14/10/2020

Uganda to benefit from the new UK Export Finance

As part of the UK government’s ambition to boost trade globally, UK Export Finance (UKEF) can now provide increased financial support that will benefit UK exporters seeking to win business in over 100 countries worldwide.

Countries that can benefit from UKEF’s increased capacity to provide export finance include Egypt, Paraguay, Serbia, Uganda and Vietnam – allowing the UK government’s export agency to support a diverse range of international projects that will increase UK trade and create opportunities for British business.

This includes enabling UKEF to support more renewable projects overseas and providing opportunities for UK suppliers to be at the heart of the green industrial revolution, following the allocation of £2 billion of direct lending to finance green projects in the latest budget.

UKEF provides support to UK exports through guarantees, loans and insurance and is strategically positioned to provide competitive financing to overseas companies looking to do business with the UK. UKEF will continue to work with UK businesses to maximise the supply of UK goods and services into international projects, creating new trading opportunities for UK suppliers.

In 2019 to 2020, UKEF provided £4.4 billion of support for UK exports, which included over £300 million in financing for wind farms in Taiwan, £110 million for a new maternity hospital in Ghana and £40 million to rehabilitate 83 kilometres of road in Gabon. As a result of its increased risk appetite, UKEF can now support a greater number of projects in a wide range of overseas markets.

Exports Minister Graham Stuart said:

As well as negotiating new free trade agreements and removing trade barriers, we are able to offer export finance support that can unlock the potential of the UK sup-ply chain. UKEF helps overseas buyers access the financial support they need to procure from the UK. This helps UK companies win more business on the world stage.

UKEF’s huge increase in capacity can be a real game-changer for the prospects of UK exporters, and will be vital to thousands of suppliers across the country.

Recently, UKEF provided £70 million of support for Contracta Construction UK to build the Kumasi market in Ghana, which directly benefited UK business and local economies. To access UKEF’s support, Contracta sourced goods and services from the UK supply chain, including from family-run manufacturer BHC Ltd based in Scotland. BHC won a £20 million export contract to provide 8000 tonnes of steelwork and 100,000m2 of metal decking for the Kumasi Market after being introduced to Contracta at a UKEF-run supplier fair event, which has generated growth and opportunities for the business.

UKEF connected more than 500 UK suppliers with international projects through its supplier fair programme in 2019 to 2020, and will continue to do so following the recent expansion of its capacity to provide export finance and support to more countries.

Brian Hewitt, Managing Director, BHC Ltd said:

UKEF helped us secure a huge international contract. Not only has this helped our business, but it has also bolstered the local economy during these difficult times.

We look forward to winning more overseas business off the back of this deal.”

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11/10/2020

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24/02/2020

Mr. Fabian Kasi MD Centenary Bank, transforming the bank into a Ushs1trillion institution

Taddewo Senyonyi

Much has been said about the failure by Ugandans to rise to the helm of serious organisations. In fact many reasons have been advanced to explain this occurrence ranging from the reasonable to the ultimate unreasonable. But as the debate rages on regarding why Ugandan business leaders are not rising to the occasion, there are some Ugandan leaders that have stood out as symbols of our capability to grab the opportunity and ride with it.

Fabian Kasi, the Managing Director of Centenary Bank, is one of those leaders. Intelligent, simple and professional are some of the best words to describe the 46 year old Kasi. Unlike many CEOs, getting an appointment with Kasi especially when you have (a) genuine reason isn’t a tall order but you must be prepared to arrive for the meeting on time, because he is strict with his time. “Every one of us has 24 hours each day”.

“How well you manage your time determines how much you can complete in a single day and ultimately how successful you will be in whatever you are trying to put your hands on,” he says. Dressed in a dark blue suit, the soft spoken Kasi wears a simple genuine smile as he welcomes me into his office at Mapeera House, the headquarters of Centenary Bank.

His office is spacious but not opulently decorated. A fine finish of brown wood, whose mahogany brown colour is sufficiently illuminated by ceiling lights, gives his office an aura of authority and class.

The not too wide crystal blue windows at the back of his desk give you a vantage view of the hustle and bustle on Kampala Road and the Constitutional square something that Kasi says gives him a chance to quickly appreciate the wide variety of customers that Centenary Bank was built to serve.

His early life

Born in Matugga, Wakiso district, 46 years ago, Kasi, attended Matugga Primary School, St. Mary’s College Kisubi for O and A levels, before proceeding to Makerere University, where he graduated with a Bachelor of Commerce (first class degree), majoring in accounting in 1991.

He also holds a Masters of Business Administration from the University of Newcastle, Australia and is a fellow of the Association of Chartered Certified Accountants (FCCA) of United Kingdom and a full member of the Association of Certified Public Accountants of Uganda. He has also trained in several banking and accounting courses both within Uganda and abroad. At 46 years only, Kasi wields vast working experience in banking and accounting spanning over 20 years.

Since 1990, he has worked for several organisations including Centenary bank where he is currently managing director, FINCA Uganda, Commercial Bank of Rwanda, British American Tobacco (Uganda), Bank of Uganda, Makerere University, the University of Newcastle, PriceWaterhouseCoopers and Shell Uganda Ltd. At 46 years of age, Kasi is definitely one of the youngest CEOs in the country’s mainstream corporate entities and is probably the only under 50 CEOs to head a trillion shilling company.

Kasi’s meteoric rise to senior leadership positions didn’t come on a silver platter. He says, the time, resources and energies he invested to develop his character and career is the key to the magic. “The ability to inspire confidence in the team, hard work and being result oriented and being able to show results have been key in my life. Where I have worked, I have left a good track record of performance,” he says, adding: “the ability to demonstrate good skills learning all the time and improving your skills is very important in shaping any career.”

Track Record

For example, having joined Centenary bank in August 2010 from FINCA Uganda, where he was country Director from 2002 to 2010, Kasi took the bank to another level, it is now the 4th and 5th in terms of profitability and asset base respectively as of December 2012. During his leadership at Centenary Bank, customer deposits have grown from Ushs500bn in 2010 to Ushs820bn by end of 2012.

Net profits have grown from Ushs22bn per year to Ushs56bn in the same period while branch network has grown from 37 branches to 57 branches. Credit extended to public has grown from Ushs320bn to Ushs575bn by end of 2012, while client numbers have grown from 900,000 to 1,300,000. At FINCA where he was the Country Manager before joining Centenary Bank, he grew its loan book from Ushs 4.5bn to Ushs21bn, with portfolio at risk of only 2%.

Loan client numbers grew from 35,000 to 46,000 while savers stood at 80,000. He however is quick to chip in that his successes have been largely associated with the teams he works with. “As a manager, identifying good talent in the team and sufficiently motivating and developing them to deliver is a challenge that every leader must take on,” he says, adding: “Empowering people, giving them the confidence to make decisions is critical.”

A day in the life of Kasi

He wakes up at 5:30am and by 6:30am he is out of home, to drop his children to school and by 7:00am, he is already in office. While in office, the first thing he does is to review work of the day, then reads newspapers and prepares for meetings. “In the afternoon, I visit clients and some branches and sometimes I am in meetings,” he says. He calls it (the day) quits at 6:30pm. And since work without play makes Jack a dull boy, Kasi goes to the gym at Kampala Club and Serena hotel.

While there, he also chats and interacts with friends. “You may over lean on work, forgetting that there’s life beyond work but I manage to balance the two for my acquaintances are important both personally and professionally.” He says he spends quality time with his family over the weekends and remembers to go with family to church especially on Sundays.

He likes playing soccer, reading magazines and watching drama. Apart from being the managing director of Centenary bank, Kasi is not only obsessed with banking but also farming; he is into commercial tree farming.

Advice to aspiring leaders & budding entrepreneurs

“They should make a roadmap; work hard, continuously learn new skills and improve them. In other words, they should build character and confidence,” he advises, adding: “In banking, integrity is very key.”

He advises the youth to work hard and motivate employers but they must also look at jobs creation.“Getting rich very quickly is not a good thing you need to invest in time, resources, energies in developing your character and competencies,” he counsels. To Kasi, entrepreneurs should be resilient if they are to succeed.

“They should set the vision what they want to achieve and work at it. This means investing in time, knowledge and resources aiming at creating trust within themselves and the communities in which they work,” he said, adding: “Our (Centenary bank) philosophy is not to make a lot of money but be useful to the community and the public this has won us trust and the clients have become loyal to us, they see us as their bank.”

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01/02/2020

H.E. Mrs. Janet Kataaha Museveni, 1st Lady presntation at the 2012 Convention

FIRST LADY SPEECH

The First Lady of Uganda and Minister for Karamoja Affairs started her speech by expressing great pleasure to be at the 2nd Uganda Convention in UK.

She conveyed greetings from the President and all the people of Uganda and said it was gratifying to know that Ugandans in London are still interested to know about what is happening in Uganda, and especially in a corner like Karamoja, which most people don’t normally really care about.

Hon. Museveni informed the delegates that she came to the convention in response to an invitation by the chairman Mr. Willy Mutenza, to share her experience, successes and challenges in her work in Karamoja.

The Minister reminded delegates that she was given this assignment in 2009, when the region at that time, had just been through a drought for three years. She said the region was dry, there was shortage of food but surprisingly the cattle were not as thin as she had expected. There was shortage of water for both people and cattle. The situation was bleak and people had no hope for anything to change. She reminded delegates of the expression that was so common that “the rest of Uganda cannot wait for Karamoja to develop”

Her first task, Mrs.Museven said, was to conduct a monitoring tour of all the 41 sub-counties of Karamoja to understand the development and challenges faced by these people. Through dialogue with the grassroots population and communities interaction, she was exposed to the pains and suffering of the ordinary families in Karamoja. “I touched the depth of the tragedy of many years of isolation of these communities and the despair of these people was truly emotionally draining”, she said.

“In my hands, I held children debilitated by acute malnutrition while talking to mothers whose only hope was the next supply of irregular food ration of humanitarian agencies.

I knew then that we had the responsibility to get our people out of abject poverty and to lead them to prosperity where we are as a country in Uganda now.”

Mrs Museveni shared that some few years before she was appointed, the president has pitched camp in Karamoja for three month and had launched the disarmament programme which was on-going. Unfortunately, she said, the poverty levels were the engine that drove conflict and insecurity in the region. Therefore, there was a need to get God’s own wisdom and inspiration that would breathe life back to this devastated region of Uganda.

1st lady comment on the UK Convention

She wondered how many delegates remembered the biblical story in the book of Ezekiel Chapter 37, which talks about the valley of bones.The First Lady said,” If you know it, you will understand that, if God could raise the valley of the dry bones into a standing army of Israel, then Karamoja was nothing to God, for God can do all things”. Therefore” she said, “our work in Karamoja started with a lot of prayer and believing in God to lead our plans”.

They set to work with the cooperation of the UPDF, who reinforced the disarmament exercise by including the Karamojong elders who, in turn, helped by mobilising the youth for peace. The police galvanised the numbers to ensure that law and order was in place and Local Defence Units (LDUs) were trained by police to ensure that communication at the grassroots was easy, as LDUs were Karamojong themselves. As security forces continued to stabilise villages and communities, they started new initiatives on food production.

She elaborated that the Ministry of Karamoja, under the Office of the Prime Minister (OPM) launched a comprehensive food security plan for Karamoja which was to consolidate the approach towards a transformed production system, although there was need for some emergency measures. They therefore came up with a short term solution to get the population back in the mode of growing food for themselves instead of relying on food aid.

Having recognised that the women who form the bulk of farmers in Karamoja, as they do in the rest of Africa, were too weak and too discouraged to plough and plant enough to get them out of the vicious cycle of famine and food relief, they initiated a tractor hire scheme, whereby a commercial firm was brought in to plough, harrow and plant an agreed acreage for identified vulnerable households and women groups to ensure that they would get adequate quantities of food. Her ministry, and NAADS, Ministry Of Agriculture and other donor agencies supplied seeds and other planting materials.

They started by opening up some 2300 acres for vulnerable households at that time. In the last season, they opened up 20,000 acres and planted food in all the districts of Karamoja. This is over and above what some farmers manage to do for themselves.

“Presently”, she said, “some able farmers make independent arrangements with commercial farms to hire tractors to open up land. Others are already asking government to help them acquire tractors, while others are beginning to discuss ways they can come together, as farmer associations can bring in big harvests, manage their produce better and obtain better prices on the market for their produce.

She assured delegates that the mind-set of the people in Karamoja is already changing with an illustration that when they started this mission, 70% of the people in Karamoja were living on food aid but today the food insecure families are only 10%.

Turning to the situation of water supply, the Minister reported that the government of Uganda put in place a framework to guide this recovery and development in the whole of northern region and Karamoja, called PRDP. Under this program, they set to provide water both for human and animal consumption. By the end of this year, they hope to have at least 15 parish valley dams and hope to provide at least one valley dam per parish for animals in all 177 parishes in Karamoja. The rest of the valley dams will be constructed under NUSAF2 program, starting at the end of this year.

The Minister informed delegates that the Ministry of Water which is responsible for providing water reservoirs in the country, has constructed one reservoir per district in Karamoja. She was hopeful that when all these water points are completed, there will be sufficient water for animals and for irrigation assisted agriculture.

Mrs.Museveni said that in addition, they have boreholes for domestic use and are working with UNICEF to ensure repair or drilling where necessary so that they can ensure clean water for communities wherever they may be. They also want to fit solar pumps on each borehole so that communities can be empowered to grow vegetables around the water source using drip irrigation, thus improving the nutrition status of households in Karamoja.

On community empowerment, the Minister reported that they have designed the program specifically to try to bridge the gap left by cattle rustling, which at times left families too vulnerable to know how to survive. In efforts to motivate such families, they provide livestock such as cattle or goats to some women and youth groups and they include some oxen so that they can enable people to revive the use of ox ploughs for agriculture.

In order to curb cattle theft, the minister said they started an electronic branding of all cattle in Karamoja. The practice involves inserting an electronic chip in the stomach of the cow, containing information such as name of owner, its locality, colour of the cow etc. If the animal is stolen then traced, an electronic monitor can easily read the information and the cow relocated to its rightful owner. She said this form of cattle branding has helped a lot to minimise cattle rustling in Karamoja. The people have regained the confidence that they can actually keep their animals once branded. So far, 80,000 heads of cattle have been branded and the exercise is still on-going. “I am glad to report that the people of Karamoja have embraced and appreciated this intervention. Neighbouring districts have requested for this service to be extended to their livestock as well”, the minister concluded.

On the education sector, Mrs.Museveni noted that Karamoja has lagged behind because of various challenges which include infrastructure, school buildings and staff houses, lifestyles and attitudes of communities, leading to low enrolment and high dropout rates. She lamented that despite the progress the country has made in education, Karamoja is only still at 12% literacy rate, which is very low. In response to this, the minister reported, the government of Uganda, assisted by partners in development like Irish Aid, have constructed new staff houses and classrooms. She said they will continue on this road to consolidate these achievements through the Northern Uganda Social Action Fund in the next three years. “As part of the affirmative action for Karamoja under UPE and USE, Karamoja children access free education and 100 scholarships for tertiary education are set aside for Karamoja children every year. Government also plans to build model boarding primary and secondary schools throughout the region, complete with teachers’ houses so that children are taught and fed and kept in school full time instead of dropping out.”

Reporting on the health sector, the Minister informed delegates that provision of health services has remained a big challenge in Karamoja. The region continues to report high levels of maternal and infant mortality rates. She identified the following as critical factors responsible for the crisis: inadequate accommodation for health workers and inability to attract and retain qualified staff, thus making service delivery particularly difficult. In order to address these challenges, she said government has taken the following steps: allocating resources through PRDP and NUSAF 2; two district hospitals in Abim and Moroto have been elevated to referral medical facilities for that region;

collaborating with private hospitals like Matany missionary hospital to train midwives and nurses who will be absorbed into government health facilities; through MOH and UNICEF, immunisation, nutritional therapy, sanitation and sensitisation of communities on maternal and child care.

She concluded that in an effort to bring primary healthcare services closer to the people, UNICEF has helped them to establish village health teams in communities across the region of Karamoja. Village health teams are small health clinics at village level.

The Minister informed delegates that the roads in Karamoja region, like any other infrastructure, suffered many years of lack of maintenance and because of insecurity, the road network was not used. Therefore, there was no maintenance for a long time and in the rainy season, floods would wash away bridges. To alleviate the situation, the Government has decided to upgrade some of the roads in Karamoja to make them permanent. Some funds have been secured to commence work on the Moroto-Nakapiripirit road. The Ministry Of Works, through the National Roads Authority (NRA), has also advised Public Private Partnership (PPP) for the working on several roads. PPP is a strategy they use in Karamoja to try to change the road network. The Minister concluded that she had no doubt that this improvement in infrastructure will boost development and will open the region to further investment opportunities.

Addressing the housing sector, the First Lady reported that the Karamojong have for a long time lived in grass thatched houses, in community settlements known as manyatas.

“Knowing the role of good housing in promoting better quality of life and taking the aspirations of local people to experience social recovery and transformation, we have piloted the construction of permanent housing settlements in Nadunget, in Acerere village, Kamuswahili, in Moroto town and Olengedwat, in Nakapiripirit district” she highlighted.

She elaborated that each organised homestead has twenty homes fully connected with solar lighting. Around those homes are situated schools, water sources and an agricultural production area. This arrangement, it is hoped, will act as an incentive for future development of permanent homes in the area.

Mrs. Museveni outlined government interventions in the area of Rural Electrification. She said Government has completed construction of electricity lines in the areas of Muyembe, Namalu, Amudat, Soroti, Katakwi and Moroto, and was exploring solar power initiatives with private sector. She encouraged Ugandans at the convention to explore participating in this programme of rural electrification.

“As we look to the future, we shall continue to work towards the region producing its own food, engaging in other development activities and with improved infrastructure. Therefore, we shall attract investors to help the region harness its natural resources and potential so that prosperity can become a reality in this region” the minister stated.

She concluded that they hope to achieve all these aims within the framework of Karamoja Integrated Development Program. The program enables all stakeholders to contribute and stay together as equal partners for the progress of Karamoja, a region of opportunity for private entrepreneurs and investors from within and outside Uganda.

The First Lady proceeded to list what Karamoja has to offer: Karamoja is home to one of the most beautiful and highly endowed game parks in Uganda, the Kidepo National Game Park. The stunning and unique scenery in the region and undisturbed habitat offer tremendous opportunity for eco-tourism. The vast territory with its rich volcanic soils is a great advantage for mechanised commercial crop and livestock agriculture to feed the market within Uganda, as well as the regional and global demands. The region is rich with various minerals, many of them ready for exploration. Avenues for green energy production, including solar and fuel thermal renewable energy, are unparalleled. There are opportunities for large forests plantations to offer carbon credit to partners from industrialised countries, as well as for contributing towards mitigation and adaptation of global warming and climate change.

“This meeting, focussing on sustainable prosperity, should embrace these opportunities and encourage all Ugandans, friends and partners in development and entrepreneurs, to pursue these opportunities in Karamoja. In so doing, we shall have a win-win situation, where profits are shared, and the people of Karamoja can taste prosperity like the rest of the world”, emphasised Mrs. Museveni.

Citing that Europe could not be complete without Germany, whose role is very significant in the contemporary Europe, she said that Uganda’s development cannot be complete without the development of Karamoja.

Concluding her presentation, the First Lady and Minister for Karamoja Affairs called upon all present to join them on this journey to bring our brothers to the same level with the rest of Uganda, in dignity and prosperity. “The development of Karamoja”, she reiterated, “is a collective responsibility. It is a frontier we have to cross even as we celebrate the golden jubilee of our independence. Fortunately investments opportunities are wide open for us to exploit for the good of the Karamojong and Uganda at large”.

She pledged the commitment of the government of Uganda to support any endeavour towards enhancing the prosperity of Karamoja.

Hon. Museveni once again, thanked the organisers for giving her the opportunity to share her experience with the convention delegates.

“I thank you for listening to me and God Bless you”

For more information about investment in Karamoja contact

Nekesa Barbara Oundo, mp

Minister Of State For Karamoja Affairs.
Email: bnekesa@parliament.go.ug

http://www.parliament.go.ug

2nd Convention, Dr. Robert Limlim, First Lady of the Republic of Uganda and Minister for Karamoja Affairs The First Lady, Transcript of the H.E. Mrs. Janet Kataaha Museveni, Uganda Prime Minister Office No Comments

31/01/2020

Investors Prepare the Ground for Data Center Growth in East Africa

[quote]

Interxion’s move into the region suggests its meagre digital infrastructure may at last be seeing a start of meaningful investment.

By Mark Ballard

[/quote]

European data center giant Interxion’s move into East Africa suggests the region’s meagre internet infrastructure may at last be starting on a path toward catching up with the developed world.

Investment in data centers and connectivity infrastructure south of the region has picked up dramatically in recent years, but the growth has been concentrated mostly in South Africa. Google is building a private submarine cable from Lisbon to Cape Town; Berkshire Partners just bought a majority stake in Teraco, reportedly South Africa’s largest data center provider; Microsoft Azure launched its first cloud data centers on the continent last year, in Johannesburg and Cape Town; and Amazon Web Services is gearing up to do the same this year by launching cloud data centers in Cape Town.

The situation in East Africa is starkly different. It is one of the most poorly connected regions on the planet, according to a DCK analysis of World Bank data. With its deformed telecoms market, obstructive legal and trade systems, underdeveloped power infrastructure, a small digital workforce, and little money, eager investors are counting on governments to take the steps necessary to make data center and network building possible.

Last week’s UK-Africa Investment Summit in London demonstrated that momentum is gathering. African leaders joined UK Prime Minister Boris Johnson in a declaration of commitment to develop infrastructure, on the premise that it is necessary for economic growth. Politicians and academics have invested great hope in the idea that a digital economy will lift African people out of poverty, and that internet connectivity will help people overcome crises like the one that in recent days hit drought-hardened farmers in East Africa, where a swarm of locusts threatened to become a plague, making people fearful of famine, displacement, and the conflict those things could bring.

Momentum in Kenya

The biggest obstacle to those trying to build digital infrastructure in the region has been a lack of investment, Ranjith Cherickel, chief executive of Icolo, Kenya’s largest data center operator, said as Interxion prepared to announce its takeover of his firm in December. Icolo, by Cherickel’s account, pulled itself up by its own bootstraps, with injections of cash, equipment, and skills from Interxion, which has been making them since the Kenyan operator was founded in 2015. (Interxion itself is in the process of being acquired by the US data center giant Digital Realty Trust.)

In that time Kenya went from being one of the least connected places in the world to one of the most connected (at least) in Africa and within reaching distance of the average middle-income country. Yet the gap between where Kenya has reached and the most connected countries is still far greater than the one that has widened between it and the least connected countries in the world, most of which are in central Africa.

The prime minister’s vision of a “Global Britain” after Brexit will only succeed if he abandons imperial nostalgia in favor of practical investment in the continent’s fast-growing economies.[quote][/quote]

By Stephen Paduano

LONDON—It was the maiden voyage of “Global Britain,” as Prime Minister Boris Johnson played host to African leaders and representatives in London on Jan. 20. Soon to be free to set its own trade agenda, with Brexit taking effect on Jan. 31, the United Kingdom hopes to project the image of a nation untethered from the rules and regulations of the European Union. Africa—with its rapidly growing populations and economies, rising middle class, and recent ratification of a continentwide free trade agreement—was as good a place as any to start.

With a rate of return on investment that outstrips much of Asia, all of Latin America, and the average of the world’s developed economies, there is little doubting the money to be made in Africa, too. However, a splashy summit and tall talk will not do the trick. Reaching Britain’s goals will require a scale of investment and a humbling of its traditional role as a great power, of which the government gives no guarantee.

Although the prime minister tried not to wade into the waters of nostalgic imperialism at the summit, as he has so often done in the past, Johnson remained committed to the idea that the U.K. can overcome Africa’s “suitors” to become the “obvious partner of choice.” It was a tired recapitulation of an old trope—competition on the continent, a “scramble for Africa”—which reflects neither Africa’s politics nor Britain’s prospects in the 21st century.

For all the ambitions of the Global Britain agenda, however, the summit was a rather muted event. There was no show of force to rival the Russia-Africa Summit last year, when Russian President Vladimir Putin showed off his jets and tanks at his seaside resort in Sochi.

Neither was there any of the grandeur of the most recent Forum on China-Africa Cooperation in 2018, when Xi Jinping feted 51 African leaders in Beijing’s Great Hall of the People as he promised world-historical transformation—“The ocean is vast because it rejects no rivers,” Xi prophesied of the opportunities China and Africa shared. Nor did it seem to show the same significance of the United States’ last summit in 2014, when 37 African heads of state gathered in Washington as then-President Barack Obama advanced a range of health, security, and investment initiatives while knocking Chinese intentions on the continent.But it was still a productive day for the 13 African leaders who made the frosty trek to a blocky InterContinental Hotel on the Greenwich Peninsula, an industrial stretch of land in southeast London. Indeed, it was likely all the more productive for focusing on trade and investment, rather than the conflict and contestation that have consumed so many summits as of late. “The world needs to be seeing Africa less as a problem and more as an opportunity,” said Gyude Moore, Liberia’s former public works minister and a fellow at the Center for Global Development.

The crowd in London seemed to agree. “Let us seize the opportunities that are before us here today,” Johnson told the representatives of the governments and corporations in attendance. His goals, though pacific, were still ambitious. Within two years, Britain aims to become the largest G-7 investor in Africa—a feat that will require a 75 percent increase in capital invested to top the United States and a more than 90 percent increase to top France. To be sure, this goal is largely, if not entirely, implausible.

The prime minister cannot command the private sector to deploy the necessary $16 billion to Africa in order to achieve his ambitions there, and it is highly unlikely that the Department for International Development (which the prime minister is considering closing) would cough up 112 percent of its annual aid budget either. That French President Emmanuel Macron is equally eager to reshape French-African relations and will be hosting a summit of his own this summer makes Britain’s goal even less achievable.

Nevertheless, the U.K.-Africa sessions succeeded in broadening the traditional horizons of political summitry from its focus on conflict and development to sustainable finance, infrastructure, and clean energy. This was a sure step in the right direction, but there is still much work to be done.

Within two years, Britain aims to become the largest G-7 investor in Africa—a feat that will require a 75 percent increase in capital invested to top the United States and a more than 90 percent increase to top France. To be sure, this goal is largely, if not entirely, implausible.

The first task, said Emma Wade-Smith, the British trade commissioner for Africa, is diversification. Given the concentration of British capital in a few select—and underperforming—countries and industries, this much is long overdue.

At present, 30 percent of the U.K.’s foreign direct investment in Africa, $15 billion in 2018, is located in South Africa. The problem is not the sum; it’s the proportion. “What we want to do is increase the flow of investments so we can see the numbers that we have in South Africa replicated elsewhere around the continent,” Wade-Smith told Foreign Policy.

It makes sense that British investments would be so prominent in South Africa, a prized former colony where old interests and networks have endured and which continues to rank as the largest and one of the most developed countries in Africa. But given that the continent contains 27 of the world’s 50 fastest-growing economies, and that South Africa—with its 0.8 percent growth rate, intractable political problems, and ongoing battle against corruption—is not among them, opportunities to diversify would seem to abound.

Some of these lie within the U.K.’s traditional field of investment, such as Kenya, which has an economy less than one-third the size of South Africa’s and development scores that trail as well. Nevertheless, Kenya has become a cornerstone of the East African economy, a gateway to the Indian Ocean that represents 33 percent of East Africa’s rapidly growing market and boasts a growth rate of 6 percent. It is hard for any African state to top Kenya’s economic profile, but still the country receives a paltry 2 percent of the U.K.’s investment in the continent.

[pullquote_left]It is hard for any African state to top Kenya’s economic profile, but still the country receives a paltry 2 percent of the U.K.’s investment in the continent.[/pullquote_left]

This shouldn’t be the case, said Nicolle Richards, the head of investor relations at Lendable Marketplace, a financial services firm in Nairobi. “There’s a lot of opportunity here,” Richards argued, “and not just for development organizations.”

This much has grown increasingly clear in the case of Kenya’s technology sector, what some have taken to calling the “Silicon Savannah.” Last year, Nairobi’s burgeoning start-up scene attracted $149 million in funding, leading the field of the African tech market, which brought in a total of $492 million.

Contributing to the industry’s success were profitable, scalable start-ups such as Lori Systems, an “Uber for trucking,” as Richards described it, which is cutting the sky-high cost of logistics in Kenya by providing trucks and truck drivers to suppliers at the click of a button—and wooing a number of Chinese, American, and Nigerian investors in the process. There is also M-Kopa, an impressive pay-as-you-go solar energy company that has been able to deliver affordable electricity to hundreds of thousands of Kenyans through a savvy mobile payment system.

Kenya’s highly advanced financial technology (fintech) sector, where simple mobile payments are used for personal transactions, utility bills, and much more, makes this app and many others like it possible, not to mention profitable. ITIKI, a drought-forecasting start-up that aims to improve crop yields and prepare farmers for the scourge of climate change, has become operational in Kenya, Mozambique, and South Africa as well.

“People are very optimistic about what’s going on because start-ups here are solving real problems that no other businesses are trying to solve,” Richards said. But for all the opportunities on offer—in logistics and energy, fintech, health tech, and more—access to capital remains a key concern. The cash shortage is only partially sensible. To wary investors’ credit, there have been few initial public offerings or acquisitions for Kenyan start-ups, meaning that there is no reliable route for earning returns. However, the pace of innovation and the expanse of the market speak for themselves. More than anything else, exposure to the Silicon Savannah and Africa’s tech scene appears to be the limiting factor.

As a result, Nairobi is a logical destination for British investors, and a new government initiative hopes to bridge the capital gap. “Go Global Africa,” launched last year, invites Kenyan, Nigerian, and South African start-ups to compete for a five-day training and networking session in the U.K. Its participants have already included leading lights such as Muthoni Masinde, the founder of ITIKI. However, without any new investment pledges, and with only the annual competition on Go Global’s agenda, it is clear that the U.K. will have to redouble its efforts if it expects to make any real progress.

It is clear that the U.K. will have to redouble its efforts if it expects to make any real progress.

The situation is much the same on the other side of the continent, in Ghana, where a different British initiative seeks to assist a local agricultural renaissance. Since taking office in 2017, President Nana Akufo-Addo has made a push for greater agricultural productivity, sending thousands of government officials across the country on motorbikes to work with the country’s farmers. Given that agricultural yields in sub-Saharan Africa are just 20 to 30 percent of what they could be—due to the fact that just 4 to 6 percent of agricultural land is irrigated and best practices on which fertilizers and seeds to use are not always implemented—the upside potential is exceptional.

A new initiative of the British High Commission in Ghana, the Agricultural Transformation Programme, which was announced at the summit, hopes to advance this productivity project and benefit from its rewards. Boasting a decently diversified, high-tech, multibillion-dollar industry of its own, Britain should be well placed to promote Ghana’s agricultural agenda.

Boris Johnson’s New Scramble for Africa

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30/01/2020

Why Brexit is a turning point for Europe-Africa relations

The UK’s exit from the EU could be an opportunity for African countries. Britain is repositioning itself, and the power dynamics in Brussels are changing. Can African governments leverage the changes to their advantage?

Symbolbild - Brexit und EU (Getty Images/AFP/T. Akmen)

There’s a new player on the world stage. Alright, let’s rephrase that. An old player is trying to redefine itself – the United Kingdom. On January 31, Britain officially leaves the European Union. And the UK has no qualms showing that it’s focusing on its future outside the bloc.

British Prime Minister Boris Johnson skipped this year’s World Economic Forum in Davos to focus on Brexit. During that week, he hosted more than a dozen African heads of state at the UK-Africa Investment Summit in London. Deals worth nearly $8 billion (€7.3 billion) were announced. The message was, Britain is ready to do business with Africa.

“Britain has to find new partners that they can work with in the long run to build their economy,” says Mark-Anthony Johnson, the CEO of JIC Holdings.

“Africa of course, with its huge potential, will make the ideal partner,” adds the investor, who was also involved in organizing the summit.

The UK wants to be the continent’s “investment partner of choice,” but it has quite a bit of catching up to do.

Infografik Afrikas größte Handelspartner EN

The City of London is one bright spot. With 112 African companies with a market capitalization of around $166 billion listed on the London Stock Exchange, it is the most important center for Africa’s businesses outside the continent. And the British capital wants to increase its links with African stock exchanges going forward.

Vying for a bigger seat at the table

The UK is one of the world’s largest economies, and the EU’s second biggest, after Germany, according to data from Statista. Its exit from the bloc creates a new partner for Africa. However, as the main recipients of EU official development assistance, African countries could potentially feel the impact of Brexit on the EU budget, if there’s less money as a result. Whatever the case, the UK’s departure has implications for the power dynamics in Brussels.

“The other big players, Germany and France, will be making a push and have been pushing to have their voices within the EU more heard on African issues,” says Uzoamaka Madu, a consultant specializing in EU-Africa relations.

Graphic shows leading EU donor countries: Germany, United Kingdom, France, Sweden, Netherlands

She points to French President Emmanuel Macron as an example. He’s reshaping relations with African countries. In December, he said the CFA franc, would be scrapped — France is is loosening influence on the currency of many of its former colonies. Macron also called colonialism a “grave mistake.”

France knows it has “an opportunity or a threat at the EU table” because it could increase or lose their influence on African issues, says Annie Mutamba, a Brussels-based expert on EU-Africa relations. She believes Germany, Italy and Scandinavian countries are also keen to fill the gap left by the UK.

During a speech in Davos, German Chancellor Angela Merkel called for a summit with African countries at which an agenda could be discussed. And earlier in the month, her country’s development minister, Gerd Müller, said Berlin wanted to work on a new EU pact with Africa when Germany assumed presidency of the Council of the European Union in the second half of 2020.

“It’s going to be interesting to see if we have a French flavor or not,” Mutamba says.

EU, Africa to rewrite partnership rules

French flavor or German gestalt, Brussels will be resetting its relationship with Africa after Brexit. The EU and the Africa, Caribbean and Pacific Group of States (ACP) are negotiating a new partnership deal. The Cotonou Agreement, which provides a framework of rules between the bloc and the ACP’s 79 member states, expires in February.

While the future EU-ACP agreement is pending, the discussion in Brussels is whether African countries will work through the ACP or the African Union (AU), says Annie Mutamba. The AU is increasingly becoming a global player, especially with the creation of the African Continental Free Trade Area (AfCFTA), which the EU has also been supporting.

Germany is calling for a new EU pact with Africa

“[The EU is] clearly funding activities to promote continental integration because what they want is to have a continent-to-continent partnership,” says Mutamba.

And this can be achieved with Africa’s free trade area.

“Coming together under the AfCFTA is going to push African leaders to come to a common position on a lot of really important economic issues,” Madu explains.

Trading is slated to take effect on July 1 in countries where it has been ratified. But some experts expect it to take years for the world’s largest free trade area to become fully operational.

More African presence needed

For now, it’s still every government for itself, especially for trade and development issues. Unfortunately, many African countries continue to face some challenges that prevent them from being able to have a major influence on the EU’s Africa strategy.

“One of the main stumbling blocks is access to decision-makers here in Europe, not only in Brussels, but elsewhere, in other capitals,” Mutamba explains.

She believes the African governments need to be more present in Berlin, Paris and other capitals in countries that play a bigger role in shaping the EU’s Africa strategy. In Brussels, they have to compete to get their voices heard.

“It’s actually the NGOs that are driving African interests […] within the context of EU policy,” says Uzoamaka Madu.

“Those are the voices that you hear more loudly and are at the forefront of budgetary discussions,” she adds.

In London, it’s “a mixed bag,” and it mainly depends on the topic, according to Johnson.

“The NGOs are very influential in terms of the information,” he says. “They spend a lot of money collecting data.”

Members of the British royal family, who were at the UK-Africa Investment Summit, could help revive the Commonwealth

Of course, not every African government is underrepresented. Johnson also points to Ghana and Rwanda as two countries that are helping set the agenda when it comes to working with their European partners.

Another playing field?

Rwanda is set to become the first Commonwealth country that isn’t a former British colony to host the group’s heads of state summit in Kigali in June.

“The UK is trying to revive the Commonwealth now post-Brexit and with the idea of a Global Britain,” says EU-Africa affairs consultant Uzuamaka Madu, noting that its relevance has diminished.

It will be interesting to see how and if the UK uses the Commonwealth to improve its relations. While several deals were announced at the inaugural UK-Africa Investment Summit, critics were not convinced.

“There’s still not yet enough meat to really call it something that’s a strategy […] focused on delivering something focused,” says Madu.

But the fact that the UK is acting alone could work to its advantage. Whereas the EU’s Africa strategy may include compromises between its member states, that won’t be the case for the UK. The current government’s majority also clearly gives it the parliamentary votes to set the tone. And despite some of the negative post-Brexit forecasts for the British economy, investor Mark-Anthony Johnson is optimistic about the prospects for African countries.

“UK companies will continue irrespective [of the economy] because they are looking to expand and they are looking for new markets, irrespective of what happens to the economy,” he says.

Original article: https://www.dw.com/en/why-brexit-is-a-turning-point-for-europe-africa-relations/a-52177939

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30/01/2020

Brexit Drives British Africa Investments

Brexit is a loss for Europe but it could turn into a win for Africa.

Author: Charles Wachira

Two African bonds listed at the London Stock Exchange (LSE) during an inaugural UK-Africa Invest summit held in London on January 20 as Britain begins the Brexit process. Attended by 21 invited African states and lasting three days, the summit also saw the British bourse sign a memorandum of understanding with the Ghana Stock Exchange (GSE).

Hosted by British Prime Minister Boris Johnson, the summit brought together businesses, governments and international institutions to showcase and promote the breadth and quality of investment opportunities across Africa. It was the latest in a series of “Africa-Plus-One” summits, encapsulating the idea of several African countries engaging a non-African state, preferably an industrialized one.

The first summit of this kind was held in France in 1972, followed by Japan in 1993, and the US in 2014 during Barrack Obama’s presidency. Most recently Russia had an African Summit last October.

However, none of these get-togethers has matched the scale and interest of the China-Africa summits, which kicked off 20 years ago. At the last one in 2018, twice as many African presidents attended the Beijing summit as attended the 73rd session of the UN General Assembly (UNGA 73) held same year.

The attention Africa is now receiving from the British government has almost everything to do with Brexit, with the UK on the verge of leaving the European Union (EU) on terms yet to be agreed. Britain needs to open up trade relations with other nations once it withdraws from trade agreements negotiated by the EU after the 18-month transition from being a member of the EU begins on January 31.

“We want to build a new future as a global free trading nation, that’s what we are doing now and that’s what we will be embarking on, on 31st of January,” PM Johnson told the gathering in London. “But I want to intensify and expand that trade in ways that go far beyond what we sell you or you sell us.”

The UK hopes to reverse its dwindling trade with Africa, which fell from 4.2% of its total trade in 2012 to just 2.0% or $46 billion in 2018. To put that in perspective, China’s 2018 trade with Africa was $204 billion, according to the country’s Ministry of Commerce. Most of that trade was with a small handful of countries; South Africa, Nigeria and Algeria account for more than half of all UK-Africa trade. “For all the talk of impact investment, the amount of capital [committed to Africa] is falling,” says Nick O’Donohoe, chief executive of CDC Group, the UK’s development finance agency. “People are pulling back; banks are pulling back. That’s partly because the cost of capital post the financial crisis has gone up. The cost of compliance has caused doing business to be more expensive.”

With Africa’s new continental free trade area expected to kick off in July 2020, African participants at the summit asked for more robust pan-African deals on goods and services, while urging the UK to do better than the EU’s stringent Economic Partnership Agreements with sub regions in Africa.

Unlike the EU, the UK signaled a willingness to eliminate rigid rules of origin on products to allow Africans to easily export to the UK.

A total of 27 deals worth an estimated $8.5 billion (£6.5 billion) were signed at the UK-Africa Summit. There were pledges for $1.9 billion (£1.5 billion) worth of initiatives for sustainable infrastructure, targeting private sector investments and drawing them to fund road, energy, ICT and other infrastructure projects in Egypt, Ethiopia, Ghana, Kenya and Uganda.

The newly signed MOU will see the LSE support Ghanaian businesses raise equity and debt capital, both domestically and internationally. The MOU also includes supporting cross-listing between the British bourse and GSE, establishing a centralized corporate news dissemination platform in Ghana to promote efficient disclosure practice and price formation; sharing of experiences of UK stock market demutualization and supporting future public market fund raising for Ghana Infrastructure Investment Fund.

Acorn Holdings Ltd, the largest Purpose-Built Student Accommodation (PBSA) property developer in Kenya, dual-listed its $42.6 million green bond program at the LSE after having listed initially at the Nairobi Securities Exchange (NSE) this January 13, becoming the first African issuer to list on London’s Sustainable Bond Market.

“This successful listing of Acorn’s bond, developed using UK aid-backed expertise, means new, affordable, environmentally-friendly housing for 5,000 Kenyans. I look forward to building more partnerships like this at next week’s UK-Africa Investment Summit in London, which will deliver more investment, jobs and growth to create a successful future for all our people,” UK Secretary of State for International Development Alok Sharma said.

Proceeds raised will finance environmentally friendly accommodation for 5,000 university students in Nairobi, the country’s capital.

The International Bank for Reconstruction and Development (IBRD) also issued its first Rwandan Franc (RWF) bond on the LSE’s main market, making it the first bond IBRD has issued in London.

“We are delighted to welcome the first Rwandan Franc bond to list on our markets, a strong signal of confidence in Rwanda’s economy. London Stock Exchange is uniquely placed to offer funding channels for local currency bonds, and we continue to support the development of African capital markets,” said Nikhil Rathi, CEO, London Stock Exchange Plc and Director of International Development, LSEG.

The RWF-denominated bonds offer investors an annual coupon of 9.25% and are payable in US dollars. The bonds settle on January 24, 2020 and mature on January 20, 2023.

There are more than 100 African bonds currently listed on LSE, raising a combined $105 billion. Additionally, London welcomed IPOs from African firms Airtel Africa and Helios Towers in 2019. Helios Towers is the second company featured in LSEG’s ‘Companies to Inspire Africa’ report to list in London, following Vivo Energy’s IPO in 2018.

Original article: https://www.gfmag.com/topics/blogs/brexit-drives-africa-investments

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30/01/2020

How does a landlocked country have a port?

With its first dry port, Rwanda is looking to create a gateway of trade to Kenya, Tanzania, and beyond, sparking interregional trade across the continent.
Source: CNN

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