Wednesday, July 6, 2011

Africa's Megacities and the Opportunities They Offer


Lagos is West Africa's largest city.By 2030, the 18 largest cities on the African continent will have a combined spending power of US$ 1.3 trillion. How can the needs of a growing urban community create opportunities for investment and growth? Dianna Rienstra compiled the following summary from a discussion on the continent’s megacities at the recent World Economic Forum on Africa, held in Cape Town.

Lagos is West Africa's largest city.
In 2010, 14 African cities had a total population above 3 million. All African cities are growing at an accelerating pace. Energy, water and sanitation challenges exist today and are being exacerbated as increasingly people move to cities in search of a better life. New technologies are needed to meet these challenges.

New, “enabling” infrastructure is needed, which will require public-private partnerships. There is a huge incentive for renewable energy and “smart water” powered by technology. Jobs will be created as smart cities are developed.

Cities – and megacities – can be incubators for innovation. Resource efficiency in these urban centers and their satellites could become a competitiveness factor as they attract domestic and foreign investment.
The Middle East focused too much on building housing for middle- and high-income people. Today, most cities in the region face critical housing shortages for low-income residents. African city planners should not make the same mistake. In Egypt, for example, there is a shortage of 1 million units. There is room for public-private collaboration to address this need. Building affordable housing is a growing market, which will create jobs.

Myriad opportunities exist for the financial services in Africa’s growing cities. Consider that in Lagos and Accra, for example, an estimated 25% of residents have access to bank accounts. Economic clusters in cities and their satellites are driven by SMEs, but most entrepreneurs, particularly women, have no access to finance to grow their businesses. By offering competitive products, financial services – particularly commercial banks – can be a driver of growth in Africa’s cities.

Cities are becoming increasingly congested and in Africa, cholera outbreaks are commonplace. To relieve this pressure, it is important to fund rural development and satellite cities. Local government involvement is key to ensure that planning meets the needs of citizens.

Megacities offer mega-opportunities, but there are no mega-solutions. Customised solutions, new technologies and new ways of thinking are needed to retrofit today’s cities and to build the sustainable urban centers and satellites of tomorrow. Future cities cannot be built on old models that do not work.

Historic African Telecom Satellite Lauched

Image: Ariane 5 launch
S. Martin  /  ESA / CNES / Arianespace
Europe's Ariane 5 rocket lifts off from its launch pad in French Guiana carrying the Yahsat Y1A and Intelsat New Dawn satellites into orbit on Friday.

Africa's first private-sector communications satellite that will provide broadband and wireless services has been launched from South America bearing South African statesman Nelson Mandela's signature, according to a statement from Arianespace on Saturday.
The Ariane 5 took off late Friday from French Guiana carrying the Intelsat New Dawn, which was built through a joint venture with Intelsat and Convergence Partners consortium. The satellite also was imprinted with a Zulu phrase that means: "Go Well, New Dawn."
It joins 21 other Intelsat satellites serving Africa.
Also launched was the Yahsat Y1A, the first satellite operated by the United Arab Emirates' Al Yah Satellite Communications Co. It will provide customized relay services for governments and businesses in Africa, Europe, the Middle East and Southwest Asia.
The Ariane 5 was carrying a record 10,050 kilograms (22,156 pounds).
The satellites were supposed to be placed in orbit in late March, but Arianespace, the commercial arm of the 13-country European Space Agency, postponed the launch after reporting problems with the rocket's main engine.

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Low Cost Airline Set to Boost Tourism Travel Within Africa


by Denis Mugerwa
Fly540, a Kenya based airline which became the 3rd operator on the Entebbe-Nairobi route in February is positioning it self to take on the continent’s established airlines as the race to capture African skies by regional airlines moves into advanced stages.

Fly540 is a semblance of the low cost carriers as it kicked off with low cost flights on the Entebbe-Nairobi route as compared to Kenya Airways and Air Uganda. With a major motive of becoming Africa’s first budget airline, Fly540 is promising to extend its services to other African regions, a statement from the marketing department read.

A statement also stated that Uganda is the first target, after establishing a nationwide existence in Kenya though soon, it will spread to Tanzania with Mwanza as the first destination of operation thereby offering low cost carrier to tourists and business people traveling between Kenya and Tanzania. According to the statement, “Mwanza first because there is a lot of business travel there. The traffic is very heavy and because people are flying quite frequently, and for them to do so, they also need to save.”

By October, the Tanzania route is expected to be open while there is a plan to extend services to Dar-es-salaam, Zanzibar, Moshi, and Kilimanjaro accordingly before further extending to Angola.
After Angola which will act as hub for Southern Africa, the next target is Rwanda and there after, proceed to West Africa of which, Ghana will act as the hub for the West African Region. After all this is achieved, it will then be a pan African low cost airline, becoming the first airline with hubs in 3 quadrants in Africa that offers services which people require that is; low costs for travel that will be convenient to their budgets.

The airline which has flown about 7,000 passengers on the Entebbe-Nairobi route since it started establishes that it is growing on a monthly basis with a steady increase in sales which is no doubt a step towards achieving their ambitious dream.

This step is set to improve travel with in the East African region there by enabling the branding of East Africa as a single tourist destination with the chance of visiting Uganda, Kenya and Tanzania tourism attraction at the same time. As the plan for the rest of Africa sets in, Africa would become a better place to visit since travel costs will be reduced a factor that has been impeding tourist visits to the continent.

Denis Mugerwa - About the Author:
I am a tour Consultant at Adventure Trails Limited a tour company operating in the East African Region, here to help any one interested in travel with in the region

Monday, July 4, 2011

The Mothership


Africa is moving at the speed of light! The continent is in the dawn of its second renaissance. Forget what mainstream Western media is showing you, its not the whole picture.

Africa is China's #1 trading partner and we all know what's going on in China. India is currently vying for Africa to take its top trading spot as well. While the Western world has been mired in recession for the past few years, Africa has endured no such trouble, in fact, since 2000 the middle class all over Africa has increased significantly due the jobs China and India have flooded onto the continent. This burgeoning middle class is what is spurring investment in retail outlets, real-estate and infrastructure development.

"Long a symbol of stagnation, the African continent is experiencing a reawakening. Poverty and hunger are still widespread problems, but Africa's growing middle class is creating business and investment opportunities that are among the best in the world. With the right trade policy and development assistance, we can unlock the potential of a thriving private sector and lift millions from poverty.

Six of the 10 fastest-growing economies of the last decade were in sub-Saharan Africa, the Economist recently found. And over the next five years, the average African economy will outpace its Asian counterpart. From telecom to financial services, extractive ..."
- WallStreetJournal.com

There are 1.2 billion people in Africa and half of the population is under 30.  The giant influx of technology coupled with increased political stability and more educational opportunities is a recipe for enormous economic and social progress. Out of the top ten countries building and innovating the fastest are South Africa, Nigeria, Kenya and Ghana where significant inroads have been made in telecommunications, education and real estate development.

For those of us who've never been to Africa or don't have any relatives or friends to connect with as a means of making contact, there is a wealth of information online that can aid in one's quest to find a way of making business connections somewhere on the continent. The fastest way to actually get to Africa is by simply vacationing there. Africa is a tropical paradise! There are literally thousands of tourist destinations and five star resorts to consider from.

Granted, there is much work still to be done, but that is where the gold mine is, in the WORK that has to be done! The current movement opens up opportunities for more innovation, development and the cultivation of ideas that those of us who love Africa have so long waited for the chance to bring to fruition. African people all over the world must begin to think seriously about how it is they are going to do business with and within the continent. We can't allow outside influences to usurp the unsurpassed opportunity currently flourishing in Africa. We must strike now while the renaissance is in its dawn and not one second later. Do you have your ticket for the Mothership?

Friday, July 1, 2011

Hiding the Real Africa!

Hiding the Real Africa Indeed

I've been screaming this since 1996, when I lived in Ghana for seven months doing a semester exchange at UG, Legon. I came home trying to tell people Africans generally are not poverty stricken in the way we think. Granted, there are terrible things occurring throughout the continent in the case of war and famine in Africa, as there would be anywhere in the world. Where governments are relatively stable, however, just because SOME people don't have a lot of material possessions, doesn't mean they are poverty stricken (I emphasized some, because there are a lot of wealthy and "middle class" Africans that we would never know existed if we didn't travel to the continent). The so-called poor eat every day, they work every day, they send their children to school, they travel throughout the region, they participate in MANY ceremonies and celebrations. Yes they are earn much less in terms of money than we would on a typical job in the US, but they do earn money. All those women we see carrying huge loads on their heads are working. What's more, they're part of an enormous market system, an economic network that is the backbone of everyday African life. I could go on and on, but I will say, what they lack in terms of material possessions, they make up ten fold in culture. In the US, we don't even know what culture means.
ITS PAST DUE TIME. FORWARD AFRICA.

Reports — March / April 2011
Hiding the Real Africa: Why NGOs prefer bad news By Karen Rothmyer
And now for some good news out of Africa. Poverty rates throughout the continent have been falling steadily and much faster than previously thought, according to the National Bureau of Economic Research. The death rate of children under five years of age is dropping, with “clear evidence of accelerating rates of decline,” according to The Lancet. Perhaps most encouragingly, Africa is “among the world’s most rapidly growing economic regions,” according to the McKinsey Quarterly.
Yet US journalism continues to portray a continent of unending horrors. Last June, for example, Time magazine published graphic pictures of a naked woman from Sierra Leone dying in childbirth. Not long after, CNN did a story about two young Kenyan boys whose family is so poor they are forced to work delivering goats to a slaughterhouse for less than a penny per goat. Reinforcing the sense of economic misery, between May and September 2010 the ten most-read US newspapers and magazines carried 245 articles mentioning poverty in Africa, but only five mentioning gross domestic product growth.
Reporters’ attraction to certain kinds of Africa stories has a lot to do with the frames of reference they arrive with. Nineteenth century New York Herald correspondent Henry M. Stanley wrote that he was prepared to find Zanzibar “populated by ignorant blacks, with great thick lips, whose general appearance might be compared to Du Chaillu’s gorillas.” Since the Biafran War, a cause célèbre in the West, helped give rise in the late 1960s to the new field of human rights, Western reporters have closely tracked issues like traditional female circumcision. In the 1980s, a famine in Ethiopia that, in fact, had as much to do with politics as with drought, set a pattern of stories about “starving Africans” that not only hasn’t been abandoned, but continues to grow: according to a 2004 study done by Steven S. Ross, then a Columbia journalism professor, between 1998 and 2002 the number of stories about famine in Africa tripled. In Kenya, where I was a Peace Corps volunteer in the late 1960s and where I returned to live four years ago, The New York Times description of post-election violence in 2007 as a manifestation of “atavistic” tribalism carried echoes of Stanley and other early Western visitors.
But the main reason for the continued dominance of such negative stereotypes, I have come to believe, may well be the influence of Western-based non-governmental organizations (NGOs) and international aid groups like United Nations agencies. These organizations understandably tend to focus not on what has been accomplished but on convincing people how much remains to be done. As a practical matter, they also need to attract funding. Together, these pressures create incentives to present as gloomy a picture of Africa as possible in order to keep attention and money flowing, and to enlist journalists in disseminating that picture.
Africans themselves readily concede that there continues to be terrible conflict and human suffering on the continent. But what’s lacking, say media observers like Sunny Bindra, a Kenyan management consultant, is context and breadth of coverage so that outsiders can see the continent whole—its potential and successes along with its very real challenges. “There are famines; they’re not made up,” Bindra says. “There are arrogant leaders. But most of the journalism that’s done doesn’t challenge anyone’s thinking.”
Over the past thirty years, NGOs have come to play an increasingly important role in aid to Africa. A major reason is that Western donors, worried about government corruption, have channelled more funds through them. In the mid-1970s, less than half a dozen NGOs (like the Red Cross or CARE) might operate in a typical African country, according to Nicolas van de Walle, a professor of government at Cornell, but now the same country will likely have 250.
This explosive NGO growth means increasing competition for funds. And according to the head of a large US-based NGO in Nairobi, “When you’re fundraising you have to prove there is a need. Children starving, mothers dying. If you’re not negative enough, you won’t get funding.” So fierce is the competition that many NGOs don’t want to hear good news. An official of an organization that provides data on Somalia’s food situation says that after reporting a bumper harvest last year, “I was told by several NGOs and UN agencies that the report was too positive.”
Rasna Warah, a Kenyan who worked for UN-Habitat before leaving to pursue a writing career, says that exaggerations of need were not uncommon among aid officials she encountered. “They wanted journalists to say ‘Wow.’ They want them to quote your report,” she says. “That means more money for the next report. It’s really as cynical as that.”
Western journalists, for their part, tend to be far too trusting of aid officials, according to veteran Dutch correspondent Linda Polman. In her book The Crisis Caravan, she cites as one example the willingness of journalists to be guided around NGO-run refugee camps without asking tough questions about possible corruption or the need for such facilities. She writes, “Aid organizations are businesses dressed up like Mother Teresa, but that’s not how reporters see them.”
Pushed and pulled by slashed budgets and increased demands, journalists are growing increasingly reliant on aid groups. Sometimes that involves not just information or a seat on a supply plane, but deep involvement in the entire journalistic process.
In an online essay written in 2009, Kimberly Abbott of the International Crisis Group discussed a 2005 Nightline program on Uganda that her NGO helped to produce and fund. It was hosted by actor Don Cheadle, the star of Hotel Rwanda. Nightline’s Ted Koppel explained in his introduction, as retold by Abbott: “Cheadle wanted his wife and daughters to get a sense of the kind of suffering that is so widespread in Africa. The International Crisis Group wanted publicity for what is happening in Uganda. And we, to put it bluntly, get to bring you a riveting story at a greatly reduced expense.” According to Abbott, “versions of such partnerships are happening now in print and broadcast newsrooms across the country, though many are reluctant to discuss them too openly.”
Daniel Dickinson, a former BBC reporter who is now a communications officer for the European Union in Nairobi, has seen the impact of technology and economics on reporting on Africa first-hand. “The big difference in the past five to ten years is the expansion of the Internet,” he says. “Journalists have got to feed these animals. Add to that the financial crash, and more and more internationals are taking the content we offer them.”
Ben Parker, co-founder and head of IRIN, a news agency that is part of the UN Office for the Coordination of Humanitarian Affairs, admires Dickinson’s success. “He does stories and they’re picked up whole,” Parker says. IRIN itself can point to many similar successes in finding takers for its stories on aid projects. “The Western media won’t reprint us verbatim,” he says. “But some plagiarize.”
Lauren Gelfand, a correspondent for Jane’s Defence Weekly who is based in Nairobi, says most reporters she knows string for three or four news organizations to make ends meet, and can’t afford to do time-consuming stories. She saw the effect when she took a year off from journalism to work for Oxfam. “If reporters were going to cover a development story it had to be easy,” remembers Gelfand, noting that the simplest sell was a celebrity visit to an aid project.
Gelfand says that her Oxfam experience helped her to understand just how much attention ngos put on getting their story told. “All the talking points are carefully worked out…. It’s a huge bureaucracy and there are as many levels of control as in any government,” she says of Oxfam, adding that many NGOs are reluctant to cooperate with media unless they know they’ll be shown in a positive light.
To be fair to the NGOs, Gelfand says, “It’s easier to sell a famine than to effect real, common-sense policy change.” And, she says, she continues to believe that most aid workers do what they do because they want to make a difference. Nonetheless, “A lot of what Oxfam does is to sustain Oxfam.”
Stories featuring aid projects often rely on dubious numbers provided by the organizations. Take Kibera, a poor neighborhood in Nairobi. A Nexis search of major world publications found Kibera described as the “biggest” or “largest” slum in Africa at least thirty-four times in 2004; in the first ten months of 2010 the claim appeared eighty-three times. Many of those stories focused on the work of one of the estimated 6,000 or more local and international NGOs working there, and cited population figures that ranged as high as one million residents. Recently, however, the results of Kenya’s 2009 census were released: according to the official tally, Kibera has just 194,269 residents. In 2010, Rasna Warah wrote in the Daily Nation, a Kenyan paper, that while working for the Worldwatch Institute, an NGO, she had published inflated population estimates using UN-Habitat data, despite knowing there was no consensus on the numbers among her former colleagues at the organization. Sometime after 2004, she wrote, population estimates for Kibera started to rise, and “Before we knew it, the figure spread like a virus.” She added, “The inflated figures were not challenged, perhaps because they were useful to various actors…. They were particularly useful to NGOs, which used them to ‘shock’ charities and other do-gooders into donating more money to their projects in Kibera.” Questionable figures of another sort are to be found in reports on the United Nations Millennium Development Goals, a series of targets on poverty reduction and other measures of well-being. UN and NGO officials routinely describe Africa as failing to meet the goals, and the press routinely writes up this failure.
But some experts, among them Jan Vandemoortele, one of the architects of the MDGS, have expressed concern that the goals are being misused. He wrote in 2009 that the MDGS were intended as global targets, but have been improperly applied to individual countries and regions. “It is a real tragedy when respectable progress in Africa is reported as a failure by international organizations and external observers,” Vandemoortele wrote, voicing the suspicion that particular measurements have been selected “so as to present Africa as a failure, solely to gain support for a particular agenda, strategy, or argument.”
Nonetheless, when the UN met in September, The Associated Press quoted UN Secretary-General Ban Ki-moon as saying, “Many countries are falling short, especially in Africa,” while the Los Angeles Times quoted an Oxfam report as saying, “Unless an urgent rescue package is developed to accelerate fulfillment of all the MDGS, we are likely to witness the greatest collective failure in history.”
The consequences of skewed or incomplete reporting on Africa are not just a disservice to readers but also have the potential to influence policy. “The welfare model [of Africa] is still dominant on the Hill and in Hillary Clinton’s world,” according to van de Walle. Among corporate officials, says Catherine Duggan, an assistant professor at Harvard Business School, the perception is still that “Africa is where you put your money once you’ve made it somewhere else.” Moreover, such reporting is demoralizing to Africans working for change. Martin Dawes, a unicef regional chief of communication for West and Central Africa, says that when there is a disaster, journalists “come to us as aid workers but often don’t talk to the government, which is often what we’re working through. It means that the chances for Africans to show an engaged response is limited. They are written out of their own story.”
Even with shrinking resources, journalists can do better than this. For a start, they can stop depending so heavily, and uncritically, on aid organizations for statistics, subjects, stories, and sources. They can also educate themselves on how to find and interpret data available from independent sources. And they can actively seek out stories that deviate from existing story lines.
But in the end, it will probably take sustained economic progress to break the current mold. Sunny Bindra, the Kenyan management consultant, recalls that in the 1980s, “Japan got attention because it was whacking the US. It’s the same with India and China now.” Until that happens, a sick African woman in labor will continue to be treated as poverty porn, and most Africans will have to starve in order to make it onto the evening news.
This article was adapted from a paper (pdf) written for Harvard’s Joan Shorenstein Center on the Press, Politics and Public Policy.

A New Scramble for African Riches

Posted on Thursday 5 May 2011 - 12:58
By André-Michel Essoungou, courtesy United Nations publication Africa Renewal
When the world's biggest retail company, US-based Walmart, bought a majority stake in South Africa's Massmart - also a retail company - for a staggering $2.5 billion last year, eyebrows were raised. Foreign investors in Africa usually put their money in the riches that lie beneath its soil, not over its discount counters.
Cosatu to face Walmart in SA retail operations
In fact, the steady growth of foreign direct investment (FDI) to the continent during most of the past decade has been mostly concentrated in mining, especially oil.

Yet, much like Walmart, a growing number of investors are betting on the continent’s ultimate wealth — Africans themselves — a report by the UN Conference on Trade and Development (UNCTAD) reveals. And for all the shock that Walmart’s foray into African retailing initially prompted, it still fell well short of the $10.7 billion sale of Kuwaiti telecommunications company Zain’s African assets to Bharti, an Indian competitor, a few months earlier.

Overall, the UNCTAD report notes, amidst a recent slump in FDI flows to Africa caused by the global 2008 financial crisis, “The services sector, led by the telecommunications industry, became the dominant FDI recipient.” Across the continent, new deals involving major foreign corporations are becoming a common occurrence in industries previously considered unattractive. Nestlé, the Swiss food giant, has announced plans to spend $1 billion by 2013 for acquisitions in various African countries, including the Democratic Republic of the Congo, Nigeria and Angola. Less than two years ago, Nestlé’s main competitor, France’s Danone, took full ownership of South Africa’s leader in fresh cultured dairy products, Clover.

Investments in African infrastructure, services and retail sales, development experts note, could have a very positive impact on African economies. Unlike extractive industries, they say, growth in consumer-oriented sectors often lead to the creation of many more jobs and stimulate domestic spending.

Benefits of growth

Africa’s booming middle class and its recently-acquired purchasing power is the main reason behind the new trend in FDI to the continent. Various researches suggest that the number of Africans who can afford to buy more than the necessities of daily life is rising rapidly. A much-talked about report by McKinsey, a US consulting firm, estimates that the continent is home to around 50 million middle-class households (defined as those with incomes of at least $20,000), as many as in India. One in every 10 Africans, says a study by the French aid agency, is already a “solvent consumer” — those who can afford the latest smart phones, the newest computers and dinners at trendy restaurants.

The rise of this middle class is linked to the strong economic performances recorded in many African countries since the end of the 1990s. Average economic growth has been around 5 per cent a year, while average inflation rates declined to 8 per cent from an earlier high of 22 per cent. From 2000 to 2010, six of the world’s 10 fastest-growing economies were in sub-Saharan Africa, reports The Economist, an authoritative London weekly. In fact, the publication argues that Africa is the site of “the surprising success story of the past decade,” high praise from a magazine that is generally not very enthusiastic about the continent.

Strong growth — and not only in the oil-rich countries that have benefited from booming demand from emerging economies — enabled millions of people to move up the financial ladder. And while growth in oil-producing countries usually did not create many new jobs, growth in many others did, spurring consumer demand and boosting domestic spending. In South Africa, Tunisia, Egypt and Morocco, Africa’s four most advanced and diversified economies, domestic consumption has been the largest contributor to growth in recent years.

Policies, peace and governance

Africa’s improved economic prospects are also a result of good economic policies, says the World Bank. In Ghana, Uganda and Tanzania, for example, business-friendly policies opened new markets to foreign investors and encouraged start-ups. Angola and Rwanda became fast-growing economies after long civil wars.

Some also argue that the continental development plan, the New Partnership for Africa’s Development (NEPAD) also contributed. NEPAD “did help shape a new, more positive perception of Africa,” argues Patrick Osakwe, an economist with the UN Economic Commission for Africa (ECA) and co-author of a study on FDI to Africa. By emphasizing the importance of good governance, Mr. Osakwe told Africa Renewal, the plan has fuelled a momentous shift in the way the rest of the world sees the continent.

Expanding prosperity

For a continent so long regarded by outside observers as “hopeless,” the coming years are likely to bring more good news. Having weathered the global recession better than most regions of the world, Africa’s growth rate is now second only to that of Asia. Over the next five years, The Economist predicts, “The average African economy will outpace its Asian counterpart.”

Such promising prospects are central to Walmart’s expansion plans in Africa and other Western investors are likely to follow. With the continent’s combined consumer spending forecast to reach $1,400 billion by 2020, up from just $860 billion in 2008, companies from China, India and Brazil are also expanding operations in the region.

As foreign investors rush to benefit from the arrival of upscale African consumers, however, prosperity still remains elusive for too many others. “To expand prosperity, African leaders need to invest in infrastructure and education, to diversify their economies, so that many more people can benefit from growth,” argues ECA’s Mr. Osakwe. Western investors seem to think Africa is off to a good start.