The Africa PreBrief Blog
Africa Prebrief...Frontier and Diaspora Notes...May 22, 2012
|May 22 2012|
|APB Blog >>|
…Walter Lamberson’s “Facebook Doesn’t Need Your Money; Invest In Africa Instead” (http://www.good.is/post/facebook-doesn-t-need-your-money-invest-in-africa-instead/) wins our best headline of the week award. Pithy and provocative points are made with the juxtaposition of Facebook versus Africa as growth and Return On Investment (ROI) options. Our favorite is the line, “Another obstacle are continual fears about “risk”— a word often applied to earnest African businesses, but not to JP Morgan.” …
…DaMina Advisors (http://www.daminaadvisors.com/) include an interesting note in their latest newsletter that many African nations are actually re-leveraging with sovereign debt levels, in some cases, exploding to levels not seen since the 2005 G-8 summit that wrote off Africa’s debt. Botswana’s 7% of debt-to-GDP ratio of 2005 was 17% last year; Ghana whose debt level was 48% in 2005, after receiving a write-off of $1billion is now back at 45%; (back up after debt levels fell to 20%). Damina astutely points out “The only major difference was that while in 2004 most of Africa’s debt was owed to the IMF or World Bank and other G-8 countries, the new types of complex debt obligations being contracted by African governments is often owed to private financial entities, domestic lenders and shadowy international groups or Asian banks.”…
…Contrast Damina’s concern over rising debt from ‘new’ sources with Eurasia Group president Ian Bremmer’s celebration of Africa’s rising access to capital from these same ‘new’ sources, as described in his op-ed in Business Daily (http://tinyurl.com/ch3bau3 ). Bremmer celebrates what he calls the ‘power of the pivot,’ writing, “Africa has achieved this success in part because many of its governments can now pivot. For decades, African states were forced to turn almost exclusively to the International Monetary Fund (IMF), World Bank and Western governments for aid and investment, and the money often came with conditions – like democratic reforms and greater openness to Western investment. Things have changed. Over the past decade, China has sharply increased its investment in Africa, and state-owned companies have worked alongside the state-backed China Development Bank and the China Export-Import Bank to secure access to oil, gas, metals, minerals and farmland across the continent.” It will be interesting to see whose interpretation of Africa’s ‘pivot’ is more accurate.
…The news that South Africa’s Energy Minister Dipuo Peters favors shale-natural gas exploration is what we’ve expected. What’s interesting is the possibility that the move toward shale may eventually be part of a grand bargain on nuclear power – to move away from the latter. We’ll see. Both alternative fuel sources come with environmental risks and perhaps South Africa – long-term – will end up in the direction of the option which has the least dramatic disaster to date. Minister Peters reportedly said, “If fracking does get the go-ahead, it is unlikely to dissuade the government from implementing plans to build new nuclear power plants.” (http://www.bloomberg.com/news/2012-05-17/south-africa-energy-minister-favors-tapping-shale-gas-fields-1-.html)...
…Yet again another high-profile effort to promote entrepreneurship in Africa. This one – LIONS@FRICA (short for “Liberalizing Innovation Opportunity Nations”) is spearhead by an eclectic mix of national government, multi-lateral institution, media and multi-national corporation. The official release (http://meetthelions.org/announcing-the-lionsfrica-partnership-to-promote-innovation-and-entrepreneurship-in-africa/) states: “Today at the World Economic Forum on Africa in Addis Ababa, Ethiopia, high-level representatives from the U.S. Department of State, U.S. Agency for International Development, African Development Bank, Microsoft, Nokia, infoDev, DEMO, and the World Economic Forum launched a new partnership to promote innovation and entrepreneurship in Africa. The Liberalizing Innovation Opportunity Nations LIONS@FRICA partnership seeks to mobilize the knowledge, expertise and resources of leading public and private institutions to encourage and enhance Africa’s innovation ecosystem and to spur entrepreneurship across the continent.” It sounds like great PR for everyone involved and of course a few Small and Medium Sized Enterprises (SMEs) and entrepreneurs will benefit but we insist that much of entrepreneurship isn’t ‘taught’ or ‘fostered.’ If I had to choose between LIONS@FRICA or say 1,000,000 copies of Moky Makura’s book, Africa’s Greatest Entrepreneurs, translated in different languages and circulated for free on the continent, I’d choose the latter. See my “The Most Important Book On African Economic Development” (http://www.africaprebrief.com/pages/posts/the-most-important-book-on-african-economic-development-28.php )...
…speaking of entrepreneurs we received this in an email entitled, “Verone Makou – The Brainchild Behind The First African Tablet”: “Verone Mankou, is the brain behind the first African tablet to rival the iPad. At just the tender age of 26, Verone designed the entire tablet known as “Way-C” in his hometown, Brazzaville , Congo. “Way-C” means “the light of the stars” in a northern Congolese dialect. Just like any other person in the face of Africa, Verone had a vision when designing the Congolese tablet. His dream was to create the new technology that brings a “balanced quality and accessibility (price) perfectly”. He achieved the dream when the tablet was launched earlier this year, selling at less than half the price of the first Samsung Galaxy tab. Now how cool is that? Major!!But it wasn’t all easy for the Brazzaville based entrepreneur. He had to struggle, brawl and give great effort to find the funds to materialize his project. Potential investors turned him down, some people didn’t believe he would succeed and some folks laughed at the idea of Verone inventing the first African tablet. But as South African rapper PRO said: ‘Pressa Pusha Panda’, simply meaning: “Push and hustle until you get there”. However, Verone turned a deaf ear to all the critics and “haters” and persevered until the Congolese government heard of the great idea and invested 50% of the funds Verone needed. He continued to hustle and a couple of months later, the first 5000 devices of the touchpad were designed in Congo, but manufactured in China were released and made available in Congo. That’s not the end of Verone’s vision though, this is just the beginning. The young man plans to release a Smartphone, designed and made in Congo. He is trying to build a manufacturing plant in Congo, which will manufacture new technologies instead of sending the designs all the way to China. Now this is a visionary, a creative thinker and a futurist.” We don’t know the veracity of any of this but it sounds like the typical success story – same in Africa as anywhere else – a necessity driven talent whose persistence overcomes all odds, including lack of finance.
…Looking forward to Dambisa Moyo’s (http://www.dambisamoyo.com/ and @dambisamoyo) new book Winner Take All: China's Race for Resources and What It Means for the World. She tweets: “Pre-order my new book "Winner Take All"- out Jun 5 (UShttp://amzn.to/Jy2srL, CA http://amzn.to/LbYFPl) & Jun 28 (UKhttp://amzn.to/K3aiXm).” While I’ve celebrated Dambisa’s emergence I’m also mindful of some of the selectivity of her analysis. See what I wrote of her first blockbuster, Dead Aid: http://www.cedricmuhammad.com/body-guard-ii-dambisa-moyo-and-the-crisis-of-the-black-intellectual/. Yes, I’m still auditioning as her bodyguard…
…Here is the concluding portion of the response we received from a colleague regarding William Gumede’s “Rising Tribalism In South Africa” at Pambazuka News http://www.pambazuka.org/en/category/features/82016:
“Where I disagree with the analysis in Pambazuka is the simplistic labeling of elites being "corrupt" as the cause of a lack of development. Brother, a lack of development is not caused by corruption. The corruption is just one of many symptoms of the lack of development. More importantly, when corruption gets the blame it actually hides the true cause of the lack of development i.e. THE NEO-LIBERAL FREE MARKET PARADIGM THAT IS USED BY EXTERNAL INTERESTS AND THEIR JUNIOR PARTNER DOMESTIC ELITES TO ENSURE THAT THE ECONOMY IS STRUCTURED IN WAY TO SERVE THE GLOBAL ECONOMY AND NOT THE DEVELOPMENT INTERESTS OF THE SOCIETY.
“For example, there are so many forces at work right now trying to spin that the cause of the Arab spring rebellions was that the people were demanding for "free markets", to replace the markets or lack of markets that were under the control of corrupt governments and dictators (many of which financed by the west of course). They don't want people to connect the facts between rebellion and the conditions of life for people in societies who have their economies structured in such ways to serve global economic interests at the experience of national development interests. They want people to believe that if such countries were truly integrated into global free markets, not kept out by corrupt governments and dictators, there would not have been rebellions.
“From this line, the peoples of Libya, Tunisia and Egypt are now looking at a new challenge (which in many ways mirrors the same challenge Africans faced when they achieved political independence, but not economic transformation. Will they fall for the okie doke that if they accept free trade and foreign investment they will become "free" from the old dictators and not realize that their true enemy was not the dictators and their clan or tribe (they were just junior partners) but it was the deal struck between the global and the local elites to have an economic system which served global interests and not development interests?”
The debate rages on...
Cedric Muhammad/May 22, 2012
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Last changed: May 22 2012 at 10:33 AM