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Japan pledges $30 billion in aid to Africa

25 October 2016 Comments (0) Africa, Featured, Trade

Japan recently promised $30 billion in aid to Africa, a pledge that comes in the face of a spate of major investments on the continent by rival China. Japanese Prime Minister Shinzo Abe announced the commitment at the sixth Tokyo International Conference on African Development in Nairobi, Kenya, Aug. 27. The meeting, previously held in Japan, was staged in Africa for the first time this year at the request of the host continent. Abe said the aid will be spread over three years and comes on top of $32 billion Japan pledged to Africa over five years starting in 2013. He said about two-thirds of that money had been put to use. With longstanding trade ties, Japan has a keen interest in Africa’s resources. That interest has intensified since the island nation began to import more oil and natural gas after the 2011 Fukushima disaster shut down nearly all of its nuclear reactors. In recent years, Japan has found a growing rival in China, whose One Belt, One Road trade policy focuses squarely on Africa, Central Asia, and the Middle East.

Funds for infrastructure, education and health care

The latest round of Japanese funding will be used to develop infrastructure and improve health care and education on the continent, Abe said. About $10 billion for infrastructure will be allocated in cooperation with the African Development Bank. It will include roads, ports, airports and power plants that are expected to increase the continent’s electric capacity by 2,200 megawatts.

The money will also be used to train 20,000 mathematics and science teachers throughout the continent, as well as 20,000 experts on how to handle infectious diseases. “Today’s new pledges will enhance and expand on those launched three years ago. The motive is quality and enhancement” Abe said.

Chinese promise $60 billion

Abe’s pledge comes on the heels of a Chinese promise of $60 billion in aid, much of it loans from Chinese banks or export credits rather than direct aid. With its One Belt, One Road policy of establishing trade routes in the West, China has stepped up its investments on the continent in recent years, although the Chinese economic slowdown has reduced trade and posed challenges for African economies that rely heavily on oil and commodity exports.

Still, China has continued to announce large investments on the continent. It plans to build a naval base in Djibouti along with expansions of port facilities and new airports at a cost of more than $12 billion. China will also fund a $4 billion rail link with neighboring Ethiopia. However, with its economic slowdown, China’s investment in Africa decreased by about 40 percent last year.

China dwarfs Japan in trade

Six years ago, China surpassed the United States as Africa’s largest trading partner. The Asian giant has also eclipsed Japan in financial importance to the continent. China’s total trade with Africa of about $179 billion last year dwarfed the approximately $24 billion in trade with Japan.

Japan’s overall direct investment in Africa totaled $1.24 billion in 2015, down from about $1.5 billion a year earlier, according to Japan’s External Trade Organization. China made a single investment of $2 billion in oil-rich Equatorial Guinea in the month of April 2015 alone.

Geopolitics in play

“Japan has a sense of rivalry with China, which has provided large-scale assistance,” Koichi Sakamoto, professor of regional development studies at Toyo University, said. “Since Japan can’t fight China in terms of cash, it needs to stress quality.” Abe said Japanese direct investment totaling $10 billion will begin to flow this year, along with another $20 billion in investment from Japan’s private sector.

In addition to it’s interest in Africa’s resources, Japan has strong political motives on both regional and global fronts for strengthening ties with Africa, according to Seijiro Takeshita, an economist and professor at the University of Shizuoka. For one thing, Japan is seeking support to become a permanent member of the United Nations Security Council. Japan and other nations in the region also see China as an aggressor. “This is basically (seeking) to ward off continuous aggression the neighboring nations feel from China,” Takeshita said.

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Iqbal Al Assaad: Palestinian prodigy, doctor

21 October 2016 Comments (0) Education, Featured, Middle East

As a high school graduate at age 12 and a medical school graduate at 20, Palestinian Iqbal Al Assaad is in every sense a prodigy despite many challenges. But her childhood dream to become a doctor and help Palestinian refugees is only partly realized. With limited opportunities for professional work in Lebanon, where she grew up, El Assaad instead practices medicine in Ohio – for now. El Assaad graduated from high school four years ahead of schedule at the top of her class including studies in biochemistry and mathematics she would need for medical school. At age 13, she caught the attention of the education minister of Lebanon, who helped her win a scholarship to study medicine in Qatar. In 2013, still only 20 years old, she became the youngest student ever to graduate from Cornell University medical school’s Qatar branch and possibly the youngest Arab doctor ever.

Opportunities for Palestinians limited

But since then, she has been unable to use her skills to help Palestinian refugees and offer them services by opening a free clinic for them in Lebanon. Medicine is one of several dozen professions from which Palestinian refugees are barred. Palestinians in Lebanon were allowed to take clerical and lower-level jobs starting in 2005 and allowed to work in some professions in 2010. But highly skilled fields including medicine are regulated by professional associations that impose strict membership restrictions in order to protect jobs for Lebanese nationals. These associations are concerned that Palestinians might overwhelm the labor market, “so they feel it’s about job opportunities for Lebanese nationals”, said Lina Hamdan, a spokeswoman for the Lebanese-Palestinian Dialogue Committee.

Refugee population swells with Syrian conflict

As the ranks of refugees grow in the Middle East, Al Assaad’s situation is increasingly common. The United Nations Relief Works Agency, estimates there are about 450,000 Palestinians in Lebanon and more than 90,000 have arrived from Syria since that country’s conflict began five years ago. While the UN agency provides primary medical care, it does not pay for more serious medical conditions, often forcing refugees to chose between forgoing treatment or going heavily into debt to pay for care. Growing up in Bar Elias, a rural village in the Bekaa valley, after her parents arrived in Lebanon, Al Assaad visited relatives in refugee camps and was struck at an early age by the poverty and lack of access to medical care.

Inspired to help refugees

Inspired to help, she pursued an education in math and science, which led to help from Lebanon’s education minister Khaled Qabbani in winning a full scholarship from the Qatar Foundation to attend Weill Cornell Medical College. Recognizing her accomplishment in graduating medical school and obtaining a prestigious residency in the United States, Arabian Business named her one of the 100 most powerful people under 40 in the Middle East in 2015.

Inspired to help refugees

Inspired to help, she pursued an education in maths and science, which led to help from Lebanon’s education minister Khaled Qabbani in winning a full scholarship from the Qatar Foundation to attend Weill Cornell Medical College. Recognizing her accomplishment in graduating medical school and obtaining a prestigious residency in the United States, Arabian Business named her one of the 100 most powerful people under 40 in the Middle East in 2015.

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Angola looks to hydropower, shipyards to boost its economy

19 October 2016 Comments (0) Featured, Transport

A major shipbuilding company based in the Middle East has forged a partnership to bring a shipyard, naval vessels and hydropower to Angola. Privinvest announced the launch of a major shipbuilding and maritime development project with the Republic of Angola in early September. The agreement builds on a previous pact to develop hydrokinetic power in the southern African nation. Both efforts are to be joint ventures of the government and Privinvest.

Under the latest agreement, Privinvest will provide a range of ships of the Angolan Navy. At the same time, the company will work with the British firm Simportex to develop and operate a shipyard in Angola. The modern shipyard will be able to build and service ships. In addition to supplying ships, Privinvest will provide state of the art technology to enable future construction of naval vessels in Angola.

“This marks a step in cooperation with one of the most dynamic economies in Africa,” Boulos Hankach, President of Shipbuilding Investments at Privinvest, said. “It shows that we have the skills and capabilities to promote high-level programs in countries around the world.”

Projects to generate 9,000 megawatts

In July, the government of Angola and Privinvest signed an agreement to bring hydrokinetic power generation to the country over the next 10 years. Angola wants to be able to generate 9,000 megawatts of power by 2025, with much of it coming from the capture of energy from water flows. The project will initially develop three test sites with a total expected output of 12 megawatts or more. The first site is expected to be operational next year. Privinvest will build hydrokinetic turbines and develop hydro-energy fields under the agreement. The Angolan public utility Prodel has agreed to buy all of the electrical output of the venture.

Joao Baptista Borges, Angolan minister of energy and water, noted that the country is a major source of untapped hydropower. With the introduction of new technology, it will be possible to produce low-cost energy for rural areas of Angola with the goal of providing access to energy to more than 14 million residents in the next decade.

Company based in Lebanon

Privinvest, based in Lebanon, has shipyards and other facilities in the Mediterranean region, the Arabian Gulf, France, Germany and the United Kingdom. The company was founded and is led by Iskander and Akram Safa, two French brothers of Lebanese descent.

Long a global leader in shipbuilding, the company designs and manufactures naval and commercial vessels as well as luxury yachts worldwide. Privinvest also provides technology and training to countries that want to develop their shipbuilding industry along with logistical support and supply management, training and supply management services for navel fleets.

Privinvest said its shipyards have produced more than 2,000 vessels and more than 40 navies use its ships globally. Currently, the company is working with six national navies in addition to private customers.

The company began working in hydrokinetic power in 2012 with affiliates that manufacture turbines for use both in rivers and at sea.

Angola hurt by oil slump

Angola, meanwhile, is under pressure to diversify its economy. As the second-largest oil producer in Africa, the nation has been hard it by falling crude prices. Last year, the World Bank agreed to give the country $650 million in financial support – a loan of $450 million and guarantees amounting to $200 million – to help stabilize its economy, the first such aid to Angola since 2010. Even with the aid, the government was forced to cut its budget by 25 percent while its currency lost 15 percent against the dollar. Nonetheless, growth in the country’s gross domestic product was nearly 5 percent in 2014.

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Peter Njonjo : from a top IT job to BBQ!

15 October 2016 Comments (0) Africa, Business, Featured

Peter Njonjo made a risky decision last year. He left his top IT job at the European Union to launch his own prepared meats company, Gregos Foods. He says he was compelled by his love of cooking and his search to finding high-quality barbecue products in his native Kenya. He explained: “Kenya has the best meat in terms of the world, but what we are actually getting in terms of retail is not the best. I thought we could do better so we started off.” In just over one year he’s gone from a backyard conversation to seeing his products on supermarket shelves. This is a massive achievement in a country that is dominated by one industry leader: Farmer’s Foods, which has an enormous 44% of the market share. Avid cooks, Njonjo and his friends were inspired to make their own meat products by a lack of processed meats available in stores. They realized there was a gap in the market and that their homemade products were in demand and could be produced on a larger scale. He conducted a vast amount of market research and customer testing before deciding that this was a viable business. They created products such as goat sausages, bacon and beef burgers and wrapped chicken thighs, which were all extremely popular with their product testers. Although he initially knew very little about this industry, he was determined to make the company a success.

Smart business decisions that have led to success

Seven months later the first factory was opened. There were a number of factors that determined the success of the company, most of which were related to Njonjo’s business acumen and sharp, academic mind. First, he chose to rent space in an already operational factory that was running under capacity instead of an expensive new build. This factory was located in Kikuyu, a small agricultural town about 20 km outside of Nairobi. It was a central location for distribution, but considerably cheaper than renting inside the capital city, and much closer to the meat producers they would rely on. Next, he reached out to his network of friends and ex-colleagues for assistance in areas that he lacked specific expertise, such as HR, finance and marketing. This avoided expenses on external consultants services, and reduced the startup costs considerably. They relied on social media marketing, local events and word-of- mouth for publicity and slowly built a loyal consumer base through their home and business deliveries. They eventually broke into retail and secured deals with supermarkets to stock their products.

Savvy spending of profits, brand awareness and driving sales

He explained that they don’t expect to make any money in the first year, offering deals to spread brand awareness and ploughing profits back into increasing production capabilities. The company also elected to use influencers and food bloggers to drive sales and publicity. The biggest challenge, says Njonjo, is competing with industry leaders, who have significant visibility and customer loyalty. The focus has been maximizing their exposure to challenge these market leaders, something many competitors/newcomers have failed to do in the Kenyan food industry.

The future for Njonjo and Gregor Foods

After just one year in business, “Gregos Foods” is booming. The company has plans to expand its manufacturing capacity to meet growing demand and have recently expanded into wholesale, as well as catering for hotels and restaurants. The long-term goal is to expand into the export market, supplying products to neighboring African countries, and even beyond. They intend to collaborate with other small-scale producers who have unique recipes and are looking for production and distribution partners. This could see Gregos Foods growing into a parent company for a number of different producers, while at the same time helping other people like Njonjo who had a plan/an idea but struggled to compete with dominant giants in the food industry. His advice to other entrepreneurs is to be realistic about the market: “Give yourself time to grow, go for what you can do best and ensure that you add value as opposed to being ordinary.” With the rise of food and manufacturing entrepreneurs across the continent, people like Njonjo have been encouraged to follow their dreams. Although he has no experience in the in food industry, his business expertise has enabled him to succeed where others have failed.

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With fiber optics, Ivory Coast seeks to become a tech hub

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

Pushing its nascent digital economy to catch up with its booming commerce, Ivory Coast is investing $165 million to lay more than 3,000 miles of additional fiber optic cable. The West African nation has already installed nearly 400 miles of fiber optic cables and planned to add another nearly 900 miles this year, according to Andre Augustine Apete, Minister of information and communications technology. When the work is completed, the country will have more than 4,000 miles of cable, about one-fifth of its goal of more than 12,000 miles. As Ivory Coast emerges from a decade of political turmoil, the government has adopted an ambitious agenda of investment in infrastructure that has driven economic growth to about nine percent during the past four years, one of the highest growth rates on the continent. While commodities-reliant economies elsewhere in Africa have slowed, Ivory Coast posted growth of 8.4 percent for its gross domestic product and projects growth of 8.5 percent this year, according to the World Bank. The country has seen large increases in overall production, particularly in agriculture, as a result of regulatory reforms, public investment programs and infrastructure development.

Mobile banking, shopping boom

The world’s top cocoa producer, Ivory Coast has also experienced a boom in digital activity driven by mobile banking and shopping that total nearly $2 million profits a day, outpacing traditional banking. “I don’t think all our banks put together are doing as much”, Apete said. However, the government has more ambitious plans to grow the emerging digital economy, which today directly or indirectly employs about 150,000 people out of the country’s population of more than 20 million. Until recently, mobile access has dominated the marketplace with more than 85 percent penetration, while the internet and broadband sectors have been largely undeveloped in the Ivory Coast.

High costs limit development

High international bandwidth costs played a major role in limiting development because the unique submarine fiber optic cable served merely Ivory Coast. With the landing of a second cable in 2011 and as many as three additional cables expected to be added, prices have begun to decline. Another major development in Ivory Coast was the introduction of 3G mobile services in 2012, with the launch of the first 3.5G mobile broadband service. The wide geographic reach promised by 12,000 miles of fiber optic cable is intended to position the country to develop a booming digital economy. Fiber optic cable is much less expensive than copper wire, and, importantly for digital communications and data, it has a higher carrying capacity and provide fastest broadband connexion.

Ivory Coast aims to become a regional tech hub

Innocent N’Dry, head of new technologies, innovation and services development at Ubifrance in Abidjan, said the Ivorian government wants the country to become a regional hub for communications and information technology. The sector has seen sustained growth in the past decade, and it was one of only a few countries in West Africa that obtained 3G coverage by 2012. However, the lack of a fiber-optic network has held the country back at a time when technological entrepreneurship is emerging. “In terms of young companies and new technologies, there is real entrepreneurial dynamism, with the creation of incubators,’’ N’Dry said. He cited development of the Orange Technocenter in Abidjan, where marketing, research and engineering teams develop new products and services for the Orang telecommunication company’s customers.

Support for startups is key

N’Dry said Ivory Coast is emulating a model from Senegal in which the government provides support for young companies. To encourage new digital businesses, the Ivory Coast government implemented a free zone dedicated to information and communication technology companies. More recently, the government in July announced a fund of more than $260 million to strengthen the infrastructure for tech innovation and to support tech companies, especially startups. The fund, created with support from the African Development Bank, will also be used to help establish networks of investors and to train entrepreneurs from Ivory Coast and other countries in the region.

Mobile improvements sought

While the Ivory Coast government seeks to develop broadband capacity, it is also moving to encourage improvements in mobile services. This year, Ivory Coast will limit the number of operating licenses for telecoms to four. Three companies, which account for 96 percent of the country’s more than 20 million mobile subscriptions, will be re-licensed. They are France’s Orange, South Africa’s MTN and Mov, which was sold the Morocco Telecom by the United Arab Emirates’ Etisalat in 2014. At the same time, the government said it was withdrawing the licenses of several smaller mobile operators, stating that they had not paid for due taxes and fees. Apete said smaller companies might have the opportunity to merge into one single company controlled if a new majority shareholder emerges. “We are leaving this fourth place free in case a significant operator comes in tomorrow and says it’s interested. Those companies can then join with it”, Apete said.

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African Union launches electronic passport for the continent

11 October 2016 Comments (0) Africa, Featured, Trade

Seeking to boost trade, tourism and investment, the African Union has launched a common electronic passport that the organization hopes eventually will give holders visa-free access to all of the organization’s 54 member nations. The African passport initially is being made available to heads of state and diplomats. The goal is full use by all citizens by 2018, although because of complicated logistics that aim is far from guaranteed. The passport, launched in July at the 27 th African Union Summit in Rwanda, is part of the African Union’s Agenda 2063 plan to develop a more unified “One Africa” economy on the continent in order to boost development and growth. Officials say the common passport is aimed at facilitating free movement of people and goods around the continent as a way of fostering intra-African trade and development.

One step toward economic integration

The passport “is a steady step toward the objective of creating a prosperous and integrated Africa,” outgoing African Union chairman Nkosazana Dlamini-Zuma said at the launch. The African Development Bank has been a strong advocate for the common African passport, noting that cumbersome visa requirements in many countries limit intra-African tourism and make trade between African countries cumbersome and expensive. “African countries are closed off to one another, which makes travel within the continent difficult,’’ the development bank said, noting that the continent has some of the toughest visa restrictions in the world. Moreover, restrictions are particularly high from Africans traveling within the continent compared to European or North American visitors, the bank said, noting that business visas are more difficult to obtain than tourist visas. The cost of visas places a burden on citizens who would travel or do business across borders. According to the bank, Central Africa, the region with the highest use of traditional visas, is the least connected to other regions. At the same time, East Africa, with the highest number of visas available on arrival, is among the most open regions in the world.

Benefits in Rwanda cited

Rwanda, which allows entry visas for all African citizens who come to its borders, has seen a 24 percent increase in tourist frequentation from other countries on the continent since it loosened requirements in 2013. The African Development Bank estimated that easing visa requirements could generate an additional $200 billion in the tourism sector and create as many as 5 million new jobs. The bank also said visa restrictions limit the ability of businesses to attract and retain the best African talents, saying that the lack of mobility of professionals is impeding economic growth. Emerging fields such as banking, mining and information technology in particular require more flexibility to compete in the marketplace. A new Visa Openness Index developed by the bank in support of easing restrictions concluded difficulty for business travelers was underscored. According to the index report, more than half of the 55 countries ranked require visitors to obtain visas in advance. Only 20 percent do not require visas and only 15 percent offer visas on arrival. Moreover, many of Africa’s strategic hubs have more restrictive visa policies while smaller nations tend to be more open.

10 countries stand out for openness

The top 10 nations for openness posted an average score of 0.86 (out of 1) on the ADB index, twice the overall average. The top 10 countries are Rwanda, Seychelles, Mali, Cape Verde, Togo, Guinea-Bissau Mauritania, Mozambique, Uganda, and Mauritius. At the bottom of the rankings were Eritrea, Ethiopia, Sudan, Angola, Gabon, Libya, Egypt, Equatorial Guinea, São Tomé and Príncipe, and Western Sahara.

Access to biometric systems not assured

While the African Union wants full implementation of the new passport by 2018, the logistics of that timeline are daunting. Each country can decide when to begin accepting the new passport. But many nations do not have access to biometric systems that are required to access the electronic passports. Despite the challenges, advocates say the transition to a common passport is a vital part of the goal of “One Africa,” embodied in Agenda 2063. Visa “restrictions harm our integration efforts, negatively affecting tourism, investments and trade. A more relaxed visa landscape could help push our shared vision of one competitive African market,’’ said Moono Mupotola, manager of integration and trade at the African Development Bank. “To encourage intra-African trade, without a doubt, we need to work on visa openness.”

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Prosperous brand new african car market 

7 October 2016 Comments (0) Africa, Featured, Transport

Second-hand cars have been winding their way to African markets for many years. A road trip from Europe West Africa to sell your used vehicle has long been synonimous with both adventure and profits. It has remained uite easyt to find major export-import enterprises that will whisk your used car away to Africa.

Motorization ripe to take off across Africa

In addition to European car makers both North America and the Far East send second-hand vehicles to the continent en masse. The market is thoroughly established today: according to the consulting cabinet Deloitte an overwhlming majority of the 42.5 million vehicles on use on African roads today come from second-hand exports. This trend is likely to increase. Africa is the least motorized region on the planet with only 44 registered vehicles per 1000 inhabitants. The global average on world scale stands at 180 vehicles per 1000 which paves the way for tremendous growth of African market in the future. Demand for used cars is soaring due to an emerging African middle class and an improving economic climate.

Nigeria takes the lead

Nigeria is the biggest car market in Africa, and is also one of the most affluent in the Sub-Saharan region. The country boasts a population of over 140 million with approximately 40 million currently belonging to the rapidly emerging middle class. While new car sales are slowly picking up across the country, used sales still best those of new vehicles by a ratio of 4:1. In Nigeria, car ownership is seen as aspirational, whereas in the western world only new, high end cars represent a genuine status symbol. However for the burgeoning Nigerian middle class, car ownership itself is a highly coveted distinction. While the highly affluent will choose to buy new cars, Nigeria’s used car market is expected to grow for the foreseeable future.

Grey market evolves in Benin to meet Nigerian demand

Benin has dramatically benefited from the of Nigeria car market when Nigeria places high tariffs on the importation of used vehicles far above that of Benin. However this loophole is soon likely to close given that both Benin and Nigeria are working on a single import tariff for the block. Similar to Nigeria, Kenya has a large population and an emerging middle class. Citizens have been readily buying used cars, aided by the country’s strong banking sector that offers attractive lines of credit. In 2015 used cars outsold new cars by a ratio of 5:1, and according to forecasts this ratio is expected to be maintained for many years.

Kenya, Uganda and Tanzania look towards Japan for quality used vehicles

Japan has a strong record of car export, driven by tight environmental regulations and high service costs that incentivise any citizens to sell their car merely after few years. Japanese models such as Toyota and Nissan are fanatically popular across Africa due to reliability, strong 4×4 models, fuel economy and comparatively cheap repairs.

Many of Kenya’s neighbors such as Uganda and Tanzania are also seeing a surge in the second-hand car market. Given that Kenya has the largest port in East Africa it is likely to become the main import hub for Japanese second-hand cars, creating jobs and businesses throughout the region. Ultimately, apart from South Africa and the North African countries the rest of the continent is going to fce with a major increase in demand for second-hand cars over the coming years as economic conditions keep improving. Some estimates suggest that by 2030 car ownership will more than double to reach a healthy number of 90 million registered vehicles.

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Zimbabwe’s optimistic growth forecasts as economy stumbles

5 October 2016 Comments (0) Africa, Agriculture, Economy, Featured

Despite an unstable economic context , the embattled government of Zimbabwe is putting on display ambitious growth targets for the next two years. The government recently projected an annual growth rate of 6.5 percent between 2016 and 2018.

That forecast contrasts with small economic growth rates in recent years jeopardising  President Robert Mugabe’s legitimacy. Mugabe, the world’s oldest state representative aged 92, has been in office for 36 years now. Finance minister Patrick Chinamasa had originally forecast an economic expansion of 2.7 percent in 2016. But Chinamasa was forced to cut the target by nearly half, to 1.4 percent, in the face of the negative impact of the drought and falling commodity prices worldwide.

Cash shortages plague nation

Zimbabwe’s economic challenges include cash shortages, its worst drought in decades, heavy reliance on imports, crippled agricultural and manufacturing sectors, a drop in tourism, and worker strikes that have paralyzed key sectors. “What you have are highly incendiary conditions in Zimbabwe,” said Charles Laurie of the political risk firm Verisk Maplecroft. The nation is “ripe for a power grab.” Mugabe has cracked down on opponents and the government in August increased its surveillance of social media and cellphone channels while the military went on high alert in the face of what it said were potential cyber-terrorist attempts to destabilize the government. But the government cash shortage is evident prompting a government decision to start issuing bond notes that some see as a shadow currency. For the past two months‚ the government has been late in paying the military‚ police and other public workers. Zimbabwean banks have restricted the amount of cash that can be withdrawn, sometimes allowing only $20 per day.

Financial crisis recalled

Some experts say the country may be headed into its worst financial crisis since 2008-2009, when Zimbabwe dropped its national currency in the face of hyperinflation that reached 500 billion percent. The United States dollar, South African Rand and recently the Chinese Yuan, have been introducedd by the government as acceptable currencies in Zimbabwe. However, the government plans to introduce bond notes has sparked fears that large government issues of the notes will effectivelynamount to printing more money – a move that could drive inflation.

Weak signs of recovery

Zimbabwe was on the road to recovery in 2010-12 after a disastrous land reform initiative, and annual economic growth topped 10 percent in 2012. However, since then, growth has trended downward – 4.5 percent in 2013, 3.1 percent in 2015 and only 1.5 percent in 2015. The government said agriculture, fishing, manufacturing, and construction, would help drive growth in the next two years. At the same time, the government forecast targeted annual inflation of less than 1 percent and a budget deficit of 1.2 percent of gross domestic product in 2017 and 2018. But a number of key Zimbabwean economic sectors are highly challenged. Agriculture, the backbone of Zimbabwe’s economy, lacks funding and farmers are straddled with strict loan requirements driven by banks’ concerns about security for 99-year leases of many farms. The government is counting on receiving $5 billion from China to revive the agricultural sector. The nation hopes that China will provide funds for farmers to grow tobacco, flowers, cotton, and soya beans and to breed beef cattle.

Food imports increase

In the aftermath of dramatic drought the government was forced to import more than 700,000 tons of maize adding to the country’s trade imbalance, which hit $3.3 billion in 2015. The manufacturing sector is currently hampered by obsolete equipment and power shortages as well as intensifying competition from cheaper imports. Currently, the sector has reduced production and is operating at about one-third of its capacity. A requirement that foreign investors sell controlling equity stakes in their companies to local residents has further dampened enthusiasm for investment. Direct foreign investment dropped by nearly a quarter in 2015 to $421 million. The decline was attributed to assessments showing high levels of corruption as well as bureaucratic red tape.

Tax costs tourism dollars

Tourism has also declined because of a ban on ivory imports and a 15 percent tax on accommodations and tourist services. A report by the Zimbabwe Council for Tourism report said the nation lost more than $100 million in tourism revenue last year because of the tax. Experts dispute the nation’s ability to meet the new economic growth targets. John Robertson, an independent Zimbabwean economist, said it was unlikely that funding from abroad would revive the economy. Oswell Binha, an economist and chairman of Buy Zimbabwe chairman said the economy, which is at risk of recession, simply does not have the capacity to grow at a rate of more than 6 percent. “Zimbabwe under its current circumstances will never achieve any growth beyond 4 percent,” Binha said, as a result of the country’s inability to maximize key drivers of its economy.

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West African seed exchange to increase agricultural production

3 October 2016 Comments (0) Africa, Agriculture, Featured

Officials are touting the launch of an electronic seed exchange in West Africa as an important step in improving productivity and food security. The online platform will serve seven West African countries – Benin, Burkina Faso, Niger, Ghana, Mali, Senegal and Nigeria. The platform is based in Abuja, the capital of Nigeria, the leading producer of seeds in the region. Officials hope the new platform will contribute to agricultural productivity. They want to double high-yield seeds from 12 percent in 2012 to 25 percent by 2017. The electronic platform aims to provide an online point of connection for seed producers, traders, distributors, farmers, researchers and other industry stakeholders. In the long run, the platform could help improve the practice of seed quality analysis and the official catalog of seed varieties.

Exchange to boost trade

The platform will help promote the seed trade in the region while fostering healthy competition in the marketplace, said Philip Olusegun Ojo, director general of the Nigerian Agricultural Seeds Council. Ojo noted that about 70 percent of the seeds used by farmers in West Africa are produced in Nigeria. Regulatory changes have boosted the country’s seed industry, Ojo said, and today more than 155 seed companies operate in Nigeria. The electronic platform will provide farmers with information on the origin of seeds and their country of availability. The West and Central African Council for Agricultural Research and Development has developed the program in cooperation with the West African Agricultural Productivity Program.

Seeds key to improving a country’s agricultural production

Abdou Tenkouano, executive director of the council, said Nigeria has the capacity to supply nearly two-thirds of the farmers in West Africa need. Tenkouano said that the platform was designed to become a hub that will be a precursor to regional research and development initiatives in agriculture. Heineken Lokpobiri, minister of Agriculture and Rural Development, said seeds are key to food security in Nigeria, which spends more than $6 billion annually on food imports. “The objective of achieving food security can only be realized through the availability of quality seeds,” Lokpobiri said, noting that more companies should be encouraged to enter the seed market as the nation attempts to diversify its agriculture. According to Lokpobiri, the quality of Nigerian seed has improved while production has increased from about 5,000 metric tons in 2007 to 173,000 metric tons in 2015, mostly maize and rice seed. Revenue increased to more than $70 million. “We were able to achieve this success through enhanced collaboration with research institutes, liberalization of foundation seed production, strengthening of the national seed certification, as well as total withdrawal of government agencies from certified seed production and marketing,” he said.

Agriculture major occupation

Agriculture is a major sector of the Nigerian economy, engaging more than two thirds of the workforce and accounting for about a third of the nation’s gross domestic product. Major food crops include beans, sesame, cashew nuts, cassava, cocoa, maize (corn), millet, rice, soybeans and yams. Small farms that are generally widely scattered produce about 80 percent of the food. More than 75 million acres, about a third of Nigeria’s land area, are under cultivation. The new seed exchange platform may help improve constraints highlighted in a report last year that said Nigeria’s seed industry was underperforming. The study said the industry was hampered by weak technical capacity, inefficient enforcement of seed laws, information disconnects and lack of capital investment. The report said Nigeria must assure that farmers have access to new varieties of seeds of high quality and at affordable prices. “Unfortunately, the Nigerian seed industry has not fully developed the capacity to perform this role very well.”

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Thato Kgatlhanye and her “upcycled” solar powered schoolbags

24 August 2016 Comments (0) Africa, Featured, Leaders

Thato Kgatlhanye

Thato Kgatlhanye is a bright South African startup entrepreneur who is using innovation to benefit lives of local youths.

Thato Kgatlhanye is another shining tech star to come out of South Africa in recent years. Her passion for social change and empowerment is reflected in her landmark product: the solar powered school bag.

At age 18, Kgatlhanye founded Rethaka, literally meaning “we are fellows.” She set out with no concrete business plan in mind, just the idea that she wanted to do something that impacted young people and benefited underprivileged communities. Less than two years later, Repurpose was born.

Combining tech innovation and social motivation

Kgatlhanye had noticed that many children in South Africa walked to school carrying their books, or using plastic carrier bags. She was concerned that they frequently journeyed along busy roads, often late at night. Her vision was to create a practical book bag for disadvantaged students that could be low-cost and environmentally friendly.

Kgatlhanye and her business partner Rea Ngwane founded Repurpose with a $50,000 seed. The two childhood friends generated the startup capital by winning hard fought business competitions, and attracting corporate grants. They produced a prototype in partnership with an industrial product designer, before launching their brand of “upcycled” school bags. The bags are made from hundreds of reclaimed plastic carrier bags. They contain a solar powered battery element designed to charge on the student’s walk to school, and then emit light for up to 12 hours. Not only are these bags strong, durable and waterproof but they also come in many bright and unique designs and are made from high visibility materials.

Utilizing waste materials

The bags were designed with three core concepts in mind, forming the cornerstones of Repurpose’s success.

The first is its recycling element, which helps to alleviate Africa’s plastic crisis by upcycling collected carrier bags into a useful end product. Repurpose sets up “PurposeTextile” Banks for locals to deposit used plastic bags, taking them out of the environment ready to be made into repurposed bags.

The second is the bags’ durability and practical nature. They are long lasting, waterproof and available in bright colors. They are also made out of a highly reflective material in order to be more visible to vehicles. Three children are needlessly killed every day on dangerous South African roads, often walking to and from school along roads not built for pedestrian travel.

The final element is the solar powered light. The solar panel charges on the student’s walk to school and then can be used as a lantern for up to 12 hours of light. Many children cannot study once it gets dark as their families’ cannot afford candles or kerosene. Furthermore, around 3 million people are killed globally each year from accidents and illnesses involving kerosene and other temporary light sources.

Repurpose bags

Upcycling, generous donors and low-income families

Repurpose seeks out “Giving Partners,” who are matched with low-income schools that pay for a consignment of bags. Although Rethaka is a for-profit, women-owned business, they profess to do “what is right, not what is easy,” and their ethos is focused on generating profits, jobs and empowerment in otherwise struggling communities.

A recent graduate in Brand Management from Vega University, Kgatlhanye is enjoying her business success at a very young age. Her company has now dispensed over 10,000 backpacks, with plans to roll out further development and promotion of her bags. Repurpose has significant potential for the rest of Africa. Kgatlhanye has expressed a desire to extend her project across the continent, where it can save lives, benefit the environment and benefit children on a far grander scale. They intend set up more workshops in other African countries over the next 5 years, creating jobs and extending their reach. They also want to partner with large organizations like UNICEF to distribute the bags on a larger scale to identified African communities.

But Kgatlhanye is setting herself even wider targets. After identifying a new market, her next project is a range of luxury bags to be sold in the western world. This will be on a one-for-one model, donating one backpack for each bag sold. At just 23 years old, she is part of a new generation of change makers in South Africa. These individuals are utilizing their business acumen, entrepreneurial ideas and commitment to social progress for the greater good.

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