An in-depth analysis of the trends shaping the entertainment and media industry in South Africa, Nigeria, Kenya, Ghana and Tanzania. Overview What’s trending now? It’s clear we’re in a rapidly evolving media ecosystem that’s experiencing Convergence 3.0 – a new and different wave of convergence driven by different capabilities and higher expectations, and manifesting itself simultaneously in multiple dimensions. To succeed in the future that’s taking shape, companies must re-envision every aspect of what they do and how they do it. It’s about having, or having access to, the right technology and excellent content, which is delivered in a cost-effective manner to an engaged audience that trusts the brand. For those able to execute successfully, the opportunities are legion. An already complicated E&M world is growing ever more so. Decision makers need data of unprecedented detail and granularity to navigate this world and inform their business plans. These are some of our many findings from such data in this year's Entertainment and media Outlook 2018-2022 – an African perspective. Click here to full download full report

At a supermarket in Harare, Zimbabwe’s capital, the finance minister is staring aghast at a pack of nappies. “This is absolutely ridiculous!”, exclaims Mthuli Ncube. “$49!” A manager says it cost $23 two weeks ago, before pointing out other eye-watering items such as $20 Coco Pops. Escalating prices are all too familiar to Zimbabweans. So are shelves bereft of staples and snaking queues at petrol stations. “What we are facing now, we last faced in 2008,” says Arrison Banda, a driver waiting in line. A decade ago hyperinflation devastated Zimbabwe. The crisis this time is subtly different. But it too has the potential to shatter a fragile economy. In 2009 hyperinflation caused by reckless government spending and money-printing forced it to abandon the Zimbabwean dollar and adopt the American greenback. That, along with the sane fiscal policies of a government of national unity, helped to stabilise the economy. But in 2013 Zanu-pf, the party led by Robert Mugabe, took back sole charge and went on a spending spree using other people’s money. Instead of printing it, the central bank simply began seizing up to 80% of dollars from exporters and replacing them with electronic money, notionally worth the same amount. In 2016 it began printing “bond notes”, which are supposedly as good as proper dollars. This coercive Ponzi scheme could only last if dollars kept coming in. But as soon as people realised they could not withdraw their dollar deposits, they stopped making them. There are more than $9bn of deposits in the banking system, but just $120m in hard currency underpinning them (see chart), according to Msasa Capital, a financial advisory firm. There is a thriving black market swapping “zollars”, slang for local dollars, for physical ones. Emmerson Mnangagwa, president since toppling Mr Mugabe in a coup last year, hoped that after winning elections in July he would be able to turn to Western governments for help. But this plan was ruined when his soldiers killed six protesters soon after the vote. Without international backing, Mr Mnangagwa and Mr Ncube, his cerebral technocratic finance minister who was appointed last month, have had to go it almost alone. On October 1st Mr Ncube announced two reforms. The first was a 2% tax on the value of electronic transactions. The second was the division of bank accounts into a “good” account for us dollars and a “bad” account for zollars. This has led to a belief, encouraged by the memories of 2008, that the local currency will be devalued. The result has been chaos. Over the past two weeks zollars have been trading at as little as 17 cents to the dollar. The devaluation has led to a surge in prices—and not just in imported goods like nappies. Football fans attending the Zimbabwe v Democratic Republic of Congo game on October 16th were shocked to learn that ticket prices had doubled on match day. There is a scramble to buy goods while the zollar is still worth something. Lots of shops have run out of staples, as customers rush to buy 50kg bags of sugar or maize. Others are doing a roaring trade in goods that will keep their value, such as generators or cement. Indeed, there is a building boom, as people hoover up materials. Many businesses have stopped accepting zollars altogether. One manager of a construction company describes how a week ago he paid for 700,000 bricks in zollars to build a lodge. This week the supplier cancelled the order, demanding dollars. The human cost is mounting, too. At the Parirenyatwa hospital in Harare, Gertrude Bhunu, 64, shows an empty packet of medicine: pharmacies want dollars. Boyfriends looking to marry have also been caught out: their future in-laws are refusing to accept the bride-price in zollars. One boss of a local company says he spends 75% of his time sourcing money. Every business is trying to maximise dollar assets and zollar liabilities on its balance-sheet. The response from the government reflects its chaos and divisions. Ministers from the old guard are trying to bully and ban their way out of the crisis, rounding up small-scale currency traders and outlawing the use of jerry cans at petrol stations. (People are using plastic bags instead.) For his part, Mr Ncube is insisting that a zollar remains worth a dollar, imploring people to trust the dual account system, and to give him time to implement reforms. The IMF and the World Bank will not offer support unless Zimbabwe repays its arrears to multilateral creditors. America opposes any plan to restart lending. Mr Ncube is forced to turn to outfits such as Afrexim, a pan-African bank that is mulling a $500m loan. Zimbabwe has also borrowed $250m from Gemcorp, a London-based investment fund. Not only are the terms of these loans murky, but they do not address the causes of the currency crisis—a lack of trust in a government that keeps ruining the economy and in the synthetic dollars it has effectively printed. This report appeared in the Economist under the headline"Zimbabwe’s shops are empty and prices are soaring"

The rapid advance of mining digitalisation, coupled with regulatory changes, will change the way that African mines operate and require careful consideration of the impact of those changes to mining stakeholders. The digital revolution The velocity of change sweeping across industries is increasing at unprecendented rates. In this turbulence, many business leaders ask how they should plan for a world they cannot imagine in five to ten years time. Two key principles hold in such a world. Firstly, digital strategic choices do not rely on fortune telling, but rather entail becoming ‘antifragile’ – equipping an organisation to thrive under volatility. Second, engaging with the Fourth Industrial Revolution is not a passive observation, but requires the recognition that intentional choices will shape the economic and social landscape of the future. As Alan Kay quipped, “the best way to predict the future is to invent it.” Each industrial revolution – First: water and steam power, Second: electricity, Third: electronic automation, and now Fourth: convergence across physical, digital and biological domains – has fundamentally altered how human beings live and work. The Fourth Industrial Revolution (4IR) is finding expression in the form of computing power, digital devices, sensors, connectivity, analytics, cloud computing, cognitive automation, the internet of things, technological ecosystems, and user interfaces. The digital age is set to disrupt the lives of individuals, communities, but particularly organisations. Mines are no exception to this rule, with far reaching implications and important opportunities. Mines on the African continent need to be cognisant of both the impending changes to their business, and of the impact of those changes to the societies in which they operate. To view full report, click here

Africa's Pulse is a biannual publication containing an analysis of the near-term macroeconomic outlook for the region. Each issue also includes a section focusing upon a topic that represents a particular development challenge for the continent. It is produced by the Office of the Chief Economist for the Africa Region of the World Bank. Recent data point to a weakening of economic growth in Sub-Saharan Africa in 2018, according to the new Africa's Pulse, a bi-annual analysis of the state of African economies conducted by the World Bank. The growth slowdown can be attributed to the lower than expected performance of the large countries in the region (South Africa and Nigeria). The downswing reflects poorer performance in agriculture following droughts and lower performance of commodity sectors. To view full report, click here

Cryptocurrencies, also known as virtual currencies, are a digital medium of exchange, which is unlike our normal fiat currency that exists in the form of physical bank notes or coins, or commodity money, backed by gold or other precious stones. The blockchain digital technology is as vital to cryptocurrencies as the central nervous system is to humans. Blockchain uses cryptography to create (mine) and store units, secure transactions, transfer tokens and effect payments. These processes metamorphose a crypto from being a mere digital token into a digitised asset with an economic value. That is to say, users can earn it, store it, trade it, transfer it, and sell it. African central banks by and large do not recognise cryptocurrencies as money, mediums of exchange or legal tender. But this is not only unique to Africa as similar patterns are being experienced in other parts of the world, especially developing countries. In Europe and the US, central banks have generally cautioned, but not banned, the use of or trading in cryptocurrencies. Although trading in cryptocurrencies in Africa has not spread widely to people at the bottom of the pyramid, their use is spiralling upward like a whirlwind in tandem with ICT technological advancements, high mobile penetration, growth in literacy, and financial inclusion and consumer sophistication. African central banks link cryptocurrencies to price volatility, fraud, money laundering, tax evasion, exchange control circumventions, terrorism financing and other criminal activities fuelling illicit financial transactions. While some of these concerns are genuine, others tend to be rhetorical and hyperbolic, as traditional financial systems are also fraught with similar risks. Gripped by crypto-phobia, African central banks have convulsed, issuing a plethora of warnings against the use of cryptocurrencies while others have gone to extremes, outright banning trading in them – an easier way out of what they perceive as the ‘crypto-quagmire’. According to a 31 March 2018 public notice issued by Adikwu Igoche, Manager, Research Development at Nigeria Deposit Insurance Corporation (NDIC), cryptocurrencies are not recognised as currency in Nigeria as they do not belong to the category of currencies or coins issued by the Central Bank of Nigeria (CBN). Similar notices were issued by the Kenyan Central Bank (KCB) as far back as December, 2015. Other African countries such as Morocco (2017) and Algeria (2018) have promulgated laws banning the usage and ownership of virtual currencies. The Reserve Bank of Zimbabwe (RBZ) on 11 May 2018 issued a notice warning the public against the use of cryptocurrencies and directing all banking institutions in the country not to provide banking services to facilitate any person or entity in dealing with or setting up cryptocurrencies. RBZ announced in the same notice that Bitfinance (trading as Golix) and Styx24, leading local cryptocurrency exchanges, were not licensed by it and any person buying, selling or otherwise transacting in cryptocurrencies, did so at their own risk and will not have recourse to the central bank. On 15 May 2018, Golix was directed by RBZ to cease all cryptocurrency exchange operations in Zimbabwe. Golix was in the process of rolling out its initial coin offering (ICO) which sought to raise $32m through a token sale. Golix was stopped right in its tracks by the RBZ, but didn’t take this threat lying down. Golix filed an urgent chamber application with the High Court in Zimbabwe challenging the legality of RBZ’s ban on the basis that the central bank acted illegally, irrationally and unconstitutionally and outside the ambits of administrative law in closing its virtual currency exchange. The High Court, on 24 May 2018 issued a default judgement against RBZ and ruled, inter alia, that “The ban issued by the respondents [RBZ] through letter dated May 15, 2018 against the applicant [Golix], directing it to cease its operations, shut down its cryptocurrencies exchange business and ordering the closure of its bank accounts with its bankers, be and is hereby suspended…” It seems central bank challenges in dealing with virtual currencies are not only restricted to Africa. India seems to be faced with similar challenges on how to deal with virtual currencies, just as Africa is. The Reserve Bank of India (RBI) on 5 April 2018 issued an official statement banning financial institutions and consumers from the use of virtual currencies. The RBI notice read as follows: “Reserve Bank of India has repeatedly cautioned users, holders and traders of virtual currencies, including Bitcoins, regarding various risks associated in dealing with such virtual currencies. In view of the associated risks, it has been decided that, with immediate effect, entities regulated by RBI shall not deal or provide services to any individual or business entities dealing with or settling virtual currencies… ” The Internet and Mobile Association of India (IAMAI) filed a petition with the Indian Supreme Court challenging the RBI ban on virtual currencies and seeking court relief to set it aside. The court provisionally upheld the RBI ban on virtual currencies in May 2018 until a date was set for the hearing of the petition. The court heard the petition on 20 July 2018 but could only listen to limited arguments, postponing the matter to 11 September 2018 for a full hearing. The legal position The legal challenge for African central banks is that their cases may not hold water in courts as there is limited legal precedence and in many countries there are no laws that address issues of virtual currencies. Legal cases, triggered by central bank prohibitions involving virtual currencies, have only now started to appear before the courts. The banning of trading in cryptocurrencies from mainstream financial systems does not seem to be practical and effective. Such prohibitions force consumers to use black market trading avenues or simply resort to peer-to-peer (P2P) digital trading platforms. The South African Reserve Bank (SARB) has taken a very pragmatic approach. While the SARB does not officially recognise cryptocurrencies as ‘money’ but as ‘cyber-tokens’, it is considered as one of the pioneers in Africa over the use of cryptocurrencies. SARB has preferred to adopt a more cautious but pragmatic approach to ensure that the use of cryptocurrencies complies with relevant financial surveillance and exchange-control regulations. Already a sizeable number of merchants in South Africa have embraced cryptocurrencies and accept Bitcoin for payments. François Groepe, Deputy Governor of SARB, was quoted by the online Cryptonews on 25 May as saying the central bank has set up a special unit to review the possibility of putting in place crypto-specific policies and regulations. More stable alternative Africans are becoming attracted to cryptocurrencies not only as speculative investments, but as alternative and cheaper payment and settlement methods, conduits for capital investments and options for savings and storing value as most African fiat currencies are very volatile and unstable and do not hold value against major currencies such as the US dollar. Technological innovations underlying cryptocurrencies such as blockchain should be embraced by central banks as they have the potential to improve efficiency in financial services. Instead of throwing tantrums at technological innovations, African central banks should be pragmatic and set up specialised units dedicated to researching cryptocurrencies and emerging blockchain and other digital and artificial intelligence technologies to enable them to come up with informed and guided practical policy and regulatory interventions that work for Africa. Read original article on AFRICAN BUSINESS MAGAZINE

The Economic Commission for Africa is fully committed to supporting the African Union, Regional Economic Communities (RECs) and member States to ensure that the untapped potentials of the continent’s blue economy are fully realized, says ECA’s Southern Africa Director, Mr. Said Adejumobi. In welcoming remarks to delegates attending the 24th Intergovernmental Committee of Experts (ICE) of Southern Africa on the theme; “Blue Economy, Inclusive Industrialization and Economic Development in Southern Africa”, Mr. Adejumobi said the ECA recognizes the immense potentials of the blue economy for fostering industrial growth and economic development. He said the ECA will therefore continue to support the continent through research and analytical work, technical assistance, capacity building, advocacy and awareness raising activities so that it can collectively and sustainably benefit from its blue economy resources. “This forum is meant to serve that purpose of further debate and discussion, and policy articulation by member States in the region on the issue,” said Mr. Adejumobi, adding that the blue economy, which some refer to as the ocean economy is “Africa's hidden treasure”. “The blue economy can be the engine of economic growth, the basis of socio-economic development and industrialization for many African countries, if well utilized. The maritime industry, for example, is estimated at over $1 trillion, and there are other related and emerging sectors of tourism, offshore renewable energy, aquaculture, seabed extractive industries, marine biotechnology and bio prospecting,” he said. Mr. Adejumobi said Africa’s coastal sector remains largely underdeveloped, under-utilized, and poorly governed, which has enabled other forces from outside the continent to benefit more from it, than its citizens. In China, for example, citing a report of the Economist Intelligence Unit, Mr. Adejumobi noted that “the ocean economy contributed $962 billion or 10 % of its GDP and employed over 9 million people in 2014. In the United States of America, the ocean economy was valued at about $258 billion or 1.8% of its GDP in 2010, and in Indonesia, the ocean economy contributed about 20% of its GDP which is similar to the ratio of other middle income oceanic countries”. “While other countries and regions are harvesting the gains and returns from the blue economy, West Africa for example, is estimated to be losing about $2 billion annually from illegal fishing,” the ECA Southern Africa Chief said. He said some Southern African countries have adopted strategic plans and development blueprints to transform their blue economy sector. For example, South Africa hopes to grow its blue economy sector from 54 billion Rands and 316,000 jobs in 2010 to 177 billion Rands and about 1 million jobs by 2033, a feat Mr. Ademujobi said was remarkable. Seychelles has developed a National Blue Economy Roadmap through which it seeks to accelerate economic growth and diversification, while Mauritius has Vision 2030, which provides an overall development framework, including on the blue economy sector. “However, the blue economy sector is very complex and dynamic, with various challenges and risks which require more of collective action, cooperation, partnerships and regional frameworks in order to address them,” said Mr. Adejumobi. Some of the associated challenges and risks of the blue economy include issues of governance and security of the ocean, piracy and terrorism, climate change, ocean environmental sustainability, poor infrastructure and technology, effective production connectivity with land-linked and land-locked countries, financing, and poor technical skills and capacity, he said, adding that more needs to be done at the regional level in the transformation of the blue economy sector through an integrated and holistic approach. New frontier of African renaissance The African Union hails the blue economy as the new frontier of African renaissance and its representative at the meeting, Mr. Auguste Ngomo, said the blue economy opens doors for Africa’s industrialization and economic development. “Like the role played by charcoal and steam engines for the first industrial revolution or oil and electricity for the second, the exploitation of the ocean potentialities can lead us to our economic revolution. The potential of oceans, lakes, and rivers is unlimited,” he said. “We can be inspired by other nations and regions, learn and acquire experience from them but Africa must focus on its own path, on its own strengths and realities. Our evolution towards blue economy is an ambitious but achievable adventure.” He continued: “It moves us from an economy of harvests from limited resources to an economy of harvesting unlimited resources if we organize ourselves well. With the exploitation of unlimited resources come also sustainable financial means. But to approach this revolution we must completely change our perceptive.” Senior policy makers from the region, leading practitioners and experts, private sector operators, civil society, regional and international development agencies, including development financial institutions are attending the meeting. The meeting is hosted by the Government of Mauritius. Distributed by APO Group on behalf of United Nations Economic Commission for Africa (ECA).

Africa is the most profitable region in the world. A report by the UN Conference on Trade and Development states that between 2006 and 2011, Africa had the highest rate of return on inflows of Foreign Direct Investment: 11,4 percent. This is compared to 9,1 percent in Asia, 8,9 percent in Latin America and the Caribbean. The global figure is 7,1 percent. Examples of companies benefiting from bountiful profits in Africa abound: Sonatrach’s turnover from oil and gas alone was $33,2 billion; MTN Group’s turnover was about $10 billion; and Dangote Group’s turnover was $4,1 billion – all in 2017. A variety of factors drive up Africa’s profit prospects, making it imperative for European, North American, Asian, and Latin American businesses to invest, helping to foster the continent’s economic progress. Africa’s economic growth prospects are among the world’s brightest. Six of the world’s 12 fastest-growing countries are in Africa (Ethiopia, Democratic Republic of the Congo, Côte d’Ivoire, Mozambique, Tanzania, and Rwanda). Further, between 2018 and 2023, Africa’s growth prospects will be among the highest in the world, according to the IMF. Good news: sectors where foreign companies could have a comparative advantage, such as banking, telecommunications and infrastructure, are among the drivers of current economic growth in Africa – creating clear investment opportunities for foreign businesses. Africa’s growing, youthful population, amidst an aging population in most other regions, constitutes a formidable market. The continent’s population is predicted to quadruple from 1,19 billion in 2015 to 4,39 billion by 2100. In 2015 alone, 200 million Africans entered the consumer goods market. Maximising this burgeoning market size calls for actively engaging Africa’s structural economic transformation. Africa’s youthful population contributes to an abundance of labour, which is one of the region’s highest potentials for labour-intensive industrialisation, and lowers production costs, leading to benefits that far outweigh the cost of doing business on the continent. The hourly wage in Africa is less than 50 cents (for example, it’s $0,27 in Mozambique, $0,34 in Nigeria and $1,62 in Morocco) compared to $10,49 in UK, $7,25 in the USA and $6,57 in Japan. Engaging more foreign companies may help raise wage rates in Africa, improve labour market efficiency and generate additional resources for those left behind on the age ladder. Africa’s large deposits of natural resources promise a bright future for developing value chains. Agriculture and the extractive sectors are linchpins of national, regional and global value chains. Africa hosts 60 percent of the world’s uncultivated arable land. In 2015, the continent produced 13 percent of global oil, up from 9 percent in 1998. The growth trend of oil and natural gas production between 1980 and 2012 was amazing: from 53,4 billion barrels to 130,3 billion barrels for oil; for natural gas, from six trillion cubic metres in 1980 to 14,5 trillion cubic metres in 2012. As of 2012, Africa also controlled 53,9 percent of the world’s diamond resources. In 2017, the Democratic Republic of the Congo alone accounted for 58 percent of the world’s cobalt (used in electronics production) while South Africa accounted for 69,6 percent of the world’s platinum production in 2016 (used for catalytic converters and in other goods). Actively investing in adding value to these commodities, among other extractive activities, will shape global economic activities over the next five decades. Finally, emerging domestic developments lend credence to actively engaging Africa’s economic transformation agenda. Dr Ayodele Odusola is the Chief Economist, UNDP Regional Bureau for Africa. This article, courtesy of Africa Renewal, is reproduced from New African magazine. Read the original article on The Herald.

A report launched by the Institute of Chartered Accountants in England and Wales (ICAEW) has said that despite an economic slowdown, most African countries are having a positive economic outlook. This is according to a new report, “In Economic Insight: Africa Q3 2018,” launched Wednesday, the accountancy body provides GDP growth forecasts for various regions including East Africa, which is forecast at 6,3 percent, West and Central Africa as 2,9 percent, Franc Zone at 4,6 percent, Northern Africa at 1,8 percent and Southern Africa at 1.5 percent. The report highlights remittances as a key economic driver for most African countries with Nigeria recording the highest amount of $22 billion in 2017. Remittance income was emphasised in the report as a major economic factor for most African countries. Nigeria was the biggest receiver of remittances on the continent. The West African economic powerhouse received 29 percent ($22 billion) of total remittances flowing to the continent in 2017, mostly from the Gulf, the US and United Kingdom. Egypt was the second biggest receiver of remittances on the continent with $20 billion of remittances. One of the countries highlighted where remittance flows continues to play an important role in terms of external accounts is Ghana. According to the World Bank, remittance inflows amounted to $2,5 billion in 2014: equal to roughly 18,6 percent of total exports that year. However, in 2017 the remittance inflows subsequently declined to $2,2 billion equivalent to 15,8 percent of exports. The report, commissioned by ICAEW and produced by partner and forecaster Oxford Economics, provides a snapshot of the region’s economic performance. The regions include; East Africa, West, and Central Africa, Franc Zone, Northern Africa, Southern Africa. Last year, diaspora remittances were Kenya’s highest foreign exchange earner, overtaking tea, coffee, and tourism. Remittances contribute to financial services expansion and drive the growth of financial inclusion. The recent entry of global payment and remittance firms into the East African market has eliminated significant barriers that have hindered consumers and businesses in the region from taking full advantage of remittances. Ethiopia remains the region’s powerhouse, with growth forecast at 8,1 percent, thanks to the recent reforms under new Prime Minister, Abiy Ahmed. In Central and West Africa, growth is forecast at 2,9 percent. The constrained growth in the region is due to subdued non-oil economic activity by Nigeria –— the region’s powerhouse. Ghana, by contrast, is the best-performing country in the region with a forecast growth of 6,5 percent. “Despite the recent growth slump; all regions in Africa are projected to report a positive economic outlook, with remittance income expected to be a key economic booster in the coming months.” Michael Armstrong, Regional Director, ICAEW Middle East, Africa, and South Asia said. Growth in the franc zone is forecast at 4,6 percent, largely driven by a boost of 7,4 percent in the region’s biggest economy, Ivory Coast, where investment is driving rapid expansion. North Africa’s Egypt is forecast at 5,3 percent, as a result of structural and policy reforms, which have boosted manufacturing and investment. The county’s tourism sector has also continued to recover. Likewise, Libya is expected to record a growth of 16,5 percent, owing to posted improvements in oil production after the civil conflict. Southern Africa has been affected by continued slow growth by regional heavyweight South Africa, forecast at 1,5 percent. Angola, the region’s other economic leader, has the same forecast of 1,5 percent. Strong growth in both Botswana and Zambia is said to have little effect on the region’s overall performance. Uganda’s economic growth was reported to have recovered markedly last year. The country is expected to post a surplus of about 5,6 percent of GDP this year, supported by project aid and remittances inflows. The report notes that despite remittances playing an important role in African economies, policies should focus on reducing the cost of remitting funds. Ghana remittances and exports Assuming emigrant population proportions in their respective destination countries remain constant at 2017 levels, emigration to these destinations grows at the same rate as the 20-35-year-old population in Ghana and considering host country GDP per capita growth forecasts – indicate that Ghana’s remittance inflows will rise to just below $2,8 billion by 2020. Remittances’ ratio to total exports, meanwhile, will decline to 15,2 percent as Ghana’s exports rise sharply over the forecast period, driven mostly by higher oil production and prices. Regardless, remittance inflows will remain an important source of foreign exchange inflows moving forward. Remittances inflows are forecast to rise to roughly $5 billion by 2030, which represents a compound annual growth rate (CAGR) of 6,5 percent pa over the 2018-30 period. This robust growth is ascribed to the fact that Ghana’s young adult population is expected to expand rapidly over the forecast period, and this age cohort usually makes up for the bulk of emigrants. Also, while Ghana’s growth prospects remain favourable, significantly higher income levels in countries such as the US (Ghanaians’ preferred destination in 2017), will continue to incentivise emigration. — New Telegraph. Read the original article on The Herald.

Almost 70% of Africans make a living off agriculture and growth in the sector is eleven times more effective in reducing poverty than growth in any other. Development policy and private investment thus far have tended to focus on tangible assets: technology, mechanisation, fertilisers, finance and infrastructure. Yet the visibility and predictability of the market is also an issue. In some cases, even after smallholders ramp up productivity, they are unable to find a market to sell to. Yara CEO Svein Thore Holsther sets the scene by illustrating poor visibility in some of Africa’s markets. “Not too long ago I met with a farmer who used the right inputs, got the right results, only to realise that when he went to the market there was no market,” he says. “It’s heartbreaking to see farmers who invest in their crop but then find there isn’t a market for their additional production”. The solution, he argues, is to adopt a bird’s eye view. “I think we need to challenge ourselves to think holistically; to think systems rather than focusing on each individual business.” Indeed, supply and demand wavers through the idiosyncrasies of the market and all stakeholders in the value chain, from farmer to processor, have much to gain by formalising the structures at play. Connecting the dots Yet this is easier said than done. Value chains are replete with a whole range of players and synthesizing the market is no easy feat. “There are a lot more open market trading situations and a lot of uncertainty and that is what causes the problems,” says Simon Winter, Executive Director, Syngenta Foundation. “The more you tighten up those contracts the better.” Our approach is to work backwards from the buyer; work backwards from the large processors who market and sell the finished product. Kenya-based Diageo backed East African Breweries (EABL) – who gather mainly sorghum to produce beer – do exactly that. The brewers currently work with around 30,000 smallholder sorghum farmers in Kenya and invest along all stages of the supply chain. “On the large part we are still doing everything,” says Jean Kiarie Ngumo, Corporate Affairs & Sustainability specialist for EABL. “We will take care of the inputs we will take care of the financing; so we do everything.” This guarantees a set amount of raw material upon which the company can project each month. But it costs. Although large producers build smallholder capacity to secure crop, they often face their own financial constraints and are by no means a silver bullet. Amar Ali, CEO of Africa Improved Foods, a relatively new company in Rwanda working to produce nutritious food, draws a limit on his company’s capacity. “We do work with our aggregators to provide them with some working capital and some support but it must be said; there are offtakers and then there are offtakers,” he says. “We are not a Heineken, a Diageo or a multinational so there’s only so much we can do.”  Ali explains how last season AIF lost 90% of their locally sourced crop due to post-harvest issues such as storage and transport facilities. In response, the company began to source the crop “from the cob” or in other words at the farmer gates. This reduced rejection rates down to around 25% and was supported by the farmers; no longer required to expend time and effort transporting goods to local markets. This was effective but as Ali points out, ultimately outside their remit. “That’s not what we really want to do,” he says. “We don’t want to become last mile aggregators. We are processors and sellers of processed foods.” Working forward Looking at the supply chain from another perspective, from the ground up, predictability of demand is a problem and lack thereof may negate the smallholders interest in finding an institutional buyer. This in turn provides little incentive for farmers to access finance and technologies in an attempt to scale up, thereby preventing smallholders from shouldering the burden that private sector players like EABL and AIF currently have to bear. Winter explains the importance of regular demand.  “When you have a predictable offtaker with a predictable demand every year, it’s much better because you now know exactly what you need. Unfortunately, the large volume of demand for staple crops is not predictable.” Predictability is therefore key and Winter points to the work of USAID and TechnoServe, among others, in tightening up regularity on the demand side. Commodity exchanges are also a reliable marketplace for smallholder farmers offering predictable demand and price. They work a contract basis such as spot prices, forward prices, future contracts as well as options on future contracts. These contracts offer farmers stability and consistency of prices for their produce – in particular, future contracts which protect farmers against drops in prices. Many African countries have tried their hand at commodity exchanges since the South African Future Exchange led the way in the 1990s. While some have been successful, others not, their capacity to provide reliability to smallholder farmers should not go amiss. Finally, organisations like the Farm to Market Alliance (FtMA) are working to strengthen smallholder capacity and guide farmers into stable selling relationships with buyers. FtMA encourages farmers to engage in contracts extending beyond one season. This stability in demand then facilitates access to finance and loans used for feeds, fertiliser and machinery. Indeed, if the smallholder can guarantee sales over a number of years, he or she will be more likely to expand and improve operations which would again lessen the strain on the private sector. Businesses are then able to buy more crop from more farmers and bring more participants into structured value chains. By working to strengthen supply chains backwards from the private sector and forwards from the smallholder all participants in the agri-value chain look set to gain.

#2018 #Deloitte #EconomyReport More than 60 individuals from organizations across seven industry sectors participated in the survey. All organizations were either headquartered or were considered to have a strong business presence in Africa. Key findings: More than 50 percent of companies stated that the majority of their assignees into Africa are unaccompanied More than 80 percent of companies don’t have separate assignment policies for moves into, out of, or within Africa 50 percent of companies use a home based compensation approach for their assignees 80 percent of respondents believe that employees moving on local terms will increase in the next two years, illustrating a shift from the traditional expat approach Security is still the key challenge facing many assignments into Africa, particularly for accompanied assignees​. To view full report, click link below. https://bit.ly/2wJqrQT

#August2018 #EconomyDevelopmentReportinAfrica The 2018 edition of the African Export-Import Bank’s annual flagship report – the African Trade Report – titled “Boosting Intra-African Trade: Implications of the African Continental Free Trade Area Agreement” has been prepared at a time when concerted efforts are being made across the continent by both sovereign and corporate entities to deepen economic integration and boost intra-regional trade and cross-border investments. The report provides an important insight on the potential benefits of the AfCFTA Agreement in terms of growth, diversification of sources of growth and exports, development of global value chain, but also in terms of integration of African countries into the global economy. In particular, the analysis carried out shows that a complete tariff removal coupled with significant reduction in non tariff barriers could lift economic growth and raise the volume of exports and imports while significantly improving the terms of trade across Africa. The Report also undertakes a review of policy options and measures that could ensure a successful implementation of the AfCFTA Agreement and enhance the bargaining power of African sovereign entities in international trade negotiations. In particular, it is argued that transcending institutional and non-tariff barriers associated with national constructs to embrace shared institutions will enable countries to draw on economies of scale to increase efficiency and competitiveness while internalizing the costs emanating from negative externalities. At the same time, achieving higher growth and a trade development impact under the AfCFTA will depend on the commitment and steps taken by countries to eliminate non-tariff barriers, speed up the development and modernization of infrastructure, especially trade-enabling infrastructure, and raise the level of resources allocated to the financing of intra-African trade. The 2018 edition of the African Trade Report also provides a comprehensive analysis of the state of global and African trade in 2017. After falling below parity in 2016, the lowest in 15 years, the ratio of trade growth to GDP growth rose to 1.5 in 2017, reflecting the strengthening of global trade. In the midst of that favorable environment of growth acceleration and global trade expansion, Africa’s total merchandise trade gathered momentum growing much faster than the world average, driven by a recovery in commodity prices and strengthening cross-border investment. Furthermore, the Report provides a comprehensive analysis of the dynamics of intra-African trade, both at a regional and national levels as well as the composition of intra-African trade byproducts and sectors. Industrial products and manufactured goods continue to account for the lion’s share of intra-African trade. At the same time, and interestingly, manufactured products traded within the continent are increasingly dominated by medium to high-skill technology intensive manufactures. Looking ahead, Africa is expected to remain on a strong economic growth path, with improving trade performance in 2018 and beyond, riding on the global momentum of synchronized global growth led by increased investment and fiscal expansion. However, in the medium term, downside risks to global growth and trade include a contraction in global demand, especially if the ongoing transition and re-balancing in China leads to acute growth deceleration; sharp tightening of financial conditions could further stress highly-indebted sovereigns and corporates and, in the process, affect business confidence and investment decisions;and the rise of protectionist policies, most notably reflected in the escalating cycle of trade restrictions and retaliations, could derail the current growth momentum. To mitigate the adverse effects of these risks on African trade and growth, the Report argues in favour of a speedy implementation of the African Continental Free Trade Area which has the potential to significantly boost intra-African trade and accelerate the process of diversification of sources of growth and trade. To view full report, click link below. https://bit.ly/2mg7fph

#BrookingsInstitution #AfricaInFocus Wednesday, July 11, 2018 When it comes to Africa, it is no secret that the United States and China have very different philosophies. China adopts a more state-led approach, with state-owned enterprises and policy banks spearheading Africa’s infrastructure development. The U.S. is more willing to let private companies and the market take the lead on commercial development, while the U.S. government itself puts more emphasis on the continent’s capacity building and governance challenges. A long-standing question has been whether these two powerhouses could join forces and cooperate to advance Africa’s development. Such discussions have happened between the two governments. In 2014, it was reported that Obama’s signature Power Africa initiative was considering partnership with China on improving electricity in Africa. Around the same time, China reportedly approached the U.S. on collaboration on the ambitious Inga-3 hydropower projects in the Democratic Republic of the Congo. However, years have gone by without much progress on these speculations due to multiple considerations, especially political, economic, and reputational. As China expands its Belt and Road Initiative (BRI) in Africa, government-level U.S.-China cooperation in Africa continues to be scarce. However, this trend contrasts sharply with the growing collaboration between Chinese and American companies in infrastructure projects on the continent. Indeed, although the Chinese projects and financing have the tradition of favoring Chinese contractors and providers, the technical advantages of some American companies have made them the beneficiary of the Chinese BRI campaign. Multinational industrial giants appear to be winning substantially by partnering with major Chinese state-owned players in Africa. From early on, General Electric (GE) had come “fully prepared to partnering with mainland financial juggernauts, infrastructure builders, power producers to tap the business potential” along the Belt and Road. As early as 2015, GE partnered with China Machinery Engineering Corporation (CMEC) on the Kipeto wind farm. While GE provides machinery, equipment, tech support, and training, CMEC is the project contractor. Strictly speaking, Kipeto wind farm is not a Chinese project given that CMEC was only the contractor, but it has paved the way to more diverse and in-depth cooperation between GE and other Chinese companies in Africa. More recently, GE has been working with the state-owned Power Construction Corporation of China (Power China) to build power plants and grids in African countries such as Nigeria. In November of 2017, the two companies launched a roadshow in Nigeria, Ethiopia, and Kenya, during which they showcased an in-depth market report on Nigeria’s grid system in response to challenges identified by the two companies in powering the country. The report represents a shift toward more proactive market development efforts to ensure that projects along the Belt and Road not only solve their primary goals of generating power at the source, but also provide a long-sighted view of benefits for end-users and effectively distribute power according to the country’s energy needs. Toward this end, a memorandum of understanding was signed between GE and Power China. GE’s cooperation with Power China is believed to be an evolution and expansion of the previous EPC (engineering, procurement, and construction) project model for which Chinese infrastructure companies are famous. The Chinese and American companies are expanding beyond the tradition EPC role of Chinese contractors into the fields of “joint market development, joint fundraising, and joint operation.” The Chinese side has its eyes on GE’s ability to bring in advanced infrastructure industrial capacity, technological knowledge, and international financing channels based on GE’s good reputation and credibility. In this sense, the projects may still be owned by the African countries, tendered and developed by a Chinese company, but the American company supplies the equipment and technology as well as jointly raising funding from non-Chinese sources. Furthermore, the shared vision is to design, plan, and systemize the African market, transforming single projects into an expanded net of related upstream and downstream opportunities. Other American multinationals are also actively exploring business opportunities in Africa associated with Belt and Road Initiative. Caterpillar sees BRI as a key growth area for the sales of its construction machinery. Caterpillar has built one of the world’s largest construction machinery factories in the city of Xuzhou, China to meet the rising demand from the BRI. Its equipment has appeared in multiple Chinese construction sites in Africa, including the Abidjan port of Côte d’Ivoire, road projects in Ethiopia and Senegal, and the Lower Kafue Gorge Hydropower Station in Zambia. Caterpillar’s long history of operations in Africa has laid a strong foundation for Chinese business partners not completely familiar with the local environment. In order to expand the business portfolio, Caterpillar has organized multiple delegations of major Chinese contractors to Africa for market research through the network of its local agents, distributors, and service providers. Although Caterpillar has not revealed its sales volume associated with BRI, China contributed half of the company’s 22 percent growth in sales in the Asia-Pacific region in the last quarter of 2017, a number that is expected to grow in 2018. Honeywell identifies collaboration with Chinese contractors to “develop third party market” as a top priority. According to the CEO of Honeywell China, its Process Solution Department and Honeywell Universal Oil Products (UOP) have participated in more than 20 Chinese overseas EPC projects over the past 20 years, including in Africa. In particular, Honeywell China is keen on joining hands with leading Chinese companies to serve the third-party market under the Belt and Road strategy. It further seeks to introduce products and solutions designed for the Chinese market to high-growth emerging markets in order to facilitate the exports of not just “Made in China,” but “Created in China.” This plan caters to Beijing’s desire to boost its image as a “strong scientific and technological power.” While the governments may still be debating, U.S. companies and individuals have been creatively, actively, and broadly engaging China on BRI projects in Africa. Defense contractor leader Erik Prince has recently established the company “Frontier Services Group,” currently listed in Hong Kong, to serve the Chinese Belt and Road Initiative. The company’s strategy includes integrated security, logistics, and insurance service solutions aligned with the BRI. Prince has set up offices in Nairobi and Johannesburg to manage its business operations in Africa. The risk management, fast-reaction, static, and mobile security aspects of the company’s protective services are clearly designed to cater to the security risks associated with Chinese assets and nationals in Africa, a key headache for China’s economic engagement in the continent. It should be pointed out that foreign firms are at a disadvantage in competing for BRI projects, as BRI is designed to absorb Chinese overcapacity. But those firms that have well-established relationships in China and unique or unrivaled strengths beyond the reach of their Chinese counterparts stand to gain. Regardless of Washington’s preference, companies seem less concerned with either the morality or the modality of BRI as China’s political strategy.

#WorldInvestmentReport #AfricaReport #UNCTAD Global foreign direct investment (FDI) flows fell by 23 per cent to $1.43 trillion. This is in stark contrast to the accelerated growth in GDP and trade. The fall was caused in part by a 22 per cent decrease in the value of cross-border mergers and acquisitions (M&As). But even discounting the large one-off deals and corporate restructurings that inflated FDI numbers in 2016, the 2017 decline remained significant. The value of announced greenfield investment – an indicator of future trends – also decreased by 14 per cent. FDI flows to developing economies remained stable at $671 billion, seeing no recovery following the 10 per cent drop in 2016. • FDI flows to Africa continued to slide, reaching $42 billion, down 21 per cent from 2016. The decline was concentrated in the larger commodity exporters. • Flows to developing Asia remained stable, at $476 billion. The region regained its position as the largest FDI recipient in the world. • FDI to Latin America and the Caribbean rose 8 per cent to reach $151 billion, lifted by that region’s economic recovery. This was the first rise in six years, but inflows remain well below the 2011 peak during the commodities boom. • FDI in structurally weak and vulnerable economies remained fragile. Flows to the least developed countries fell by 17 per cent, to $26 billion. Those to landlocked developing countries increased moderately, by 3 per cent, to $23 billion. Small island developing States saw their inflows increase by 4 per cent, to $4.1 billion. Inward FDI flows to developed economies fell sharply, by 37 per cent, to $712 billion. Cross-border M&As registered a 29 per cent decrease, with fewer of the megadeals and corporate restructurings that shaped global investment patterns in 2016. The strong decrease in inflows was in large part the effect of a return to prior levels in the United Kingdom and the United States, after spikes in 2016. FDI flows to transition economies declined by 27 per cent, to $47 billion, the second lowest level since 2005. The decline reflects geopolitical uncertainties and sluggish investment in natural resources. To view full content , click link below... https://bit.ly/2MeUXt2

#Report #WorldBankGroup #Africa The Board of Executive Directors of the World Bank Group have endorsed a new strategy to partner with Sub-Saharan African countries and regional bodies to deepen regional integration. It will reposition World Bank Group support to help the continent realize fuller benefits from integration over the period 2018-2023. Titled “Supporting Africa’s Transformation: Regional Integration & Cooperation Assistance Strategy”, the strategy will promote economic diversification and strengthening of regional value chains, build sub-regional energy and digital markets, help create productive jobs for youth, and tackle cross-border health and climate change risks. “The World Bank Group brings a unique combination of financing, policy support, and convening power that can help facilitate collective action to address regional infrastructure gaps and policy and regulatory barriers to integration.  We are buoyed by the high level of commitment of African leaders towards promoting the regional integration agenda,” said Makhtar Diop, World Bank Vice President for Africa. The World Bank Group remains an important financier of regional integration initiatives in Sub-Saharan Africa, with existing commitments of over $10 billion.  Over the next three years, financing will increase by over $6 billion to assist the continent in addressing barriers to integration.  In addition, the provision of technical assistance and better analytics will help facilitate collective action by countries in priority areas.  The strategy has benefited from wide-ranging consultations with policy makers, regional bodies, and the private sector in Africa. To view full report click link below. https://bit.ly/2lyLIYB

#June2018 #UnitedNations #UNCTAD #EconomyDevelopmentReportinAfrica Africa is on the cusp of tremendous change, with the recent agreements on the establishment of the African Continental Free Trade Area (AfCFTA), the Protocol on the Free Movement of Persons and the launch of the Single African Air Transport Market. It is in this context that this Report contributes to a better understanding of the implications of intra-African migration for the continent’s socio-economic transformation. As the dream of the Single African Passport is within reach, the report provides evidence on the intimate correlation between two sides of the same coin: migration and trade. The report’s analysis of the role of intra-African migration in Africa’s development trajectory should make it a reference document for defining an African position in the Global Compact on Migration to be adopted in Marrakesh in December 2018. The report ends with a series of recommendations for African policy-makers, as well as for other actors willing to implement the necessary policy and regulatory changes for increasing the economic and trade benefits of migration within Africa. To view full report, click link below. https://bit.ly/2JYD2VS

#BusinessReport #SouthAfrica 19 JUNE 2018, 5:00PM / SENZENI ZOKWANA 📷Senzeni Zokwana. JOHANNESBURG - The South African guidelines for healthy eating promote the daily consumption of fish due to its nutritional value, but how much fish are South Africans really consuming? And with an ever-increasing population, how will we meet the future demand for fish? How do we ensure it’s available, accessible, and affordable to all? Internationally, consumption of at least two portions of fish per week is promoted as part of a healthy diet due to its many nutritional benefits. Fish contains low-fat, high-quality protein and is packed with vitamins and nutrients that can help reduce heart attacks. The omega 3 fatty acids are beneficial to brain development and thought to decrease the risks of depression, attention deficit hyperactivity disorder (ADHD), diabetes as well as arthritis. In reality, fish consumption in South Africa is estimated to be around 6-8kg per person a year (per capita), which equates to less than one portion of 200g per week. This is considered very low compared to the global average consumption of 20kg per capita, with countries like Japan as high as 50kg of fish for each individual. While consumption of fish is promoted for health reasons, one needs to be cognisant of the fact that overfishing has placed strain on the world’s wild fisheries, and in the future, with a growing world population, additional fish demand will need to be sourced through aquaculture (fish farming). The Food and Agriculture Organisation of the UN estimates that nearly two thirds of the global fish supply will be from farmed fish or seafood by 2030. At the same time, an additional 50 million tons will be required to feed the world’s population. Opportunities The local wild fishery sector is an important part of the nation’s food supply, supports the livelihood of thousands of coastal communities and is an avenue for economic opportunities. It employs more than 27000 people in the commercial sector and 7000 people in the deep-sea trawling industry. The industry is valued at over R6billion and earns more than R3.4bn in foreign exchange every year. In order to maintain our food and nutrition security through this important sector and open new avenues of economic opportunities, job creation and inclusive growth, the government has prioritised developing the local aquaculture sector through its Operation Phakisa: Oceans Economy initiative. Aquaculture (fish farming) involves breeding, rearing and harvesting finfish, shellfish and aquatic plants in aquaculture farms across the country. The Department of Agriculture, Forestry and Fisheries promotes the growth of the sector in a sustainable manner. 📷File photo: INLSA Over and above the potential socio- economic benefits of aquaculture, the sector can contribute towards reducing pressure on wild-caught fish stocks and help rebuild stock of threatened or endangered species. To date there are 35 aquaculture projects around the country that have registered with the Operation Phakisa: Oceans Economy initiative, and more aquaculture projects are in the pipeline. Since the launch of the initiative, more than R700million has been invested in the aquaculture sector by the government and private sector. Our investment into the aquaculture sector contributes significantly to our national goals of rapidly growing the economy and supporting socio-economic development. Opportunities in the aquaculture sector are supporting rural economic development for both inland and coastal communities. It has started a cycle of economic activity, employment and consumer demand in these communities. The government and relevant stakeholders in the sector are also unlocking the growth of the sector through the allocation of land and water leases for aquaculture, creating an enabling legislative environment, ensuring certification of product safety, opening up new local and international markets, and building capacity to meet the growth of the sector. For example, in order to address the scarce skills in fish health, the department has sent five state vets abroad to acquire an MSc degree in aquatic medicine this year. Moreover, through these projects, the government has also been hard at work to grow the contribution of small businesses which fulfil an important role of empowering people and drawing new entrants into the economy. Aquaculture is part of our bigger plan to tap into the economic and job creation potential of the oceans economy, whose industries are now diverse and on the rise. It includes marine transport and manufacturing; offshore oil and gas exploration; small harbours development; and coastal and marine tourism. The sustainable growth of these sectors is ensured through implementing a sound ocean governance framework. We expect that by 2033 the oceans economy sector is estimated to have the potential to contribute up to R170bn to the country’s GDP and create more than a million jobs. Since its launch in 2014, it has re- corded steady gains, and last year alone, the sector attracted more than R25bn in investment, while also creating more than 6500 jobs. The development of the oceans economy is part of the government’s commitment to move South Africa forward and address the triple challenges of poverty, unemployment and inequality. To realise its full potential in job creation and economic growth in the sector, it will require all South Africans, the private sector, industry, civil society and academia to partner with the government in rolling out our projects in communities across the country. Every citizen has an important role in helping us realise the country of our dreams. It requires each one of us to roll up our sleeves to build our nation and, where possible, lend a hand to bring others along on our journey. South Africans are encouraged to support and promote our various aquaculture projects around the country. The next time seafood is on the menu at your home or favourite restaurant, ensure it’s locally caught or from one of our nation’s very own fish farms. Senzeni Zokwana is the Minister of Agriculture Forestry and Fisheries. The views expressed here are not necessarily those of Independent Media.

#June2018 #WorldBankGroup #GlobalEconomicProspects On trade policy front, the outcome of some trade negotiations is still uncertain, and the risk of escalating trade restrictions has intensified, as new tariff announcements by the United States have led to retaliatory responses by major trading partners. In other policy developments, the European Union and the United Kingdom reached agreement on guidelines for trade negotiations, the U.S.-Korea Free Trade Agreement was successfully re-negotiated, the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) was signed by 11 member countries, and leaders from more than 40 African nations endorsed a framework establishing a future African Continental Free Trade Area. To view full report, click link below. https://bit.ly/2sZbYzl

#June2018 #TechReport #PWC The key to fighting high unemployment among the youth is to forge an alliance among businesses, educators and the youth to build the skills that lead to entry-level jobs in future growth sectors. This means businesses must play an active role in helping educators tailor their curricula to meet future requirements. Preparing the next generation for a mindset of lifelong learning is crucial to drive South Africa’s competitiveness in the face of the fourth industrial revolution, which is upending the nature of work across the world.  This undertaking is urgent, as South Africa’s youth unemployment is both an individual tragedy, as well as a community and socio-economic one. An income and the independence that goes with it are crucial for building a sustainable and thriving society. “Our most grave and most pressing challenge is youth unemployment. It is therefore a matter of great urgency that we draw young people in far greater numbers into productive economic activity.” Cyril Ramaphosa, President of South Africa, State of the Nation Address, 2018 Youth unemployment is a state of emergency. Unemployment and poverty are inextricably linked as income from wages account for around three-quarters of South Africans’ income. The youth carries a particularly heavy burden: an estimated 57% of South Africans aged 15 to 24 years were unemployed in 2017. In no other country assessed by the International Labour Organisation is youth unemployment wedged at such high levels. While improving to 45% during the years of elevated economic growth in the mid-2000s, youth unemployment has since fluctuated around the 50% mark. Female youth are especially vulnerable: their unemployment rate exceeds their male counterparts by 12 percentage points. Some indicators suggest the youth’s education levels have improved in recent years. Between 1996 and 2016, the number of those who had completed matric grew from 3.7 million to 11.6 million, an increase of 211%. This shows in improved literacy rates, which have risen from 85% in 1980 to 99% in 2015. However, many learners who start school do not complete their secondary schooling. Out of the 1.1 million pupils starting Grade 1 in 2006, only half progressed to write matric exams in 2017. Overall, the number of young South Africans aged 15-24 not in education, employment or training (NEET) has decreased only slightly from 32% to 31% between 2012 and 2017. Funding for education is a key concern for many young South Africans. Four in ten South Africans fall under the lower-bound poverty line and do not have the means to purchase both adequate food and essential non-food items. As a result, their children’s continued education often suffers. For many households, the combined cost of further education and training, travel and residence fees is prohibitive, especially with more than 36% of South Africans living in rural areas. This has a large impact on the number of youth that can enrol at higher education institutions. In 2017, almost 200 000 students enrolled for their first year at a public university, which is less than 2% of the estimated total number of learners that completed matric in 2016. One in two students on average graduates within regulation time, or two years thereafter, with an undergraduate degree or diploma. In spite of improvements in the youth’s general education levels, many businesses find it difficult to fill vacancies, especially those requiring specialist skills. The labour market favours highly-skilled candidates: Absorption rates for those with post-secondary education, i.e. skilled labourers, are the highest at 77%, compared to an average of 41% for semi-skilled labourers who have completed their secondary education. Although the majority of young people are currently employed in semi-skilled jobs, graduates of post-secondary education are more likely to find employment, as they compete with relatively fewer candidates. Emerging technology is both a challenge and opportunity for the youth While fighting current levels of youth unemployment as a matter of urgency, South Africa must also build a pipeline of future talent that can partake actively in the age of emerging technology such as automation and artificial intelligence (AI). A worldwide survey of 10 000 individuals showed that one in three respondents are worried they could lose their job to automation. Already, the nature of work is shifting as emerging technology becomes integral to how businesses operate. New jobs are emerging for those who produce and manage these intelligent systems, as well as for those learning to work hand in hand with emerging tech. South African youth are moving with the changes, as 2015 saw the largest proportion of students at higher education institutions (30%) enrolled in science, engineering and technology studies (STEM). As young South Africans push for higher levels of education, especially in STEM subjects, they become better able to adapt to the technological changes caused by emerging technology. For example, instead of competing with the new technology, they are ready to take on managerial roles to create or supervise the AI-based systems. A relentless focus on ushering young South Africans into STEM subjects in schools and further education and training will be crucial to allow South Africa to take advantage of the wave of emerging technology that is shifting the nature of work globally. In this context, educators and businesses must form an alliance to ensure that education programmes produce young workers with market-relevant skills. As a result, training strategies need to be constantly updated to reflect evolving business needs in an ever more digital and automated workplace. For the youth currently seeking employment in low- or semi-skilled jobs, an immediate solution is required. The Youth Employment Service (YES) is one of the first social compacts between government, business and labour to create one million job opportunities for young South Africans. Armed with a year of work experience, a CV and employment letter, a young person’s chance of future work increases threefold and can see him or her leaping out of unemployment and into a lifelong career. Young South Africans may also be able to access new forms of independent work through the emergence of digital platforms. As digital platforms can share intelligence and knowledge, independent workers can leverage their own value proposition, as the cases of ride sharing, delivery driving, home services, or market and field research show.   Through a two-pronged approach of incentivising the employment of young South Africans to allow them an entry into the workforce, as well as a longer-term focus on STEM to allow us to embrace and shape rapid technological changes, government, business and labour can turn around arguably the most significant socio-economic challenge facing us today. Maura Feddersen – PwC Strategy& Economist

#June2018 #Mckinsey_n_Company #EnergyReport Solar home systems can help to bridge the electrification gap in developing countries—if certain conditions are met. About a billion people have no access to electricity. While progress in lessening that figure has been steady, it is still likely to be at least 870 million in 2020. Expanding the grid is part of the answer to the question of how to bring power to these people, but it is not the only one. Many countries in sub-Saharan Africa and South Asia, which make up 90 percent of the world’s unelectrified population, are also exploring off-grid solutions, including solar home systems (SHSs). So are countries in the Caribbean and Southeast Asia, which account for most of the remaining unelectrified population. The global market for SHSs has grown 23 percent a year since 2012, representing more than four million units installed. Click link below to view full report http://bit.do/emUS7

#June2018 #GlobalEconomicProspects #SubSaharanAfrica #Report Growth in Sub-Saharan Africa is projected to pick up to 3.1 percent in 2018, from 2.6 percent in 2017. This upswing reflects rising oil and metals production, encouraged by higher commodity prices, improving agricultural conditions, and increasing domestic demand. Growth is expected to firm to an average of 3.6 percent in 2019-20, as the recovery strengthens in Angola, Nigeria, and South Africa—the region’s largest economies. Nevertheless, growth will remain below its long-term average, with continued weak convergence of per capita income towards average emerging market and developing economies levels. Tighter global financing conditions and weaker-than-expected commodity prices are the main external downside risks to the regional outlook. Domestic risks include heightened conflicts, delayed fiscal adjustment, and weak implementation of structural reforms. Click link below to read full report... https://bit.ly/2Jy67qO