Corporate africa issue 60 digital by corporate africa

Africa

Quarter I 2014 Quarter I 2015 Issue 59 Vol 1 Number 888 Issue 61 Vol 1 Number 888

CORPORATE CORPORATE

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NEW DAWN FOR AGRICULTURE Agriculture Tops African Nations’ Agendas

UNIVERSITIES CHALLENGED Africa’s Learning Curve Trails Behind

OF OBAMA AND EBOLA Turning the Screw against the “African Century”

for innovative new diagnostics

Tuberculosis (TB) is one of the main areas of focus of the Foundation for Innovative New Diagnostics (FIND), a non-profit organization dedicated to developing high quality, affordable diagnostic tools that will have a significant impact on patient care in developing countries. For more information, visit www.finddiagnostics.org.

Patients diagnosed with multidrug-resistant tuberculosis (MDR-TB) being treated in an isolation ward in Manila.

Partnering against TB About 1.4 million people die of TB each year, and more than 80 percent of new cases occur in 22 developing countries. TB is the second-leading killer among infectious diseases and primary cause of death among people with HIV/AIDS. The problem is compounded by TB’s resistance to drug treatment, limiting the options for over 650,000 patients annually.1 BD is pleased to work with FIND to provide equipment, reagents, training and support to the public health sector in high-burden countries on terms that will enable them to purchase and implement these on a sustainable basis.

The BD MGIT ™ (Mycobacteria Growth Indicator Tube) system can shorten the recovery of TB in culture from 42 days to as little as 10-14 days. This can contribute to the reduction in spread and mortality of TB, particularly in HIV-infected individuals, where it is especially difficult to diagnose. Named one of the World’s Most Admired Companies ®2 as well as one of the World’s Most Ethical Companies®3, BD provides advanced medical technology to serve the global community’s greatest needs. BD – Helping all people live healthy lives.

StopTB/World Health Organization 2011/2012 Fact Sheet 2FORTUNE ® Magazine, March 2013 3Ethisphere® Institute, April 2013 Please visit www.bd.com BD, BD Logo and BD MGIT are trademarks of Becton, Dickinson and Company. © 2013 BD

Photo © Gerardo Sabado

CONTENTS Women in Tech 4

AFRICAN WOMEN IN TECHNOLOGY Corporate Africa’s feature African women who have found success in Africa’s ICT sector.

Voice of America 8

OF OBAMA AND EBOLA Correspondent, Harold James, looks at how President Obama’s policies are undermining African economies.

Agriculture 13

AFRICA’S GREEN AND BLUE REVOLUTIONS Sustainable Green and Blue Revolutions are a cause for hope in African agriculture says Caroline Kende-Robb. GHANA’S AGRICULTURE GOES BACK TO ITS ROOTS Ghana’s Minister of Food and Agriculture espouses Ghana’s national plan for the agriculture sector and says why it should be at the top of African agendas. BLUE SKIES OVER AFRICA’S AGRICULTURE British entrepreneur and CEO of Blue Skies, Anthony Pile, discusses his company’s success and its policy of adding value.

SPDC AGREES SETTLEMENT Mutiu Sunmou comments on Shell’s settlement with the Bodo Community.

AFRICA OIL & GAS AWARDS Awards given to honor oustanding contributions made to the industry by key players across Africa.

ITU 30

MOBILE TELECOM INFLUENCES CHANGE Safaricom’s CEO, Bob Collymore, writes about the transformative impact of ICT on Africa.

BRINGING INNOVATORS TOGETHER Global innovators come together at the ITU Telecom World Event.

EXPANDING GLOBAL COMMUNICATION Lycamobile CEO, Chris Tooley, explains his company’s expansion in Algeria.

Infrastructure 38

INVESTING IN AFRICAN INFRASTRUCTURE Private Infrastructure Development Group encourages private sector infrastructure in Africa.

ETHIOPIA’S LIGHT TRANSIT PROJECT Dereje Tefera speaks to Corporate Africa about Africa’s first light rail transport system.

Energy 20

URBAN TECHNOLOGY FOR AFRICAN AGRICULTURE Director, Rokiah Yaman, explains how LEAP’s new technology could benfit Africa’s agricuture sector.

Oil and Gas

ENERGIZING AFRICA Mikael Karlsson (Globeleq CEO) shares his insight on the continent’s fast-developing energy industry.

ENERGY SOLUTIONS FOR AFRICA Julia Modise, discusses how VJ Green Solutions transfers skills to local communities.

UNDER AFRICAN SKIES Interview with Esayas Woldemariam about one of Africa’s most successful airlines. MODDERFONTEIN NEW CITY Zendai Development South Africa’s CEO, Anthony Diepenbroek explains how Modderfontein will cater to the needs of a growing middle class.

Commodities 54

SABMILLER AND COCACOLA’S DRINKS MERGER Coca-Cola Beverages Africa will be the largest Coca-Cola bottler on the continent. Article by SABMiller’s Richard Farnsworth.

Investment 56

GHANA’S INVESTORFRIENDLY ENVIRONMENT Dr. Spio-Garbrah, Ghana’s Minister of Trade and Industry, discusses the benefits of investing in Ghana.

AFRICA’S NEW FRONTIER FOR INVESTMENT Abdirashid Duale, CEO of Dahabshiil, reflects on investment opportunities in Somaliland.

Education 62

AFRICA’S LEARNING CURVE Corporate Africa investigates why Africa’s universities are falling behind in the global education league tables.

Events 66

EVENTS Corporate Africa’s quarterly roundup of leading conferences and exhibitions promoting opportunities in the markets of Africa.

Published By Times Publications Group Ltd Publisher James Norris Editor Shan Bertelli, Assistant Editor Tsegaye Girma, Advertising Manager Assena Tabélé Graphic Designer Robert Ellerbeck Conference Coordinator Aisha Aingal Special Project Director Jian Ping Sun Administration Assistant Joshua Bismark Project Managers Aster Mengesha, Ashenafi Molla, Milkyas Getachew, Helene Suana Corporate Africa (ISSN 1358-5789) is published quarterly. Subscription details can be obtained from Times Media Group at principal commercial office: 30-32 Tabard Street, London SE1 4JU; Tel: +44 (0) 20 3758 9170 or Fax: +44 (0) 20 7403 1283. Email administration@times-publications.com or visit our website at www. corporate-africa.com. © Times Publications Group Ltd. 2014 — all rights reserved. First Published in 1994. Distributors in Africa: Shama PLC Tel: +251 11 554 5290, MCS/Caxton International PressTel: +27 11 807 9599, Print Excellence Ltd.Tel: +233 243 213 881, Dominion Bookshop, +233 240 695 791, Publisher’s Distribution Services Tel: +254 20 3222 901, PDS Accountant Tel: +254 20 3222 903, Glendora Bookshop Tel: +234 803 304 7091.

Women in Tech

African Women A profile of women that have found success in Africa’s information communication technology industry. By Shan Bertelli, Editor, Corporate Africa.

CT is the most dynamic and fastest growth industry across Africa with a diverse range of participants including young people, women, and the disabled.

Catherine Wijnberg

The sector’s influence on economic development will be significant and its potential to impact social progress, particularly gender divide in the workplace, is exponential. This is an area where women such as Nigeria’s Funke Opeke, CEO of Main One Cable Company, and Vida Ackom, CEO of Ghana’s Real IT Solutions Ltd., have achieved success.

Catherine Wijnberg is a successful female entrepreneur and strategic thinker in the field of small business growth and development. She is the Director and Founder of Fetola, a respected SME specialist consultancy and Enterprise Development agency as well as the Fetola Foundation, a not-for-profit entity dedicated to the economic empowerment of communities and individuals across sub-Saharan Africa. Here she discusses her experience and business aims.

We spoke to technology from and Kenya, about work in Africa’s

As someone with a passion for solving social problems using unusual solutions, I have spent the last decade searching for ways to achieve more for less. Of

several women in South Africa, Ghana, their experiences and thriving ICT sector.

Corporate Africa 2015

particular interest has been the use of innovative technology solutions to extend services, including business support and mentorship, to rural entrepreneurs and individuals for whom geographic location has often meant exclusion from support of this nature. In 2007, my team and I developed a national business support and mentorship program called Legends, supporting a pool consisting of largely women-led, black-owned, and rural organizations to be more substantial and effective. Initially, our model used traditional faceto-face and on-site mentoring, meaning that the mentor had to physically go to the beneficiary’s premises to do the work.

Economies of Scale As Legends started to attract sponsors and grow, we realized that on-site business support for organizations with more than 80 employees located all over the country was just not viable from a budget and time perspective – we needed a new solution. This prompted our first foray into developing remote mentoring and “virtual” business support services for geographically dispersed beneficiaries, and culminated in the development of the Fetola Mentor Hotline: an online portal that provides real-time mentoring and support for SMMEs and SMEs irrespective of where they are located, using a variety of communication mediums including email, online forums, Skype, telephone, and SMS. Basically, anyone with a computer or cellphone can now access expert business advice and mentorship from a pool of specialists, which means that those who have previously been unable to find the help they need because of their remote location no longer face that challenge.

Women in Tech

While this is an effective way of providing mentorship from a results perspective, and works if one is only supporting 10 or 13 organizations, it is prohibitively expensive to do to scale.

IT-based development solution. Having hosted several international interns in our business, I became frustrated at seeing them go back home after their internship was over and take all the teaching and experience they gained with them. I made a decision to look for local interns, so that any value built up through their internship could be retained locally, either in my own organization, or in another local business that could utilize a skilled intern with work experience.

In 2007, my team and I developed a national business support and mentorship program called Legends, supporting a pool consisting largely of women.

The challenge was where to find good local interns. We advertised on the normal job portals, only to be inundated with CVs, most of which did not meet our needs or requirements. The process was long and laborious, and I felt there had to be a better way for businesses such as mine to find capable local graduates for internship.

Catherine Wijnberg graduates and nearly 1000 businesses signed up. There are on average more than 2000 available internship opportunities on the site – each one an opportunity for an unemployed graduate to get their foot in the door and make their mark. Using technology tools as filters that allow a business to rightly refine their search for the right candidate, automated push notifications, and data management techniques, we are very proud of the fact that GAP has cut the average recruitment

in Technology The Fetola Mentor Hotline is in its early stages and is showing great promise. Our vision is to have every remotely located (as well as urban-based) entrepreneur who needs support signed up to the portal. Over and above mentorship, subscribers can access and download a range of business support tools and templates, participate in group discussions, offer peer-to-peer support and access special offers to help grow their business. We have made it accessible, affordable, and user-friendly, because we have seen first-hand the tremendous results one can achieve as a nation when the proper support is provided to emerging entrepreneurs and social enterprises. Interns for Africa Just as with the Mentor Hotline, it was our own experiences and needs that prompted the advancement of the second

That was how the Graduate Asset Program (GAP) was born. Having experienced firsthand the huge value that a good intern could bring to a small business, I wanted to make this opportunity widely available to other businesses across the country. Using seed funds from the Presidential Jobs Fund, we set about developing a customized portal that matches businesses seeking interns, with graduates seeking internships. The learning curve was huge – the site was developed from scratch, using technology similar to that of dating websites, but at a significantly more advanced level. The development took nearly two years, followed by a long period of beta testing and refinement, but I am pleased to say that goGAP is fast becoming one of South Africa’s largest (if not the largest) internship initiatives, with over 20,000

time for businesses seeking an intern from around two weeks to less than an hour. Support mechanisms include real-time support to businesses and interns alike, as well as a host of tools, templates, and resources for both parties, including an online graduate work readiness training course called “Bridging the Gap.” The site also allows us to gather very useful aggregate information that can be drilled into finer detail, such as types of internships being offered, what sectors are represented, what qualifications are most in demand, where most opportunities are located and so on. Given our youth unemployment challenges in SA, we are very pleased with what we have managed to achieve with GAP, and confident that it has potential to expand as a model way beyond our borders and into the SADC region. Corporate Africa 2015

Women in Tech In Africa it is really important to get introduced to the network of technologists and build those relationships.

Betty Enyo Kumahor Never Lose the Human Touch In conclusion, one very important lesson that I would like to share with anyone who utilizes IT-based solutions to expand their reach or scale up their offering is to remain conscious of the importance of human interaction. Nobody wants to feel like a number, so while fully automated processes might increase efficiencies and save costs, it seldom pays off in the long run. The trick to building success is to find the correct balance between automation and interaction. Our offering integrates technology solutions like automated responses and pre-scheduled communications, with a call center manned by enthusiastic, well-informed people who provide support, encouragement, and sometimes just a listening ear. This holistic offering, in my opinion, is the key to success: using technology to the fullest extent of its capabilities, but retaining that warm human touch. Betty Enyo Kumahor Betty Enyo Kumahor is well known in the West African ICT sector. Recently, she left Thoughtworks as the Regional Managing Director (to invest in and mentor technology-driven companies committed to sustainable business in Africa for Africa) and is currently a Managing Partner for The Cobalt Partners. She previously led the Ernst & Young’s Service Delivery Technology function

Corporate Africa 2015

for their Global Advisory practice and has also served on committees such as the Ministerial Select Committee of Ghana’s National Broadband Policy and Special Advisor to the Ghana Associations of Software and Information Te c h n o l o g y S e r v i c e s C o m p a n i e s (GASSCOM). Betty has become a spokesperson for women in the ICT industry. She also chairs the Women 2.1 Summit Advisory Board and the Ghana Woman in IT organization. Having worked in the ICT sectors of both the United States and Ghana,

In Africa it is really important to get introduced to the network of technologists and build those relationships.

she compared her experiences as a woman in a male-dominated field: “In my experience, technology in Ghana is significantly different from the technology industry in the United States. One of the good things that I did when I returned was to relearn what it was like to live and work here. I had little or no expectations about what I would find. “The percentages of women who are in technology and the particular

biases that exist on the African continent are very different from what I experienced in the United States, and the types of technology that work and are needed here are different. “It is a relatively small network of people across the continent so personal social capital and personality projection becomes really important. It’s such a large industry in the United States but you can do things with your CV and build introductions and there are normal verification systems. That doesn’t really work here. “In Africa it is really important to get introduced to the network of technologists and build those relationships. “However, the situation is changing. In Ghana there are a good number of women CEOs and CMOs in the technology sector. I think it’s doing remarkably well. Nigeria has some great people, and there are good Kenyan women coming up into those roles, and in South Africa also. There’s definitely a change.” Speaking about the prevalence of mobile phones in African lives, Ms. Kumahor discussed how African women interact with technology on a daily basis. “The mobile phone is a tool that gives women access to knowledge, not only for themselves but for their children. Wives of miners and farmers described how they needed to make sure that their children are not locked out of the mobile.

“More investment would be useful. And more women should be included in the groups that decide what to do or how policies and programs are shaped and designed. I think that the effectiveness of any investments will be increased by including women at management level.” Martha Chumo Given the nature of Africa’s immensely successful ICT sector, it will not come as a surprise to hear that the next “Woman in Technology” is young. Some of the leading entrepreneurs in the global tech industry achieved success almost as soon as they walked out of their universities. However, even they would find it difficult to remain unimpressed with the achievements of 20-year-old Martha Chumo from Kenya. When asked how she was introduced to the world of ICT, Martha Chumo declares that she “literally jumped into it.” Graduating from high school at the end of 2011, Martha’s plan was to continue her education at medical school. In the meantime, she got an internship in an office where her curiosity for the world of programming was piqued. “It was the first time I’d ever had a computer to myself and I was really fascinated with how it worked,” Chumo remembers. “I started Googling how a computer works and that’s when I came across programming and how to be a programmer. At the time, many websites that taught programming had been launched like Codeacademy, Coursera, and Treehouse. There were so many ways for me to teach myself!” Her internship work was soon set aside in favor of her fascination with programming. One of the coding languages Martha taught herself was “Ruby” but she was unable to find relevant courses on her usual websites: “I emailed them and said, ‘can I help you make an introductory Ruby course?’” After a few months, Chumo made the decision to abandon her plan to go to medical

school, opting instead to begin working on programming full-time. She bought a laptop with her savings and set to work. The Dev School Part of Martha’s success story springs from one of her major challenges. Having applied to the Hacker School, a New York-based “retreat for hackers,” she was accepted into their program and would have spent three months learning how to write code and new languages as well as learning about the industry from like-minded people. Although the school is free, Martha had to raise funds for her trip and buy a new laptop which she did by using Indiegogo, an online crowdsourcing platform. She surpassed her target of US$ 4,200 by US$ 1,400 and was set to leave when her application for a visa was denied on the grounds that she could not show sufficient “social ties” to Kenya, needing proof that she was planning to return after attending the program.

Women in Tech

There’s definitely awareness that mobile phones are a key tool to be able to do a lot of things, whether it’s researching farming methods or health apps.

in technology and rising through the ranks in the field of technology. While that is certainly praise-worthy, Chumo’s hopes are focused on a more long-term view. “I’m keen on the retention of women in technology. I have been in discussions relating to some of the issues that they face in the sector and why a good number of them leave. If they do, then we’ll never be a main part of the industry. Many women, after ten or fifteen years, decide to leave. Retention is what I’m keen on rather than just entry into the sector. I’m yet to find a mission, but we’re starting conversations around this and hopefully I’ll get more insight into it.” ■

Although she was disappointed and frustrated, Martha was inspired by the incident and decided to start her own school. Based on the same principle as the Hacker School, the Dev School runs three-monthlong courses in programming. Modest about her success, Chumo discusses the school’s appeal and plans for expansion. Martha Chumo

The majority of Kenya’s population is below 30 years old so there is a big youth unemployment issue. “There’s a good amount of people who have applied. The majority of Kenya’s population is below 30 years old so there is a big youth unemployment issue. People will do training in the hope that someone will give them a job or some sort of livelihood. It’s been interesting going.” Women in Tech Speaking of women in the ICT sector, Chumo stated that she was aware of more women getting involved at a training level

Corporate Africa 2015

Voice of America

Obama in West Africa

Of Ebola And Obama Obama has turned the screw against the “African Century” to benefit western interests, according to Harold James, Corporate Africa Correspondent.

merica decided to clean up its international image following the divisive foreign policy of the Bush administration, by electing its first African American president. However, during the six years that Obama has been in office, many African nations have become plagued with violence, more conflict, and terror forecasted for the future. On the domestic front, US police in armored vehicles carrying military rifles are being challenged in African American communities for killing black men considered innocent by many in their communities. This has led to a divided response across America: the fear is that it could undermine social stability and result in racial warfare. While the vast majority of US police are upright and moral, former Supreme Court Justice, Thurgood Marshall, made it clear during the 1990s that American paramilitary right wing and Nazi groups are no longer operating in white robes and hoods but in police uniforms and black robes as judges. An opportune time for a

Corporate Africa 2015

race war would be during the first African American presidency. The escalation of terror across Africa and the introduction of Ebola into highly resourced African nations recovering from decades of civil wars were unexpected

The escalation of terror across Africa and the introduction of Ebola into highly resourced African nations recovering from decades of civil wars were unexpected under a president with African roots. under a president with African roots. For the first time in African history, an Islamic group of African men who were campaigning peacefully for Islamic education turned to deadly violence and terror in 2009, following Obama’s inauguration.

Boko Haram kill and murder African people in the name of religion, without any clear and defined statements about what they are seeking to achieve through. Most of what has been said reflects the opinions of the international media. It therefore can be concluded that Boko Haram differs from Al-Qaeda in Libya by name only: they both seem to serve the same interests which is to increase instability and violence making countries ungovernable and less able to control national natural resources. Obama’s African policy suggests a new precedent for future relations with Africans has been established. He granted permission to a Western military alliance to enter Libya to kill its economy and depose Colonel Gaddaffi who was the financier and driving force of the African Union. The President sanctioned an attack by the French military against Côte D’Ivoire to remove President Gbagbo because the United Nations alleged that the opposition

Barak Obama’s presidency is perceived by many as a disguise for western capital to re-establish hegemony over the resources of nations which were looking to put their histories of conquests and colonization behind them: to become strong and sustainable economies.

Throughout modern world history, documented evidence and allegations abound about western interests exploiting disease poxes in their military endeavours in the name of empire and conquests of foreign resources.

Libya was one such nation where Gaddaffi’s death has led to the country becoming a base for Al-Qaeda terrorists, and increasing levels of violence in a nation that has the 10th largest oil reserves in the world. Violence and terror allows foreign interests to gain stronger footholds as host governments surrender control. It was in pursuit of such foreign interests that Sierra Leone established a laboratory at the Kenema Hospital to carry out clandestine research about which little is still known. Sierra Leone was one of several smaller African nations that were in favor of granting America permission to set up a military base. Economic Growth and Competition with Europe Africa’s economic rise commenced with the end of apartheid in South Africa, accelerating with China favoring the region as a strategic resource partner at the turn of the 21st century. The Sino-African relations heralded a new era for Africa which witnessed increased competition with Europe for Chinese resources, and competition between China and Europe for African resources. China offered an alternative source of finance instead of reliance on Western development institutions and funds. It was at the inception of the “African Renaissance” that the Truth and Reconciliation Commission (TRC) revealed that South Africa’s apartheid government had used the AIDS virus as a biological weapon against the country’s African population. The country had nurtured a bio-weaponry project led by Dr. Wouter Sasoon in conjunction with South Africa’s

military, aimed at Africans and the enemies of apartheid. According to anthropologist, Jeanne Guillemin (Biological Weapons 2005), some of the agents that were developed included Ebola and Marburg viruses. Throughout modern world history, documented evidence and allegations abound about Western interests exploiting disease poxes in their military endeavors in the name of empire and conquests of foreign resources and land. While African profiles and economies were rising in the international community, America was at war in Afghanistan and the Middle East with its Western allies to avenge the attacks on the Twin Towers. By 2008, the Middle East, Pakistan, and Afghanistan had been brought under control mainly through tribal and religious rivalry and the establishment of puppet governments to serve Western interests. With the job in Iraq and South Asia complete, it was now time to focus upon Africa and bring its richly resourced countries under the full control of Western interests. An African American president with direct African heritage was part of the West strategy to rein the region in. Western Beneficiary Western interests allege that bush meat was the source of the Ebola outbreak, but so far no animals have been identified for blame to be allocated. What is more significant is who the beneficiaries of the deadly diseases are. In all cases, it is Western interests that are making billions of dollars from AIDS, and are set to rake in billions more for new

Voice of America

party were the victors: an allegation unproven but accepted by the West.

Ebola treatment: Africans always suffer from diseases and Western interests are always the beneficiaries. It is safe to say that when Europe and America stop benefiting from AIDS and Ebola, Africa will cease to be the victims of uncurable diseases.

When Europe and America stop benefiting from AIDS and Ebola, Africa will cease to be the victim of deadly diseases. This will not be in the short term because in 2010, the USA registered an international patent against the Ebola virus. It owns the patent on Ebola and the rights to all its variations and research. The USA, which promotes itself as a light to the world and supreme altruists, is in fact planning to profiteer from the suffering of poor victims. Given that a patent is to protect the right of its inventor and exclude others from profiting, the inevitable question is: did the country which patented the Ebola virus also design it? Diseases and Terror Diseases and terror seem to be the order of the day from whichever angle Africa is perceived: civil war in South Sudan; El Shabab in Somalia; Al-Qaeda in Libya; and Boko Haram in Nigeria. Boko Haram is supposed to be opposed to Western education but their actions of destruction aimed at destroying nations across West Africa can be argued to be serving interests outside of Africa.

Groups like Boko Haram threaten to destabilise Africa’s biggest economy Corporate Africa 2015

Voice of America

A US military base in Africa, terror, and diseases will ensure the sustainability of foreign capital. A balkanized Sudan and Somalia offer higher yields and profits for global energy giants because the areas rich in resources have become new separate nations, away from the rest containing the burden of population.

The Ebola outbreak has had detrimental effects on the economies of Western Africa Boko Haram and Libya’s Al-Qaeda came into being under Obama’s presidency, both serving the same purpose as Ebola. Despite their different origins and nature; Boko Haram, Al-Qaeda, and Ebola are of the same strain of disease which exists to kill and undermine governments, people, and economies of Africa, serving foreign interests in the process.

Assistance,” is well-established with a US$ 1 billion budget, but the relief aspect is not only directed at Ebola.

When Europe and America stop benefiting from AIDS and Ebola, Africa will cease to be the victim of deadly diseases.

These are the same interests that President Obama appears to be serving. western military BASES An American military base thrived in Liberia until the first civil war during the 1990s. A decade after the ending of the second Liberian civil war, the US military has set up a regional Control Headquarter in the country to fight Ebola and control the spread of the virus to other nations. The plan, code-named “Operation United

The African continent as a whole was hostile to Africom, a US control and command outpost. It now appears that Ebola has opened an indirect channel for Africom to enter the continent and while it will initially be concerned with controlling Ebola, its greater mission will be to secure the resources of the continent which could counter the interests of other competing nations like China.

The African Union Although the goals of the AU look grand on paper, in reality the organization appears today to be an extension of EU policies. Its three important financial organs, the African Central Bank, African Investment Bank, and African Monetary Fund, were to be established in Nigeria, Libya, and Central Africa respectively. All three nations are currently experiencing long-term conflict and terror; Al-Qaeda in Libya, Boko Haram in Nigeria, and the Seleka Coalition in Central African Republic. None of these banks have been established and are unlikely to be set up by the 2020 deadline. Whatever conclusion is drawn from the insecurity in Africa, one thing is clear: the inspiration behind the AU died with Colonel Gaddafi, its financier and driving force, after Obama gave the go ahead for military strikes against Libya. Despite the economic success in recent years of many African countries, the continent appears to be beset on all sides. Facing destabilizing challenges at every turn, it is suffice to say that, through exploitation of policies and actions of the current American presidential administration, President Obama has turned the screw against the “African Century.” ■

The African continent as a whole was hostile to Africom, a US-control and command outpost

Corporate Africa 2015

VI PARTNERSHIPS FOR PREVENTION AND CARE AFRICA HEALTH CONFERENCE VI PARTNERSHIPS FOR PREVENTION AND CARE AFRICA HEALTH CONFERENCE Businesses of Africa in private public partnerships with foreign investors, developmental agencies and the public sector, working to build capacity across national and regional health and Medicare infrastructure.

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T.: +225 06178275 - Email: melaine@times-publications.com T.: +44 2070898830 administration@corporate-africa.com REGIONAL COORDINATOR: Joy- Email: Ogbuehi EAST AFRICA REPRESENTATIVE: Angela Loloba +234 8033536288 - Email: COORDINATOR: joy@corporate-africa.com EAST AFRICA REPRESENTATIVE: Angela Loloba REGIONAL Joy Ogbuehi T.: +254 734540772 - Email: angela@corporate-africa.com

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Agriculture

New Dawn For Agriculture

s we enter the final year of the Millennium Development Goals, agriculture has catapulted to the top of the agendas of African governments. â&#x20AC;&#x153;Invest in Agricultureâ&#x20AC;? has become a byword for future food sufficiency and economic sustainability.

Corporate Africa 2015

about the need for ongoing investments in agriculture and why it should become the chief driver for their economies.

Although governments across the continent recognize the tremendous progress made by the leading industries of Oil and Gas and ICT and telecoms, they all agree that agriculture is central to a national industrial mix if future economic growth and sustainability are to be achieved.

The opportunities provided by agriculture are plenty, as expressed in an exclusive interview with Ghanaâ&#x20AC;&#x2122;s Minister of Food and Agriculture. According to him sustainable investments in agriculture are the bedrock of technological innovations and feed into other major infrastructure. This is why all developed nations protect their farmers with common agriculture farm subsidies, running into billions of dollars, making it impossible for outside competition to enter their agriculture markets.

In this first Corporate Africa of 2015, the magazine features a report about the state of agriculture in Africa: government ministers and industrialists representing African economies make strong presentations

African nations are seeking to make the first of many steps in 2015 toward a common policy of investment in agriculture, which bodes well for their industries, peoples, and economies.

Agriculture

Africa’s Green and Blue Revolution Sustainable Green and Blue Revolutions are a cause for hope in Africa, and there is great potential to build on a decade of growth across these industries according to Caroline Kende-Robb, the Executive Director of the Africa Progress Panel.

he 2014 Africa Progress Report, “Grain, Fish, Money,” addressed issues relating to boosting African agriculture in order to reduce poverty across the continent where 413 million people live below the poverty line. Panel members including former UN Secretary, General Kofi Annan, and former Nigerian President, Olusegun Obasanjo, found that Africa has the potential to feed itself and other populations in line with global food demand which is set to double by 2050, despite importing US$ 35 billion annually. The report has gained momentum as the subject of Africa’s agricultural potential has risen on the agendas of high-level government organizations and investment companies.

extraction, and the billions of dollars that cannot be accounted for in many African countries. The report gained significance to the extent that it influenced the British Government who discussed the importance of tax and transparency issues during the G8 Summit in 2013.

“Africa is experiencing substantially higher yields and are benefitting from crop increase.”

Mrs. Kende-Robb went on to say that, “the same may be happening with agriculture and fisheries, and that the panel is one voice among many generating momentum and pushing forward issues that are controversial, which is important because the organization does not have the support of big bureaucracies.” Following the report, it has been recognized that Africa has good arable land and the potential to help with food shortages which will affect many parts of the world in the future. However, there is a need to regulate fisheries in particular because the EU has large

According to Mrs. Kende-Robb, the Africa Progress Panel group was surprised at the unexpected increase in support for the report because the issues of agriculture and fisheries are often not discussed at the highest level, yet a lot of the problems are global in nature. People perceive crises but no one really thinks about the global solutions. She is very hopeful that the report will result in substantial changes, given the success of its predecessor, “Equity in Extractives: Stewarding Africa’s natural resources for all.” The Africa Progress Panel has an important voice in trying to influence tax and transparency policies, bringing clarity to the issue of mining and oil and gas Corporate Africa 2015

Agriculture subsidies which are essentially subsidizing Illegal, Unreported and Unregulated (IUU) fishing. The report has had an effect on NGOs and policymakers such as US Secretary of State, John Kerry, who has firmly put the issue on the agenda of managing the global ocean. The report has also had the support from organizations such as the Global Oceans Commission which has expressed the view that, “the international voluntary rules for global fishing are a coordinated catastrophe.” The organization is working with heads of governments in Europe, linking them to heads of governments in Africa. It tries to engage African leaders to establish partnerships where countries learn from

each other. Another major problem is managing the coastal areas. This is critical and could be on the agenda of the G7 meeting in 2015. In the meanwhile there has been a good response from the heads of state in West Africa who are trying to partner each other to better police the coastlines. One problem is the estimation of the amount of fish being stolen. While the report says that US$ 1.3 billion worth of fish is lost annually across West African shores due to illegal fishing, the panel believes it could be much more. Also mentioned in the report is the Port State Measures Agreement, under which ports would be able to refuse boats engaging in IUU fishing and stop them from unloading their catches. Commitment is required from 25 countries to make

this agreement law which would raise the effort to combat illegal fishing. Data shows that trawlers engaging in IUU fishing off West African coasts are from China, Russia, Thailand, India, and the EU. Due to lack of awareness, regulations, and tracking, the trawlers manage to escape without legal repercussions. While this is an issue mostly discussed in an international and regional context, local fishermen are fully aware of the damage that illegal trawlers do to their industry and livelihood. Recently, however, the Senegalese government fined a Russian fishing vessel for encroaching in its national waters. Illegal practices are not restricted to fisheries, as the report found that illegal logging costs the continent an estimated US$ 17 billion per year. Additionally, tax avoidance and evasion contribute to the problem as illicit financial flows cost Africa 5.6 per cent of its annual GDP (US$ 50 billion), which is more than the entire continent spends on health and more than any other region in the world. Despite difficult circumstances, the report is optimistic about Africa’s potential in this sector, particularly in agriculture, and the added value which comes from the region’s booming IT and communication industries. Technologies developed by Africans for Africa accelerate productivity growth, which has the potential to double within five years. The report

Corporate Africa 2015

Agriculture

One problem is the estimation of the amount of fish being stolen. While the report says that US$ 1.3 billion worth of fish is lost annually across West African shores due to illegal fishing

features case studies showing the detrimental effects of erratic climates. Farmers are now receiving technological help and adapting accordingly. Kende-Robb continued: “Farmers are increasingly using different practices and are better-informed, even on how to milk cattle. Apps are now available that offer guidance on how to get the best out of cattle. Other innovations include crop insurance and weather pattern tracking. Africa is experiencing substantially higher yields and are benefitting from

US$ 1.3 billion worth of fish is lost annually across West Africa due to illegal fishing

crop increase. Ethiopia and Rwanda are excellent examples in increased yields, which are still very low when compared to other continents, but good progress is being made.”

launched the Youth Employment in Agriculture Program (YEAP) and the Fund for Agricultural Finance (FAFIN), declaring that agriculture would become the new oil.

While there is potential for a boom in agriculture and fisheries, investors and governments tend to prioritize extractives and energy resources. Due to a lack of information, oftentimes investors will exaggerate the risk of doing business in agriculture in Africa. Last December, Nigeria’s Minister of Agriculture, Dr. Akinwumi Adesina,

This is a new development in agriculture, which bodes well for the future in Africa’s most populous nation where investment in the sector is still less than 10 per cent. Increasing investment makes good business sense because it is required to satisfy food demand, national sustainability, and independence.

Sustainable Blue and Green Revolutions across Africa are a cause for hope.

There is great potential to build on a decade of growth in agriculture according to the report which, if successful, could lead to farmers in Africa capturing a share of the US$ 35 billion market in food imports. This can be realized with homegrown innovation, the right policies, improved infrastructure, greater financial inclusion, and better protection of Africa’s resources. Sustainable Green and Blue Revolutions across Africa, the report concludes, are a cause for hope. ■

Corporate Africa 2015

Agriculture

Ghana’s Agriculture goes back to its Roots In this exclusive presentation to Corporate Africa, Ghana’s Minister of Food and Agriculture, Fifi Fiavi Franklin Kwetey, espouses Ghana’s national plan for the agriculture sector and why it should be at the top of every African country’s agenda.

he African extractive industries are targeted for priority when it ought to be agriculture, according to the Ghana Minister of Food and Agriculture. Agribusiness is to be targeted if Ghana and Africa are to become truly independent and self-sufficient. It is promising that inclinations toward agriculture has become a current affair across Africa, perhaps due to Nigeria’s recent agricultural transformation which will impact on its industrial mix. Kenya is also implementing similar policies and Ghana’s direction is clearly in line with the rest of the continent. Nigeria, for many decades, thought that the oil and gas sector could be the game changer for the continent, but they are coming to the realization that it is not. Real inclusive growth must come from agriculture and Ghana has realized that it should start there. The African Union (AU) is working on this, as is ECOWAS (the Economic Community

Corporate Africa 2015

of West African States), and AGRA (Alliance for a Green Revolution in Africa) is also working closely with African countries. I think there is a broad consensus that this is very important. The general attitude of companies looking to invest in this sector is enthusiastic.

Agribusiness should be targeted if Ghana and Africa are to become truly independent and selfsufficient.

Companies want lots of growth and Africa is considered to be a continent of real growth, particularly in the agricultural sector. The world population will soon rise to nearly 9 billion. In the midst of this, challenges like overpopulation, climate change, and a reduction in arable land

abound. Africa holds the key. Investors are clearly looking toward optimizing the capacity in Africa and elsewhere. Currently, Africa is operating with huge handicaps in terms of seeds which are not compatible with the environment; no irrigation or proper financial schemes; and no established market. Despite this, the agricultural sector is still growing, which will result in significant transformation when the infrastructure is put in place. This is a game of costs at this point and with the right vision it could become an attractive sector for investors in Ghana. The private sector is considered to be an engine of growth and Africa’s private sector comprises people who are working in agriculture. If transformation is sought on the continent, it must start from the huge numbers of people such as small farmers holders, who are currently facing daily risks because of poor incomes, subsistence yields, and lack of transformative growth.

Agriculture

One must begin with agriculture in order to change Africa’s capacity to become entrepreneurial. Small farm holders need to be trained in how to assess, how to measure risk, how to make small businesses viable and sustainable, and how to acquire expertise, especially in technology, for innovation. If they could operate from this level, the potential for the future would be massive. To achieve this requires cooperation with other industries, and land issues need to be resolved. For example, centuriesold customs and traditions need to be changed relating to landownership and farming techniques. Models that generate sustainability and productivity need to be put in place. This is what the situation requires for the change sought. Ghana’s number one export is raw cocoa. The country must move on to the next level: transforming the raw cocoa into

other value-added products. Rice is also a game changer and beyond that there is also poultry and livestock. Generally, the need to increase the amount of meat production exists. There are huge opportunities in livestock and dairy in

Ghana’s number one export is raw cocoa but the country must move on to the next level: transforming the raw cocoa into other value-added products.

Ghana which would improve the nutrition and health of the populace. There are also cash crops which clearly have strong potential. This includes palm oil, which can be exploited in collaboration with countries with palm

oil experience like Indonesia and Malaysia to benefit Ghana. Ghana’s Ministry of Food and Agriculture has begun to work closely with other ministries to improve and develop the sector. Working with the Trade Minister allows development in overseas markets. It is also working with the Science and Technology Ministry to bring innovations which are needed to transfer technology and skills and transform the industry. Young people are contributing innovations and designing schemes and technological facilities that are helping farmers. One young person has developed an app that gives farmers up-to-date information about when to plant, when to harvest, and other related matters. This bodes well for the industry’s future and should be encouraged on a continent where most technology is imported. ■ Corporate Africa 2015

Agriculture

blue skies over africa’s agriculture In 1998, Blue Skies opened its first factory in Ghana with British entrepreneur, Anthony Pile, at the helm of the pioneering enterprise. Seventeen years later, the company’s success is a testament to its policy of adding value.

had an idea to put the factory where the fruit was, to deliver fresh-fromharvest, value-added products, when I was the Managing Director at my previous company, but they did not share my vision and fired me! With no job and a family to feed, necessity pushed me to pursue my idea and turn it into reality. Since its foundation in 1997, the company has grown so much that it now achieves a group turnover of over £50 million (US$ 75.61 million), 50 per cent of which is contributed by the Ghana factory mainly through export sales. Blue Skies

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has also been recognized for a number of achievements relating to its work with farmers including being the first company to achieve the environmental standard Linking Environment and Farming (LEAF) for a group of farmers in Africa. Blue Skies has been praised for its ethical approach, which we call our Joint Effort Enterprise (JEE). The JEE is based on the very simple idea that a business like ours works best if it is inclusive, socially equal, and strives for profit. It includes our culture at the center, but it also emphasizes the importance of diversity and profit.

Diversity because we believe diversity of views, perspectives, experiences, age, culture, race, and knowledge creates a synergy conducive to solving problems, coming up with the best ideas, and staying ahead of the competition. Profit because we recognize that we need to make a profit to conserve these values and enable us to achieve our mission. After 17 years of growth and success, Blue Skies has seen some impressive growth recently, thanks to our “fresh from harvest” philosophy. While the British fresh-cut fruit market has declined by 0.6

Agriculture

per cent in 2014, Blue Skies experienced growth in Britain by 14 per cent. Currently, it is a lot tougher now if you are an investor in the agricultural sector than when we started. Now with oil seen as the panacea, agriculture has been forgotten, and we struggle to get recognition and support for what we are doing. Thankfully we are now seeing signs that the government is changing its view on agriculture, but we are yet to see any tangible results. For our Ghana factory we would prefer to source everything from within the country; however, this has not been possible recently. For example, we need more fruit as our business expands. Ghana currently cannot supply all our needs so we require a big push in sourcing more locally produced fruit.

In June 2014, Blue Skies was compelled to source commodities (specifically pineapples) from Burkina Faso and Côte d’Ivoire due to a significant drop in Ghana’s supply of fruits and vegetables.

Agribusiness should be targeted if Ghana and Africa are to become truly independent and selfsufficient.

A lack of support for agriculture, coupled with its negative appeal among the young, has meant there are fewer farmers now than when we first started. To address this, we are embracing vertical integration as a business

while doing all we can to support our existing grower base and reverse the negative image of farming. We are also developing new product areas and investigating new markets such as the USA and Asia, while sticking to our principles of fresh-fromharvest and value adding at the source. One thing that sets Blue Skies apart is that the processing and packaging is done in Ghana, which means an estimated 70 per cent of the product value remains in the country. This could be encouraged among African farmers and agricultural companies by stimulating foreign investment. Investors should be concentrating on developing value-added products for export and local markets. Ghana imports so much food but it could produce a lot itself and reduce its trade deficit by exporting high-quality products such as chocolate rather than raw cocoa. ■

Corporate Africa 2015

Energy

ENERGIzING

AFRICA

CEO of the leading private power company in sub-Saharan Africa, Mikael Karlsson shares his insight on Globeleq’s experience in the continent’s fast-developing and increasingly transparent energy industry with many opportunities for the private sector.

ince launching in 2002, Globeleq has become the leading private power company in sub-Saharan Africa and is involved in 27 countries with projects amounting to 14,000 megawatts. Karlsson’s association with Globeleq began in 2002, advising the company on acquisition opportunities in Asia and Africa. He was appointed CEO in 2009 and has extensive experience in global development, acquisition, financing, and equity investments of energy and infrastructure assets. GLOBELEQ IN AFRICA Although Globeleq is involved in other emerging economies (with power plants in Honduras, Costa Rica, and Nicaragua), Karlsson identified growth as one element that sets Africa apart. The large number of gas finds across the continent was another one of Africa’s appeals for Globeleq, with discoveries made in Tanzania, Mozambique, Côte d’Ivoire, and Nigeria. It was noted that gas is not only cost-effective but relatively clean, making it a valuable resource. Furthermore, the cost of renewable energy is decreasing, which means that it is more cost-effective in the African market, with realization of profits increasing in line with declining prices.

Corporate Africa 2015

Globeleq has been operating on the ground in Africa since 2002, and was previously involved through its predecessor, the CDC Group. Karlsson discussed how the company benefits from its long-standing relationships and understanding of how the African business environment works in different and fragmented markets as well. Its approach to Africa as 54 countries and different traditions, cultures, languages, religions, and geography rather than a whole are a few of Globeleq’s advantages on the continent.

“In South Africa, 1.5 per cent of our revenue goes to community projects. That’s about R20 million a year (US$ 1.73 million) that we’re investing in education, school, and health benefits.” Karlsson went on to talk about how Globeleq also makes the effort to get involved with the communities in which it operates and has interests. “For instance, in South Africa, 1.5 per cent of our revenue goes to community projects. That’s about R20 million a year (US$ 1.73 million) that we’re investing in

education, school, and health benefits. We get very much involved in those aspects.” While Globeleq has three major power plants in South Africa, it is also involved in comparatively smaller economies. Karlsson discussed the relationship between those governments and the company, using Tanzania, East Africa, as an example of where Globeleq has operated for more than a decade. “We’re producing 50 per cent of the energy input there, so we are a very big player in the market. It’s a pretty good dynamic and a good relationship although this sector is going through some issues. The sector’s cash flows from TANESCO’s (Tanzania Electric Supply Company Ltd.) perspective have not been sustainable so the government has to support them with some budget injections, but TANESCO has also suffered, like the whole sector, from payment problems. It is very important that they work that out so TANESCO has enough cash to pay for its own invoices, which is going to be essential for them to attract new capital into the energy sector.” Despite these problems, Karlsson expressed more optimism for Tanzania’s efforts to build a large gas infrastructure

Energy

Globeleq, led by Mr. Mikael Karlsson, has become the leading private power company in sub-Saharan Africa around their domestic finds. The infrastructure should be completed by next year and will greatly reduce the cost of power consumption. Globeleq is also a key player in Cameroon with 300 megawatt capacity: “The government’s been very supportive; they want us to expand on our existing facilities, increasing the Kribi power plant project by 50 per cent which we are working on and hope to get started by next year.” THE PRIVATE POWER SOLUTION While power production has improved overall in the continent over the last few years, inadequate power supply continues to plague African countries, causing disruptions and inconvenience to businesses and individuals. Karlsson sees private power as the main solution to the problems in this capital-intensive industry. “What private power does better than any other configuration is to construct power plants on time and on budget and to operate using best practices and standards. Our power plants in Africa

are operational 97 per cent of the time. That means that, whenever you need our power, it’s pretty much available. Compared to government facilities, which are operational 50 per cent of the time, our power plants basically do the work of two government plants.”

“The private power model has been developed, established, and proven itself successfully in the industrial part of the world, so it’s a proven model that would work well at anytime.” Another reason Karlsson views this as a good solution is the government’s limited amount of capital in this market: “The government should focus on putting their capital to work when the private sector will not or cannot participate, and lacks efficiency or effectiveness. The private power model has been developed,

established and proven itself successfully in the industrial part of the world so it’s a proven model that would work well.” TRANSPARENCY In terms of the challenges in the sector, Karlsson talked about unclear frameworks and regulations as one of the most offputting issues for investors. “In many of these countries, the power supply is subsidized by government and the entity that sells the electricity has a monopoly. Not enough cash comes in because of subsidization and then the government has to contribute to the economics of that entity to make it work. Many of these monopolies are not interested in the private sector building new power plants because they want to build their own.” Karlsson used South Africa’s clear framework and procedures as an example of how the procurement process can do well, particularly as it is run by the country’s treasury, not a power company.

Corporate Africa 2015

Energy “South Africa have a truly great private power sector. Looking at renewable energy, they have said that they are going to double the capacity of the system by 2030 and 18 gigawatts of the total 40 is going to be renewable.” Workers at Globeleq’s Songas plant in Tanzania

He emphasized the need for government to make it clear that they want to support entities that buy power and control with good tariffs in place. With cost-reflective tariffs in place, the entity buys power from companies like Globeleq and sells it to customers. This is the kind of structure Karlsson declared was needed. Having recently spoken with Ghana’s government, Karlsson found his discussions very encouraging. “They want the private sector capital to build up the power sector and are focused on solving the fuel issue. They’re starting to get gas from their own Jubilee Gas Field instead of reliance on Nigeria. It is very encouraging to see what they are doing but there are still questions that need answering. They have to work on the framework and entities that will provide government support arrangements and have them standardized. “Of course, they need to make sure there’s enough gas in the system and establish cost-reflective tariffs. The electricity in Ghana should become viable

Corporate Africa 2015

for those tariffs to increase over time and that’s not happening. I think they’re on the right track, but there are some big issues they need to resolve to make it happen.” RENEWABLE ENERGY In terms of renewable energy, Karlsson stated that the most exciting African country to be involved in is South Africa for two reasons: “They have a truly great private power sector. Looking at renewable energy, they have said they are going to double the capacity of the system by 2030 and 18 gigawatts of the total 40 is going to be renewable. They have gone through a phase where they are allocating 3,900 megawatts and 64 projects. About ‘US$ 12 million’ has been raised, which is all private capital. ” Secondly, he praised the government’s clear protocols, policies, communication, transparent rules, standard contracts for power participation agreements, and great connections. Additionally, the government provides strong support, offering guarantees to all power purchase agreements.

in Africa where they play roles of diverse sizes in most markets. He emphasized the importance of having a diversified portfolio which prevents falls in production capacity during possible dry spells. “We’re actually finding that renewable energy is one of the cheapest sources of power: it is one of the fastest to get implemented because of the short construction programs. Obviously these projects have had great success in South Africa but in Kenya we see that they are also building several renewable energy projects: geothermal and wind.” Backed by 13 years of success and diverse experiences across the African continent, Karlsson’s praise of South African renewable energy and countries in the process of developing their energy policies and production paint a positive picture for Africa’s energy potential. ■

“That has been the most successful program by far and the most attractive one because there are so many opportunities there compared to the other markets.” Speaking in a broader context, Karlsson had a positive view of renewable energy

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“The treasury department in South Africa is probably the best-run; it attracts the brightest people for that reason so they’re running a very clear, crisp program that they developed with international advisors.”

A ATNS – celebrating 21 years ars off outstanding Air Traffic Management nagementt Over the past 21 years, Air Traffic and Navigation Services SOC C Limited (ATNS) has supported the grow growth of our democracy by connecting Africans across borders through This year, as h expert air traffic navigation. Th es its coming of age by prou South Africa celebrates 20 years of democracy, ATNS celebrates proudly sharing our key milestones with you: 1993 1995 1998 2001 2005 2009 2012 2013

The founding of ATNS and the start of Project Pronav to upgrade and d exte extend terrestrial navigation systems The founding of the ATNS college ISO accreditation Installation of 2D Air Trafﬁc Control simulator at ATNS’s Aviation Training Academy Satellite communication upgrade system commences Control tower construction at King Shaka International Airport Inauguration of NAFISAT Master Back-up Terminal in Uganda ATNS in conjunction with the University of the Witwatersrand Business School launched the Aeronautical Management Development Programme (AMDP) – the ﬁrst of its kind in Africa; As part of ATNS’s Women’s Development Programme, 13 female staff members complete this programme 2014 ATNS and its ASIOACG partners are voted and awarded the prestigious Best Service Provider Award at JANES’s annual ATC Awards Ceremony, held in Spain

Here’s to the next 21 years of ATNS and our democracy: may we continue to reach new heights – together! Fo For more information about our comprehensive range of services, please visit www.atns.com or call us on +27 11 607 1000. pleas

Energy

African Energy Solutions The first priority of VJ Green Solutions, a majority-owned women’s company, was to work inside local South African communities to transfer skills and, later, partner with international companies. By Julia Modise, Director, VJ Green Solutions.

J Green Solutions is a South African-based company trading in the renewable energy and energysaving sectors. The company was awarded a contract by CARE Angola in 2012, to electrify 425 village houses and 31 small businesses. It was a train-the-trainer project where technicians were transferred from Cape Town to train local people in Angola: to install, maintain and repair solar home lighting systems. During 2013, the company acquired another project from Eskom to replace 250 electric geysers with solar water geysers across South Africa’s Free State, North West, and Western Cape provinces. It is currently one of only 19 companies accredited by the City of Cape Town to install high pressure solar water geysers, which will take two years to complete. VJ Green Solutions’ credibility and track record has been noted and is attracting further interest across Africa. The company has been shortlisted by an international oil company to do a pilot project to electrify 400 houses in South 24

Corporate Africa 2015

Africa’s Limpopo province. Success of this project would result in 1000 village houses receiving electricity. VJ Green Solutions’ management travel extensively within Africa assisted by both Leading Women of Africa (LWA) and South Africa’s Department of Trade and Industry to market its services and to form new connections.

VJ Green Solutions’ credibility and track record has been noted and is attracting further interest across Africa.

This has taken the company to countries like Ghana, Nigeria, Ethiopia, the Democratic Republic of Congo, Angola, and Tanzania. And plans are afoot to visit Burundi to partner with companies that are in construction, housing development, or architects. Newbuild projects would be provided with solar solutions. The renewable energy industry is very competitive and keeps on evolving.

Competition with national and international companies exists at all levels for markets, high technology, and pricing. International companies benefit from opportunities for renewable energy across Africa, which is where VJ Green Solutions is currently trading. Another challenge is a shortage of readily available skills to install solar water geysers and PV technology. Acquiring the services of skilled technicians is costly, which has influenced VJ Green Solutions’ decision to create synergy with like-minded businesses to share knowledge and skills. The company’s services have also evolved. VJ Green Solutions is no longer confined to selling products but is now exploiting those that are relevant to projects, such as solar water pumps for pumping water from dams or boreholes and solar street lights where they are required. They are supplied, installed, and maintained. VJ Green Solutions’ first priority was to work with local communities to transfer skills. In the process of becoming more competitive they have partnered with international companies to build the competitive edge required to participate in big projects. ■

Energy

LEAP Develops Urban

Solution for African Agriculture Rokiah Yaman, Director of LEAP, explains how she and her team are working on technology to produce clean and renewable energy from food waste that could benefit Africa’s agriculture and energy sectors.

Technology which will process organic waste to generate clean, renewable fuel and fertilizer

oday, 18 million tons of the UK’s edible food valued at £23 billion (US$ 34.87 billion) ends up in landfill. Not only is the cost rising, but London’s food waste alone represents 6.3 million tons of greenhouse gases. This resource could help to power and feed cities, making them more sufficient, sustainable and resilient.

This type of technology has the potential to drastically reduce the cost of fertilizer, which is an issue in African agriculture.

Origins A few years ago, a micro-scale aerobic digestion (AD) project was running in the north of England, coordinated by a community composting network which managed to gather various interested parties including engineers, suppliers, and companies who were interested in this kind of energy generation.

LEAP is developing micro anaerobic technology to process organic waste and generate clean, renewable fuel and fertilizer. During decomposition, organic wastes emit gases (such as CO2 and methane) which anaerobic

digestion captures and uses the waste to produce digested material (digestate), which is siphoned off and used as a fertilizer. There is a pilot program of this established at Camley Street Natural Park near King’s Cross Station in London.

I got involved near the completion of that venture and was looking for a project that could become economically sustainable and would benefit the environment at the same time. The technology used by LEAP’s micro AD project seems to have

Corporate Africa 2015

Energy

If we can get the information from farmers then we can make a better product which is economically sustainable, environmentally friendly, and available to use in urban and rural environments. Rokiah Yaman spoke to Corporate Africa at LEAP’s King’s Cross site in London

the potential to do both and has lots of extra benefits. LEAP originally raised funds from Camden Council, WRAP (the Waste and Resources Action Program), and the Technology Strategy Board, now called “Innovate UK.” The team envisioned four sites to house designs between 1 and 20 cubic meters. All the equipment was modeled around the monitoring systems they would need, the economic case, and how they might work if they were in a network. Currently, the team is investigating the use of this technology in the United Kingdom, in an urban context or a cluster of villages: studying various issues around the small-scale area. The project The objective of the project is to develop technology to be affordable, robust, easy to use, and to look good. At the moment, the pilot plan is producing stable amounts of gas daily and is very reliable. It is due to be connected to a micro CHP (Combined Heat and Power) unit, which, at this domestic scale, is like a boiler that generates electricity and heat which is captured at the same time. This boiler is going to be used to generate electricity and heat from the

project center at the London, King’s Cross site. We estimate that we can manage to provide 30 per cent more heat than the site requires. Another site is up and running at the moment using a very low-cost demonstration model. The model at London, King’s Cross site is medium cost as it has two tanks at the front end while the second site will only have the digester and digestate storage. The gas will be used for heat during the winter and for agriculture in a way that is beneficial to the environment. The digestate (or fertilized material) that comes out is very good for plants. In Africa, we found that the fertilizer is very expensive. This kind of technology could help to bring down farming costs considerably and, although they might not need all the heat for agriculture, it could be used for other things on a farm. At the second site, the aim is to turn the gas into fuel so that it could be used to heat things up and electricity to power simple things like cooking and lighting. If you do not have to manipulate the gas, there would be no cost. However, if you start upgrading

the gas by taking out the CO2 or compressing it, further costs accrue, but the gas can be used for different things. By the time the project is complete, we hope to demonstrate a range of uses for the biogas. We are looking at the digestate side of things also. While it is relevant to Africa, where it is easier to use in farm culture, there are more challenges to using it in an urban context. The Team Within the partnership, there is much expertise. Apart from the two groups who are looking at community benefits of this type of technology, we are working with two very good researchers from the University of Leeds with backgrounds in modeling processes and optimizing them. There are independent engineers with strong backgrounds in agriculture equipment; and we have an anaerobic supplier who is very experienced, helping the technology to become robust and simplified for over 40 years. We are currently at the point where we are looking further ahead and thinking about how to move forward. Future developments Given that we are currently compiling the final report for the King’s Cross site,

Corporate Africa 2015

Energy LEAP is looking for more fundraising as the next stage of development needs to be supported to fully optimize the systems. It tends to be easier to get private investment when your product is ready for market. This project is about a year away from that phase and we would need other kinds of funding to get to the point where we are investment ready. Currently, I assume that social investors rather than venture capitalists would be more interested in the project. There are two routes to take at this stage. The commercial route is where we manufacture optimized systems and sell those as they are. The other route is to look at open-source collaborations. We are presently looking at a competitive funding opportunity at the moment, which would take this project a step further and make the outputs available online within an open-source platform with the aim of engaging the wider global community in tackling waste during the remaining years of the 21st century. This is a way to bring other people in and connect to make the most of the knowledge that comes from a project like this. Potential for Africa One of our partners has links with a company that is involved in African markets and done deals with agricultural materials. There is already a low-cost model that uses a readily available tank and, considering that the systems have to be heated, insulated, and often stirred in colder climates like the UK, this could prove to be significantly cheaper in Africa as those additional features would not be needed. This type of technology has the potential to drastically reduce the cost of fertilizer, which is an issue in African agriculture. The digestif forms a fertilizer which has shown itself to be very effective, sometimes more so than non-organic fertilizer. Trials have shown that it helps the plant absorb more nutrients. While we’re not entirely sure why, there is some speculation that it might have to do with the microorganisms. When the 28

Corporate Africa 2015

organic waste is breaking down in the digester, it is the microorganisms that help with that process. Also, there are similar microorganisms in the soil which are important for plant health. There may be some synergy occurring there that does not exist with renewable fertilizer. In addition, gas is produced 24 hours a day: it is a renewable energy that is called ‘baseload’ which is handy because it can complement other renewable (such as solar or wind power) which are more intermittent and need storage. Ideally, if you can support the solar and wind power with the gas and electricity working together, you can have flexibility with your energy. However, the technology is still undergoing development and we need more communication to find out the needs of farmers in Africa, and what systems would be most useful to them. If we can get the information from farmers then we can make a better product which is economically sustainable, environmentally friendly, and available to use in urban and rural environments. ■

Today, 18 million ton of the UK’s edible food valued at £23 billion (US$ 34.87 billion) ends up in landfill. This resource could help to power and feed cities, making them more sustainable and resilient.

ITU

Mobile Telecom Influences Change in Africa Bob Collymore, CEO of Safaricom Limited, has more than 30 years’ experience working in senior executive roles in the telecoms sector. Here, he discusses Safaricom and the transformative impact of ICT upon Africa.

ver the last ten years, ICT has managed to transform the world we live in, making it interconnected in many – mostly unforeseen – ways. Not only does technology bridge distances between families and friends, but it continues to redefine how we interact and express ourselves. When I was growing up, we used to be told, “If you want to hide information from someone, you put it in a book.” We can all agree that this saying no longer applies, because access to information has moved from the privilege of the few to the universal right of everyone. The story of mobile phones’ transformative impact in Africa can be easily hidden behind the numbers; for instance, the

Corporate Africa 2015

GSM Association says there are over 330 million unique mobile subscribers in subSaharan Africa, equivalent to 38 per cent of the region’s total population. More people in Africa have access to a mobile phone than a toothbrush, or clean water.

The story that is untold about this US$ 49 billion industry is that the mobile phone is transforming people’s lives on a daily basis.

The story that is untold about this US$ 49 billion industry is the mobile phone is transforming people’s lives on a daily basis. I often like to illustrate this effect through the story of Mangooni, a small town along

the Kenyan coast that was revolutionized by a single base station. Prior to Safaricom setting up our station in the area, Mangooni was known for frequent conflicts, often resulting in elephants that would visit the area being harmed or killed by residents who wanted to protect their homes. Following the arrival of our base station, residents can now call the Kenyan Wildlife Service officers whenever attacks occur and get the animal safely removed without much incident. The movement of the animals can be tracked by the community which now has a means to inform each other. As an additional benefit, our base station heralded the arrival of electricity for the first time to the village, and a number of

enterprising young adults have created a communal mobile charging station to ensure that residents remain connected to each other and the world. Mangooni meet Facebook.

Technology continues to redefine how we interact and express ourselves. Further afield in northern Kenya, a different kind of transformative journey is taking place in Daadab: home to one of the world’s biggest populations refugees. For some of the over 300,000 residents, the camp is the only home they have known for two generations.

This is why I was excited to recently participate in the launch of our 4G network – the most advanced of its kind in sub-Saharan Africa – which, for me, is the beginning of a new era of transformational connectivity.

services sector, education, and medical services, among others. 4G will lay the basis for the continued growth of our economies, which are already seeing the fruits of embracing a technology-centric mindset. Enhanced mobile connectivity will buoy the already-growing innovation ecosystem across the continent which is quickly becoming world famous and has seen the creation of solutions that are custom-fit to our subscribers’ needs.

With 4G, we hope to open up a new world of possibilities to not only our customers but also to our partners in the financial

In order to truly democratize data, we must commit to invest in the technologies that have the power to transform lives. ■

we must contribute to invest heavily in building the best networks to connect regions that have never before had a reliable connection to the outside world.

With mobile connectivity, children in the camp can now access a mobile-based education program. The curriculum is available to 13 schools through our Instant Network School program, providing over 18,000 young refugees between the ages of seven and twenty years (many for the first time in their lives) with educative content. For operators like Safaricom, this means

Bob Collymore visits the refugee camp in Daadab where Safaricom is improving lives

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Exhibition & Conference

Speakers include Bizimana Bernard, Technical

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Jessica Kyeyune, National Content Manager, CnooC

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ITU

Bringing Innovators Together ITU Telecom World 2014 took place last October in Doha, Qatar, where 3,500 participants came together to discuss the latest innovations and the future of ICT.

he ITU Telecom World 2014 event featured a dynamic and truly diverse line up of participants from around the world including Cisco, Huawei, Intel, LS telcom, Nokia, Ooredoo, Rhode & Schwarz, Vodafone, and ZTE, with pavilions from Argentina, Azerbaijan, Cameroon, Chad, China, Hungary, Nigeria, Malaysia, Qatar, Tanzania, Thailand, and Zimbabwe, while Kenya, Uganda, South Sudan, and Rwanda came together within the Smart Africa zone on the show floor. ITU Secretary-General, Hamadoun I. Toure said: “I have seen the evolution of a roadmap that provides an immersive, interactive, and deeply informative view of the future of ICTs. This has been evident in the Leadership Summit and Forum, bringing insights into industry shifts and macro trends from top names on the show floor and looking at new technologies developing in The Lab.

Corporate Africa 2015

“I was also deeply impressed by the bright sparks who are building the future of technology and business in the Young Innovators Program.”

“I have seen the evolution of a roadmap that provides an immersive, interactive, and deeply informative view of the future of ICTs.”

Organized by ITU and the UN Specialized Agency for ICTs, the event was hosted by the Government of Qatar with the support of leading international communications company, Ooredoo. “Ooredoo was delighted to work with ITU to organize ITU Telecom World 2014 on behalf of the Government of Qatar,”

said Sheikh Abdullah Bin Mohammed Bin Saud Al Thani, Chairman of the Board of Directors, Ooredoo Group. “Helping host this unique platform for global experts to share views and insights on how we can use ICTs to enhance lives is in line with Ooredoo’s and Qatar’s strategic vision and it has been an inspirational experience. We were also very pleased to be able to showcase our latest technologies to this global audience and to shine a spotlight on Qatar as a global technology hub.” Smart showcases and networking “Huawei was delighted to showcase its visions of ‘Building a Better Connected World,’ outlining a more convenient and smarter lifestyle featuring futuristic 5G connectivity technologies, ubiquitous broadband connectivity, connected smart cities, and smart homes to the global

ITU

audience convened at ITU Telecom World 2014,” said Mr. Ken Hu, Deputy Chairman of the Board and Rotating CEO, Huawei. “At the event, Huawei also shared views and insights on technology, business, and investment model innovation and called for collaboration among stakeholders to rejuvenate global broadband development.” The event featured sponsored sessions from Alcatel-Lucent, BBC, CNN, ESOA, Geddes Consulting, Huawei, IPv6 Forum, ITU-D, Nokia, TDIA, TCCA, and tmforum, and covered a range of different areas from “Big Data to universal broadband,” “enabling the digital future,” “hidden risks,” “unexplored opportunities from circuits to packets,” “LTE for public safety,” “ICTs for saving lives,” and more diverse technology expected in the future.

Forum focus on industry transformation Forum discussion at the event covered the key trends and developments in technology, regulatory, and policy issues, business models, services, and applications

The underlying focus of discussions was around the radical transformation of the ICT industry and hot topics included the different uses for Big Data.

– focusing on three major scenarios of disruption, cross-sector partnerships, and the intelligent future. The underlying focus of discussions was

around the radical transformation of the ICT industry, and hot topics included the different uses for Big Data, including “Big Data for development,” “Mobile networks in the cloud,” the “softwarization for network elements,” “bringing IT into ICT,” cross-sector partnerships, collaboration and cooperation, and broadband rollout in emerging markets. Discussions convened a unique mix of informed speakers from the worlds of government, industry, academia, research, and international organizations, with audience members encouraged to join in, share their insights and experience, and quiz the panels on their views. “ITU Telecom World events convene the right mix of industry players as well as highest-level rep from governments and regulators,” said John Davies, Vice President and General Manager, Intel.

Corporate Africa 2015

ITU “This year, Intel has shared visions with this important audience on crucial issues, from the scarcity of spectrum to the challenges posed and opportunities offered within cross-sectoral partnerships. By working together, our goal is to connect everyone on the planet. The Leadership Summit on the Future launched debates in an eye-opening and inspiring journey into the future of the ICT industry and of our businesses and societies. Renowned futurists and international experts from a range of disciplines came together to explore potential scenarios of the future with leaders of public and private sectors from across the global ICT sector. Led by moderator and futurist, Gerd Leonhard, the Summit gave a unique perspective into where the industry was heading in the next three to five years. According to Leonhard, “We are moving into an exponential future and away from linear changes, as the pace of development means that things we thought were science fiction a very short time ago – such as an app for automatic translation from Japanese to English – are now happening every day.” Some 205 speakers from 52 countries

Corporate Africa 2015

contributed to the discussions in Doha and extended around the world with 2400 tweets from 841 contributors with a reach of over 8 million people. Show floor Leading players discussed new developments. Nokia Networks, Ooredoo Qatar, and China Mobile chose the global platform offered by ITU Telecom World 2014 to achieve a record-breaking

The show floor also included first-time pavilion Smart Africa, which highlighted the Smart Africa initiative focusing on making internet access affordable to all African citizens.

speed of 4.1 Gbps over TDD-FDD LTE, in an experiment to demonstrate future user demand. Vodafone unveiled Qatar’s first virtual store experience. The show floor also included first-time pavilion Smart Africa, which highlighted the Smart Africa initiative focusing on making internet access affordable to all African citizens and the role of the private sector in ICT development partnerships.

Tanzania shone a spotlight on its global ICT sector. Its National ICT Broadband Backbone project has seen Tanzania evolve into a regional ICT hub, providing vital telecoms infrastructure to eight neighboring countries. First-time participant Chad took the occasion to advertise its major ICT projects, such as the African Center of Information technologies (CATI). Nigeria also demonstrated its ICT achievements during the event, under the theme “Broadband Nigeria: Enabling Access, Transforming Communities.” Latest innovations in ICTs address specific issues related to emergency telecoms in Saving Lives and Small Island Developing States (SIDS). The event also saw the launch of the Global Cybersecurity Index 2014. A joint project undertaken by ABI Research and ITU, the GCI provides insights into cybersecurity engagement in countries. Networking was a key component of the event, with delegates from the public and private sectors using the Event App to actively network with other participants and share their experiences and ideas.

Innovation The future of innovation was showcased in The Lab and by winners of the Young Innovators competition. Social entrepreneurs between the ages of 18 to 30 from around the world highlighted innovative digital solutions with positive social impact. “ITU Telecom World was a great opportunity,” said Young Innovator, Hemant Purohit. “I was able to make contacts and receive advice that will be a huge help in taking my work forward. This kind of thing, getting this level of incubation and international exposure, has been a dream for a long time. Now, though, the hard part begins. I have to turn all this into a successful start-up. It won’t be easy, but I have a good start.” Further examples of innovation in action could be seen in The Lab on the show floor, including MineKafon, a windpowered mine detector; Perpetual Plastic Project, an interactive recycling installation that transforms plastic into new products through 3D printing;

Paramedic Hybrid Wall, a responsible surface able to remodel its own shape; and Boreal, an open-source interface that can be used to control all types of hardware and software. Also in The Lab was the humanoid, Roboy, who presented a new face of human robotic interaction and delighted participants with his ability to interact

and move his anthropomorphic, tendondriven arm, as well as his charming blushes, winks, and waves. As the event concluded in Doha, the ITU Telecom World “baton” was ceremoniously handed to Hungary. Conversations that began at ITU Telecom World 2014 are set to continue in Europe next year in Budapest, 12th – 15th October 2015. ■

The Young Innovators competition highlighted innovative digital solutions

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ITU Lycamobile foresees Algeria as an opportunity to increase the economic activity of individuals through reduced telecom costs

high level of infrastructure investment has taken place in Algeria. These are the conditions that a company looking to make an overseas investment, like Lycamobile, find very exciting. I am certain that 2015–2019 will see the fruition of a fully modernized infrastructure in a country that will create opportunities across the field, particularly in our area of telecoms. Lycamobile is a relatively small company. Having achieved a first annual turnover of more than £1 billion (US$ 1.25 billion), an amount that will be approaching £1.5 or £1.6 billion (US$ 2.43 billion) in the second year. The question is: why would we be interested in doing business in Algeria?

Corporate Africa 2015

This is a mobile phone company that, only eight years ago, was the largest Mobile Virtual Network Operator (MVNO). Lycamobile does not build

I am certain that 2015–2019 will see the fruition of a fullymodernized infrastructure in a country that would create opportunities across the field, particularly in our area of telecoms.

infrastructure but we partner with many of the world’s leading mobile operators as a prepaid mobile SIM card provider, with 12 million loyal

customers who bought our products in 19 countries around the world. The company’s two most recent products were launched in 2014 in Romania and Hong Kong. Like a global brand, our mobile brand is synonymous with connecting customers with their loved ones across the world at the lowest possible cost and highest possible quality. One of the features of the Algerian market for international calling is that there are great improvements that could be made without compromising income in the market which will not affect cost in terms of quality. We are able to bring this product to market by interconnecting with mobile operators and with over 100

ITU

Chris Tooley, the CEO of Lycamobile, has pioneered many technical, legal, and commercial industry standards for prepaid products in Europe. Now, he is looking to set up business in Algeria.

Expanding Global

Commnication international characters by creating customer service centers that speak multiple languages: Algeria is a very interesting country to build call centers in. As a consequence of that, we are able to have greater coverage within the European market. A lot of our customers – particularly in countries like France, Spain, Italy, and the UK – have large numbers of Algerian customers currently using our services. We plan to build on those customers by being able to offer them lower cost, more efficient communications in Algeria and to reciprocate with the people they’re calling to make international calls out of Algeria. This is an underserved market at the moment, which is typical of many emerging markets. Lycamobile has become the world’s largest international MVNO. MagicJack is merely operating in the US market, Virgin operates across multiple ownership in many countries, and we have the intention of expanding in

North Africa, sub-Saharan Africa, and in South America to become the world’s largest MVNO of any description. Enormous migration has taken place over the last 20 years in countries where we operate, which has created a huge dynamic market of people who

We are very comfortable that the environment we’re going into, in terms of infrastructure and telecoms, is going to be a very strong and vibrant economy.

have access to income which enables them to call back to their countries of origin at a very low cost and spend longer periods of time on the phone. By enabling people to do this, Lycamobile will increase economic activity. The opportunity we foresee in Algeria is the opportunity to increase

the economic activity of individuals through reducing the cost of telecoms while increasing the overall revenue of telecoms in that country. We partner with many of the world’s leading brands, over 30 mobile operators, many of whom are household names: companies like Orange, O2, and Vodafone. The operators who carry out business in the Algerian market have also demonstrated their world-class capabilities by being able to attract very good international investments. We are very comfortable that the environment we’re going into, in terms of infrastructure and telecoms, is going to be a very strong and vibrant economy: one which is set to account for approaching eight per cent of the country’s GDP in the coming years. The government has made a significant commitment to achieve this goal and ensure that there are good opportunities available for companies to share in the country’s growth. ■

Corporate Africa 2015

Infrastructure Sustaining Africa’s enormous potential for growth is only possible with significant investment in infrastructure

Investing in African The Private Infrastructure Development Group (PIDG) is an innovative, multi-donor organization that encourages private infrastructure in developing countries, contributing to their economic growth and poverty reduction. Philippe Valahu is the Executive Director of PIDG.

nfrastructure is the vital foundation upon which people start businesses, transport goods to new markets, create employment, boost tax revenues, and grow economies. The effective development of infrastructure transformed the fortunes of Europe and America in the 19th and 20th centuries and has been vital to Asia’s recent economic ascendancy. With a population of over 1 billion, a growing middle class, and natural resources surpassing every other continent, Africa has enormous potential for economic growth. The past 20 years have seen improvements in governance, transformative mobile technologies, and global demand for natural resources which has powered African economic growth.

Corporate Africa 2015

However, sustaining or accelerating this growth is only possible with significant investment in infrastructure. In particular, Africa needs to invest in energy and transport to fuel growth and better integrate with the global economy.

PIDG has consistently risen to the challenge of attracting investment to countries with the greatest need for infrastructure but where perception of risk has frequently deterred private sector investors.

The African Development Bank has estimated that addressing Africa’s

infrastructure deficit requires investment of almost US$ 100 billion every year for the next decade and that the current annual shortfall in funds is more than half that amount. While greater efficiency in the use of public funds could help to address the financing gap, it will not sufficiently meet all of Africa’s future infrastructure funding needs. Private financing needs to be mobilized if Africa is to achieve its vast economic potential. Bridging the gap is a core commitment of the Private Infrastructure Development Group (PIDG). For more than a decade it has built on the insight and belief that tackling poverty sustainably requires longterm investment in infrastructure in order to allow economies to grow and prosper.

Infrastructure

Its founders (a group of public development agencies) understood, and year after year we have sought to demonstrate that economic growth is critical to lifting individuals and nations out of poverty. PIDG comprises of eight national development agencies and the IFC, one of the World Bank Groupâ&#x20AC;&#x2122;s private sector arms. Together they commit funds, which are invested through a portfolio of eight Facilities run by private sector managers. Each of these Facilities has a distinct remit but with shared aim to mobilize and increase flows of local, regional, and international investor capital; to lend; and to bring expertise and resources needed for infrastructure investment. PIDG actively encourages innovation, creativity, and entrepreneurial spirit to respond to prevailing market conditions. With its focus solely on infrastructure development (concentrating on low-income and fragile countries), PIDG has established

access to basic infrastructure services like power, transport, water, sanitation, and communications. To date, PIDG members have committed public funds in excess of US$ 1 billion and PIDG Facilities leveraged that to mobilize US$ 27 billion from other Development Finance Institutions (DFI) and the private sector. More than 100 projects have reached financial close and 46 are now

after-effects of the global financial crisis and underscores the importance of the work PIDG undertakes. The impact of the financial crisis was felt globally. In Africa, it has confirmed the urgency of massive and sustained effort to improve infrastructure development across the region.

The past 20 years have seen improvements in governance, transformative mobile technologies, and global demand for natural resources which has powered African economic growth.

While there are deficits in spending across the full range of African infrastructure requirements, by far the largest investment and need is in the energy sector. According to the World Bank Group, sub-Saharan Africaâ&#x20AC;&#x2122;s 48 countries (with a combined population of 800 million) generate the same amount of power as Spain (45 million). Power cuts are a regular feature of daily life in many African countries; rural communities in particular are without access to power or endure sporadic, unpredictable supplies.

delivering a range of new and improved services in power, transport, agri-

Reliable and cost-effective supplies of energy will be essential for countries across Africa to participate and benefit from

Infrastructure a strong track record in developing and funding projects in frontier markets. PIDG has consistently risen to the challenge of attracting investment to countries with the greatest need for infrastructure but where perception of risk has frequently deterred private sector investors.

infrastructure, and manufacturing to local people and businesses. Thirty-three of those projects are in Africa. The environment PIDG operates in inevitably continues to be shaped by the

increased trade and economic growth. It is especially, a vital necessity for SMEs. Recognizing the need for investment in energy, Green Africa Power (GAP) is the latest PIDG Facility to be established.

In these under developed markets, PIDG members invest public funds to leverage domestic and cross-border private sector finance in infrastructure projects which are expected to stimulate pro-poor economic growth and improve the access to services of those living in some of the poorest countries. While PDIG seeks to tackle major institutional market obstacles hindering private sector participation, its projects demonstrate to the private sector that investment in low- and middle-income countries is commercially viable and able to deliver real benefits to those living without Corporate Africa 2015

Infrastructure PIDG can take the lead, demonstrating that investment in infrastructure in lower income countries can be viable and the risk profile may not always be as high as perceived. Green Power Africa is the latest PIDG facility to be established Open for business in November 2014, it is a mezzanine-financing fund. It is designed to address key market failures in the power sector to stimulate private sector investment in renewable energy by reducing the overall cost of capital for energy generation projects, maintaining commercial returns.

environments and greater scrutiny of aid spending. Consequently, there is a growing interest in contributions private sector enterprise can make to poverty alleviation and an understanding that there is a need to further leverage the existing sources of finance (official or commercial) with alternative sources of debt and equity.

GAP has an ambitious target to finance 240MW of renewable energy generation capacity, saving 9 million tonnes of carbon emissions and improving the supply of clean energy to millions in sub-Saharan Africa. Through selected investments, GAP will demonstrate the economic viability and technical feasibility of new technologies and encourage investment by private investors in sustainable business models and economies of Africa.

PIDG is uniquely placed to build on its successful track record, engaging the private sector, mobilizing and delivering sustainable commercial returns on investments in some of the poorest countries in the world, securing measurable poverty reduction, and economic growth.

The need for targeted funds has increased in recent years. International Financing Institutions (IFI) face capital constraints and commercial banks are below precrisis levels as they deal with weak balance sheets and regulator pressure to avoid or limit long-term structured finance. Traditional donor also experiencing 40

governments are constrained fiscal

Corporate Africa 2015

The continued need for significant infrastructure provision investment requires the pursuit of alternative sources of capital including private equity funds, sovereign wealth funds, social impact, and local investors. Currently, new players are looking to enter the market but not necessarily at the frontier.

PIDG can take the lead, demonstrating that investment in infrastructure in lower income countries can be viable

and the risk profile may not always be as high as perceived. It often can be managed through risk mitigating measures. PIDG and its funding members remain committed to tackling poverty by mobilizing private investments for vital infrastructure. Securing that infrastructure remains key to sustainable prosperity and economic progress for Africa. â&#x2013;

Reliable and cost-effective supplies of energy will be essential for countries across Africa to participate and benefit from increase trade and economic growth.

PIDG has published a case study on one of its Facilities, InfraCo Africa, which elaborates on the partnership with Cenpower Holdings to develop a 350MW Combine Cycle Gas Turbine Plant in Ghana: The Kpone Independent Power Plant (KIPP). The case study has since been recognized as the most outstanding African power deal of 2014 and is available to read on the Corporate Africa website: www.corporate-africa.com

Infrastructure

Ethiopia’s Light Rail Transit Project Africa’s first light rail transport system is set for completion in Addis Ababa, Ethiopia, during 2015. Ethiopian Railways Corporation’s Communications Director, Dereje Tefera, speaks to Corporate Africa about the project.

he Addis Ababa Light Rail Transit System is considered by the government as one of the strategic projects to alleviate transportation problems in Addis Ababa. In the northsouth route, the system runs from the Menilik II roundabout to the Kaliti area and the east-west route runs from the Ayat district to the Torhailock roundabout. The total length of the railway is 34km.

by the EXIM Bank of China as a soft loan to be paid over the long term. The remaining is covered by the Ethiopian government. Once the project is over, it will be managed by an internationally recognized management company. We have tendered a bit for that purpose and are currently identifying the right companies. We’re doing this because we do not have the local expertise and know-

The project was launched more than two years ago and it will be completed in January 2015. This doesn’t mean that the system will be open for public use right after it is finished since it will be tested for some time. Work will be carried out to make sure that the system is working properly to avoid any risk of accident.

The project is worth over US$ 470 million, 85 per cent of which is provided by the EXIM Bank of China as a soft loan.

The contract is being carried out by the China Railways Group under an EPC turnkey arrangement. Once the trial period is over, the contractor will hand over the rail system to the Ethiopian Railways Corporation (ERC). The project is worth over US$ 470 million, 85 per cent of which is provided

how to manage the system at the moment. The company that wins the bid will initially run the system for a period of three to five years. Parallel to this, Ethiopia will work on building local capacity and acquiring the know-how to run the system competently and independently. Currently,

some

254

Ethiopians

are

receiving training in China for this purpose. Once they complete the training, they will work with the managing company to gain practical experience. The light rail project is governed by the contract signed between China Railways Group and ERC. There is a clear timeline for beginning and completing the project. Any delay will have repercussions for the contractor, including additional costs. But the project looks set to finish as scheduled. The main part of the project is the work done on the ground, which is almost finished. Most of the bridges in the system have been finalized. Electric lines and the track lanes are now being installed. Synchronization of the electro-mechanical and signaling systems is also being carried out and that will not take much time to complete as the equipment needed for the purpose is being imported. The 41 light rail vehicles needed for the system are also being imported (one of them has already reached Djibouti) and most of the stations along the rail line have also been constructed. The trial period will end as soon as possible, though no date has yet been set for this. The period allows for glitches to be ironed out ready for commuters. Our desire is to see the system fully secure and operational as soon as possible, allowing us to move to another project. The bid for the management of the railway system was international, so it was open to any company with the expertise. Interested companies that qualify for the bid have applied and the bidding committee is now carrying out its technical and financial evaluations.

Testing time at Ethiopia Light Railway

Corporate Africa 2015

The Ethiopians receiving management training in China are doing so with the aim of taking charge of the entire system. After completing their training, they will first

The management company will contribute to building human resource capacity by coaching Ethiopians. The focus on better skills and experience will help ensure the safety of the systems. The light rail system will have 41 vehicles operating on double-track lines. The entire system can transport up to 60,000 commuters at a time. The areas the rail lines cover are places where there is high mobility in the city. Each train is 30 meters long and can carry 300 people. The system is in line with the country’s green development strategy as it is powered by electricity. Not only is it environmentally friendly, but it will also save foreign exchange spend on fuel. The project so far has created opportunities for some 3900 citizens and will, when operational, create more jobs. The system will definitely alleviate the transportation problem, though it will not wholly cure it. Given the fact that Addis Ababa is the seat of the federal government and other international organizations, the light rail system will modernize the city’s transportation system. The rail system will also create an opportunity for citizens to acquire technology in rail transportation. ERC is currently training Ethiopians in railway engineering at postgraduate level. The first batch, consisting of some 160 trainees, graduated on 11th October 2014. This is an opportunity the rail transport sector created, and we will build upon it.

by electricity, can carry freight of 3500 to 4000 tons at a time. The cost of transporting a cargo of such volume with trucks is much more considering the amount of time it takes and the money spent on fuel and spare parts. This will obviously have a significant impact on the country’s economy. Rail transportation will cut costs substantially. It will also provide foreign investors with an efficient means to transport goods to and from factories and markets. Railway is a fast and cost-effective means of transportation. This fiscal year, there will be performance assessments of targets and projects set in the country’s Growth and Transformation Plan. Once the government is through with the assessment of the successes and challenges of the first phase of the rail system, there will be a phase-two project

Given the fact that Addis Ababa is the seat of the federal government and other international organizations, the rail system will modernize the city’s transportation system. to expand the rail lines. But first, we will measure the economic situation and the wills of lenders. Currently, there are no plans to issue stocks for capitalization purposes. The option we are looking at to cover the operational cost of the city’s rail system is what is called Transit Oriented

Infrastructure

work under the international management company who will be in contract with the ERC. This will allow them to gain better practical skills to manage the system on their own in the future.

Development (TOD). Under the scheme, which is still being studied, different income-generating facilities such as malls and supermarkets will be built at some of the stations along the rail line. It could be one option to secure income in addition to what is generated from the sale of tickets. Ticket income is barely adequate to cover operational costs. The main aim of the rail system is to provide residents of Addis Ababa with an additional affordable transport option, which leaves the country with a budget deficit. The TOD could be one option to fill it. Space makes development possible, and the project is a result of development in Ethiopia. This will, in turn, attract more foreign investors into the country. Building the light rail system is challenging and is like rebuilding the entire city. Residents of Addis Ababa have been very cooperative in this regard. They have tolerated the demolition of roads and buildings as well as temporary interruption of basic services like electricity and water supply hoping that the rail system will bring better benefits later. This shows that the public is genuinely committed to development. It also shows the government’s commitment to development and that the country is positioning itself to attract foreign investors. Without economic development, it is difficult to think of such mega projects, let alone build them. ■

Transportation is the blood line of a country’s economy and development. Unless there is a smooth and efficient transportation system, there will be a negative effect on the country’s economic growth. That’s why ERC is engaged in transnational railway projects in addition to the light rail system in Addis. The rail line that runs from Sebeta (a town 25km west of Addis) to Djibouti will facilitate import and export of goods along that route. A trip along this line takes truck drivers five to seven days, but a train can cover the same distance in just ten hours carrying far more cargo. This rail system, which is also powered

Addis Ababa Light Rail track

Corporate Africa 2015

Infrastructure

Under African Skies E

thiopian Airlines’ 2025 Vision is “to become the most competitive and leading aviation group in Africa by providing safe, market-driven, and customer-focused passenger and cargo transport, aviation training, flight catering, MRO, and ground services.” There are few companies which would set themselves 15-year plans as ambitious as our 2025 Vision, but Ethiopian Airlines chose to do this fully recognizing the dynamic and changeable business environment. Our plans make allowances for adaptability to changes, which will and has allowed us to become a safe, customer-driven, profitable, and leading African aviation group. We set the bar high for ourselves because we know that we are capable of attaining our goals. Aviation is the facilitation of mobility and a driver of economic growth:something we took into account when we planned out this vision. Fulfilling it requires building on a foundation consisting of infrastructure, systems and procedure, human resource development, and fleet development. We have specific goals we would like to achieve in the number of aircraft, passengers, and amount of revenue we acquire. We have done our homework and know that, by 2025, Ethiopian Airlines plans to attain gross revenue of US$ 10 billion, 18 million passengers, 17 million employees globally, operate 120 aircraft, and fly to 140 destinations.

Corporate Africa 2015

Ethiopian Airlines CEO, Mr. Tewolde Gebremariam

Ethiopian Airlines is among the few public sector corporations in Africa that have found international success. The 70-yearold company is Africa’s leading airline, connecting all regions of the continent. Esayas Woldemariam, Ethiopian’s Managing Director of International Services, analyzes the company’s success and future developments. Currently, we are close to US$ 3 billion in revenue and operate in 84 destinations. We operate 75 aircraft, including cargo planes, which does not include the new aircraft we have ordered

that will form part of the fleet of 120. The airline recently added a tenth Boeing B787 Dreamliner to its fleet, becoming the second airline in the world after Japan to receive and operate the

Infrastructure We operate 75 aircraft, including cargo planes, which does not include the new aircraft we have ordered that will form part of the fleet of 120.

including 737-700s, 800s, and next generations from the Boeing family. As a hub-and-spoke operator, we bring passengers from the Middle East, Asia, Europe, and America to Addis Ababa and take them on to central, west, east, and southern Africa. We need to have different sizes and types of aircraft to fit different routes. A350s are for mediumto long-range routes to destinations such as Dakar, Abidjan, Mumbai, Delhi, Madrid, and Rome. The 777-200s and 777-300s go further, to Beijing, Seoul, Shanghai, Washington DC, and Stockholm. Recently, Ethiopian Airlines established a new route from Dublin to Los Angeles.

China is our primary focus. We have 28 flights per week to gateways such as Shanghai, Beijing, and Guanzhou and more are planned to Chengdu and Chongqing. aircraft. It is a very appealing aircraft for shareholders, customers, and the environment. This new technology is constructed out of a cloth-like composite which is very light but hard. As a result, fuel consumption is muchreduced, which is cost-saving and makes us competitive enough to reduce our prices for the price-sensitive segment of the market and generate market share. This also results in lower emission levels of greenhouse gases. For the customers, the 787 Dreamliner is a new experience. Not only does it

reduce the feeling of fatigue being at 40,000 feet to 7,000 feet, but it has the widest windows in the sky with its own darkening and lightening facilities rather than shutters. The wide cabin is fitted with sky interior lights for ambiance. These are some of the aircraftâ&#x20AC;&#x2122;s benefits that give good competitive edge. Our fleet plan is well thought out and diversified in its economics from ownership costs to route structure and carrying capabilities. For all of that, we have variety of fleet composition

Dublinâ&#x20AC;&#x2122;s service to Africa is very scanty and people usually have to go through London, Heathrow. Given that Ireland has economic partners in Africa, including Ethiopia, a direct service was lacking. Furthermore, Dublin has given us the traffic right to embark and disembark passengers between Dublin and Los Angeles as their national carrier, Aer Lingus, operates in San Francisco on the West Coast. The intermediate stop is convenient as Addis Ababa is a high-altitude station and a technical stop is needed to prepare Corporate Africa 2015

Infrastructure airlines are concentrating on Africa, so we have to grow fast and defend our African market base and share. For that reason, we are bringing in pilots from the international market, and currently 10 per cent of Ethiopian Airlines pilots are from foreign countries. They supplement our shortage and fuel our growth. When all those who are currently training complete their courses, we can fill the positions with local employees. The interior of the Boeing 787 Dreamliner, a recent addition to the Ethiopian Airlines fleet for the sea-level airport in Los Angeles. We have been considering extending routes into Chicago, New York, Atlanta, and Houston due to the traffic volume they generate. However, as we already operate in Toronto and Washington DC, we will be working on our frequencies before diversifying our US destinations. There is also an intention to reinstate Athens as a destination, and extend routes to Geneva and Oslo.

Although the Ebola-affected countries are in a region which is much closer to Europe than to east and southern Africa, tourists are scared to come here.

The eastern hemisphere is a region of economic growth and those countries are increasingly strengthening their cooperation with Africa. China is our primary focus. We have 28 flights per week to gateways such as Shanghai, Beijing, and Guanzhou and more are planned to Chengdu and Chongqing. China-Africa relations are growing fast, as are those with India. We have 14 flights a week to Mumbai and Delhi which weâ&#x20AC;&#x2122;re planning to increase as well as creating routes to Chennai and Madras. The airline will be concentrating on opening up Japan, introducing

Corporate Africa 2015

Singapore, and Kuala Lumpur, and have plans to go to Manila, Jakarta, Bangkok, and Hong Kong. For all its success and ambition, Ethiopian Airlines has also faced challenges starting with the facilities here at our home base. When our station at Addis Ababa was inaugurated in 2003, the capacity was envisaged to last for 20 years but in half the time, in 2013, we outgrew the capacity. That is a good problem, a good challenge, to have. The airport enterprise is also a very good industry partner and they are trying to patch-up work for expansion to catch up with our growth. Additional aircraft parking spaces are being built as well as additional gates, bus terminals and remote parking places. The government is also looking to relocate the airport 100 km south of Addis Ababa at a lower altitude to reduce the challenge of high altitude and payload performances penalties. Part of the challenge has been the increase in human resources productivity. Professions like aviation require accumulation of a lot of wisdom, flying hours, and experience. We have to wait until we have opened our inlets to train flight engineers, mechanics, pilots, and so on but it requires time for them to grow and gain that experience. We cannot wait because the Middle Eastern

The outbreak of Ebola in West Africa severely affected flights in the African region in 2014, impacting Ethiopian Airlines. Although the Ebola-affected countries are in a region which is much closer to Europe than to east and southern Africa, tourists are scared to come here. We are far from the affected area, but there is a negative perception of the whole continent. When the traffic reduces, we cut back some frequencies and deploy the aircraft to charter and ad hoc operations in order to cover costs. Fortunately, we have not had to suspend any flights as we do not operate in Freetown, Monrovia, and Conakry. We are not the only ones affected: general traffic from America, Europe, and Asia has reduced because some countries will not give visas to many Africans for fear that they are carrying the illness. Although our Chief Financial Officer has the dollars and cents arranged very well, it really has had an impact. The reduction of expected revenue in the first quarter of our performance is US$ 8 million. Our primary concern is for our passengers, crew, employees, and communities where we operate. We follow strict guidelines by IATA, ICAO, WHO, AFRA, the AU, and the Ethiopian government policy. They impact the way we educate our crews and put in all the necessary equipment and facilities. At the intermediate transit point in Addis Ababa, there is a big consortium group

Infrastructure

African countries need to develop their infrastructures, aviation facilities, and airports; strengthen their security; and build their capacities. Esayas Woldemariam, MD Ethiopian International Services of establishments like the Ministry of Health, the Customs Authority, Immigration, and Security which use temperature-detecting machines. We comply with all international, regional, and national compliance policies to avoid the spread of such pandemics. The majority of African traffic is currently being carried by non-African airlines. A decision was made by African nations in Yamoussoukro, Côte d’Ivoire, which intended to liberalize the African skies for African airlines which almost all African countries have ratified. However, some have not implemented it yet. Instead of giving all the flying rights to foreign carriers, these nations should help each other and strengthen the industry by implementing the Yamoussoukro Decision. Ethiopian airlines is trying to spearhead the Pan-African Aviation Movement by setting up regional hubs in Lilongwe, Malawi, and Lome, Togo, as well as other destinations to collect traffic and feed it to the main gateway. By doing so, we can defend the traffic for African airlines. African countries need to develop their infrastructures, aviation facilities, and airports; strengthen their security; and build their capacities.

African aviation will prosper if African carriers work together. For example, Europe negotiates as a bloc, as the EU, so if they negotiate with country X in Africa, all European carriers can go to that destination. Africa definitely needs to work as a bloc as well. Aviation – facilitating the movement of people and goods – will also facilitate economic growth and regional cooperation. Export out of Africa will be strengthened and import within Africa, eased. African countries are only trading 10 per cent with each other and 90 per cent with other continents. Furthermore, the movement of goods using ground transport is a problem because it is costly and railways and roads are not well connected. Three kilometers of runway takes less investment but results in more connectivity. The success of a business should not be determined by the ownership structure. In many African countries, governmentowned national carriers have not succeeded largely because governments may be intervening in decision-making, fleet acquisitions, employment, and so on. Ethiopian Airlines has turned this into an opportunity because the government has given autonomy to management.

The management conducts the business according to international aviation economic discipline while the government facilitates matters when negotiating bilateral air rights with other countries, for example. The government gives support and does not intervene, making it an advantage rather than a liability.

Good synergy exists between our airline and the government which is why we are a prime example of how good partnership and company structure can lead to success in this industry.

The government’s Growth and Transformation Plan (GTP) stipulated that we have to have a certain amount of export of flowers, fruits, vegetables, and meat to the Gulf. It takes into account Ethiopian Airlines’ capabilities and we take these requirements into account in our 2025 Vision. Good synergy exists between our airline and the government which is why we are a prime example of how good partnership and company structure can lead to success in this industry. ■

Corporate Africa 2015

Infrastructure

Modderfontein New City South Africa’s city of the future

2015 witnessed the start of construction of Modderfontein New City in Gauteng, South Africa, which plans to meet the needs of a fast-growing middle-class. Project financier, Zendai Development South Africa’s CEO, Anthony Diepenbroek, explain their plans for the city.

Artist’s rendition of Modderfontein New City

odderfontein New City will be driven by the twin needs of access to information technology and viable integrated public transport systems. Both of these factors are aligned to prevailing development principles which demand that population densities maximize economic delivery of services: the higher the population density, the less the cost of delivering what are the cornerstone requirements of any major new urban development. South African lifestyles are changing. Many households are facing challenges associated with urban sprawl. People wishing to own homes are finding that, to afford a suitable home, they are forced to live outside urban centers. The result of this is that numerous families are allocating an estimated 40 per cent of their monthly income to transport. A reduction in transport costs, as a percentage of monthly income, allowed the saving to be diverted into housing and household expenses. Clearly, if this is done in an environment with convenient access to

Corporate Africa 2015

recreational facilities, the overall outcome becomes an attractive living and working environment.

well serviced precinct. The retirement community will be integrated with leisure and commercial mixed-use options.

Modderfontein New City plans to house an estimated 100,000 new residents in a

The master plan outlines several key functional districts, which are the financial and commercial districts, an international exhibition district, tourism and leisure district, a retirement community, a residential district, and light industrial and logistic parks.

Modderfontein New City will be driven by the twin needs of access to information technology and viable integrated public transport systems.

vibrant and dynamic environment where they can live, work, shop, and play in one complete community. It seeks to cater for both low and high density housing units (like residential apartments close to transport nodes) as well as for the retirement sector by providing a range of retirementrelated development options within the

The development is a bold move to create an “economic ecosystem” with each of the districts having a multiplier effect on other businesses in the neighborhood. The development plans for the New City are also in line with the City of Johannesburg’s new spatial vision and SA’s National Development Plans. Main centers are based on Transit-oriented Development and the shape of the future city will consist of well-planned transport arteries linked to interchanges.

Infrastructure

The transparency and rigor of our processes has meant that we have been able to address any concerns (such as pollution or the sale of land to a foreign company) as soon as they arise. While it may be that the land was acquired by Shanghai Zendai, the development is going to be managed by Zendai Development South Africa, the local subsidiary. Contracts to suppliers, both local and international, will follow due processes and will comply with regulatory and local government requirements. Local communities will benefit from the construction activities as well as the procurement of construction materials. The model is skewed toward local growth; this includes the on-selling of parcels of land to independent developers. We expect the project to create significant downstream opportunities for students in artisans’ institutes in the vicinity. It is important that we work with local communities and ensure that benefit is to the community. Our model for Modderfontein New City is simple – we want to make a direct and meaningful contribution to economic and social inclusion by growing and employing local talent. Where required skills are not available in South Africa, we would look at the global pool. However, we will have a program to ensure that these skills are transferred to South Africans. As a business, we are committed to meeting the prescribed employment benchmarks and are cognizant of the country’s growth plans. In the past, Chinese companies have been criticized for creating infrastructure which benefits their endeavors rather than the local community. One of the things Zendai did early on in the project was to address this misconception by actively engaging (current and future) stakeholders. The project is driven by a will to reinvigorate the Modderfontein area and open it to a broader community: to people who didn’t expect Modderfontein to serve a lifestyle on par with similar international developments. It does challenge that criticism as this is meant to be a contemporary precinct which balances the old and the new. Modderfontein New City is Zendai’s second major transaction outside of China and Hong Kong. We are currently engaged in Phase 1 of a residential and commercial development project near Auckland, in New Zealand. The 32ha development will have a floor area of 170,000m2 , 1000 apartments, a hotel, and office accommodation and is expected to be completed in five years.

We have delivered high quality residential and commercial properties in Shanghai and in other cities along China’s eastern coast including Hangzhou, Nantong, and Nanjing. We have also built landmark hotels in Shanghai such as the Radisson and the Himalaya complex. The latter comprises a five star hotel, a shopping mall, offices, and a center for fine art and the performing arts. Over the past 20 years, Zendai business has grown to include a comprehensive property portfolio with projects in over a dozen main cities in China and an overall development space exceeding 5 million square meters. In the broader context of BRICS, yes we can say that there is cooperation via membership. The BRICS are both the fastest-growing and largest emerging market economies. They account for almost 3 billion people, or just under half of the total population of the world. In recent times the BRICS have also contributed to the majority of world GDP between them. The membership also guides SA and China business conduct.

The development is a bold move to create an “economic ecosystem” with each of the districts having a multiplier effect on other businesses in the neighborhood.

The growth of this group demands that a new integrated approach to development is adopted. The previous system of creating arteries along which people travel to existing urban centers from outlying areas will simply not be able to cope in the medium- to longterm. A system of high-density spines is the only sustainable solution: this solution is aligned with the City of Johannesburg’s “Corridors of Freedom” spatial vision. Considered development like Modderfontein New City is where the future lies. ■

Africa is growing rapidly. Estimates indicate that the present population will double by 2050, when the continent will be home to about 25 per cent of the world’s population. The middle class is burgeoning across the continent. South Africa, proportional to its population, has the largest amount of middle class people on the continent, boasting about 8.3 million civilians.

Corporate Africa 2015

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FOR FOR MORE MORE INFORMATION INFORMATION PLEASE PLEASE FORCONTACT: MORE CONTACT: INFORMATION PLEASE CONTACT: FOR MORE INFORMATION PLEASE CONTACT: Aisha Aisha Aingal Aingal Aisha Aingal Joy Joy Ogbuehi Ogbuehi Joy Michael Michael Ogbuehi Ampe Ampe Kofi Kofi MichaelMelaine Ampe Melaine Kofi Kouassi Kouassi Melaine Kou Adam Parker JoyRegional Ogbuehi Michael Ampe Kofi Melaine Kouassi on Conference Conference Coordinator Coordinator onon Conference Regional Coordinator Coordinator Coordinator on onon Regional Ghana Ghana Representative Representative Coordinator on onon Ghana Francophone Representative Francophone Francophone Conference Coordinator on +44 2070898830 Regional Coordinator on Ghana Representative 2037589170 +44 +44 2070898830 2070898830 +234 +234 8033536288 8033536288 +234 +233 +233 8033536288 240695791 240695791 on +233Francophone 240695791 +225 +225 06178275 06178275 +225 061782 +44 2070898830 +234 8033536288 +233 240695791 +225 06178275 aisha@corporate-africa.com aisha@corporate-africa.com aisha@corporate-africa.com joy@corporate-africa.com joy@corporate-africa.com joy@corporate-africa.com michael@times-publications.com michael@times-publications.com michael@times-publications.com melaine@times-publications. melaine@times-publications. melaine@tim christopher@corporate-africa.com joy@corporate-africa.com michael@times-publications.com melaine@times-publications.com

Oil & Gas

SPDC Agrees Settlement Oil giant, Shell, announced in early January that its Nigerian subsidiary had reached a settlement agreement with the Bodo Community from Nigeria’s River State over two oil spills in 2008. Managing Director, Mutiu Sunmou, comments.

initial settlement efforts failed “mainly as a result of the grossly exaggerated nature of those claims, which at one point exceeded £300 million (US$ 456.44 million).”

The spills took place on the DomuBonny Pipeline and were both caused by operational failure of the pipelines. SPDC accepted responsibility for the incidents when an independent Joint Investigation Team determined the cause.

The US$ 83.68 million settlement provides for an individual payment to each claimant who accepts the settlement agreement in compensation for losses arising from the spills, amounting to up to £35 million (US$ 53.25 million) in total. The remaining £20 million (US$ 30.43 million) payment will be made for the benefit of the Bodo Community generally.

hell’s Nigeria subsidiary, The Shell Petroleum Development Company of Nigeria Limited (SPDC), recently announced a £55 million (US$ 83.68 million) settlement agreement with the Bodo Community in respect of the two operational spills in late 2008.

In 2011, members of the Bodo Community brought claims against SPDC in the UK courts for environmental pollution. The claimants are represented by a London law firm, Leigh Day & Co. According to Shell,

The US$ 83.68 million settlement provides for an individual payment to each claimant who accepts the settlement agreement in compensation for losses arising from the spills.

“From the outset, we’ve accepted responsibility for the two deeply regrettable operational spills in Bodo. We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement,” said Mutiu Sunmou, Managing Director of SPDC. “We are fully committed to the clean-up process being overseen by the former Dutch Ambassador to Nigeria. Despite delays caused by divisions within the community, we are pleased that cleanup work will soon begin now that a plan has been agreed with the community.

“We’ve always wanted to compensate the community fairly and we are pleased to have reached agreement.” - Mutiu Sunmou, Managing Director of SPDC. “However, unless real action is taken to end the scourge of oil theft and illegal refining, which remains the main cause of environmental pollution and is the real tragedy of the Niger Delta, areas that are cleaned up will simply become re-impacted through these illegal activities. “SPDC has made great efforts to raise awareness of the issue with the government of Nigeria, international bodies like the United Nations, the media, civil society, and international non-governmental organizations, and we will continue to play an active role in the search for solutions. We urge all those with influence, including the Bodo Community leaders and NGO groups, to support this effort.” ■

Corporate Africa 2015

Oil & Gas

AFRICA OIL & GAS AWARDS 2014 The Africa Oil & Gas Awards look to honor outstanding contributions to the industry made by some of its key players. The ceremony took place at the Sandton Convention Centre last October in Johannesburg, South Africa.

n 2014, eight solutions and service provider awards and three awards for operating companies were up for grabs.

New Technology of the Year Award, Manufacturer/Supplier of the Year Award, Law Firm of the Year, and Recruitment Agent of the Year.

The award categories for contractors and service providers are: Drilling and Well Services Company of the Year, Oil and Gas Logistics Company of the Year, Engineering Company of the Year, Innovation of the Year Award, Best

One of the main themes across the sector is the integration of local communities and local talent. The recruitment process is key to these challenges.

Corporate Africa 2015

The first award of the evening was Drilling and Services Company of the Year, which went to Maersk Drilling. Judges made reference to their stateof-the-art drilling rigs and their unwavering consistency over the last 40 years. Doing good business in Africa demands a thorough understanding of each countryâ&#x20AC;&#x2122;s systems and cultures.

Oil & Gas

Judges commented on DHL Express Sub-Saharan Africa (DHL SSA)’s impressive record, noting that they had smooth running operations in every territory of sub-Saharan Africa.

The Oil & Gas Logistics Company of the Year went to DHL Express SubSaharan Africa (DHL SSA). Judges commented on their impressive record, noting that they had smooth running operations in every territory of sub-Saharan Africa. The award for Engineering Company of the Year was handed to Wood Group for their list of world-class projects over the last year. Drillmec’s new generation, fully automated rig which will contribute to around a 50 per cent reduction in footprint won Best New Technology of the Year. The Manufacture/Supplier of the Year Award went to SoluForce for originality in the design of their Reinforced Thermoplastic Pipe (RTP). The hotly contested Law Firm of the Year Award received the most submissions, with ENSafrica coming out on top. Judges referred to the assistance ENSafrica have lent to IOCs in pursuing new venture-related opportunities in Africa, as well as their legislative contributions and work with African governments.

One of the main themes across the sector is the integration of local communities and local talent. The recruitment process is key to these challenges. Recruitment Agent of the Year recognized NES Global Talent for their contribution to the employment of high numbers of local candidates in Africa’s energy sector, while the Innovation of the Year Award went to Meta Downhole for their contribution to Pre-salt acreage, as well as drilling deepwater and ultra-deepwater in West Africa. Three awards dedicated to the operating companies were Local Content Initiative of the Year, Corporate Social Responsibility Initiative of the Year, and Exploration and Production Company of the Year. Tullow Oil was the well-deserved winner of the Local Content Initiative of the Year for their continuous effort toward economic and social development in the countries in which they operate. The award for Corporate Social Responsibility Initiative of the Year was

bestowed upon OMV for their bold and hands-on approach to the Libya Youth Centre (LYC). The LYC looks to support children and youths between the ages of 6 and 25 in Tripoli, against a backdrop of war and political instability.

Tullow Oil was the well-deserved winner of the Local Content Initiative of the Year for their continuous effort toward economic and social development in the countries in which they operate. Oando Energy Resources from Nigeria scooped the final award of the evening, Exploration and Production Company of the Year, for their successful acquisition of ConocoPhillip’s acreage and operations in Nigeria, along with their contribution to the development of local communities. The Africa Oil & Gas Awards 2015 will take place in Sandton, Johannesburg, during September. ■

Corporate Africa 2015

Commodities

SABMiller and Coca-Cola Drinks Merger With more than 30 bottling plants and over 14,000 employees, Coca-Cola Beverages Africa will be the largest Coca-Cola bottler on the continent with the scale, complementary capabilities, and resources to capture and accelerate top-line growth. BY SABMiller’s Media Business Relations Manager, Richard Farnsworth.

he Coca-Cola Company, SABMiller, and Gutsche Family Investments, agreed to combine the bottling operations of their nonalcoholic, ready-to-drink beverage businesses in Southern and East Africa in November, 2014. The new bottler, Coca-Cola Beverages Africa, will serve 12 high-growth countries accounting for approximately 40 per cent of all Coca-Cola beverage volumes in Africa. Africa offers significant growth potential in beverages, underpinned by rising personal disposable income, a fastgrowing population, and increasing per capita consumption. With more than 30 bottling plants and over 14,000 employees, Coca-Cola Beverages Africa will be the largest Coca-Cola bottler on the continent with the scale, complementary capabilities, and resources to capture and accelerate top-line growth.

The new bottler will continue the shareholders’ strong commitment to the economic and social development of the communities it serves.

This will also allow the new African bottler to develop best operating practices and invest in production, sales and distribution, and marketing to benefit from growing demand and drive profitability. 54

Corporate Africa 2015

With a shared vision, extensive experience of operating in African markets, and long-term commitment to the continent, Coca-Cola Beverages Africa will be strongly positioned to offer consumers greater choice, broader availability, and better value. The new bottler will continue the shareholders’ strong commitment to the economic and social development of the communities it serves, which includes providing access to clean water, supporting women’s economic empowerment, and promoting well-being. On full completion of the proposed merger, shareholdings in Coca-Cola Beverages Africa will be SABMiller 57 per cent, Gutsche Family Investments 31.7 per cent, and The Coca-Cola Company 11.3 per cent. “A combined Coca-Cola bottling operation is further evidence of our commitment to Africa and our firm belief in the tremendous growth prospects that the continent offers,” said Muhtar Kent, Chairman and CEO of The Coca-Cola Company, “As one of the top ten largest Coca-Cola bottling partners worldwide, Coca-Cola Beverages Africa can leverage the scale, resources, capability, and efficiency needed to accelerate CocaCola growth and contribute to the economic and social prosperity of African communities.” “Soft drinks are an important element of our growth strategy. This transaction increases our exposure to the total beverage market in Africa.

The opportunity is significant, with favorable demographics and economic development pointing to excellent growth prospects,” said Alan Clark, SABMiller Chief Executive. “This also signifies a strengthening of our strategic relationship with The Coca-Cola Company.”

“A combined Coca-Cola bottling operation is further evidence of our commitment to Africa and our firm belief in the tremendous growth prospects that the continent offers.”

Phil Gutsche, Chairman of Gutsche Family Investments (GFI), said, “Our family sees this merger as an important and logical step to enable Coca-Cola Beverages Africa to optimize the opportunities for development in the rapidly evolving Africa beverage market. We are very excited about the opportunity and are totally committed to ensuring that Coca-Cola Sabco’s distinctive culture is successfully integrated with that of our new partners in order to create an even more successful business in the future.” Details In a transaction to be completed in two phases, Coca-Cola Beverages Africa will bring together: • SABMiller’s South African soft drinks bottling businesses, Amalgamated Beverage Industries (ABI) and Appletiser, and its soft drink bottling businesses in eight other African countries.

Commodities

“I have every confidence that Huseyin M. Akin will add significant value in ensuring this new African bottler achieves its tremendous growth potential.”

•

GFI’s bottling interests in Coca-Cola Sabco, including its South African bottler, Coca-Cola Fortune, and its bottling operations in six other African countries. The Coca-Cola Company’s South African soft drinks businesses in the form of Coca-Cola Canners, Valpre, and Coca-Cola Sanduka Beverages.

Coca-Cola Beverages Africa will initially produce and distribute Coca-Cola beverages in nine countries: South Africa, Kenya, Ethiopia, Mozambique, Tanzania, Uganda, Namibia, Comoros, and Mayotte. SABMiller intends to include, at a later date, its Swaziland soft drinks business and those of its listed subsidiaries in Botswana and Zambia, subject to agreement in due course with those subsidiaries and the requisite regulatory and shareholder approvals. Phil Gutsche will be Chairman of Coca-Cola Beverages Africa, and Port Elizabeth (South Africa) is the intended location for the company’s headquarters.

Leadership In December 2014, Huseyin M. Akin was named Chief Executive Officer designate of Coca-Cola Beverages Africa. He currently serves as Deputy CEO of the Beverage Group (comprising beer and soft drinks operations) of Anadolu Efes and is the Chairman of Coca-Cola Icecek’s (CCI) subsidiary boards. From March 2015, he will lead the strategic and integration planning for the new bottler. He will take up his role as CEO after its establishment, subject to requisite regulatory approvals. “We are very pleased that Coca-Cola Beverages will benefit from Huseyin’s strength of leadership, experience, and expertise, gained from over 25 years in the Coca-Cola system,” said Mr. Gutsche, “I have every confidence that Huseyin will add significant value in ensuring this new

African bottler achieves its tremendous growth potential.” Huseyin M. Akin said: “This is a very exciting opportunity to lead the world’s newest Coca-Cola bottler. As the continent’s largest bottler, Coca-Cola Beverages Africa has a generations-long growth opportunity ahead of it. The next few years will be critical as we merge and integrate the new business, in readiness to deliver its full potential.” Prior to his current role, Akin held the position of President, International Operations for CCI, as well as General Manager for CCI Turkey. He is an Electrical Engineering and Computer Science graduate of Princeton University and also holds an MBA in Marketing and Finance from the Graduate School of Business, University of Chicago. ■

As part of the transaction, The Coca-Cola Company will also acquire SABMiller’s Appletiser brands on a worldwide basis, and acquire or be licensed rights to a further 19 non-alcoholic, ready-to-drink brands in Africa and Latin America, for an approximate cash consideration of US$ 260 million. SABMiller will retain ownership of its non-alcoholic malt beverages in Africa and Latin America and will retain its Coca-Cola franchises in El Salvador and Honduras.

Corporate Africa 2015

Investment

Ghana’s Investor-Friendly

Environment Minister of Trade and Industry, Dr. Ekwow Spio-Garbrah, on the benefits of investing in Ghana.

Minister Ekwow Spio-Garbrah discusses trade and investment at the UK - Ghana Trade and Investment Forum

hana’s priority is the manufacturing sector: to add value to natural resources in a land endowed with gold, cocoa, bauxite, iron ore, manganese, forest products, and agriculture including rice and fisheries, fruits and vegetables, and spices. There is a huge range of agri-processing potential. This relates to services as well, because manufacturing is dependent upon management consultants, financial services, lawyers, accountants, and other professionals. International firms

Companies are either coming to Ghana, have already been there, or are in the process of establishing companies and are looking for partners. They’re in different stages of the investment cycle. are welcome to become involved in any sphere of activity and become a part of Ghana’s market, to help us bring added value to natural resources before they are shipped out. During 2013, Ghana experienced a drop in investments because of the judicial

Corporate Africa 2015

issue surrounding the presidency. Investors were uncertain and remained coy about investing, delaying until the situation became clearer. However, in 2014 investments rose again, showing a clear way forward in terms of how the government’s budget deficits are managed vis-à-vis additional influxes from bilateral and multilateral institutions like the World Bank and USAID, which provide various kinds of support. Once these multilateral and private equity sources can be seen to be moving forward, there is likely to be a significant jump in the next year. Companies are either coming to Ghana, have already been there, or are in the process of establishing companies and are looking for partners. They’re in different stages of the investment cycle. Many of the 500 companies that were at the UKGhana Forum in 2014 had business ideas amounting to billions of dollars. Investors know that the rule of law exists in Ghana and benefits from excellent governance. The judicial procedure surrounding the government in 2013 only took eight months to reach court. It sends a clear message to investors about the kind of nation Ghana is: patient and understanding, using law

to resolve conflicts and not strikes and bullets. They can expect the same just judicial procedure pertaining to their investments.

There is also a fast-tracking process pertaining to investments and transactions unlike in the past when decisions took a long time to become elements in our processing.

These are some of the reasons why Ghana is attractive to investors. There is also a fast-tracking process pertaining to investments and transactions, unlike in the past when decisions took a long time to become elements in our processing. We don’t want a lot of documents lying around. Our staff work like a football team. When the team plays, everyone can see the ball; the 50,000 people in the stadium and the millions of people watching across the world. The ball is moving and the players who hold on to it too long may lose it and eventually the game also. So the ball has to be passed very fast. And this is very important because it makes Ghana an effective place to invest in. ■

8-11 SEPT 2015 ABERDEEN, UK

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Investment

Africa’s new frontier for investment Abdirashid Duale, Chief Executive of Dahabshiil Group, is a prime example of the rewarding opportunities for investment in Somaliland. Here, he reflects on the challenges and opportunities of doing business in the new nation.

uch has been written about the unsettled past of the Somali region, and the ongoing challenges we face. The image of a troubled region, defined and divided by the painful legacy of civil conflict, is a persistent one and it is true that we have struggled with tremendous obstacles in our recent history. But I believe that a different story is emerging: one driven by the enduring energy and enterprise of the Somali people, and poised to offer a much brighter future. There has been a succession of international conferences on the region’s future in the last five years, highlighting the commitment by international bodies and partner governments to progressing the key pillars of political, economic, and security reforms. Most recently, I was proud to attend the inaugural UK-Somaliland Trade &

Corporate Africa 2015

Investment Forum in London, organized with the cooperation of the UK government and President of Somaliland to highlight the significant opportunities available for business and investment. Two British ministers, James Duddridge MP and Lynne Featherstone MP, attended the event and spoke positively about the opportunities, as did Ambassador Neil Wigan.

I believe that a different story is emerging: one driven by the enduring energy and enterprise of the Somali people, and poised to offer a much brighter future.

It was refreshing to attend a Somalirelated conference that focused on investment instead of politics and emergency humanitarian aid; it suggested

that Somaliland has turned a corner – something I am sure all Africans are proud of. As well as its traditional agriculture and livestock industries, Somaliland is harnessing its third decade of postconflict stability to overhaul a range of economic sectors – expanding the port of Berbera to turn it into a key shipping and regional and international transport hub, exploring the untapped potential of the oil, coal, and gas reserves and the fish stocks, and strengthening the financial sector by involving companies like Dahabshiil. There is plenty of opportunity for Public–Private Partnerships, which are fair for all involved and always conscious of protecting the environment. From the founding of my family’s business, Dahabshiil, in 1970, and over the course of a more than 40-year history of

Investment

Founded in 1970, Dahabshiil has become one of Africaâ&#x20AC;&#x2122;s leading Money Transfer Organizations successful and sustained growth, I have experienced first-hand the changes that have now brought Somaliland to the brink of economic transformation. When civil war broke out in 1988, my family was forced to abandon its fledgling merchant business and flee to Ethiopia. We settled in Dire Dawa and began to rebuild our business from scratch. The first years were difficult â&#x20AC;&#x201C; we were in unfamiliar surroundings, our country was in turmoil, and we had lost our business networks and customer base. To survive, we had to innovate. We developed a system trading goods, importing the products into Somalia, and turning the proceeds into local currency. Initially, we delivered cash by hand, relying on word-of-mouth and VHF

radios, and face to face communications. The majority of our customers were refugees, so we also delivered messages between family members in all Somali regions, either as letters or tape cassettes. By serving those who had been displaced by conflict, in a global diaspora that spreads from Melbourne to Minnesota, we have built a global business based on something that is rooted deep in Somali culture: reaching out to family members and helping one another. We are very proud that many other African communities depend on our services, both on the continent and in the diaspora. These include Ethiopia, Kenya, Uganda, Rwanda, South Sudan, Sudan, and others. Dahabshiil today is one of the leading African Money Transfer Organizations

(MTO) and the most established MTO in the Somali region. We have branches in 126 countries worldwide with more than 5000 employees. With 286 locations across the Somali region, we are able to reach even the most remote, rural locations, delivering financial services to communities that are largely outside mainstream banking.

There is plenty of opportunity for Publicâ&#x20AC;&#x201C; Private Partnerships, which are fair for all involved and always conscious of protecting the environment.

Some 95 per cent of the international organizations in the region, including the United Nations, World Bank, and Oxfam, Corporate Africa 2015

Investment Remittances, sent from the diaspora overseas through businesses like Dahabshiil, continue to play a vital role supporting the domestic economy as well as private sector development.

rely on Dahabshiil to provide payment services for their staff contractors, government institutions, partner NGOS. and organizations There is no doubt that there remain significant challenges to doing business in this part of the world, chief amongswhich is the significant infrastructural deficit left by decades of civil war. We can look to the financial sector for an example of this: prior to 1991, all banks and telecoms in the region were stateowned, but these institutions collapsed during the course of the conflict. Several years of comparative stability in Somaliland have enabled this sector to partially recover. Remittances, sent from the diaspora overseas through businesses like Dahabshiil, continue to play a vital role supporting the domestic economy as well as driving private sector development. Surveys undertaken in 2012 by the UN’s

Corporate Africa 2015

Customers at Dahabshiil’s branch in Hargeisa Food Security and Nutrition Analysis Unit (FSNAU) estimate that 44 per cent of households in Somaliland and Puntland receive remittances; this means that almost 50 per cent of domestic spending on consumer products is made possible by these funds. On a microeconomic level, some 80 per cent of small and medium-sized enterprises received start-up capital in the form of remittances, or have a diaspora investment partner; remittances also underpin the widespread “hagbag” saving groups, which are particularly important in enabling women to save for larger expenditures and investment, including entrepreneurial activities. By increasing levels of local economic activity and domestic revenue, remittances have

helped sustain government functions as they work on the key sectoral and infrastructural reforms that are vital to inclusive growth. Our belief that the private sector can and should play a vital role in bringing greater stability and prosperity to the region is at the core of our business. Dahabshiil is the largest private sector employer in the region, and we will continue to innovate and evolve as a responsible local partner, bringing long-term social and economic development from the ground up. We continue to encourage cooperation, partnerships, and good competition, all of which are essential to the development of a healthy economy. Key to Somaliland’s success have been

Investment

security and the incredible dynamism of Somali entrepreneurs. It is essential that this spirit is allowed to continue, as the

Dahabshiil today is one of the leading African Money Transfer Organizations (MTO) and the most established MTO in the Somali region.

private sector has been the driving force of the territory’s progress since it was destroyed by civil war. The continued creation of jobs and opportunities will safeguard Somaliland from the instability and conflict that affect its neighbors. We operate across all Somali territories, including southern Somalia. The international community, including governments and financial institutions, can be a crucial part of this by supporting the Somaliland private sector and encouraging international banks, including British-based institutions, to be involved. The money transfer industry, and the many development agencies and NGOs who work with us to drive regional development, needs governments and regulators to align in order to overcome the global de-banking movement which is financially excluding not just developing countries, but millions of British and American Somali citizens and others around the world. Banking services are a crucial component of the efforts to drive regional development and would make for a more joined-up foreign policy for stability, recovery, and growth. Although our core business remains in remittance services, we

have interests in real estate and construction – vital components in rebuilding the country’s infrastructure. The vast majority of the region’s road networks are unpaved roads, so we have invested heavily in a plan to install road signs and mile posts along one of the main highways in the Somali territories. Infrastructural deficiencies remain a major barrier to development, so every year we make large donations to largely infrastructure-led community regeneration projects, with an emphasis on building roads, schools, and providing funding for healthcare. We also help during humanitarian crises. In recent years, we have expanded into the fast-growing and much-needed areas of banking and telecoms, with the launch

With continued interest by the international community and the British government under David Cameron’s leadership, who has publicly highlighted the importance of Somali issues on a number of occasions, Somaliland should continue to progress toward greater stability. The momentum achieved by the recent conferences must not be lost. The Somaliland investment conference is an important part of this, especially as the territory is at a critical stage in its growth and can play a pivotal role in the continuing rise of the African continent; the changes we have witnessed over recent years have been incredible, made possible by the

Key to Somaliland’s success have been security and the incredible dynamism of Somali entrepreneurs. It is essential that this spirit is allowed to continue.

of Dahabshiil Bank International and our telecoms company, Somtel, in 2010. We introduced the first debit card in the Somali region and we are in the process of rolling out an ATM project in Djibouti, Hargeysa, and Mogadishu. Mobile payments are becoming an increasing feature in the African market, as epitomized by the runaway success of M-Pesa in Kenya. While we already have certain mobile functions integrated into our remittance process, such as payments and balance updates via SMS, our recently introduced E-Dahan platform will add banking and money transfer to our mobile services, and bring greater competition to the marketplace.

Abdirashid Duale enterprise and drive that is part of the Somali DNA. The Somali investment conference in Sweden should also help push development forward. I urge the international business community to dig deep and provide the final push the people of this region need. The investment opportunity is huge, and I encourage overseas partners to come take a look themselves and join the development story. We, Dahabshiil, will warmly welcome them. ■

Corporate Africa 2015

Education

Africa’s learning curve The latest Times Higher Education Univeristy World Rankings shows African universities lagging behind the rest of the developing world. Deputy Vice-Chancellor of the University of Cape Town, Professor Danie Visser, and Phil Baty, editor of The Times Higher Education University World Rankings, discuss the possible reasons.

hen the 2013–2014 Times Higher Education (THE) University World Rankings were published, it quickly became apparent that South Africa’s University of Cape Town (UCT) was, once again, the only African university to be ranked in the world’s top 200. Stellenbosch University, the University of Witwatersrand (WITS), the University of KwaZulu-Natal, and Egypt’s Alexandria University have entered the top 400 at various points since 2011 but have been unable to replicate UCT’s achievements. On a continent with booming economies and a need for well-educated professionals and experts to drive the growth in industries, a high standard of tertiary education is a key element to success. So why are African universities failing to make their mark? There is also a question as to whether these universities can compete in a global context, given THE’s formula which measures elements such as the number of publications each university produces in world-leading research journals which tend to be published in North America or the English language. While THE’s

Corporate Africa 2015

University World Rankings are globally respected and carry a great deal of weight, there are alternative measuring systems. Shanghai Jiao Tong University recently compiled a ranking of the top 500 universities in the world which challenges the THE’s results in that they show a particular improvement in the performance of Chinese universities.

China’s creation of the C9 League (an alliance of nine universities akin to the UK’s Russell Group or America’s Ivy League) demonstrates the significance that China has placed on education.

While it also ranks the African universities lower (with UCT at 260 instead of 126), it includes more South African institutions as well as Egypt’s Cairo University. Similarly, the recently released THE’s BRICS & Emerging Economies Rankings painted a very different picture to the University World Rankings as South Africa boasted five universities with UCT

in fourth place overall. While it may have slipped one spot from its position last year, the universities of Witwatersrand, Stellenbosch and Pretoria have all climbed higher in the rankings. Morocco’s University of Marrakech Cadi Ayyad also made an appearance in 50th position. Phil Baty (THE’s University World Rankings editor) commented on how the BRICS rankings differ from the University World Rankings. “We tried to stick to the same tried and tested formula to recognize that a lot of these universities in the BRICS top 100 are aspirating to World Class status. We adjusted the weighting slightly giving less weighting to research productivity and influence and we give a bit more weighting to other factors like income industries to reflect the developmental priorities of these countries. It is a slight recalibration of the formula rather than a different set of metrics.” Speaking of Africa in particular, Mr. Baty noted that THE does not engage in much data collection around African nations, which are not very visible in research publication databases. He also suggested that the methodology would have to

Education

Photographs courtesy of the University of Cape Town

be reconsidered to get an accurate idea of the continent’s educational institutions. The current formula has been created to judge current World Class, research-intensive universities. “Where it is appropriate to judge Cape Town against those standards, it isn’t appropriate to judge more nationally focused, younger universities against the same criteria that you’d judge Harvard.” However, compared to institutions in other emerging economies, the African universities are clearly lagging behind other regions, particularly Asia where China in particular has cemented its dominance among the emerging economies. Its creation of the C9 League (an alliance of nine universities akin to the UK’s Russell Group or America’s Ivy League) demonstrates the significance that China has placed on education. Professor Danie Visser is UCT’s De pu t y Vice - Ch ance llor w hose por tfolio responsibilities include

advancing postgraduate studies and internationalization. While he has stated that THE’s University World Rankings are not a determining factor within the world of African academia, he recognized the publication’s importance in a global context, particularly when it comes to attracting students. Professor Visser attributed the difficulties that African universities face in climbing up the rankings to a number of factors such as the prioritization of government investments and social responsibility obligations.

“I think it has everything to do with investments by governments. That is the key.”

“I think it has everything to do with investments by governments. That is the key. African universities have a very high standard but this disinvestment that happened or the neglect of our universities from the 60s onwards have meant that they couldn’t keep up. The best people in universities go to other places in the world where they can do research. “In South Africa, the Department of Higher Education and Training’s basic principle is

Professor Danie Visser

Corporate Africa 2015

Education On the subject of UCT’s success, Professor Visser attributes it to the university’s culture of research.

that South African universities should all be able to deliver basic university education at a level of quality. They are spending much money on raising the standard of all universities to make them all appropriately resourced. The National Development Plan does recognize that each university has to have its mission and that is appropriate to what it is doing. Hopefully that will also translate into a more nuanced funding structure to be competitive.” His statements were supported by Mr. Baty’s assertion that there is a role for differential treatment when it comes to funding institutions of higher academics where a strategy could involve “picking out a smaller number of universities to be promoted as global competitors and allow other African universities to focus on immediate national goals around education and basic graduate skills.” Professor Visser also discussed the importance of social responsibility in

“We have many financially needy students. We spend more of our money on financial aid than we get from the government.”

Corporate Africa 2015

African universities where a higher number of students may be financially disadvantaged compared to those in developed economies. “The research is really relevant to our communities and, because we have to direct it, often it is not the things that might be published in the journals that have the most effect. It also affects the amount of money we have to spend. We have many financially needy students. If you are academically accepted at UCT, you don’t have to leave because of financial issues. “If you are struggling, we will make a plan. Through scholarships, grants, or loans, you

can finish your degree. We spend more of our money on financial aid than we get from the government for that purpose. A lot of the money that could go to research, is spent on that, but it is a very important part of our mission.” On the subject of UCT’s success, Professor Visser attributes it to the university’s culture of research. “It has a lot to do with having been in the game for a long time and taking research very seriously. We have invested in all the ways we should: equipment, maintenance, and support for emerging researchers

Education

“It does seem like Nigeria and Kenya should be rising forces if the governments prioritizes and recognizes the importance of strong universities as part of economic growth and development goals.”

Mr. Phil Baty who we mentor and support. We are able to show people that, if you come here, your standard of living will be the same as anywhere in the developed world. We have found that we get very good international applications for our posts.” He also described a cross-border project with Carnegie to create the next generation of African academics, which is part of UCT’s larger project to revive the African academy. South Africa’s UCT and WITS have joined the University of Ghana and Makerere University in Uganda in this endeavor, which will produce 100 Ph D’s or postdoctorates and give those who want to be in

academia extra training in teacher research management. Ultimately, these academic institutions play a large role in the success of a nation. While Africa has been fortunate in its resources, research and experts educated in the country can help to sustain and develop economic growth. Professor Visser uses the example of Africa’s extractive industry as an area where having academic experts and research could help the continent achieve more success. “As a continent, we have to understand the value of what is under the ground. There hasn’t been research done in the African

countries. Foreign companies arrive and say, ‘This is how much you have of bauxite, those are the total reserves and we’ll give you so much.’ But there may be ten times as much. You can only know if you do your own research.” “Based on my sense of conversations with some African university leaders and other factors at play, it does seem like Nigeria and Kenya should be rising forces if the governments prioritize and recognizes the importance of strong universities as part of economic growth and development goals,” Mr. Baty concluded. ■

African Universities have a social responsibility towards financially disadvantaged students Corporate Africa 2015

EVENTS kenya

AUSTRALIA 3rd Africa Australia Infrastructure Conference 2015

5th – 6th March 2015 Melbourne Convention & Exhibition Centre Melbourne africaaustraliaconference.com

ETHIOPIA Ethiopia Summit

4th – 5th February 2015 Sheraton Addis Addis Ababa Tel : +27 12 754 1350 www.ethiopiasummit. economist/com

france World Gas Conference 1st – 5th June 2015 Paris Tel : +33 (0)1 80 21 08 03 www.wgc2015.org

4th East Africa Oil & Gas Expo 2015

Upstream West Africa

23rd – 25th March 2015 Accra www.upstreamwestafrica.com

19th February 2015 London Tel: +44 (0) 20 7779 7277 s-scg.com/events/ukaatic15

south africa 4th Annual Concentrated Solar Thermal Power Conference & Exhibition

6th Ghana Oil & Gas Summit

21st – 23rd April 2015 Accra International Conference Centre Accra www.cwcghana.com

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21st – 24th April 2015 Cape Town International Convention Centre Cape Town Tel : +1 (604) 681 2153

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