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Vangsy Goma – the entrepreneur behind an African Uber.

14 November 2016 Comments (0) Africa, Business, Featured

Vangsy Goma is the young man behind Africab, the latest Uber style taxi service within the continent of Africa. Goma himself is only 31 years old, but his company has already had an immediate impact in the Ivory Coast, and his fresh approach to the industry could reach far further than its launch site.

From Africa to Europe and back again

Vangsy Goma was born in the capital of the Republic of Congo, Brazzaville, into a powerful Congolese family. Goma’s grandmother is the wife of Congolese president, Denis Sassou Nguesso, and yet his privileged upbringing did not dent an enthusiasm to create changes in his home continent. Goma went to pursue further education in France, and eventually graduated with a degree in management and marketing from France’s IDRAC institute. Goma decided to return to Africa, and his home country, where he began working as a project manager for Congo’s Assistance Foundation – a body that focuses on spreading access to education for children within the Lower Kouilou region. By 2012, Goma changed path, and began working for the oil company CNPC as a commercial services manager; before another move into a higher position, as commercial director, at Congo’s MBTP construction company. It was during his time with MBTP that Goma devised his plan for Africab, and he began talks with professional colleagues and the investment group, CEMAC, about his vision.

The creation of Africab

While Goma could have easily avoided the stress and financial risk that comes with starting up your own business, nothing in his background (or successful early career) appears to have reduced his entrepreneurial spirit, or desire to help his own people. Goma says that it was a conversation with a friend, and fellow entrepreneur, Vérone Mankou, that led to him formulating his idea for Africab. Mankou is the man behind a highly successful Congolese mobile phone company, VMK, and Goma explains that his business model was one that inspired him, because “he turned great local demand for imported products into inclusive local economic growth. VMK means new jobs and new skills for Africa.”

Goma felt that this was something he could also use as a model to rectify a problem that he had noticed on a visit to the Ivory Coast’s capital city, Abidjan. Goma explained, “Africab is a ‘startup’ born from the observation…that African urban populations had new transportation needs.” Goma observed that many African nations had a rapidly growing middle class, and that existing transport systems were unreliable, unsafe or lacking modern facilities that many consumers desired. The initial target audience was the men and women of the professional middle classes, which is why Goma proudly describes how “In our taxis, we have electronic tablets, on which you can check emails and city guide. There is also a 4G network available on board.”

Abidjan is only the beginning

Despite being Congolese, Goma chose Abidjan as his launching point, due to “purely economic reasons and opportunities”, as the city (and Ivory Coast as a whole) has a well-established middle class, with stable growth, and a high demand for new services. However, Goma’s goal is to revolutionize transport across sub-Saharan Africa, and he is eager to bring Africab to his hometown of Brazzaville as well as many other destinations.

While Abidjan’s relative prosperity was ideal for the company’s launch, Goma wants his company to not only work for the customers, but also for its employees. Unlike Uber, and other established taxi apps, Africab owns all of its cars, directly employs its drivers, and sees long-term job creation as one of its core components. Goma says he wants it to be a truly pan-African company that provides its staff with training, and opportunities to develop their potential.

Since Africab launched in February of this year, the fleet of cars has extended from 30 to 50, and has already ordered 120 more vehicles, such is the demand! Goma states that 10,000 potential customers have downloaded the app, and he recently signed a deal with the Beninese Company, MIG Motors, which will be responsible for rolling out the service in Benin. Vangsy Goma is still only 31, but his success looks likely to continue, and investors will be watching his progress with interest.

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William Kamkwamba: The Malawian wind tamer

12 November 2016 Comments (0) Africa, Environment, Featured

William Kamkwamba is someone you may have heard of. The 29 year old Malawian is has made himself famous for his remarkable achievements and brilliant mind. Indeed, the young man has delivered inspiring TED talks, and his book, The Boy Who Harnessed the Wind is a New York Times Bestseller.

Hard times suggested a bleak future

Kamkwamba’s early life was difficult. Born in a poor rural community in Malawi, his family relied on farming for subsistence. In 2001, when he was just 13, a major famine swept through  claimingthousands of lives and destroying entire communities. At the peak of this crisis, more than 70% of the nation’s farmers were considered at risk of starvation.

Food was so scarce that Kamkwamba parents would often go without a meal so that their children could eat.

For Kamkwamba, the disaster meant that his family could no longer afford to send him to school for five full years. As a natural and avid learner, he was devastated by his inability to attend class. However, determined to continue his education however he could, Kamkwamba immersed himself in books from a local lending library.

A mind that couldn’t be denied

Through the library, he developed a passion for engineering. He taught himself about circuitry, materials, and physics despite only having a basic understanding of English. In the aftermath of what he set up his own small business fixing people radios and other electrical appliances.

One book in particular called Using Energy, concerning wind turbines, became of particular interest. He was astounded to learn that wind energy could provide reliable electricity and power irrigation. As a result he vigorously studied the complex schematics, all the while considering how he could apply them in his own environment.A crude Kerosene-powered generator was the only source of energy his family possessed at that time.  Since the engine was costly, expensive and unreliable Kamkwamba started by fashioning a prototype windmill form an old radio motor. Pleased with the results, he set about building his first real windmill, salvaging what he could from a scrap yard. He said, “Many people, including my mother, told me I was crazy.”

Undeterred, Kamkwamba created his windmill with an old bicycle, a dynamo, PVC pipes, the fan blades from a defunct tractor, and a shock absorber. He connected his contraption to a car battery so he could store the energy he harnessed. What’s more, he completely wired his own house to include switches and a circuit breaker.

John Collier, an Engineering Professor and advisor to Kamkwamba said, “To start with nothing and end up with a fully-fledged windmill that produces power is an extraordinary move – and to do it all with no tools except for some nails?”

International Acclaim

Before long, local villagers were clamoring to charge their phones at Kamkwamba’s house; the only source of reliable power in the area. The news of his achievements spread across the country, and journalists came to visit. The national newspaper, The Malawi Daily Times wrote a long piece on Kamkwamba, as did Hacktivate blogger Mike McKay. The story came to the attention of Emeka Okafur, the Program Director of TEDGlobal. Fascinated by Kamkwamba’s story, Okafur invited him to TED as a fellow.

Before his talk at TED, Kamkwamba had already made some serious improvements to his system. He increased the diameter and height of his first windmill, which provided power to additional houses in his village. He also built a second windmill which powers a pump and an irrigation system.

An example for a generation

Upon attending TED, his story was incredibly well received. Inspired philanthropists in the audience became mentors and benefactors. The famous satirist and TED speaker Tom Reilly pledged to support Kamkwamba through seven years of school and university.

He was swiftly enrolled in the African Leadership Academy, a prestigious institution designed to rigorously prepare the talented students through academics, ethical leadership, entrepreneurialism and design. Kamkwamba then went on to study Engineering and Design at Dartmouth University, USA.

Since graduating in 2014 Kamkwamba has overseen numerous wind turbine installations throughout Malawi. He intends to use his education to continue solving problems his home country is facing with. His foundation, Moving Windmills, has already delivered numerous life changing development projects across the country.

Finally he wants to open an innovation centre to inspire the next generation of young leaders and entrepreneurs. Perhaps a quote from Kamkwamba’s own TED talk should adorn the walls: “Trust yourself and believe, whatever happens don’t give up.”

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Top four South African banks boost IT spending

10 November 2016 Comments (0) Africa, Featured, Technology

As customers shift to electronic banking, South Africa’s four largest banks spent a total of more than $2 billion on information technology and personnel to run it during the year ending in June. At the same time, two of the four banks, Barclays Africa’s Absa bank and Standard Bank, have closed dozens of branch offices, a further reflection of the growing preference for virtual banking, especially among young consumers. The $2.1 billion IT spend represented about 15 percent of the banks’ total operating costs for the same period, according to Hilton Tarrant, an analyst based in Johannesburg with the tech firm immedia. In addition to Barclays Africa’s Absa and Standard Bank, Tarrant’s analysis includes First National Bank and Nedbank. Tarrant also said IT spending is increasing, led by Standard and Barclays. For example, Standard Bank’s IT spending, including salaries, totaled $900 million in 2015, up 11 percent from the year before. Barclays Africa spent $480 million, a seven percent increase over the prior year.

Trend expected to continue

“The trend is only going to accelerate as transactions continue to be offloaded to Internet and mobile banking,” Tarrant said, noting that native mobile banking apps with better security would also drive the appeal of electronic banking. In total, the four banks have reduced the number of branches in South Africa from 3,005 in 2011 to 2,862 at the end of 2015, a reduction of 143 branch offices or five percent, according to Tarrant. Barclay’s Absa closed more than 100 branches in the last five years, and Standard Bank over 50. First National Bank has about the same number of branches as it had in 2011 and Nedbank has added 13 branch offices. In 2015, Barclay’s Absa had the largest footprint of the four with 784 branches. First National Bank had 723, Nedbank 708 and Standard Bank 647.

Branch offices incur high costs

While there have been complaints about bank branch closings, Tarrant said that is a good idea, given high costs to operate them and reduced consumer interest in banking in person, especially among mobile-focused young people. “Traditional banks’ branches have high costs, which is one of the reasons why the companies have pushed hard to shift transactions to electronic channels,” Tarrant said. South Africa is part of a global and continental trend toward electronic banking. In 2014, mobile money transactions generated more than $650 million in revenue in sub-Saharan Africa and the amount is expected to double to $1.3 billion by 2019, according to research by Frost and Sullivan ICT. According to the World Bank, fewer than 25 percent of the 1.4 billion  population of the continent have a bank account while 40 percent have a mobile phone.

Banks dominate mobile market in South Africa

On the continent, South Africa is unusual. With 75 percent of the adult population using banking services, the country’s banks have established themselves the major players in online and mobile transactions. In many other sub-Saharan African countries, where a much smaller share of the population uses any banking services, mobile service providers dominate the marketplace. Earlier this year, a top East African bank announced plans to challenge a major telecommunications operator to gain a larger share of Kenya’s electronic banking market. Banks in Cameroon, Mali and Nigeria also are trying to tap into the growing market of electronic payments.

In contrast, efforts by telecommunications companies to crack the South African electronic money market have foundered. The African telecom giant MTN in September announced it would halt its mobile money service, saying it was not commercially viable. It was the second telecom to drop service in South Africa this year. In May, Vodacom, a Vodafone subsidiary and the nation’s largest mobile network, announced it was throwing in the towel after its M-Pesa service – popular in other countries including Kenya – failed to catch on. The company had hoped to sign up 10 million South African users when it launched M-Pesa in 2010. However, by 2015, only one million people had signed up and only 76,000 were active on the platform.

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Jamila Abass: Changing the face of farming in Africa

8 November 2016 Comments (0) Agriculture, Featured, Technology

Jamila Abass is a shining example of the young, innovative, tech-focused generation emerging throughout Africa. Her business, M-Farm – a tech solution that provides valuable services to Kenya’s farmers – is a fantastic model of how technology is breaking down long-standing barriers. Early in her life, Abass worked tending crops in her family’s small kitchen garden. She grew and sold kale and coriander, giving her perspective on the agricultural industry, and playing a key part in her later interest in rural development. Abass proved to be a gifted student. She went on to study Computer Software Engineering at the Université Abdelmalek Essaâdi Tétouan in Morocco. After graduating in 2009, Abass teamed up with fellow tech entrepreneur Susan Oguya. They were both perturbed by the state of Kenya’s farming industry. Abass said, “The newspapers always had sad stories of farmers getting exploited by middlemen.” She explained that unscrupulous intermediaries were leveraging farmers into selling their produce for a fraction of their true market value; a situation which had been ongoing for decades.

Tackling the exploitation of farmers

Abass and Oguya wanted to develop a solution to tackle this issue. They conceptualized a digital platform that farmers could access through their mobile phones. They theorized that this marketplace would arm farmers with the information they needed to protect themselves and make smarter decisions. Looking back, Abass explained “They (farmers) had no information and no alternative market. We wanted to close that information gap between the farmers and the market”.

Soon after coming up with the idea, the pair took their concept to the IPO48 challenge, a kick-starter designed to support promising online solutions. Abass and Oguya won a US$10,000 dollar prize and subsequently began building M-Farm. M-Farm began as an SMS service by which farmers could check the daily prices for over 40 popular crops, and identify buyers throughout the country. Through partnering with renowned tech startup M-Pesa, M-farm allowed farmers to make and receive mobile payments. With mobile phone technology widely available across Kenya, M-Farm is an affordable option for even the poorest rural farmers. By 2012, Abass had over 5,400 users on the platform. These farmers had managed to more than double their profits, thanks to the direct links M-Farm offered with legitimate buyers and exporters.

Progress, but some still struggling

In late 2012, M-Farm made the finals of the highly prestigious Unreasonable Institute Exhibition. M- Farm’s success was on full display, and Abass’s excellent presentation brought valuable exposure to the firm, ultimately attracting further investment. With financing secured, Abass and the team looked at ways that they could improve their service. They identified that for some farmers, simply providing them with pricing information was not enough to improve their fortunes. Many were still struggling to access the markets and get a fair price for their crops.

Abass identified that rural growers were producing in low volume, and that for major buyers, it was impractical and expensive to acquire the produce they needed from multiple small-scale enterprises. To counter this, M-Farm launched its group selling tool this enabled local farmers to form cooperatives, making their produce more attractive and easier to sell. Abass quickly extended the cooperative model by rolling out a buyer's cooperative feature, whereby farmers can band together and negotiate better purchases of fertilizer, seeds, and equipment.

International ambitions

The M-Farm platform has evolved to become a powerful and promising tool. As Abass said, “There are so many things you can do with the technology.” Today the platform offers transport services to farmers through partnerships with local logistics and haulage businesses. M-Farm now also arms its members with valuable industry knowledge. For instance, farmers can access expert agricultural advice, forecasts for future crop demands, or guidance on international regulations such as prohibited chemicals and pesticides.

Abass has also made inroads into the international market, establishing links with major retailers in Europe who are keen to run a socially responsible supply chain. With over 22,000 clients now thriving in Kenya, it’s clear Abass has a seriously effective business. She now intends to scale M-Farm globally, bringing its considerable benefits to farmers in other emerging countries. The story of Abass and M-Farm signifies how entrepreneurship and technology are changing the face of Africa.

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New bank SunTrust focuses on tech to make changes in Nigeria

6 November 2016 Comments (0) Africa, Featured, Technology

A new player has arrived in Nigeria’s banking sector. SunTrust Bank officially opened for business last month, becoming the first new institution to be granted licensing by the Central Bank of Nigeria since 2001. SunTrust has been making headlines due to its innovative, tech-driven business model that stands in stark contrast to Nigeria’s traditional financial entities. The bank could prove to be a disruptive force within the country’s banking space.

A technology based bank is born

Muhammad Jibrin, the bank’s Chief Executive Officer, has been one of the driving forces behind the bank’s emergence. Jibrin founded SunTrust in 2009, at the time the firm was focused solely on mortgage lending. After enjoying years of steady success, the board decided to pursue a commercial banking license, a notoriously difficult proposition given Nigeria’s stringent financial controls. SunTrust finally obtained the coveted license in late in 2015, becoming the first new bank to do so since the beginning of the 2000s. Jibrin and the SunTrust team have a vision of providing a modern, technology driven service that will change the way banking works within Nigeria. He said “Banking is no longer where you go, it is what people do. Therefore, the only thing that can stand the future is no longer physical branches, but banking services that would be driven by technology.”

New ways of banking can help millions

Nigeria remains woefully underserviced by the traditional banks in the nation. An estimated 40 Million adult Nigerians are currently “unbanked”. SunTrust is looking to bring quality banking services to this demographic. In order to achieve this SunTrust has laid out a daring strategy and ambitious goals. The bank only runs a handful of branches as it is restricted in where it can physically operate by its regional license. However, this suits their strategy just fine. SunTrust intends to attract customers the length and breadth of the country by focusing on purely electronic banking services. Jibrin said: “We will be everywhere because we are not limited by barriers or by physical location; technology is not limited physically and therefore whether you are in the South-East or in the North, we can easily service you.” Less branches on the ground means less overheads; SunTrust says that it will be able to offer the same services, more cheaply and effectively than the traditionally encumbered financial institutions.

SunTrust focused on the future of finance

Jibrin recently made an excellent point about the future of banking in Nigeria. He pointed out that 70% of Nigeria’s population could currently be classified as “young” and that this demographic is growing rapidly. The country has approximately 170 million citizens, yet this number will be as high as 220 million by 2025, making Nigeria one of the youngest countries on the planet. It is this growing, young and tech savvy population who largely don’t have access to, or can’t afford traditional banking services. SunTrust intends to be the bank for the new Nigerian generation. SunTrust has received praise for its courageous decision to launch in the midst of a recession, an unprecedented event for a financial institution. Charles Onyema Ugboko, SunTrust’s Chairman, said that going into business at this time proved that “the board and management are committed to the growth of the Nigerian economy.” Similarly, SunTrust has been lauded for its intent to focus on small and medium scale enterprises. These companies have long struggled to obtain credit from traditional banks, yet SunTrust intends to break the mold by placing them in clusters and cooperatives which will help to mitigate risk. The bank’s board is dedicated to this strategy as they feel that these underserviced businesses hold immense potential to drive growth In Nigeria.

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Azuri: Solar energy for off-grid Africa

4 November 2016 Comments (0) Africa, Environment, Featured

A British company is bringing pay-as- you-go solar power to rural communities in a dozen countries in East and West Africa with the help of artificial intelligence. With about 90,000 customers so far, Azuri said its PayGo solar system for communities that are too remote to access a power grid has the widest reach of any such provider in sub-Saharan Africa. Using artificial intelligence, Azuri said it has solved a significant problem with off-grid solar systems. On cloudy days, solar systems may not capture and store enough energy to provide electricity for the entire evening, causing frustration for users who may be watching television, doing homework, keeping a business open in the evening or charging their cell phones for the next day.

In addition to providing batteries and solar panels to customers, Azuri offers artificial intelligence technology that monitors each customer’s usage and slightly reduces electrical output to make sure power is not interrupted if the day’s supply is short. The reduction may dim the lights slightly, but it is barely noticeable, according to Simon Bransfield-Garth, chief executive officer of Azuri.

Power available longer

With this reduction, a battery that might only provide three hours of power at regular levels of output can stretch to four or five. People “want to be able to see at night. They’re less concerned about how bright the light is. They just want to be able to see,” Bransfield-Garth said. So the artificial intelligence technology figures out the customer’s average use then looks at the battery in the evening and adjusts the brightness of the lights so customers are “guaranteed to get that duration of light every night.” “It’s like the engine controller in your car that’s looking after all sorts of things in your engine,” he said.

System works in cloudy climates

So far, Bransfield-Garth said, the system has operated well in a diverse range of climates, from Ghana’s lengthy rainy season to Kenya’s abundant sunshine. “We have made technology that works in countries where there is a lot of sunshine and in countries where it is cloudier,” he said. Azuri’s pay-as- you-go system makes buying the package practical for many who would not be able to afford an up-front payment for the Azuri package. Using mobile payment services to buy credit on a weekly basis, customers typically pay for their equipment in 18 months, the company said.

Lower costs, environmental benefits

Bransfield-Garth noted that off-grid electricity costs in Africa are much higher than power costs in the west. He said burning kerosene costs about $8 per kilowatt-hour compared to U.S. electrical prices of about 15 cents. Azuri’s system frees up those costs to cover the solar payments to individuals who may earn only two or three dollars a day. He said the Azuri system is much cheaper than traditional sources, which can cost as much as 30 percent of the income of poor families. According to Azuri, solar power is an effective and environmentally safe replacement for traditional sources of light, which include burning kerosene or candles or using disposable batteries.

A 2014 study of customers of Azuri’s PayGo system in western Kenya found that users expressed pride that they could provide electricity for their children to study in the evening. They also said they were saving money on charging their phones and saving more than two hours each week to go and buy kerosene. More than 85 percent said they had been able to work more since installing the Azuri system. Studying and phone charging were the most common activities, each cited by about a third of the customers. Other uses included cooking, working and socializing. The company, which is based in Cambridge, has an office in Nairobi and additional staff in five other countries.

Students improve

Azuri also sells LED lights, mobile-phone chargers and MP3/radio players. The company also plans to offer a small television set with a satellite connection that can run on 10 watts of electricity. Bransfield-Garth noted that installing solar systems in remote areas has a significant social, economic and education impact as people become more connected and more productive. “On average, children spend two hours a day extra on homework when they have solar lights,” he said. “ It’s entirely normal for kids to go from mid-class to top of their class in three months just because they’re doing more studying.”

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U.S. and Africa: From aid to trade

2 November 2016 Comments (0) Africa, Economy, Featured

U.S companies are just “scratching the surface” of business opportunity in Africa, effectively leaving an expanding market wide open for China, according to advocates for boosting trade, including President Barack Obama. Dismissing the economic slowdown of some African nations as temporary, experts at the second U.S.-Africa Business Forum pointed to the potential offered by an expanding middle class, untapped mineral wealth and expanses of uncultivated farmable land on the continent. Among those urging more trade between the United States and Africa was President Obama, who spoke to the forum in New York on Sept. 21. “We are making progress but we are just scratching the surface,” Obama said. “There is still so much untapped potential.”

Share of trade remains small

Obama and others pointed to significant growth in trade between the United States and Africa. But experts noted that economic activity is tiny as a share of total trade on either side. Sub-Saharan Africa accounted for only one percent of all U.S. trade in 2015. While 5.6 percent of Africa’s trade was with the United States, that amount is much smaller than the more than 19 percent of the continent’s trade with China, which has stepped up economic ties with Africa in recent years. According to the Obama administration, American and African countries have made deals worth $15 billion since the first U.S.-Africa Business Forum two years ago. Another $9 billion in deals were announced at the forum.

U.S. investment grows

American investment in Africa grew by 70 percent with major companies including Google and FedEx increasing their presence on the continent. African nations, meanwhile, have encouraged increased trade and business development by cutting red tape and promoting political stability. The Obama administration has pushed initiatives to double access to power and offer preferential trade terms in order to help the continent develop its manufacturing and agricultural sectors.

Obama said infrastructure will power the economies of African in the future, especially increasing access to electrical power for two-thirds of sub-Saharan Africans who lack access today. Besides the extension of trade accords with Africa and its Power Africa program to boost electricity supplies, the U.S. increased support from the U.S. Export-Import Bank, the U.S. Trade and Development Agency, the Overseas Private Investment Corp. and the Millennium Challenge Corp.

Red tape, political instability slow growth

For its part, Africa is working hard to ease barriers to trade and investment through development of regional free-trade accords and political stability, according to Nkosazana Dlamini-Zuma, chairwoman of the African Union Commission. Still, there is more to be done as Africa seeks to recover from an economic slowdown prompted by falling oil and commodity prices as well as a drop in demand from China, which has its own economic struggles. The International Monetary fund recently forecast that sub-Saharan Africa’s economy would expand by only 1.6 percent this year, about half the growth rate of 3.3 percent in 2015 and well below the annual average of 5.7 percent in the 10 years before that.

Meanwhile, foreign direct investment in Africa dropped as the commodities boom ended. Foreign direct investment fell to about $71 billion last year, down nearly 20 percent from more than $88 billion in 2014, according to accounting firm EY.

Some African economies thrive

However, the averages for the continent do not tell the whole story. While South Africa and Nigeria, the two largest economies in the sub-Sahara, are struggling, several nations, including Kenya, Rwanda, Tanzania, Ivory Coast and Senegal, are expected to experience economic growth well over 5 percent this year. At the same time, a growing population and increased consumption pose opportunity for businesses that gain a foothold on the continent. Household consumption in Africa is expected to grow 3.8 percent annually until 2025 when it will reach $2.1 trillion, according to McKinsey & Co. It projected that the continent will have a bigger workforce than India or China by 2034.

Amadou Sy, director of the Brookings Institution’s Africa Growth Initiative, said U.S. companies have been slow to shift from seeing the continent as an aid recipient to seeing it as a potential business partner. While aid has long been the primary focus of dealings with Africa, that is changing Sy said. ‘’The other side of the coin is that we have fast-growing economies. We have business opportunities,” he said. “The first accomplishment is getting U.S. businesses and U.S. stakeholders to look at Africa as a business partner.”

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South Africa leads the way with renewable energy

31 October 2016 Comments (0) Africa, Featured, Technology

Long dependent on coal, South Africa has become the leader on the continent in developing renewable energy sources thanks in part to a competitive bidding process that helps keep costs low. South Africa had accepted a total of 92 projects providing an estimated 6,300 megawatts as of April. The projects represent more than $13 billion in private investment.

The Cookhouse wind farm on the country’s eastern cape is the largest installation, producing 138 megawatts of electricity since it started feeding the power grid in 2014. But wind, solar and biomass projects are popping up all over the countryside. Still, South Africa remains highly dependent on fossil fuels. It is the 11 th largest emitter of carbon output from energy use in the world. But it is making progress with renewables. Tina Joemat-Pettersson, South Africa’s minister of energy said the country had added a total of about 4,300 megawatts of renewable energy capacity between 2011 and 2015 alone.

Low cost drives development

One driver is cost. By last year, the price of wind energy from new projects had dropped to five cents per kilowatt-hour, about half the cost of coal. “Not only is technology producing much cleaner power, it is doing so at a lower cost than traditional fossil fuel technologies,” Evan Rice, chief executive of Greencape, a government funded not-for- profit development agency in Cape Town, said.

In partnership with the city of Cape Town, the national government, and Germany, Greencape is launching the South African Renewable Energy Technology Center, which will train 250 technicians annually to operate renewable energy systems around the country.

Bidding process plays a role

Anton Eberhard, a professor at the Graduate School of Business at the University of Cape Town, said South Africa’s competitive bidding process has helped keep costs low while assuring efficient development. Rather than negotiating with a vendor directly on a case-by- case basis, the bidding process uses competitive tenders and may give awards to multiple bidders,

Eberhard said. He said the transparent process leaves less room for corruption, which has hampered development efforts in other countries. The process also offers financial advantages, Eberhard said, noting that prices bids had dropped by 48 percent for wind and 71 percent for solar energy over the course of four rounds of bids during the past several years.

He said advances in battery technology will reduce the problem of interuptions in wind and solar power when there is no wind or sun. This will drive more development of these resources and reduce reliance on fossil fuels.

Energy installations produce jobs

The developments are also benefitting local communities. For example, a factory that will produce wind towers in the economically depressed township of Atlantis outside Cape Town is expected to employ 200 people to build 150 towers a year. Rice expects employment to grow as production ramps up. Also, 15 percent of the sale of energy itself goes into a community trust that enables local trustees to funnel money into education, health care and economic development locally.

Renewable energy developments will “transform rural communities in terms of health care, education, job creation and a raft of other interventions,” said Johan van den Berg, director of the South African Wind Energy Association.

Nation still banks on fossil fuels

Despite the promise of renewables, South Africa is not turning away from fossil fuels entirely. The government plans to open up 20 percent of the country to shale fracking and President Jacob Zuma has approved a deal to buy eight nuclear power plants from Russia at a cost of $84 billion.

The country is also building Medupi, the largest dry cooled coal-fired power station in the world. Construction began in 2007 but has been mired in cost overruns and delays for years. Once completed, it is expected to produce more than 4,000 megawatts, about the same amount that South Africa developed with renewable projects in just four years. Still, Berg and others see a bright future for renewables in South Africa and beyond.

The continent, he said, has “the opportunity to leapfrog the old centralized large scale fossil fuel power and big grid paradigm. With technology and project prices continuing to drop, and rapid breakthroughs in battery and other storage technologies, I have no doubt that renewables will address all of our power needs in time.”

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Small economies drive growth in Africa

29 October 2016 Comments (0) Africa, Economy, Featured

While sub-Saharan Africa’s two largest economies are struggling, experts say a cluster of smaller nations are driving growth on the continent this year. In East Africa, Kenya, Rwanda, Tanzania and Uganda will see growth of more than 5 percent this year, according to the International Monetary Fund (IMF). In West Africa, Senegal and Ivory Coast are also expected to see significant growth.

Meanwhile, two traditional economic powerhouses will see little or no growth. South Africa faces political turmoil, labor unrest and a drop in demand for minerals, while Nigeria has been hit by sagging crude oil prices. The economic forces that challenge Nigeria and South Africa – particularly the oil slump – have helped the East African economies because they benefit from lower energy costs but do not rely on oil exports.

Economic diversity is a factor

“East Africa has been chugging along nicely,” Peter A. Montalto, economist with at Nomura International, told Bloomberg, predicting healthy growth would continue at least until the end of 2017. He said those economies are likely to continue to grow if they take advantage of low oil prices and take steps to attract investment. Economic reform and diversification play a role in the strength of the East African nations, Stuart Culverhouse, chief economist at Exotix Partners LLP in London, said.

Unable to fall back on “behemoth industries,’’ these countries made economic reforms that are benefitting them now. Tanzania’s gross domestic product is expected to grow by 6.9 while Rwanda and Kenya also could top 6 percent. The IMF predicts the economy of Uganda will increase by 5.3 percent. In West Africa, Ivory Coast and Senegal will also grow by, 7.4 and 6 percent respectively, the agency said.

Average growth stalls in 2016 

Since Nigeria and South Africa account for half of the economic output of the continent, growth in other countries is not expected to entirely offset their stagnation. South Africa’s economy will be flat while Nigeria’s is expected to contract by 1.8 percent. The IMF recently predicted average growth of only 1.6 percent on the continent this year, less than half the growth rate in 2015 and well below the average of more than 5 percent annually in the last decade.

Direct foreign investment also dropped last year to $71 billion compared to $88 billion a year earlier. Razia Khan, head of Africa research at Standard Chartered Plc in London, said many investors believe the problems of Nigeria and South Africa reflect on the continent as a whole, which dampens enthusiasm for the smaller economies even though they are doing well.

IMF recommends policy reforms

Nevertheless, the IMF says sub-Saharan Africa has bright prospects for growth in spite a challenging global economic environment. Natalia Koliadina, the IMF’s representative in Ghana, which has seen an economic slowdown, said many countries in the region need to diversify their economies in order to minimize hits from slumps in commodities prices.

Policy reforms, improvements in infrastructure and high workforce skills will all be required, Koliadina said. The IMF also encouraged putting in place policies and infrastructure to create an environment that supports businesses, especially small businesses. John Ashbourne, an analyst with Capital Economics Ltd. in London, predicted annual growth of 4 percent for the next five or 10 years.

“At the end of the day Africa is still huge, and it has a growing population and massive natural resources,’’ Ashbourne said. ‘’There will always be opportunities.”

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Amman Design Week: Arab talent on display

27 October 2016 Comments (0) Featured, Middle East

Jordan’s inaugural Amman Design Week showed that creativity could flourish even in times of change and challenges that include rapid urbanization and the influx of more than 600,000 Syrian refugees. Organizers said the design festival in the Jordanian capital of Amman drew about 30,000 visitors during a nine-day run that ended Sept. 9. It had the support of Jordanian Queen Rania Al Abdullah.

More than 100 designers, architects and artists displayed their work at the event, which also included a MakerSpace that offered classes in 3D printing. The event showcased creativity in a variety of artistic fields, including design, architecture, furniture, fashion, crafts, and digital media. In addition to exhibits, it included lectures, workshops, and tours. Sahel Al Hiyari, an architect who helped curate the exhibits, said design is a way to cross boundaries, whether mental or geographic. “When these boundaries are transcended, we get something more unified.”

Everyday objects provide highlights

The festival spread across three major locations with three dozen smaller exhibits, many of which reflected everyday life in Amman. For example, Sissel Tolaas, a scientist and artist, potted the city’s smells –everything from jasmine blooms to trash – and built a scent map. Another artist, Dina Haddadin, created displays using scaffolding and tarps used in construction.

The Hangar, one of the event’s main locations, draws visitors into a webbed textile funnel made from large knitted tubes that visitors can peek through. A collaboration between a local fashion designer, Raya Kassisieh, and an architect, Nader Tehrani, the funnel was knit by women in small communities all over Jordan. After the festival, the knitted wool was to be refashioned into blankets for refugees. Other noteworthy works include The Glass Shaper, a collage of glass stacked in front of a mirror that refracts light. Ahmad Jallouk, who runs a small underwear ship in Amman and spends his spare time turning glassware into art, created the display.

Watermelon hills in courtyard

One of the most visible displays sat outside in a courtyard, a pile of curving watermelons that invited visitors to pose for photos while children ran through the stacks. Designed by Lebanese architect Hashim Sarkis and assembled to his specifications by two longtime Jordanian fruit sellers, the exhibit punctuated an important theme of Amman Design Week – finding surprise in everyday items.

The displays featured works from a number of other Arab countries including Lebanon, the United Arab Emirates, Kuwait, Syria, Bahrain, Iraq and Morocco. The event was a positive development at a challenging time for Jordan, which has seen a huge influx of refugees from the five-year conflict in neighboring Syria. Imad Fakhoury, Jordan’s minister of planning and international cooperation, said recently that the refugee population has put significant pressure on the country’s resources, particularly water, social assistance and finance, while curtailing tourism and foreign investment. The minister said the nation faces a shortfall of $2.8 billion in 2016-18.

Connecting talent is one goal

In addition to displaying deep and diverse creative talent to the public, Amman Design Week sought to raise the profile of designers and foster collaboration among them. Rana Beiruti, co-director of the festival, said she hoped the event would expose her fellow Jordanians to the tremendous talent of the country’s young designers and enable them to exchange expertise and ideas with regional peers.

Raya Kassisieh, a designer, saw an opportunity to raise the visibility of talent in the region. “Amman Design Week is an extremely important step to get the Levant area and Jordan specifically on the map of the design world. We are joining a really big movement and making a name for ourselves in the design industry internationally,” Kassisieh said. “I hope visitors from Design Week will help us spread the word about how much talent is at work in our region.”

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