Africa Top10 Business News

Lessons other African Airlines Can Learn from Ethiopian Airlines

Despite the recent tragedy, Ethiopian Airlines (EA) is an example of what other airlines such as South African Airways (SAA) should strive for. The airline, like its South African counterpart, is a fully government-owned and operated company, but it is run by professionals with aviation experience. African aviation is expected to grow at 5.4 % a year over the next 10 years and forms a key part of the economic lifeblood of the continent. SAA and EA are the two top-rated African airlines based on size and customer feedback, and should therefore benefit most from this potential growth. While Ethiopian Airlines has consistently projected a profit over the past five years, SAA has consistently shown negative profitability year-on-year. Both SAA and EA employ about 11,000 people and have adopted an “open skies” policy, which affords them to access similar foreign routes. Both airlines have a mix of aircraft models, which is supposed to result in mid-range cost performance, but the average age of SAA’s aircraft is 10 years, while for EA it is only six years.  

SOURCES: BUSINESS DAY LIVE

Africa’s Largest Mobile Network to Benefit from Jumia NYSE Listing

Jumia, Africa’s largest e-commerce platform, has filed for approval from the US Securities and Exchange Commission to do an initial public offering on the New York Stock Exchange. The public offering will give one of its largest shareholders, MTN, the opportunity to sell about $600 million in shares towards clearing its debt. The venture became the first African startup unicorn in 2016, achieving a $1 billion valuation after a $326m funding round that included Goldman Sachs, AXA and MTN. The New York filing did not say how many shares Jumia would sell, nor at what price. Founded in Lagos in 2012 with Rocket Internet backing, Jumia now operates multiple online verticals in 14 African countries, spanning Ghana, Kenya, Ivory Coast, Morocco and Egypt. Goods and services lines include Jumia Food (an online takeout service), Jumia Flights (for travel bookings) and Jumia Deals (for classifieds). Jumia processed more than 13 million packages in 2018, according to company data.

SOURCES: BUSINESS INSIDER | TECH CRUNCH

Can Africa Satisfy its Bulging Appetite for Meat?

The continent’s population is projected to more than double by the middle of the century to 2.5bn and GDP per capita on the continent is expected to continue rising, meat consumption will become affordable to millions of Africans for the first time. The United Nations Food and Agriculture Organisation (FAO) estimates that the consumption of beef on the continent will increase 200% between 2015 and 2050, while poultry consumption will grow by 211% and pork by 200%. Opportunities for investment are likely to prove more attractive in Africa than other global regions, according to the organisation, with future investments required across the value chain in poultry and pork facilities, abattoirs, feed production, transport and equipment supply.  According to the FAO, a successful investment strategy to benefit smallholders would involve identifying those smallholders that are business-oriented and have incentives to expand their production and tap into the livestock products market.

SOURCES: AFRICAN BUSINESS MAGAZINE

A First of its Kind List by Forbes Woman Africa

The New Wealth Creators is a collection of female entrepreneurs on the African continent running businesses and social enterprises that are new, offbeat and radical. These 20 women have been selected because they have created significant impact in their respective sectors by transforming a market or company, or innovating a product or service, and are pioneering their organization(s) in generating new untapped streams of income. They may be wealth creators but their businesses, ironically, did not stem from a need to make money, but rather from the need to solve Africa’s persisting socio-economic challenges. These women come from across the continent, from the villages and the suburbs, and are in their 20s, 30s, 40s and 50s. They have all adopted sustainable development initiatives in one way or another to help solve Africa’s problems.

SOURCES: FORBES AFRICA

Lawmakers Question Kenya’s Infrastructure Deals

Kenyan MPs have asked how a 10km wire fence built along the country’s border with Somalia cost $35 million. The government had originally promised to build a complex wall to run about 700km along the border. But the “wall”, which was meant to stop al-Shabaab militants from crossing into Kenya, has ended up being a wire fence that is only 10km long. Kenya’s parliament has now suspended construction, and is demanding an investigation into the project. When the plan was first announced in 2014, the government said it would build a 708km wall made up of a series of concrete barriers, fences, ditches, and observation posts overlooked by CCTV stations. Under this plan, the wall was meant to stretch from the Indian Ocean all the way to the border region of Mandera, where Kenya and Somalia meet Ethiopia.

SOURCES: BBC

Solving the Primary Barriers to Development in Sub-Saharan Africa

An estimated 600 million people in the region live without reliable power and all that goes with it. A growing number of electrical entrepreneurs are stepping into the breach. Companies such as M-Kopa and BBOXX offer contained solar power systems to off-grid communities, and US company Zola Electric — formerly Off Grid Electric — supplies “Solar as a service” to isolated areas. Zola’s “Infinity” product serves as a standalone “mini grid” that draws on multiple energy inputs and a smart storage system to provide continuous power. Infinity can be connected to an existing grid, solar power units, and backup generators, switching seamlessly between them when they fail. The lithium battery also stores energy so that power is maintained if all inputs fail at the same time, according to its makers.

SOURCES: CNN

Was DRC’s New Administration Bought?

Whistle blowers say parliamentarians are offering their votes to prospective senators in the Democratic Republic of Congo for as much as $50,000 apiece. The allegations raise the prospect of further discord in the world’s biggest cobalt producer two months after a disputed vote installed former opposition leader Felix Tshisekedi as president. Runner-up Martin Fayulu said the Dec. 30 presidential and parliamentary polls were rigged and accused Tshisekedi and his predecessor Joseph Kabila of making a backroom deal to deprive him of his rightful victory. Both deny any wrongdoing.

SOURCES: BLOOMBERG

The Hidden Economic Costs of Displacement

While the impacts of displacement on wellbeing are well-known, one group has pointed to the equally burdensome economic costs for those displaced as well as host communities. In a new report, the Internal Displacement Monitoring Centre (IDMC) examines the financial costs of internal displacement across major crises around the world, raising awareness of the importance of preventing future displacement as well as responding to such situations efficiently. The report also notes that the impacts of internal displacement are far higher in low-income countries, partially due the lack of capacity to minimise impacts of crises. The Central African Republic (CAR) is one such low-income country, with over 70 percent of the country estimated to be living in poverty. CAR has seen decades of instability and violence, and its most recently conflict has resulted in an ongoing, dire humanitarian crisis and the displacement of over 1 million people, more than half of whom have stayed within the country’s borders.

SOURCES: AFRICA.COM

Safaricom and Aliexpress Strike a Key Deal

Kenya’s mobile operating firm Safaricom, has secured a deal with China’s largest e-commerce company. The deal will enable Kenyan shoppers to buy goods on the Aliexpress.com site, run by Chinese e-commerce giant Alibaba Group, using Kenya’s M-Pesa mobile payment service for online shopping. The new partnership with AliExpress will not affect the telco’s e-commerce platform but seeks to address small traders needs as it continues to expand M-PESA’s capabilities. M-Pesa was launched in 2007 to offer Kenyans without bank accounts a network to transfer cash via mobile phones. It now offers a range of payment services, loans and savings to more than 21 million people in the country.

SOURCES: AFRICA NEWS

How to Decipher Zimbabwe’s Economic Crisis

While policymakers use technical vagaries to explain away the crisis, an ordinary Zimbabwean has created the most succinct explanation through a two-minute animation. “I created it because I had the impossible task of explaining what happened to the money to my daughter’s Grade 7 class,” Kuda Musasiwa told Quartz Africa. The animation achieves what policymakers and analysts have struggled to do: distil the crisis to its simplest form. Importantly, it explains how the banking system affects consumers. In it, dollars are cows and bond notes are goats, and Musasiwa tries to explain how the Reserve Bank forced consumers to believe they held the same value. It takes a tragicomic turn when Musasiwa has to explain Zimbabwe’s use of mobile money due to a currency shortage. Musasiwa, a rapper who also runs a vegetable delivery service and an advertising agency, knows the very serious consequence of the currency shortage or a crash in the mobile service network.

SOURCES: QUARTZ AFRICA