinking water in the wake of her native country’s 14-year civil war. By the time the conflict ended in 2003, Liberia was in ruins – roads, schools, factories destroyed and no electricity or running water.

Jones believes providing access to water is an essential first step in addressing other problems such as lack of education and employment and rebuilding the shattered nation.

Water unlocks opportunity

“We view water as a true catalyst for change and it doesn’t just solve the issue of health, but it’s a holistic sort of development issue,” said Jones, who is the nonprofit organization’s executive director.

In its nearly seven years of existence, FACT Africa has worked with local residents to build 50 well projects that serve 25,000 people in 35 communities in Liberia. The organization has also trained 300 local pump mechanics.

A more recent effort is WASH, a project to provide water, sanitation, and hygiene awareness to local schools in response to the West African country’s Ebola outbreak.

According to UNICEF, 55 percent of Liberia’s schools do not have access to water, 43 percent do not have functional latrines and 80 percent do not have hand-washing facilities.

Local community engagement boosts success

A key aspect of FACE Africa’s effort is that local residents are engaged from the outset and communities take ownership of the water projects once they are operational. All of the projects so far continue to be fully functional, according to FACE Africa.

“Our projects utilize local materials, local labor and ingenuity and ownership is transferred to the communities upon completion. More importantly, we focus on optimizing sustainability of our water projects by forming long-lasting, collaborative relationships with communities,” FACE said.

Jones said she realized the importance of access to clean water in 2008 when she returned to her native country for the first time since her family fled the war when she was 8 years old. The family lived in Cote D’Ivoire, Egypt, France and Cypress before she attended college and settled in the United States.

Priority was education

She was initially focused on education, having contributed small scholarship assistance to a family friend in Liberia. But the visit convinced her that access to clean drinking water had to be addressed before significant improvements could follow in other areas.

“My interest at the time was education, but when I got to Liberia, one of the things I started to see was that one of the major impediments to education was the lack of clean drinking water,” she said. “Kids were getting sick and not showing up to school for long periods of time because they were drinking contaminated water.”

Empowering women

Jones also saw a connection between water and the empowerment of women and girls, who may spend as much as 60 percent of their day walking to collect water, robbing them of opportunities to work or go to school.

“One of the biggest impediments to women’s growth and development is the lack of clean water. Women and girls are the ones responsible for walking long distances to fetch water. I came to the realization that the basic necessity of clean water had to be met before any other area of development can be tackled. That’s what led me to focus on water, rather than education.’’

The UN estimates that Sub-Saharan Africa alone loses 40 billion potential work hours per year collecting water. FACE Africa estimates its 50 projects have saved 1 million work hours to date.

Africa hard hit

Lack of access to water is a global problem and Africa is particularly hard hit. According to FACE Africa, 663 million people globally do not have access to safe water supplies and more than half of them are in Africa. Globally, two million people die each year from water-related diseases. According to the World Bank, water-related diseases kill more African children less than five years of age than HIV/AIDS, malaria, and measles combined.

FACE Africa, based in Cambridge, Mass., raises money through donations, grants from foundations and corporations, and fundraising events, raising about $150,000 annually. The money can accomplish a lot: It costs FACE Africa $7,500 to build a hand-dug well and install a hand pump, for example.

Jones has been recognized for her work, including being named a World Economic Forum Young Global Leader and one of The Guardian’s Africa’s 25 Top Women Leaders in 2013.

From depression to determination

Jones said the harsh realities she found in Liberia on her first visit left her “depressed and disheartened.” But she was determined to make a difference and she has.

“There’s nothing more pleasant or fulfilling than seeing the smiles on the faces of women and children who no longer have to travel miles every day to fetch contaminated water and can now drink water without worrying about getting sick from it,” she said.

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Salma Elloumi Rekik, a glimmer of hope for Tunisian tourism revival

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salma elloumi

At a time when many would have shied away from such a hard-hit economic sector, Salma Elloumi Rekik, business woman and politician, boldly stepped into the role of Tunisia’s Minister of Tourism.

Time of action for the Tourism Minister

Little over a month after taking the reins from her predecessor Amel Karboul, on February 6th, 2015, the already fragile economy was knocked by Bardo terrorist attacks and again in the July Sousse beach massacre. Tourism has increasingly become the nation’s linchpin, generating 15 percent of the country’s GDP last year. It has been down to Rekik to provide solutions to get the vital tourism trade back on track.

On June 29th, 2015, Salma Elloumi announced the many government measures that were to be put in place to essentially give those in tourism a financial lift. Among them: loan repayments were postponed for the years 2015 and 2016, VAT reduced from 12 percent to 8 percent and overdue fines cancelled.

“The ministry has focused its actions on the change in the promotional policy, especially after the attacks of Bardo and Sousse,” said the Minister.

In an endeavor to broaden Tunisia’s appeal to holiday makers from African countries, Iran, China and Russia, Rekik worked hard to have security in the country strengthened and to increase air traffic, devoting a budget of 12.5 million of Tunisian dinars (over 6 million US dollars) for this purpose.

The lady behind the titles

Born in Tunis on June 5th, 1956, Rekik was influenced and immersed in business from an early age. Growing up surrounded by her family’s wiring company; she continued her education after leaving Omran High School at the Institute of Management in Tunis (ISG) until the age of 22. As well as possessing a business mind, the young Rekik became multi-lingual, speaking and reading in Arabic, French and English.

On leaving university she began working for the family business which her father, Taoufik Elloumi, created in 1985. Societé Cofat Med -SCM specializes in the design and manufacture of electrical wiring for motor vehicles and utilities and is still going strong.

“SCM started with less than 20 employees; now it is one of the most popular companies in Tunisia,” the 59 year old said of her father’s enterprise.

In the early 1990’s, Rekik expanded her professional outlook after the former president Zine el-Abidine Ben Ali launched a campaign to modernize agriculture. Taking this as a cue, she branched out into a new sector, industrial agriculture.

She began with Stifen, the food processing company her father founded in 1994. In time she was made CEO and the prosperous company became part of the expanding Elloumi group. Her appetite for responsibility led her to become the CEO of SCM and she went on to drive both companies to great success. Stifen now exports globally and lists Kellogg’s, Danone and Nestle amongst its clients.

Political life

The mother of three, not content with just one profession, she embarked on her political career after the 2011 Jasmine revolution in Tunisia. Spurred into action by the changes her country was experiencing, she co-founded the secularist political party Nidaa Tounes and became a member in the party’s executive bureau.

“Engaging in politics is a duty as a citizen,” she said, and she paid her duty well, following her party to victory against the Islamist Ennahda party in the October 26th, 2014 elections, only the second truly legitimate election to be held in Tunisia since 2011.

Their time in power was not smooth, including a coalition government with their Islamist rivals in February 2015. Further difficulties beset the party when Rekik, along with 30 other Nidaa Tounes deputies, resigned Sunday, November 8th, 2015. The mass resignation came in response to members becoming increasingly fractious about the conduct and intentions of some of the party’s fellows.

For the love of one’s country

For now, Rekik has a big enough task ahead in her work as Tourist Minister. Without doubt she has proven herself many times over in her varied chosen fields of work, and has shown and continues to display strong and prudent leadership skills, which have been sought after globally.

Versatile, intelligent and brave, Rekik’s work has been publically recognized and gained her two commendations by the Tunisian Republic for her service to the nation. She still found time to participate throughout her career in leadership, management, and crisis management training programs in the United States and Europe.

Her work as Minister of Tourism seeks to bring hope to the Tunisian people and highlight the rich array of positives her nation has to offer the rest of the world. Speaking on December 2nd, 2015, she announced the upcoming release of a film about the 2015 Nobel Peace Prize, which was awarded to the Tunisian National Dialogue Quartet, an encouraging sign and a pivotal moment for Salma Elloumi Rekik’s beloved country.

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Stef Wertheimer: Manufacturing Peaceful Coexistence in Israel

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Stef Wertheimer

Israeli industrialist Stef Wertheimer, founder of Iscar and Blades Technology, is investing millions in industrial parks to diffuse Arab-Jewish conflict.

Born in Germany in 1926 a decade before his family was forced to flee the Nazis to what was then British-Mandate Palestine, Stef Wertheimer is an Israeli industrialist who believes that his country’s problems and solutions lie in economics. Over the last 30 years, the billionaire has invested millions of his own personal wealth in building industrial parks and training programs for Arabs across Israel, in the hope of using job creation and lowered economic disparity to foster peaceful coexistence between Arabs and Jews.

The International Metalworking Companies Group and Blades Technology

Now aged 89, Wertheimer’s early academic career was short lived. He was expelled from school aged 14, and instead started working in a camera-repair shop. Later, in the lead-up to Israel’s War of Independence in 1948, he made weapons for the Jewish underground. And after the war, in which he served as a pilot and a member of the Palmach strike force, he set up a small metal tool-cutting factory in a garage in his garden in Nahariya. The city, Israel’s northernmost, is in an underdeveloped, largely agricultural and Arab region, about which Wertheimer says: “There were no jobs, this area was agricultural, and I decided that I had to do something on my own”.

He named his small operation Iscar, and within five years, the company was exporting precision carbide cutting tools to Europe and the US. Today, it is one of the world’s top two companies in the field, and its automotive, aerospace, and electronics industry customers include General Motors and Ford. It is also now the largest of 15 companies that make up Wertheimer’s International Metalworking Companies (IMC), a Group valued at $10 billion, with 140 subsidiaries in 61 countries around the world, employing over 10,000 people.

Wertheimer further expanded his manufacturing holdings in 1968, when the Israeli government asked him to make blades for the Israeli Air Force following a French weapons embargo. In the years following, Iscar Blades (now Blades Technology Ltd.) has similarly become one of the world’s largest in its field. With a valuation of $1 billion, its customers include Rolls-Royce and General Electric.

Wertheimer solidified his position as one of Israel’s most respected businessmen in 2006, when Warren Buffett’s conglomerate holding company, Berkshire Hathaway, bought an 80% stake in IMC for $4 billion. It was Buffet’s first purchase outside of the US, and he went on to buy the remaining 20% of the company in 2013 for $2.05 billion. The Wertheimer family (Wertheimer’s son Eitan started running day-to-day operations at Iscar in 2004) also sold its 51% stake in Blades Technology in 2014. And the deals have made Wertheimer the head of the wealthiest family in Israel and the country’s third wealthiest man, with an estimated net worth of $5.6 billion.

Tefen Industrial Park

Tefen Industrial Park

The Tefen Industrial Park

In the late 1970s, Wertheimer also served a term in the Knesset, Israel’s parliament. It was during this time that he decided that there may be a different route to achieving peace and stability in Israel: one centered on industry and job creation. Acting on his idea, in 1982 he established a residential community near Nahariya, Kfar Vradim, and later the same year moved the Iscar plant to the nearby industrial zone, Tefen. In 1984, the Tefen Industrial Park was officially inaugurated, marking Wertheimer’s first park dedicated to helping Arab and Jewish Israeli entrepreneurs set up export-focused industrial initiatives. “I started looking for a way to influence the Arab population in Israel, Jordan and the Palestinian areas by developing industry,” says Wertheimer. “The idea of industrial parks in the Middle East and on the borders between Israel and its neighbors is that the parks will bring industry and provide jobs, which will keep people busy working, instead of engaging in terrorism”.

The Tefen Industrial Park now hosts 20 companies, and also offers a post service, a shared dining hall, landscaped gardens, a collection of vintage cars, a tennis court, and a school that educates students in industry and innovation. Wertheimer, whose own main office is on the site, has also created art and German-Jewish history museums.

Expanding Israel’s Industrial Export Output

His unique philosophy stems from the country’s problem of economic disparity. Israel’s 1.7 million Arab citizens make on average 58% of the income of their Jewish counterparts. Arab men make 69% of the income of Jewish men. And there are three times less Arab women in the labor force than Jewish women. The Arab population is also largely excluded from Israel’s current tech boom, which this year has seen $9 billion in tech mergers and acquisitions.

Based on the five principles of export, education, coexistence, community, and culture, Wertheimer has now established six further parks in typically Arab dominated regions – five in Israel (in Tel Hai, Omer, Dalton, Lavon, and Nazareth) and one in Turkey. The industrial parks, which Wertheimer calls “capitalistic kibbutz”, also run training programs before placing the workers in jobs, and recruit Arab and Jewish entrepreneurs for industrial entrepreneurship courses to create Arab-Jewish partnerships. Firms also receive benefits encouraging the employment of professionally educated Arabs. The parks have so far generated and supported 260 companies, which have seen an average yield of $200,000 in sales per employee, higher than Israel’s average. And Wertheimer also has plans to add another park aimed at the Bedouin, one of the region’s poorest communities.

Yitzhak Rabin, former Israeli prime minister and 1994 winner of the Nobel Peace Prize, said: “With 20 more industrial parks like these, it would be possible to double the industrial export output of Israel. This would completely change the economic, social and security situation.” Wertheimer has also been honored for his work. He was awarded Israel’s highest honor, the Israel Prize, in 1991. In 2010, he received the Oslo Business for Peace Award. And Germany has bestowed both the Federal Cross of Merit and the Buber-Rosenzweig medal for his work in advancing peace through entrepreneurship.

Not everyone agrees that an economic solution will solve Israel’s problems, but Wertheimer is fully committed to a future trying to do just that.

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