Africa Top10 Business News

MTN Group Ltd. appointed former South Africa Deputy Finance Minister Mcebisi Jonas as chairman; he will replace Phuthuma Nhleko, who plans to step down in December after almost two decades as chairman or chief executive officer of the Johannesburg-based company. Jonas, who was already a non-executive director of MTN, was deputy finance minister for almost three years before being removed by former President Jacob Zuma in 2017. Nigeria’s ex-central bank Governor Lamido Sanusi has been appointed as a non-executive director this comes as MTN prepares to list its local Nigerian unit on the Lagos stock exchange, a condition of the settlement of a $1 billion regulatory three years ago. The business is the largest of MTN’s 20-market portfolio, accounting for almost a quarter of all subscribers, and has been hampered by a series of government and local authority disputes that have hurt the company’s share price. Sanusi is now the Emir of Kano, a high-ranking position in Africa’s most populous nation and biggest crude producer. A separate board of prominent people to advise on broader African issues will be headed by former South African President Thabo Mbeki and includes John Kufuor, ex-leader of Ghana and Nhleko will also be a member of that committee. The stock held onto gains and traded 2.4 percent higher. MTN shares have gained almost 19 percent this year, valuing the company at 199 billion rand.

SOURCES: BLOOMBERG

If Sierra Leone’s diamond industry is to make a positive contribution to the socio-economic development of the nation, as envisaged in the government’s new five-year National Development Plan, there has to be a radical overhaul of the way the industry is managed. At the centre of any such strategy should be a concerted campaign to curb the rampant smuggling of diamonds, which leads to tens of millions of dollars of potential tax revenue being lost each year. Less remarked upon is the fact that official corruption still plagues the industry. Diamonds were discovered in Sierra Leone in 1930. The 1960s are seen as the post-independence benchmark for probity and proper management of the industry. By the 1970s and 1980s, due to massive corruption and mismanagement under the All People’s Congress government of Siaka Stevens, most of the country’s gems were being sold abroad illegally. Smuggling has been blamed on artisanal miners and on small-scale, illegal mining operations in remote areas that are not regulated by local authorities.  After farming, artisanal mining is the second largest employer of labour in the country, providing a livelihood for up to 500,000 illiterate or poorly-educated day labourers. Many observers refuse to believe that the small-scale operator should alone shoulder the blame for “revenue leakages”.

SOURCES: AFRICAN BUSINESS MAGAZINE

Sanctions against the Democratic Republic of Congo were introduced in 2006 and then extended several times. Like other countries, the US barred officials from entering its territory and froze assets and operations of officials and organisations linked to them. In 2007 the US imposed unilateral economic sanctions against Sudan. Thirty Sudanese companies have lost the opportunity to trade with America and receive funding from US banks. Their assets in the US were frozen. In 2011 the US imposed sanctions against then president Laurent Gbagbo, his wife and supporters because Washington did not like the cancellation of elections in some cities in that country. In February 2011 then President Barack Obama signed a decree imposing unilateral financial sanctions on then Libyan leader Muammar Gaddafi, his government and family members.  According to the decree all property and bank accounts belonging to Gaddafi, his government and four relatives were frozen. A ban was imposed on any banking operations with the government of Libya. In 2014 amid clashes between the government of South Sudan and the rebels, sanctions were imposed. The restrictions included the freezing of assets belonging to individuals and Americans were barred from engaging in financial transactions with them. Sanctions against Zimbabwean leaders were imposed in 2003.  Those in the list of targeted sanctions also had their assets frozen and they were barred from travelling to America. The US sanctions have been renewed annually since then. The US has maintained its theory that the sanctions are “targeted” at 141 entities and individuals in Zimbabwe. At the same time, the US administration claims that the sanctions apply only to representatives of the country’s leadership, a number of banks and enterprises. Washington maintains the sanctions are not directed against the people of Zimbabwe. In reality of the situation is that the sanctions are broad-based and are squeezing the heart of Zimbabwe’s economy — the financial services sector.

SOURCES: THE STANDARD

It’s well-established that South Africa has one of the most unequal income distributions in the world. Despite significant efforts by the State to stimulate inclusive growth, the income gap between the rich and the poor has continued to widen in post-apartheid South Africa. A less explored topic is that of wealth inequality and, relatedly, the potential use of wealth taxation to reduce wealth inequality while also further diversifying the sources of much-needed government revenue. In 2015, the wealthiest 10% of South Africa’s population owned more than 90% of the total wealth in the country while 80% owned almost no wealth. These findings resonate with more recent findings documented in reports produced by Oxfam (2018) and the World Bank (2018). There’s a clear racial dimension to this inequality with an average African household holding less than 4% of the wealth held by an average White household. It’s a challenge to economic development when the bottom 80% of the population own no wealth, especially when a vibrant middle-class is a key ingredient in economic progression, as evidenced in advanced economies. If a non-zero wealth tax rate were to be applied, it should be progressive in nature, for example, by providing a high threshold below which no tax is payable. In turn, this data would provide the South African Revenue Service with improved data to test whether high net worth individuals are being taxed correctly within the income tax system.

SOURCES: QUARTZ AFRICA

From algorithms to track “dark” ships smuggling stolen crude oil to an online licensing system to undercut corruption, one Nigerian government agency hopes it can use new technology to tackle theft which has cost the country billions. But some say the initiative by the Department of Petroleum Resources (DPR) may be too late to stem the migration of energy majors to the relative safety of drilling at sea, driven offshore by an illegal trade that Nigeria’s sprawling bureaucracy has for decades proved unable or unwilling to tackle. Africa’s top oil exporter has turned to French data firm Kpler, just six years old and staffed by a hundred mostly young employees, to help it ferret out the smugglers from the thousands of ships plying Nigerian waters. The DPR began its collaboration with Kpler in December and unveiled it this month, among other tech-focused plans to detect what it calls “rogue” or “dark” ships.

SOURCES: REUTERS AFRICA

Just before close of business on Jan. 7, Shannon McLaughlin, founder and owner of Ubuntu Baba posted a 2,000-word blog explaining how she felt South African retail giant Woolworths had copied the name, color scheme and design of her company’s signature baby carriers, and was selling them at a third of the price. Ubuntu Baba carriers are handmade from organic hemp in South Africa versus the copycat carriers mass produced in China and made out of polyester. Just like that, the 36-year-old sent a shock wave through big retail in South Africa and showed small businesses around the country that big checkbooks and expensive lawyers can be beaten. The carriers were pulled from Woolworths’ shelves almost immediately, but the situation was only resolved a month later, when Woolworths promised not to keep any profits from the sale of the carriers, give Ubuntu an undisclosed payout, donate a “large portion” of the proceeds to support small business and implement intellectual property training across the company.

SOURCES: OZY

Kenyan innovators are betting on digital technologies to attract young people to an agriculture industry that currently is dominated by an aging population. With a 98 percent mobile phone penetration, the cellphone is proving to be an important source of extension services in areas where such resources are not available. As a young girl in central Kenya, Peninah Wanja witnessed firsthand the challenge of raising cattle without professional help. She came up with DigiCow, a mobile phone application that offers expert advice to farmers and allows them to keep up-to-date records on their cows. The app is an example of how technology can be used to bridge the knowledge gaps in the farming sector, while at the same time, ensuring food security. To deal with issues of illiteracy, DigiCow has a voice-based service — which Wanja says has proven helpful to the older farmer. Eighty percent of Kenya’s population is made up of small-scale farmers, according to the World Bank.

SOURCES: VOA

Rwandan science teacher Cephas Nshimyumuremyi had to start his business with six years ago, with just $10. It may sound less than promising, but Nshimyumuremyi made that initial initial investment go a long way. Today, his company Uburanga Products, which makes herbal jelly and soap from local medicinal plants, is worth $40,000 and employs more than 12 workers. His idea for natural cosmetics with healing properties came from trying to teach his students how the science they were learning in class could be applied in practical ways: “I teach chemistry so I showed my students how you can test a plant, and know the capacity of that plant to kill bacteria,” says the young entrepreneur, who launched his company in a bid to supplement his income from teaching
Don’t think that you need a lot of capital. Start with little, but use the knowledge and the environment that you already have. Nshimyumuremyi also wanted to use the local medicinal plants, used by some traditional healers, in a scientific way. He says his future goal is to provide the solution for “some skin diseases in Africa.”

SOURCES: REUTERS AFRICA

The billion-rand spaza shop or township tuckshop industry in South Africa is not a regulated sector. Most transactions at these shops are in cash, and not electronically tracked. This makes it difficult for spaza shops to be financially credited in South Africa. But there are now fintech solutions such as Zande Africa offering financial and distribution platforms, operating out of warehouses, to assist these spaza shops in their townships, by delivering daily necessities to them. The fintech company provides cash and credit service offerings to all spaza shop owners and creates relationships with them for better pricing and service.

SOURCES: FORBES AFRICA

Reginald Mengi passed away in Dubai at the age of 75. Mr Mengi, through his manufacturing, mining and media conglomerate IPP Group, owned newspapers and radio and TV stations. In 2014, Forbes estimated his wealth at $560m. He was born into a poor family close to Mount Kilimanjaro and finished his education in Scotland. President John Magufuli paid tribute to his role in the country’s development. Mr Mengi initially worked as an accountant when he returned to Tanzania, but the origins of his business empire are in a ball-point pen assembly plant. Starting in the early 1980s he turned the IPP Group into one of the largest private conglomerates in East Africa, employing more than 3,000 people, according to the company website. It owns prominent local English and Swahili TV stations, ITV and Capital TV, as well as the English-language daily Guardian newspaper. As a media mogul, Mr Mengi was accused by some, including cabinet ministers, of using his influence against them. The IPP Group also manufactures one of Tanzania’s best-known brands of bottled water and is moving into smart-phone and tablet manufacturing.

SOURCES: BBC