Month: August 2016

Africa: Japan-Africa Summit Gives Continent New Leverage

When the Tokyo International Conference on African Development (TICAD) was launched in 1993 by Japan in co-operation with the World Bank, the United Nations and the UN Development Programme, it was the first such initiative of one country seeking to deepen its partnership with Africa.

From August 27 to 28, when it meets in Nairobi, TICAD will be held for the first time in an African country. This milestone reflects the evolving nature of relations between Japan and the continent, and the more assertive and confident agency of African countries in their interactions with external powers.

TICAD was originally established to reframe Japan’s aid policy after the end of the Cold War. In the ensuing years Africa has seen a proliferation of forums for engagement with China, India, the European Union, Korea and Turkey, to name but a few.

For all the touted ‘first-mover’ advantage, Tokyo’s initiative and its aid and economic activities in Africa have not received the same profile as some of the other forums, most notably China’s Forum on China-Africa Cooperation.

From 1993 to 2013 TICAD was held every five years in Japan. While led by Japan, it has included the African Union Commission and international organisations as co-ordinating partners. TICAD supported the New Partnership for Africa’s Development (NEPAD) after it was adopted as the socio-economic programme of the continent, and the special relationship is evident in the fact that the NEPAD Agency and the African Union continue to be the focal point for Africa’s engagement with Japan.

Although Japan’s TICAD initiative started off as an articulation of its post-Cold War aid policy, over the years it has increasingly also incorporated trade and investment dimensions, largely in response to African countries’ calls in this regard.

Japan was until recently the world’s second largest economy; yet its overall trade with Africa in 2015 was US$20 billion, compared to China’s which was $180 billion. Japanese direct investment in Africa grew from $1.7 billion in 2005 to about $10.5 billion in 2014.

Although Japan supports international aid initiatives such as those of the Organisation for Economic Co-operation and Development, its aid is differentiated from that of other ‘Western’ donors. Its focus on infrastructure and low-key (if any at all) political conditionality is more reminiscent of emerging powers. Yet, it has not benefited among African countries from this fact at the political level. It has been seen as part of the West, and China’s strong diplomatic outreach to Africa with its emphasis on “South to South” ties has made a greater impact since 2000.

This year’s TICAD will be attended by some 35 African heads of state, and will also include a sizeable Japanese business contingent and a business fair. Japanese officials believe this initiative is an important means to expose their business people to the African business environment and enable them to meet and interact with African governments.

In another indication of the shift away from aid as the focal point of the relationship, Prime Minister Shinzo Abe has established through his office a Conference on African Economic Strategy which acts as the co-ordinating mechanism for all ministries, thus emphasising that relations with Africa have a strong economic focus and are not solely defined by the Ministry of Foreign Affairs. This is an important shift in emphasis for Africa and signals a maturing relationship and aspiration to place Japanese – African relations on a different footing.

While the India – Africa Forum Summit has moved from a three-yearly event to intervals of five years, TICAD is going in the opposite direction, a decision taken at the 2013 TICAD summit. The 2013 summit also established a follow-up mechanism to review and assess, on an annual basis, the implementation of the commitments in the Yokohama Action Plan.

At TICAD V in Yokohama, Japan committed $32 billion of public and private funds, including $14 billion in overseas development aid over the next five years. Infrastructure has also been an important dimension of Japanese assistance to Africa and in 2013 it committed about $6.5 billion in loans for infrastructure. In addition, there were commitments made in health, education, environment, trade and investment, agriculture and human resources.

Japan committed $500 million to train 120,000 health workers to provide universal health care and $500 million in co-financing with the African Development Bank for the African private sector. Moreover, in August this year Japan committed $120 million in aid to help counter-terrorism efforts in Africa. To aid its anti-piracy efforts in the Horn, Japan has a base in Djibouti, its first overseas base since the end of the Second World War, which it opened in 2011.

The summit in Nairobi is part of a bigger offensive to market Japan’s presence and assistance on the continent as Africa continues to be seen as the next frontier market with significant opportunities.

One should also not lose sight of the fact that Japan’s engagement with Africa is part of its geopolitical positioning in a changing global environment. This includes Japan’s ongoing desire to see UN Security Council reform, including a permanent seat in recognition of its ongoing significant support to the UN and its operations. The world in 2016 is a very different place since TICAD was established in 1993.

Since TICAD I, China has overtaken Japan as the world’s second largest economy. Under President Xi Jinping, China is flexing its muscles in its region, especially around maritime disputes in the South China and East China seas. While Africa has no ‘dog in the fight’, both countries have an interest in garnering international support for their positions on the disputed Senkaku/Diaoyu islands in the East China Sea. In recent years Japan has taken steps to reverse its post-war pacifist constitution, and in 2014 prime minister Abe ended Japan’s self-imposed ban on the export of weapons. Escalation in the tensions in the East China Sea is likely to have an impact on the world economy and maritime trade.

Will African countries be drawn into taking positions on Asia’s maritime disputes? In this China probably still holds the advantage, built on the diplomatic capital it has amassed over many years. However, it is in the continent’s interests to continue to support the observance of international law and respect and strengthening of multilateral frameworks.

In Nairobi though, the discussions are likely to focus on Africa’s developmental priorities and an assessment of progress on TICAD since 2013. Moreover, Japan is recognised as a pragmatic partner and African countries should not be surprised to see functional cooperation emerging between China and Japan, particularly in the infrastructure space where both countries enjoy strong comparative advantages.

The interest from so many eligible suitors has been an ideal environment for African states to maximise their leverage on investment, infrastructure projects and the like. As the Kenyan foreign affairs and international trade Cabinet Secretary Amina Mohamed said recently, “Everybody is competing in the same space. And if there is no competition, there is a problem. It simply allows us to choose the best.

Botswana: Expedite India-Africa Diamond Institute – Minister

Visiting Indian Minister of Tribal Affairs Shri Jual Oram has called on Botswana and Indian government to work together to implement the project for establishment of India-Africa Diamond Institute. Speaking at the reception hosted by the Indian Commission Oram said that the early establishment of the IADI will be mutually beneficial to Botswana and India with Botswana now being the Diamond Hub. Indian Diamond Institute (IDI) is all set to support the government of Botswana in setting up a state-of-the-art diamond institute in the country

According to the IDI, the courses to be taught at the institute in Botswana would include diamond cutting, polishing and grading along with jewellery manufacturing. A team from India will be in Botswana for three months to provide training to the professionals. Another area which Botswana can benefit from India, according to Minister Oram, is in the area of solar energy. "There is great potential for bilateral cooperation in the solar energy sector, with International Solar Alliance in place," he said, adding that India has skills and resources which can be beneficial to Botswana.

Ethiopia: Sekota to Get Ceramics Factory

The Himrawi Investment and Trading Private Limited Company recently laid the corner stone for the construction of a ceramic factory

in Sekota town of Amhara State at a cost of 220 million Birr.

Company General Manager Frealem Shibabaw said that the company has conducted study and ascertained mineral wealth of Sekota area.

According to the General Manager, Ethiopia exports eight million tiles from China annually expending millions of Birr. Thus, the factory would enable the nation to save hard currency that would have been spent for ceramics importation.

The factory has a capacity to produce two million tons of tiles annually that constitute only 24 per cent of local demand, she added.

The factory will also produce fire bricks useful and input for glass and cement factories. Indicating that such material is not produced in other African countries, Frealem said that the factory will be the first ever fire brick producer in Ethiopia. Quartz paint is another output expected from the upcoming factory. It will produce from factories residue.

According to Frealem, the factories will create over 300 jobs and pay 1.6 million Birr in the form of tax.

Laying the cornerstone, Culture and Tourism Minister Eng. Aysha Mohammed said that the people and the government of Ethiopia have not been utilizing the abundant resources but now efforts are under way to change the resource into economic benefit.

The Minister also called on governmental bodies at all levels and the community to provide support to the investor to make the project a reality.

Waghimra Zone Administrator Yilma Worku said that the project would contribute in creating jobs and promoting mineral wealth for investors.

He said the administration would continue providing support for the realization of the project.

South Africa: Marikana Miners, Residents Remember That Day Four Years Ago

Hundreds of miners and Marikana residents were on Tuesday commemorating the shooting of 34 Lonmin workers by police four years ago.

The miners were carrying knobkerries and making their way to one of the two koppies where the shooting took place.

Association of Mineworkers and Construction Union (Amcu) president Joseph Mathunjwa and some of the relatives of those killed were expected to speak. An EFF-branded tent, with a poster of party leader Julius Malema pinned to its side, had been erected near the site.

According to Amcu's Twitter account, R2m had been donated to the Marikana Massacre Amcu Trust Fund to help the families of those killed. The union appealed for more donations.

On August 16, 2012, police shot dead 34 striking Lonmin miners, apparently in an attempt to disperse them and end their strike. Ten people, including two police officers and two Lonmin security guards, were killed in the preceding week.

President Jacob Zuma subsequently established a commission of inquiry, chaired by retired Judge Ian Farlam, to investigate the shooting.

The commission found that no senior government officials, including Lonmin non-executive board member Cyril Ramaphosa, were responsible for the shooting. It however recommended a probe into national police commissioner Riah Phiyega's fitness to hold office.

Zuma suspended Phiyega in October last year, pending an inquiry into her fitness to hold office. In May this year, the inquiry heard that she had changed a statement prepared by police, shortly before addressing the media about the shooting.

She removed reference to the number of people killed and added that police were forced to use "maximum force" to defend themselves, Lindela Mashigo – a brigadier at the time and responsible for the police's communications department – told the inquiry.

On August 17, Phiyega dictated to him the changes to a statement to be read to journalists about the previous day's events.

The commission concluded its work in June.

Nigeria: Eight Countries Interested in 11th Abuja International Trade Fair

Eight countries have so far committed to send exhibitors to the 11th Abuja International Trade Fair slated for next month being organised by the Abuja Chamber of Commerce and Industry.

This was disclosed by the chairman of the local organising committee, Barrister Jude Igwe, in Abuja yesterday.

Igwe said the interest in this year’s fair by foreign countries was overwhelming.

A total of eight countries attended last year’s fair with 42 foreign exhibitors and 250 local exhibitors.

“Taiwan, Indonesia, India, Pakistan and the rest of them have committed to attend. We are sure that the number of exhibitors that they are organising will exceed last year’s even as we are still receiving acceptances,” he said.

The president of the chamber, Tony Ejinkeonye, said the fair will start on September 22 and has ‘Make it in Nigeria’ as theme.

“We see this trade fair that is coming as a catalyst or a tool to help drive the economy of Nigeria and help create jobs,” he said.

Nigeria Approves 3-Year Budget Plan, Projects Low Growth in 2019

The Federal Executive Council (FEC) on Wednesday in Abuja approved the Medium Term Expenditure Framework (MTEF) and Fiscal Strategic Paper (FSP) for 2017 to 2019.

The Minister of Budget and National Planning, Udoma Udo-Udoma, made this known while briefing State House correspondents after the Federal Executive Council (FEC) meeting which was presided over by President Muhammadu Buhari.

He revealed that there was extensive consultation with governors and Non-Governmental Organisations (NGOs) before the document was presented to FEC for the approval.

According to him, it is on the basis of the approved MTEF that the 2017, 2018 and 2019 budgets will be fashioned.

Mr. Udo-Udoma said “Today, the Federal Executive Council approved Medium Term Expenditure Framework and Fiscal Strategy Paper for 2017 to 2019, that is, the MTEF and the FSP for the next three years.

“As you know, the Fiscal Responsibility Act requires the executive to prepare the MTEF and send it to the National Assembly for consideration.

“And it is on the basis of the MTEF that the next budget will be fashioned.

“So, in short, we have started the process of preparing the 2017 budget.

“Before the MTEF was presented to FEC for consideration, there was extensive consultation with the private sector, governors and NGOs.”

According to him, the government intends to intensify efforts in pursuing manpower driven economy in the 2017-2019 MTEF.

He said with the MTEF, the government intended to pursue gender sensitive, pro-poor and inclusive social intervention schemes similar to the 2016 social intervention programmes.

“We intend to intensify effort to diversify the economy, we intend to go on with the implementation of ongoing reforms in public finance, we intend to enhance the environment for ease of business so as to generate private sector and private investment.

“We also intend to continue to pursue gender sensitive, pro-poor and inclusive social intervention schemes similar to what we did in 2016, our social intervention programmes are going to be sustained.”

He noted that the Federal Government had fixed 42.5 dollars per barrel and 2.2 million barrel per day production of crude oil as assumptions for the 2017 budget.

“Let me share with you some of the key parameters and assumptions which will be underpinning the 2017-2019 MTEF.

“Oil price benchmark: We intend to use 42.50 dollars as reference price in 2017. We are projecting 45 dollars in 2018 and 50 dollars in 2019.

“So, we are keeping to the very conservative in terms of the reference price of crude oil, even though we are expecting it to go higher than this. But, we are keeping to an extremely conservative price scenario.

“In terms of oil production, we are keeping to the same level of this year for 2017 and that is 2.2 million barrels per day.

“For 2018, 2.3 million barrels per day; and for 2019, 2.4 million barrels per day.

“In terms of growth rate, we are targeting 3 per cent growth rate in 2017 and 4.26 per cent growth rate in 2018 and a 4.04 per cent growth rate in 2019.

The minister explained that the 2019 rate was slightly lower than 2018 because 2019 would be an election year. The Minister of Trade and Industry, Okechukwu Enelamah, also disclosed that FEC had ratified the World Trade Organisation’s Trade Facilitation Agreement.

According to him, the agreement seeks to reduce the cost of doing business among members of the WTO He said “Council also approved the ratification of the World Trade Organisation (WTO) Trade Facilitation agreement.

“This is an agreement approved by all members of WTO in the ministerial conference that was held in 2013. “What that agreement seeks to do is basically to lower the cost of trade generally for everybody.

“There was clear understanding that everybody benefits from lowering the cost of doing trade, it is particularly beneficial to developing countries that want to be able to access the international market.

“Nigeria was one of the countries that approved the agreement then, and we have been going through the process to ratify the agreement so that it would come into effect.

“The idea is that the agreement will come into effect when it is ratified by two thirds of all the countries that approved it originally; we think that will happen sometimes this year.”

Ethiopia: Expansion of Industrial Parks to Flourish Textile Sector

In the second Growth and Transformation Plan, the country is working tirelessly to boost various industries that support the journey to industrialization

For several years, a lot of cloths that are usually displayed in a number of textile shops are mostly imported products. They are often transported into the country on the expense of huge amount of money. Unlike the previous trend, it seems that Ethiopia has become aware of the existing potential that enables it to produce the products on its own instead of simply producing them. Realizing the benefits, the nation has begun investing in the textile industry.

Accordingly, in the second Growth and Transformation Plan, the country is working tirelessly to boost various industries that support the journey to industrialization. The country's suitable climate is also very supportive for animal fiber and cotton production which are believed to be significant ingredients in the textile industry. On the other hand, the plenty of young human resource will assist every engagement in the sector.
 

The nation's commitment to encompass industrial villages seems to be appropriate decision. Recently, in addition to the Bole Industry Village, similar industry village has been marked in Hawassa. Furthermore, simultaneously the construction of extra industrial villages (parks) is underway throughout the country.

Hawassa Industrial Park (HIP) construction has costed more than 5 billion Birr. The expansion of such huge industrial park is the indication of the nation's progress to the industrialization. Since the nation has high potential in the sector, the nation has big chance to meet the demands of various customers. Development in the sector also necessitates the importation of modern technological equipment and transfer of knowledge so as to strengthen the production and productivity. Moreover it paves the way for experience sharing and training from the world textile partners. However, if the country could not compete on the world market, it would be a great loss. Because competing on the international market is not a preference rather it is an obligation, according to Fasil Tadesse, Managing Director of Kebire Enterprise and African Cotton, Garment and Textiles Federation Board and Ethiopian Textile Industries Associations President.

According to him, expanding industry villages has a number of benefits including attracting various companies, involving competent national organizations and accelerating the sector's business throughout the country and the world. Nowadays, the nation is on the right track through direct foreign exchange. The world giant garment industry companies are coming to Ethiopia. Therefore, the coming of these companies might be followed by other small but critical companies that are producing string, button and other similar bolstering textile materials. This could help the nation to reduce the import cost by producing these materials at home.

On the other hand, the situation facilitates the opportunity for technological transformation. Indigenous garment fabrics will share important experience from their foreign business partners. The training opportunity will also be managed. Other foreign based Ethiopian garment industries also will come back to use the opportunity. This shows the significance of the expansion of industrial zones.

Fasil believes that simply constructing industrial villages could not be a change, it needs the involvement of sector factories and companies. Especially, the participation of indigenous textile companies will play a significant role in building nation's capacity through enabling national producers to look for their nation brand.

On the other hand, the participation of the indigenous factories is important scheme to safe the sector from the influence of fluctuation of foreign companies. Here, the role of the government is vital to encourage national companies to engage in the sphere whether the foreign companies are engaged or not.

Noticing the experience of Bangladesh's textile firm, Fasil explained that over 80 percent of companies in the Bangladesh textile industry village are national companies. These could be happen for the reason that their government has been making notable encouragements for national companies by facilitating financial and material subsidies. It also provided useful training for the companies. Ethiopian government should learn from this. Fasil also noticed that in Ethiopia there are two main problems in the garment industry sphere. The first one is that most of the individuals who have the training and knowledge of the sector have no the capital to spent for it. Contrary to this, those who have not the understanding and educational background owned the capital. Moreover, the main problem is lack of mediation to coordinate these crucial business partners to work together so that they would be profitable in the textile industry.

The government should also facilitate the assistance of finance to the middle capital industries. On the other hand, the joining of foreign companies in the Ethiopian textile industry will be the bolstering companion to the indigenous companies. The expansion of industry villages is one of the most significant measure in the development of the sector. The accumulation of these measurements may reduce the problems related to the textile sector.

"The other problem in the Ethiopian textile industry is lower capacity of native factories and companies on investment. Therefore, to reduce such chains of problems the Ethiopian Textiles Industries Association is doing its level best through building the capacity of native companies and enabling them to be competent on market. It is also facilitating market opportunities," Fasil stated. The association is also working with stakeholders to address problems that are need the support of the government and other partners, he added.

The association is incorporated of over 80 native and foreign textile private owners and these companies could create over 60 thousand jobs nationwide. Last year, the textile factories have availed some 200 million USD of foreign exchange to the nation. However, this year this number decreased to only 100 million dollar. As it is clearly illustrated in the aforementioned statements the main problem is lack of capital, trained man power and management systems. Therefore, so as to manage the problem and ensure the country's gain from the sector, all stakeholders should work together; the government also need to make a continuous monitoring work beside the infrastructural development and expansion of industrial zones.

Nigeria: CBN Bars Nine Banks From Forex Transactions

The Central Bank of Nigeria has barred nine deposit money banks from all foreign exchange transactions and operations, pending the remittance of $2.12 billion dollars belonging to the Nigeria National Petroleum Corporations to the Treasury Single Account. Sources confirmed to Daily Trust that the nine banks comprise of three tier-one lenders and another six tier-two deposit money banks.

The affected banks are: Diamond Bank, First Bank of Nigeria, First City Monument Bank, Fidelity Bank, Heritage Bank, Keystone Bank, Sky Bank, Sterling Bank and United Bank for Africa.

“The affected banks remain barred from foreign exchange operations until they fully remit the NNPC funds into government coffers via the Treasury Single Account,” a source in the apex bank said.

When contacted, the spokesperson of the NNPC Mallam Garba Deen Muhammed told Daily Trust yesterday that when the corporation informed the presidency on the non-remittance of the fund to the TSA by the banks.

Meanwhile the United Bank for Africa (UBA), in a statement from its Head, Corporate Communications, Charles Aigbe, said that it has completely remitted all NNPC/NLNG dollar deposits to TSA.

Botswana: Abi Commends Benevolent Debswana

Lotlhakane East — Permanent Secretary in the Ministry of Minerals, Energy and Water Resources, Mr Kgomotso Abi, has commended Debswana for the spirit of benevolence.

Mr Abi said this when officially opening Olorato Children Care Centre and English medium, which was donated by Debswana in Lotlhakane East on August 18.

He reminded the community that the gesture by the mining company was not enough and implored residents to come on board and assist in children welfare.

Olorato Children Care Centre and English Medium board chairman, Ms Gloria Ramogola said the school aimed at accommodating orphans and vulnerable children.

She therefore called on residents to enrol many children at the centre; something she said would help the school raise the much needed finance for the day to day running of the school.

According to Ms Ramogola, the school, which has a capacity of 97 children, was built by Debswana mines with a budget of 1.3 million.

The American embassy also donated the furniture worth over P90 000 to the school.

For his part, Kanye South MP, Mr Abram Kesupile thanked all who contributed towards the success of the project.

Tanzania: NHC Rolls Out Big Dodoma Housing Plan

Civil servants and employees from the private sector have been assured of adequate accommodation in the designated administrative city of Dodoma, as the National Housing Corporation (NHC) seeks to raise 60bn/- to put up between 300 and 500 houses in the capital.

Even with the envisaged development in Dodoma, the corporation maintained that it will continue undertaking projects in Dar es Salaam, given its strategic location, commercial influence and the fact that 70 per cent of NHC’s property are in the commercial city.

NHC Director General, Mr Nehemiah Mchechu, said the corporation has so far acquired 236 acres of land at Iyumbu area,

adjacent to the University of Dodoma (UDOM), where it plans to establish a satellite centre. “In the first phase, we plan to build between 300 and 500 houses in the next twelve months. Apart from Iyumba we also have plots in Chamwino, Bahi and Chemba,” Mr Mchechu told a press conference in Dar es Salaam yesterday.

According to the DG, the stateowned real estate developer aims to raise 15bn/- from the sale of 97 units at Medeli Housing Estate in Dodoma and an additional 30bn/- from the sale of plots at its satellite centres across the country such as Safari City in Arusha and Kawe in Dar es Salaam.

“We have a total of 153 units at Medeli, out of which 97 are leased while the rest were sold out. Tenants occupying the 97 units will be given first priority in the sale but if they fail the houses will be sold to other Tanzanians,” he stated.

The NHC as well seeks to raise 15bn/- in outstanding rent fee by tenants in Dar es Salaam, while the funds will be channelled to the housing projects in Dodoma, he explained.

Mr Mchechu mentioned other possible sources of financing as loans from financial institutions and engagement of local and foreign investors. The construction industry currently contributes 24 per cent to the Gross Domestic Product (GDP), but Mr Mchechu was optimistic that the development of the designated capital will boost the industry’s contribution to 30 per cent.

“More still, as the country faces a shortage of 3.5 million housing units, with the demand increasing at an average of 200,000 units per annum, we hope the housing projects in Dodoma will help to ease the shortage,” Mr Mchechu noted.

The NHC boss was as well positive that the development of Dodoma will create more jobs, attract new investments, increase government revenues and eventually boost the economy.

President John Magufuli has lately stressed that he will make sure that the long dream of the founding Father of Tanzania, the late Mwalimu Julius Nyerere, of transferring the capital city from Dar es Salaam to Dodoma is fulfilled before 2020.

Since then, the Prime Minister, Mr Kassim Majaliwa, said he will be the first to have his office transferred to Dodoma next month and instructed cabinet ministers to follow suit.