1“Africa is One of the World’s Viable Destinations for Investment” – Tony O. Elumelu
In an impassioned keynote speech, delivered before global leaders, at the 7th Tokyo International Conference on African Development in Yokohama, Japan, African investor and philanthropist Tony O. Elumelu, challenged the Government of Japan to invest 5% of its $50billion commitment to Africa, in empowering African entrepreneurs. “At TICAD 2016 in Kenya, Japan pledged $30billion for Africa. This year you have generously increased this to $50 billion. If we invested just 5% in Africa’s new generation of entrepreneurs, following my Foundation’s robust, proven model of getting capital directly to those best placed to catalyse growth and create real impact, we could touch 500,000 lives, across the 54 African countries, broadening markets, facilitating job creation, improving income per capita, and laying the key foundation for political and economic stability”, said Mr. Elumelu. The Tony Elumelu Foundation, in just five years has assisted over 7,500 African entrepreneurs across every African country, with seed capital, capacity building, mentorship and networking opportunities through its $100 million Entrepreneurship Programme. Mr. Elumelu’s statement captured his vision of a relationship between Japan and Africa, which prioritises economic and shared prosperity. He outlined the three key pillars of a bold and transformative structure: investment in infrastructure, partnership with the African private sector, and investment in Africa’s youth.
SOURCES: CNBC AFRICA
2Africa needs a Digitalization Strategy to Compete in the Global Economy
Siemens, in conjunction with Frost & Sullivan, have put together a comprehensive research project outlining the current state of key industries across the continent and identifying challenges and opportunities. The study, named ‘The dawn of digitalization and its impact on Africa’, considers growth predictions and where the adoption of smart technology would be most beneficial in expanding industries to drive sustainable growth. For the purpose of this study, focus was placed on four key sectors: Water, Manufacturing, Mining and Minerals, and Food and Beverage. Some of the key findings in the report are: The adoption of digital technologies, innovation as well as a range of digital customer offerings are expected to remain varied across industries, markets and geographies. Manufacturing, while the most mature in its transformation and adoption of digital technologies in Africa, remains a marginal player struggling to make a bigger impact on country GDPs. In the mining industry which has been witnessing subdued investment, rising cost pressures and increasing labour issues, a combination of mechanization, efficient extraction of resources and better use of data can make it easier for mine operators to cut costs and create a leaner and more efficient mining operation.
SOURCES: IT NEWS AFRICA
3[OPINION] Nigeria’s First Step Towards Realising the Potential of its Business Sector
The CFTA has highlighted the soft underbelly of Nigeria’s protectionist trade policy, which it has employed for decades – without much to show for it. Although the economy has made significant strides in some areas, particularly in services, the successes are few compared to the opportunities the policy has provided. The share of manufacturing as a percentage of GDP, for example, has lingered at around 10%, rising slightly to 13% in 2018. Economists say that under the right conditions, Nigeria should be able to increase this to over 40% by 2030. It is not yet clear whether the free trade agreement will help or hinder Nigeria’s ability to reach this target. In acceding to the free trade agreement, there are bound to be many positive outcomes for resilient Nigerian companies. But the country may also end up paying the price of years of relying on restrictive trade policies, rather than investing in productive capacity, to grow the economy. History shows the damage that was done to many companies across Africa during the liberalisation of African markets in the 1980s and 90s after years of surviving behind high tariff walls. Signing the free trade agreement may be painful for Nigeria for a while but it also may be the first step forward in realising the enormous potential of its business sector as a competitive force in Africa.
SOURCES: AFRICAN BUSINESS MAGAZINE
4Egypt’s Remittance Strategy Pays Off
Remittances of Egyptian expatriates rose to 42.8 per cent in May 2019. According to the Central Bank of Egypt the expatriate’s remittances rose to $3 billion in May. Remittances in April were worth about $2.1 billion. On a year-on-year basis, remittances rose by 15.3 per cent, worth $2.6 billion in April 2018. Remittances carried out through the formal banking system increased after the liberalisation of the Egyptian pound on 3 November 2016, and the dollar has the same prices both at the official and black markets. Before the decision to liberalise the pound, the dollar exchange rate difference between the official and the black market was about 100 per cent, making the black market thrive.
SOURCE: MIDDLE EAST MONITOR
5Nearly 55% Of South African Labour Force Affected By Skills Mismatch
The skills of nearly 55% of people working in South Africa are redundant or inadequate for the position they are in. Report comes as world economy seen to lose USD 5 trillion from inadequate training of workers. Human-centric skills development can boost GDP growth by up to 2%. A report published today by global management consultancy Boston Consulting Group (BCG), WorldSkills Russia and energy company Rosatom has identified new ways for governments and employers to address the growing skills crisis and boost economies. The report, Mission Talent– Mass Uniqueness: A Global Challenge for One Billion Workers, has been presented at the World Skills Conference 2019 in Kazan, as concerns increase around the world about how to address the dramatic shift in employment caused by new technologies and business models, as well as rapid and continuing urbanization. The skills mismatch already impacts over 50% of employers. By 2030, 1.4 billion workers will not have the right skills for their jobs. A third of all existing professions are expected to change by 2035 with the expansion of IT, AI and robots.
6Financial Solutions for African Problems
A package of $251 million in support of the African Development Bank’s AFAWA initiative to support women entrepreneurs in Africa has been approved at the G7 summit. The risk-sharing mechanism used by AFAWA (Affirmative Finance Action for Women in Africa) is a practical approach to international commitments. It is a direct response to the demand by women to ease access to financing, specifically on the need to establish a financing mechanism for women’s economic empowerment, adopted during a summit of African heads of state in 2015 and assigned to the African Development Bank for implementation. The Bank’s president Akinwumi Adesina applauded the “extraordinary support of all the G7 heads of state and government, which will provide incredible momentum” to the AFAWA programme. He added that currently, women operate over 40% of SMEs in Africa, but there is a financing gap of $42 billion between male and female entrepreneurs. A gap that must be closed quickly. AFAWA aims to raise up to $5 billion for African women entrepreneurs and the African Development Bank will provide $1 billion financing. The AFAWA initiative, backed by the G7 nations, is based on three fundamental principles. The first is to improve women’s access to financing through innovative and adapted financial instruments, including guarantee mechanisms to support women entrepreneurs.
SOURCE: AFRICA NEWS
7Russia Champions Nuclear for Africa’s Power Woes
Russia is attempting to gain influence in Africa and earn billions of pounds by selling developing nations nuclear technology that critics say is unsuitable and unlikely to benefit the continent’s poorest people. Representatives of Rosatom, the Russian state corporation responsible for both the military and civil use of nuclear energy, have approached the leaders of dozens of African countries in the past two years. The company, which is building a $29bn reactor for Egypt, has concluded agreements with Uganda, Rwanda, Ghana, South Africa and others. Nigeria has a deal with Rosatom for the construction of a nuclear reactor, and less ambitious agreements of cooperation have been signed with Sudan, Ethiopia and the Republic of the Congo. Rosatom is among international groups that are exporting light-water technology and is building a $13bn light-water reactor in Bangladesh. But such reactors typically generate more than 1,000 megawatts and very few countries in sub-Saharan Africa have the capacity to distribute that amount of power.
SOURCE: THE GUARDIAN
8Botswana’s Plans to Boost Economic Growth
The central bank cut its benchmark interest rate for the first time in two years, to the lowest level since at least 2007. The monetary policy committee reduced the rate by a quarter percentage point to 4.75%, the first cut since October 2017, when the central bank reduced it by 50 basis points. Officials hope the move will help the economy expand an estimated 4.2% in 2019 and 4.4% in 2020. Inflation is seen as remaining weak given subdued demand pressures in the economy. Consumer inflation was 2.9% in July, below the central bank’s 3% to 6% target range. It hasn’t breached the upper end of the band since at least 2014. Botswana imports much of its goods from neighbour SA, where inflation eased to 4% in July.
SOURCE: BUSINESS DAY LIVE
9Cleaning Up Ghana’s Banking System
Up to 70,000 people could be facing financial ruin after a massive government directive that reduced the number of lenders by a third, closed 23 savings-and-loans and triggered a run on banks which couldn’t sell their holdings fast enough to meet demand. An estimated $1.6 billion has been wiped out. That’s more than 33 percent of the assets that private fund managers supervise for retail and institutional investors, Bloomberg reported. Ghana’s main financial regulator, its Securities and Exchange Commission, has increased pressure on at least 20 fund managers suspected of violating the rules. Ghana’s SEC is blocking these money managers from accepting new investments, concerned they may use the funds to pay out existing investors. The chances are slim of the Ghanaian government bailing out burned investors, Bitcoinist reported. The central bank targeted the savings companies servicing the investors. Many are already blaming the government for not having a plan in place to prevent such financial fallout.
10Africa Needs to Invest in Teaching for Future Jobs
According to the United Nations Educational, Scientific and Cultural Organization (UNESCO), in 2016, sub-Saharan Africa had a literacy rate of 76% compared to 89% in South and West Asia, 87% in the Arab states and 98% in the developed nations. We are living in an era characterized by the fourth industrial revolution (4IR) where technologies such as artificial intelligence (AI) and blockchain are changing all aspects of our lives. Factories are automating. Because of these changes, the nature of work is changing. These changes in society because of 4IR require new sets of skills. For us to thrive in the 4IR era also requires our educational experience to be multi-disciplinary. In our limited institutions of higher learning, students enrolled for programs in the human and social sciences must also study technological subjects.
SOURCE: FORBES AFRICA