Page 1









Fuels & Lubricants (Castrol Lubricants) Filters, Pumps, Heavy Duty & Industrial Spares

Shulnam: Danatrac:

Gas Station & Convenient store. Agro Equipment and Machinery

Terotech Cons: Serenity Lodge:

Block Manufacturing and Construction Accommodation & Catering

Dana Transport:

Logistics and Clearing




T: +260 211 238 359 | +260 211 222 457 F: 211 225 771 | E: info@danagroup.co.zm P.O.Box 36722 Plot No.17107, Chandwe Musonda Rd, Lusaka, Zambia

Peter Ngozi-Nyirongo Managing Editor and Publisher +27 73 965 1943 peter@africaglobalgateway.com

Chris Mutale Contributing Editor

Phathu Luvhengo Contributor

Nikki Temkin Contributor

Thelma Ngoma Contributor

Sinethemba Zonke Contributor / Politics and Economics

TEAM Management Editor: Peter Ngozi-Nyirongo Editorial Contributor: Chris Mutale Creative Direction Peter Ngozi-Nyirongo and Bryan Maron / Design Bandits Design and Layout: Bryan Maron / Design Bandits Inspiration and Creative Motivation: Paul Martin Sales and Marketing: Luke Garcia Distribution: Nathan Zachary – The Americas Region Joseph Myers – Middle East Regions and Asia Pacific Printer: Jetline Media Managing Publisher: Peter Ngozi-Nyirongo; and Priority Digital Media, 20th Floor, 14 Wall Street, New York, New York City, United States of America 2nd Floor Webber Wentzel Building, 90 Rivonia Road Sandton, Johannesburg, South Africa Disclaimer: The opinions expressed in this publication are those of the author(s) and do not reflect the opinions of Africa Global Gateway or its Editors. Contact us: connect@africaglobalgateway.com | www.africaglobalgateway.com Information contained in our published works have been obtained by Africa Global Gateway from sources believed to be reliable. However, neither Africa Global Gateway or its authors guarantees the accuracy or completeness of any information published herein; and neither Africa Global Gateway nor its authors shall be responsible for any errors, omissions, or claims for damages, including exemplary damages, arising out of use, inability to use, or with regard to the accuracy or sufficiency of the information contained in the Gauteng Gateway publication.

@AfricaGlobalMag 2 | africa global gateway


Africa Global Gateway


editor’s note


rowing up in Africa, I realized at an early stage the vastness of the wealth that lies at our disposal and to a large extent remains untapped or underutilized. I was always fascinated by how rich and full of gems the continent was, and continues to be, and the possibility that it can turn its fortunes around and benefit all who live on it. As a young entrepreneur with a wild ambition to make it on the continent I began to ply my trade in two things I have always been passionate about – media and real estate. Along the way I have hit some bumps and got some bruises. Its all part of the journey my mentor used to say. I have always learnt not to stay down too long, rethink, re-position, and get up again. In many ways I see my personal journey as like that of Africa. We have great opportunities in just about every sector. We have the brains, we are learning the how, and we have the undying spirit to never stop trying. On an annual basis, Africa attracts over 56 million overseas visitors and we are growing. Our GDP is approximately $2.7 Trillion (nominal) and growing on average at 3.7%. These are impressive figures since other great economies are either in no growth or receding positions. Although we are behind compared to other continents on various economic measurements, Africa is the only continent/region where there is still a decent growth statistic to speak about. There remains a potential to be exploited across the continent. Infrastructure and finance are perhaps the most critical of sectors by which the continent can go forward. Infrastructure makes the wealth accessible and finance becomes the means, by which new businesses and industries in developing regions can take off. Governments are on a constant push for more funds available both as investment into the continent and as debt. Due to slowdown in the world economy because of the covid-19, we have seen nations such as Zambia default on debt servicing fees – and it looks like a few other nations may follow suit. Increasingly the African nations are forced to deal with China which presents a more flexible finance structure normally tied to actual infrastructure projects as debt or to some sort of mineral wealth. China needs everything it can get hold of in terms of resources to feed its huge economy and population. This explains why China is so vested in the affairs of the continent. When Africa needs to sell its wood, cotton, or mineral ores – China is lining up to be the first in line. While the China effect may be seen in some quarters as negatively impacting on Africa as a developing continent, I believe Africa has an opportunity to negotiate better and more flexible terms with China than it did in the past with the west. It also forces funders from Europe and America to approach the matter with much more tact with regards to the social impact of loans on the ordinary man and woman on the street. There is no doubt, Africa is rising. Africa remains the only continent where there has been consistent growth in all major sectors. With multimillion projects planned across the continent over the next few years, electric power generation projects underway, roads, bridges, schools, and hospitals to improve the overall health of all Africans, we are standing at the cusp of something very special.

Africa Global Gateway will endeavor to bring you all the important and critical information necessary for you to get involved and participate in what is going on the continent. We cherish your support and upload all our readership. Wishing you a prosperous and healthy 2021! Peter Ngozi-Nyirongo MANAGING PUBLISHER

The Leonardo, Sandton 6 The Africa Continental Free Trade Area

28 The Leonado. Scraping the African Sky


Renewable Energy Path for Africa

12 Life after Lockdown

16 Rwanda’s Vision 2020


18 West Africa Offers Lucrative Business Opportunities


60 North Africa. Bright Prospects a Decade after the Arab Spring

Zambia. Core Sectors Holding Growth Potential

66 Booming Tech Hub Scene to Bolster African Growth

African Agriculture. RESILIENT

68 The Wedgewood Sandton. Balwin’s R1.6BN Project

74 Make Money on Real Estate



the africa continental free trade area a pathway to awaken the african giant

6 | africa global gateway

In June 2015, at the twenty-fifth Summit of the African Union, held in South Africa, African Heads of Government agreed to the creation of a continental free trade area through negotiations on the liberalization of trade in goods and services. The initiative, based on the January 2012 agreement of the 18th Ordinary Session of the Assembly of Heads of States and Governments of the African Union held in Addis Ababa, Ethiopia, is set to present major opportunities and challenges to boost intra-African trade.


hree years later in Kigali, Rwanda – African leaders held an Extraordinary Summit on the African Continental Free Trade Area (AfCFTA) from 17-21 March 2018 during which the Agreement establishing the AfCFTA was presented for signature, along with the Kigali Declaration and the Protocol to the Treaty Establishing the African Economic Community relating to the Free Movement of Persons, Right to Residence and Right to Establishment. The goal of AfCFTA is to establish a single market for goods and services across Africa’s 54 countries, allow the free movement of business travellers and investments, and create a continental customs union to streamline trade - and attract long-term investment. The agreement is seen as critical for growth and job creation for Africa and its 1.27 billion people. It will also expand intra-African trade through better harmonization and coordination of trade liberalization and facilitation and instruments across the RECs and across Africa in general. The AfCFTA is also expected to enhance competitiveness at the industry and enterprise level through exploitation of opportunities for scale production, continental market access and better reallocation of resources. A shared Prosperity Intra-Africa trade has been historically low. According the World Economic Forum, Intra-African exports were 16.6% of total exports in 2017, compared with 68% in Europe and 59% in Asia, pointing to untapped potential.

africa global gateway


Owing to the disparity between nations and regions, and economies being at differing levels of development, leading to fragmentation, the role of the African Union will be to ensure shared prosperity on the continent, creating supportive policies, eliminating monopolies, and stamping out uncompetitive behaviour. For many African countries, most of their trade is still with global trading partners. While a new trade agreement does not guarantee trade, it does change the incentives to make trade with other partners to that agreement more accessible and attractive. The AfCFTA has the potential to put in place mechanisms to address many of the non-tariff challenges frustrating intra-African trade. According to Trudi Hartzenberg, Executive Director, Trade Law Centre, it could do so in a manner which will provide more certainty and predictability and improve the trade facilitation environment. The potential dynamic benefits of the AfCFTA are particularly important. Larger integrated markets may well be more attractive to investors and along with new investment could come new technologies and learning that could boost productive capacity. The AfCFTA will bring together all 55 8 | africa global gateway

member states of the African Union covering a market of more than 1.3 billion people, including a growing middle class, and a combined gross domestic product (GDP) of more than US$3.4 trillion. In terms of numbers of participating countries, the AfCFTA will be the world’s largest free trade area since the formation of the World Trade Organization. Estimates from the Economic Commission for Africa (UNECA) suggest that the AfCFTA has the potential both to boost intra-African trade by 52.3 percent by eliminating import duties, and to double this trade if non-tariff barriers are also reduced. While strengthening the multilateral trading system remains vital, a parallel negotiation process to expeditiously launch the AfCFTA and monitor the implementation of the related agreement is also important. Also, in order to multiply the benefits of the AfCFTA and promote developmental regionalism in Africa, a comprehensive vision of trade and development needs to be in place. Expanded markets for African goods and services, unobstructed factor movements and the reallocation of resources should promote economic diversification, structural transformation, technological development and the enhancement of human capital.

Operational Phase The operational phase of the AfCFTA was launched during the 12th Extraordinary Session of the Assembly on the AfCFTA in Niamey in July 2019. The AfCFTA will be governed by five operational instruments: a) the Rules of Origin; b) the online negotiating forum; c) the monitoring and elimination of non-tariff barriers; d) a digital payments system e) and the African Trade Observatory. In addition to the Niamey Declaration on the Launch of the Operational Phase of the AfCFTA – the key outcome – the following Decisions were adopted by the Assembly: a) on hosting of the Secretariat of the AfCFTA; and b) on the successful hosting of the 12th Extraordinary Session of the AU Assembly and the First Mid-Year Coordination Meeting between the AU and the RECs (Regional Economic Communities) Opportunities and Challenges According to the United Nations Conference on Trade and Development (UNCTAD), the path towards accelerated panAfrican economic integration presents formidable political, economic and legal challenges. High on the list of challenges in relation to the AfCFTA is the conflicting disciplines and benefits of the different regional economic communities already in place. Most African countries are parties to more than one regional economic community and convergence between different communities, should be made compatible with the goals and timelines set for the AfCFTA. African

mainly on the architecture of the General Agreement on Trade in Services. Services trade also needs to be adequately mainstreamed into national development plans.

countries need to set a clear path to making regional economic communities converge into the AfCFTA. In this regard, the agreement reached in June 2015 among the States launching the Tripartite Free Trade Area is significant. Tariff Liberalization The AfCFTA seeks to provide a stable, predictable, and improved environment for trade facilitation, which has the ability to put in place means to tackle a lot of non-tariff challenges frustrating intra-African trade. A lot of African Countries will still conduct their trading with other global trading partners, however while the AfCFTA does not necessarily guarantee trade, it however hugely makes the incentive to conduct trading with fellow partners to the agreement, more appealing and also accessible. In the exact words of Wamkele Keabetswe Mene, the Secretary-General of AfCFTA, “The AfCFTA is therefore a critical response to Africa’s developmental challenges. The Tripartite Free Trade Area agreement on the removal of tariffs and non-tariff measures constitutes a basis from which negotiations on continental tariff liberalization may begin. Negotiations on trade in services should be conducted in parallel with negotiations on trade in goods, in order to open opportunities for African services and services providers. Some services sectors are necessary for facilitating trade in goods, such as transportation and storage. Services sector negotiations, to be manageable, may initially focus on a few key sectors and later be expanded. Such sectors, as reflected in UNCTAD services policy reviews, may include the following: distribution; finance; information and communications technology; infrastructure; telecommunications; and tourism.

Strong AfCFTA Support Mechanisms Required to Level Playing Field Serious consideration should be given to the organization of the negotiating process itself. There can be no doubt about the complexities associated with negotiating an agreement among 54 participating countries with unequal negotiating capabilities, unequal human resources and unequal know-how on the issues to be included in the CFTA, as well as differences in productive and competitive strengths. Regional and international organizations such as UNCTAD, working closely with the African Union Commission and African countries, could play an important role in assisting African negotiators and policymakers to move the CFTA process forward, including towards a legal framework that is conducive to sustainable development, and they can do so efficiently by cooperating among themselves and coordinating their different contributions to the CFTA negotiations. Response to COVID-19 During this phase of COVID-19, Africa needs to rely on itself as borders close and international trading alternatives are limited. Wamkele Mene, the

Secretary General of AfCFTA has explained how AfCFTA makes for a very powerful tool during Covid-19. “A short-term tool has been devised by the Heads of States to launch trade corridors to enable easy access and transit of what the African Union arm for Disease Control and Prevention (Africa CDC) terms as essential goods or germkilling products like soaps, disinfectants that help combat the pandemic. In order, for these essential goods to become affordable and available to people, the African ministers of trade are exploring the possibility of reducing duties. These are the temporary measures being put in place with the view of accelerating Africa’s industrial development being the long-term goal. In these unprecedented times of the COVID-19, the AfCFTA, which will result in increased intra-African trade and drive economic growth in Member States, the initiative provides the best stimulus package and Marshall plan to accelerate economic recovery of African countries and build the resilience of African economies post-COVID-19. Way Forward Going forward, AU Member States are working with the AU Commission and other key strategic and technical partners to ensure that trade under the AfCFTA effectively begins on 1st January 2021 as decided by AU Heads of State and Government on 17 June 2020. v

A pan-African services agreement could build upon existing services agreements in regional economic communities that range from cooperation to fully fledged services liberalization, drawing africa global gateway


economic recovery life after lockdown

“Igniting economic activity requires partnership and collaboration,” Ramaphosa said as he promised South Africans a massive total of 800, 000 jobs. Reports early July had shown that almost 3 million jobs were lost in South Africa as a result of the Covid-19 pandemic and subsequent lockdown. As nations are trying their best to recover from the economic damage caused by the pandemic, President Cyril Ramaphosa presented his well-articulated and much-anticipated economic stimulus and recovery plan.

12 | africa global gateway

It has been claimed that a massive R100 billion has been committed to job creation for over the next three years. This has been seen by many as a bold move. In his bold statement, Ramaphosa said the 800 000 job creation will be through public and social employment. As their economic recovery plan is, the government is said to target the employment of 300 000 school assistants, 40 000 teaching posts, an additional 6 000 community health workers and nursing assistants as well as 60 000 jobs for labor-intensive maintenance and construction of municipal infrastructure and rural roads. What has been referred to by many other author as President Cyril Ramaphosa’s economic reconstruction and recovery plan, seems to center much on infrastructure and mass employment programs but also raising a standard against corruption. The president’s one hour and twenty minutes speech was mostly centered on Infrastructure and mass employment programs. From the view of things this plan seems not only to be well built but also aims at accelerating implementation and delivery by tighter coordination within government, backed up by strong political will. According to plan, the governments is seeking at ensure that work opportunities are up and running within three months, or by the end of January 2021. Defined as an “employment stimulus”, the aim is to create 800,000 job opportunities before the end of the 2020/21 financial year. It is understood that out of the planned R100 billion, R13.8-billion is immediately available for this. The other issue that accompanied the creation of jobs was the war against corruption. From the comments made by the president as well as the latest actions by the law enforcement and prosecution agencies against corruption do give the nation hope. People have now turned out to believe that the president is on to something here. It remains a mystery however to weather he will pull through and deal a decisive blow against corruption. An act that mitigates corruption will eventually eliminate the unnecessary drain of corruption on the fiscus. If that happens, the promises he makes in his economic stimulus and recovery plan may gain traction.


s of the current state of affairs, the president conveyed a speech enlisting his economic recovery plans in the same manner as always, with a liberal measure of hope and promise. During his speech, he was quoted saying “It must be a national effort in which all of us work together to restore our economy to growth in the immediate term and prepare the ground for sustainable, inclusive growth into our future.” What madman can stand and argue against this bold statement really? The people has no issues with the plan, but what they question is the implementation, people want to see the results on ground. It is viewed that, most people of this country have been crying for a shift from leaning on political ideologies to relying on economic realities, as implementation has not been our strong point as a nation.

President Cyril Ramaphosa has been credited as being different from his predecessors as he seem to have a greater appreciation for collaboration between government and the private sector. Arguably, his predecessors seem to stick to a stubborn insistence that the government must be everything to everyone. Others have suggested that the government should try to collaborate with the private sector for job creation. As of the moment, the approach to job creation for instance remains to a great extent an attempt by government to provide jobs by itself. v

africa global gateway

| 13

rwanda’s vision

Rwanda’s success story is a true description of the phrase, from rags to riches. Rwanda has had a complex, and often troubled, history. When Paul Kagame became Rwanda‘s president in 2000, automatically he inherited a nation that had been torn apart and burned down by genocide.


rom 6th April to June 1994, the nation experienced the worst hundred days ever. During the Rwandan genocide, an estimated 800,000 Rwandans were killed in the space of 100 days. The economy of the nation crumbled, their government and political systems fell. To rebuild it, Kagame had to rely on mostly uneducated guerrilla fighters and a handful of ill-trained cadres. Even the most optimistic of analysts doubted his chances. People might question the existence of god or gods and other mystical beings and powers but then the actuality of miracles happening is in this case out of question. 16 | africa global gateway

Because 19 years later, the country is stable, prosperous, unified and, in large part, reconciled.

Singapore seems to be a great inspiration to Rwanda. The country says it aspires to be as successful as the Asian country. Although statistical data shows that 39 percent of the population in Rwanda lives below the poverty line, still the country has still come a long way, rebuilding from the ashes thus the aftermath of the 1994 Rwandan Genocide and witnessing steady economic growth. According to record, in the year 2000, the Rwandan government established what they called Vision 2020. The government of the day developed a longterm development strategy with its main goal to transform Rwanda into a middle-income country by 2020. As of the current times, The Rwandan economy is reputed as the

2020 fastest growing economy. “The economy was destroyed and through the process of economic reconstruction, it picked up with a tendency to go very fast, faster than the economies which are already developed,” said Golloba-Mutebi.

Historically, it was put to record that in 1995,

the economic growth was able to pull at least one million citizens out of poverty between 2005 and 2011. Ghana announced that it would achieve a middle-income status similar to Singapore by 2020. However Rwanda is the only country in sub-Saharan Africa that has come close to emulating Singapore’s rags-to-riches story, even though not in the same spectacular style. The Rwandan president Kagame once referred to Singapore as “an inspiration for us in Rwanda.” According to their so called Vision 2020, the Rwandan government is tasked with ensuring good governance, which includes accountability, transparency and efficiency in deploying scarce resources to key sectors of the national economy. In the year 2017 Rwanda was ranked the third least corrupt country on the African continent behind the Seychelles and Botswana. It should also be noted that the 2019 World Bank Doing Business index, ranked Rwanda

as the 29th easiest place to do business in the world, the only low-income country in the top 30. A Household Living Conditions Survey that was done by the government had shown that the economic growth that Rwanda has experienced was able to pull at least one million citizens out of poverty between 2005 and 2011. However despite all the achievements and the economic booming in Rwanda, others have negatively criticized Kagame’s government. Their argument is that the success of Rwanda over the past 19 years has come at the cost of political freedoms like a clampdown on dissenting views and media rights. Kagame has been president of Rwanda since 2000. By contrast, other sub Saharan countries have peacefully exchanged power in presidencies. Others have also viewed it from a positive side arguing that President Paul Kagame’s leadership has played a positive role in terms of the political stability the country has enjoyed since 1994. It is believed that if there was no political stability in the country, there would be no development. The government is believed to have established key institutions that would help it achieve its objectives enshrined in Vision 2020. v

africa global gateway

| 17

There is general consensus among scholars, policy makers, and political leaders that the best way for African countries to build and grow economically is through regional trade. Regional integration and trading blocs have been viewed by many as ways that African nations can use to achieve sustainable development and increase their involvement in the global economy.


y the number, Africa is divided into several regional trading blocs; whose main aim is to realize increased regional integration through customs and monetary unions, free trade areas, and common regulatory and legal frameworks. African is divided into four main blocs namely; the Economic Organization of West African States (ECOWAS), Common Market for Eastern and Southern Africa (COMESA), Southern African Development Community (SADC), and Community of SahelSaharan States - CEN-SAD. The western side of Africa makes the ECOWAS. Recently there has been a new development in the west Bloc of Africa. Turkish economy minister brought up a suggestion that a free trade agreement will be a key step to enhancement business relations between Ankara and the Economic Community of West African States. The minister was quoted saying “Trade volume with the bloc increased 10 fold to over $2 billion in the last decade from $200 million.” He further stressed that their aim is to bring it up to $5 billion in the short term and to $10 billion in the long term on a win-win approach. He is of the belief that the only way to achieve this is a free trade agreement between Turkey and ECOWAS. Kalilou Traore, the bloc’s commissioner, also spoke at the function, his position was that there are so many investment opportunities in West Africa. ECOWAS countries offer lucrative business opportunities in infrastructure projects in various sectors such as railways, roads, hospitals, energy, maritime, and agriculture. Question might be asked, why invest in West Africa? According to statistical data, West Africa’s equity markets are hot and the main markets has risen by 50% in the past 5-10 years. For other obvious reasons, Africa is hungry for new products, technologies, and knowledge and preferred market for Slovenian and European economy. There is a great economical potential for West Africa and its highly dense populated cities provide a huge market for goods and products. Countries such as Nigeria, Ghana and many others has a huge concentration of population in large cities such as Abuja, Legos and others. Some of the cities are logistically accessible as they are located along the Atlantic. To further the argument, the West Africa bloc has consumer nations and they are not technologically advance like America and Europe while American and European markets are saturated with supply and there are few demand. There are a number of businesses that made a couple of millions last year and partly this year, it is only right to argue that these business will eventually do even better with time. For a start its 18 | africa global gateway

right to invest in African food brands for export. FairAfric and Garden of Coffee for example has over time established a uniquely African product brands that have the potential to become big hits on the international market. In 2018 alone, the business made and exported over 250,000 chocolate bars, and raised about €50,000 from investors on Kickstarter. On top of that commodities like raw cocoa and coffee beans are readily available in Ghana and other parts of the western bloc. Solar sector is one perfect business to invest in. African states have always struggled with electrical problems and West Africa is no exception. Africans are tired of waiting for energy from centrally-managed power grids that are slow to deploy, inefficient, and inflexible to the continent’s growing power needs. This is an opportune sector for investments. Solar is the most attractive sector to invest in because the demand is massive. Last year in DR Congo, a solar

ecowas offers lucrative business opportunities in infrastructure, health, energy, maritime, and agriculture

– west africa

system developer signed a deal which saw him installing solar systems for over 2.5 citizens. In Togo, BBOXX has also entered a $4 million partnership deal with the government to supply 300,000 homes with off-grid solar kits. Other sectors are education, fashion and apparel, film production and distribution, apartment hotels and digital financial services

that you have to be escaped from? Or do you see these problems as opportunities in disguise that could unlock significant rewards in terms of market value, wealth, and jobs? By the end of 2020, it’s still the same continent. But the perspective you take on Africa can make a world of difference. Africa is a market that overwhelmingly rewards problem solvers. v

The whole of African seems so helpless, a continent overwhelmed by problems. The coming of the Covid-19 did not help but make things worse. Now the question is, do you see a continent stunned with so many difficulties africa global gateway

| 19

comesa objectives and priorities


owever, due to COMESA’s economic history and background its main focus is on the formation of a large economic and trading unit that is capable of overcoming some of the barriers that are faced by individual states. COMESA’s current strategy can thus be summed up in the phrase ‘economic prosperity through regional integration’. With its 21 Member States, population of over 583 million a Global Domestic Product of $805 billion, a global export/ import trade in goods worth US$ 324 billion, COMESA forms a major market place for both internal and external trading. Geographically, COMESA almost two thirds of the African Continent with an area of 12 Million (sq km).

What COMESA Offers

COMESA offers its members and partners a wide range of benefits which include: 1. A wider, harmonised and more competitive market 2. Greater industrial productivity and competitiveness 3. Increased agricultural production and food security 4. A more rational exploitation of natural resources 5. More harmonised monetary, banking and financial policies 6. More reliable transport and communications infrastructure The Secretariat The Secretariat is the executive Organ of COMESA. It ensures that the regulations and directives adopted by the Council of Ministers are properly implemented, and provides the Council of Ministers with strategic recommendations. It is comprised of the Executive 20 | africa global gateway

Management- Office of the Secretary General, Assistant Secretaries General for Programs, Finance and Administration, and the Management Team. The Secretary General The Secretary General (SG) is the Chief Executive Officer of the Common Market. The SG represents the Common Market in the exercise of its legal personality and acts as the secretary to the Authority and the Council. This office ensures that the objectives set out in this COMESA Treaty are attained. Strategic Planning, Research & Policy Harmonisation The Strategic Planning, Research and Policy Harmonisation Unit of COMESA Secretariat takes the lead in developing and formulating strategic plans and work programmes. The Unit collaborates with Divisions, Units and COMESA Institutions to ensure alignment and to create a strategic culture which calls for individual and collective actions to work towards attainment of set objectives. Resource Mobilisation & International Cooperation The objective of the unit is to contribute to the impact, efficiency and effectiveness of COMESA Member States trade reforms and regional integration initiatives so that they can fully benefit from regional and international trade opportunities, reduce poverty and achieve their (MDG) development Governance, Peace & Security  The COMESA Governance Peace and Security (GPS) Programme derives its mandate from Article 3(d) of the COMESA Treaty. The programme was established by the Fourth Summit of the COMESA Authority, which was held in Nairobi, Kenya

The history of COMESA began in December 1994 when it was formed to replace the former Preferential Trade Area (PTA) which had existed from the earlier days of 1981. COMESA (as defined by its Treaty) was established ‘as an organisation of free independent sovereign states which have agreed to co-operate in developing their natural and human resources for the good of all their people’ and as such it has a wide-ranging series of objectives which necessarily include in its priorities the promotion of peace and security in the region.

in May 1999. The COMESA Authority of Heads of State and Government endorsed a decision for the establishment of a formal structure for engagement on matters of peace and security and mandated COMESA Ministers of Foreign Affairs to meet at least once a year to discuss modalities for addressing issues of peace and security. The programme has a short three tier decision making structure comprising the Committee on Peace and Security, the Ministers of Foreign Affairs and the Authority. Trade policy analysts/specialists and legal/ economic affairs officers Trade policy analysts/specialists and legal/ economic affairs officers work in various divisions of COMESA Secretariat. In addition to providing specialist advice in their respective divisions, they provide support to bodies serviced by COMESA divisions (e.g. committees, working parties, negotiating groups, etc.) and contribute to trade policy review mechanisms established at COMESA. They also conduct research and analysis and deliver technical assistance and training on relevant topics. Requirements: An advanced university degree in international relations, economics, law or a relevant field, knowledge of relevant COMESA agreements and the COMESA system, a high level of drafting skills, research and analytical skills, presentation skills as well as the ability to work as part of a multicultural team. Research economists Research economists undertake research on policy-related topics in connection with COMESA’s activities. More specifically, they take a lead role in preparing COMESA’s

flagship publications, produce other analytical reports and provide economic expertise to other parts of the Secretariat as required. They also deliver technical assistance and training on the relevant topics. Requirements: An advanced university degree, preferably a Ph.D., knowledge of international trade and other branches of economics, analytical skills, policy-oriented research skills, high level of drafting skills and presentation skills, ability to work as part of a multicultural team. Statisticians Statisticians provide quantitative information on economic and trade policy issues. They collect and organize trade-related data, maintain the relevant COMESA databases, and undertake data analysis and dissemination. The output of COMESA statisticians is made available to the relevant COMESA committees and is utilised in trade policy reviews and in other areas of research. Requirements: An advanced university degree or equivalent in a

quantitative subject such as mathematics, statistics or economics, knowledge of statistical concepts, good IT skills of use for statistical analysis and database/information management, ability to work as part of a multicultural team. Lawyers Lawyers contribute to the dispute settlement process of COMESA by assisting a panel established for a dispute or the Appellate Body members considering an appeal. Their role is to deliver substantive legal advice and to conduct research on legal, technical or procedural issues in dispute settlement or appellate proceedings. Requirements: An advanced university degree in law (including international trade law and public international law), knowledge of international, legal and economic principles and issues, adjudicative process and practice, a high level of legal drafting skills, analytical and problem-solving skills and presentation skills, as well as the ability to work as part of a multicultural team. v

africa global gateway

| 21

current corporate fashion

what’s acceptable now when it comes to clothes in the workplace? By Nikki Temkin Covid- 19 and the subsequent lockdown has meant that we’ve been working from home more often than not. Perhaps some even had pyjama bottoms on during Zoom meetings – and shirts and ties on from the top up.


oes this mean that the trend is towards being more informal now that we’re returning to the workplace? And is it acceptable to be less concerned about your look when in your home office for virtual meetings?

you can keep it simple but do not revert to sunday sweats or beach attire... According to expert personal branding specialist, Lori Milner, “Your dress symbolises the impact you want to have on the room. When you’re the only one in your room, it begins to feel less important. But, dress is part of your physical presence and comes down to trust. Think how a pilot shows up in their uniform, it conveys an aura of authority because you really are 22 | africa global gateway

putting your life in their hands. You need to be able to inspire trust in yourself and your work from others the way a pilot does. Being in a remote or virtual setting without the benefits of face to face interaction, your non-verbal cues play an ever bigger role.” Your personal brand So, you are your brand and your clothing is representative of your personal brand. You will be facing your team, leaders and clients again in person, but it is up to you to create a consistent brand throughout this period. To be taken seriously, you need to show up in a way that signals to

them you are capable of great things. Although it feels arbitrary to make an effort in what you wear, it will go a long way to inspiring trust. You can keep it simple but do not revert to Sunday sweats or beach attire because this projects a very different message. So, don your suit or your best work outfit to give off the best possible message to your managers and colleagues. Fashion the right mindset Investing time and energy into yourself is not just about getting dressed up but also sets your intention and head-space for the day. Think of it like this: When you dress in the morning for the day, you’re

setting your intention of who I want to be for the day ahead and how you want to operate. If you’re meeting an important client or doing a workshop, then get ready as if you are meeting them in person. “It is not only about how you want to show up for them but how you want to show up for yourself. You need to feel inspired for the day ahead and it won’t happen in gym or holiday gear,” says Milner. Getting ready for the day is not just about your work colleagues and clients; it is a transition tool to get you from personal mode into work mode. It puts us in the right kind of mindset. Most of us have never had to work from home before so you need to include rituals to establish your personal time from work time.” It gives you context for where to focus your energy, time and attention. It distinguishes leisure time from work time. We may not always have a different physical environment but we can put ourselves in different mental one based on how we show up for the day,” concludes Lori. v

africa global gateway

| 23

what is it that makes cape town such a desirable investment for locals and foreigners alike? By Nikki Temkin

cape town property in demand

Abundant glorious nature, crashing cliffs, sparkling blue water … that’s Cape Town. Throw in the cosmopolitan nightlife, fine dining and a dollop of culture, it’s no wonder that people the world over choose not just to visit, but to settle there. What’s not to love? Cape Town has gained traction as a hotspot in which to live, work and retire.


f course, post-Covid19 the property landscape is very different, but the sector is already seeing major recovery and there’s every reason to remain positive about the outlook. It’s known that during times of economic turmoil, many investors tend to seek ‘safe harbour’ in brick and mortar assets. This is made even more attractive by the present low interest rates and increased net yield on properties. The past has shown that after a crisis, there’s always a rebound and it’s 24 | africa global gateway

hopeful that it will be back to business as normal in time. Beauty and bounty Dr Andrew Golding, chief executive of the Pam Golding Property group explains, “Internationally renowned as a prime global destination, Cape Town’s scenic beauty - coupled with the close proximity of the ocean, world class Blue Flag beaches, rugged coastline, mountain ranges such as the 12 Apostles, Lions Head and Signal Hill - together with easily accessible, award-winning wine farms, makes Cape Town the obvious choice for the HNW individual looking for a first world setting yet with unique attributes, all in one compelling location. Cape Town is also fortunate to have a competent local government and is a very well-run city filled with friendly, down-to-earth people. You

have the best of both worlds- to be out of the rat race of a very large city, but to feel like you’re on holiday all the time. All this, plus the fact that many internationally acclaimed architects have contributed to our unique offering of luxury homes, which match the highest standards on the planet, ensure that the Mother City remains top of the list for the international HNWI. Gaining currency Let’s also not forget that the exchange rate means that those who live overseas will get a lot more bang for their buck in South Africa—buyers are able to afford more spacious, more expensive homes in desirable areas in South Africa than what they would be able to acquire in their home countries.

Golding says, ““Furthermore, many of our iconic, trophy homes offer exceptional views of both ocean and mountains, as well as a west- facing orientation which offers some of the most memorable sunsets in the world.” Who could resist? v africa global gateway

| 25

The Leonardo is a 55-floor mixed-use property development standing at 234 metres (768 ft) in Sandton, Johannesburg, South Africa becoming the second tallest building in Africa after the great Mosque of Algiers which stands at 264 metres. The Leonardo is situated at 75 Maude Street, Sandton, a mere 100 metres from the Johannesburg Stock Exchange is proving to be a gem and a major landmark in a central district that plays host to some of the most iconic buildings in Africa.


his sky-scraping development includes street level shops as well as an above ground podium, where a swimming pool, restaurant and several other facilities can be enjoyed. The facilities are open to public use and can be booked onsite and other online booking portals showcasing apartments, entertainment spaces and resorts. The Leonardo boasts a 2100 square metre, 3 floor penthouse apartment that went on the market for R180 million making it the most expensive sectional title property ever sold in South Africa. The Leonardo is a magnificent structure costing R3 billion and comprising 200 apartments with 11 floors of commercial office. On 17 November 2015, the Leonardo began construction, and by end 2019, the Leonardo was topped out and is now officially the second tallest building in Africa. The Leonardo’s architectural Design was a brainchild of South Africa’s Co-Arc International Architects and is developed by Nedbank Property Partners in collaboration with Legacy Group with JSE-listed Aveng Grinaker-LTA as contractor. Features The development includes two levels of public areas off the street linked by an escalator to an interactive lobby space which will be home to the reception area servicing 254 apartments, as well as penthouse suites with their own gardens. The Leonardo also boasts 7 500 sq. meterage of commercial office space. 28 | africa global gateway

Scraping the African sky

the leonardo

...dubbed in 2019 as “one of the most

anticipated buildings in the world” hotel. The Leonardo also includes several penthouses reaching from the 49th to the 55th levels. In addition, the Leonardo also features outdoor patios and gardens, with a 20-metre lap pool and gym area. Perfect Location The Leonardo’s record height and proximity to key areas of interest such as the Johannesburg Stock Exchange and the Sandton City has made it a highly anticipated project featuring on several skyscraper lists around the world and dubbed in 2019 as “one of the most anticipated buildings in the world” Tallest in Africa The Leonardo was initially pegged to take the title of the tallest building on the continent, but at 264 metres high, the Great Mosque of Algiers Tower has taken that prize. The Leonardo features landscaped gardens, restaurants, a bar, a crèche, a gym, and a spa which will be linked by shuttle lifts directly into the parking garage. Legacy Hotels have invested in 10 floors in the building to accommodate a luxury

The Pinnacle Tower in Nairobi, when completed, is planned to stretch over 300 metres into the air and take the title of “Tallest in Africa”. Construction on The Pinnacle launched in January 2018 and is expected to be completed in 2021. v

africa global gateway

| 29

By Sinethemba Zonke

north africa bright prospects a decade after the arab spring It is a decade since the Arab world was shaken by protests that sought to overhaul regimes that had ruled for decades with an iron fist over their people. In North Africa and other Arab countries in the middle east, authorities stayed in power for decades under the military or theological rule.


he resource wealth of these nations allowed the governments to quell people’s resentments over the lack of democratic freedoms by providing stability through a strong economy and jobs. However, as the first decade of the 21st century came to an end, and the global energy market became more competitive leaving oil and gas under pressure, middle eastern nations could not sustain this strategy. With dire 30 | africa global gateway

economic conditions, citizens of Arab country were more emboldened to take on their governments. The Arab youth demanded more political freedoms from their governments as they saw that the authoritarian regimes, they lived under no longer offered an economic environment that delivered jobs and prosperity. The Arab Spring saw the toppling of three regimes in North Africa, in the states of Egypt, Libya, and Tunisia. Morocco and

Algeria were able to withstand and go mostly unscathed during the protests; however, the rulers in these countries were aware of the dangers posed to their political futures and tried to make some internal changes. A decade after the Arab Spring, the North African region is quite different, with security still being a significant risk primarily because of the situation in Libya, which has yet to have a stable government. Tunisia is still the only real democratic success from the uprisings, although its democracy remains fragile. In the past year, there have been ongoing

protests across the North African countries. Algeria, which withstood the previous Arab spring saw the ousting of President Abdelaziz Bouteflika after 20 years in power. The political situation in the North African region is likely going to continue to witness some upheavals for some time as the people in the region demand greater political freedoms. While this happens, the ruling regimes will be adapting in various ways while ensuring the security of elite power while giving some leeway for the larger populations. The political and social development pains will impact the investment and economic opportunities in the region in different ways.

Algerian ($170 billion GDP) and Morocco ($119 billion) occupy positions three, four and five respectively in terms of ranking of Africa’s largest economies. Libya ($52 billion) and Tunisia ($38.8 billion) make it into the top 20 rankings at 12 and 14, respectively. According to the Rand Merchant Bank Attractiveness Rankings for 2019, Egypt and Morocco the number one and number two most attractive jurisdictions in Africa respectively. In 2019 Egypt, Morocco and South Africa received the greatest share of foreign direct investment in Africa. Egypt went on to overtake South Africa by becoming the top-ranked destination for projects. North Africa, as a whole, accounted for 26% of FDI projects on the continent.

North Africa remains one of the best performing economic regions on the African continent, with three of the top five largest economies on the African continent. Egypt ($303 billion GDP),

The North African region had a great 2019, having the secondfastest growing economy after East Africa (5%) with a 2019 growth rate of 4.1%. As a result of the coronavirus, crisis growth could africa global gateway

| 31

see a growth rate of -2.3%. The economic prospects of the North African region, as with the rest of the world, will be affected by the covid-19 pandemic. The recovery from this crisis will depend on strong management from the respective governments, the core economic pillars and long-standing bilateral trade relations with other nations. The region has been projected to have an average growth rate of 4% from 2019 to 2024, which is likely to be revised as a result of the Covid-19 crisis. However, even with the pandemic, the region will likely maintain its spot as the secondfastest-growing bloc in Africa. The pandemic has forced most countries in the region to seek economic assistance from the International Monetary Fund (IMF) and other financial institutions. Morocco has been one of the better placed countries as it has had relatively positive socio-political and economic outlook. The covid-19 crisis will continue to hang like a spectre for a while after 2020, however investors and stakeholders who know the economies of Africa will be aware of the strong fundamentals and great opportunities that still exist in the region. In the North African area, the economies are some of the most developed on the African continent with the most dominant sector being the services industry. Libya is the only exception amongst the North African countries as its economy remains dependent on its immense oil reserves. The share of the services sector is as high as 62.7% in Tunisia and 56.3% in Morocco. The average for the region is around 49.2%. Tourism is a crucial sector for Egypt and Morocco where it has accounted for 25% and 20% of total exports respectively. The industrial sector and manufacturing also play significant roles in the economies of these countries. In Algeria, the hydrocarbons sector, mainly gas is very pivotal to the economy. The market size of Egypt is a factor that makes it favourable to investment. Its size is second to Nigeria in nominal terms, with Egypt being assisted by having an advanced business environment compared to its neighbours. As a premium FDI location in Africa, Egypt continues to push several strategic projects. In May 2020, the Minister of Petroleum and Mineral Resources, Tarek El-Molla, announced a plan for the petrochemicals sector valued at $19 billion. The program consists of 11 32 | africa global gateway

projects that will be implemented between 2020 and 2035. This plan will be boosted by the support it will receive from the US International Development Finance Corporation and the US Export-Import (EXIM) Bank. Besides the United States of America, Egypt has strong relations with the United Kingdom, which remains by far the largest investor in the North African nation’s economy. Egypt benefits significantly from its geographic position at the intersection between the Middle East and Africa. It will continue to play a vital strategic role in the security of the region which will see it maintaining generous relations with the USA and other Western powers with interest in the region. Before the pandemic, Egypt had seen growth rates of 7%. The government had projected a 6% growth in 2020. While it will take some time to recover, Egypt is sure to reach the preCovid-19 levels of growth again. Tunisia entered RMB’s top ten most attractive markets for 2019 as a result of market reforms that have created a more favourable operating environment. Tunisia also has a sizable market, which has become increasingly attractive to international manufacturers since the government simplified the nation’s investment code. In 2020 Tunisia moved up two places in the World Bank’s Doing Business Report 2020. This improvement was due to new laws that have made it easier to start a new business, pay taxes and register property. In 2019 the majority of FDI went to Tunisia’s industry at $450 million, energy at $300 million and services at $95 million. The largest investor in Tunisia is France. The French President, Emmanuel Macron has been pushing to improve ties between Tunisia and France, mainly because of Tunisia’s strategic location to Libya. In September 2020, France and Tunisia signed two agreements to convert debt into investment projects for the promotion of higher education. The two countries also signed a deal worth €9 million for the support of small businesses. As the world recovers from the corona crisis, Tunisia is looking to make gains in the tourism sector. The country had a record of 9.43 million visitors in 2019. With the opening up of travel, Tunisia and the other North African countries will benefit a great deal from international visitors. africa global gateway

| 33

The North African region is still dealing with the results of the Arab spring from a decade ago, with a couple of aftershocks that have occurred recently in the region. The political and security situation will remain a concern for the medium to long term, while Libya remains a divided nation. Despite the political and security challenges, North Africa’s proximity to Europe has some economic opportunities. Being close to the advanced economies of the European 34 | africa global gateway

Union (EU) makes the North African countries pivotal spots for future projects in manufacturing as well as energy to cater for the ageing and developed European market. European countries are also likely to see to it as an imperative to ensure economic development in the African countries separated from European shores by the Mediterranean. This will be to create a buffer zone for the growing numbers of migrants coming into Europe and creating

internal problems from European citizens who are not ready for multiculturalism. The North African region will also benefit from its connections with the two economic blocs of the Middle East and the broader African continent. The African Free Trade area will allow the North African nations to position themselves as a gateway to the African market of over a billion people. v


part i: a wrapper


recall the day polygamous Uncle Muzembe visited us, his two wives in tow. One fat, lazy and talkative. The second wife, radiated the impression that she would break into pieces right under your gaze. She was delicate, slender and youthful. I am yet to see another grown woman as slim. I was the youngest among the collection of cousins under Grandma’s care. That gave me the license to habitually stay away from heavy farm work. The swarm of cousins called me ‘Mutesi,’ liar. A terrible name to call anyone. Let me start at the beginning of that name. On the material day I was at home, alone. The rest had gone to the cassava field. Then, I heard some whispers. I tiptoed towards the source of the low voices. The soft voices led me to the bathroom, some metres from the house. The bathroom was built of reeds and grass. Slowly very slowly and as silently as I could, I made a slit in the grass barrier and waited. I shut one

eye and bit by bit, peeped with the other eye. What I saw did not in the least make any sense. I made out two adults. A man and woman. The man, that balding head, the predictable smell of dry, leaf tobacco… evidently Muzembe. The eye roved and probed. No water basin. Uncle Muzembe and the woman were both dressed! It did not make sense. What game were they up to? Who was the woman? Gingerly, I peeped some more. She was of medium stature. That meant the woman was neither of his wives.

her… his face twisted with a distant look. The deep breath that followed in succession was that of a man carrying a heavy load. I shut both eyes and waited. I debated within. Must I go back to the house or stay? Leave, not yet. First, I should solve the puzzle: who was the woman? I peeped again. Then my eye caught the ‘chitenge.’ Where did I see that ‘chitenge’ – that long, loose outer wrapper? I could swear, only one woman in the village had that green ‘chitenge.’ The headman’s wife!

Muzembe’s lips were as dry as those of a much starved beast in the wild. “Please…I uh huh… please…uh..,” Muzembe mumbled in a bizarre language. In slow motion, I saw the poor woman go on all four, like an animal. Her bottom up. Muzembe awkwardly shuffled towards africa global gateway

| 35


eychelles and Mauritius are two countries in Africa used as tax havens or offshore financial centres.

These are countries or places with low or no corporate taxes that allow outsiders to easily set up businesses, according to the International Consortium of Investigative Journalists (ICIJ) which remained committed to exposing those who exploit tax havens. Tax havens attract foreign investors – individuals and businesses – by offering low or no taxation rates. These countries are typically known for sharing limited or no financial information with foreign tax authorities. These countries are sometimes also called secrecy jurisdictions, while some other countries throughout the world have cleaned their act under international pressure, it is reported that countries like Dubai are emerging as new hotspots of illicit wealth. Early in May 2020, the European Commission (EC) listed Mauritius as a highrisk country for money laundering in the African continent.

36 | africa global gateway

tax havens

Mauritius was among other African countries included on the revised EC list including Botswana, Ghana, and Zimbabwe. In these countries, wealthy individuals often hold money within shell companies and anonymous entities. An Amsterdam-based research group that investigates global networks of corporate control, CORPNET initially published a scientific report. The report ranked 24 offshore financial centres which indicates how much more money comes into the country than how much should come in based on the size of its economy. Featured at 11 on the top 15 list of tax haven countries in the world published by CORPNET, it is indicated the Mauritius has encouraged foreign investment since the late 1980s and early 1990s, when it enacted the Mauritius Offshore Business Activity Act.

The Act which allowed the incorporation of foreign entities with little financial disclosures and extremely low taxation. Island nations like the British Virgin Islands,

Samoa and Malta are some of the top tax havens in the world.

According to OXFAM International, the European Union which initial released a ‘tax haven’ blacklist first published in 2015 and continuously updated, calls out countries in order to improve global tax governance and fight tax fraud, evasion, and avoidance. This blacklist pressures nations to make changes and reforms to their tax codes, and blacklisted countries are likely to face sanctions from the EU. Mauritius may still be a developing country compared to the UK, Australia or New Zealand but it offers sound infrastructure, free public education to its residents and reliable private and public healthcare facilities. The number of South Africans leaving the country on a permanent basis has increased exponentially and many are opting for the island life in Mauritius, not only for its beauty, but certainly for greater financial and tax security.. v

By Thelma Ngoma-Mavhunga

when women lead There is a growing number of female entrepreneurs across the world as more and more women take up leadership positions.


recent study by Visa indicates that women power economies around the world and are increasingly a driving force in the creation of new businesses. The report further states that “the global rate of female entrepreneurship has been increasing more quickly than that of male entrepreneurs, with more than 163 million women around the world starting a business since 2014”. This is an incredible feat for females who have previously been marginalised in management or leadership positions. The rise of the female moves the needle forward in terms of empowerment and equality. Interestingly, Goldman Sachs Group recently found that companies that have a higher presence of female executives outperform in their sectors. Where gender equity is being prioritised, this has translated to a boost in business performance and investors are smiling all the way to the bank.

The issue of gender equality has long been an issue of contention. However, when the COVID-19 pandemic unexpectedly halted most business activity, it also exposed the inequalities that exist in social, political, and economic systems in South Africa and beyond and the role that women can play in helping society evolve. Concerningly, PwC’s Executive directors: Practices and Remuneration Trends Report indicates that the gender pay gap between male and female executives in 2020 is “wider for large-cap JSE listed companies”. However, it varies from industry to industry with some industries having a stark gap, ranging from a 7% in financials sector to others with a hefty gap of 34% in the real estate industry. I believe that we need to do better as a society in not only recognising the important role of women in society but also in the significance of gender equity. As companies re-strategize to recover from this tumultuous 2020, these are the issues that need to be brought to the fore. Let us highlight the overlooked issues and be catalysts for change for the empowerment of all South African women. v africa global gateway

| 37


eauty and skin care regimes have become synonymous with self-care routines across the world. As businesses and the global economy came to a halt earlier this year, serial entrepreneur Cleo Johnson decided to tap into this trend and take the bold step of starting a business in the midst of a pandemic. The end result was a high-end online beauty store, Koko Kollection, retailing skin care potions and fitted clothes to both men and women. With a background in hospitality and marketing, Johnson used her expertise to market unique skincare solutions, natural deodorants, and tailored clothes to a captured audience. This bodes well for the business that has since attracted the attention of many consumers across the country and beyond. When asked about her booming business that is taking off despite the global pandemic, Johnson said that every entrepreneur or leader at some point reaches a ‘fork in the road’ moment that ultimately determines where they will end up. “As the owner of a marketing and hospitality consultancy company dubbed Nuecleo, the pandemic completely shut down all avenues of revenue in the beginning of the year. I had many plans to grow my business and become a global consultancy firm, but circumstances changed at the drop of a hat. I reached my ‘fork in the road’ moment when I realised my business would have to be on hold indefinitely. This led me to the decision of pivoting the business and shifting strategies to start a new business and tap into a brand-new market,” says Johnson. Over the past few months, Koko Kollection has since caught the attention of several natural skin product fanatics who rave about her company’s natural deodorants, candles, skincare potions and unique apparel. “In a space of a few months, we have truly captured the hearts of our consumers and have also managed to inspire some along the way,” continued Johnson. She further encourages those who were impacted by the pandemic to not be afraid to start over. “As the human race, we have endless creativity, it is crucial that we use our creativity to reimagine a new reality for ourselves. Covid-19 has impacted the global economy significantly, but it has also given us time to re-evaluate, pivot and realign our visions. At Koko Kollection, we will continue to inspire, push the boundaries, and strive to empower our customers through providing products that allow women (and men) to practise self-care and achieve balance. v 38 | africa global gateway

young entrepreneur bravely opens a new business during pandemic By Thelma Ngoma-Mavhunga

angola – lourenço’s

reforms are paving the way By Sinethemba Zonke for a brighter future The ascension of João Lourenço to the President of Angola was quite a surprise to many observers of the country. This was mainly as a result of the decision by José Eduardo dos Santos, who had been Angola’s strongman for 38 years, to hand over the reins.


he former President had ruled over Africa’s secondlargest oil producers with an iron grip. His position as head of the state allowed his family to build one of Africa’s most enormous fortunes. His Daughter Isabel went on to attain the status of Africa’s richest women. With President dos Santos having to create such an integrated relationship between his family fortune and the Angolan state, it did not appear that he would give power to anyone else especially someone outside the dos Santos family. However, in 2017 Lourenço emerged as the leader who would begin a new era for Angola, one that has started to detach itself from the family of its previous President. President João Lourenço came into power with a promise of initiating a crusade against corruption in Angola. The country has been plagued with massive inequalities between the politically connected and the average citizens, where poverty is still high. While Angola benefitted from its oil wealth, the impact of lower oil prices devasted the state that was heavily depended on the fossil fuel for governments revenues. Corruption had also made the attractiveness of Angola as an investment destination a lot dimmer compared to prospects in other areas of the country. For Lourenço, changing the image that had tarnished Angola has been crucial for him to secure a legacy separated from his predecessor. The incumbent President of Angola has not shied away from criticising the former President Jose dos Santos. His moves to remove the dos Santos children from the Angola patronage networks has brought in significant confidence and legitimacy to the fight against corruption. Dozens of officials in Angola have been removed from their positions, indicted and charged with corruption. 40 | africa global gateway

As he has consolidated his power over the Angolan state and the ruling party, the MPLA, Lourenço has been able to introduce some long-needed reforms to Angola’s economic landscape. The President has begun to bring some transparency in the oil sector by fixing the murky process of selling oil concessions. By unpegging the kwanza from the US dollar, this has helped relieve pressure on the nation’s foreign reserves. There have been moves to privatise several state-owned companies. João Lourenço has tightened up banking regulations and ordered the central bank to auction dollars to everyone interested, instead of a select few as had been in the previous regime. João Lourenço has received praise locally and internationally for his reforms and fights against corruption. The changes in macroeconomic policy have worked to reassure foreign investors. The President has been awarded for his initial reforms by the International Monetary Fund (IMF) which granted Angola, a $3.7 billion loan to assist with the reforms.

Angola is seeking to diversify away from the oil sector, and privatisation will be a crucial strategy to achieve this. The privatisation of public sector companies is being done with a mandate from the Privatisation Framework Law. As part of the framework, 195 companies were shortlisted for privatisation between 2019 and 2022. Angola wants to divest from its wholly state-owned and partially stateowned companies and sell these assets by 2022. Two companies on the chopping block for privatisation include insurance company ENSA, and the Banco Bai, where the state has indirect holdings. The reforms have started to bear fruits for the aims of diversification. The country’s untapped mineral wealth has garnered interested from international mining companies. In October 2020, President João Lourenço announced that Anglo-American had signed contracts for prospecting and exploration of silver, africa global gateway

| 41

copper, nickel and platinum. Also in October 2020, a mobile phone assembly plant started its operations in the Luanda-Bengo Special Economic Zone (SEZ). The plant consists of three parts, offices, manufacturing area and storage facilities. It is reported that it can produce 100,000 devices a year. The plant has been realised because of a $2 billion line of credit from the United Arab Emirates (UAE). The Angolan oil industry has been lucky when it comes to the global covid-19 pandemic. Angolan large-scale projects were not cancelled, as has been the case in some of its oil and gas counterparts. The country has worked to maintain oil production, and will likely reach 1.4 million barrels per day (BPD) as was expected before Covid-19. With the majority of its operations being offshore, Angola has been able to implement restrictions to deal with the coronavirus outbreak that have been less harsh than in other countries. Angola has been ranked by Rand Merchant Bank (RMB) as being the second most attractive country in Africa for retail investments. This is after Nigeria at number one and ahead of countries such as Ethiopia (rank 4), Kenya (rank 6) and Algeria (rank 10). The retail sector in Angola is still at its nascent stages, with the industry having receded quite substantially since 2014 because of a slowdown in the oil sector. However, local investors have seen opportunity in the market which has spurred the expansion of mall operator, Xyami. Luanda now has 14 shopping centres. Agriculture is another area with huge potential. Before the nineties, Angola was a significant producer and exporter of agricultural products, including sugarcane and coffee. As a result of the civil war, and the oil dependency Angola has been a net importer of agriculture. However, local agricultural production has started to increase aided by private investments which have the potential to facilitate the diversification of the economy. Angola has geographical advantages with an abundance of water and large areas of arable land, which make it an excellent investment for agriculture. President João Lourenço made an ambitious declaration in 2020, that Angola wants to be an African agricultural powerhouse.

42 | africa global gateway

With João Lourenço at the helm and his stringent measures at reform, Angola can get back on its path of being an African economic giant. The oil industry will remain a critical part of the growth strategy; however, with a more business-friendly outlook and an industry free of the grips of political patronage, the oil industry can act as the catalyst for growth and diversification across the Angolan economy. The privatisation drive will hopefully send a strong signal to investors across Africa and the world that Angola is open for business. v

east africa

- africa’s growth engine By Sinethemba Zonke

The fastest-growing region in Africa remains the East African region. The economic region has also had some of the fastestgrowing economies in the world for some year. It has also been a region that has shown a penchant for innovation and growth that is not overly reliant on natural resources.


n recent years, findings of large-scale oil and gas reserves in the region have seen a flood of international investors planting their flags in the region. East Africa has also become an essential point for China’s Belt and Road initiative. The region received 27% of the Foreign Direct Investment (FDI) projects in 2019. The attractiveness of the region has been helped not only be discoveries of oil and gas but improvements in the business environment and successful regional integration initiatives. Ethiopia has, for example, started to remove its strict prohibitions on foreign ownership in critical sectors. The government sees the benefits of external funding and is looking at opening up the telecommunications and power sectors to private investments. While Africa has seen an energisation around talks of economic integration, with the signing of the African Continental Free Trade Area (ACFTA) it has been East Africa which has been a leader amongst the regional economic communities

(REC) in terms of integration. The ACFTA also has come about under the leadership of an East African President, Rwanda’s Paul Kagame, who led a strident push for the adoption of the agreement. The East African region is boosted by having the most successful REC in the East African Community (EAC). The EAC is a bloc with 177 million people with a combined GDP of $267 billion. It s comprised of two middle-income countries (Kenya and Tanzania), and four low-income states (Burundi, Rwanda, South Sudan and Uganda). Having excepted South Sudan as its newest member in 2016, the EAC has also attracted the interests of the Democratic Republic of Congo which wants to join the bloc. The EAC is not without its problems, and there is some rivalry and jockeying for supremacy amongst the countries, however, it has thrived much better than other integration experiments on the continent. The bloc is also advantaged by having the three nations of Kenya, Tanzania and Uganda being strongly homogenous linguistically through Kiswahili the most widely spoken language in Africa. The International Monetary Fund (IMF) has projected that only 16 countries out of 194 would grow at 1% or above in 2020. This reflects the devastating impact of the global coronavirus impact.

africa global gateway

| 43

In East Africa, several nations belong to this group of sixteen. Growth rates in 2020 are expected to be 4.11% for South Sudan, 1.99% for Rwanda, 1.95% for Ethiopia and 1.9% for Tanzania. The growth rate for the region was predicted to slow down to 1.2% as a result of Covid-19 down from the earlier projected 5%. However, it is expected that growth in the region will rebound to 3.7% in 2021. The East African region has seen an exciting transition from mainly being agricultural economy towards services, a vital sign of economic advancement. This growth in services has been most prominent in Eritrea, Kenya, Rwanda and the Seychelles where the sector contributes 67%, 60%, 47% and 80% to GDP respectively. There is however, a need for the East African countries to move into higher value-added services. Higher value-added activities will ensure robust development in the region leading to improvement in the quality of life for the people of these countries. There have been mega-projects investments in the East African region as a result of new resource discoveries as well as the strategic location of the region. There have been many infrastructure projects focused on energy and transportation. The port country of Djibouti and Ethiopia have collaborated in a standard railway line and oil pipelines. The railway line from Addis Ababa to Djibouti has opened up a significant exporting opportunity for Ethiopia, a landlocked nation of 110 million. Tanzania and Kenya have both invested in standard railway lines, while 44 | africa global gateway

Rwanda has invested in a new international airport. Tanzania has a $30 billion LNG export project that is being constructed by Shell, Exxon amongst others, in collaboration with the Tanzanian Petroleum Development Corporation. The region is poised to be an export hub, well placed in the intersection between Europe, the middle east and the farther regions of a growing Asiatic economy, led by China. Many of the projects mentioned above are funded as part of the Belt and Road initiative.

the east african region has seen an exciting transition from mainly being agricultural economy towards services, a vital sign of economic advancement .

The East African region is performing very well considering that it is one region in African with a high number of countries facing security risks from internal political dynamics, intra-state conflicts and from non-state actors such as terrorist groups. This indicates that the potential of the region is quite immense; it will be a lynchpin of Africa’s growth when it can resolve its security challenges. The economic performance of South Sudan deserves recognition, and the country is poised for good performance in 2021 compared to the rest of the world. Growth in South Sudan would likely drop by 2.27% in 2021; however, it is projected to have growth rates of 2.98% in 2023, 5.42% in 2024 and 5.49% in 2025. While Covid-19 will have its negative impact on the fundamentals that worked well for the East African region will fall back into place as the crisis fades. Coordination by the EAC is likely to assist in boosting growth, with the REC working on promoting the regional community as one single tourist destination as part of a recovery plan. There are plans to offer special tour packages that will apply across the region covering airfare, popular attractions and accommodation. Investors looking at the East African region

have plenty of option and will benefit from the diverse opportunities offered. Kenya (rank 4), Ethiopia (rank 8) and Rwanda (rank 9) made into Rand Merchant Bank’s 2020 Attractiveness report top ten destinations. In terms of retail attractiveness Uganda, Ethiopia, Kenya and Tanzania ranked at 3, 4, 6 and 9 respectively. With a population of 40 million, Uganda has great demographic potential. It is expected that growth rates will average at around 6% up t 2024, with the population and urbanisation growing at 3% and 2.3% respectively. Kenya has one of the most

competitive retail sectors in the region, and it has the highest consumer spending in East Africa. The country’s ICT innovation supports retail in Kenya. Local retailers dominate in Rwanda, but there is an increasing presence of Kenyan and South African chains. Ethiopia is a country with a tremendous comparative advantage when it comes to labour costs, with the country being close to parity with Bangladesh and India. This puts Ethiopia in a leading position to benefit from jobs that move away from China because of rising wages. Kenya, Tanzania and Ethiopia have special economic zones that are focused on textiles and agro-processing, which will be necessary for developing the regions manufacturing capacity. v africa global gateway

| 45


covid-19 and the economy

Studies done by a number of scholars such as Nicola Cantore and many others, have findings showing that the direct costs of the COVID-19 pandemic associated with illness and mortality are lower than the indirect losses caused by the crisis.


he COVID-19 pandemic has had more impact on world economies than it has had on health. Since 2019 to 2020, there has been a low number of death due to the pandemic, but a low impact of COVID-19 in terms of case numbers and deaths does not necessarily translate into a low economic impact. Many countries are experiencing a recession, even though COVID-19 has not had a serious effect on them in terms of health. Many countries are experiencing a recession, even though COVID-19 has not had a serious effect on them in terms of health. The impact of the COVID-19 pandemic has been felt world over with Africa inclusive and being part of Africa, Zimbabwe has not been an exception. Zimbabwe has been facing an economic crisis, further worsened by COVID-19 (coronavirus) pandemic. In 2019, before the Corona virus, Zimbabwe was hit by severe drought and Cyclone Idai that coupled with shortages of foreign currency led to double-digit contraction of agriculture, electricity, and water production and pushed more than half of the population into food insecurity. Zimbabwe’s economic crisis has existed way before the corona virus and the other misfortunate turn out of events. Zimbabwe is said to be one of the countries with a high literacy rate in the world. The main purpose of education is supposedly to empower individuals and society with the capacity to solve their problems, continuously improve their lives and overcome what to the less educated societies is insurmountable. For a country regarded as one with probably the highest literacy africa global gateway

| 47

levels on the continent to be entangled in a devastating economic situation for close to 20 years is a big misnomer, if not a slap in the face of education. As a result of the declaration by the World Health Organization of COVID-19 as a global pandemic, a state of disaster was declared in Zimbabwe on the 20th of March 2020. The Zimbabwe state believe combatting the Pandemic will help then to recover their economy. It is to this background that a National Lockdown and prohibition of gatherings was legislated for the 21 day period commending 30 March 2020. The lockdown was at a later point revised from 22 July 2020 with 18.00 to 06.00 curfew being implemented and business operations for non-essential services, low risk sports and permitted gatherings being restricted to times between 09.00 and 15.00. In addition to the lockdown, several tax measures have been but in place in Zimbabwe as a result of the COVID-19 outbreak in order to keep up with economic growth. Online filing was expanded for tax payers in order to reduce mobility. To stress further, ZIMRA would endeavor to process all VAT refunds within 30 days provided certain criteria are adhered to by taxpayers. There had been amendments to the employment tax rates with increase in tax free threshold from ZWL2, 000 to ZWL5, 000 per month and the highest tax band at the rate of 40% on income over ZWL100, 000 per month effective 1 August 2020.

48 | africa global gateway

The reserve bank of Zimbabwe also met and made their own amendments. They deliberated on a number of issues including the impact of Covid-19 on the economy and the necessary policy interventions to ensure that the economy remains on a growth trajectory. As a way of keeping the economy growing, they made a number of policies and resolutions. To begin with, The Bank Policy rate will be reviewed downwards from 25% to 15% per annum with effect from Friday, 1 May 2020. The belief was that all banks would do the same and provide affordable financial facilities to their customers during these challenging times. Among many others, the interest rate applicable to the Medium-Term Bank Accommodation (MBA) Facility will be reduced from the current 15% to 10% per annum. On the road map to economic recovery, it is said that the services sector is likely to continue to dominate the Zimbabwean economy. The recovery of infrastructure services along the lines, financial services, tourism, and community services, would ensure that the sector continues to be an important source of growth and employment creation in Zimbabwe going forward. To accelerate growth and reduce poverty, Zimbabwe must address the limitations it faces in promoting the efficient use of resources and in raising productivity. v

the recovery of infrastructure services along the lines of financial services, tourism, and community services, would ensure that the sector continues to be an important source of growth and employment...

Key development goals for african tourism facts and figures courtesy of the un world toursim organisation (wto) Across the globe, Tourism has evolved as one of the most expansive and diverse sectors of our times. Now representing one of the largest and fastest growing economic sectors in the world, Tourism contributing 9% of global GDP. Importantly, supporting the livelihoods of 1 in 11 people worldwide, the sector has become a source of immense opportunity and possibility.


estinations recognising the ability of the sector to transform nations economically, socially and environmentally, and therefore investing in the sector, have enjoyed significant progress, thus demonstrating tourism’s role as an essential tool leading to the development, prosperity and well-being of a country´s economy. In Africa, Tourism continues to enjoy sustained growth. In 2014, the continent welcomed 56 million international tourists from 26 million in 2000. International tourism receipts increased by US$ 1 billion in 2018, reaching US$ 36 billion and accounting to 7% of all exports in the continent. The African 50 | africa global gateway

continent is truly adorned with a rich diversity, an abundance of untouched resources, natural beauty, cultural heritage and historical sites, wildlife, safaris, beaches, deserts and much more that, if channelled correctly, could provide considerable opportunities for cultural tourism, ecotourism, adventure tourism and diaspora tourism. Looking to the future and the potential of Tourism on the continent, UNWTO forecasts shows that by 2030 the number of international arrivals in Africa is expected increase by more than a double, growing from 50 million to 134 million, increasing the global market shares of Africa to 7%. Central to unlocking the potential of Tourism in Africa is the joining of hands of partners that share a fundamental confidence in, and commitment to, Tourism on the continent. Africa’s Tourism - Current Situation and Future Prospects Africa has been one of the world´s fastest growing tourism regions, growing a small base

of just 14.7 million visitors in 1990, to 26 million international tourists in 2000 and 56 million in 2014. International tourist arrivals in Africa are estimated to have increased by 2% in 2014. Africa’s current 2% rise however represents a clear slowdown on tourism demand after years of solid growth. International tourism receipts (+3%) increased by US$ 1 billion to reach US$ 36 billion. The region maintained a 5% share in worldwide arrivals and a 3% share in tourism receipts. In North Africa, international tourist arrivals in leading destination Morocco grew by a modest 2%, following a strong performance in the previous year, while arrivals in Tunisia decreased by 3%. Sub-Saharan Africa grew by an estimated 3% in 2014, based on available information

Tourism product development is not an activity undertaken in a vacuum but is part of an extensive and inter-related process. Market research, product development and marketing represent a continuum. The failure to deliver any of these key components will result in the destination under-realizing its potential.

Arrivals to the sub region’s largest destination South Africa (+0%) were flat in 2014. Worth mentioning among the other destinations for which data is reported are Côte d’Ivoire (+24%), Madagascar (+13%), Mauritius (+5%), Zimbabwe (+3%) and the Seychelles (+1%). While many countries in Africa benefited from strong economic growth in their tourism sector, the continent´s share of worldwide tourism receipts is relatively modest. Tourism creates jobs and stimulates SME (Small and Medium Sized Enterprise) growth. In 2014 it represented 9% of world GDP - direct, indirect and induced impact. Tourism is one of the fastest growing sectors of the world economy. International tourism has shown almost uninterrupted growth since the 1950s and has almost doubled over the past decade. Tourism shows particular promise for developing countries. Tourism is growing faster in the world’s emerging and developing regions than in the rest of the world. Tourism accelerates reform. Tourism is a beacon for pro-business policies and reforms that can help SME development and stimulate foreign investment. Tourism product development – key concepts and destination context Tourism product development is a process whereby the assets of a particular destination are molded to meet the needs of national and international customers. The tourism product can include natural or man-made attractions, hotels, resorts, restaurants, theaters, activities, festivals and events or a portfolio of things for visitors to see and do.

As tourism provides opportunities for SMEs (small and medium enterprises) many governments provide incentives to encourage the tourism product development. Some attractions or facilities are included in tourism development policies with plans increasingly geared to meet specific socioeconomic objectives. These objectives can be as varied as attracting inward foreign investment, generating local level economic impacts in the form of SMEs and/or community tourism, boosting economic development in certain regions of the destination or reducing the seasonal imbalance to minimizing damaging environmental or socio-cultural impacts on the destination and its resident population. Another significant reason why destination authorities support tourism product development is to improve the provision of facilities so that the local population can also enjoy, thereby improving their quality of life. A methodology for tourism product development in Africa There are certain key principles in the process of tourism product development planning that can be illustrated through what might be called ‘a model destination’. This may not relate to any specific destination but is drawn in such a way that many destinations can share some, if not several of the characteristics which might define the model. Tourism product development does not start from nothing as destinations have existing institutional infrastructure, plans, policies and procedures which development in the tourism sector can fit, however there are limitations in financial resources and intellectual capabilities. All projects derived from this Prototype methodology under UNWTO are required to comply with the Global Code of Ethics for Tourism to maximize tourism’s socioeconomic contribution while minimizing its possible negative impacts. In respect to the methodological approach, it follows a 5-phase

approach, with a series of activities. Recommendations Tourism is one of the key industries driving the change in the continent of Africa and it provides multiple opportunities for economic growth and improved livelihoods. Among the reasons to develop tourism we can find the creation of jobs, regional economic development, improvement of infrastructure, increasing domestic consumption and exports diversification, cultural heritage and environmental preservation, empowerment of women, the youth and marginalized people, amongst others. Africa’s private sector is increasingly attracting investment, with much of the funding coming from Europe and the United States of America. Returns to investment in Africa are among the highest in the world. To explore these opportunities, it is essential that African countries adopt clear strategies based on suitable methodologies for tourism product development. There are some basic principles which serve as a basis for tourism product development. These are recommendations which can be implemented to help ensure successful development and mitigate risks of developing products which is unsuitable to the target market or even worse draws the wrong target market: • Understanding market tastes and trends • Market research • Market: product ‘matching’ • Designating tourism development areas/ zones • Undertaking extensive stakeholder consultation including with the local communities in the areas of development in an open manner and in a spirit of cooperation • Pursuing flagship development opportunities • Identifying opportunities for clusters, circuits, and events • Preparing a full product portfolio and investment plan • Ensuring that personnel with the appropriate tourism technical skills are in place at national, regional and local levels to carry the process of tourism product development forward; and • Drawing up a marketing and promotion strategy to support the tourism product developments, and implement a program of marketing communications. v africa global gateway

| 51

the new mooiKloof mega city in pretoria The new Mooikloof Mega City project in the east of Pretoria, is set to become South Africa’s largest sectional title property development with some 50,000 apartments being planned.


residential project by Balwin Properties is the group’s biggest housing project to date. The initial 16 000 apartments valued at about R9,6 billion will be built in phases over the next few years and unit prices would range from R499 000 to R799 000. This development located in one of the most sought-after addresses in the capital city will be extensively redeveloped with units to be extended to 50, 000 apartments at the total value of R44billion. Built in a strategic location, Mooikloof Mega City is located off Garsfontein Drive and is approximately 6km from the junction with De Villebois Mareuil Drive where Woodlands Boulevard Mall is located and 8km from Solomon Mahlangu Drive which gives access to the N4 and other main arterial routes. Surrounding developments include Woodhill Golf Estate, Mooikloof Equestrian Estate, Mooikloof Heights, Mooikloof Ridge, The Hills 54 | africa global gateway

Golf Estate, Grootfontein Country Estate and Mooikloof Glen. Mooikloof Mega City has been designed specifically for the gap housing market defined as housing opportunities for people earning a combined monthly income of between R3501 and R18000. Launched by President Cyril Ramaphosa in October last year, the project has an estimated value of over R84 billion and is expected to boost the economy and create about 115 000 direct and indirect job opportunities. The public-private partnership development seeks to assist people who earn too much to qualify for fully subsidised housing but who don’t earn enough to afford debt-financed housing in areas of their choice. National Treasury has also recently signed a Memorandum of Agreement with the Development Bank of South Africa in terms of which a R100 billion infrastructure fund will be available to facilitate infrastructure development in South Africa. Potential homeowners will also be able

to apply for assistance from government’s Finance Linked Individual Subsidy Programme (FLISP). This development is reportedly designed by Boogertman + Partners Architects which has extensively worked with Balwin in the past. The development is designed according to Balwin’s Green model, which includes the developer’s new Greenbarn Lifestyle Centre. Mooikloof Mega City is Edge-certified by the Green Building Council of South Africa. This Mega City development was designated by the Presidential Infrastructure Coordinating Council as a Strategic Integrated Project (SIP) in terms of legislation gazetted in July 2020. Government, through the Department of Public Works, will earmark R1.4 billion for all external bulk services installations such as water, sewer, electricity, storm water, and road to be implemented by Balwin. v

despite debt problems, zambia’s core sectors hold excellent growth potential By Sinethemba Zonke


he coronavirus has been more than just a health crisis around the world. It has been an economic disaster which is likely going to require an extended period for recovery for many countries. The shutting down of economies around the world has destroyed businesses, with small companies being wiped out entirely from existence while larger corporations have been left limping. Only a few industries have been able to withstand the crisis,

58 | africa global gateway

many of these being ones that have been ahead of the curve in adopting digitalisation as a critical component of their business operations. The economic impact of the Covid-19 crisis on Africa has been particularly acute despite the continent having some of the lowest infection rates across countries. The effect is instead a reflection of how deeply connected the region is to the rest of the

world. One industry that has borne the brunt of the impact of travel restrictions has been the tourism sectors, a sector that has the best potential for job creation and growth for the continent’s economies. Zambia, which has been in the throes of a potential debt crisis for a few years, was projected to grow by 2% in 2021, after a 4.1% contraction in 2020. The mining and ICT sectors have shown resilience as they

registered growth in the second quarter of 2020, despite a 2.1% contraction for the rest of the economy during the quarter. As an enabler of economic activity even during this period of lock-down, the ICT sector led the pack of resilient industries. The industry has allowed teleworking and tele-socialisation during this challenging period. The mining industry, which is dominated by copper saw a resurgence, with copper miners seeing a 2.8% growth in their exports in the second quarter. This was due to a surge in copper prices. Other industries that showed growth under the covid crisis included financial services and agriculture. Agriculture has played an essential role as a supplier of essentials from the back of good rainfall. Zambia’s debt picture is a significant concern for both local and foreign stakeholders. The growing debt has been blamed on bad fiscal management. The Southern African nation may be the first Africa country to default on its bond obligations. International investors could view Zambia as a harbinger of what may happen in other African nations dealing with high debt levels. The country was estimated to be in arrears of $485 million in foreign debt, which included a mix of $183 million from bilateral lenders and $256 million from commercial lenders. Zambia has had a fractious relationship with the International Monetary Fund (IMF) over its burgeoning debt and fiscal policy over the past few years. Most recently the IMF and Zambia have been working hard to mend this relationship, with the financial institution appointing a new resident representative, Preya Sharma. The new appointment may likely give confidence to Eurobond holders in the credibility of Zambia’s economic reform agenda. Zambia may be able to fend off a debt default as the world recovers from the covid-19 crisis, with copper being one of the primary beneficiaries as its prices surge. Copper demand is driven by the growth of the Chinese economy as well as the future of automobiles, which is leaning towards electric car production. With many countries including those in the European Union, China and India making plans to have a majority of their cars being electric

vehicles, Zambia’s main export commodity will aid the country’s future economic prospects. It has is projected that copper prices will continue to rise as electric cars become the norm. For years the copper depended nation has been speaking about strategies of diversifying from the metal which leaves it highly vulnerable to external shocks. This has not yet come to fruition; however, there are promising industries that could shoulder the economic growth of the country. Zambia has great mineral potential beyond copper, with the nation having some solid gemstone prospects. Also, recently the country has developed a strategy for not only the gem sector but a gold sector which has attained international investor interest. The Zambian government’s strategy on gemstone and gold strategy is aimed at diversifying the country’s exports. The strategy seeks to bring about more formality in the industry which has a significant proportion of informal artisanal and small-scale miners. There are plans to set up gold processing plants as well as trading centres. There have already been ten milling plants that have been built. Earlier in 2020, the state-owned mining investment company ZCCM Investments Holdings (ZCCM-IH) entered into a joint venture with Array Metals, a USA based resources firm. The joint venture will be in a project that will process gold from Mumbwa, west of Lusaka. The project is optimist that it will be producing three tonnes of gold within the next two years, which is valued at $150 million at gold prices during May 2020. While the Zambian economy has a picture of doom and gloom as a result of its debt as well as some political challenges, the four sectors of ICT, mining, financial services and agriculture have revealed their importance as critical pillars for future economic development and growth. Agriculture, in particular, can play a massive role in centring Zambia as a leading exporter in a much more integrated Africa, once the AFCTA comes into fruition. The future of the country will be determined by various factors, much of them external since the nation is heavily dependent on commodities. However, the internal aspects of politics and governance will be critical for Zambia to realise its full potential as a possible resource export hub for Africa. In 2021, President Edgar Lungu will run for elections again as presidential nominee for the Patriotic Front (PF). Whoever wins next year’s elections will have the power in their hands to improve the business environment of Zambia, that will allow the core pillars of the economy to aid the country’s development, diversification, and growth. An election that is seen as legitimate will improve relations with Zambia’s international partners opening the way for growing investment and support from its partners in the western world. With good relations with its partners, Zambia can surmount its debt challenges. v africa global gateway

| 59

African agriculture

builds resilience against climate change As the climate catastrophe rears its ugly head in Africa, we can expect more incidents of extreme weather such as drought, floods and locusts to wreak havoc on crops, deepening existing food security concerns. Despite the heavy hand dealt, more African agrarians are finding resilience in climate-smart agriculture as well as the adoption of agritech.


echnology remains one of the most useful tools for African countries to develop their agriculture and protect it from the devastating impact of climate change. With up to 70% of African livelihoods dependent on agriculture, equipping farming communities with the latest in artificial intelligence, computing and big data tools will improve productivity and sustainability in agriculture. The use of big data and artificial intelligence in agriculture is used to monitor soil and climate variations giving farmers information that helps them make better decisions. Farmers use the information derived through smart technology to know when, where and how much to plant. Some critical technology programmes in Africa that have aided agriculture include Kenya’s SunCulture and Nigeria’s Risk Sharing System for Agricultural Lending (NIRSAL). SunCulture uses solar-powered irrigation systems to improve crop yields. SunCulture has also made use of TV white space (TVWS) technology to improve access to high-speed internet access in remote areas. 60 | africa global gateway

Another innovative method that can aid in making agriculture more resilient is biotechnology. Professor Bamidele Solomon of the Abuja based National Biotechnology Development Agency (NBDA) says that biotechnology can make plants more drought-tolerant, which is critical as the planet is likely to experience more droughts as the climate crisis worsens. Professor Solomon says “Drought tolerant traits reduce the demand on water for plants to grow and thrive”. Biotechnologies that have been introduced in the region have also been aimed at the diversification of the plants that are often planted. A lot of African countries monoculture focused, which leaves them more exposed to market and weather risks. Through biotechnologies, African farmers can improve their crop varieties. It has become apparent that gender equality is vital for the region as it faces climate change. As women present the largest group of workers in the agricultural sector, supporting the is often the first line of defence against any climate-related risks and dangers. Fortunately, a lot has been done by international NGOs, development agencies and the private sector in funding women-run projects across Africa as well as making sure that women have the security of tenure in the lands that they work. Women have benefited from support from groups like Standard Bank collaborating with the United Nations Entity for Gender Equality and Empowerment of Women (UN Women). UN Women and Standard Bank have initiated a programme that will

empower 50,000 women in Malawi, Nigeria and South Africa. These women will be provided with modern and environmentally friendly technologies. These technologies are designed to increase the productivity and incomes of these women. Through the programme, 6,000 women in Malawi received support by being given high-yield droughtresistant ground-nut seeds. Women have also been trained in modern farming methods that conserve moisture and maximise land usage. The need to support African agriculture and the potential economic benefits from this have been highlighted by the continued investment by impact investors in the region during the Covid-19 crisis. Impact investing has become more prominent around the world as the topic of sustainability has risen in importance in boardrooms and governments. Impact investors are not merely interested in the old business model of profits but integrate environmental, social and governance indicators as critical measures of sustainability in their investments. Impact investment has been supported by development agencies

such as the CDC and DFID from the UK, GiZ from Germany and the USA’s International Development Finance Corp. Impact investors have been channelling funds to African start-ups that are focused on agriculture. These are start-ups who have played a key role in maintaining food supply across the continent, particularly during times of massive disruption as has been the experience in 2020. There is still a lot more funding required

for Africa’s agricultural ventures. The worldwide agri-foodtech sector received about $20 billion in venture capital in 2019. Of this $20 billion Africa got $282 million. As development partners and local private sector companies expand their role in funding small-scale agriculture on the continent, interests from venture capitalists and impact investors will grow. While many agribusinesses in Africa are small-scale, this could prove an advantage through the use of technologies that can maximise the use of land. v africa global gateway

| 61


the for africa Africa’s energy deficit has been one of the most discussed issues around the development trajectory of the continent. It is not a lack of technology that is a hindrance to Africa. The challenge has been infrastructure, financing and a proper set of economic policies. Fortunately, Africa’s leaders have been making some significant strides in dealing with the challenges. Global actors, such as China and the United States of America (USA); who understand the potential of Africa in the shifting global balance of power; have shown an interest in investing in Africa’s infrastructure. The USA initiated the Power Africa programme while China has offered lines of credit and technical assistance in building infrastructure.

energy path


ith the power jockeying between world powers, Africa is in a position to benefit through millions of dollars in development support which will be crucial in the economic upliftment of its people. Infrastructure projects, particularly in energy, have become an area of diplomatic play amongst global powers. With the phenomenon of climate change, Africa has also become central to the debate on renewable energy versus fossil fuel energy like coal. As the continent is still behind in its industrial development, some see energy sources like coal as crucial for economic growth; hence several countries have allowed coal plant investments. Africa will need to have a diverse energy mix, which will include substantial amounts of renewable and traditional sources. In terms of being more competitive in the 21st century, and to deal with the risks of climate change, renewable energy is one of the best investments for African countries. Renewable energy is also the most cost-effective method

62 | africa global gateway

for connecting hundreds of millions of people who go without electricity. Renewables are cheaper, longer-lasting alternatives to fossil fuels. Africa has the advantage of geography when it comes to utilising renewable resources such as solar energy with its substantial number of days of sunshine. Across the continent, Africans have mounted hundreds of thousands of solar panels on their roofs. Solar has been attractive because of off-grid potential, which allows people to by-pass the need for expansive and costly infrastructure. Solar photovoltaic (PV) panels are the most ubiquitous source of renewable energy in Africa. To get more reliable electricity communities across the region have installed solar home systems and mini-grids. Solar home systems have become popular in Central, East and West Africa. In 2021 African countries are projected installed 1.2 gigawatts (GW) of energy all of it coming from renewable resources. This capacity does

not include the continents leading energy producer, South Africa. According to the Bloomberg New Energy Finance report, there has been over $2 billion spent on renewable energy projects since 2017, with $2.2 billion in 2017, $2.8 billion in 2018 and $2.1 billion in 2019. Multilateral financial institutions such as the World Bank and the African Development Bank (AfDB) have been critical funders of renewable energy in Africa. The World Bank spent over $11.5 billion on renewable energy and energy efficiency between 2014 and 2018. In Ghana, the World Bank supports a $220 million solar project. The Ghana Energy and Development Access Project (GEDAP) includes renewables such as biomass, geothermal and solar. At the moment, despite have extensive natural resources, including energy resources such as oil, gas and coal; Africa is a net importer of energy. By being more innovative and diversifying their energy mix, especially by growing the contribution of renewables, African countries can increase their energy

independence. For some African countries, such as those in North Africa, the shift to renewables could see them being exporters of renewable energy to the European market. In Africa, the discussion about the transition away from fossil fuels has taken a social justice path, with calls for a ‘just transition’ that will ensure that jobs reliant on the fossil fuels sector can be replaced by similar and better jobs in the renewables space. If this is not done, Africa may find itself once again behind in the competitive economic market. With this reality, it is essential that African lead in taking up the more innovative energy solutions. African should follow in the path of countries such as China and India. Both Asian countries are major coal users but are taking steps into the renewable space, not only as consumers but as producers of the technology. African countries must strategically position themselves within the productive side of renewable energy, especially in the production of high valueadded renewable options. v

africa global gateway

| 63

As Africa has urbanised and its youth demographic has blossomed, the continent has seen a burgeoning of technology hubs in key cities. These hubs have been set up to play a catalyst role in the economic growth of their countries.


here is a strong realisation that many of the problems faced by Africa need homegrown solutions and a lot more innovative. Africa has relied too much on foreign expertise, but with a more educated population and returning members of the diaspora, the continent is starting to have localised problem solvers. Africans, including the youth and the diaspora, have built start-up companies that have been receiving a lot of attention from around the world. Like anywhere else in the world start-ups have struggled with support and funding. In Africa, this has been an exacerbated issue because of the financial circumstances of many countries in the region. Despite the historical scarcity of funding, African start-ups are thriving, and there are more and more platforms being created by the public and private sector to support start-ups. Technology hubs have acted as the lightning rod bring talent, funders and expert advisors into one spot. There are, however, still hurdles to be overcome for African technology hubs to play the pivotal role they are meant to play. A lot of this has to do with the operating environment of many African nations. African countries are at different levels in terms of creating a conducive environment. Rwanda’s government is a leader in Africa in offering a business-friendly environment, and a policy approach that seeks to accelerate technological entrepreneurship. In other African nations, tech entrepreneurs have bloomed despite a challenging operating environment. By investing and

66 | africa global gateway

booming tech hub scene to bolster african growth supporting technology hubs, policymakers in Africa can improve the survival rate of start-ups. In terms, more start-ups will provide more sustainable solutions to the thorniest of problems faced by African countries. There are 643 tech hubs in Africa operating as incubators, accelerators, coworking spaces and innovation hubs. Africa’s largest economy Nigeria has the most hubs with 90, while South Africa, Egypt and Kenya have 78, 56 and 50 hubs, respectively. According to the head of research at Briter Bridges, Lisa With, tech hubs “represent a lot of potential in terms of facilitating growth and creating synergies across the entrepreneurial ecosystem”. Tech hubs are essential for young people who have all the innovative ideas in the world but tend to lack mentors. Hubs can channel youthful energy to be more productive. While funding remains a challenge for many small entrepreneurs in Africa, tech hubs have seen increasing investments. In 2019, African start-ups raised $1.34 billion from venture capital, which is about five times more than was raised in 2017.

This ability to raise money has been spurred on by not only growing appreciation from locals but from interest from foreign players. Microsoft have been funding start-ups on the continent since 2013. Google, through its Launchpad Africa accelerator programme, provides workspace, expert advisors, travel and public relation support to start-ups. In 2017 the internet search giant committed to training ten million Africans on digital skills. Even with the covid-19 crisis, the technology sector has remained resilient. Googles digital skills training offering has more than doubled during the covid-19 period. This interest from Silicon Valley indicates an acknowledgement of the potential that Africa holds. Silicon Valley has been followed in paths in its strides into Africa by the US government and other governments around the world. The US Overseas Private Investment Corporation (OPIC) has an initiative called “Connect Africa’ which seeks to invest over $1 billion in projects that support transportation, communication and value chains in Africa. The US Trade and Development Agency (USTDA) on the

tech hubs in africa have an excellent opportunity for growing the startup scene and bringing sustainability to start-ups...

other hand, has Access Africa, which is well poised to support ICT infrastructure in Africa. Asian technology leader, South Korea has been playing by using the Korean development experience to support African start-ups. The Korea-Africa Foundation is an initiative that works to raise awareness among Korean entrepreneurs about the African start-up market. With support from international and regional investors as well as from governments around the world, tech hubs in Africa have an excellent opportunity for growing the start-up scene and bring sustainability to start-ups to ensure they can scale up. Local governments on the continent can assist by continuing to make adjustments in their policies that will create a regulatory environment that boosts rather than hinders technological innovation. v

africa global gateway

| 67

Brookes went on to say that “if successful, we have plans to roll out similar high-rise developments in other prime areas in Cape Town and Umhlanga in Durban … Like our other lifestyle developments, the Sandton project will include a range of supporting facilities like a laundromat, world-class gym, coffee shop and action football area.”

balwin’s r1.6 billion ground-breaKing project the wedgewood sandton

South Africa’s largest sectional-title middle income housing developer, the JSE-listed Balwin Properties is taking on a big bet in Sandton, with a R1.6 billion 20-storey residential development on the cards for the country’s financial hub.


ccording to Moneyweb, Balwin Properties CEO, Steve Brookes said the Wedgewood Sandton project represents the group’s first-ever high-rise development – With 1 340 units, it is a monster in terms of size. The development, called Wedgewood Sandton, was launched November 2020 and is part of our bigger vision around creating more inclusive housing in the country. Balwin CEO went on to explain, there is no doubt that strategically positioned properties, geared within the right price-point and supported by a modern, and in many instances, green-inspired lifestyle, have come into high demand. Balwin prides itself in a vision that brings people from previously disadvantaged areas into prime locations. “This is the ethos behind our new 68 | africa global gateway

concept, ‘Balwin Lifestyle Apartments’. Through this concept we are able to help more South Africans secure their own homes in an achievable way in a prime location such as Sandton.” Wedgewood Sandton offers studio, oneand two-bedroom lifestyle apartments from R799,000, whereby a deposit of R10,000 is required on purchase with all transfer and bond costs included in the purchase price. The Wedgewood Sandton will be in one of the country’s most prime nodes, just 200 metres from the Gautrain Sandton Station. The development is largely targeted at the first-time homebuyers’ market. Some of the key features of the development include: • Concierge; • Coffee shop; • Business centre; • Kid’s play area; • Laundry service; • Outdoor cinema; • Training Science gym; • Lounge and chill zones; • Rooftop five-a-side soccer field.

With more than 1 300 units planned, the development will be home to predominately apartments of between 33m2 (studio) to 55m2 (two-bedroom). Despite the size, Balwin continues to call the units ‘lifestyle apartments’ considering the amenities Wedgewood Sandton will offer on-site. With South Africa’s interest rates being at a multi-decade low, the residential property market is buoyant, despite the impact of the Covid-19 lockdown and consumers being under pressure as a result of job losses. “The housing market is doing particularly well below the R1 million mark, where a lot of firsttime owners enter the market,” said Brookes. Despite Covid-19, Balwin clocked up over 900 sales for its half-year. Wedgewood Sandton, which is offering entry-level apartments for R799 000, already has over 1 000 people registered pre-launch, and so Balwin remains confident about the project. The site, which is located at 144 Rivonia Road between Mushroom Park and the Radisson Gautrain Hotel, was purchased by Balwin properties from JSE-listed Fortress Reit Limited. The group has brought in private construction company Barrows as lead contractor on the project. Worth noting is that Barrows is the jointventure developer of a mixed-use development in Waterfall City together with Attacq, which includes a new Courtyard Hotel to be operated by JSE-listed City Lodge Hotel Group. v


part 2: heartbeat By Wamburakwao Sapao

The ritual Uncle Muzembe and the headman’s wife were engaged in was beyond my inexperienced, young mind’s comprehension. Why in hiding? And of all places, why retreat to the bathroom? I supposed that their secret ritual was wrong, nastily immoral. Curiosity rooted me at the chink, a narrow opening I had covertly fashioned in the wall of our grass and reed bathroom.


hen the woman gasped out loud and moaned softly within the bathroom, I trembled. Dread gripped the throat and rapidly spread to the stomach. I felt like I might throw up. I feared for her. I sharply realised that the duty to rescue the headman’s wife from possible despicable harm fell squarely on my shoulders. My legs, meanwhile, were as heavy as lead. I was hopelessly stationary, like a tree stump. A dawning uneasiness built at the roots of my hair and it slowly, and threateningly 70 | africa global gateway

descended along my spine; it settled in the small of the back and rapidly spread to the rest of the body. The spectacle sickened me! The problem at hand was in point of fact worse than I had anticipated. Uncle Muzembe was a wicked man. Unless I acted quickly and decisively, he would harm the headman’s wife. The mother to my friend Suteni. I had to have the poor woman rescued. I had no idea though how but I discerned, she had to be rescued, and fast. My mind ran in circles. Poor mother of Suteni! Luckily, the headman’s house was just beyond our backyard cassava field. “Think, Wambura think!” a voice whispered within me, “act quickly here and now!” Peeping through the chink in the bathroom wall, I saw her twisted mouth as clearly as you see the words in this narrative. Poor woman! Between gasps she barely managed muffled cries, “Mwanikoma ine,

you have killed me!” I did not need further persuading. My legs shot forward. I ran blindly, knocking down a mortar and pestle in my path. I fell down, bruising my knees in the process. In one motion I was up, on my feet and running again. I literally flew out of our compound, and I was now along the footpath to the headman’s house. The headman must know. He must know. The headman must save his wife. On and on I repeated my mission as I ran in a frenzy. I was past the cassava field. Then, I thought I heard wicked Muzembe hysterically calling after me, “Wambura! ‘Iwe! Wambura! Iweeeeh!’ You! Youuuuh!” I ignored Muzembe’s panic-stricken calls. His panic fuelled up my legs. I thought I was floating in the air at top speed, towards the headman’s compound. The ears kept buzzing the distinct, plaintive and subdued cry, of the headman’s wife, “Mwanikoma!”

At the threshold of the headman’s backyard, I was greeted by a quartet of noisy, hungry-looking dogs with bleeding ears. That signalled that there was nobody home. Probably, the family had gone ‘kumunda,’ to the gardens. The headman’s skeletal dogs were chained on every occasion the family was at home. I retreated just in time and ran towards the hills in Muthyengo, the direction of Grandma’s field. The dogs were my least concern. They reluctantly gave chase. But I ran like the whirlwind. I was an unrivalled runner, even among fellow boys. The unenthusiastic growls of the half-starved, skinny dogs were in no time far behind. The plaintive voice of the village headman’s wife kept ringing in my ears, “Mwanikoma!” I avoided the main winding footpath round the hills to Muthyengo. Instead, I took the old, disused shortcut across a rickety wooden footbridge. It dangerously swayed from side to side in the light breeze. Nevertheless, I ran across the bridge, oblivious of the rotting wood under my feet. I could not wait to narrate the unpleasant bathroom spectacle to Grandma. My Grandma knew how to deal with every situation. She had a solution to

every problem imaginable. No sooner had I arrived ‘kumunda,’ the garden – panting, excited and all than I blurted out the opening sentence of my mission. To my shock, Grandma landed a deafening slap on my face. “You are a disgrace, child!” Grandma spat every word. “Your uncle has been here ‘kumunda’ working all the time, ‘iwe Mutesi’!” (You, Liar) I opened my mouth, ready to explain, when Uncle Muzembe emerged from the bushes with some wild fruits in hand. His presence puzzled me. I prayed that he had not heard my accusation.

distinct yellowish soil in our bathroom on both knees of Uncle Muzembe’s pair of trousers. Muzembe was in the same shirt I had seen him in, in the bathroom; the elbows and cuff buttons had indistinct yellow smudges. “What had Uncle Muzembe done to Suteni’s mother?” I desperately wanted to know. I could not wait to return to the village. I gazed at Uncle Muzembe. He avoided meeting my eyes. That was how I was christened Mutesi. v

“I have picked enough fruits for everyone,” announced Uncle Muzembe. I was utterly shocked. How did he manage to be in two places at the same time? Did he have a twin brother? Then, one look at the shirt Muzembe was wearing, and I knew. I discerned the tell tales of Uncle Muzembe’s misconduct underneath the veil of his calmness. Here, ‘kumunda’ the soil was whitish sandy and lose. Out of the corner of my eye, I saw the

africa global gateway

| 71



Buying or investing in real estate is an investment strategy that can be both satisfying and lucrative. According to Investopedia, 2020 – Unlike stock and bond investors, prospective real estate owners can use leverage to buy a property by paying a portion of the total cost upfront, then paying off the balance, plus interest, over time.


hile a traditional mortgage generally requires a 20% to 25% down payment, in some cases a 5% down payment is all it takes to purchase an entire property. This ability to control the asset the moment papers are signed emboldens both real estate investors and landlords, who can, in turn, make down payments on additional properties. Here are 5 key-ways investors can make money on real estate. KEY TAKEAWAYS • Aspiring real estate owners can buy a property using leverage, paying a portion of its total cost upfront, then paying off the balance over time. • One of the primary ways in which investors can make money in real estate is to become a landlord of a rental property. • People who are flippers, buying up undervalued real estate, fixing it up, and selling it, can also earn income. • Real estate investment groups are a more hands-off way to make money in real estate. • Real estate investment trusts (REITs) are basically dividend-paying stocks. Rental Properties Owning rental properties can be a great opportunity for individuals with do-it-yourself (DIY) and renovation skills, and have the patience to manage tenants. However, this strategy does require substantial capital to finance up-front maintenance costs and to cover vacant months. Pros • Provides regular income and properties can appreciate • Maximizes capital through leverage 74 | africa global gateway

on real estate

• Many tax-deductible associated expenses

• Provides income and appreciation

Cons • Can be tedious managing tenants • Potentially damage property from tenants • Reduced income from potential vacancies

Cons • Vacancy risks • Similar fees as mutual funds • Susceptible to unscrupulous managers

According to Investopedia,2020 – sales prices of new homes consistently increased in value up to 2006, before dipping during the financial crisis. Subsequently, sales prices resumed their ascent, even surpassing precrisis levels. It remains to be seen what the long-term effects of the coronavirus pandemic will be on real estate values.

House Flipping Investopedia explains that house flipping is for people with significant experience in real estate valuation, marketing, and renovation. House flipping requires capital and the ability to do, or oversee, repairs as needed.

Real Estate Investment Groups (REIGs) Investopedia, 2020 explains that real estate investment groups (REIGs) are ideal for people who want to own rental real estate without the hassles of running it. Investing in REIGs requires a capital cushion and access to financing. REIGs are like small mutual funds that invest in rental properties. In a typical real estate investment group, a company buys or builds a set of apartment blocks or condos, then allows investors to purchase them through the company, thereby joining the group. A single investor can own one or multiple units of self-contained living space, but the company operating the investment group collectively manages all of the units, handling maintenance, advertising vacancies, and interviewing tenants. In exchange for conducting these management tasks, the company takes a percentage of the monthly rent. A standard real estate investment group lease is in the investor’s name, and all of the units pool a portion of the rent to guard against occasional vacancies. To this end, you’ll receive some income even if your unit is empty. As long as the vacancy rate for the pooled units doesn’t spike too high, there should be enough to cover costs. Pros • More hands-off than owning rentals

This is the proverbial “wild side” of real estate investing. Just as day trading is different from buy-and-hold investors, real estate flippers are distinct from buy-and-rent landlords. Case in point—real estate flippers often look to profitably sell the undervalued properties they buy in less than six months. Pure property flippers often don’t invest in improving properties. Therefore, the investment must already have the intrinsic

value needed to turn a profit without any alterations, or they’ll eliminate the property from contention. Flippers who are unable to swiftly unload a property may find themselves in trouble because they typically don’t keep enough uncommitted cash on hand to pay the mortgage on a property over the long term. This can lead to continued, snowballing losses. There is another kind of flipper who makes money by buying reasonably priced properties and adding value by renovating them. This can be a longer-term investment, where investors can only afford to take on one or two properties at a time. Pros • Ties up capital for a shorter time period • Can offer quick returns Cons • Requires a deeper market knowledge • Hot markets cooling unexpectedly Real Estate Investment Trusts (REITs) A real estate investment trust (REIT) is best for investors who want portfolio exposure to

real estate without a traditional real estate transaction. A REIT is created when a corporation (or trust) uses investors’ money to purchase and operate income properties. REITs are bought and sold on the major exchanges, like any other stock.3 A corporation must payout 90% of its taxable profits in the form of dividends in order to maintain its REIT status. By doing this, REITs avoid paying corporate income tax, whereas a regular company would be taxed on its profits and then have to decide whether or not to distribute its after-tax profits as dividends.4 Like regular dividend-paying stocks, REITs are a solid investment for stock market investors who desire regular income. In comparison to the aforementioned types of real estate investment, REITs afford investors entry into nonresidential investments, such as malls or office buildings, that are generally not feasible for individual investors to purchase directly. More important, REITs are highly liquid because they are exchange-traded. In other words, you won’t need a realtor and a title transfer to help you cash out your investment. In practice, REITs are a more formalized version of a real estate investment group.

Finally, when looking at REITs, investors should distinguish between equity REITs that own buildings, and mortgage REITs that provide financing for real estate and dabble in mortgage-backed securities (MBS). Both offer exposure to real estate, but the nature of the exposure is different. An equity REIT is more traditional, in that it represents ownership in real estate, whereas the mortgage REITs focus on the income from mortgage financing of real estate. Pros • Essentially dividend-paying stocks • Core holdings tend to be long-term, cashproducing leases Cons • Leverage associated with traditional rental real estate does not apply Online Real Estate Platforms Real estate investing platforms are for those that want to join others in investing in a bigger commercial or residential deal. The investment is done via online real estate platforms, also known as real estate crowdfunding. It still requires investing capital, although less than what’s required to purchase properties outright. Online platforms connect investors who are looking to finance projects with real estate developers. In some cases, you can diversify your investments with not much money. Pros • Can invest in single projects or portfolio of projects • Geographic diversification Cons • Tends to be un-liquid with lockup periods • Management fees Conclusion Investopedia notes that whether real estate investors use their properties to generate rental income, or to bide their time until the perfect selling opportunity arises, it’s possible to build out a robust investment program by paying a relatively small part of a property’s total value upfront. And as with any investment, there is profit and potential within real estate, whether the overall market is up or down. v africa global gateway

| 75

Profile for AfricaGlobalGateway

Africa Global Gateway  

A world premier Publication House, Priority Digital Media head quartered in New York with offices in Africa and the UK, runs a Business, Tou...

Africa Global Gateway  

A world premier Publication House, Priority Digital Media head quartered in New York with offices in Africa and the UK, runs a Business, Tou...


Recommendations could not be loaded

Recommendations could not be loaded

Recommendations could not be loaded

Recommendations could not be loaded