Africa Top10 Business News

1Female Entrepreneurship in Sub-Saharan Africa

SheMeansBusiness

In an increasingly interconnected world, the rise in technology-based businesses is playing a crucial role in narrowing the gender gap and pushing female entrepreneurship forward. As national economies face stiff competition for specialist market skills and resources, a number of startups are drawing international interest. There are also a number of global initiatives supporting and propelling female-run businesses on the continent. Speaking at SheMeansBusiness, an initiative designed to empower female entrepreneurs across Nigeria, Facebook’s policy programmes head in Africa, Sherry Dzinoreva, said that the company would be intensifying its female entrepreneurship training. But despite the launch of such initiatives there are still a number of challenges women need to overcome. Across Africa, women are prevented from pursuing a career in business through overt and hidden discriminatory practices. In sub-Saharan Africa, at least 40% of the labour force is female, according to the Pew Research Centre. However, 74% of women’s non-agricultural employment is informal, in contrast with 61% for men. In the private sector, African women hold 23% of positions at executive committee level and just 5% of CEO-level jobs, according to McKinsey. Access to capital and exclusion from male dominated business networks constrain women’s participation in business.

SOURCES: AFRICAN BUSINESS MAGAZINE

2Some of the Biggest Challenges Facing Jumia

Jumia

Like its rivals in many developing countries, Jumia offers payment on delivery “as a marketing tactic” since customers are worried about being scammed and are uncomfortable sharing their information online. To attract as many customers as possible, Jumia also has a travel website, an event and movie ticket business, a food delivery service and a payments system that gives users access to microloans. Jumia has spent a lot of money in its aggressive drive to gain market share, logging roughly $1 billion in losses, including $195.2 million on revenue of $149.6 million last year. Poignonnec says Jumia is focused on driving down costs while gaining users, but that the hundreds of millions of dollars it has invested over the past seven years has given it the scale to be the only Pan-African e-commerce player — even as rivals have withered. Last year, Jumia’s Nigerian rival Konga, which is backed by Naspers, was sold to Zinox, a data center and computer firm, after cutting roughly 60 percent of its staff. A number of other e-commerce sites have downsized, shut down or pivoted into other businesses. Being Pan-African has also helped Jumia sign partnerships with companies like Pernod Ricard, Mastercard and Xiaomi, the Chinese mobile phone maker, which would prefer to sign one big deal rather than individual country-level deals, the executives say. The the diversity of its markets allowed Jumia to use smaller countries such as Ghana or Ivory Coast as labs for projects they might roll out in bigger markets like Nigeria and Egypt — or, in the case of JumiaPay, which debuted in those two large markets in 2017, vice versa.
 
SOURCES: OZY

3More African Firms are Leveraging Influencers as part of their Marketing Strategy

African Firms

Social and digital media have given room for new ways businesses can engage and sell to their customers. Increasingly gaining traction in South Africa is influencer marketing, an entirely new branch of the sales and marketing funnel which has seen brands leverage popular personalities on social media to promote their products and services online. Globally, the influencer marketing industry is forecast to be worth $5 billion to $10 billion by 2020, according to a study by Mediakix.  In the digital universe, content is king. Authenticity is paramount. A study conducted by the Mobile Marketing Association reported that most consumers have banner blindness and suffer from advertising fatigue. They cannot recall the last digital banner ad that they saw. Ad-blocking continues to be a growing phenomenon, further demonstrating the shift in consumer behavior. Consumers simply don’t want to be marketed to. To this effect, influencers assist brands to reach their customers through content that is more relevant to those consumers.Brands and agencies measure awareness and engagement by analyzing a few parameters, including, inter alia, number of likes, comments, shares and followers. Proponents of this theory believe an increase in these parameters lead to brand success.

SOURCES: FORBES AFRICA

410 Best African Countries for Doing Business 2019

Business index

The Doing Business index is a ranking index system, created by the World Bank Group, which indicates the regularity environment of businesses. A higher ranking, which is indicated by a lower numerical value, specifies a stronger protection of property rights, and vice versa. Over 190 economies have been scrutinized on criteria including: electrification and ease of business creation, the tax burden and the protection of property rights. Mauritius is positioned in 20th place worldwide, and in 1st place in Africa with a score of 79.58. The country is ranked twentieth place higher this year, from its position in the 2018. Rwanda emerged in the top 30 countries of the World Bank’s Doing Business report for the first time with a score of 77.88. Globally, Rwanda is 29st on the “ease of doing business” ranking, compared to the 41th position in last year’s report. In addition, the country has made 52 reforms over the last decade, bringing significant improvements to the environments of business and investment. Morocco came in 3rd in Africa and in 60th position with a score of 71.02 points. Therefore, Morocco confirms its position as a leader in North Africa, ahead of: Tunisia (80th), Egypt (120th), and Algeria (157th). Kenya came in 4th among African countries and 61st position globally with a score of 70.31 points compared to the 2018 report when it was ranked 80th.

SOURCES: AFRICA.COM

5Plastic Bag Bans are Working and are Especially Effective in African Nations

Plastic Bag Bans

As of June 1, travelers to Tanzania will have to pack very carefully. The country announced the implementation of the second phase of its plastic bag ban on May 16. Visitors are advised to avoid packing or carrying any plastic bags as they’ll have to leave these at a designated desk in the airport. The first phase of the country’s anti-plastic initiative began in 2017 to “protect the youth and environment,” with an initial ban on the manufacture of plastic bags and in-country distribution. Phase two extends to tourists. There are exceptions to the new rule for medical, industrial, construction, agricultural, and waste management packaging, as well as for the small “ziploc” bags used to carry toiletries (as long as these leave the country when the visitors do). Still, Tanzania aims to be plastic bag free, and it’s just one of 34 African nations fighting against single-use plastics with such bans. In fact, the African continent is leading the world in plastic bag regulations. Notably, 31 of these bans have been passed in sub-Saharan Africa. In Kenya, the penalties for ignoring the ban are the world’s most punitive. Manufacturers, importers, distributors, and users found with plastic bags face up to $38,000 in fines or four years in prison. The ban has faced resistance, and enforcement is also a problem—it’s spotty, which means that plastic bags are still circulating despite the potential penalties. Still, in a country that once used about 100 million plastic bags a year, according to UN estimates, the reduction efforts are notable and seem to be effective. Rwanda is aiming to be the world’s first plastic-free country, and its prohibitions appear to be working. The UN named the country’s capital, Kigali, the African continent’s cleanest city, thanks in part to a 2008 ban on non-biodegradable plastic.

SOURCES: QUARTZ AFRICA

6Making Nigeria’s Movie Scene a Contributor to the Economy

Nigeria’s Movie Scene

Top producers, filmmakers, and executives from Nigeria’s film industry travelled to France for the Cannes Film Festival’s first “Pavillon Afriques,” a series of sessions and screenings highlighting the opportunities and challenges facing filmmakers from across the continent. Their goal: raising visibility for Nollywood and participating in discussions about financing, dealmaking, and the expansion of distribution. Nollywood, the nickname for Nigeria’s robust film industry, has long been hamstrung by piracy. For years filmmakers have watched with frustration as swarms of illegitimate DVDs quickly overwhelmed their promising cinematic efforts, slashing potential profits and making it difficult to raise money to produce future films. But in the spring of 2019 the makers of Chief Daddy managed to cash in on a new window of opportunity, this time online. EbonyLife sold the movie’s global streaming rights to Netflix Inc., for an undisclosed sum. In March the streaming service made the movie available to 149 million customers in 190 countries, most of whom live well beyond the reach of those pirated DVDs. That’s welcome news to the Nollywood community, which since its inception in the 1990s has emerged as a promising source of growth within the Nigerian economy. According to a 2017 report by PricewaterhouseCoopers LLP, Nollywood is the second-largest producer of films in the world, trailing only India’s Bollywood. Nigeria’s arts, entertainment, and recreation sector, of which Nollywood is a significant part, generated 239 billion naira ($664 million) in 2016 and is projected to continue growing.

SOURCES: BLOOMBERG

7People Wait for Zimbabwe’s Mega Deals to Materialise

Zimbabwe’s Mega Deals

Together with the enthusiastic support of state media, Mnangagwa and his officials have announced more than $27bn of planned investment ranging from new platinum mines to steel mills and hydropower dams. Medicines, fuel and foreign currency are in short supply, prices of basic goods such as bread are surging and the International Monetary Fund has forecast the first economic contraction in 11 years. And many of the investment projects announced by the government haven’t progressed beyond the memorandum of understanding or feasibility stage. Few companies with a “rational level of risk appetite” will invest in the country in its current state, said Jee-A van der Linde, an economist at NKC African Economics. The African Development Bank estimated foreign direct investment last year at $470 million, about a third of the $1.1 billion attracted by northern neighbor Zambia and a fraction of the $2.3 billion that flowed into Mozambique, which lies to the east. For some Zimbabweans, the investment pledges evoke memories of Mugabe, who was prone to announcing mega-deals that didn’t materialize. For example, in September 2017 Mugabe announced plans to revive Zimbabwe Iron & Steel Works Ltd., once the second-largest steelmaker in sub-Saharan Africa. The project never got off the ground.

SOURCES: AL JAZEERA

8Going Down for Mozambique Maritime Scandal

ex-Credit Suisse Group AG banker

An ex-Credit Suisse Group AG banker became the first person to plead guilty in what U.S. prosecutors called a $2 billion fraud and money-laundering scam tied to loans to Mozambique that were used to pay bribes and kickbacks. Detelina Subeva, 37, a former vice president in the bank’s global financing unit, pleaded guilty on Monday to one count of conspiracy to launder funds. The U.S. agreed to drop three other conspiracy charges against Subeva, who’s one of three Credit Suisse bankers accused of working with Mozambique’s ex-finance minister in a secret kickback scheme. The case centers on deals that allowed Mozambique to borrow $2 billion for maritime projects and coastline protection in 2013. The bonds sold to finance the loans were marketed to international investors to aid the economy and thwart sea piracy, but prosecutors say at least $200 million were plundered in the form of bribes and kickbacks.

SOURCES: BLOOMBERG

9Ethiopia’s Cash Cow Programme

Ethiopian Farmers

Farmers in Ethiopia have joined a program that helps them borrow money to purchase a dairy cow and get it insured. The milk would bring in much-needed income – as much as $10.45 a day. As climate change tests the livelihoods of crop farmers and herders, the innovative scheme aims to foster a culture of saving and micro-insurance – but not all has gone smoothly. Run by UK-based nonprofit Farm Africa, the project organizes farmers into savings groups and links them with micro-finance companies that give them loans to buy cows for extra income. They then sign up to insurance policies to ensure they can still repay their loans if their cows die. But some farmers complain such market-driven initiatives leave participants waiting too long for the money to come in. According to Farm Africa, since the project launched in 2015, it has established more than 340 village savings and loans associations, through which households have put away more than $100,000 and farmers have accessed nearly $70,000 in loans. Addis Ababa-based Nyala Insurance S.C., which provides the livestock cover, said payouts to a few farmers had been delayed. That was mainly because of the technology Nyala agents use to record and submit claims while in the field, said Solomon Zegeye, micro-insurance business manager at the company.

SOURCES: REUTERS AFRICA

10Rwandan Genocide Survivor Starts Empowerment Programme

Rwandan Genocide Survivor

Safi Mukundwa knows what it means to be young, fearful and desperate. She was just 8 years old when she hid among bloodied bodies, emerging as the only one in her family to survive the 1994 genocide that swept through Rwanda. She remembers the man who killed her mother and brother. “I told God that if I can get out of this place alive, I will dedicate my life to helping others,” she says. Now 33, Mukundwa has made good on that commitment through Safi Life, the nonprofit organization that she inspired. Its mission is to educate, empower and advance young Rwandan women. Safi Life was formally launched in 2012, growing out of a friendship between its namesake and Devon Ogden. Both women were college students when Ogden, an American from California, visited Rwanda in the summer of 2007 and heard Mukundwa’s testimony at the Kigali Genocide Memorial. They met over lunch, and Ogden eventually asked how she might help the young Rwandan. The foundation’s Facebook page brims with photos of college graduates. In early 2018, Safi Life launched an outreach project to aid young women, especially those who are single and pregnant or with young children. It opened a center in the Kigali suburb of Karembure, welcoming dozens to learn knitting, tailoring and other income-producing skills. The project, called Ndashoboye, a Kinyarwanda word that means “I am capable,” also provides mentoring on how to run a business. A second center opened in January in Ndera, a few kilometers from the capital city’s downtown.

SOURCES: VOA

ADC Editor
ADC editors curate, aggregate, and produce news and information for Africa. Contribute stories by sending an email to media@africa.com.