Essential The Africa the Media Doesn't Tell You About

[Yehuda]

Morocco, Most Attractive Destination for FDIs in Africa- Earnest & Young

May 4, 2017

Morocco reinforced its attractiveness for FDIs on the African continent thanks notably to its political stability and economic reforms, said the London-based multinational professional services firm, Ernst and Young (EY).

According to EY’s latest Africa Attractiveness Index (AAI), Morocco was ranked the most luring for foreign investors, followed by Kenya, South Africa, Ghana and Tanzania.

“Aided by a stable administration, even during the Arab Spring, Morocco has increasingly marketed itself as an export base for Europe, Africa and the Middle East,” said EY in its report.

Morocco’s “automotive sector has especially attracted investors’ interest, with FDI projects increasing from 5 in 2014 and 10 in 2015 to 14 in 2016,” added the report.

At the North African level, Egypt took the 11th position, while Tunisia and Algeria were ranked in the 13th and 15th position respectively by the AAI, which measures the relative investment attractiveness of 46 African economies on the basis of a balanced set of shorter and longer-term focused metrics.

The report shows that in 2016 Africa attracted 676 FDI projects, a 12.3% decline from the previous year, and FDI job creation numbers declined 13.1%. However, capital investment rose 31.9%.

The continent’s share of global FDI capital flows increased to 11.4% from 9.4% in 2015. This made Africa the second-fastest growing FDI destination by capital, said EY.

Egypt, Kenya, Morocco, Nigeria and South Africa (the key hub economies) collectively attracted 58% of the continent’s total FDI projects in 2016.

Morocco, Most Attractive Destination for FDIs in Africa- Earnest & Young

 

[Frangala]

 

[The Odum of Ala Igbo]

Duolingo added Swahili

And they will add Zulu

I hope they add Igbo, Hausa and Yoruba. The Naija trifecta!

 

[Yehuda]

Senegal creates digital currency history

• AFRICAN BUSINESS MAGAZINE
• 22 MAY 2017

The IMF believes that the economy of the West African Economic and Monetary Union (WAEMU), which covers most of Francophone West Africa, remains strong but exhibits increased vulnerabilities. Senegal is embarking on an interesting experiment that could either provide big opportunities or great competition for the nation’s banks.

In December, it became only the second country in the world, after Tunisia, to launch a national digital currency. It will have the same value as the CFA franc and can be stored in all mobile money and e-money wallets. Given current optimism over the country’s economic prospects, these are exciting times for Senegal and Senegalese banking.

Very quietly and with little fuss, Senegal has joined the ranks of Africa’s fast growing economies, alongside Kenya, Tanzania and Côte d’Ivoire. GDP increased by 6.5% in 2016, the fastest rate for 11 years, and the IMF forecasts annual growth of 7% for this year and next.

The government is currently revising the basis on which it calculates its GDP. It previously used 1999 as its baseline but Finance Minister Amadou Ba expects a 30% increase in the size of the economy when the process is completed.

Above all else, Dakar has achieved what few other governments can lay claim to: it has actually done what it said it was going to. The government has slowly reduced its fiscal deficit from 5.5% in 2013 to 4.2% in 2016 and is on track to reach 3% by 2019, which is the medium-term target for the WAEMU. It has also managed to reach its budget targets.

Senegal has the prospect of becoming a significant oil and gas producer in the near future. Kosmos Energy has discovered the Tortue Field with an estimated 15 trillion cu ft of natural gas at present but up to 50 trillion cu ft has been suggested.

This would be sufficient to fuel a huge liquefied natural gas (LNG) plant and provide as much gas as onshore power, fertiliser and cement plants could consume. BP has bought a stake in Kosmos’ Senegalese blocks and so the required investment should now be forthcoming. In addition, Scottish oil company Cairn has already discovered offshore oil reserves.

However, the government must be careful not to replicate Ghana’s recent development. The Ghanaian economy was already growing strongly when hydrocarbons were discovered, apparently putting the icing on what was an already attractive cake.

However, Accra seemed to get ahead of itself in terms of increasing spending too quickly, fuelling both inflation and debt. On 13th April, credit ratings agency Moody’s lifted Senegal’s long-term issuer and senior unsecured debt rating from B1 to Ba and changed the outlook to stable from positive.

World’s second national e-currency

It is against this backdrop that Senegal has followed in the footsteps of Tunisia by launching a new national digital currency. Based on blockchain, the same technology behind bitcoin, the crypto currency has been given the stopgap name eCFA. The new currency will be compatible with other digital cash systems in Africa.

It has been developed by a Senegalese bank, Banque Régionale de Marchés (BRM), and eCurrency Mint. In a statement, the two partners said: “The eCFA is a high-security digital instrument that can be held in all mobile money and e-money wallets. It will secure universal liquidity, enable interoperability, and provide transparency to the entire digital ecosystem in WAEMU.”

In terms of security, the developers say that the currency will be secured by cryptographic protocols to ensure that it cannot be counterfeited. Proponents also argue that such currencies are more transparent and easily regulated by central banks.

To some extent, the eCFA is not as revolutionary as some would believe because of its dependence on the central banking system. The electronic money provided by BRM can only be issued by an authorised financial institution.

Other governments and central banks are contemplating launching their own digital currencies. For instance, the People’s Bank of China plans to issue its own currency based on blockchain.

Why Senegal?

There appear to be two main reasons why Senegal was open to the idea. Firstly, the country is already in an unusual position with regards to its currency. Its CFA franc is shared by 14 countries in West and Central Africa, with its value guaranteed by the French government.

It is therefore used to seeing its currency in a different light to many other countries. The region is also more open to the concept, as the Central Bank of West African States (BCEAO), which serves the countries using the CFA franc, has already drawn up its own e-currency regulations.

Secondly, the concept of technological leapfrogging has become more common in recent years, with proponents arguing that the continent could catch up in developmental terms by bypassing stages of technological development in favour of the latest advances. Dakar and Tunis are therefore open to the idea of alternative, parallel currencies, daring to take the lead on launching them.

The experiment could fail but could also prove revolutionary in a region where most people still lack formal bank accounts. This factor could make the currency more acceptable to potential users than in other parts of the world, as more people use airtime than have traditional bank accounts.

The BCEAO will be responsible for the currency’s distribution in the rest of the region in Phase 2. It is to be distributed in Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger and Togo.

Alioune Camara, the chief executive of BRM, said: “We are committed to bringing digital financial services and true financial inclusion to West Africa. We can now facilitate full interoperability between all e-money payment systems. This is a great leap forward for Africa.”

These are exciting times for Senegalese banking in general. Despite the rise of alternative currencies and methods of accessing bank services, the number of physical bank branches has increased rapidly, from 448 at the start of 2014 to 557 at the start of 2016. There are currently 20 banks in the country, including Banque de l’Habitat du Senegal, Islamic Bank of Senegal and Banque Atlantique.

Senegal creates digital currency history

 

[Yehuda]

Nova Power to build 25 MW solar plant in Ivory Coast

MAY 26, 2017 | EMILIANO BELLINI

The Moroccan developer will construct the plant as an Independent Power Producer (IPP). The facility will be located in the north of the country.

Denis Carrascosa

Morocco-based developer Nova Power will build a 25 MW PV plant in Benguébougou, Korhogo Department, in the north of Ivory Coast.

According to a document from the local government, the plant will be built thanks to a private investment of 23,000 million XOF (around $40 million). This is considerable less that the original investment, previously announced by the country’s Ministry of Energy, which was of 44,000 million XOF.

The plant will be built by Korhogo Solaire, a subsidiary of Nova Power, and it is scheduled for completion by the end of 2018. The plant will sell power to local utility Compagnie Ivoirienne d’Electricité (CIE). In the EoI for the project issued last year, the Ministry of Energy said the maximum price at which the facility had to deliver power was 70 XOF ($0.12)/kWh.

The concession contract for the project was signed by the ministry and Nova Power in November 2016. The plant will be the country’s first large-scale solar power facility.

The government of Ivory Cost aims at installing 150 MW of generation capacity by 2020. This new capacity is expected to be deployed mostly by IPPs. Currently, the West African country has an installed capacity of 1.77 GW, which makes it an exporter of power to neighboring countries such as Burkina Faso, Ghana, Guinea, Liberia, and Sierra Leone. Only 26% of its population, however, has access to electricity.

The United Nations Industrial Development Organization (UNIDO) is promoting renewable energy-based grids in rural communities for productive uses together with the French Development Bank, the West African Development Bank, and CIE.

Nova Power to build 25 MW solar plant in Ivory Coast

 

[The Odum of Ala Igbo]

50 years on: Nigeria's Biafra secessionist movement

50 years on: Nigeria's Biafra secessionist movement
On Biafra Remembrance Day we ask pro-secessionist leader Nnamdi Kanu if the call for secession is growing louder.

• 
• 

• 
  by
  Chika Oduah
  
  
  
  
  
  Umuahia, Nigeria - Nnamdi Kanu waves his hand and puffs in frustration: "Nothing seems to be working in Nigeria. There is pain and hardship everywhere. What we're fighting [for] is not self-determination for the sake of it. It's because Nigeria is not functioning and can never function."
  
  The leader of a group demanding the secession of southeastern Nigeria is speaking exclusively to Al Jazeera in the parlour of his father's home in the southeastern city of Umuahia.
  
  It's the first time he has spoken to an international media outlet since he was granted bail on health grounds last month. His bail conditions prohibit him from being in a crowd of more than 10 people, leaving the country and giving media interviews.
  
  But when asked if he is worried that he will get in trouble with the Nigerian authorities for speaking to Al Jazeera he scoffs, "I don't care," and rolls his eyes.
  
  "I can't go outside to call for a press conference. I can't go on Biafra Radio to broadcast. I can't allow large [groups of] people to basically congregate outside to see me … it's like asking me not to breathe," he says.
  
  On the other side of the parlour door, dozens of people are waiting to see Kanu. A throng of young men dressed in black guard the compound. They refer to Kanu as, "our supreme leader" or "his royal highness".
  
  Kanu left Nigeria to study economics and politics at the London Metropolitan University and started Radio Biafra, an obscure, niche, London-based radio station in 2009.
  
  In one broadcast, Kanu said: "We have one thing in common, all of us that believe in Biafra, one thing we have in common, a pathological hatred for Nigeria. I cannot begin to put into words how much I hate Nigeria."
  
  Over the past two years, Kanu's status has risen.
  
  Today, he's a highly visible activist and leader of the Indigenous People of Biafra (IPOB) organisation, and after being imprisoned in the Nigerian capital of Abuja for nearly two years on treasonable felony charges, he has now returned home.
  
  "Kanu is my saviour," says Sopuru Amah, a senior student at one of Nigeria's oldest universities, the University of Nigeria in the southeastern city of Nsukka.
  
  "Just like Jesus was sent to save the world, Kanu was sent by God himself to save the Igbo people."

 

[The Odum of Ala Igbo]

 

[BigMan]

Kenya inaugurates new Chinese-funded railway

NEWSKENYA20 HOURS AGO
Kenya inaugurates new Chinese-funded railway
The country's biggest infrastructure project since its independence is under fire by some for its high costs.




Amid concerns of its high price tag, Kenyan President Uhuru Kenyatta has inaugurated a Chinese-built railway, the country's biggest infrastructure project since its independence.

The red-and-white diesel train left from the port city of Mombasa on Wednesday on its journey to Nairobi, carrying Kenyatta, Chinese dignitaries and citizens from around the country.

"Today we celebrate one of the key cornerstones to Kenya's transformation to an industrialised, prosperous, middle-income country," Kenyatta said at the inauguration ceremony.

The five-hour journey on what is being called the Madarake Express, or "Freedom Express", will take half the time it takes to drive between the two cities.

READ MORE: Kenya launches mega railway project

Al Jazeera's Catherine Soi, reporting from Mombasa, said many see the train as a "historic" moment for Kenya.

"This is a huge milestone and everyone who has witnessed the inaugural ceremonies are very proud, saying it's an historic event," Soi said.

The new railway will replace what was dubbed the "Lunatic Express", the railway built more than a century ago by colonial Britain - known for its lengthy delays and breakdowns, as well as its high costs.

"The difference between this railway and the old one is affordability and the capacity of the trains to carry more load and passengers, as well as its speed," Soi said.

Wagari Ngunyi, a passenger of the new train, told Al Jazeera that it "is comfortable and it's very smooth".

The new railway replaces a colonial-era line that was dubbed the "Lunatic Express" [Tony Karumba/AFP]
$3.2bn price tag
Al Jazeera's Soi said that the while "efficiency of the train is not in dispute, many people are worried about the economics of its construction".

Accusations of corruption, concerns over the impact on wildlife, and a $3.2bn price tag blamed on poor negotiations with the Chinese have dogged the project.

Economist Kwame Owino told Al Jazeera that "Kenya's railway costs [per kilometre] are almost 40 to 50 percent higher" than some of Kenya's neighbouring countries.

"It's an extremely expensive piece of railway, especially because the technology is more up to date," Owino said.

READ MORE: Africa is not poor, we are stealing its wealth

Transport Minister James Macharia said, however, that the government expects the railway to boost GDP by 1.5 percent, allowing them to pay back its loan from the Chinese "in about four years".

Joseph Keiyah, of Kenya's Institute for Public Policy Research and Analysis, told Al Jazeera that while the project is expensive, it has many benefits for the country.

"I think what Kenya is trying to do in a nutshell is to reposition itself as the strategic gateway to East Africa."

The railway is part of a "master plan" by East African leaders to connect their nations by rail, with the Standard Gauge Railway (SGR) planned to eventually link Uganda, Rwanda, South Sudan, Burundiand Ethiopia.

Conservationists have expressed concern over the railway's impact on wildlife [Tony Karumba/AFP]
Al Jazeera's Soi said another concern regarding the railway is the growing Chinese influence in the country.

"The Chinese government seems to be calling the shots, and that is concerning many people," Soi said.

China's Export-Import Bank financed 90 percent of the railway's first leg, while the Kenyan government provided the remaining 10 percent.

 

[BigMan]

 

[The Odum of Ala Igbo]

What do they gain out of joining OPEC? Isn't their output now subjected to limitations?

 

[BigMan]

What do they gain out of joining OPEC? Isn't their output now subjected to limitations?

Saudi /UAE investment ?

increased international profile ?

Idk

 

[The Odum of Ala Igbo]

Saudi /UAE investment ?

increased international profile ?

Idk

Don't trust these Gulf folks

Probably increases their int'l profile.

 

[Poitier]

Damn ass shots done made their way to Africa like that? The lengths Zim women will go for a beautiful ass | TRUE Africa

 

[Yehuda]

Southern Africa has an integration plan: but it’s short of sector specifics

June 7, 2017 11.29am EDT | Pamela Mondliwa

The southern African region can benefit from beneficiating produce like sugar. REUTERS/Mujahid Safodien

The Southern African Development Community (SADC) has placed industrialisation at the centre of its regional integrated development plan and a roadmap has been drawn up to guide the plan. But implementation has been poor and not a lot of headway has been made to integrate the economies of the region.

Recent studies on value chains in the region highlight high transport costs and continued use of non-tariff barriers in some countries as some of the main reasons for poor progress.

These studies suggest that the region needs a coherent sector-specific approach to support the development of regional value chains. That should be supported by efforts to reduce trade barriers. In addition, the impact on industrialisation that large multinationals have had should be considered.

The idea of a roadmap was a wise move but more is needed to give it practical focus. We assessed the extent to which it takes into account the findings of various studies and whether it incorporates plans to overcome the identified challenges. Although the strategy has identified key sectors to lead the process, it fails to set out what should happen in specific sectors to support regional linkages. It's also blind to the role of large multinationals which are distorting regional markets.

Beneficiation is the key

The industrialisation strategy stresses the urgent need for the region to make use of its abundant and diverse resources – particularly in agriculture and mining. It’s key aim is to foster industrialisation through beneficiation – a process of transforming primary raw materials into a more value added finished product – and value addition.

This approach is informed by two big challenges related to trade. First, is that intra-regional trade is low. In 2014 intra-SADC trade was 19% of total trade, compared with 70% in Asia-Pacific Economic Cooperation (APEC) and 64% in the European Union.

Compounding this is the fact that trade between countries is dominated by low value products from the agricultural and mineral sectors. Most have been through none, or very little processing. This means that a lot of value added products, which can be produced in the region, mineral fuel, are imported.

There are plenty of opportunities to improve the situation. For example, South Africa and Zambia are large net exporters of sugar. Yet, both – as well as others in the region – import most confectionery products, a substantial category of processed food. Products like biscuits, sweets and beverages could add enormous value if they could be produced within the region.

But only a regional approach to promoting value addition will work. It must focus on building productive capacity of industries, developing infrastructure and promoting technology.

Supply isn’t keeping up with demand

The agro processing sector is given a prime spot in SADC’s industrialisation strategy. This makes sense because food processing has characterised the early industrialisation stages of many emerging economies.

It also makes sense because rapid urbanisation is driving increased demand for processed food. Africa’s urban population nearly doubled from 1995 to 2015 and the trend is expected to continue. This has driven up demand for processed foods and confectionery products. But supply isn’t meeting demand. This can be seen from the fact that the region has trade deficits in processed food in sectors like poultry and sugar confectionery products.

For the strategy to work, constraints such as development financing, transport and poor border logistics need to be addressed.

Reducing transport costs and border delays have been identified as one of the biggest impediments to developing regional value chains. Transport costs are so high that it’s cheaper to import animal feed and sugar from South America than from the region. It’s been estimated that lower transport costs improve the cost competitiveness of regional producers by 10%.

Lacking detail

The region has done well on the big picture (macroeconomic, infrastructure and investment) policies. But there’s been little attention to identifying specific value chains within the agro processing and mineral beneficiation sectors.

The strategy entrenches this problem. Although it points to the need for national industrial policy coordination, it doesn’t address some of the challenges facing specific regional value chains. Non-tariff barriers are an obvious one. Some examples include Botswana banning chicken imports and its requirement that at least 30% of local maize and soya must be sourced locally first. Measures such as these have hampered a regional poultry value chain developing.

When it comes to confectionery, recent research shows how the sugar-to-confectionery value chain has been affected by Zambia’s ban on sugar imports from neighbouring countries which has led to high prices of sugar in the domestic market.

Removing barriers would also lead to better outcomes for the region because some countries produce very little of some produce, while being abundant in others. For example, Botswana doesn’t produce enough maize and soya, while Zambia produces a lot.

Policy coherence and coordination at the sector level is needed to remove these barriers.

Greater attention also needs to be given to the role of large firms, particularity multinationals. For example, the sugar industry is dominated by Illovo and Tongaat-Hulett. Because of their dominance they can unilaterally set prices. This has led to higher domestic prices compared with international prices.

The domination by large firms can be addressed by ensuring competition between players in the region. This would require co-ordination between competition authorities to address any potential cross border cartels.

In addition, industrial policies would need to be structured in a way that supports the development of regional value chains for mutual benefit of different countries.

It’s clear that SADC’s industrial development strategy has gaps. Among these are concrete action plans for specific sectors and the need for collective action by different member countries. Given that it’s relatively more industrialised, South Africa has a key role to play. But it must just guard against acting like a big brother.

Tatenda Zengeni and Maria Nkhonjera who are researchers at the Centre for Competition, Regulation and Economic Development contributed to this article.

Southern Africa has an integration plan: but it's short of sector specifics

 

[The Odum of Ala Igbo]

Southern Africa has an integration plan: but it’s short of sector specifics

June 7, 2017 11.29am EDT | Pamela Mondliwa

The southern African region can benefit from beneficiating produce like sugar. REUTERS/Mujahid Safodien

The Southern African Development Community (SADC) has placed industrialisation at the centre of its regional integrated development plan and a roadmap has been drawn up to guide the plan. But implementation has been poor and not a lot of headway has been made to integrate the economies of the region.

Recent studies on value chains in the region highlight high transport costs and continued use of non-tariff barriers in some countries as some of the main reasons for poor progress.

These studies suggest that the region needs a coherent sector-specific approach to support the development of regional value chains. That should be supported by efforts to reduce trade barriers. In addition, the impact on industrialisation that large multinationals have had should be considered.

The idea of a roadmap was a wise move but more is needed to give it practical focus. We assessed the extent to which it takes into account the findings of various studies and whether it incorporates plans to overcome the identified challenges. Although the strategy has identified key sectors to lead the process, it fails to set out what should happen in specific sectors to support regional linkages. It's also blind to the role of large multinationals which are distorting regional markets.

Beneficiation is the key

The industrialisation strategy stresses the urgent need for the region to make use of its abundant and diverse resources – particularly in agriculture and mining. It’s key aim is to foster industrialisation through beneficiation – a process of transforming primary raw materials into a more value added finished product – and value addition.

This approach is informed by two big challenges related to trade. First, is that intra-regional trade is low. In 2014 intra-SADC trade was 19% of total trade, compared with 70% in Asia-Pacific Economic Cooperation (APEC) and 64% in the European Union.

Compounding this is the fact that trade between countries is dominated by low value products from the agricultural and mineral sectors. Most have been through none, or very little processing. This means that a lot of value added products, which can be produced in the region, mineral fuel, are imported.

There are plenty of opportunities to improve the situation. For example, South Africa and Zambia are large net exporters of sugar. Yet, both – as well as others in the region – import most confectionery products, a substantial category of processed food. Products like biscuits, sweets and beverages could add enormous value if they could be produced within the region.

But only a regional approach to promoting value addition will work. It must focus on building productive capacity of industries, developing infrastructure and promoting technology.

Supply isn’t keeping up with demand

The agro processing sector is given a prime spot in SADC’s industrialisation strategy. This makes sense because food processing has characterised the early industrialisation stages of many emerging economies.

It also makes sense because rapid urbanisation is driving increased demand for processed food. Africa’s urban population nearly doubled from 1995 to 2015 and the trend is expected to continue. This has driven up demand for processed foods and confectionery products. But supply isn’t meeting demand. This can be seen from the fact that the region has trade deficits in processed food in sectors like poultry and sugar confectionery products.

For the strategy to work, constraints such as development financing, transport and poor border logistics need to be addressed.

Reducing transport costs and border delays have been identified as one of the biggest impediments to developing regional value chains. Transport costs are so high that it’s cheaper to import animal feed and sugar from South America than from the region. It’s been estimated that lower transport costs improve the cost competitiveness of regional producers by 10%.

Lacking detail

The region has done well on the big picture (macroeconomic, infrastructure and investment) policies. But there’s been little attention to identifying specific value chains within the agro processing and mineral beneficiation sectors.

The strategy entrenches this problem. Although it points to the need for national industrial policy coordination, it doesn’t address some of the challenges facing specific regional value chains. Non-tariff barriers are an obvious one. Some examples include Botswana banning chicken imports and its requirement that at least 30% of local maize and soya must be sourced locally first. Measures such as these have hampered a regional poultry value chain developing.

When it comes to confectionery, recent research shows how the sugar-to-confectionery value chain has been affected by Zambia’s ban on sugar imports from neighbouring countries which has led to high prices of sugar in the domestic market.

Removing barriers would also lead to better outcomes for the region because some countries produce very little of some produce, while being abundant in others. For example, Botswana doesn’t produce enough maize and soya, while Zambia produces a lot.

Policy coherence and coordination at the sector level is needed to remove these barriers.

Greater attention also needs to be given to the role of large firms, particularity multinationals. For example, the sugar industry is dominated by Illovo and Tongaat-Hulett. Because of their dominance they can unilaterally set prices. This has led to higher domestic prices compared with international prices.

The domination by large firms can be addressed by ensuring competition between players in the region. This would require co-ordination between competition authorities to address any potential cross border cartels.

In addition, industrial policies would need to be structured in a way that supports the development of regional value chains for mutual benefit of different countries.

It’s clear that SADC’s industrial development strategy has gaps. Among these are concrete action plans for specific sectors and the need for collective action by different member countries. Given that it’s relatively more industrialised, South Africa has a key role to play. But it must just guard against acting like a big brother.

Tatenda Zengeni and Maria Nkhonjera who are researchers at the Centre for Competition, Regulation and Economic Development contributed to this article.

Southern Africa has an integration plan: but it's short of sector specifics

- Lots of interesting subject matter in the thread. Southern Africa should really look into economic integration. It would be a beautiful thing to see.

However, I do understand that existing industrialization strategies clash. South Africa, for instance, merked Botswana's attempt to start a car assembly sector.