africapractice

Egypt falls off the grid

2011-01-28T12:55:00.003Z

I’ve been catching up on Twitter feeds from and about Egypt and the communications shutdown. Most updates are from 13-15 hours ago, then silence from Twitter inside Egypt. Absolutely incredible the speed at which the government shut providers down. And this blog post is undoubtedly already out of date.

http://farm6.static.flickr.com/5292/5394246995_11ac170497_b.jpg

A look at the Twitter feeds reflects the dissention and despair at what has happened – accusing mobile operators of “colluding” with the government.

Vodafone releases a statement, which read:

All mobile operators in Egypt have been instructed to suspend services in selected areas. Under Egyptian legislation the authorities have the right to issue such an order and we are obliged to comply with it. The Egyptian authorities will be clarifying the situation in due course

It’s impossible to get any information on the ground, given there are no phone lines, no Internet connections and no way to access services, like Facebook or Twitter, in or out of the country. It makes it much easier for rumours to fly and doubt to come in as to whether mobile operators were forced, agreed to, were threatened to close off their networks..

You suddenly realise again how dependent we have become on communication channels and how we rely on information sources online and across networks.

It seems the Internet went first, with mobile calls and SMS stopping. It was still possible to access Twitter and Facebook on mobile devices, until all of those services were shut off too.

A few links to some stories below, but changing so fast, these are really only background info now.

However, I think this will be a case study and a point of discussion for some time to come. While Tunisia was hailed as a result of youth, citizen activism, driven by social media and mobile connectivity, Egypt shows that the power can still be shifted by turning off the source.

It’s a developing story, but one that is currently only able to be told from the outside.

http://techcrunch.com/2011/01/27/blackberry-internet-service-reportedly-blocked-in-egypt/

http://www.engadget.com/2011/01/28/egypt-enters-communication-blackout-with-disruption-to-internet/

http://www.wired.co.uk/news/archive/2011-01/28/egypt-internet-down?utm_medium=twitter&utm_source=twitterfeed

http://www.renesys.com/blog/2011/01/egypt-leaves-the-internet.shtml

Book Launch: 'The New Harvest: Agricultural Innovation in Africa'

2011-01-19T14:31:00.006Z

On Monday 17th January africapractice attended the UK launch of Professor Juma’s latest work ‘The New Harvest: Agricultural Innovation in Africa’. Calestous Juma is Professor of the Practice of International Development, and Director of the Science, Technology and Globalization Project at the Belfer Centre, Harvard University. ‘The New Harvest’ is both ambitious and optimistic as Juma sets out the opportunities available for Africa to ‘feed itself in a generation’.

Addressing the audience, Professor Juma began by stressing the importance of agriculture in Africa, not just as a sector within African economies, but often as the key one. He also highlighted its interconnectivity with other policy areas and economic sectors, meaning that if current opportunities are harnessed successfully the potential impact will extend beyond the agricultural, but also that in moving the agricultural sector forward it is necessary to ensure the involvement of other sectors and actors. For example, by improving efficiency in farming poverty relief may be effected, given that the poorest are often farmers. However, improvements to agriculture can be made by making improvements in other areas, for example improving transport networks to key trade areas. Juma pointed to the example of President Bingu wa Mutharika of Malwai who, by taking on the role of Minister of Agriculture and Food Security as well as the Presidency, demonstrated the wide ranging importance for the Malawian socio-economy of its immediate agricultural development.

In acknowledging the strong role agriculture has to play in Africa’s development Professor Juma rejected the idea of a linear trajectory for economic development that claims countries transition from agricultural, to industrial, to service based. Both Juma and the panellists stressed that agriculture should not be viewed merely as a stepping stone to other development, but appreciated for the value it can bring in itself.

In the book itself Juma identifies and explores three key opportunities for the transformation of the agricultural sector in Africa going forward. Firstly, he argues that there are significant gains that can be made through regional cooperation. In particular Juma discussed the ways in which cooperation between various ministries and sectors could be beneficial both within and between countries. Secondly, he championed the opportunities that technological innovations and scientific advancements present for increasing efficiency, and protecting against risk. For instance, he cited the example of farmers using text messaging to pass on weather updates. Finally the professor stressed the importance of encouraging and facilitating entrepreneurs within the African agricultural sector who would be able to find new ways to drive the sector forward using in-depth local knowledge, not necessarily relying on imported ‘wisdoms’ that are not always a ‘good-fit’.

This book is accessible, as well as timely, given recent advances, such as the development of drought and disease resistant crops and the spread of mobile technology. Its emphasis on the importance of structures and networks through which policy can and should be decided provides a context which should facilitate sound and appropriate decisions in African agriculture moving forward. Such an approach enables the book to have wide-ranging relevance in a continent characterized by its diversity, whilst the inclusion of plentiful case studies included provides practical insight at the policy level. The challenge ahead is significant if African countries are to make the most of the opportunities laid out by Professor Juma, but the outlook is positive if the interaction and coordination of individuals across both sectors and geographical boundaries can be managed.

Kathryn Brooks

Social Media vs Social Networking

2010-12-24T07:42:00.001Z

We all use social media and are part of social networks, “we tweet, we friend and we blog”, but I often ask myself do we really understand the distinction between the two? At first glance they seem to be the same, but after digging deeper I found out that they are as different as chalk and cheese. Understanding the differences makes it easier to decide how they will work better for individuals and businesses.

By Definition

Social media is seen as the “what”; a way of communicating. Information is distributed through this medium to a mass audience. All you need it a computer and an internet connection and you’re ready to go. Social networking on the other hand is the “how”. This is a platform for engagement between people who share the same opinions and ideas. It is a circle of friends, family and colleagues.

Interaction

The communication line in social media is one way. That is why social media is said to be a medium of delivery. Information is distributed to the audience for their perusal. There is no interaction between the distributer and the reader. This is completely different when it comes to social networking. Communication is very much two way, where the reader can leave comments on what has been posted. Facebook is a perfect example of this, users share their thoughts through posts and all those in their network can comment on it, thus creating a back and forth communication line.

Organisations seem to understand this notion and have taken advantage of it by having Facebook pages. There is one obstacle they are facing though, which is updating their pages on a regular basis. Organisations should consider having a designated person to monitor their various pages and offer responses to better relationships with their stakeholders.

Timely Responses

Unlike social media, responses on social networks are easy to track since the messages are between a network of people who share the same views. Conversations are of the same interest. This is much more difficult when it comes to social media. All because communication is one way and there is very less interaction amongst users.

The above mentioned are just some of the major differences I found in my quest to understand the two concepts. Despite them overlapping at times, they are quite different from each other. They can be used parallel to each other to create relationships, which will increase brand awareness for individuals or organisations. If it still not clear what makes the two different here are video clips to help clarify matters.

Social Media in Plain English

Social Networking in Plain English

Bright new dawn for Guinea

2010-12-22T17:02:00.001Z

Guinea entered a new era today; the first day in office for President Alpha Conde, who won a closely fought contest to become Guinea's first democratically elected president.

I returned from Conakry at the weekend. I was unsure what the mood in Conakry would be like - perhaps frenzied anticipation of a bright new future. In the event, I sensed that people are relieved. Guineans are relieved that after such a hard fought contest in which ethnic rivalries played a significant part, the country has remained united. Peace has been preserved. For this, great credit must go to the defeated candidate Cellou Diallo, and to the outgoing head of the transition government, Sekouba Konate. Guinea now has a revered democrat at its helm; a man whose record in opposition is as inspiring as his ambition for his country is practical. Guinea has a leader on a mission to reduce poverty and create jobs. From what I have read and learned of Alpha Conde - he is not prone to big vision statements, nor to petty politicking, nor will he have truck with white elephant projects; he is a man with a single focus, in the tradition of several African liberation movement leaders (whom Conde has met and worked with) - to improve the welfare of his people - jobs, electricity, roads, healthcare, education, water and food security. Companies who share this ambition, have a bright future in Guinea. Those who don't should leave the country now.

Conakry was spruced up and flags were placed on street lampposts to welcome foreign dignitaries for the inauguration ceremony on Tuesday. A proud nation has reason to be proud again. Marcus Courage

What’s up in Cancun and what’s the deal for Africa?

2010-12-06T07:55:00.005Z

From 29^th November to 10^th December, the 16^th Conference of Parties (COP16) to the U.N. Framework Convention on Climate Change (UNFCC) convenes in Cancún, Mexico to follow up on last year's summit in Copenhagen, where word leaders failed to negotiate an international, legally-binding treaty to curb harmful emissions of greenhouse gases.

There are low expectations for successful negotiations in Cancun. This is because people have lost faith in not only the ability for a political agreement and consensus to be made, but also in the process. And on Tuesday (30 November 2010), UNEP released a report that concluded those reductions committed to in the Copenhagen Accord, even if fully met, are only 60 percent of the reductions needed to stop prevent global temperatures from rising by more than two degrees Celsius above preindustrial levels – the point considered to be the threshold for catastrophic climate change which will expose millions to drought, hunger and flooding.

So even if an agreement is made at the end of Cancun, the commitments within it will prevent some of the worse case climate change scenarios playing out, especially since from day one of the negotiations, Japan stated that it explicitly will not have anything to do with a post 2012 Kyoto Agreement.

So where does this leave Africa? Ironically, the lack of trust in attaining a political agreement has shifted discussions to issues more relevant to Africa, specifically on finance, forestry, technology transfer and adaptation in general.

Scientists agree that the best starting point for adaptation is to be rich, though it is not foolproof: not even the rich can buy off all hazards. But wealth buys information and it opens up options. Resources help people adapt both before the fact, by reducing risks, and after it, by aiding recovery from harm. Wealth can create hedges against the effects of climate change. It is wealth that Africa, compared to the rest of the world is short of.

Fortunately, a key pillar of the Cancun negotiations is the establishment of a Green Climate Fund, which was agreed upon in Copenhagen – disbursing $30 billion in 2010 to 2012, and then $100 billion each year after that until 2020. Multilateral funds have been established before so it’s not as if the Green Climate Fund is charting new territory. However, the political sensitivities and the criteria countries will have to meet to access these funds are looking onerous.

If African countries want a piece of this pie, they will have to focus seriously on governance, transparency, monitoring and valuating their carbon emissions and sinks - a tough job for any country. It would seem that many African countries will need funding to build this capacity in the first place. All of this is feasible, but African countries need to now use these conferences and meetings to gather information, exchange knowledge, learn and build their expertise from the participants and get everything in place so that they are an attractive destination for new climate and development specific funds.

For more information on climate finance and to check out the flows and channels, visit the new platform created by the World Bank and UNDP to track climate-change related finance by region, focus area, sector or financing mechanism: http://www.climatefinanceoptions.org/cfo/index.php. And to be ahead of the games for the climate change negotiations in Durban, South Africa, the official COP17 website was just launched: http://www.cop17durban.com/Pages/default.aspx

Microfinance Meltdown?

2010-11-18T13:00:00.005Z

The microcredit industry has grown in size and scale thanks in most part to the success of Mohammed Yunus’ Grameen Bank, which now serves over 7 million poor Bangladeshi women. It is in India that a number of problems have been surfacing in the last year or so. And it’s a sizeable problem that could get bigger when you consider the size of the industry in Africa - 427 microfinance institutions in Africa, lending more than $4.8 billion to over 8 million people (Mix Market (Microfinance Information Exchange).

The New York Times today reports that Indian banks have about $4 billion tied up in loans – about 80% of all microfinance in India. They’re increasingly worried about their returns in the state of Andhra Pradesh, where politicians, angry at how microfinance institutions are profiting from the poor, have encouraged borrowers to stop repaying their loans.

It’s a slippery slope as banks stop lending to protect from the increasing risk of defaults, and action spreads from state to state and country to country. Despite new legislation to regulate how and when lenders collect, there is an increasing feeling that what started out as a social development movement has become more capitalist and cut-throat than Wall Street.

That’s true in Africa too. Microcapital.org reported in January 2009 that the Malawian government had decided to stop guaranteeing loans from MFIs, given the “exorbitant” interest rates, naming two institutions that did not report to the Mix Market and did not publish lending rates.

The Central Bank of Nigeria and the Nigerian Deposit Insurance Corporation (NDIC), in an attempt to audit and regulate the microfinance industry, simply shut down 224 out of 800 mcirofinance banks. Microfinance Africa makes the point that while regulation is needed, the reputation of the industry now needs work.

About 10,000 organisations around the world have lent about $25bn to about 20 million people. An article by the BBC cites demand could be as much as $250bn. In the same article, Kate McKee, senior policy advisor at the World Bank's Consultative Group makes a now-oft-heard comparison to the financial crisis - that strong investor interest in the US sub-prime mortgage market created incentives for unsustainable growth and aggressive lending and the microfinance industry must guard against repeating the same pattern.

The Centre for Global Prosperity has an interesting article looking at the two mindsets in the approach to microfinance – profit and altruism. While this is in the context of the controversial IPO of SKS Microfinance in India it is a global issue. Like shareholder activism, if borrowers start to feel they are being taken advantage of – whether through NGO, government or civilian intervention – those dream rates of 95% repayment might be on the way down.

But then so will the opportunity to get out of poverty for the millions of people who have so far benefitted from microfinance. Philanthrocapitalism is one thing – many corporates, banks and private individuals want to see some financial return in the work they are doing to create good. But in Africa, as in India, there has to be more weight on philanthropy. The WSJ quotes an interview with Mr Yunus: "Microcredit should not be presented as a money-making opportunity. It is an opportunity to make an impact on poor people's lives”.

Governance - a victim of crime?

2010-10-05T13:37:00.003+01:00

Governance is an important part of a nation’s brand, particularly with regard to attracting foreign investment. The annual Ibrahim Index of African Governance, looked upon as a credible calibration by the international community, was released on Monday, when South Africa saw its ranking move down to 5^th place due to high levels of crime, despite high scores in public management and most other areas.

Mo Ibrahim foundation board director Mamphela Ramphele commented that, "South Africa is in the Top 10 in every other category... but [with crime] we are lounging down there with the Somalians of this day and Zimbabweans. It's not a pretty place." In fact, in the personal safety sub-category, South Africa was ranked 44^th – still above Cameroon, Nigeria, Chad, Mauritania, Zimbabwe, Sudan, the Democratic Republic of Congo and Somalia, but not exactly where the country wants to be.

Crime’s been a target area in South Africa for the last twelve months, given the country’s hosting of the FIFA World Cup amid global concerns about safety. So why the drop? Is the issue policing, poverty or politics? Ramphele identified the root of the problem in the "political culture" of countries: "In our country, South Africa, we have fantastic policies but the performance doesn't always match the policies.”

She draws a parallel between business and government. Activist shareholders keep businesses in line. What we need is citizens’ involvement to drive better governance. But for that you need citizens with the same interest and stake in their government as a shareholder does. In a country where 95% of the population don’t pay taxes, 95% of the population have no reason to fight for a system that makes better use of their money.

But what does the future hold for driving governance, and who are the leaders who are going to ‘up’ the calibrations and raise the rankings on a pan-African scale?

The Ibrahim Prize for Achievement in African Leadership was not awarded in 2010 for the second year running, with no candidate that promoted excellence in leadership. It will be interesting to see how initiatives like the African Leadership Network build a more cohesive community of leaders for the community that might raise the rankings and compete for the award.

Meanwhile, does South Africa forge ahead trying to tackle crime in an isolated manner, or will the country use this as a benchmark for treating the root cause of poor governance overall?

Resource Rents: China & Africa

2010-09-24T15:42:00.001+01:00

This week the International Growth Centre held a three day conference at the London School of Economics and africapractice was there to hear the latest debates and discussions surrounding economic growth in Africa.

China’s presence in Africa has been a ‘hot topic’ for some time now, with questions surrounding the legitimacy of resource rents generating considerable controversy. However, with African countries weathering the tides of global recession better than their western counterparts the potential and future in Africa for business and development has once again been highlighted. As the continent begins to experience accelerating growth, with Nigeria predicting GDP figures of around 10% by the end of 2011/early 2012, it is increasingly important that international actors understand what impact China is having on the business environment in Africa, and get to grips with the implications of Chinese involvement for their own investment prospects. As Chinese investments appear to be overshadowing those of the West and the African Union looks to the East for economic partnership, such considerations cannot wait.

It was not surprising, then, to see that the nature and impact of China and Africa’s relationship was debated by experts such as Paul Collier, director of the Centre for the Study of African Economies, Oxford University, and academic co-director of the International Growth Centre, and Christopher Alden, a reader in the Department of International Relations at LSE at the IGC conference.

The talk itself covered various points of interest, considering to what degree Chinese investments, and in particular resource rents (which involve exchanging infrastructure commitments for resource rights), are producing positive results for Africa. There is certainly no denying the scale of Chinese investment, with Chinese FDI into Africa at more than US$5.4billion in 2008 and new projects and agreements being announced on an almost daily basis, or indeed their importance.

One especially interesting area of deliberation was sparked by the question of whether infrastructure is the key to Africa’s future economic development. As Chinese investment has focused on infrastructure in particular this question is central in establishing the potential for China’s investments to help Africans reap economic rewards in the future.

Although China has signed some contracts to build schools and health care centres the deals have more often been more narrowly focused round transportation networks and resource extraction technologies, which of course enable the Chinese to obtain and export their share of the minerals extracted as well as providing security of investments. Concerns regarding the importation of Chinese labour to complete these projects and the lack of integration of these workers in to African communities have limited the positive impact of these opportunities for the continent, although more recently some countries, such as Angola, have been able to negotiate awarding a percentage of subcontracts for each project to national companies. Nevertheless, some of China’s actions have raised more serious questions concerning human rights issues, for example concerning weapon sales to Sudan.

International reaction to China and Africa’s ‘relationship’ has been somewhat confused and mixed. Paranoia, however, has been central, with fears that Chinese investments in Africa might mean there will be no room left for other international investors to pursue economic opportunities and contracts in the region. Western actors also seem concerned China will act as a barrier, with African governments and companies preferring to work outside their colonial networks free from the conditions often imposed by financiers in the West. However, the continent has potential beyond acting as a base for resource extraction, which is something China has yet to fully appreciate. Thousands of entrepreneurs and innovators await the education, access to communication networks and financial backing necessary to get their business ideas started and enable the diversification of their economies.

Within many industries, including resource based ones, there will increasingly be more room for investors who pursue infrastructure development in its widest sense, who recognise the role of Africans in the continent’s development and who focus on building the trust that comes from being culturally aware and involved. These things will be essential to nurturing positive economic interactions across borders, and the key to Africa’s economic development in the next decade.

Kathryn Brooks

South Africa's Entrepreneurs

2010-09-17T15:40:00.004+01:00

I went along to a book launch at GIBS last night, for “South Africa’s Greatest Entrepreneurs”, published by Nigerian author Moky Mokura.

The book profiles “22 of the most successful and dynamic business visionaries” who have changed the shape of South Africa in their time. The entrepreneurs featured are: Sol Kerzner, Alan Knott-Craig, Koos Bekker, Herman Mashaba, Mark Lamberti, Adrian Gore, Raymond Ackerman, Pam Golding, Nkhensani Nkosi, Jenna Clifford, Whitey Basson, Mark Shuttleworth, Donald Gordon, Eric Ellerine, Natie Kirsh, GT Ferreira, Robbie Brozin, Carrol Boyes, Brian Joffe, Gary Morolo, Ndaba Ntsele and Anant Singh.

GIBS clearly has entrepreneurialism at the centre of its foundation, being the brainchild of Professor Nick Binedell’s entrepreneurial spirit. Working in the technology space in particular, how to find, fund and facilitate entrepreneurs is an ongoing discussion. I don’t think everyone is cut out to be an entrepreneur, (which is a good thing, in my opinion), but I do agree it’s an essential part of driving a developing economy, building new foundations for future businesses.

On Thursday night it was mostly a collection of white, middle aged men who took to the podium to describe their experience of being an entrepreneur in South Africa, and with limited time, the insights were also a bit limited unfortunately. Aside from the usual rhetoric about working 24x7, the high chances of failure etc., it was sometimes hard to tell the difference between a successful entrepreneur and a successful business leader.

What was great to see was that Moky had persuaded the profiled entrepreneurs who attended the book launch to donate an hour of their time to mentor an aspiring entrepreneur. That’s the real resource – the direct and dedicated insight, which will be incredible for anyone who bids and wins for that time. I guess even the genuine entrepreneur can still do with advice and direction from experience!

With that in mind, what was missing for me was the younger generation of entrepreneurs, the up and coming. I know the book is a reference tool to those who have succeeded over the years, but I also think that their stories have been told before, albeit not in this form in a single place. For me it’s about trying to find the entrepreneur that you haven’t heard of yet, who may have a new experience, different advice, given the environment that today’s entrepreneurs are working in is completely different.

Having said that, a book dedicated to South African entrepreneurs does at least show (to the outside world, the doubters), that the country is producing top-class talent, has the history of success and a foundation of knowledge to build on.

I think we all still have something to learn from these entrepreneurial titans, but I’d be intrigued to see what a different collection of people and experiences the same book might produce in five years time.

Paywalls – are they the future to the survival of electronic IP?

2010-09-06T13:05:00.002+01:00

Our content is valuable and good quality information, you should start paying for it!

The Times of London recently put up a pay wall on all information produced for their website; you will now have to subscribe to access its contents online. It cost you £1 to access the website for one day and £3 per week.

Blogger Jon Rodoff, wrote a brief history of paywalls (http://radoff.com/blog/2009/11/30/a-brief-history-of-paywalls/):

This article shows that the history of paywalls, although chequered, has produced some success stories. In 2002, Financial Times started charging readers for their online content, yet still managed to increase subscription rates – in fact, the FT achieved a 30 percent increase amongst online subscribers in 2009. While it is easy to take FT’s success as a great case study, it’s important to note that they focus mainly on corporate businesses rather than individuals and they hold a specific position in the market.

Wall Street Journal is another company that implemented a paywall for some of its online content. The paywall itself is only effective when you access the website directly, however one can still access content behind the paywall by going through Google links. So begs the question, has it generated expected revenues for the newspaper?

New York Times earlier this year also announced that starting January 2011, they would place some of its content behind a paywall. Some articles would be available for free, then to read further, subscribers would be required to pay a flat fee to access it.

This begs the question: with so much content on the internet would you want to pay to access information that is readily available on another website?

Early figures, and a study by Nielson Net Ratings (http://www.boingboing.net/2009/11/30/notes-from-a-news-si.html) shows that there has been a significant drop in the newspaper’s online readership since the introduction of paywalls. Like any other website’s success, traffic is essential, it determines the number of advertisers vying for space on a website. Sharing networks affect trends. A story gets shared, and generates a lot of traffic – but if a fraction of those new readers don’t keep coming back for more, will advertisers want to?

The first company to support Murdoch - owner and founder of News Corp, was Apple with the iPad, when it launched a paid iPad application that will support The Times. The Times is now selling full-page display campaigns in to its iPad app, for which readers pay £9.99 per month. This application offers specially designed Monday to Saturday editions of The Times to users, including most sections of the paper - which can be downloaded and read offline. With so much content on the internet will this new business model work? Rupert Murdoch certainly thinks so. He says the introduction of paywalls is vital for the future of journalism and the sharing of information online. Murdoch believes that more and more publications will follow this model to ensure the survival of their businesses.

Is this the future? The next months will definitely tell an interesting story!

Gabon knows how to celebrate! 50 years this week!

2010-08-20T16:01:00.003+01:00

Gabon, the Central African nation with a small population and big ambitions, celebrated fifty years of independence this week. 14 African heads of state joined President Ali Bongo Ondimba for the celebrations in Libreville. The day was marked with the opening of an Exhibition commemorating Gabon’s arts, culture and economy, as well as a military parade, fireworks and two concerts.

If you are unable to travel yourself to see the Exhibition in Libreville (it is open until November), then why not take a tour of the nation’s newly launched Virtual Museum of Culture and Arts. It’s well worth visiting -

http://www.legabon.org/livre/livredor_en.php

On the eve of the celebrations, the Gabonese government announced that it had recently signed infrastructure investment contracts totalling $4.5bn dollars. These foreign direct investments are expected to create 50,000 jobs.

A catchy song and music video were released too. View it here – the rhythm is contagious!

http://www.gabon50ans.ga/article/l-hymne-du-cinquantenaire

Extracts from President Ali Bono Ondimba’s Independence Day Speech:

History

We are commemorating the 50th anniversary of Gabon’s independence. For every one of us, it is a day to rejoice and celebrate our unity and peace.

I have the great honour today to recall the memory of the father of our independence, President Leon Mba, first President of the Republic of Gabon. Gabon and its citizens remain grateful to him for steering our country to independence. .

We must remember too President Omar Bongo Ondimba, second President of our Republic, who left us almost a year ago, and who was a great architect of modernity in our country. He consolidated our national unity and built our state on solid foundations, bequeathing us a great and significant heritage that we must protect and conserve.

Building the Republic

Beyond the festive nature of this great day, we should recall what Gabon was during colonisation: a simple site of exploitation of wood and mineral resources. At independence, Gabon inherited nothing. Almost everything needed to be constructed. We had to get to work resolutely, with little in the way of a framework available at that time, to establish a state and to endow it with modern infrastructure – schools, hospitals, universities, roads, ports, airports, railways etc..

Those are the achievements of the Gabonese - Gabonese by origin, by adoption or who have come from elsewhere and who have made Gabon their home. Through the many efforts and sacrifices of a nation, they have constructed with love and devotion, stone by stone, our country. Each has been able, at his time and in his own style, to give the best of himself to build a nation based on the essential values of union, work and justice – the foundations of our Republic.

National Cohesion/Collective Spirit

These values that have been bequeathed to us remain the key to our national cohesion and our continued political stability. Quarrels do happen and we do argue, but we always manage to remain united, thanks to the emphasis we place on what unites us rather than what divides us. It’s important to protect ourselves from the devil of division, especially ethnic division. In 50 years of independence, our country has forged and consolidated institutions of which can be proud.

Transition/Good Governance

Healthy governance is vital. The political transition we went through last year is the perfect illustration of the quality of our institutions and the calibre of the men and women who lead them. It’s an occasion for me to pay a great homage to Madame Rose Francine Rogombé who diligently oversaw and ensured such a smooth transition.

We must recognise the elders who initiated the construction of our country; they have done their share of the work. It is now for our generation to take up the mantle, without egoism, without sectarianism. We must adapt ourselves to a modern age and embrace competence, competitiveness, excellence, and a culture of good governance and selflessness.

Gabon ‘Emergent’

Conscious of the confidence you have shown in me and the challenges and the responsibilities I must meet, I propose that we construct a common future underpinned by a common ambition to transform Gabon into an emerging country like certain countries in Asia, the Americas and Africa, who have designed their own paths.

‘Gabon Emergence’ is not a slogan, a stylistic effect or magic invention. Those criteria that will enable us to develop into an emerging economy are objective and known. They include standards of education, economic performance, sustainable development, infrastructure development, human development and, notably, health. In this domain in particular, I’m encouraged by our achievements and the setting up of mandatory health insurance and the construction of an Institute of Cancer Research at Agondjé, which will permit us in future to treat cancer patients on our own soil.

Gabon’s Own Destiny

Blaming the coloniser is finished. Laying fault with others is finished. We are facing our own destiny, and no one can construct it for us. Development is not a tranquil river. It’s a process that challenges us; the way we think and act. We must break from the past to emerge stronger and to provide a brighter future for our children.
Realising this ambition requires sustained and continuous efforts, sacrifices even, from all and for a term far exceeding political mandates.

Economy

Gabon is able to meet the challenge of transforming into an emerging economy by 2025 thanks to the wealth and employment that our mineral reserves can create in all sectors. Combine these with knowledge and know-how and we begin then to realise our nation’s real potential.

Analysis shows that traditional engines of growth are in decline, particularly hydrocarbons. They cannot provide us with sustainable growth up to 2025. Our ambition for development as well as the necessity to diversify our economy forces us to find other motors of growth. In this regard, 4 sectors stand out: timber, metals, ecotourism and energy.

Developing our timber industry will created hundreds of thousands of sustainable jobs and will encourage the growth of new poles of economic activity on our territory. The contracts signed last week for the creation of a Special Economic Zone in Nkok are part of this drive and infrastructural work will start in only couple of weeks. ... Regarding metals, Gabon can leverage on its traditional managanese exploitation and on its reserve of iron to become a world leader in metal production. The opening next September of a petrol and gas institute at Port-Gentil signals the reinforcement of our capacity in this sector and our desire to develop a pole of excellence in these industries. We have the potential too for growth in the electricity sector, through the exploitation of our hydro-electric resources.....The plant being built in Poubaba in the South-East, the launch of a dam project on the Okano in the North, the plans for another plant at Empress Eugenie Falls in the south, all form part of a national integrated energy development plan that will span our whole territory and sustained our industrial development. Regarding tourism, our exceptional biodiversity and our policy of protecting our national parks underscores our ambition to become a destination for ecotourism. Equally, business tourism offers real possibilities.

Governance

But our ambitions will not be realised if we don’t put into place mechanisms of good governance. That means structures and solid institutions that are well managed and capable of taking on new challenges.

More than ever, we must advance a national programme of good governance. In order for that to happen we must look at the quality and the integrity of the men and women in charge of managing our public offices and state enterprises.

Rule of Law

Our relationship with the law must evolve, because it’s the law that will guarantee social equality and will neutralise future antagonisms. All of our work will be in vain if this elementary thing is not integrated. We cannot stand by and see important investments reduced to nothing by irresponsible and unpatriotic attitudes. No country that favours laxity, impunity, the diversion of public funds or disorder, develops. More than ever we must oppose deviant behaviours of another age, another era.

Infrastructure

Development must include our country in its entirety. I attach great importance to our transport infrastructure, which provides the arteries for economic activity and development.

My recent trip into the interior of the country has allowed me to better understand the needs and the expectations of our people there and gives me confidence in our decision to launch what constitutes the ‘backbone’ of our economy, that is to say, the Libreville-Franceville road, for which the finance is coming thanks to a partnership with some emerging countries that believe in the economic capacity of Gabon. In the same spirit of ‘opening up’ and of balanced development, I launched a month ago the construction of the road between Tchibanga and Mayumba, and the bridge over the Banio. This important site opens up real potential for the construction of a port at Mayumba and the Tchibanga Koula-Moutou Road.

Partnerships

I face the future with confidence. I’m counting not just on all of you to work with me, but also on our partners to help realise our great ambition to transform Gabon into an emerging economy. This is our ambition and our destiny.

During the last 5 decades we have united to build a nation. We had to be patient and determined and also to cultivate a culture of openness and cooperation.

We have been able to count on the support of all our partners, and at the forefront is France, whose traditional and historic proximity to us has enriched us in many cultural, economic and political ways. Through mutual respect and out of collective interest, our partnership has adapted to the demands of today

I would also like to say to our American, European, Asian and Arab partners, how much we continue to recognise their support, which takes many forms and which contributes in many ways to our enrichment and to our development.

Africa

To our brothers, our African friends. Without a shadow of doubt we remain here always at your side, to defend our dignity and our people. Resolutely convinced of our collective destiny, our country will continue ceaselessly to join in with the efforts of those other members of the African Union. On a regional scale, I share the idea that united together, we will meet the challenge of sustainable development together.

THE UN GOES GREEN!

2010-08-16T10:12:00.002+01:00

I never thought I would see the day when the United Nations took on board best practices from the private sector. However, this year, the UN launched it’s ‘Greening the Blue’ initiative which aims to raise awareness of the importance of sustainability throughout the UN system and highlight what’s been achieved, what’s happening next and how staff can get involved. http://www.greeningtheblue.org/

The UN Secretary-General’s call for all UN agencies, funds and programmes to become climate neutral and 'go green' on 5 June (World Environment Day) 2007, kick-started the systems and procedures to measure and reduce the environmental impacts of the UN family. Many of these systems and procedures, and how they are measured and reported against, have been taken from the private sector.

The website lays out the UN’s achievements very clearly and is an impressive platform. It’s not boring or too technical, with even a cute little cartoon video, starring characters call ‘Flip’ and ‘Norma’!

Granted, it was a UN agency that creating the Global Reporting Initiative and the UNFCCC is the world’s clearinghouse for climate change information. So I suppose we should not have expected anything less, and some have even argued why we had to wait so long for this initiative to have taken place. But I must admit coordinating and managing information from all 50 of its funds, agencies and programmes must not have been an easy feat. It makes me think that if the UN can implement this type of reporting, then there is no reason why large multinationals cannot demonstrate this level of transparency too.

The website also holds some useful resources for organisations and businesses to implement climate change related activities. One such publication is ‘Kick the Habit’, written for individuals, businesses, organizations and governments with the aim of helping to reduce our shared carbon footprint. Breaking down scientific jargon and simplifying policy documents, the guide provides readers with up-to-date information and actionable steps for helping to achieve climate neutrality. http://www.greeningtheblue.org/resources/staff-engagement

I am glad now that the UN can be seen as walking the walk and is offering a leading example in environmental and climate change communications and reporting.

The relationship between CSR and policy

2010-07-30T07:58:00.004+01:00

I’m not going to get into the specifics of South Africa’s mining policy environment, but I read Frans Cronje’s opinion piece in Business Day, “Engaging the State” with interest – and found a surprising take on CSR – not something I’d expected to come across within the topic.

Bank of America Merrill Lynch has produced a report that looks at some of the challenges facing the metals and mining industry in SA, and how the policy environment made it difficult to try and split Anglo American into international and South African assets to unlock value.

Without getting into the ins and outs of mining rights and politics, Cronje, deputy CEO of the South African Institute of Race Relations, is making the point that the government should not be afraid to enter into dialogue with the private sector in these circumstances. So not to ignore or challenge reports that critique the system, but to welcome the views of an engaged private sector, given the common goal of setting South Africa onto a path of further, better socio-economic development.

What made me sit up was Cronje’s point that “The government would be wise to see the report as a refreshing example of true corporate social responsibility — so different from the cliched vegetable gardens or soup kitchens that have come to pass as corporate social responsibility for many companies.”

I don’t think that most company CSR policies come down to soup kitchens and vegetable gardens, there’s incredible work being done on a large scale, but his point that a business’ engagement with government on hard issues could be seen as CSR is an interesting one. For all the definitions of CSR, self-regulation, giving back and creating a positive impact, managing the impact of a business on society, policy is rarely included.

Should corporate social responsibility directly address and take actions to support or work towards policies that also aim to create a positive impact on the economy, as well as the community?

In many large organisations the CSR departments don’t even sit in the same building as the policy people. There are, however, businesses that have aligned the work they do within community to highlight problems and try to force governments to recognise where policy needs to change. The danger is extrapolating Cronje’s point too far, when business feels it can criticise and pressurise governments in the name of ‘Corporate Social Responsibility’ without fulfilling the actual social impact part.

Where there is a connection between CSR intentions and policy requirements, there is more impact and an opportunity for aligning economic and social agendas – if governments listen, of course.

Africa needs more Mo Ibrahims.

2010-07-20T14:44:00.004+01:00

I was with Mo Ibrahim yesterday, in the plush offices of his foundation. What a great man. Self-effacing, generous and very committed to advancing better leadership in Africa. I first met him in 2004, before he had sold Celtel. He was a businessman then, with an interest to make money and to help tell the world, particularly institutional investors, about the business opportunities that Africa was yielding for his company and an industry which he had been working in all of his adult life – telecoms. With the attainment of huge wealth after the sale of Celtel to Zain, Mo has lost none of his gentle charm and none of his big ambition either. ‘If you are going to do this’, he said to me, then ‘do it big’, in reference to an assignment that africapractice is supporting the African Union with.

Mo has an armoury of facts and anecdotes at his fingertips, built up over many years doing business across Africa and courtesy too of the research that his foundation carries out and the circle of friends that Mo now keeps. Combine this with his passion, his conviction and the respect that we accord any successful businessman (not bankers!) who take a risk and make a fortune (building a GSM business in Africa in the early 1990s was perceived as a big risk believe it or not; only Development Finance Institutions could be persuaded to share the risk), then you have a serious, straight-talking and effective spokesman for Africa. Africa needs more Mo Ibrahims.

Marcus Courage

Africa Talks Climate

2010-07-19T10:32:00.002+01:00

A new initiative has been developed to help communicate and advocate on climate change issues in Africa. Africa Talks Climate is a research and communications project undertaken by the BBC World Service Trust and funded by the British Council. http://africatalksclimate.com/

Africa Talks Climate recently launched a report about the public understanding of climate change in 10 African countries with the aim of identifying ways to engage, inform and empower Africans in local, national and international conversations about climate change. The report found that most Africans understood that their climate was changing but the term ‘climate’ is rarely used outside South Africa and francophone DR Congo and Senegal. There is also a strong tendency for people to hold themselves individually or collectively responsible for these changes, which they blame on local environmental degradation.

The report recommends that information and communication needs of African citizens need to be at the heart of any national response to climate change. The ability of African citizens to respond effectively to climate change will be determined by the quality of the information available to them and how easily they can access it. Increased public understanding of climate change will enable citizens and communities to discuss the issue, adapt to the effects of climate change, and make informed long-term choices about their future.

Africa Talks Climate suggests that local leaders from government and the community, as well as religious leaders should have more access to climate change information and that there is a need to increase the public debate on climate change and create more public spaces for example through TV talk shows, radio call-ins and other interactive media platforms. There is also a need to break down perceptions of climate change as an elite discussion and build a sense of immediacy to encourage the sharing of current examples of adaptation and mitigation to climate change.

In the absence of an understanding of global climate change, many people draw on their existing knowledge and beliefs to explain the unpredictable weather. Some Africans understand changes in the weather in relation to their spiritual beliefs – particularly women and rural populations, hence the importance of activating local religious leaders. Some opinion leaders compare the communication challenges posed by climate change to those formerly presented by HIV and AIDS. They emphasise the importance of using accessible terminology and discussing climate change in a locally relevant way.

The report also stresses the important role media and education can play. Media, and in some countries, schools, are the main sources of climate change information for most people. Media therefore need to improve their knowledge, resources and experiences about climate change in order to inform audiences more effectively. Some journalists perceive climate change exclusively as an environmental issue, which is not an audience or an editorial priority.

Overall, the report assumes that to improve environmental stewardship, Africans need to be educated more about the causes and effects of climate change in order to adapt to the damaging impact it creates. However, a main driving force for behavioural change in Africa relates to improving household incomes and creating more financially secure futures. What therefore also needs to be communicated is the short and long term economic benefit that can be accrued through different adaptive techniques. All activities related to mitigation and adaptation to climate change in Africa need to have a strong element of economic benefit for the citizens in order for Africans to be incentivised to undertake the activity and for African countries to alleviate poverty levels on a sustainable course.

The report can be downloaded here: http://africatalksclimate.com/research/africa-talks-climate-public-understanding-climate-change-ten-countries

It's really over...

2010-07-12T11:06:00.002+01:00

Today is the first day of 2010 that's not about the FIFA World Cup build up or football matches. What are we going to do? As a nation, are we left bereft, with the anticipation of nothing more in our future? Are we able to pat ourselves on our backs for a job well done? When will we know if it has been a success? What makes it a success? How did we do folks, how did we do?

First things first, I think we need to look internally, to ourselves for that evaluation. It isn't about what the rest of the world thinks, it is about what South Africa thinks. And from where I am standing, we did pretty darn well. But I would say that wouldn't I? So let me take you through my thinking...

Infrastructure and Organisation:
We got it up, we got it running and we HAD A PLAN if the wheels fell off. And they didn't. Despite all the naysayers the stadiums worked (and if you were lucky enought to attend a match at Soccer City you would know just what I am talking about), the transport worked, and the lights stayed on! We made it happen.

Crowd Control:
During the event there was not even one match disrupted by crowd violence and I believe our peacekeeping authorities (by this I mean the good old SAP) did a sterling job. We have shown the world that we are not about the stereotypes - this is not only a beautiful country, it is also filled with warm, welcoming people and incomparable experiences for those who venture forth onto African soil.

Soul:
If you haven't heard the call of the vuvuzela by now, or at least heard about it, you obviously haven't watched a world cup match. I am proud to say South Africa really got behind this one. Even when Bafana Bafana was knocked out, we all chose new teams and kept on celebrating this fantastic carnival of football. Were we sad when Ghana was knocked out and we lost our last African hope? Of course, but we rallied again, and again..... it's in our soul as Africans to pick ourselves up, look for the best and keep on singing!

So, although it is really over, the legacy remains. This African World Cup has shown international audiences that we really can do it. It has shown Africans that we have what it takes. And it has shown South Africans that with a little goodwill and a lot of energy we can use an event like this to make a difference for everyone. Thank you FIFA for choosing us to host your 2010 event, we did you (and ourselves) proud.

Award winning journalism

2010-07-07T13:52:00.004+01:00

I was in London last Thursday for the Diageo Africa Business Reporting Awards. It was a hot week in the city, and for some journalists who came over for the ceremony, the first time they had been to London.

It was great to put faces to names, and to have the opportunity to meet some of the leading journalists from around the world. Each had something insightful to say about the role of the media in Africa, their personal position, country, career.

Kerry Dimmer, winner of Best Infrastructure feature with ‘The Scramble for Blue Gold’ in African Decisions, South Africa, made a great speech commenting that these awards really help promote the journalists who win them. Uganda's Francis Kagolo from New Vision said the same of his award (Agribusiness / Environment feature) that it puts him in the field of greater journalists in Africa, all of whom should be working to put forward the best reporting.

When ‘Spark Africa Series’ by Peter Vlam and his team at Africa Interactive won Best Use of New Media in a Story, I didn’t quite realise the extent to how widely they work; 800 freelancers, mostly on the continent, so as well as creating content this is an exercise in capacity building and empowering local media.

Felix Dela Klutse of the Daily Guide Newspaper, Ghana, who won best business news story with ‘China Takes African Market by Storm’, got a great reception. Perhaps some fellow countrymen in the audience, or a general affinity with Ghana given their success in the World Cup (who were knocked out the next night, much to my dismay).

I was also privileged to meet with Oby Ezekwesili, the Vice President of the World Bank for the Africa region. Having been in conference calls and board meetings all afternoon, she arrived fresh and smiling, happy to have her photo taken with the finalists, after speaking about the economic opportunities on the continent.

Stephen O’Brien Permanent Under Secretary of State for International Development, who was born in Tanzania, talked about the role that government and business has to play, and the importance that the perception created by the media plays in investment decisions. He made the point that when sat round the boardroom table, looking where to put your money, you have about 3 minutes per country. Not long for in-depth analysis, therefore key indicators and headline reports are crucial.

Good to see some of the journalists represented at the awards last week already making that headline difference.

Lagos: Megacity or Crisis City?

2010-06-22T11:02:00.003+01:00

“Lagos is a state of mind” - a message fervently echoed by Friday’s panel at the School of Oriental and African studies in London. An evening discussion with Jaasper Moelker of Urban Detectives, Simon Gusah, a Planning Consultant in Nigeria and Kunle Adeyemi for the Office of Metropolitan Architecture stirred a lively response from the auditorium composed predominantly of well informed Nigerians with a personal concern for the future of Nigeria’s nerve centre – Lagos.

The explosive growth of Lagos – by 2020, it will be the third largest city in the world, with 24 million inhabitants – has brought near-paralysis to the city’s ring of highways. Lagos’s infrastructure is being pushed to its limit, resulting in severe traffic congestion. This contrasted with the city’s impressive estimated 3.6 trillion Naira (£16 billion) annual turnover begs the question, Megacity or crisis city?

Although chaos filters through all parts of Lagos life, it is arguably stable and organised chaos. Where there is a place, people will occupy it, reflected in the bustling marketplace and booming informal economy. Gusah, an advocate for this standpoint, was clear in his thoughts: there is no problem in Lagos. The government and the private sector create the problem they believe they are trying to solve. They have not learned what makes Lagos tick and it certainly does tick. The crisis lies within the structure of government; their inability to carry out infrastructure programmes and policies that last beyond two years is shutting down development. Improvement takes five, ten, maybe twenty years which requires relentless commitment. At present their priority is to award new contracts when it should be to concentrate on the current.

Adeyemi’s fascinating presentation introduced what the Office of Metropolitan Architecture envisages as the saving operation, the 4th mainland bridge. The 1.5km long bridge will be the missing link completing a transport ring around the city, connecting Ikorudu with the community of Aja/Lekki, and facilitating the rapid expansion of the eastern corridor of the city. While vehicle traffic flows on the bridge’s upper deck (which includes lanes for BRT buses), the lower deck facilitates the inevitable hustle and bustle of Lagos in a more conducive environment. Markets, kiosks, shops, bars, and restaurants will generate a new area of pedestrian convergence, fostering economic growth, social life, culture and interaction. An image included in Adeyemi’s presentation featured a Prada store alongside the fruit ladies on the lower deck – an interesting vision!

So, it seems that this potential megacity could be just that – the work of Fashola, Governor of Lagos State, was considered by the panel as positive progress. Gusah commented, "In Africa, you are praised for doing your job and Fashola seems to be doing his...I am as happy with his work as I am with the work of my local council. Fundamentally there is nothing outstanding about this but we must think of it relative to other African leaders and politicians.”

Lagos is not a city in crisis, but its rapid growth poses serious questions that need intelligent answers and responsive, responsible and flexible governing. This is the problem with great opportunities and Lagos undoubtedly presents a great opportunity.

"Un-caging the lions'' - How Business is transforming Africa for the better.

2010-06-15T14:20:00.002+01:00

Article published in the Economist magazine June 10th.

For once an investment fad seems justified: the 21st century is shaping up to be that of the emerging markets, just as the 20th was America’s century and the 19th Britain’s. But that leaves open the question of which countries, exactly, will emerge. Will Asia and Latin America mark the limits of the spreading prosperity? Or will the boom reach the perennial laggard, Africa? Will a new pride of economic lions take their place beside the Chinese dragon and the Indian tiger?

Ten years ago The Economist dubbed Africa “the hopeless continent”. Since then its progress has been remarkably hopeful. In 2000-08 Africa’s annual output grew by 4.9% (adjusted for purchasing-power parity), twice as fast as in the 1980s and 1990s and faster than the global average of 3.8%. Foreign direct investment increased from $10 billion to $88 billion—more than India ($42 billion) and, even more remarkably, catching up with China ($108 billion). The Boston Consulting Group notes that, since 1998, the revenues of Africa’s 500 largest companies (excluding banks) have grown at an average of 8.3% a year.

But is this growth sustainable? Or is the current fad for Africa just another bubble? The pessimists have always had three strong arguments. One is that African politics is dysfunctional. Warring strongmen can undo the progress of decades in weeks. A second is that the African economy is unduly dependent on the resource sector. A third is that Africa’s growth does too little to benefit the poor. But over the past decade, all these objections have weakened.

Football Fever hits SA

2010-06-09T09:08:00.002+01:00

With just 2 days until the opening ceremony, the excitement is literally a tangible phenomenon. Everywhere you turn there are flags, Makarapa hats (fashioned out of builders safety helmets) and of course, the vuvuzela.

Now, I feel that I have to take a moment - or more - to discuss the vuvuzela because, love it or hate it, it has become a South African icon, part of popular culture and for this FIFA World Cup 2010 at least, a symbol of the indomitable African spirit. Sitting in the stands last night watching Mozambique vs Portugal, this was very much in evidence. The call of the vuvuzela resonating around the stand was both a challenge and a celebration, a distraction and an encouragement....a paradox that I am sure is going cause much media furore over the coming weeks. With so many vuvuzelas being blown at once, it begged the question of what the collective noun might be. My pounding head (despite earplugs) suggested a ‘violation of vuvuzelas’ but my heart knows that it is really a ‘victory’.

A victory of vuvuzelas for a continent finally given the chance to show the international community that it can host a world-class FIFA tournament, a victory of vuvuzelas for a continent pulling together for the first time in a year of peace and security and finally, a victory of vuvuzelas for Africans everywhere as the world wakes up to our potential in sport, culture and as a growing economic force.

So bring on FIFA World Cup 2010! Africa is ready, her arms are open in welcome....come and join the fun.

Why CSR in Africa can be a unique force for good

2010-06-07T17:15:00.003+01:00

In the poorest slum district of Addis Ababa, Ethiopia, some 50,000 people receive fresh drinking water and sanitation facilities through a project run by an NGO called AMREF. I was lucky enough to visit this community in Kechene and talk directly with the beneficiaries to understand the impact of this project, a corporate social responsibility (CSR) project funded by the Diageo Foundation, a premium drinks company.

What my colleague and I unearthed was a project well planned, thoroughly implemented and carried out by passionate people who genuinely wanted to improve the standard of living for those living in Kechene. Although we catalogued numerous benefits, the real impact on the community was evident to me when I met Meselu Abreham. Meselu is a local resident in charge of one of the water and sanitation committees who look after the new facilities. Before I could thank her for telling us about her new role, she ushered us into her one-roomed house and headed directly for the only ornament in the room, an earthen vase made by her cousin. She was adamant that we take it and keep it as a gift from the people of Kechene, as a thank you for changing their lives through the project. After some persuading, we were obliged to accept her kind offer which now resides within my own house as a symbol and reminder of the powerful force good CSR can be in Africa.

CSR in Africa is different from CSR in Europe or America. It has different driving forces. The strength of regulation in Europe and America encourages improved environmental performance and ethical business practices. Institutional investors and shareholders play less of a role in how the companies they invest in behave. The level of environmental and social awareness from consumers and employees is not at the same intensity and expectations about how businesses should operate are different. Interestingly in Africa, because companies are so embedded in the fabric of society, businesses are expected-and eager- to play more of a role in developing the communities in which they operate.

Consequently, there is a large difference in the potential for impact of CSR in Africa compared to more developed countries. Because of these differences, there has been an encouraging debate about what exactly is CSR in Africa? Is it just window dressing to improve corporate reputation or does it really add value to the company’s financial bottom line and the community at large?

It was this debate that I frequently found myself in during conversations whilst travelling across the continent . This is what sparked the idea of the East African CSR Awards. It was clear that many companies were investing in community development programmes and improving their operations to reduce environmental impacts and increase employee health and safety. The awards therefore aim to showcase initiatives which have truly benefitted the society, environment and businesses in order to clarify what good CSR in Africa looks like.

A recent seminar in Monrovia, Liberia this year hosted by the Brenthurst Foundation looked at developing guidelines for CSR in Africa. This demonstrates that there is a need for clarity. An initiative like the East African CSR Awards can help develop an understanding of how the private sector can create sustainable development and alleviate poverty in Africa.

On the judging call to decide the winners and highly commended projects for the Awards, some common themes began to appear:

· A commitment to investing in time and resources to assess what the project should be, what benefit it would bring to the business and community / employees and how it should be implemented. This commitment creates innovative and context-relevant projects such as Unilever Tea Tanzania and Kenya’s ‘Lightning Detection Programme’.

· An integration of business incentives with environmental and social good, as illustrated by Sandali Woods and their strong ethos for sustainability.

· Comprehensive monitoring and evaluation systems to record not just outputs but actual development impact. Eastern Produce Kenya’s Environmental Programme and Mabati Rolling Mills’ project clearly demonstrated that ‘what gets measured gets managed’.

· Community-driven activities in order to foster community ownership and sustainability as Tullow Uganda’s project demonstrated.

· Strong partnerships with credible NGOs and local authorities to ensure an element of sustainability and alignment with government policies, as was characterised by Safaricom’s ‘A World of Difference’ secondment programme and Unilever Tea Tanzania’s Forest Conservation programme.

· A multi-faceted approach to the project, ensuring different elements such as awareness raising and management mechanisms were put in place, as demonstrated by Nile Breweries Supply Chain project.

Over the course of the year, the Awards secretariat hopes to work with its partners and judges to develop these guidelines and criteria with the hope of stimulating more successful CSR projects in East Africa and assisting the government in creating an enabling operating environment for businesses to implement excellent CSR. Ultimately, with everyone playing their part, the private sector can drive an inclusive model of economic growth for Africa, providing equitity and sustainability.

I would like to thank all those involved in making the first East African CSR Awards a success – the Honourable Tanzanian Minister of Trade, Industry and Marketing, the sponsors – Bank M Tanzania and Dow Chemical East Africa, the partners – the East African Business Council and the East African Magazine (Nation Media Group), the distinguished panel of judges and the chairman of the Awards secretariat, Mr Elvis Musiba, and last but not least, all the companies who entered.

Happy Africa Day!

2010-05-25T15:17:00.007+01:00

Today is Africa Day! Africa Day is an annual commemoration (25 May) of the founding of the African Union. On 25th May in 1963, 30 leaders of independent African states signed the charter to establish the Organisation of the African Unity, the name of the African Union at the time.

Africa Day is celebrated each year across the continent in the spirit of Pan-African integration and solidarity. As well an occasion for celebration, it represents an opportunity for African states to refocus on their commitments towards continental cooperation on political, economic and security issues. In 2010, the Year of Peace and Security in Africa, their focus will be on continental collaboration in conflict prevention and peace building.

To ensure the sustainable economic development of the continent, it is vital that Africa brings an end to the remaining conflicts that continue to destroy the livelihoods of so many Africans. With this objective in mind the African Union and Africa’s Heads of State and Government took the decision to declare 2010 the Year of Peace and Security in Africa in their Tripoli Declaration of August 2009. The declaration communicated a collective determination to push forward the agenda of conflict resolution and peacemaking in order to leave a peaceful and prosperous legacy for future generations of Africans, and as such, the African Union is pursuing a number of public campaigns and events this year with the help of a range of African and international partners, under the banner of ‘Make Peace Happen’, in an effort to mobilise peace building efforts on the continent.

Mr. Erastus Mwencha, Deputy Chairperson of the AU Commission spoke at the handing over of the 'Flame of Peace' ceremony during Africa Day celebrations and 100th Anniversary of Dr. Kwame Nkrumah. He took the opportunity to link Africa Day to the objectives of the 2010 Year of Peace and Security in Africa and to promote the AU’s Make Peace Happen campaign and the International Day of Peace which takes place on 21st September 2010:

“This Year, while Africa makes history staging the FIFA World Cup, Africa will be making another kind of history too. In recognition of all our efforts in peace making and conflict resolution, on 21 September, Africa will come together on Peace Day, to promote non-violence and humanitarian assistance across Africa. This moment of collective unity will bring together 1 billion people to work together to demonstrate that peace is possible in Africa.”

“Dare to shape the future?”

2010-04-22T14:00:00.007+01:00

Marit Flinder Johannessen, africapractice London

Ahead of the 30th anniversary of Zimbabwean Independence on 18th of April, the Royal African Society, in collaboration with ACTSA arranged a debate called “What next for Zimbabwe?”

The panel of discussion, as seen from the left:

Gabriel Shumba - Executive Director, Zimbabwe Exiles Forum, South Africa

John Mawbey - South African Municipal Workers Union

Richard Dowden - Director, Royal African Society and Chairman of the debate

Lovemore Matombo - President, Zimbabwe Congress of Trade Unions

Margaret Ling - Treasurer, Britain Zimbabwe Society and Trustee, Zimbabwe Association

The participants all emphasised the critical situation of Zimbabwe in 2010, but also the need to think positively about the future steps the country needs to take. The main discussions revolved around the role of the Zimbabwe diaspora, sanctions and upcoming Constitutional elections of 2011.

The whole panel seemed to agree that the diaspora, currently around 4 million people, in South Africa, United Kingdom and other places must continue to be engaged and involved in the land tenure situation. This is not just to influence and contribute to a possible change in Zimbabwe, but so that their ties to the country stay strong.

Sanctions have been a hot potato when it comes to trying to influence Zimbabwean politics. Mrs. Margaret Ling pointed out that some of the problems with sanctions were that countries like the UK have failed to explain how the sanctions actually work. Additionally, President Mugabe uses the current sanctions as a scapegoat for the country’s financial crisis. Mr. Lovemore Matombo followed by making a reference to how the sanctions worked in the period of Ian Smith’s Rhodesia. Whilst international sanctions were applied to Rhodesia, the government at the time applied import subsidies making Rhodesia one of the wealthiest countries in Africa in the 1970s. Mr. Matombo clearly stated that sanctions are not what are making the economic crisis of Zimbabwe today, it is the governmental policies that are making the Zimbabwean people suffer.

Mr. Gabriel Shumba commented,“You can only spread good news if there is good news to spread”

On the question of an election next year there was some disagreement between the audience and the panel. The lack of institutional change in the last two years within the transitional government was one of the main arguments why an election next year was highly premature. But Mr. Gabriel Shumba said he would rather prefer elections next year, with mechanisms to ensure free and fair elections than having the MDC and Zanu FP going down a long road of partnership.

afrique: Une superpuissance en devenir

2010-03-22T15:49:00.008Z

Taken from African Business Magazine. March-April edition.

Analysis by Bamanga Tukur, Chairman of africapractice group

Pouvez-vous imaginer qu’un jour l’Afrique jouira d’une telle influence que le reste de la communauté internationale devra se ranger à ses opinions sur les questions internationales ? Imaginez-vous qu’un jour l’Afrique soit une superpuissance ? Ce jour pourrait arriver plus tôt que vous ne le pensiez.

Lors de la conférence sur le changement climatique à Copenhague, l’Afrique a prouvé qu’elle savait se montrer unie. Malgré les différences entre les États, les 53 nations ont affiché un front uni, dans une large mesure grâce à la direction de Meles Zenawi ; et la communauté internationale a dû écouter et s’incliner. La conférence de Copenhague pourrait-elle marquer l’avènement d’une superpuissance

internationale ? Plusieurs faits le laissent penser :

L’Afrique représente potentiellement le plus grand nombre de voix aux Nations unies - 53 voix. Si les gouvernements africains continuent à adopter une position commune comme à Copenhague, ils pèseront dans les décisions.
L’Afrique possède la plupart des ressources naturelles mondiales, aujourd’hui en déclin. Elle bénéficie aussi d’un avantage dans le domaine des nouvelles sources d’énergie propres.
L’Afrique compte près d’un milliard de personnes - le plus vaste marché de consommateurs hormis la Chine et l’Inde.
La croissance économique est aujourd’hui plus forte en Afrique que dans n’importe quelle autre région du monde.
L’Afrique disposera bientôt de sa propre force militaire de réserve qui pourrait contribuer de manière significative à la lutte contre le terrorisme.

Énergie et ressources

L’Afrique recèle d’immenses ressources : plus de la moitié des réserves mondiales de cobalt, de manganèse, de café, de cacao, d’huile de palme et d’or. Elle a du platine et de l’uranium en abondance, et possède près de 20 % du pétrole vendu sur le marché mondial. Chaque mois, n découvre de nouveaux gisements de pétrole et de gaz sur le continent. D’ici deux ans, l’Ouganda à l’Est et le Ghana à l’Ouest rejoindront le club des plus gros producteurs de pétrole. Dans le domaine des énergies propres, l’Afrique possède un atout : de nombreuses régions du continent sont propices au développement de projets d’énergie solaire. Le jour où les centrales solaires d’Afrique du Nord seront reliées à l’Europe et alimenteront des usines à Barcelone, à Bari et à Bruxelles, est peut-être tout proche. D’autre part, le continent détient 40 % du potentiel d’énergie hydroélectrique mondial, en tenant compte du barrage Grand Inga qui, une fois achevé, produira quelque 39 000 MW, ce qui en fait le plus important projet hydroélectrique dans le monde. L’Afrique est également bien lotie en énergie géothermique. À eux seuls, les pays de la vallée du Rift pourraient générer environ 7 000 MW, selon les estimations du Programme des Nations unies pour l’environnement. Le Kenya prévoit de produire 1 000 MW d’énergie géothermique d’ici à 2018.

Stabilité et croissance

Au cours de ces dix dernières années, l’Afrique a enregistré en moyenne un taux de croissance supérieur à 5 %. Parallèlement, elle a connu une période de stabilité politique sans précédent. Il y a bien eu

des heurts, notamment au Kenya, à Madagascar, en Mauritanie, au Soudan, en Guinée et au Zimbabwe, mais l’Union africaine est parvenue à résorber la plupart de ces crises, et la stabilité est revenue ou en voie de l’être. Comme l’explique Vijay Mahajan, spécialiste du marketing et consultant pour des multinationales, la classe moyenne africaine représente à peu près 300 millions de personnes qui sont aussi des consommateurs. On peut établir un parallèle avec ce qui s’est produit en Inde il y a quinze ans, quand l’urbanisation rapide et les investissements massifs dans les services et les infrastructures ont transformé le pays. Bientôt, plus de 70 villes africaines compteront une population de plus d’un million d’habitants. Aujourd’hui, le PNB par habitant est déjà plus élevé en Afrique qu’en Inde, et un quart des nations africaines a un PNB par habitant supérieur à celui de la Chine. Alors que les économies européenne et américaine stagnent, l’introduction de nouvelles technologies en Afrique, en particulier les TIC, permettra au continent de progresser à pas de géant. Aucun doute qu’il se développera davantage dans les dix ans à venir qu’au cours des 50 dernières années.

Superpuissance : les clés d’un statut

Devenir une superpuissance demande beaucoup d’efforts. Mais surtout, pour accéder à ce statut, un pays doit se convaincre qu’il est une superpuissance. Il doit adopter une attitude radicalement différente. Moins de dépendance, davantage de vision. Ces dix dernières années, à part quelques exceptions notables (Obasanjo, Bouteflika, Wade, Mogae et Mbeki peut-être, ainsi que quelques membres de la commission de l’Union africaine), l’Afrique a cruellement souffert de l’absence de dirigeants charismatiques et d’un manque de vision parmi les élites politiques. Un système d’éducation de qualité et le retour de milliers d’Africains dans leur pays devraient tout changer. Lagos, Luanda et d’autres centres d’activité du continent accueillent déjà les Africains de la diaspora qui reviennent en masse. Ceux-ci ont été formés dans les meilleures universités du monde. À présent, ils rentrent chez eux pour exercer leur métier. Ils emportent avec eux des capitaux, du savoir-faire et de nouvelles technologies. On assiste à ce que j’ai appelé la « Raspora ». La vente de Celtel qui a rapporté des millions il y a cinq ans à Mo Ibrahim, le chef d’entreprise soudanais vivant au Royaume-Uni, a attisé leur appétit. Depuis, « l’effondrement » des États-Unis et de l’Europe a rendu le retour au pays encore plus tentant.

L’Afrique a besoin aujourd’hui de bons dirigeants. Une génération animée de convictions profondes, comme le nouveau président du Gabon, permettra à l’Afrique d’accéder au statut de superpuissance. Pour cela, ces nouveaux dirigeants doivent mettre fin au clientélisme et se tourner résolument vers leur nation, leur région et vers le monde.

A common agenda for an uncommon people

2010-03-18T12:35:00.001Z

I attended the East African Community’s rail conference in Dar es Salaam last week. As EAC integration makes its slow steady progress (much like the railways) there is increasing talk of the significance of this regional merger. A single market! A larger customer base! Greater movement of people and goods! A stronger political force in international fora! A single currency! (The Greeks may cringe at the last one)…

As I milled about with representatives from the five nations (Kenya, Uganda, Tanzania, Burundi and Rwanda) as well as co-sponsor delegates from the World Bank, it occurred to me that whilst it’s wonderful to see African neighbours attempt to collaborate for mutual benefits - I am of Eritrean origin so a particularly poignant sight for me- there is a risk that this political and economic marriage may exaggerate similarities between these very distinct parties in the minds of others. For ‘others’, read ‘The West’ and, as no serious conversation regarding Africa can now take place without reference to China, also ‘The East’.

Too often in the past and in the present, Africa has been presented as a homogenous place plagued by famine, corruption, war but blessed with exotic people and wildlife. Once a rather handsome West Indian asked me if I spoke ‘African’… I was far too enamoured to be rude but let him know that there were nine languages (NB not dialects) spoken in my tiny country of four million people and I only spoke one of them – and not as well as I’d like either.

Now – for those investors whose interests are piqued (as they should be) by the potential of the EAC and the promising GDP growth rates that have remained largely resistant to the credit crunch, please note: diversity is the one consistent feature in Africa.

This has been firmly brought to light in my time here in Dar es Salaam following my time working in Kenya and a very brief jaunt in Uganda. The people, the politics, the language, the attitudes are as far apart as the breath taking wide landscape allows. Call a Canadian an American, and I guarantee they won’t jump on you half as fast as a Tanzanian would if you had the audacity to bracket them with Kenyans. Tanzanians are not only a different kettle of fish, the distinctions within the nation are also significant. In fact, these virtual and cultural intra-national boundaries are as strong if not stronger than those between North and South Londoners (South rules!) or Brooklyn and Manhattan or ‘insert example of your own’.

So what to do?

Don’t assume: respect these important, ingrained distinctions; use on the ground intelligence; leverage local relationships and speak to those in the know – preferably face to face. An improved physical infrastructure will facilitate greater mixing but East Africa will never be a uniform mass despite its uniformly poor rail service.

What do you want to be famous for?

2010-03-12T06:08:00.004Z

What do you want to be famous for?

And we’re not talking just 15 minutes. India has become the destination for software development, as well as a number of major outsourced processes from accounting to call centres. As new markets emerge to offer services at cut prices, whole new industries spring up around the world, boosting economies and cutting costs, and corners, for big industry. Markets like Costa Rica, the Philippines and Ireland compete in the call centre industry as well, for example, but Africa has now started to look at what it can sell on the global BPO marketplace.

As The East African writes this week: For many developing countries, outsourcing is the ultimate get-rich-quick scheme. The author writes about “the lure of the half-trillion-dollar market”, which has seen 65% growth from 2005 to 2009, 85 per cent of which is unaddressed, being irresistible.

But none of this is inevitable. It takes strategic investment from public and private sector to build the infrastructure, the talent, the demand for a particular service. While Kenya wants to become the top BPO destination in Africa as part of its Vision 2030, there’s a lot of ground work to be done – locally and internationally.

Could African countries succeed in positioning themselves as an outsourcing destinations, as a way to boost the economy, create jobs, to develop new industries? Some of the raw ingredients are there: a young labour force that can be trained in new skills, for example. More importantly, labour is cheap while the cost of property and development and source materials is lower than in much of the world.

Take the film industry. We’ve already seen Mexico, Canada and Eastern Europe become choice destinations for films ‘located’ in the United States, as they offer cheaper locations. Already numerous advertisements that seem to take place in Rome or Paris are shot in Cape Town.

But it’s not as simple as a price tag. Whether it’s a call centre or a cinema lot, to build an entire industry involves infrastructure, technology, people, training, facilities, tax breaks and an economic landscape that encourages start-ups and new entrants, rather than kills any competition.

The GIBS’ review this week touched upon it, with a review of an article from Knowledge@Wharton about Chinese development, and a comparison with India.

“A crucial aspect of the Chinese version of the developmental state has been the creation of physical infrastructure like roads, airports, electricity, internet, etc., writes WMG Media. India, in contrast, has neglected the state provision of physical infrastructure in favour of ‘soft infrastructure’ – building human capital, especially the use of the English language, to make the country a resource of service professionals for businesses all around the world.”

So there are different routes to be taken to establish a centre of excellence and a capacity to solve and service a global need, but it definitely doesn’t come to those who wait. It takes private and public collaboration and conscious planning. As countries like Rwanda and Kenya invest in ICT and skills they may not immediately compete with the likes of India and China, but they’ll sure compete favourably with the rest of the continent.

Private Sector Development in Africa – Perceptions and Realities

2010-03-11T09:04:00.001Z

Can the private sector really be a driver creating opportunities for people to escape poverty and improve their lives? In theory, private sector development should be the ultimate driver of socio-economic development through job creation and its contribution to economic growth. In practice, several factors such as perceptions of Africa, insufficient policy frameworks and dependence on international aid have resulted in limited private sector impact to date.

After working in Africa for a while, one easily forgets that many outsiders still have a very “Live Aid” image of Africa. They do not know it as a region with one of the highest growth rates and a rising, well-educated middle class, but rather think of it as a place of war, famine and corruption. This persistent perception, despite recent progress and achievement, also disempowers Africans, engendering a sense of ‘passive victim’ rather than ‘accomplished entrepreneur’.

Investors who take the time to understand the continent and its opportunities tend to be well rewarded. The British firm Tullow is probably one of the most striking examples. Not too long ago, it was still a smallish outlet but its investment and belief in the African continent has already triggered the fundamental transformation of two economies and thereby the success of its own operations. The investment Tullow made in oil exploration in Ghana and Uganda has led to significant discoveries that have spelt a new and lucrative future for both countries.

Apart from the abundant natural resources found in most of her countries, Africa is also touted as the potential food basket of the world. Agriculture accounts for more than 50% of GDP and up to 90% of employment across much of the continent, but productivity remains low. And while there has been much talk about transforming the sector, the reliance on subsistence and small-holder farming has proven more than a stumbling block to developing diversified economies with higher levels of income, than an opportunity in itself.

For private sector development to work, African countries and its development partners need to create policies for commercially viable markets while promoting their country’s image and competitive advantage. An example of this is Kenya; after the arrival of a new high-speed internet cable, recognized the opportunity for Business Process Outsourcing (BPO) through the pairing of enhanced connectivity and its relatively large base of well-educated workers.

Ultimately, the promotion of value-add industries and the development of the required policy frameworks and infrastructure will allow the private sector in Africa to make significant progress in its development and contribution to job creation and poverty alleviation. The classic example of trying to sell chocolate as a finished product instead of selling cocoa as a raw material has lost none of its appeal.

Zuma in the UK

2010-03-10T09:38:00.001Z

By Hamish Stewart and Marco Picardi, africapractice London

The arrival last week of Buckingham Palace’s first candidly polygamist guest under Queen Elizabeth II’s reign has been uncharacteristically subdued. But, whilst the South African premier, Jacob Zuma, will be crossing his fingers for as mellifluous a sojourn as possible, his visit should be seen as an opportunity for Britain to reassert itself as a protagonist in Africa in the face of rapidly growing competition from the BRIC countries.

Britain has much work to do on the continent if it hopes to retain its historical importance in the region and to match the surging investment and growing influence of the BRIC nations. Amongst this grouping, it is China that has made the most waves in its permeation of the continent. Although China is certainly not a new arrival in Africa, trading sums of up to $100 million per annum with some states during the height of the Cold War, recent rapid growth in the volume of economic transactions with Africa has been striking; within ten years of establishing economic and diplomatic ties with South Africa, it is now the rainbow nation’s largest trading partner. In fact, Chinese engagement in continent has seen it claim the title of Africa’s biggest trade partner, a relationship currently worth around $100 billion and growing.

Not to be left out, Russia, India and Brazil have also joined in the post-colonial struggle for new business opportunities on the continent. By mid 2008, Russia had become the second largest foreign investor in Africa. While this situation has changed following the financial crisis, it is a strong indication of what lies ahead. Large, formerly state-owned firms such as Rosneft, Lukoil and Gazprom continue to pursue new opportunities in the oil and gas sectors in diverse countries from Nigeria to Angola.

Along with other emerging economies Russian, and more significantly, Chinese private sector and government investment in the continent is changing the politics of aid and trade in Africa. The British are limited in their capacity to match the munificent repayment terms and low interest rates often afforded in Chinese financing of infrastructure development. Innovative schemes adopted to bolster Sino-African business, such as the creation of special cooperative economic zones, first seen in Zambia in 2007, where Chinese enterprises get tax breaks in exchange for attracting investment into the local economy, present a challenge to Britain’s traditional relationship with the continent. The most recent of these projects, a proposed Suez Economic Zone agreement between the Egyptian government and a Chinese firm from Tianjin, highlights the increasing reach of emerging economies in strategic economic sectors.

Britain must no longer rely so heavily upon historical political ties in seeking to influence the path to development of key countries, but rather must be prepared to engage in constructive long-term investment that will demonstrate commitment to a prosperous future for Africa. In light of Chinese, Russian and more recent Indian trade overtures to African leaders, Britain must be more aware that what she offers is a choice among a growing list of developmental partners in Africa. As domestic economic tides ebb and flow it will be increasingly important for Britain to build constructive economic and political relations with Africa. Here’s hoping Zuma and the Queen will get things started…

Is REDD the new green?

2010-02-18T09:40:00.004Z

Deforestation contributes an estimated 17% to global greenhouse gas emissions and reduced emissions from deforestation and degradation (REDD) is one of the most effective ways of addressing climate change. Further, avoiding dangerous climate change would be very hard to achieve without addressing deforestation.

Despite its cost-effectiveness, significant funding will be required to address deforestation due to the scale and complexity of the problem. The Union of Concerned Scientist estimates that “for $5 billion a year, REDD can protect nearly 20% of the tropical forests in danger of deforestation, and $20 billion a year can protect about half. With funding approaching $50 billion a year, tropical deforestation could be reduced by two-thirds.” In comparison, the UK’s Eliasch Review estimates between $17-33 billion would be required annually in order to halve emissions from deforestation by 2030.

The outcomes of the climate summit in Copenhagen included a Green Climate Fund over $10 billion annually between 2010-12, only a portion of which will be allocated to REDD activities. While the current funds available are certainly not sufficient or adequate, the promise of increased funding in the future can be used to further evaluate the existing carbon stock in tropical forests, develop demonstration projects and establish the necessary institutional structures.

For Africa, there are immense opportunities to attract climate finance to the Congo Basin Forest which is the world’s second biggest tropical forest after the Amazon. It contains about one quarter of the world’s tropical forest, a wealth of biodiversity with about 10,000 plant species and 70% of Africa’s plant cover. Its vegetation alone contains about 25-30 billion tonnes of carbon – the equivalent of about four years of current global anthropogenic CO2 emissions.

However, the region and its six countries (Cameroon, the Central African Republic, Congo-Brazzaville, DR Congo, Equatorial Guinea and Gabon) face significant challenges in establishing the mechanism to effectively manage any funds based on relatively weak institutions in most countries. While several efforts such as the Congo Forest Basin Partnership and the World Bank’s Forest Carbon Partnership Facility are only two of numerous activities, it will be crucial for the countries in the Basin to develop their own demonstration projects and fund structures that will show effective implementation, adequate monitoring of carbon stocks and flawless financial administration.

In order to increase credibility and African ownership of current and future forest funding, such pilot programs should be a mix of government and market-based approaches for both the funding and the administration of the funds and projects. The Copenhagen Accord already called for a mix public and private sources of funding but it will be important to also develop the right mix of institutions to allow innovative and effective mechanism to address the great challenges and opportunities REDD provides for Africa.

Climate finance after Copenhagen

2010-02-05T16:40:00.006Z

Calculating the real cost of climate is a highly complex and contentious affair. It is undeniable that we need to fundamentally transform our economies to get on the path of low-carbon growth, especially by reducing energy consumption and reliance on fossil fuel and halt deforestation as one of the biggest single contributors to climate change. We also need to adapt our way of life to the unavoidable effects of climate change such as changing rainfall patterns, extreme weather events and rising sea levels. While it remains difficult to calculate the costs of the required action on such a massive scale, there is a clear urgency to make substantial funds available as soon as possible.

A variety of climate funds have already been established, most of which have a very specific purpose and relatively limited funding from donor countries. A proposal for a new approach in raising up to $100 billion a year for “Green Fund” for the transition to a low-carbon economy by the World Future Council has been taken up by the IMF. The principal idea is to raise finance through the issuance of additional Special Drawing Rights (SDRs), a reserve asset created by the IMF. The creation of “new money” by issuing new SDRs should not cause inflation if the funds are productively invested into renewable energy.

Africa has long been demanding significantly increased climate funding as the continent most affected by and least responsible for climate change. The official Proposal by the African Group in Copenhagen demanded the establishment of a new adaptation fund to finance the full costs of adaptation activities and the related transfer of technology sharing and capacity building in developing countries, with sources of funding be new, substantial and sustained public funding from developed countries, with an annual scale not less than 2.5 % of the GNP of developed countries. The hopes for such significant funding were shattered together with many other aspirations for the Copenhagen conference but at least some commitment was made in the Copenhagen Accord with regard to climate finance:

“Scaled up, new and additional, predictable and adequate funding as well as improved access shall be provided to developing countries, in accordance with the relevant provisions of the Convention, to enable and support enhanced action on mitigation, including substantial finance to reduce emissions from deforestation and forest degradation (REDD-plus), adaptation, technology development and transfer and capacity-building, for enhanced implementation of the Convention. The collective commitment by developed countries is to provide new and additional resources, including forestry and investments through international institutions, approaching USD 30 billion for the period 2010-2012 with balanced allocation between adaptation and mitigation. Funding for adaptation will be prioritized for the most vulnerable developing countries, such as the least developed countries, small island developing States and Africa. In the context of meaningful mitigation actions and transparency on implementation, developed countries commit to a goal of mobilizing jointly USD 100 billion dollars a year by 2020 to address the needs of developing countries. This funding will come from a wide variety of sources, public and private, bilateral and multilateral, including alternative sources of finance. New multilateral funding for adaptation will be delivered through effective and efficient fund arrangements, with a governance structure providing for equal representation of developed and developing countries. A significant portion of such funding should flow through the Copenhagen Green Climate Fund.

To this end, a High Level Panel will be established under the guidance of and accountable to the Conference of the Parties to study the contribution of the potential sources of revenue, including alternative sources of finance, towards meeting this goal.”

While the Ethiopian Prime Minister Meles Zenawi was criticised by many for his willingness to compromise and settle for less adaptation funding than requested, the fact that there now is such as fund can partly be attributed the to Joint appeal of France and Ethiopia from 15 December. Meles is now a member of the high-level panel for the Green Climate Fund which has a formidable task ahead in addressing the following key issues:

1. Out of the USD 10 billion committed, how much is new and additional money, i.e., not a diversion of Official Development Assistance (ODA) or previously committed funding to deforestation by countries such as Norway or low-carbon growth by countries such as the UK? And if it is not “new money”, how should additional commitments be measure without penalising countries for their commitments earlier on?

2. What will be the mix of public and private, bilateral and multilateral, including alternative sources of finance for the fund and will the funds be dispersed as grants or loans?

3. Which financial institution will allow fulfilling the long-standing demand by developing countries to have balanced representation in the administration of the fund in addition to figures such as Meles already taking prominent positions?

4. What will the money be spent on? Just deforestation and forest degradation, adaptation, technology development and transfer and capacity-building as outlined in the accord or other measures such as finalizing national low-carbon growth and adaptation plans, improving in-country capacity to design and implementing national climate change actions as proposed by the UK, Mexico, Norway and Australia?

5. And last but not least, how will Africa build its capacity to be able to absorb and us additional climate funding after 2012, especially if it comes anywhere near the USD 67 billion for adaptation and USD 200 billion for mitigation as requested in the run-up to Copenhagen?

Despite all the shortcomings of Copenhagen, the rather timid initial financial commitments together with the prospect of something more substantial might provide a good opportunity to address these questions and make climate finance work for Africa

South Africa sports - a brand in itself

2010-01-25T10:12:00.002Z

I must be one of the last people in South Africa to see ‘Invictus’, Clint Eastwood’s film of the 1995 Rugby World Cup in recently post-Apartheid South Africa. As well as an incredible story, in which the Springboks came from underdogs to win in the final against the mighty All Blacks, it could also be seen as an observation on the power of PR.

Mandela had a deep, natural understanding of his audience, his ‘family’ as he puts it, and understood the power of sport to influence and unite a nation. Moreover, the incorporation of the Rugby World Cup into his drive for reconciliation would also deliver an intuitive and subtle fulfilment of the requirement to clearly brand this new nation on the international stage. Tourism, foreign investment, people and culture & heritage, are all core elements of a nation branding strategy and the Rugby World Cup, given its international prominence at a time when South Africa was looking for FDI, was a perfect vehicle.

Mandela ‘s belief in keeping the Springbok name and colours, something most associated with Apartheid, was brave and brilliant. Sending his ‘rugby troops’ into the townships to run rugby camps for kids who had never before touched a rugby ball, was what would now be called good CSR strategy, while inviting the press along, a PR coup. As Morgan Freeman, playing Mandela, states when footage of the team with the children appears on TV, those few seconds are worth a hundred speeches. A picture says a thousand words, and sport is emotive – with or without the Hollywood soundtrack.

Every business and organisation is trying to find the ultimate channel for its story, to change minds, gain followers, or to sell something. It’s no wonder so many big corporations choose sports sponsorship as a way to reach the masses. This year’s FIFA World Cup™ in South Africa has seen billions of dollars of sponsorship deals and advertising spend as companies try to make the most of the opportunity at home and abroad. One of the most interesting things about the 1995 Rugby World Cup as it plays out in Invictus is the absolute lack of money or large-scale expenditure – pure PR and branding through and through.

First East African CSR Awards to be held during World Economic Forum Africa

2010-01-20T20:55:00.001Z

In one month, the first East African CSR Awards, in partnership with the East African Business Council (EABC), will be launched and open for entries on 15 February 2010. The awards will take place on the evening of 5^th May 2010 during the World Economic Forum Africa in Dar es Salaam, Tanzania.

For the first time, East African companies will be honoured for their corporate social responsibility (CSR) activities and awarded for outstanding, innovative and high-class initiatives and programmes that create a high social and environmental benefit for the community and the business.

Entries will be accepted from any East African (Burundi, Kenya, Tanzania, Rwanda, Uganda) registered company, or from external individuals who are recommending a CSR initiative of any East African registered company.

East African businesses are encouraged to enter into the following categories:

(i) Best workplace practice;

(ii) Environmental excellence;

(iii) Most ethical & responsible business practice for supply chains; and

(iv) Most sustainable & scalable community investment.

As a preliminary entry criteria, the company must be able to demonstrate to high levels of corporate governance in their business operations and board decisions.

Entries will be judged by an independent panel of international and regional CSR, corporate governance and ethical business experts, and chaired by Elvis Musiba, former President, Tanzania Chamber of Commerce, Industry and Agriculture. The panel includes:

· Dr William Kalema (Managing Director DCDM Uganda and former Uganda Manufacturers Association)

· Ms Jane Nelson (Director of CSR Initiatives, Harvard Business School)

· Dr Judy Muthuri (CSR Lecturer, Nottingham University)

· Mr Steve Kenzie (Programme Manager for Responsible Business, International Business Leaders Forum and UK Focal Point for UN Global Compact)

‘These Awards mark a positive and promising trend in East Africa’s private sector toward a more responsible and ethical business pathway, leading the region’s sustainable economic growth’, Alhaji Bamanga Tukur, Chairman of africapractice (East African CSR Awards secretariat).

africapractice comments on CDM in Copenhagen on Point Carbon

2010-01-06T15:40:00.004Z

Africa needs further CDM reform: analysts
UN guidance to reforming the CDM may boost development in Africa, but more is needed.

Published: 06 Jan 2010 16:17 CET
(c) Point Carbon, http://www.pointcarbon.com/news/1.1364360 (subscription only)

At last month’s UN-led climate summit in Copenhagen, countries agreed to further guidance to the clean development mechanism (CDM), including measures to increase investment in countries that currently host fewer than 10 schemes.

While the CDM has raised billions of dollars for carbon-cutting projects in developing countries, 68 per cent of projects is dominated by China, India and Brazil.

To help foster development in poorer countries most vulnerable to climate change, the guidance suggests to defer payments and to provide loans to support in countries that lack projects.

“It certainly won’t hurt but it won’t turn things around overnight,” said Miles Austin with Ecosecurities, a developer of projects aimed at cutting greenhouse gas emissions.

“More reforms will be needed,” Austin said, pointing out that CDM development in Africa still suffers from a lack of demand for projects and a shortage of specialists, such as project auditors and consultants.

For instance, the CDM executive board could help improve demand by standardising a tool to calculate the emission factors for African electricity systems, he said.

The African continent accounts for less than 2 per cent of all registered CDM projects, with the bulk of the projects located in South Africa.

Eligibility criteria

Gregor Pfeifer, senior consultant at Africapractice, said that many African countries could benefit from the measures, particularly since they get around the more difficult criteria of regarding the general development status of host countries.

“While Africa is the continent with the highest number of least developed countries, the definition based on the number of registered projects (less than 10) includes countries such as Ghana and Nigeria, which are not LDCs,” he said.

Another measure calls for the CDM executive board to develop top-down methodologies for countries that lack investment, while requiring more transparency from auditors or so-called designated operational entities (DOEs).

The top-down development of methodologies should benefit the African continent given the relatively high costs and risks in developing a CDM methodology, according to Pfeifer.

However, it remains to be seen how suitable the methodologies will actually be for CDM developers in Africa.

Meanwhile, the requirement of reporting the amount of work done by DOEs may not be enough to remove the bottleneck in Africa, Pfeifer said, noting that some calls for the promotion of African auditors appears to have been excluded from the measures.

He welcomed the move for loans to cover the costs of the development of project design documents, validation and the first verification of projects which only need to be repaid starting from the first issuance of carbon credits.

“(But) if there was a genuine interest in promoting CDM in Africa in particular, grants and not only loans should also be provided,” he added.

By Jeff Coelho – jc@pointcarbon.com, London

Outcomes from Copenhagen - No legally binding deal but a Copenhagen Accord of vague commitments

2009-12-21T18:19:00.003Z

Climate change talks at Copenhagen ended last Friday, 18 December, without a legally binding protocol.

An agreement was brokered by the US and China, backing scientists' call to limit global warming to within 2 degrees centigrade against pre-industrial levels. But it contains no improved targets on greenhouse gas emissions from rich nations, does not commit anyone to a legally binding cuts and is not endorsed by the United Nations which needs a consensus from all countries to be enforced.

While it was endorsed by other big players such as the European Union, India and South Africa, the so-called Copenhagen Accord was rejected by smaller UN members such as Sudan, which during the conference acted as the chair of the G77 group of developing nations.

As part of the accord, rich nations agreed to quantify the amount of aid they were willing to give to poor nations to help them reduce their emissions and cope with the consequences of climate change.

Immediate, 'fast-start' aid was quantified at $30 billion over the next three years, with the EU and Japan pledging around $11 billion each, and the US offering $3.6 billion. Rich nations also set themselves the goal of 'mobilizing $100 billion a year by 2020 to address the needs of developing nations'.

One of the most controversial issues standing in the way of a legally binding deal between the US and China - which together account for about 40 percent of global emissions - hinged on the question of how much right third countries should have to inspect each other's greenhouse-gas emission claims.

While Obama had called for 'transparency' in the way emission targets should be monitored and reported, China strongly opposed any international exercise that would infringe on its national sovereignty.

The full significance of the deal will not be known until well into next year. Countries are supposed to fill in details of planned cuts in greenhouse gas emissions, left blank in the accord, by the end of next month. The UN is to follow with more talks towards a legally binding global treaty.

2009-12-08T06:53:00.001Z

The show has begun after an unprecedented series of preparatory meetings and fading optimism, the 15th Conference of Parties to the Kyoto Protocol has kicked-off its two-week marathon to forge a future climate agreement. The stakes are high – scientists and climate change advocates give us only a few more years for decisive action to avoid catastrophic effects that could trigger mass migration and the loss of cures of some major diseases through the loss of biodiversity and its treasures, just to mention two of the myriad of possible consequences. And a few years is a very short period of time in the world of global agreements and their ratification.
Despite all its complexities, it is commonly agreed that a breakthrough will rest on four main pillars: (1) a binding mid-term commitment by developing countries to reduce the their emission dramatically, (2) appropriate domestic action beyond existing commitment by industrialised countries, (3) equitable and predictable finance for adaptation to climate change paired with the transfer of clean technology to developing countries and (4) revised governance structure that will allow increased participation of developing countries.
Accordingly, the focus in Copenhagen will be on the two main bodies established in 2007 under the Bali Roadmap, the Ad Hoc Working Group on Long-term Cooperative Action under the Convention (AWG-LCA) and the Ad Hoc Working Group on Further Commitments for Annex I Parties under the Kyoto Protocol (AWG-KP) with Annex I Parties being most mainly industrialised countries.
Recent pronouncements by world leaders given momentum. China announced to reduce its emission intensity by 40 to 45 percent by 2020 compared to 2005 and the US promised to cut emissions by a less ambitious but still progressive 17% by 2020 based on 2005 levels. The recent meeting of Commonwealth leaders made a possibly breakthrough on finance by announcing a Copenhagen Launch Fund that would start in 2010 and building to a level of resources of $10 billion annually by 2012. Last but not least, Obama’s decision to participate in the high-level segment next week instead of just stopping by after picking up the Nobel Peace Prize.
Africa probably has the most at stake as the continent predicted to be most affected by climate change. This has lead African leaders to push vocally for up to $64 billion in adaption finance for Africa alone, combined with decisive actions on emission reductions without binding commitments for African countries. But while Africa might have only contributed about 3% to global greenhouse emission that caused climate change, it can be more than a recipient of compensation for historic climate change by others; it can be part of the solution. The continent has the potential to exploit another important natural resource and become one of the biggest carbon sinks to mitigate climate changes through its forests and agriculture, which should form an essential part of any new agreement. South Africa has taken a first step in showing how African countries can contribute with its surprising announcement to “undertake mitigation actions which will result in a deviation below the current emissions baseline of around 34% by 2020 and by around 42% by 2025”. Let’s hope for many more productive steps like this one.

Foresight 2010

2009-11-27T18:22:00.001Z

What do you think South Africa needs to do in 2010? (Aside from winning the World Cup).

That was the question that Judge Dennis Davis put to the panel at the GIBS annual “Foresight 2010” forum. A quick survey of the members of his jury presented a variety of bullish and bearish responses – as well as one too many “Pass” cards, and talk of creating rather than predicting the future. The optimists got cross-examined for being unrealistic, while the pessimists were lambasted for being vague.

To be fair, the Judge was right. For all the talk of needing values, accountability, active citizenship, public-private dialogue – what does that actually mean? When push came to shove, to state some concrete action that the government should do in 2010 nobody wanted to put their neck on the line. Which was – ironically – stated as part of the problem and why business avoided engaging in debate with government, by Brian Bruce, CEO, Murray & Roberts among others.

What we might agree on is that there needs to be a vision for South Africa. What I don’t agree with is that business and government should share one same vision. By their very natures they will diverge completely – their interests lie in different corners. Yes, there needs to be co-operation, whereby government facilitates business to reach its goal, but the friction between the two – and the role that citizens play across both – is what drives change, and hopefully progress.

Michael Jordaan, CEO, First National Bank, was one of the panellists who came back to the human resources that South Africa has – training and keeping talent. Without going into the debate around school and university education that they embarked upon, it is also a key theme emerging in the survey that africapractice is conducting of African businesses, opportunities and challenges for the year ahead.

Chief Rabbi Warren Goldstein took it one step further, talking about the importance of the human spirit, the need to have faith in people and their ability to deliver. However, he was also the one who addressed my question of what South Africa needs to do to improve the perception of the country abroad and attract foreign investment with a very swift and succinct response: “Crime”. How much faith does he have in the people committing the crime to stop, or the people set to stop it succeeding?

Wendy Luhabe, chancellor of the University of Johannesburg, had been the only one to reference the outside world (aside from mention of that old Global Economic Crisis, of course). What must foreign investors think of the lack of discourse and progress being made by the Government and Business Community in South Africa?
When push came to shove, and Judge Dennis insisted they give him an answer to what single step was needed, Bonang Mohale, chairman and VP, sales and operations, Shell, SA, said leadership, and repeated the old adage, "People get the leadership they deserve". I didn’t know that South Africa spends more per capita on education and healthcare than most countries in the world, but the results still point to failed leadership. Without government representation present, the panel represents some of the best business leadership the country has. If they can’t step up and take account for engaging government and civil society in the debate they talk about, then who can?

A thought provoking discussion, but one that brought up more questions than answers. Who will start the discourse? I can’t help thinking it will fall back to the media once again....

African Innovation Comes to London

2009-11-09T17:16:00.003Z

In the past month or so I have been spoilt for choice when it comes to Africa-focused events here in London. I am always pleasantly surprised by just how many Africa-enthusiasts are based on this little island – there are of course the 2 million-odd diasporans with family links to the continent and many others who have taken a keen interest in the continent for other reasons. I have found both types of people at Africa Gathering and BarCamp Africa UK recently and both events have been buzzing with ideas, entrepreneurialism and enthusiasm for positive change and innovation in Africa.

Africa Gathering in October brought together thinkers and do-ers ranging from philanthropist Bill Liao to the founder of FrontlineSMS, Ken Banks and the eccentric Kevin “Banana Man” Alan. The inspiring rapper Emmanuel Jal gave a moving account of his experience as a child soldier in Sudan and how he is only eating one meal a day until he has raised enough money for his charity Gua Africa to build a school in his hometown to educate young people affected by war.

I was at the first Africa BarCamp in the UK at the weekend along with a hundred or so other tech enthusiasts sharing some really exciting ideas. Miquel Hudin shared his website, Maneno (meaning ‘words’ in Kiswahili) which is a communication and blogging application built to serve the specific needs of Sub-Saharan Africa. Frederick Wamala from the LSE shared his thoughts on how we must secure Africa’s newly acquired fast internet from cyber crime in order for it to be an effective medium for Africa's development.

I’ve had some fascinating conversations at these events and have been really happy to see just how many people are as excited about opportunity in Africa as I am. Growth and opportunity have been key themes that have come out of both events as well as the African philosophy of Ubuntu (we are who we are because of others) which I see as fitting for the take-up in interactive and social media across the continent.

Things you might not know about Africa

2009-11-02T08:20:00.004Z

The africapractice team had emails flying round in response to the question: What do people not know about Africa?

There are plenty of preconceptions and misconceptions about the continent, but here are a few of the facts and figures that came up last week:

• Seven countries in Africa account for more than fifty per cent of the population (Nigeria, Ethiopia, DRC, SA, Tanzania, Kenya, Sudan)
• Africa holds about 10% of the world's proven oil reserves
• There are up to 100 million members of the African Diaspora
• The longest cable car in the world is in Nigeria
• South Africa sold $1.8 billion worth of cars to the US last year, putting us ahead of Sweden and Italy as suppliers to the US market
• Africa is most affected by climate change but only produces 3% of global emissions
• Approximately half the population of Africa is under the age of 18
• Kenya is one of only five countries in the world that generates more than 15% of their electricity from geothermal sources
• Africa is the fastest growing telecoms market in the world
• Nigeria has a population the sum of the thirty one smallest countries in Africa
• Only 4% of Africa's hydropower potential is utilised currently
• Rwanda is ranked first by the Inter-Parliamentary Union in terms of the percentage of female politicians in its lower chamber, with 56.3 percent.
• The largest cement plant in the world is being built in Nigeria
• South Africa is the first, and to date only, country to build nuclear weapons and then voluntarily dismantle its entire nuclear weapons programme
• Almost 50% of all African immigrants in the United States hold a college diploma
• In the mid 1990s, there were more phones in New York City than the whole of Africa. But if the growth curve in mobile devices in Africa continues, it is likely to surpass the United States in number of mobile consumers
• The city of Pretoria, in South Africa, has the second largest number of embassies in the world after Washington, D.C.

A list of facts won't change people's image of Africa in one go, but it's all part of a far richer picture then a lot of people realise exists.

Silicon Sahara

2009-10-09T08:51:00.001+01:00

Silicon Valley, Silicon Fen – where to next for the hot bed of technology development?

In South Africa you can debate Cape Town vs Johannesburg vs Durban. Not much to debate this week, however, as the Silicon Cape Initiative kicks off. One sign of the interest in this is the fact that #siliconcape wa trending in second place on Twitter (globally), which is quite substantial attention.

But there are still hurdles, which events like this will hopefully address. And looking outside of South Africa is one of them. 10,768 patents were registered in South Africa in 2008, with over 7,000 registered by foreigners. Driving home grown talent and innovation is going to be the challenge, and the opportunity, open to innovation hubs, VCs, universities, corporate and entrepreneurs.

Focusing on domestic investment in technology should not be at the expense of international investment, however. As Duncan MacLeod points out in this week’s Financial Mail the country needs to open up to investors, not scare them away. If the collapse of the talks between MTN and India’s Bharti Airtel points to protectionism by the government, we have reason to worry. Regulatory, commercial and operational hurdles will need to be addressed to invite more international investment.

Beyond South Africa, there are definitely contenders for Silicon Safari winners. Rwanda seems to be making huge strides, in a large part because of President Kagame’s appetite and agenda.

One example is the ICT Bus Project that launched last week as part of the Rwanda Development Board’s eRwanda Project. Two large buses, equipped with a server, 20 laptops, printers, photocopiers, scanners and other multi-media facilities – a kind of mobile Internet cafe - takes access to previously denied p especially in rural areas. Delivering training for children and teachers, providing access to ICT for SMEs, farmers and entrepreneurs, is where we will see the digital divide start to narrow.

While the private sector is a major driver for advancements of this kind and socio-economic development, when it comes to communications, the government needs to be behind the industry – facilitating competition, new entrants, fair regulation etc. Where South Africa has entrepreneurs, investors, business and technology minds, they need to meet in the middle.

But a last word from Cyril Ramaphosa, executive chairman of investment company Shanduka Group, who yesterday put the onus back on businesses to help SA to produce the skilled people it needed to grow economically. “The South African corporate sector often says that the skills shortage bedevils them, but to my mind that is a lazy excuse. It is a failure to grasp the nettle, take bold moves and embark on sharp and pointed (strategies) to produce skilled people in any discipline.”

Sounds like a challenge to me.

2009-10-08T15:40:00.002+01:00

Climate change: a long time coming?

No one needs to be told that climate change is topical at the moment. It's in the papers and the twitter feeds every day and if it's not an item on Nigeria being urged to declare Yobe State a desert area, then it's the Maldivian Cabinet planning to meet underwater to demonstrate the risk to its country from the expected global warming induced rising water levels The plain truth is that we are writing ecological cheques we just can't cash and if we are prioritising, it's this debt we should worry about, not the financial debt that has caused our ongoing global recession.

“The financial crisis is a result of our living beyond our financial means. The climate crisis is a result of our living beyond our planet’s means.” Yvo de Boer, Executive Secretary of the United Nations Climate Convention.

We have to stop living beyond our planet's means if we want to go on living at all. It's our long-term survival that climate change is impacting. And this is not news. In fact if you look at the climate change timeline in WWF's pocket guide to 'The New Climate Deal', the first time there was awareness that a crisis might be looming was 1896! What have we been doing with our heads buried in the sand for over a century? Below, with thanks to WWF, is the timeline:

1865: John Tyndall postulated that gases such as water vapour and CO2 in the “atmospheric envelope” retain the heat.
1896: Svante Arrhenius predicted that increases of atmospheric CO2 from burning fossil fuels would lead to global warming; a doubling of atmospheric CO2 could cause global average temperature to rise by 5ºC. The predictions of this Nobel Prize laureate (1903) went unnoticed for more than half a century.
1958: First continuous monitoring reveals rapidly rising CO2 levels in the atmosphere.
1970s: Beginning of period of atmospheric warming known as “global warming”.
1988: UN establishes the Intergovernmental Panel on Climate Change (IPCC) to assess the science of climate change.
1990: IPCC’s First Assessment is published. The year is subsequently established as the baseline year for future emissions targets.
1992: Earth Summit meets in Rio de Janeiro. Governments agree on the UN Framework Convention on Climate Change (UNFCCC), which commits them to preventing “dangerous climate change”.
1995: After a fierce debate, in particular with OPEC nations, the IPCC Second Assessment establishes the strong link between human-induced greenhouse gases and climate change, saying that “the balance of evidence suggests….” that global warming is caused by mankind.
1997: Kyoto Protocol is agreed under UNFCCC. It includes the first emissions reduction targets for industrialized countries, covering 2008-2012; all major nations sign up.
1998: Warmest year in warmest decade in warmest century for at least a thousand years.
2001: Nations agree on methodological and other details of the Kyoto Protocol in Marrakech. The USA and Australia refuse to ratify the protocol.
2003: European heat wave, which kills more than 30,000 people. Scientists later conclude it is the first extreme weather event definitely attributable to human-induced climate change. Scientists report a third of the world afflicted by droughts, double the figure for the 1970s.
2005: Drought temporarily turns Amazon rainforest from a carbon sink to a carbon source.
2007: Massive summer ice loss in the Arctic brings fears of an ice-free north; IPCC Fourth Assessment warns of faster and irreversible climate change; Bali Climate Conference lays out timetable for agreeing successor to Kyoto Protocol.
2008: Poznan Climate Conference in Poland; slow progress on negotiations as many wait for the new Obama administration in the USA to declare its hand.
2009: Make or break year for the climate, with negotiations continuing for a Copenhagen Protocol set to conclude in December.

What's also interesting is that while countries and governments acknowledge that we have to get started, they are reluctant to be held to account. Right here in South Africa, our government recently released a statement stating, "While South Africa acknowledges that it is a contributor to the overall global green house gases largely due to its reliance on coal powered electricity, we are committed to taking responsible action to reduce our emissions but we are not ready to agree to any targets that would undermine our growth trajectory. Like other developing nations-, we still face the major challenge of growing our economy to enable us to meet the Millennium Development Goals."

Reading between the lines: yes we are part of the problem and we promise to get around to fixing it, just not right now and we won't say when either. And while there may be mitigating circumstances, if one of the most sophisticated players on the African continent won't commit how can others be held to account? And all the while time keeps marching irrefutably on.....

‘Post-Crisis Africa: Old Challenges, New Opportunities', a talk by Dr Ngozi Okonjo-Iweala, MD of the World Bank

2009-09-18T12:23:00.002+01:00

The charismatic Dr Ngozi Okonjo-Iweala gave a presentation at my alumni university, the London School of Economics, last Tuesday, 13th September 2009. Her presentation was on ‘Looking beyond the Crisis: Challenges and Opportunities for Africa’ - a rather typical presentation title, but quite refreshing ideas from her side.

Her presentation gave a brief overview of the economic developments taking place across the continent since 1995, citing remarkable growth rates, reductions in armed conflicts, increased regulatory reforms and more transparent elections.

However, over the last three to four years, the continent has been struck with what Dr Ngozi referred to as the crises of the four ‘F’s’ – Fuel, Food, Financial which has led to a new crisis - the Fertiliser crisis.

During the presentation, she kept stressing the importance of stimulating growth by creating jobs. The World Bank are predicting a rise in average real GDP growth rates to 4.5% across the continent in 2010, however, jobs will lag behind.

Dr Ngozi then proceeded to talk through what she saw as the eight main challenges facing the continent in the years ahead, many of which have been cited before. These are:

· The role of government and its accountability

· The sustainability of public debt

· Economic volatility

· Corruption

· Political stability

· Climate change

· Augmenting Energy resources

· Accelerating ‘job-creating’ growth

The opportunities that she laid out however, were more unique. These included:

1. Promoting labour intensive manufacturing to spark technological innovation and competition. China will be driving this manufacturing growth and Africa should be looking to partner with China and India to service their industries rather than be undercut by Chinese and Indian goods.

2. Investing in the full agricultural value chain, from raw products to processed goods. Only 40% of Africa’s productive land is currently being cultivated. She cited the need to bring more female entrepreneurs into this sector as women largely comprise the agricultural workforce.

3. Climate change is a challenge, but also an opportunity. Currently, Africa uses only 8% of its renewable energy resources compared to 30% in Latin America. Investing in sustainable agriculture and clean technology can supply Africa with a new revenue source. The World Bank has just launched the World Development Report 2010 on Tuesday (22 September), which focuses on Development and Climate Change.

4. Repatriate embezzled resources and stem the outflow of financial and natural resources from Africa. This opportunity is off the back of the G20 financial summit pledging to put an end of tax havens and the OECD anti-corruption programme and convention.

The question and answer session raised a few interesting ideas as well, such as the need to implement strong tax reforms so that a government’s revenue doesn’t rely solely on exploiting natural resources. However, the main obstacles to this, and obstacles that Dr Ngozi faced when she was the Nigerian Minister of Finance, was the difficulty of tax administration and the narrow tax base, with many people still in the informal sector. She recommended that government should incentivise the set up of small and medium sized enterprises by placing a 0% or subsidised tax regime on these businesses for the first few years, and then slowly introducing a taxation system which provides them with resources and assistance.

The issue of regional integration also cropped up. Dr Ngozi was an advocate of regional bodies like COMESA and SADC but stressed that they could still do more. She was supportive of common currencies but stated that national currencies and economies need to have the correct systems to manage exogenous shocks first.

She summed up by stating that to prevent another financial crisis like the one we have just experienced, the world must establish multiple poles of growth. America was once the main growth centre and China and India are emerging. But more are needed. Dr Ngozi is confident that Africa can be the source of successful and strong growth centres.

Meeting for Africa in New York

2009-09-11T13:41:00.008+01:00

Near the end of September, New York will be a flush with Heads of state, CEOs and executives. They will be flocking to the city not just for the annual UN General Assembly, but also the annual Clinton Global Initiative, a CEO’s working lunch on the Millennium Development Goals (MDGs), the African-American Institute Awards Gala Dinner and the Africa Investor Index Awards.

Increasingly, businesses are being welcomed to governmental and multilateral events. It is a sign that all parties are recognising the need for collaboration and mutual understanding. And the growth of Africa-focused events is also a promising sign given the impact of the financial crisis on aid flows to the continent.

At the CEO’s working lunch on the MDGs, the main topic of discussion will be how Africa can make substantial headway to attaining at least some of the MDGs. The theme of this year’s African-American Institute Awards Gala Dinner is “Nurturing Democracy and Hope for Development in Africa.”. Interestingly, most of the sponsors are from the corporate world, including Constant Capital Partners, Chevron, DeBeers and Exxon Mobil. Corporates are being recognised for their contribution to Africa’s development and many businesses are doing a good job of it at that, as highlighted by Africa Investor’s Index Awards, which awards and recognises Africa’s institutional investors, stock exchanges, best performing listed companies, stockbrokers and capital market regulators. These awards demonstrate the burgeoning financial industry in Africa which is driving economic growth.

As for the Clinton Global Initiative Annual Meeting which brings together business, government, and civil-sector leaders to plan and launch specific projects, ‘Commitments to Action’, to address global economic, environmental, and social challenges, it probably comes as no surprise that most of these 391 commitments are projects based in Africa. Many of these commitments are from large corporations such as Diageo, Standard Chartered, Coca-Cola, Nestle, Guaranty Trust Bank, Equity Bank Ltd, and Philips. Again, it is a demonstration of the private sector driving social, environmental and economic development in Africa.

More obviously can be done - we are still along way away from attaining all the MDGs in all African countries. As it stands, corporate contributions to Africa’s social and environmental development mostly takes the form of philanthropic giving. However, there are signs that companies are beginning to view their role in Africa’s sustainable development slightly differently.

Over the next five to ten years, I believe we will see a shift from ‘Corporate Social Responsibility (CSR)’ thinking and a philanthropic giving mentality, to a more strategic approach to sustainability. I believe we will see the following trends:

· Business management strategies and the ways of doing business will increasingly start to embed ecological, social and ethical viewpoints and measurement tools and standards. Many MBA courses in the US and the UK are looking at the development of strategies which create business as well as social and environmental value.

· More companies will begin to tie their marketing strategies with green initiatives, as we have seen with electric and hybrid cars.

· Larger companies, through their public affairs department, will increasingly engage governments on environmental and social policies to deepen their understanding of public opinion and public policies especially in the themes of climate change, energy and water.

· Companies will move away from providing grants to non-governmental organisations to investing in stimulating small to medium sized social enterprises such as ‘clinical social enterprises’.

· All companies, large and small, will begin to use social media and online tools more frequently to improve their stakeholder engagement methods and transparency.

My hope is that businesses who are beginning to implement some of these initiatives are showcased at events like those taking place in New York, so that they can be replicated and adapted into other business models.

Doing Business 2010

2009-09-10T13:44:00.001+01:00

The International Finance Corporation (IFC), a World Bank institution, released its annual “Doing Business 2010” report yesterday. The audit looks at how countries around the world have improved the environment for small to medium businesses (including sole traders and entrepreneurs) to set up and do business.

Singapore remains at the top for overall “ease of doing business” but some interesting results for Africa – and opportunities for sharing best practices.

287 reforms were recorded in 131 economies (June 2008 to May 2009) – a record – but more significant was the fact that low- and lower-middle-income economies accounted for two-thirds of reforms in 2008/09. Is the economic crisis hitting developing nations harder than we thought, kick-starting reformers into action to attract more inward investment?

Rwanda – the top reformer - introduced reforms in 7 out of the 10 categories (such as registering property, enforcing contracts, getting credit, protecting investors), rising from 143rd to 67th place on the ease of doing business rankings – and the first time a Sub-Saharan African country has led the world in reforms. Liberia entered the top ten, while Mauritius and Sierra Leone were also recognised for leading in certain areas.

So post-conflict countries have a reason to reform as well it seems – again with the driver of attracting Foreign Direct Investment. While business reforms are only one part of economic development / recovery, it is one area that the government can manage, monitor and measure. The question is how much the private sector can influence the government – but big business has to realise the advantages of a thriving SME sector in that case.

Rankings are one thing – the World Economic Forum also released its 2009 / 10 global competitiveness index yesterday, to give countries even more numbers to compete on, but surely what counts is the experience in each country. As Penelope Brook, Acting Vice President for Financial and Private Sector Development for the World Bank Group said – absolute scores are what matter. A women trying to set up a retail business in South Africa is not going to care what others are going through in Ghana or Guinea; what matters is the speed and ease of processes for her. All the top rankings in the world count for nothing if people on the ground don’t experience change.

So where to from here? Is it the case, as Thierry Tanoh, IFC Vice President for Sub Saharan Africa, states, that we are seeing a sea change in the way Africa views investment, or is it a short-term shift in rankings due to circumstance? There are remarkable signs of progress in Africa, with the likes of Rwanda providing a roadmap for others, but the ability to maintain that momentum, and weather the storms of political, economic or social changes is crucial – for domestic and international audiences and investors.

African Approval of Obama

2009-08-04T11:36:00.001+01:00

In the week that Hillary Clinton arrives for her seven-country tour of Africa, how is Obama seen throughout the continent since taking office?

Much has been made of Obama’s Kenyan heritage in his popularity rankings, but the reality is that he is following a path set by his predecessor in the White House. For all the criticism and complaints about the Bush administration (which we won’t get in to here), George W did set a strong US policy for Africa, including the Millennium Challenge Corporation and the U.S. President's Emergency Plan for AIDS Relief, the largest commitment by any country to combat HIV/AIDS in history.

While Obama’s trip to Ghana, followed so quickly by Hillary’s tour, make for a very public show of the US prioritisation of Africa, the US already enjoyed 73% approval from 33 Sub-Saharan African nations in 2008 – compared to just 34% across the world on average (Gallup).

Gallup has released further stats from March / April of this year that show that six of the seven countries surveyed (Kenya, Cameroon, South Africa, Uganda, Senegal and Mauritania) have seen an increase in approval of the US leadership since 2008. From an increase of 25% in Cameroon to an 11% drop in the final country – Djibouti – media approval across the seven went from 80% in 2008 to 87% in 2009. Substantial – but I’m not sure it points to more than any global media frenzy around the first Black American President would produce.

More interesting would be to compare approval of the US with sentiment towards the Chinese across Africa, for example. Why do we continue to hold the US up as the most important benchmark? However, despite the increasing influence and involvement of the BRIC countries in Africa, the suggestion that the US is trying to counter China’s rise in Africa with Clinton’s tour is “is a Cold War paradigm, not a reflection of where we are”, as the assistant secretary of State for African Affairs told Bloomberg.

While we read, write and blog about the impact of the Obama administration on Africa, are we obsessing about the topic by force of habit, by virtue of the media profile the topic enjoys, or because it actually counts?

Indeed, what difference will the trip make to the average African questioned by Gallup? To the major oil and mineral exporters in the countries that Mrs. Clinton is visiting – a few tax breaks or trade agreements, perhaps. But looking back to the statistics, Gallup states that at least 3/10 respondents in each country in their survey said the U.S. president makes a difference to their country. Even given the variation from country to country, that still leaves an awful lot of people in Africa that feel the US president makes little or no difference to their country – a far more pertinent statistic in my opinion.

East Africa wired!

2009-07-31T16:46:00.004+01:00

East Africa suddenly finds itself inundated with optical fibre cable: the SEACOM cable went live just last week and hot on its heels is the Kenya Government sponsored TEAMS cable which is expected to be switched on in August – both cables battling to claim first-mover advantage and sell as much capacity as possible, as quickly as possible. The next attractions will be the EASSy cable and the France Telecom-owned Lion cable, which should both be connected within the next 8-12 months.

And so the region which has been inhibited by poor telecommunications infrastructure will literally have cable coming out of its ears by the end of 2010!

The first (and most anticipated) area of positive impact is cost. Even though the SEACOM consortium was quick to warn the public that they will have to wait a little longer for cheaper internet as industry players first want to recoup their investments, for countries which have largely been dependent on exorbitantly priced satellite connectivity, the region should still enjoy a noticeable drop in costs. This is because where satellite communication providers were charging as high as USD 7000 per megabyte, the SEACOM consortium will offer wholesale prices in the range of USD 100 per megabyte, with even more subsidised costs of between USD 10-25 to schools, research and health institutions. This is great news for businesses, learning institutions and individuals whose operating expenses will experience some relief in the medium to long term.

In addition to cost benefits, the region’s residents will finally be plugged into the world through reliable telecommunications infrastructure. What a dearth of opportunities this offers east Africa! The increased capacity via broadband internet will enable us to get more done faster - including, for instance, the ability to work collaboratively and securely across great distances, reliable video conferencing, even live streaming of audio visual content in a heartbeat and crystal clear VoIP calls. ‘Regular’ voice calls, international calls in particular, will also now be cheaper and more stable.

Governments in the region should quickly realise progress towards their anticipated socio-economic transformations as universal internet access draws even closer to becoming a reality. They have spent the last few years trying to understand and prepare for post-fibre East Africa - putting in place boards to manage and implement their ICT strategies and building policy and regulatory capacity in preparation for the changes that fibre will bring to their countries that cover critical areas such as identity theft, online transactions, the legality of e-communication and so on. They also expect to see business booming in the Business Process Outsourcing & Offshoring sector and countries like Kenya have already invested in marketing themselves as BPO destinations in Europe and North America.

This level of commitment is great for the region. It should inspire the confidence to stimulate the investments required to get more people and businesses online, moving transactions to cyber space in a region that has been reluctant to do so primarily for internet security reasons.

The push for the 24 hour economy just got a boost with fibre being able to support the communication requirements of companies that would seek to eliminate the traditional working environment altogether, enabling employees to work flexibly in terms of time and location.

The real value of optical fibre is in what the mwananchi (a.k.a. the guy on the street) does with it... the innovative African spirit has been waiting for infrastructure that is robust enough to support its ingenuity and now it’s finally here.

I can hardly wait to see what we do with it!

Barrack Obama in Ghana

2009-07-28T16:18:00.000+01:00

When it was announced that Barrack Obama was going to be in here in Ghana for an overnight visit the first reaction from journalists was to confirm the news from the US State Department website. Alas! the confirmation was given by the US president’s itinery that showed clearly that from the G8 meeting in Europe, he would make the journey to Ghana.

So the preparations began, as usual the effort to make things look better than they actually are for the visitor’s sake, at least for 2 days, 10th and 11th July 2009.

The US embassy staff were not particularly amused as this kind of visit means a lot of work for them, they had not completely rested from the 3 day long visit of President Bush jr, just 7 months earlier. That was closely followed by an election that they had to monitor until that last ballot was counted, so they were tired, very tired and now Obama was coming in, the gigantic plane had to find landing space and on top of that the famous President and his gorgeous wife wanted a visit to the slave castle, at least a two hour drive from the capital. The embassy staff had to worry about the “monster” (his car) traveling for two hours, passing through 17 Ghanaian villages, 4 major towns, and 2 major roundabouts, all the time along the ocean.

When the advance team arrived, they decided that the torture of preparation maybe too much to bear and so the helicopter might be useful, that way, the president gets to the slave castle in 15 minutes instead of 2 hours, and can stay for as long as he likes.

After the advance team departed to the US, the information about where and what the president would be doing was still very scanty, no one knew, several calls to the embassy received the same answer, “we don’t know yet, can you call in a couple of days please”.

The local information ministry did not know either until a week before the arrival when the schedule gradually began to form like a baby in the mothers’ womb.

Then the tussle over where to make that policy statement began. Ghanaians were feeling the nostalgia of the Clinton visit in 1998, he had spoken to 10,000 enthusiastic hosts at Independence Square in the company of his wife Hilary, and president JJ Rawlings the former “strongman” president of Ghana. That event was a performance to behold and many Ghanaians relished a repetition of such pomp, pageantry and ecstasy with a dose of Obamamania and the grace of Michelle to complete the menu. Well, it appeared the Americans were not similarly enthused nor so inclined, they wanted the address to be delivered before the legislative assembly, the body of lawmakers where the Harvard graduate come super-star President could intellectualize about stuff, audacity, dreams… and anything else.

As the discussion came down to the wire, compromise was the winner, yes the address would happen, yes it would happen before parliament, no it would not happened at the Independence Square but it would also not happen in parliament!

What then was the compromise, the address happened at the international conference centre, built in 1991 for the hosting of the summit of the non-aligned movement in Accra? It is a very modern building standing directly opposite the parliament house in Accra.

I got in late that morning but was treated very nicely by security, of course, I could not drive within 300 meters of the venue, security was all over, in this event you had the US president, the Ghanaian president, his vice president, 2 former presidents, one former vice president, (of course the political musical chairs would have it that the other former vice president was now president ) 230 members of parliament,78 ministers of state and representatives from important organization such as africapractice.

And, the speech was intellectual indeed, he called for strong institutions instead of strong men, the parliament cheered, then he called for new structures for aid delivery and the cheers continued, he said Africans owe their destiny to themselves, not many cheered, then he talked about Zimbabwe and nobody cheered.

He praised Ghana for sound constitutional practice and said the minority must be allowed to take as much credit as the majority and the now opposition NPP shouted hear hear, (after the Westminster tradition of cheering the PM whether he is making sense or not). He said minority voices must be heard in a democracy.

Earlier, he had had breakfast with the president and some invited guest at the castle. The invite list for both events was about the same.

One significant bystander’s observation about this visit is that the photographs never ceased to be taken and this time the photographs were the state officials themselves. That was discussed on radio, time and again. People felt that it was embarrassing; some people felt that it was ok to photograph the famous President even when he was standing in front of the photographer and waiting for the welcoming or goodbye handshake.

Any way, the visitor then left to Cape Coast where he spent a bit of time going through the slave castle and through the door of no return (after going through slaves were shipped off to the new world)

After the Cape Coast trip the president prepared and departed the shores of Ghana.

So, he came, he spoke well, he stayed at the Holiday Inn, he saw the hospital at Labadie and he went to Cape Coast castle.

That was a big stuff, now Ghana is on the map once again, what we do with it, is our challenge, let’s start the conversation.

Seacom has landed

2009-07-24T13:10:00.001+01:00

The much vaunted Seacom undersea cable, linking Africa to Europe, landed this week and many of us waited expectantly for our internet speeds to move into the 21st century. If you have been following developments on Twitter, you will know already that for some people the dream is reality and for others like “MwendaRiungu: The #Seacom undersea fibre optic cable has landed in Kenyan coast, 5 ISPs hooked up, then......nothing! Still waiting....... “ it has completely failed to deliver.

If truth be told, most criticism does seem to be coming from the East African community, both in terms of bandwidth speeds, non-disclosure of which ISPs have signed with Seacom and with the fact that pricing remains largely unchanged. Perhaps the very effective Seacom PR machine should have added an element of expectation management to its strategy?

The reality is that many of Kenya’s ISPs are still tied into satellite contracts and will need to wait until these conclude before investing capital in buying space on Seacom. Also, less Kenyans have internet access than South Africans - which means that less people are sharing the bandwidth and infrastructure costs. Over time, as more people ‘go online’ this should hopefully help to drive down costs.

In South Africa, the promised massive reduction in bandwidth costs (up to 40%) making Internet access much cheaper for South African users is also not likely to be felt any time soon. In fact, analysts reckon that only corporations are likely to see a drastic drop in their Internet bill and consumers will continue to pay high tariffs for voice and data services. The launch of the Seacom cable does, however, mean that there is now some competition in a market that has been monopolistic for years.

At the launch yesterday, Cyril Ramaphosa said that Seacom would serve as “a catalyst for the east and south of Africa to speed up its economic development”. In South Africa, rumour has it that Telkom is buying space on Seacom and in Kenya it is unofficially official that Safaricom is one of the ISPs hooking up. Students in South Africa will be among the first people to directly benefit as TENET, the university network, was connected to Seacom yesterday.

While the Seacom landing is going to continue to fuel debate over the next few weeks, some positive, some cynical and much disillusioned, the one sure thing is that it is a significant step forward for bandwidth creation in East and southern Africa. Seacom will soon be joined by two further cables. The East African Marine System (Teams), scheduled for completion later in 2009, will link Kenya and the United Arab Emirates, and the Eastern African Submarine Cable System (Eassy), which lands in many of the same countries as Seacom, is expected to start service in mid-2010.

Cadbury’s Dairy Milk goes Fairtrade… is this enough?

2009-07-23T12:04:00.004+01:00

Socially aware chocaholics are cheering Cadbury’s switch to Fairtrade this week. Cadbury’s Dairy Milk, which sells 300 million bars a year in the UK and Ireland, will now source its cocoa from Fairtrade farmers in Ghana, the biggest brand of its kind to make the move.

This development has the potential to introduce Fairtrade to a wider consumer audience and may have a positive impact on the lives of small-scale cocoa and sugar farmers.

However, Whilst Fairtrade guarantees farmers get a reasonable deal for their produce, the process of accreditation is a long and expensive one. Representation, knowledge and money are needed to get the Fairtrade stamp of approval and critics of the label assert that this inherently pushes many farmers out of the market. Cadbury’s Cocoa Partnership launched last year in partnership with the United National Development Programme (UNDP) is investing £45 million over 10 years in social and environmental initiatives in cocoa-growing communities. This pot of money is ensuring many Ghanaian farmers are getting the chance to become accredited suppliers of Fairtrade produce. Whilst this is a great step, it is unfortunately an unusual situation.

It’s becoming increasingly clear that agricultural productivity alone is not always able to provide a reliable livelihood for the growing populations in African countries. Hannah Kiarie, a Nairobi based food Technologist recently made the point that agro processing - turning primary agricultural products into other commodities for market - has the potential to provide additional income generating opportunities. There are of course, some prerequisites for agro-processing to be feasible (good infrastructure, water and electricity to name but a few) and with cocoa processing, there are even more hurdles; the fact that chocolate melts is just one of them!

I will be happily munching on Dairy Milk from now on but there is still a lot to be done to ensure farmers in developing countries not only have access to lucrative markets both locally and globally but also that their businesses are sustainable financially, socially and environmentally.

Superbrands - where to next?

2009-07-21T17:40:00.002+01:00

The annual Superbands survey always makes interesting reading – who has pushed who from the top spot, new entrants in the top 500... It gives a bit of an insight into what people care about and how brands are moving into the consumer consciousness.

This year, expanding on a trend we’ve seen in recent years, tech takes precedence. While Microsoft took number one, bumping Google to number three (after Rolex) the order isn’t of so much importance as the volume of IT brands.

The Telegraph quotes Shar VanBoskirk, analyst at Forester: "You may drink a Coca-Cola or Starbucks drink once or twice a day, but most of us interact with Microsoft and Google every hour of our lives. These technology companies have entered into our homes, our offices - even our friendships."

So the question is who or what is next?

The FT raised this question earlier in the week, covering a research report by Wolff Olins, that tipped five food and drink brands from emerging markets to become global brands. As it stands now, there are no African brands in the list (Columbian coffee, Saudi fruit juice, Lebanese chocolate, Chinese wine and Indian liquor). So no tech here then?

Their focus on the East comes from market size – if you are to become a dominant brand you need dominant position in sales and customers – hence India and China. But Africa represents an enormous opportunity of almost 1 billion consumers, with increasing buying power. Not only that, but the “what works in Africa works anywhere” position makes for a hotbed of innovation and new ideas. MXit, the IM platform for mobile, developed in South Africa, is already looking at 17 million registered users across the world.

It will be interesting to see the ensuing battle between established western brands and new names from emerging markets. While everyone seems to be looking East, I’ll have my eyes peeled for the Starbucks of Sub-Saharan Africa or the Rolex of Rwanda.

Kicking the tyres - slow but steady trickle of investment into Zimbabwe

2009-07-16T10:32:00.007+01:00

“I am really getting sick and tired of these endless investment conferences, seminars, delegations.
All these gatherings have yielded nothing except talks, official addresses and some politically correct statements from the foreign delegates of what a promising country Zimbabwe is, and that’s it. When these people leave, you will never hear of them again,” ranted a Mr Chinenhamo in a Zimbabwean weekly newspaper.

My initial reaction was to chuckle at Mr Chinenhamo’s comments but after exercising my mind more on his contribution, his frustration seemed justified and encapsulates the frustrations of capital starved Zimbabwean companies - the unity government has come into being, the economy has stabilised, the country is no longer top of the inflation charts, successful Zimbabwean business has little debt, the country’s infrastructure is relatively intact, the workforce is highly skilled ....... the list of positives goes on. So what more could an investor need? The real money should be flowing by now! On the other hand, Mr Chinenhamo’s sentiments reveal the expectations of some local businesses and some in the general population that investment into Zimbabwe should happen immediately because on the private sector side, they have ticked all the boxes they feel they need to have ticked– the reality is often very different - it is a process and not an event to attract the calibre of investment Zimbabwe needs.

Investors have been well aware of the country’s potential but because of the previous 10 year economic crisis in Zimbabwe, that potential could not be converted to reality. Zimbabwe was one of those countries which geologists would speak about the vast mineral resources, and the financially astute would fawn over their returns from the local stock market. Bar the odd mining multinational and a few tyre kickers looking to build a relationship ‘for when things turn,’ the level of new FDI into the country was extremely low. In 2007, inward FDI flows into the country were about 14% less than that of Swaziland. Now things have changed. For those multinationals that kept their operations functioning, they are seeking to recapitalise their Zimbabwean assets, for those that left, they are now looking at re-entering the country. Slowly investment is beginning to trickle into the country. There is widespread acknowledgment that the political changes are permanent and the economy has responded positively.

One of our clients, African Sun has interests in the Zimbabwean hospitality sector and their Chief Executive, Shingi Munyeza, commented that their city hotels in Harare were almost at 70% occupancy in the first half of the year driven by international business-people. He also gave an interesting anecdote about the number of Gulfstreams at Harare International Airport – which got me thinking about creating a GulfStream Index as a proxy for international investment activity...........that discussion will be reserved for another blog though!

It would be very naive not to consider the history, political environment and perceptions surrounding any sort of large scale capital investment in the country – these topics have been covered in detail in many other forums, but three stick out; i) concerns over policy consistency ii) property rights and iii)indigenisation (Zimbabwe’s version of BEE). The government does have a clear position on these matters and a call to the Ministry of Industry and Commerce could provide one with the clarity they need. The ministry has set up the Zimbabwe Investment Authority, a one-stop shop providing investment advice on the country. The challenge now is to communicate that vision clearly.

Then again, perhaps I’m being unfair to Mr Chinenhamo, and his statement was merely a call for action. Any takers?

"Make investing easy, Africa told"

2009-07-08T09:14:00.002+01:00

That’s the headline on the front page of Business Day’s Companies & Markets section today. That’s an issue we talk about a lot, often in the context of the role of media in developing a healthy investment climate. It also came up at the World Economic Forum (WEF), as we outlined in a post below.

But it seems it takes a bold statement by Standard Chartered at a conference in Sandton to make the news. At the Banking Outlook conference, Steve Brice, head of global markets Southern Africa, talked about the need to counter the impact of the financial crisis, the impact of which was not yet fully understood on the continent.

Plenty of reasons why African countries are suffering in the downturn, but his advice to “stick to their knitting” and be internally focused, seems to go against his over-arching call to be more externally-focused to attract foreign investors. No wonder we’re not making this easy on ourselves..

US President Barack Obama takes a different approach in an interview with AllAfrica.com today, stating African nations must clean up corruption and end political instability in order to attract the investment needed to prosper. ‘Speaking in advance of a visit this week to Ghana, Obama said there was a direct correlation between governance and prosperity and urged African leaders to do better.’

In terms of ease of doing business, the average ranking of sub-Saharan countries is 138 out of 181 countries globally. So there are worse places. Remember, this is not a comment on the attractiveness of doing business, but in terms of how to lift Africa up the rankings to a place that is easy to do business, there doesn’t seem to be a simple solution. The measures that Brice puts forward, developing long-term interest rate and forward foreign exchange markets are – on his own admission - “easy to say and difficult to do”. Obama’s solution of ending corruption and political instability is a pretty tall order too..

Raila Odinga, Prime Minister of Kenya told WEF that Africa has to knock down the hurdles to doing business, such as lengthy legal and operational processes - but this has to be permanent, not temporary measures. Omari Issa, CEO, Investment Climate Facility, commented that African media needs to be part of changing the perception of Africa as a good place for business, as investors still often look to international media for info – and it needs to come from the inside.

This raises the question of whether it is just an external perception – or a reality - that Africa is a hard place to do business? Will it always be more difficult than an America or Germany, and investors just need to get over it and go for it? While there are undoubtedly people and processes that could make foreign investment easier, is it just a different way of doing business, which also sees different returns?

I don’t mean to push the onus of finding a solution back on to the international investors, but like any form of regulation or policy change, it is external pressure that will make things happen. Internal change or any kind of self-regulation is never easy, without the threat of losing something – and foreign investment is no small thing – especially in a downturn. We can at least agree on that.

Zuma calls for Africa Agri-forum

2009-07-07T09:22:00.001+01:00

President Jacob Zuma yesterday called for the creation of a ‘Conference of African Agriculture Ministers’ saying such a forum would fight hunger and poverty by facilitating agribusiness investment opportunities.

Africa’s agricultural sector is beginning to emerge as one of the sectors that will buffer African economies against the global downturn.

And given the challenges presented by the global financial crisis, and the growing threat of food security, Zuma urged the ministers to remain committed to the Maputo Declaration, which requires governments to spend at least 10% of public expenditure to agricultural development. Currently, only 10 countries in the African Union allocate more than 10% of their budget to agriculture.

Zuma’s focus on agriculture is in line with other leaders who have identified the potential of this sector to lift Africa out of poverty.

In their 2009 Economic Outlook Report, the United Nations Economic Commission for Africa singled out agricultural investment as the most important area for Africa’s development. The private sector is also seeing the opportunities that the sector holds. For example, the Danish Government, through its Africa Commission, launched a project in May 2009 to target private sector investment in agriculture

According to the Commission, if Africa processed 650,000 metric tonnes of cashews it would create 1,000 new businesses, 250,000 new jobs and an extra $150 million in annual revenue.

There are others, however, who argue that prioritising agricultural production will only cement Africa’s already weak terms of trade in the global market. The key, however, is to implement fair land distribution programmes since land tenure is a huge issue in Africa, improve rural infrastructure and integrate the agricultural sector with other sectors such as manufacturing in order to generate job creation and broad-based growth.

At the 13^th Ordinary Session of the African Union summit this week, Zuma called for integrated African agricultural value chains that would link up with the global marketing system. This is a positive recognition of what needs to be done to ensure Africa’s agricultural potential is harnessed effectively.

World Bank report highlights downturn in growth and capital flows to SSA

2009-06-24T10:40:00.001+01:00

On 22 June, the World Bank released its 2009 edition of Global Development Finance, in which the institution indicated that the world economy would shrink by 2.9% this year vs a 1.2% growth in developing countries. In this latter group, investment flows ebbed to $707bn in 2008, significantly down from the $1.2trn recorded in 2007.

In the case of Sub-Sahara Africa (SSA), the World Bank highlighted that the region had been hit hard by negative dynamics in external demand, plunging export prices, weaker remittances and tourism revenues, and sharply lower capital inflows. Growth in SSA is now seen at 1% in 2009, from 5.7% in 2006-08, although it should strengthen in 2H09 and may rebound to 3.7% in 2010 and 5.2% in 2011, respectively.

On World Bank data, the fastest growing economies in the region in 2009 include the Republic of Congo (7.4%), Malawi (6.6%), Ethiopia (6.0%), Rwanda (5.1%) and Uganda (5.0%), while six nations could experience a contraction in GDP growth (of which Seychelles' is estimated at -10.5%, Botswana -8.0%, and Angola -1.9%). Nigeria is forecast to expand 2.9%, in line with the IMF projection.

WEF: A Future Roadmap for Africa

2009-06-19T12:54:00.004+01:00

The World Economic Forum in Cape Town last week brought together the public, private and non-governmental sector, as well as media and commentators on Africa.

Here, a final word on Africa’s Roadmap: From Crisis to Opportunity

Maria Ramos, CEO, ABSA Group: If we can build world-class stadiums we can build schools and health centres. We have the capacity, just not the execution. Africa is only limited by its imagination.
Graca Machel: Founder, Foundation for Community Development (Mozambique): We need to bring women and young people into the discussion. Women are more than half of emerging markets so must be part of the re-design of a world that equally belongs to them. They bring more than just numbers; but also entrepreneurship, talent, experience.
Graham Mackay, CEO, SAB Miller: The reality is that business creates wealth. If we could get Africa to grow by 6-7% instead of 4-5% we could solve most of the issues that we have talked about here today.
Soud Ba’alaway, executive chairman, Dubai Group: Africa needs to take risks. To realise opportunities and success you need more than plans, you need to execute. Africa is a land of opportunity and needs to celebrate its success stories.
Jacob Zuma, President of South Africa: We need to look at improving the perception of doing business in Africa. Larger economies on the continent should play a bigger role, but smaller ones also need to be ready to work together. South Africa is very transparent – you know the good and the bad of being here as a business, but we will continue to invest in creating jobs and changing the economic landscape.
Five key priorities for investment and participation:
o Privatise education
o Improve health
o Combat crime
o Rural development
o Improve infrastructure

WEF: Football, phones and food

2009-06-18T13:05:00.003+01:00

The World Economic Forum in Cape Town last week brought together the public, private and non-governmental sector, as well as media and commentators on Africa.

Here, we summarise the sessions on the 2010 FIFA World Cup, the mobile revolution in Africa, and the agricultural sector.

FIFA World Cup 2010: Building a Legacy for Africa

Danny Jordaan, CEO 2010 FIFA Wolrd Cup Organising Committee: We recognise that hosting a major event can contribute to an integrated local government, better infrastructure etc. We are putting this country on the coffee table of the world. You can’t have a FIFA that is rich in a country that is poor. They said don’t do it in Africa, but FIFA is in the best financial position it has been in for 100 years, with 70% of profits going back in.
Kgalema Petrus Motlanthe, Deputy President, South Africa: The AU Summit in 2007 agreed the World Cup was for the whole of Africa. The key challenge is to extend the connectivity with the rest of the continent.
Michael Jordaan, CEO, First National Bank: Recognising we’re not there yet is key – South Africans work well under pressure. We will get there. Often the benefits of hosting a World Cup are over-estimated. It’s not just about money, it is about sport, branding, clearing up misperceptions. Legacy thinking is a great way to plan your business, family or government – we hope that we can use the momentum of 2010 to continue good work afterwards.
Helen Zille, Premier of the Western Cape Province: The legacy of 2010 will be that we change the perception of what African can do, we show that we can produce the best World Cup ever seen, delivered on time, on budget, with unity. If we put as much effort in to our education as we do into our sport, we'd solve a lot of problems.
Five key legacy pillars of the FIFA World Cup 2010:
Ø Infrastructure
Ø Job creation
Ø Tourism
Ø Nation building
Ø Country branding

The Mobile Revolution
Ory Okollo, founder, Ushahidi: What’s next for the mobile story beyond basic applications? How to lower cost, how to get networks to talk to each other. We need to move the conversation beyond penetration to commercial and development opportunities. But mobile development doesn’t always have to be connected to social good. We are human, we need to communicate – whether African or not. Mobile development should focus on enabling communication and making money doing that, everything that comes on top is extra.
Wolfgang Lehmacher, CEO, GeoPost Intercontinental: Hurdles in infrastructure are not so much hurdles, but drivers of innovation.
Michael Joseph, CEO, Safaricom: 70% of Africa’s economy is informal – and they need methods of communications to work too, which also impacts social life, health, education etc. The next revolution is mobile payments. Mobile money will fundamentally change the face of society.
Nicholas Nesbitt, CEO, KenCall: The future is not about having a laptop anymore. It’s about how you get the information you need when you need it. Technology can make national and global content accessible.

Africa: The World’s Potential Breadbasket?
Sylvia Matthews Burwell, President, Global Development Program, Bill & Melinda Gates Foundation: There’s no silver bullet but we are optimistic that the green revolution can succeed, working in strong partnerships.
Harish Manwani, President, Asia, Africa, Central and Eastern Europe, Unilever: Why the commitment to food security? No choice. Most businesses today depend on emerging markets for growth. Three themes in food security – Sustainable agriculture, engagement with small farmers, public-private partnerships. Africa needs the ambition of not just solving hunger but creating a better world. Changing the mindset comes from government policy change and local farmers who need to understand how they can make money –key to the green revolution.
Kofi Annan, Co-Chair of WEF on Africa: People don’t starve in democracies. We need sustained leadership and commitment to agriculture. But we also need to commit our own resources and show we are serious.