Ethiopia’s prime minister Abiy Ahmed has been described as a reformist, credited with turning around the political, business and diplomatic climate in less than 12 months since he took office last year in April.

Abiy’s decision to pursue reconciliation with Ethiopia’s neighbour Eritrea, has paid dividends, triggering a wave of diplomatic breakthroughs in the Horn of Africa region.

The peace deal has also had positive effects in the political and economic spheres, as rebel groups that sought refuge in Eritrea return home, and trade is boosted by the new possibilities of access to the sea via Asmara.

Tackling foreign currency shortage

While Ethiopia has been the fastest growing economy in Africa for the past decade, the landlocked country of 100 million people is heavily dependent on imports.

At the time Abiy took office, analysts said the country’s foreign currency reserves had been reduced to less than one month’s worth of imports, partly because of high expenditure on big infrastructure projects.

Having warned that the currency crisis might last for 15 or 20 years because of government’s plans to continue expanding its infrastructure and the nascent manufacturing sector, Abiy has embarked on a process of liberlising the economy to attract foreign direct investment

In Julyu last year, Abiy called upon all hoarding hard currency to deposit it in banks, warning that those anyone who refused to heed the call would be tracked down.

A diaspora fund was also opened to ask Ethiopians living abroad to contribute towards easing the foreign currency crisis.

Privatisation of state companies

In February, Ethiopia’s finance ministry announced that government will give priority to the partial privatisation of Ethio Telecom as it takes notes on the best approach to the process of liberalising the economy.

By selling stakes in state-owned companies including Ethiopian Airlines, Ethio Telecom, Ethiopian Shipping & Logistics Services Enterprise, and Ethiopian Electric Power, Abiy’s government hopes to attract foreign investment and stimulate economic development.

Port deals with neighbours

Working to offset the limitations of being a landlocked nation, Abiy’s government has secured port deals with all its neighbours which have access to the sea (Kenya, Sudan, Eritrea and Djibouti).

• Ethiopia to jointly develop facilities at the Port of Djibouti in exchange for stakes in in state-owned Ethiopian firms.
• Ethiopia to set up a logistics facility at Kenya’s Lamu port.
• Ethiopia to have a stake in Port Sudan.
• Ethiopia to acquire a 19 percent stake in the Port of Berbera in the breakaway Somali region of Somaliland.
• Ethiopia now has access to Eritrean ports since the July 2018 peace deal was signed.

Djibouti handles roughly 95 percent of all inbound trade for landlocked Ethiopia.R

Under Abiy, Ethiopia has also embarked on a ‘Doing Business Initiative’, that is aimed at creating a conducive environment for businesses to start up and to also have access to finance.

Gambia’s parliament on Tuesday approved the Africa Continental Free Trade Agreement (AfCFTA), becoming the 22nd nation to do so, and effectively meeting the minimum threshold for the agreement to come into force.

The AfCFTA which was enacted last year, seeks to create the largest trade zone in the world, increase intra-African trade by 52% by the year 2022 and remove tariffs on 90% of goods.

African Union’s Commissioner for Trade and Industry, Albert Muchanga led celebrations of the historic achievement, posting on his office Twitter account that the AfCFTA market is ready for the launch of its operational phase in July this year’.

Source: Africa News

China Nanchang Engineering, has approached Harare City Council with a deal to supply 600 green energy (solar-powered) buses and additional fixed and working capital to service routes in Greater Harare Metropolitan.

The project will include a central business district (CBD) shuttle service and the Harare Urban Route will service all suburban routes. It’s divided into Norton, Southern, Eastern and Western suburbs.

According to recent minutes of the Environmental Management Committee, in the initial stage, 35 buses will service the Harare-Norton route. Chitungwiza will have 45 buses and Ruwa 20.

“Operations would be managed from four established depots, two in Harare, one in Chitungwiza and one in Norton,” read the council minutes. “Depots would be firstly fitted with maintenance and recharging facilities and would be large enough to cater for some 200 buses each.

“The project would have 12 battery swapping stations and they would act as charging centres. The bus types would be a new energy concept and Harare would be the first city to implement it in Africa. Transport services would run 19 hours every day from 4am to 11pm.”

Environment Management Committee chairperson Councillor Kudzai Kadzombe said the project would help the city in sprucing up its image while at the same time providing residents with decent transport.

This week Morocco hosts the 52nd Conference of African Ministers of Finance, Planning and Economic Development. The summit kicked-off with a press conference on Tuesday with an agenda to overhaul fiscal policy, trade and the private sector in a new digital age.

Delegations from across Africa arrived in Morocco for the opening of the 2019 Conference of African Ministers of Finance, Planning and Economic Development in Marrakech on Wednesday.

Held on the theme: ‘Fiscal policy, trade and the private sector in the digital era: A strategy for Africa’, this year’s conference calls on regional governments to use digital technology to mobilise domestic resources, and drive growth and competitiveness.

During the conference delegates will build momentum towards greater continental integration by hashing out the policy details of the historic African Continental Free Trade Area (AfCFTA) agreed at last year’s summit.

The pan-African trade-bloc needs to be ratified by three more member states before it comes into effect, as it currently has only 19 of the 22 ratifications needed.

Speaking at a press conference at the opening of the summit on Tuesday, Adam Elhiraika, the director of the ECA’s macroeconomics policy division said: “The African Continental Free Trade Area (AfCFTA) is an opportunity that will transform Africa.”

Spanning 44 countries with a total gross domestic product of more than $3trn, the free- trade zone aims to create millions of jobs by deepening integration.

Delegates will also discuss how to align national policies to boost tax revenues, improve the management of public expenditure, tackle illicit financial flows and make private finance available for public projects.

Tapping The Digital Economy

Sessions and roundtables will see ministers of finance from Morocco, South Africa, Egypt, Ethiopia, Zimbabwe discuss how African governments can work together to mobilise domestic resources and digital technology to raise the funds needed to realise their development goals.

Elhiraika stressed the necessity of using digital technology to drive revenues and make tax administration and collection more efficient.

“There’s a huge potential for African governments to mobilise domestic resources in the public & private sector. We can’t rely on external sources to bridge this gap.”

Countries in Africa have the potential to grow tax revenues by 3 to 4%, by bringing hard-to-tax sectors such as agriculture, digital economy, and informal sectors into the tax bracket, he said.

Side-line Events

Throughout the week experts and policy-makers from inside and outside Africa will debate policies for effective fiscal and digital transformation designed to foster sustainable growth.

A series of 17 side-events from March 23-24 will also provide a platform for members to debate and reach a consensus on Africa’s priorities for action.

One Saturday the ECA will the launch of 2019 Economic Report on Africa assessing the nature and performance of fiscal policy and offering an analysis of the challenges and opportunities ahead.

On Monday, the annual Adebayo Adedeji Lecture, named after ECA’s longest serving Executive Secretary, the late Professor Adebayo Adedeji, will pay tribute the late thinker’s contribution to discourse on development on the continent.  

High-level events will also be held to discuss the key findings and recommendations of a series of reports including the Economic Report On Africa, the 2019 Global Education Monitoring Report, and the ECA’s regional integration reports.

The conference runs from March 20 to 26th in the Morocco.

World Water Day is observed annually on March 22 to raise awareness about the vital importance of water to everything from public health and youth education to economic development and gender equality. The theme for World Water Day 2019, “Leaving None Behind” is based on a core pledge of the 2030 Agenda for Sustainable Development—that everyone must benefit from progress.

Globally, 663 million people still lack access to safe drinking water sources—the very resource on which a healthy, productive life depends.  Even for those who have access, services are often inadequate to meet basic needs. Across sub-Saharan Africa, 30 percent to 50 percent of rural systems are nonfunctional within five years of being built, and utilities in urban areas often ration water servicing. Similarly, water is often contaminated from urban, industrial, and agricultural pollutants that can compromise non-piped water systems, even those that are classified as improved water sources. Many of those who lack access to basic water services also live in conflict-affected states with poor governance, insecure tenure, high rates of poverty, and weak institutions. In countries with a history of conflict and civil unrest, the impact of refugees has further deteriorated the condition of water supply services.

Access to water is a human right and we are therefore aimed to reach the following objectives:

• Increasing the number of people with access to basic drinking water services
• Improving the ability of education and health facilities to provide and manage water services adequately in schools and clinics
• Catalyzing increased financing for the operations and maintenance of water systems, including through investing in innovative financial vehicles
• Improving the quality and reliability of drinking water
• Increasing the number of people with access to safely managed drinking water services

Water is a source for life and every sing person and species in our planet have the right to access to it.

As part of its efforts to extend financial inclusion the Nigerian government has created a scheme that allows small traders and artisans to access business loans via their phones.

On a sweltering Monday afternoon in early September last year, the vice-president of Nigeria, Yemi Osinbajo, visited a major market in Iwo, a town in the southwestern Nigerian state of Osun. Speaking from a raised surface, Osinbajo told the crowd that a new government programme known as TraderMoni would provide collateral-free loans to them.

“The policy of the federal government is to support businesses, not just big businesses but small, medium-sized businesses and micro businesses,” he said. “We recognise the hard work of traders who wake up everyday and toil in the markets with a dream to become financially independent and secure a future for themselves and their children.”

Since August last year, he has been travelling to different markets in Nigeria’s 36 states to chat with traders while announcing the loan scheme. Under the TraderMoni programme, the government is offering interest-free loans of between N10,000 and N100,000 ($27.5 to $275) to small traders and artisans, including food sellers, hairdressers, tailors, carpenters, tricycle drivers, and secondhand clothing sellers.

“Moni” is the word for money in Pidgin English, which is widely spoken in West and Central Africa. TraderMoni loosely means “the trader’s money”.

Simiat Kasali, a widow in Osun, has been struggling to cater for her four children. Most of what she makes from selling rice, garri and sugar at a small roadside store is used to support her family. The items in her store are worth about N20,000 combined.

“The loan from the government has helped me to buy more rice and sugar since that is what most of my customers wants,” Kasali says.

Nigeria’s informal economy is largely cash-based, meaning most small-scale businesses barely consider having a bank account. This sector, which includes traders like Kasali, accounts for about 60% of the entire economy or about $240bn. It creates much-needed new jobs (more than 80% of workers are informal), offering more chances to people than the formal sector.   

But access to finance remains a major barrier to expansion. Banks often do not only have high interest rates but also include collateral requirements when providing credit facilities. Most small businesses struggle to meet these demands, cutting them off from the capital they need to grow.  

TraderMoni is one of three micro-credit schemes under the Government Enterprise and Empowerment Programme (GEEP) launched in 2016.  The other components of the GEEP, which works with over 20 partner companies, are FarmerMoni (which offers loans to farmers) and MarketMoni (which cater to market associations, women cooperatives, artisan groups, trade associations and cooperatives). All of these programmes are executed by the Bank of Industry.

“These hardworking Nigerians are not ‘interesting’ to the traditional lenders: they have little to no financial track record, they have no collateral, some barely have formal identities,” Uzoma Nwagba, chief operating officer of GEEP, told Nigerian newspaper Business Day in an interview.

Some 4,000 TraderMoni agents, usually local people within the state, visit markets or other places of business with their computer tablets. To help traders and artisans identify them easily, these agents often wear caps or hats and yellow T-shirts with TraderMoni embossed on the front. They collect the recipients’ biographical details, phone number, GPS location of their point of trade, what they sell, and take photos of them – all of which are uploaded to a central server.

Within two weeks, artisans and traders who qualify receive a text message informing them that their loans have been automatically credited to a mobile wallet account on their phones. They can transfer the money from the wallet to a bank account, withdraw it from ATMs, or obtain cash from local mobile money agents. The loans must be repaid within six months at about 10 designated banks across the country. This includes an option to repay daily or weekly.

Initial loans are 10,000 naira but beneficiaries who repay their first loan within three months are automatically eligible for a second loan of N15,000. Essentially, the amount they can borrow grows as they repay, until it reaches the N100,000 ($275) cap.

“I used the loan I got in October to buy sewing cloth, and I will work very hard to repay so I can get more next time,” says 37-year-old Muktar Suleiman, a tailor in the northern Nigerian city of Kano.

With TraderMoni, the government is aiming to provide at least 30,000 loans in each of the country’s 36 states and the capital Abuja. So far, some 1.5m beneficiaries have received the loans. With an unbanked population of about 60.1m (only 39.8% adults out of a total adult population of 99.6m have a bank account), part of the larger target for the government is to push for financial inclusion. 

FarmerMoni and MarketMoni participants wanting to collect loans must have a Bank Verification Number (BVN), a centralised biometric identity for each Nigerian banking customer. For TraderMoni loan receivers, the second loan usually comes with a BVN requirement, meaning they have to be banked.

Despite the progress recorded by the TraderMoni initiative, there are fears that it could suffer setbacks that have afflicted government-funded programmes in the past, including corruption and the tendency for new administrations to abandon existing programmes amid changing priorities. In addition, people often think government loans are “free”, and might be reluctant to pay back.

In response the GEEP is deploying BVN as “digital collateral”. Loan receivers who default on repayment after several warnings won’t be able to use their bank accounts as their BVNs would be blocked. But it helps to tread carefully in this area, particularly as the government is aiming to promote financial inclusion.

Nwagba of GEEP is optimistic about loan repayments. “When you bring credit, real funding, to people who have historically not had such access, they tend to use it judiciously and repay, especially when repayment guarantees a higher amount in loans, almost automatically,” he told Business Day.

Source: African Business Magazine

Leading economic and political players from Africa and beyond, will convene in Casablanca for the 6th International Africa Development Forum – FIAD – a leading investment promotion and intra-African trade development event, taking place on 14 and 15 March.

The Forum, popularly known by its French acronym FIAD, (Forum International Afrique développement), has become one of Africa’s most important platforms for dialogue on South-South and North-South Cooperation.

This year’s event themed “When East Meets West”, is expected to bring together more than 1500 business leaders and decision makers from over 30 African and partner countries.  In light of the current global economic reconfigurations, and the challenges as well as opportunities of the fledgling African Continental Free Trade Area, they will identify concrete levers for enhancing Africa’s development.

They are also expected to develop partnerships, generate trade flows, as well as exploring investment market opportunities during the two days being hosted at Hyatt hotel in Morocco’s biggest commercial city.

The participants will also draw from highlights and successes of past FIAD events which to date, have generated over 17,000 business meetings, linking economic agents, investors, businesses and policy makers – making the forum one of the biggest platforms on African soil, at which influential financial and the economic and political stakeholders come together.

 An initiative of the Pan-African investment fund Al Mada – key shareholder at Attijariwafa Bank Group and its Africa Development Club,  FIAD is held under the patronage of Morocco’s King Mohammed VI.

Key focus points at the Forum, will include discussions on how to accelerate regional integration – particularly between east and west Africa; increasing value creation and standing up for female and youth entrepreneurs.

There will also be an awards ceremony, which will include recognising three African companies that are enhancing intra-African trade through trade relations, partnerships or productive investment in infrastructure.  There will also be awards celebrating the dynamism of young African entrepreneurs.

Written by Regina Jane-Jere (African Business Magazine)

The President of Equatorial Guinea, the Secretary General of OPEC and 20 African oil and gas ministers will headline Africa’s most influential gathering for the energy industry.

The African Petroleum Producers Organization’s (APPO) Cape VII Congress and Exhibition on April 2-5 in Malabo is set to bring together top oil and gas executives and the continent’s leading energy ministers, as well as international policy leaders.

In a press statement, APPO said the event will focus on policy reforms, Africa’s influence in energy geopolitics and increasing cooperation amongst African countries.In all, the conference will bring together more than 20 African governments, more than a dozen national oil companies and over 50 exhibitors and sponsors.

President of the African Petroleum Producers Organization and Minister of State for Petroleum, Nigeria, Emmanuel Ibe Kachikwu will present on the foundational reforms of APPO, and the organization’s aim to create a strong unifier of African oil producers on the international stage.

New discoveries throughout Africa, from Mozambique and Namibia to Senegal and Mauritania, have sparked fresh interest in exploration and production throughout Africa and mean APPO is set to welcome new producers into the fold.

Mohammed Sanusi Barkindo, Secretary General of OPEC; Dr Sun Xiansheng, Secretary General of the International Energy Forum and Yury Sentyurin, Secretary General of the Gas Exporting Countries Forum (GECF) are all expected to speak at APPO CAPE VII. With Africa taking a more prominent role in OPEC discussions following the entry of Equatorial Guinea to the group of oil producers in 2017, APPO CAPE VII will set the agenda for African producers interactions with global producers and markets in 2019 and beyond.

President of Equatorial Guinea,Obiang Nguema Mbasogo and Gabriel Mbaga Obiang Lima, Minister of Mines of Hydrocarbons, will be presenting on Equatorial Guinea’s Year of Energy in 2019. The small country in the Gulf of Guinea has taken a leading role on the international stage by joining OPEC, assisting in stabilizing the market and leading efforts for pan-African cooperation in the oil and gas sector.

The LNG2Africa initiative, for example, will focus on monetizing domestic gas, building up regional infrastructure and exporting gas from Africa to Africa. The Year of Energy 2019 celebrates regional cooperation in Africa and is centered on a series of events taking place in Malabo throughout the year.

Key African ministers including Tarek El-Molla, Minister of Petroleum, Egypt; Jeff Radebe, Minister of Energy, South Africa; Pascal Houangni Ambouroué, Minister of Petroleum and Hydrocarbons, Gabon; and Abdourahmane Cissé, Minister of Petroleum, Energy and the Development of Renewable Energy, Côte d’Ivoire are set to address issues of oil and gas infrastructure and regional cooperation at APPO CAPE VII.

Within its mandate for advocacy and coordination of UN System and international support for peace, security, human rights and inclusive development in Africa, the Office of the Special Adviser on Africa (OSAA) places a special emphasis on gender equality and the empowerment of women.

Over the years, African Governments, regional and sub-regional organizations have made significant commitments towards gender equality and women’s empowerment, including through:

• the Protocol to the African Charter on Human and Peoples’ Rights on the Rights of Women in Africa (2003), and
• the Solemn Declaration on Gender Equality in Africa (2004).

Following the adoption of the African Union Gender Policy in 2009, African leaders launched the African Women’s Decade 2010-2020 and the Fund for African Women to accelerate the implementation of all commitments on gender equality and women’s empowerment on the continent.

A Cross-cutting Pillar of Agenda 2063

At the 24th Summit of the African Union , held on 23-31 January 2015 in Addis Ababa, Ethiopia, African Heads of State and Government adopted Agenda 2063 , the continent’s 50-year structural transformation and development agenda. The Agenda’s sixth Aspiration is:

“An Africa where development is people-driven, unleashing the potential of women and youth”.

Inter alia, it calls for Africa to work towards full gender equality and the empowerment of women in all spheres of life.

In further recognition of the important role of women and girls in driving the achievement of Agenda 2063’s wide-ranging economic, environmental, socio-cultural, political, scientific and technological goals, the Summit declared 2015 “The Year of Women’s Empowerment and Development towards Africa’s Agenda 2063.”