RENDEAVOUR | MOTUS AFRICA
w w w. a f r i c a o u t l o o k m a g . c o m
Issue 88
DIGISTICS Enabling South Africa’s world-class supply chains
GREEN RESOURCES Sustainable and peoplecentric forestry business
Manufacturing South Africa Johan Steyn, Managing Director at Aerosud, discusses his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide
Mining Indaba Virtual 2021 In a celebration of the African mining sector, Mining Indaba returns for 2021 in a virtual format
travel magazine I
n a changing world, where the travel industry must adapt to challenging global situations, our mission at Outlook Travel remains the same. We will continue to showcase some of the world’s most inspiring destinations, offering real insight and comprehensive travel guides for when global mobility resumes.
ISSUE 04
The major component of the publication takes the form of our Outlook Travel Guides, providing executives, avid travellers and our existing 575,000 international subscribers with the ultimate rundown of all the major economic drivers and thriving hubs across the world, with exclusive input from tourism industry associations and stakeholders – the people who know these places the best.
WORLD’S BEST DISTILLERIES
The whisky tourism industry is flourishing
VIETNAM
A feast for the senses
QUINTANA ROO Beautiful beaches, compelling culture
You can join the vast numbers of tourism sector players enjoying the exposure we provide across our digital and print platforms with a range of options, from advertising through to free-of-charge editorials, extensive social media saturation, enhanced B2B networking opportunities, and a readymade forum to attract new investment and increase exposure.
YOUR TRAVEL GUIDE TO
BARBADOS Award-winning filmmaker Josh Trett discusses turning a hobby into a successful film and video production company
THAILAND TRAVEL GUIDE
THAILAND
MALAYSIA TRAVEL GUIDE
This Southeast Asian country is a perennial favourite, thanks to an intoxicating combination of beautiful beaches, world-renowned cuisine and incredible temple complexes
M A L AYS I A
Writer: Dani Redd | Project Manager: Jordan Levey
K
nown as the ‘Land of Smiles’, Thailand is a friendly country that welcomed 38.27 million tourists to its shores last year. There are plenty of reasons why this Southeast Asian destination is so popular. For a start, there’s the beaches. In the south, Thailand’s two coastlines stretch for miles, populated by swathes of icing-sugar soft sand, the bays speckled with dramatic limestone formations. Thailand is also home to 1,430 islands, ranging from full moon party spots like Koh Pha Ngan to the more off the beaten track Similan Islands, a national marine park popular with scuba divers. Then, there’s the food. Thailand’s noodles, stir fries and curries are beloved around the
world, characterised by the fragrant taste of lemongrass, kaffir lime leaves and tulsi. Every town is bursting at the seams with floating markets, street food stalls and high-end restaurants where you can try delicious local dishes. Thailand’s rich spiritual heritage also attracts tourists. Golden temples and larger-than-life Buddha statues can be found across the country. Visitors can experience colourful religious festivals in the northeast of the country or explore the underground cave shrines in Kanchanaburi and Phetchaburi. Despite Thailand’s popularity, it’s easy to find a quiet corner to relax, be it on a deserted island or an eco-retreat in the craggy mountains north of Chiang Mai.
Malaysia is a melting pot with a unique culture, a world-renowned food scene and a spectacular landscape of islands, ancient rainforest and mountains Writer: Dani Redd Project Manager: Joe Palliser
NAMIBIA TRAVEL GUIDE
T
here are many reasons why Malaysia is a tourist favourite. For a start, there’s the landscape. Imagine 878 islands, ringed with white sand beaches leading down to translucent waters. Vibrant coral reefs lie just offshore, home to a profusion of marine life. Inland are ancient rainforests, the shaded canopy seemingly impenetrable. Take a guided walk to learn about this habitat’s astonishing biodiversity. You might even catch sight of a tapir, or a silver-leafed monkey swimming through the jungle canopy. Outdoor enthusiasts will also relish tackling some of region’s towering granite mountains or exploring the intricate networks of limestone caves. Then, there’s the culture. Malaysia
is a melting point of Malay, Indian, Chinese and aboriginal groups (Orang Asli). There’s a packed calendar of religious festivals, including Wesak, or Buddha’s birthday, celebrated with processions of flowers and candles. Cities such as Melaka and Georgetown boast fascinating heritage districts where you can experience this fascinating fusion for yourself. Make sure you take time out to try Malaysia’s delicious cuisine, which reflects its multicultural population. Of course, Malaysia has a modern side too. It can be found in the SEYCHELLES malls, skyscrapers and fine dining TRAVEL restaurants in larger cities, such as the GUIDE capital Kuala Lumpur.
S E YC H E L L E S Most people visit this archipelago in the Indian Ocean for the beaches, but it has much more to offer than that Writer: Dani Redd | Project Manager: Jordan Levey
D
escribing the Seychelles, it’s easy to veer into cliché. These picture-perfect islands are blessed with white sand beaches lapped by translucent water, fringed with palm trees and interesting rock formations. The dramatic sunsets, laidback atmosphere and a wide range of luxury accommodation make them a popular spot for honeymooners. The Seychelles consists of 115 islands and some small islets, located
NAMIBIA Namibia is a country of rugged, otherworldly landscapes; a desert realm with a complex history and culturally diverse inhabitants Writer: Dani Redd | Project Manager: Joe Palliser
N
amibia is known for its sparse, otherworldly landscapes. It gets its name from the Namib, the world’s oldest desert; a sparse, windswept region extending 1,900 kilometres down Africa’s Atlantic coast. The desert is characterised by its red dunes, which plunge down towards the ocean at Sandwich Harbour and Skeleton Coast. It’s also known for its white clay and salt pans, such as Deadvlei, where there are hundreds of ossified trees. Another scenic spot in the desert is Moon Landscape, named after its eerie, pockmarked topography. But sightseeing in Namibia isn’t just about deserts. Inland you’ll find the green-gold grasslands of the Kalahari, and rugged mountains such as the Brandberg, Spitzkoppe and Damaraland.
Tourists flock to Namibia to experience its remote corners. Hot air ballooning, sand boarding and offroad quad bike excursions are all popular activities. When it comes to safaris, Namibia offers some unrivalled experiences – head to Etosha National Park to see big cats, elephants and black rhinos. Namibia has a fascinating history. It was inhabited as early as 25,000 BC, with tribes such as Ovambo and Herero gradually migrating into the country. In the “Scramble for Africa” Namibia became a German colony, known as German South West Africa, in 1884. After over a century of bloody battles, Namibia finally gained independence in 1990. These days it’s a country rich in historical attractions and cultural diversity; a country with plenty of stories to tell.
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in the Indian Ocean at a crossroads between Asia and Africa. Most of the action is concentrated around the three major islands: Mahé, La Digue and Praslin. Mahé is the largest and most populous; home to the capital, Victoria, and transport hub to the rest of the islands. La Digue is renowned for having some of the best beaches in the archipelago. Praslin, meanwhile, is home to the idyllic Vallée de Mai nature reserve. But there’s more to the Seychelles
than just the beaches. Trek through the granite mountains and lush rainforests of the Morne Seychellois National Park. Try some of the island’s traditional Creole dishes at a local restaurant. Or if you’re a nature lover, head to Bird Island to observe its population of fairy terns and common noddies, as well as the giant Aldabra tortoises endemic to the archipelago. You’ll be bowled over by what the Seychelles has to offer.
WELCOME
A New Dawn
EDITORIAL Editor: Sean Galea-Pace sean.galea-pace@outlookpublishing.com Deputy Editor: Marcus Kääpä marcus.kappa@outlookpublishing.com
Hello and welcome to the 88th edition of Africa
PRODUCTION
Outlook!
Art Director: Stephen Giles steve.giles@outlookpublishing.com
In our first offering of 2021, you’ll find an issue
Senior Designer: Devon Collins devon.collins@outlookpublishing.com
that is full of exclusive interviews with some of the
Junior Designer: Matt Loudwell matt.loudwell@outlookpublishing.com
biggest companies across Africa.
BUSINESS Managing Director: Ben Weaver ben.weaver@outlookpublishing.com Sales Director: Nick Norris nick.norris@outlookpublishing.com Operations Director: James Mitchell james.mitchell@outlookpublishing.com PROJECT DIRECTOR Joshua Mann joshua.mann@outlookpublishing.com TRAINING & DEVELOPMENT DIRECTOR Eddie Clinton eddie.clinton@outlookpublishing.com HEADS OF PROJECTS
This month’s cover feature sees us interview Johan Steyn, Managing Director at Aerosud, to discuss his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide. “Our wide-ranging capabilities is a unique offering – often referred as the Swiss army knife,” he says. “Deep rooted engineering capability also allows Aerosud to industrialise new products and processes in an independent manner – without significant oversight by the customer.”
Callam Waller callam.waller@outlookpublishing.com
Elsewhere, we shine a light on Nigeria and explore how the country is
Vivek Valmiki vivek.valmiki@outlookpublishing.com
reducing its reliance on agriculture and branching out to other business
SALES MANAGERS Donovan Smith donovan.smith@outlookpublishing.com Josh Hyland josh.hyland@outlookpublishing.com Ryan Gray ryan.gray@outlookpublishing.com PROJECT MANAGERS David Knott david.knott@outlookpublishing.com Krisha Canlas krisha.canlas@outlookpublishing.com Lewis Bush lewis.bush@outlookpublishing.com Sam Love sam.love@outlookpublishing.com
ADMINISTRATION Finance Director: Suzanne Welsh suzanne.welsh@outlookpublishing.com Office Manager: Daniel George daniel.george@outlookpublishing.com CONTACT Africa Outlook East Wing, Ground Floor, 69-75 Thorpe Road, Norwich, Norfolk, NR1 1UA, United Kingdom. Sales: +44 (0) 1603 959 652 Editorial: +44 (0) 1603 959 657 SUBSCRIPTIONS Tel: +44 (0) 1603 959 657
ventures. Featuring in our Expert Eye column is Dr. Kevin K. Kariuki, Vice President for Power, Energy, Climate and Green Growth at the African Development Bank, as he examines how a second wave of reforms could change Africa’s energy story. “Africa’s energy sector has made significant progress, yet despite its immense energy resources, it grapples with utilising these resources to power itself,” explains Kariuki. Be sure to check out our deep dive into Mining Indaba 2021 as we preview this year’s virtual event and showcase the event’s role in connecting the global mining community together. While you’re here, make sure you don’t miss our in-depth reports with New Way Power, Digistics, ARJO Africa, Rendeavour, World Courier Africa, Green Resources and more! And finally, be sure to head over to our website https://www.africaoutlookmag.com/ to discover more and subscribe, the easiest way to ensure you don’t miss subsequent editions of Africa Outlook magazine.
Email: tom.wadlow@outlookpublishing.com www.africaoutlookmag.com
Enjoy the issue!
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Sean Galea-Pace Editor, Outlook Publishing Africa Outlook issue 88 | 3
CONTENTS
20
10
REGULARS
6 NEWS Around Africa in seven stories
8 EXPERT EYE How a “second wave” of reforms could change Africa’s energy story
BUSINESS INSIGHT
14
10 Technology
Connecting Africa A world leader in hardware backed mobile device security
14 Agriculture
Diversifying Nigeria Africa’s most populated country
TOPICAL FOCUS
16 Agriculture
16
The Key to Inclusive Economic Growth Highlighting the realities and challenges facing the agriculture sector
EVENT FOCUS
20 Mining Indaba Virtual 2021 Where the world connects with African mining
4 | Africa Outlook issue 88
INDUSTRY SPOTLIGHT
26 Uganda Manufacturers Association The manufacturing sector in Uganda
EVENTS
116 Mining Indaba Virtual Resilience and regrowth in African Mining
118 THE FINAL WORD What will be the biggest trend impacting your industry in 2021?
AFRICA OUTLOOK MAGAZINE
58
38 80
F E AT U R E S
36 SHOWCASING
64 Digistics
Tell us your story and we’ll tell the world
Enabling South Africa’s world-class supply chains
LEADING COMPANIES MANUFACTURING
38 Aerosud
Manufacturing South Africa An internationally recognised supplier of aircraft interior systems
ENERGY
44 New Way Power
Backing up SA’s Power Supply
Excellence in Motion
70 A.G. Leventis Nigeria
Strength Through Supply Chain Adaptation and development in the logistics industry
76 Namdock
Shipping in Africa A leader in the West African ship repair market
Providing electrical peace of mind
LOGISTICS
HEALTHCARE
Planning Distribution
52 ARJO Africa
Delivering Safety and Efficiency to African Healthcare Exploring opportunities for growth in challenging times
SUPPLY CHAIN
58 Motus Africa
African Automotive Adaptation Adaptation and innovation in the manufacturing sphere
106
80 World Courier Africa A specialty medical logistics firm
CONSTRUCTION
86 Rendeavour
Rendeavour and the Rise of African Cities Change and adaptation in Africa
MINING
94 Kudumane Manganese The Core of Kalahari Mining Driving people-centric values in manganese mining
100 Jindal Mozambique Mining in Mozambique
Mining industry key player expansion
AGRICULTURE
106 Green Resources
Forward Thinking Forestry Sustainable and people-centric forestry business
Africa Outlook issue 88 | 5
NEWS Around Africa in seven stories… AV I AT I O N
Ethiopian Airlines adapting to change post-COVID
MINING
MINING INDABA RETURNS FOR 2021 IN A celebration of the African mining sector, Mining Indaba returns for 2021 in a virtual format to bring together visionaries and innovators from across the country. The unmissable two-day conference will be full of insightful discussions and themes which will provide beneficial advice on the back of a challenging and disruptive 2020. Since 1994, Mining Indaba has supported the sustainable development of the African mining
ECONOMY
Diversified economy TH E COVID-19 pandemic seems to have spared Africa the worse cases of mass infections and resulting deaths, however the continent’s economy is a different story. Especially when looking at the 6 | Africa Outlook issue 88
industry by connecting with leading investors and the global mining community. This year’s event will take place between the 2-3rd February 2021 and is free to attend online. Some of the speakers include H.E. Cyril Ramaphosa, President of South Africa, H.E Felix Tshisekedi, President of the Democratic Republic of Congo and Bold Bataar, CEO of Energy and Minerals, among many other industry-leading names. To register for free, click here!
smaller countries that survive on a limited range of active industries or resources to offer, the virus has caused problematic consequences. The diversified economies such as that of Ivory Coast, Senegal, Ghana, Kenya, Uganda, and Tanzania, have been slowed but
E TH I O P I A N A I R L I N E S , Africa’s largest commercial airline company, survives in the wake of the industrydisrupting COVID-19 pandemic. What spelt disaster for the aviation and travel sector saw Ethiopian adapt to the challenge. The company drastically shifted from a commercial airline to a freight service, repurposing 45 of its passenger planes to answer the problem. Meeting this rising demand of freight, the company managed to stem the flow of financial loss caused by the virus and the resulting lack of customers, and Ethiopian was able to avoid bailouts and hold onto its staff. At the same time, Royal Air Maroc (Moroccan national airline) utilised an innovative strategy to navigate the global crisis. The airline offered its customers free insurance alongside each ticket to cover the costs of medical expenses during international trips (between December May 2020).
not completely halted by the effects of the pandemic, due to their economies upheld by a multitude of sectors. However, those countries held aloft by a central industry, such as oil producers Algeria, Angola, and Nigeria, and tourism-based economies such as Morocco and Tunisia, have faced an increasingly difficult reality.
TRADE
New major AfCFTA trade deal agreed 54 O UT of 55 African countries have signed the African Continental Free Trade Area (AfCFTA), that began on January 01, 2021. According to a report by the African Export-Import Bank (Afreximbank), the deal brings together an estimated $3 trillion market, and may aid in the consolidation of previously untapped African exports amounting to $84 billion. The successful implementation of
AfCFTA is suspected to generate a total of $1.8 billion in welfare gains as well as the provision of two-million jobs, according to the UN Economic Commission for Africa (ECA). This plan was aimed to start a year prior, but with the sudden, unpredictable, and wide-reaching effects of the COVID-19 pandemic, it was put on hold until 2021. What this means for African trade is that 90 percent of all goods have become tariff free for many countries that are in league with the deal, an increase to intra-African trade, and aid women entering the general workforce.
A G R I C U LT U R E
AFRICA’S COCOA FARMING LANDSCAPE CO COA H AS always been a staple resource exported from Africa – Ghana and Ivory Coast alone grow 60 percent of the globe’s cocoa. In Ghana, cocoa plantations provide a vast number of jobs and subsequent livelihoods to individuals and communities alike, not to mention seven percent of the country’s export earnings (producing approximately 850,000 tonnes last year according to Statista). But the cocoa farmers largely live in poverty, with the mixture of labour-intensive work, long hours, and the climbing price of chemicals (used by the workers to maintain their farms), causing many to struggle to break from the inadequate states they live in. This is largely down to how much the individual worker is paid. Overall, the workers harvest thousands of tonnes. ENERGY & UTILITIES
ESKOM FUNDING
S U S TA I N A B I L I T Y
Siemens Gamesa to build 100-megawatt wind farm in Ethiopia S USTAINABLE EN ERGY company Siemans Gamesa has signed a deal to build a 100-megawatt wind farm in Ethiopia. The project is to be commissioned by 2023 and is aimed to power over 400,000 households in the country. Approximately based 150 kilometres south of Addis Ababa, the wind farm
will serve a rapidly growing Ethiopian population. Presently, around 90 percent of the country’s energy comes from hydropower plants. The $4 billion hydropower dam – the centre of Ethiopia’s economic development – is disputed over the issues surrounding water scarcity in many areas as a result of the dam itself. In light of this, Ethiopia has set a target of supplying renewable energy to cover 100 percent of its domestic demand by 2023.
South Africa’s ESKOM is to receive funds from multiple companies suspected of embezzlement. The money is being transferred due to overpayments in the construction of coal-fired electricity plants, and involves $103 million to be paid by ABB, a Swedish-Swiss engineering group. This transfer of money is the result of an investigation carried out by South Africa’s authorities, into the prospect that many companies cheated funds from the power utility company ESKOM. Four other companies are currently being looked into as a result of continual irregularities in connection to ESKOM.
Africa Outlook issue 88 | 7
EXPERT EYE
How a “second wave” of reforms could change Africa’s energy story The African Development Bank makes the case for adopting a new wave of energy reforms to kickstart a meaningful shift to and provide power to those who need it Written by: Dr. Kevin K. Kariuki, Vice President for Power, Energy, Climate and Green Growth, at the African Development Bank
A
frica’s energy sector has made significant progress, yet despite its immense energy resources, it grapples with utilising these resources to power itself. The continent’s energy sector is plagued by low rates of electricity access, unreliable power supply, and in many cases subsidised tariffs, resulting in utilities’ inability to recover the cost of producing electricity. In many circumstances, the cost of electricity production is inflated due to the high costs of capital as a result of sector financial risks. At the heart of these bottlenecks are issues relating to the reform of the power sector towards financial and technical sustainability. Though the power sector is experiencing its fastest growth rate in terms of generation capacity – with total installed capacity reaching 175GW in 2017, from 165GW in 2012 – close to 600 million Africans do not have access to electricity. To resolve this paradox, we must look at the issues through the lens of a “second wave” of enhanced power sector reforms. Since the 1990s, several African countries have carried out reforms aimed at responding to failures in the power utilities. These ‘standard model’ reforms, driven by development finance institutions like the World Bank and the International Monetary 8 | Africa Outlook issue 88
Fund (IMF), included commercialising electricity utilities, creating independent regulation and adopting cost-reflective tariffs, restructuring national monopoly companies to separate generation, transmission and distribution services, and boosting private sector participation. Despite these reforms, Africa’s power sector largely remains the traditional integrated monopoly utility structure, struggling to meet financial obligations and unable to expand and grow in support of economic growth agendas. In a study by the African Development Bank and the Association of Power Utilities of Africa (APUA), only 10 of the 42 countries assessed have wholly or partially unbundled the sector. The “standard” model reform overly focused on restructuring that did not leverage much impact. A second wave of reforms is needed, tailored toward the future development of the sector. In this second wave, regulatory restructuring is identified as the first step for most African countries. Establishing independent regulation will foster an equitable and rules-based playing field for electricity providers, consumers and private sector actors. But the independence of these regulators from political influence and other entities remains a challenge.
Of 34 participating African countries sampled by the African Development Bank’s Electricity Regulatory Index (ERI) 2019, just eight regulators, representing 24 percent, have developed quality of service regulations which include provisions for monitoring the financial, commercial and technical performance of regulated utilities. In addition to this, even fewer regulators can monitor performance against these regulations. The other key component of the second wave of reforms is the drive towards sector-wide operational efficiency and good governance. This reform will aim to build on the gains realised to date, but further address issues around operational efficiency, improved governance, transparency, improved technical performance
and financial sustainability. It will also address lessons learned and gaps identified from the first wave. Africa’s vast untapped energy resources coupled with the urgent need to connect the millions of Africans without access to electricity, constitute a huge market for investment that is worth billions of dollars. But to unleash these billions of dollars’ worth,
Africa’s energy sector needs to ensure real transformation. The region’s power sector would need improved reforms, this second wave, that is grounded on sound business principles and market needs. Key elements are financial and technical sustainability reforms focused on driving lower costs and innovative business models that incorporate various players. These reforms must result in providing access to millions of Africans, opening up capital investment flows, and engendering power sector trade. To close the gaps in electricity access, countries must adopt policies and institute purposeful agencies to drive electrification efforts. Offgrid renewable energy has gained
increased prominence, with some $1.1 billion invested in off-grid solar projects and enterprises across subSaharan Africa. The costs of extending off-grid renewable energy have fallen, but the continent has to do more to improve efficiency, affordability and reliability. Reforms have indirect effects on the performance of the power sector. This performance provides a boost to private sector confidence. The fastest-growing sources of private sector investment in the industry are Independent Power Producers (IPPS), alongside Chinese-funded projects. IPPs are now present in over 30 countries, with 270 operating or in construction totalling over 27GW of capacity. The reason for low access figures in Africa is mainly because governments and state entities cannot finance the electrification of their countries alone. They need private sector participation. Private sector participation in the traditional transmission environment is another opportunity that can greatly reform the power sector and foster significant growth in access; however, a majority of African countries are yet to allow private participation in electricity transmission. The monopoly nature of the transmission business does lend itself at the very least towards an independent transmission utility business. This can be a step towards attracting private participation in the transmission business and the creation of competitive markets. Whilst having competitive power markets is still a distant proposition in Africa, the long road starts with creating the environment for an independent transmission business and possibly a market operator. Independent transmission also allows for greater private sector participation in the generation sector and provides greater investor confidence to spur the industrialisation of the continent.
Governments have reacted to this and there are signals of change. The current interconnections happening in the region are not enough to enhance power system performance. African countries must increase power trade among themselves to improve electricity access and reliability. This holds the potential to leverage substantial reduction in power generation costs. According to the Programme for Infrastructure Development in Africa (PIDA) Outlook report, full integration and unlimited power trade would save $1.117 billion over the 2011–2040 period, that is, $33 billion each year and 17 percent of the cost of the continent’s electricity. Looking ahead, optimism about the sector will largely depend on effective and comprehensive political, economic and financial reform measures. These reforms should not only be about restructuring utilities but also about placing them on a sound financial, technological and commercial footing, allowing for open access and opportunities for participation by the private sector at all levels across the value chain.
ABOUT THE EXPERT Dr. Kevin K. Kariuki is the Vice President for Power, Energy, Climate and Green Growth, at the African Development Bank. Kariuki, a Kenyan national, is a chartered electrical engineer with over 30 years of experience in power system development, renewable energy development and energy efficiency, climate change and green growth, strategic energy partnerships, energy financial solutions, policy and regulation. Well known for his passion for the development of privately financed infrastructure, Kariuki is credited for his leadership in the successful development of over $1.75 billion of privately financed infrastructure projects.
Africa Outlook issue 88 | 9
TRUSTONIC
Connecting
Africa A
Dion Price, CEO of Trustonic
We chat with Dion Price, CEO at Trustonic, to discuss the current state of the telecommunications market in Africa today Writer: Sean Galea-Pace
10 | Africa Outlook issue 88
frica is changing. The continent is in the midst of significant transformation, with its telecoms market at the fore of this revolution. According to the GSMA mobile economy report, Africa is currently the fastest growing smartphone market in the world with around 477 million mobile phone users in Sub Saharan Africa, representing around 45 percent mobile penetration rate. Dion Price is the CEO of Trustonic. Having spent the past 20 years in mobile operation, digital transformation, start-up, hardware manufacturer, and consulting environments, Price is an experienced industry professional
that has witnessed the rise of digital transformation. Despite being born in the UK, Price has previously lived in the United States and Australia and has also been seconded to work in central Europe, Latin America, and Russia. Based in Cambridge, UK, Trustonic was initially created from a joint venture between ARM, Thales and G&D. Trustonic builds trust in technology by embedding security into smart devices and connected cars, and for businesses to innovate and embrace new opportunities with piece of mind. Using best-in-class hardware level security, coupled with software app protection, Trustonic secures revenue, powers innovation, and ensures reliability. Today, it counts
TECHNOLOGY
the world’s leading car manufacturers, financial institutions, and mobile operators as customers, as well as every tier one Android handset manufacturer. Africa Outlook (AO): Firstly, could you provide me with some insight into your career to date and explain how you became interested in the industry at first? Dion Price (DP): I’ve always had a keen interest in how things work, but with no option to take a degree in rocket ships, I undertook a more practical course in Business Management. After graduating I made it a mission to get into technology and the mobile market particularly interested me. It was a
time when the market was exploding with potential – the growth volumes were through the roof. My advice for anyone starting out a career is to look for such an industry to attach yourself to and hold on for the ride. My first job was as an analyst for mobile equipment manufacturer Lucent (which was later acquired by Alcatel and then Nokia). It was a fantastic global role that involved learning everything I could about the mobile market and advising the rest of the business on my observations and findings. With minute-by-minute changes it was clear that we were at the start of something really special, a new era even where six months of change compared with 50 years in the insurance or banking sector. It gave me a solid foundation of knowledge to build on – which still serves me well today. After Lucent, I spent a number of years working in different roles across the mobile industry (at Telefonica Digital, BrightStar, WaveOptics and others), primarily in sourcing and leading device vendor teams to find the best and upcoming innovations in the mobile space. After being fully immersed in technology for a while, I started planning a well-deserved year off in 2020 to go travelling with my family, but I was approached by the team at Trustonic with the CEO role. It was too exciting not to take on. Our plans were put on hold and I started in February just before COVID-19 took off – it was clearly meant to be! AO: What is your take on the industry in Africa at the moment? Is it an exciting space to be working in? DP: The African market is in a really interesting stage in its development and it has become clear over the past few years that the mobile industry has the potential to lead the digital engagement. Much of this growth will be spurred on by operators looking to migrate
their customers from 2G to 4G – a growth opportunity that is very exciting to be part of. For mobile operators, this will mean changing their current consumer proposition, to encourage people to purchase a higher priced smartphone. Device financing can potentially act as one of the ways to make smartphones more accessible. AO: Can you discuss Trustonic’s solution? DP: Trustonic’s cloud-based telecoms platform enables operators and retailers to increase and secure their revenues by offering competitive device financing deals, lowering the credit rejection rate, and expanding their customer base. By building security into the hardware of the device itself and allowing mobile operators to manage devices remotely, we reduce the risk associated with customers defaulting on their payment plans, warranty and insurance fraud, and secure the supply chain from losses resulting from theft and criminal activity. This also reduces the cost of customer care while improving the customer’s experience with clear, concise, and timely messaging sent directly to the phone, another way to encourage payment and reduce delinquency. AO: What about discuss digital inclusion in 2020? How important is this, particularly against the backdrop of COVID-19? DP: COVID-19 has seen a huge impact globally. Social distancing measures put in place have highlighted the value of connectivity for social and economic well-being. A reliable internet and the importance of a robust and inclusive digital economy and a range of digital service feels vital going forward. It has never been more urgent to close the digital divide. Mobile technology is extremely beneficial, particularly where there is limited infrastructure Africa Outlook issue 88 | 11
TRUSTONIC and mobile phones enable access to a range of services, including healthcare. Economies have been impacted at a global level and spending habits have changed due to reduced working patterns and lower income. In the context of access to mobile services, affordability of smartphones, and access to mobile technology has become even more important. Enabling mobile operators to provide device financing is now key to unlock this opportunity, growing revenues without incurring additional commercial risks. AO: In what ways can operators be empowered to financing devices to consumers in Africa? DP: Financing devices is one way to unlock the opportunity and make devices affordable for emerging markets. By using innovative technology solutions, mobile operators can provide financed mobile devices, without needing complex credit rating schemes. This enables them to sell higher priced smartphones and have control. If payment is not made, the operator has full control to suspend the customers service until it has been paid. It also means that the smartphone cannot be tampered with or unlocked in the case of theft and is immediately blocked negating any resale value. This empowers operators to offer more competitive device financing deals, minimises the risks involved, and increase access to crucial mobile internet technologies to millions of potential customers who are otherwise marginalised. AO: What does the future look like for Trustonic and wider industry? DP: The future is bright! We see the market moving and the opportunities created by technology to unlock digital access to a broad range of people across the world, but it’s particularly exciting for emerging markets. For Trustonic, we’re well 12 | Africa Outlook issue 88
“BY USING INNOVATIVE TECHNOLOGY SOLUTIONS, MOBILE OPERATORS CAN PROVIDE FINANCED MOBILE DEVICES, WITHOUT NEEDING COMPLEX CREDIT RATING SCHEMES.”
positioned to help mobile operators, retailers, and OEMs to open up access to smartphones for their customers. In terms of the wider industry outlook, devices have changed but they have remained on a path to grow in cost even at the low end, an unintended by-product of the US imposing sanctions against Huawei which has led to a mad dash of sorts to buy up chip sets for smartphones. This has resulted in supply and demand issues continuing to drive prices. Regardless, year-in, year-out, devices are breaking new records and so the need for more inventive ways to finance those devices rises. Especially given that disposable incomes haven’t risen, far from it. The future will see the introduction of more financing options that will give everyone access to great technology, after all, it shouldn’t only be the wealthy that can afford the high-end devices.
There’s no sign of a slow down at all. Security concerns remain though but fortunately we’re ideally placed to help customers to secure their devices and moving forwards, their digital futures. A big prediction of mine is that we’re going to see significant changes in operating systems next year and beyond. The sanctions imposed on Huawei have driven them out of the Google operating system - meaning they’re missing out on 86 percent of the global smartphone marketshare. However, they won’t take this sitting down. They’ve been busy building their own operating system - Harmony O/S – and I expect to see other Chinese handset manufacturers starting to do the same. It will be the start of a surge in development. Mark my words – 2021 will see a rise in conversations about alternative operating systems, beyond those of Android and Apple.
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NIGERIA
DIVERSIFYING NIGERIA
We examine how Nigeria is reducing its reliance on agriculture and branching out to other business ventures Written by: Sean Galea-Pace
N
igeria is the most populous country in Africa. As of 2020, there is an estimated 206 million people residing in the country and it is renowned as Africa’s biggest oil exporter, as well as possessing the largest natural gas reserves on the continent. Its economy is the biggest in Africa and the 24th largest globally, worth nearly $450 billion and $1 trillion in nominal GDP and purchasing power parity respectively. The country is often regarded as an emerging market by the World Bank and is recognised as a regional power on the African continent, a middle power in international affairs, and an emerging global power. Nigeria is multinational and a culturally diverse federation consisting of 36 autonomous states and the Federal Capital Territory. Nigeria’s most important crops include beans, rice, cashew nuts, groundnuts, cocoa beans, sesame, melon, maize, soybeans, bananas, and millet. Previously, the country was renowned for its export of groundnut and palm kernel oil. However, in the past few years, the rate of export of this produce has considerably reduced.
14 | Africa Outlook issue 88
AGRICULTURE AGRICULTURE IN NIGERIA Despite the influence of oil, agriculture remains the core of the Nigerian economy and provides the primary source of income for the majority of Nigerians. However, the industry is experiencing many challenges, particularly an outdated land tenure system that constrains access to land, a very low level of irrigation development, limited approach of research findings and technologies, high cost of farm inputs, poor access to credit, inefficient fertiliser procurement and distribution, inadequate storage facilities and poor access to markets. This has meant that agricultural productivity has been kept low with high postharvest losses and waste. While it is still one of Nigeria’s leading industries and employs twothirds of the entire labour force, the production hurdles have considerably slowed the performance of the sector. During the past 20 years, value-added per capita in agriculture has risen by less than one percent annually. It is thought that Nigeria has lost around $10 billion in annual export opportunity from groundnut, palm oil, cocoa, and cotton alone as a result of a continuous decline in the production of those commodities. Crop production increases haven’t kept up with population growth and it has meant that the resulting rise in food imports and declining levels of national food self-sufficiency. The primary factors that have undermined production has included reliance on rainfed agriculture, smallholder land holding, and low productivity as a result of poor planting material, low fertiliser application, and a weak agricultural system. However, since 2015, economic growth has slowed. Growth averaged 1.9 percent during 2018, before stabilising at two percent during the first half of 2019. In production, growth during 2019 was mostly driven by services such as telecoms. Agricultural growth remains below potential as
a result of continued insurgency in the Northeast and ongoing farmer-herdsmen conflicts.
OTHER BUSINESS IN NIGERIA The Nigeria fisheries subsector contributes around three to four percent to the country’s annual GDP and is a key contributor to the population’s nutritional requirements, consisting of around half of Nigeria’s animal protein intake. In addition, the sub-sector creates employment and income for a range of artisanal fisherman and small traders. Despite capture fisheries declining, Nigeria has big potential in both marine and freshwater fisheries including aquaculture. However, Nigeria’s domestic fish production is still significantly below the total demand, which is anticipated to be around 60 percent of the fish consumed. Alexander Booth, Managing Director at Kroll, outlines how stretched the Nigerian economy has been, in recent times, partly fuelled by the COVID-19 pandemic.
Nigeria’s capital Lagos is geographically wellplaced to benefit from international trade. Other economic drivers include Nollywood, Nigeria’s film industry “Longstanding domestic and structural constraints have been exacerbated by shrinking oil revenues and the wider fallout from the coronavirus pandemic. GDP is contracting, and
foreign direct investment (FDI) and portfolio inflows are both steeply down on last year,” he continues. “Restricted access to foreign exchange makes the picture even worse for investors, manufacturers and corporates, as the Nigerian government has long used forex restrictions as a policy tool to block imports and boost domestic production. “This has negative impacts for investors seeking to repatriate profits, further deterring new investors, and also increases default risks for domestic borrowers who have taken on foreign-denominated debt.” However, as a result of its strategic location, Nigeria has a bright future which will enable it to take advantage of the increased demand across Africa and other parts of the developing world. In order to harness the potential for exponential growth, Nigeria’s government leaders must pursue reforms aimed at scaling productivity, raising incomes and delivering vital services such as healthcare and education more efficiently. To increase productivity and incomes in the agricultural industry, the government could pursue land title reform aimed at opening more farmland without deforestation, expand the use of fertiliser and mechanised equipment and support a shift to more profitable crops. In urban areas, productivity suffers from a significant degree of informal employment, sometimes even by major corporations. This means that Nigerians can remain in lowskill, low-paying jobs and deprive the economy of the dynamism that competitive small and medium-sized enterprises create. The rise of internet start-ups that have emerged in Nigeria has showcased the level of talent that the country has at its disposal and showcases the considerable untapped potential at its fingertips. Africa Outlook issue 88 | 15
TOPICAL FOCUS
AGRICULTURE: THE KEY TO INCLUSIVE ECONOMIC GROWTH A griculture is one of the oldest and most traditional forms of industry. When human societies took the great leap from hunter-gatherers to farmers through the revelations of animal husbandry and sowing crops, a greater yield of food led to the gradual support of much larger populations than previous migrating tribes. These populations settled into villages, towns, and cities, some of which have survived to this day. In the present, agriculture remains the greatest contributing industry to many countries and their economies,
16 | Africa Outlook issue 88
African agriculture is the fuel for continental economic growth, but the industry faces new challenges caused by recent events Written by: Marcus Kääpä
but few rely so much on agriculture than those of the African continent. In 2004, agriculture made up 17 percent of Africa’s GDP, 40 percent of its foreign currency earnings, as well as providing livelihoods to over 60 percent of the continental population.
And with a population explosion over the past decades, managing to feed such a growing number of people has become one of the most important requirements for the region. Agriculture has become more important than ever, yet there is a continual percentage decrease in the proportion of the population who work in rural agricultural jobs compared to a rising number of urban dwellers.
AGRICULTURE
Africa Outlook issue 88 | 17
TOPICAL FOCUS URBAN DEMAND This shift in rural-to-urban living comes down to many factors. One such driving force is the search for urban-based work to earn a better wage and make a better living. As African urban centres grow, the demands facing farmers and other agricultural workers have never been so high. According to the 2020 Africa Agriculture Status Report (AASR), currently towns under 100,000 people account for one third of Africa’s population, over 50 percent of the continent’s urban population collectively live in cities of less than 500,000 individuals, and as of 2015 a recorded 42 “mega-cities” that house over two million people each were acknowledged. This is not the only focus of African growing population. Smaller villages and towns all over the continent are expanding rapidly, and through this explosive rise in numbers African urban agricultural markets are drastically growing to keep up with the
task of feeding the population. 2020’s AASR states the following: “Africa’s cities currently provide the largest and most rapidly growing agricultural markets in Africa. Out of total urban food sales of roughly US$200 to US$250 billion per year, over 80 percent comes from domestic African suppliers. In the coming decades, demographic projections forecast rates of African urbanisation as the highest in the world. “Africa’s rapidly growing cities and food markets offer the largest and fastest growing market opportunity available to the continent’s 60 million farms.” The 2020 AASR goes on to note that Africa’s urban population will increase at a rate of 3.5 percent annually from 2015 to 2025, which is double the estimated rate of Asia, and triple that of Latin America based on statistics taken from the UN in 2018. Demands for different produce in the market forces agricultural workers
As African urban centres grow, the demands facing farmers and other agricultural workers have never been so high
18 | Africa Outlook issue 88
ABOUT THE AASR The Africa Agriculture Status Report (AASR) is an annual publication that is published by the Alliance for a Green Revolution in Africa (AGRA) since 2013. The annual publication has become a reference point for emerging topics on agriculture in Sub-Saharan Africa, such as Staple Crops (2013), Climate Change (2014), Youth in Agriculture (2015), Agricultural Transformation (2016), Smallholder Agriculture (2017), Government Capacity (2018) and The Hidden Middle (2019). The report has grown to be an important handbook for Africa’s leaders in their plans to transform the continent’s agricultural prospects. Among the trends observed in past reports include increased public private partnership, adoption of technology, use of improved agricultural inputs, a greater focus on capacity development and an expanded focus on extension services.
AGRICULTURE chasing power for those low-income workers in urban areas that increased the suffering of populations most affected by malnutrition. The virus has further added pressure and issues to food supply chains. Restrictions of contact and supply chain disruption has caused more difficulty to the important challenge of feeding African urban populations. And yet other challenges land on top of those caused by the global pandemic. The agricultural sector, and all those who work within it, are faced by many obstacles, one of which comes in the form of an ever-evolving urban demand for varied food produce. to adapt and work far harder than they have done previously. If they cannot provide the produce which is demanded of their industry, buyers turn to alternative sources of such foods such as imports. In response to this, African governments have attempted to increase an inclusivity of growth through rural agriculture investment. But intertwined with the explosion of populations within Africa, many obstacles have arisen to make the implementation of government plans difficult to pull off.
THE CHALLENGES POSED First to address the elephant in the room. COVID-19 has destabilised the global norm for almost every industry. In Africa, national and local governments are struggling with efficiency, safety, and protection for urban food supplies and vulnerable close-knit city populations. During the lockdown (and continuing restrictions) business closures led to a large rise in job losses as well as restrictions on a multitude of trades. These COVID-19 effects resulted in a greater proportion of low-income workers suffering disproportionally compared to the rest of the population. The consequence – a reduction of pur-
plants. This reality squeezes rural workers between the increased competition to sell their produce, but additionally the low (or existing) rate of pay for what they yield. This leads to agricultural workers maximising their individual input for little more than what they earned prior. Altogether, these challenges mean that the growth and demand for farmer yield does not equate to the low growth of individual farmers’ wages. This itself leads to more migration from the rural based populace to urban areas in search of a better livelihood, consequently causing a greater level of over-population, unemployment, and for the collective nations overall, an economy that is underserved by agriculture.
INCLUSIVITY
“Farmers must find ways to intensify food production in the face of increasing land pressure and rising wage rates,” AASR states. “They must simultaneously diversify production to meet shifting demand for high-value perishables such as poultry, dairy, livestock, and horticultural products. “In the face of mounting food imports from overseas, African farmers, traders, and wholesalers must find ways to drive down domestic costs of production, storage, and distribution in order to remain competitive with external suppliers in Brazil, North America, Europe, and Asia.” The demands for produce such as processed foods means that the primary force behind food production is also shifting away from rural farmers to city-based factories and processing
With growing urban populations, produce demand, and migration away from rural locations, the governments of many African nations are investing in the agricultural industry and mass individual rural workers. Raising the financial and living prospects of these workers will lower or even reverse the pattern of the staggering urban population shift seen over the course of the past few decades. Meanwhile, it will provide more people with the desired livelihood in rural areas (consequently attracting more people back from urban areas to those of rural) – the cut back of unemployment will sufficiently raise the continental economy, and still allow for progressive the urban development necessary in the world today. This kind of plan will increase the general inclusivity of growth among African people (urban and rural), allowing a greater level of fair and proportionate earning among them, leading to better welfare and living standards across the board. Africa Outlook issue 88 | 19
MINING INDABA VIRTUAL 2021
MINING INDABA VIRTUAL 2021 In a celebration of the African mining sector, Mining Indaba returns for 2021 in a virtual format to bring together visionaries and innovators from across the country Written by: Sean Galea-Pace
M
ining Indaba is the world’s largest mining investment event, with a long, distinguished history in Africa’s business calendar and a truly global audience from Australia and South Asia to Europe and North America. It attracts junior, mid-tier and major mining companies, investors, the largest gathering of Mining Ministers in Africa and usually a President or two. From industry giants to tomorrow’s barrier-breaking disruptors, everyone who is anyone attends Mining Indaba to connect and learn. Tom Quinn is Head of Content, Investing in African Mining Indaba. He 20 | Africa Outlook issue 88
believes that against the backdrop of one of the most challenging years ever, the organisers of Mining Indaba recognise and value the role it plays in connecting people, sharing information and moving the industry forward for the year ahead. However, he does admit that holding a virtual event is no substitution for a return to a more traditional setting. “We share the feelings of our customers in that we cannot wait for the return of face-to-face networking,” he explains. “However, demand from the Mining Indaba community to regroup has been overwhelming, throughout this uncertainty, we have been able to
connect the industry more regularly, sharing topical industry insights. Our virtual event will not be “just another webinar” but will embody high production values to support the premium level of industry speakers and government leaders. “Our audience has huge brand loyalty because they know they get a premium event experience. This includes engaging content, thought
EVENT FOCUS
leadership, unrivalled networking and meeting opportunities, and for many mining operators and juniors, the unique opportunity to meet with a high number of investors in one place.” This year’s event will merge the public and private sector together to debate challenges and opportunities around ESG, supply chain transparency and international cooperation that will allow mining
activity to prosper and succeed. Mining Indaba Virtual will aim to tackle and cover topics including using mining to reboot national economies, embracing ESG in the boardroom, ESG investing in a COVID-recovery world, resilience, responsible sourcing of African minerals, the energy transition and the rise of gold in the pandemic.
MINING INDABA VIRTUAL 2021 “I BELIEVE THE INDUSTRY’S RESPONSE TO THE PANDEMIC HAS BEEN POSITIVE AND HAS RANGED FROM SUPPLYING COMMUNITIES WITH PPE AND VENTILATORS TO SETTING UP FIELD HOSPITALS IN REMOTE REGIONS AND GUARANTEEING WAGES IN UNCERTAIN TIMES” – TOM QUINN, HEAD OF CONTENT, MINING INDABA With the event now in its 27th year and CPD certified, it is an unmissable opportunity to hear from industry experts and government leaders counting towards continuing professional development. The content sessions are free to attend, so everyone can access the pioneering insights and multi-stakeholder discussions normally reserved for paying delegates. “We’re honoured to announce
that we will have not one but four Heads of State. These are: H.E. Cyril Ramaphosa, President of South Africa, H.E. Mokgweetsi Masisi, President of Botswana, H.E. Julius Maada Bio, President of Sierra Leone and H.E. Félix Tshisekedi, President of the Democratic Republic of the Congo, as well as South African Minister of Mineral Resources & Energy, Hon. Gwede Mantashe,” says Quinn. “These Heads of State will also join CEOs
from across the value chain including Mark Cutifani, Chief Executive, Anglo American, Bold Bataar, CEO Energy & Minerals, Rio Tinto, Mxolisi Mgojo, CEO, Exxaro Resources, Fortune Mojapelo, CEO, Bushveld Minerals, Alfred Baku, Executive Vice President, Gold Fields, Mark M. Buncombe, Group Head of Metals & Mining, Standard Bank, Nicky Black, Director – Social & Economic Development Programme, ICMM and many more!”
EVENT FOCUS
Quinn believes that despite the pandemic, 2020 was still considered a good year for several metals, such as copper and iron ore. “Platinum group metals, gold, silver and rhodium all had some of their best commodities prices for many years,” explains Quinn. “Mining Indaba Virtual will be digging deep into the rise of gold during the pandemic, exploring the changes in gold production and trading and the effect of geopolitical relationships and lower global growth. “I believe the industry’s response to the pandemic has been positive and has ranged from supplying communities with PPE and ventilators to setting up field hospitals in remote regions and guaranteeing wages in uncertain times.” The disruption caused by the COVID-19 pandemic has been felt by industries across the world and mining is certainly no different. In tandem with the pharmaceutical industry, mining has been a key player in
providing PPE equipment, community resources, employment security and critical supply chains to assist communities during the pandemic. Quinn believes it is an opportunity to transform how the mining industry is seen. “The pandemic has presented many challenges, but it has also acted as a catalyst for change within the mining sector,” explains Quinn. “Mining companies have stepped in to support communities in many African countries where the governments didn’t have the resource or ground(2-3 February 2021) and the Virtual level expertise to respond quickly. This Investment Programme (30-31 is a moment to change the perception March 2021) will be no exception. In of how the sector operates, over and the future, we will certainly continue Cityscape view on the clock above the extraction of minerals and with virtual elements to our overall tower and Tyn cathedral metals.” event strategy on the old square Temquo to deliver meaningful interactions for our community Looking to the future, Quinn is keen explatia illec throughout the year, maintaining to embrace a digital approach and adapt to the current conditions of engagement and enhancing the live the world. “We’re proud to deliver a event.” series of highly successful webinars and online content,” he explains. To register for free, click here! “The upcoming Mining Indaba Virtual Africa Outlook issue 88 | 23
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RENDEAVOUR | MOTUS AFRICA
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DIGISTICS Enabling South Africa’s world-class supply chains
GREEN RESOURCES Sustainable and peoplecentric forestry business
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LAFARGE CANADA
ASteward of the
Community
Issue 01
ATRADIUS TRADE CREDIT INSURANCE
A sustainable, innovative, and people-centric approach to construction
Pioneering trade credit insurance in America
SAINT JAMES HOSPITAL GROUP Innovation and adaption through COVID-19
Manufacturing South Africa Johan Steyn, Managing Director at Aerosud, discusses his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide
STANDING SIDE-BY-SIDE WITH SLOVENIA
Siam City Cement Public Company Limited (SCCC or INSEE) continues to show strength and compassion for its local communities despite the challenges presented by the COVID-19 pandemic
SAVIOLA HOLDING & COMPOSAD
A true pioneer of the circular economy
As the oil and gas industry recovers from the effects of the coronavirus pandemic, we report on an innovative new route for Exmar Offshore
Mining Indaba Virtual 2021 In a celebration of the African mining sector, Mining Indaba returns for 2021 in a virtual format
Nadya Krisko of Honeywell Aerospace explains why COVID-19 has seen the private jet increase in popularity
Richard Browning, the man inside the ‘Iron Man’ suit, tells us the story behind monetising the idea into Gravity Industries
Against the backdrop of the global pandemic, we preview Hellmann Worldwide Logistics’ COVID-19 handbook
mining sector, Mining Indaba returns for 2021 in a virtual format Mining Indaba Virtual 2021 In a celebration of the African
COVID-19 has seen the private jet increase in popularity Nadya Krisko of Honeywell Aerospace explains why
the story behind monetising the idea into Gravity Industries Richard Browning, the man inside the ‘Iron Man’ suit, tells us
Hellmann Worldwide Logistics’ COVID-19 handbook Against the backdrop of the global pandemic, we preview
of the largest aerospace firms worldwide organisation’s position as the manufacturer of choice for some Johan Steyn, Managing Director at Aerosud, discusses his
South Africa Manufacturing
SLOVENIA WITH SIDE-BY-SIDE STANDING
by the COVID-19 pandemic communities despite the challenges presented continues to show strength and compassion for its local Siam City Cement Public Company Limited (SCCC or INSEE)
on an innovative new route for Exmar Offshore effects of the coronavirus pandemic, we report As the oil and gas industry recovers from the
circular economy A true pioneer of the
Tell us your story, Community and we’ll tell the world. COMPOSAD HOLDING & SAVIOLA
through COVID-19 Innovation and adaption
HOSPITAL GROUP SAINT JAMES
centric forestry business Sustainable and people-
RESOURCES GREEN
world-class supply chains Enabling South Africa’s
DIGISTICS
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ASteward of the
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construction approach to people-centric innovative, and A sustainable,
CANADA LAFARGE
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Africa Outlook, APAC Outlook, EME Outlook and North America Outlook are digital and print publications aimed at boardroom and hands-on decision-makers, reaching an audience of more than 800,000 people around the world; spanning the full range of industrial sectors. RENDEAVOUR | MOTUS AFRICA
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With original and exclusive content compiled by our experienced editorial team, we look to promote the latest in engaging news, industry trends and success stories from across the globe. Your company can join the leading industry heavyweights enjoying the free exposure we provide across both digital and print platforms with a free marketing brochure, extensive social media saturation, enhanced B2B networking opportunities, and a readymade forum to attract new investment and to help you grow your business. Visit www.outlookpublishing.com/work-with-us for details on how your company can feature for free in one of our upcoming editions.
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insurance in America Pioneering trade credit
INSURANCE TRADE CREDIT ATRADIUS Issue 01
INDUSTRY SPOTLIGHTS Welcome to our series of spotlights. These reports dive into specific segments of economies across the region, featuring exclusive insight from associations and organisations in the know.
Uganda Manufacturers Association
INDUSTRY SPOTLIGHT
UGANDA’S
MANUFACTURING SECTOR Uganda’s manufacturing sector might have its challenges, but there are many public and private stakeholders intent on helping develop it Writer: Dani Redd | Project Manager: Krisha Canlas
D
uring the 1990s and early 2000s, Uganda made the transition from a predominantly agricultural to increasingly industrialised country, and was praised for its economic policies of government divesture, privatization and currency reform. With the return of political stability to the country, foreign companies and lending institutions began investing in the manufacturing sector, in businesses such as cement factories, drinks manufacturing plants and textiles and steel mills. However, agriculture is still the largest contributor to the country’s GDP. Uganda’s manufacturing industries are primarily based on processing these
26 | Africa Outlook issue 88
agricultural products including tea, tobacco, sugar, coffee, cotton, dairy products and more. Other goods produced in the country include fertiliser, beer, matches, shoes, steel and textiles.
Challenges in the sector Undeniably, Uganda’s manufacturing sector faces many challenges, not least the slowdown of production and subsequent loss of income brought about by COVID-19. More long-term challenges include high costs of infrastructure – especially electricity – limited availability of technical and
UGANDA MANUFACTURING ASSOCIATION
FACTS & FIGURES UGANDA’S MANUFACTURING SECTOR Sub-sectors: agro-processing, food and beverages, construction materials, consumer goods Largest sub-sector: agro-processing (60 percent) Percentage of GDP: 8.3 Manufacturing GDP (USD): 1.4 billion (Jan 2020) Percentage of exports: 19 Percentage of tax revenue collected: 14
managerial skills, as well as difficulty in accessing affordable long-term finance. While Uganda’s government has focused upon creating a stable macroeconomic environment for manufacturers, it has yet to fully determine these priorities. Improving the sector is further inhibited by limited financial resources. For example, Uganda Investment Authority – mandated to attract and facilitate foreign and domestic investment – and the Uganda Free Zones Authority, in charge of regulating investments in the free zones, both have limited resources for promotion activities.
Despite its limited resources, the Ugandan government is invested in helping the manufacturing sector expand and develop, while private sector organisation Uganda Manufacturers Association represents the interests of private stakeholders. The BUBU policy – ‘Buy Uganda Build Uganda’ – was approved in 2014. It is a policy aiming to promote locally manufactured goods and services, as well as providing capacity building programmes to the sector. The BUBU Expo is a well-attended annual events that seeks to encourage networking and coordination around the BUBU policy. It is hoped that the improvement in quality and promotion of local goods will help reduce the country’s import bill. The international development organisation, SET (Supporting Economic Transformation) believes that there are other opportunities to promote investment in the manufacturing sector. It believes any potential programmes must be aligned along four main themes: improving infrastructure for manufacturing; developing a strategic and targeted approach to investment promotion; supporting manufacturing firms’ access to finance; and building the capacity of the private sector, specifically SMEs.
I N TIRNOTDR U OC DTUICOTNI O N
Suggestions for improvement
Africa Outlook issue 88 | 27
Busoga Forestry Company Busoga Forestry Company (BFC) Ltd is a subsidiary of Green Resources AS (GRAS), one of East Africa’s largest Forestation Company and a leader in East African wood processing. GRAS owns 35,000ha of standing forest in Mozambique, Tanzania and Uganda, established through its own planting activities. BFC was established on 14 March 1996 with registration number 31967, and Uganda Investment Authority License number ASD/254/42101. It is a fully paid-up member of the Uganda Timber Growers Association, the Uganda Manufacturers’ Association and is rated as a top 500 tax payer with Uganda Revenue Authority. BFC holds two 50-year renewable tree planting licenses to establish and manage forest plantations on 6,466ha in Bukaleba Central Forest Reserve (CFR), Mayuge district on the shores of Lake Victoria and 2,669ha in Kachung CFR, Dokolo district, North of Lake Kyoga. Over 700 people from the neighbouring villages are employed to provide labour for silviculture, harvesting, sawmilling and timber treatment amongst others. BFC uses wood from FSC certified plantations to sustainably produce high quality value-added timber products based on the needs of its customers. BFC aims at becoming an attractive alternative for investors who are otherwise reluctant to invest in emerging markets and are a favoured partner for development organizations.
Who We Are Our Vision To establish east africa’s leading forest industry company working for the benefit of our stakeholders, employees and the communities where we operate. Our Values • To establish and maintain fast growing and highyielding forests as effectively as possible • Provide first-class products and services to our customers • Adhere to high environmental and social standards • Appreciate employee performance; • Contribute to sustainable rural development for local communities Certification BFCs Values and Mission are partly achieved through the Company’s commitment to manage its plantation and industrial operations in line with international standards and certifications. Certification is a voluntary process that was adopted for implementation and use by BFC as a tool aimed at providing assurance to our stakeholders that our wood products are from sustainably managed forests. To this end, BFC follows the highest national and international corporate, social & environmental standards including certification by the Forest Stewardship CouncilTM standard, the world’s leading standard for responsible forest management.
Key Facts • Established 1996 • 9,135 hectares of Plantation • FSC Certified Plantations • FSC Certified Wood Products • Pole Treatment Plant at Masese • Modern Sawmill & Kilns
Products and Services BFC has established responsibly managed forest plantations which grow trees to generate carbon credits and bioenergy as well as raw materials for the manufacture of quality wood products. The company has to date planted 6,724ha including 4,725ha in Bukaleba, Mayuge district and 1,992ha in Kachung, Dokolo district. The species planted include Pines, Eucalyptus as well as indigenous species like Terminalia species, Maesopsis eminii (Musizi) and Khaya anthoceca (Mahogany species).
4,979ha Planted with Pine
1,552ha Planted with Eucalyptus
We operate a timber treatment plant that produces utility poles for power distribution lines, telecom poles and fencing posts, and structural timber. The poles are pressure-treated using environmentally friendly Copper Chrome Arsenate (CCA) preservative. The poles are professionally treated to ensure the de-sired chemical retention by the wood. Our Poles are utilised primarily within the local market and export markets are pursued whenever it is opportune. BFC operates a state-of-the-art Wood-mizer sawmill with a total production capacity of 80 m3 per day or 18,000 m3 per annum. The modern sawmill ensures the availability of sufficient stocks of wet-off-saw and kiln dried timber to service our demanding local and export clientele as required. Kiln dried timber is produced using German made high temperature kilns and associated computer-controlled moisture removal processes.
Through the production of sustainable wood products, our forests provide important economic and ecological assistance in the control of the ever increasing pressure on Uganda’s natural forests and the associated environmental challenges of climate change, land degradation, water pollution and loss of bio-diversity. BFC seeks to ensure that its activities are environmentally sustainable, and believes its activities continue to have a significantly positive environmental impact.
245ha Temporary Unplanted Areas
1,254ha Conservation Areas
Off-cuts, and other mill waste is chipped and along with sawdust and shavings is sold as biofuel and chicken litter to the local market. BFC has a well-established tree seedlings nursery at Bukaleba with a production capacity of 4,000,000 tree seedlings per annum. The nursery is SPGS (Saw log Production Grant Scheme) certified for quality seedlings production. A variety of tree seedlings are produced including P Caribaea (Pine), Pine hybrids, and hybrid Eucalyptus (GxU) cttings) BFC has pallet making plant at Massese with a production capacity of up to 20,000 pallets a year. The Pallets are made from FSCTM certified timber and are customized according to client needs and specifications.
Busoga Forestry Company PO Box 1900 9B Kyagwe Avenue Jinja, Uganda
bfc@greenresources.no
Africa Outlook issue 88 | 29
INDUSTRY SPOTLIGHT
A S S O C I AT I O N
Interview: Uganda Manufacturers Association The UMA has a membership of over 1,300 companies from a wide range of sectors ranging from agribusiness to electronics, food & beverage to pharmaceuticals. Africa Outlook interviewed Daniel Birungi, the Executive Director of Uganda Manufacturers Association, to find out more.
Daniel Birungi Executive Director of Uganda Manufacturers Association
U
ganda Manufacturers Association was established in the 1960’s, and revived in 1988 Dr James Mulwana. Its vision: to be the most valued and respected business association worldwide, serving the interests of its members, shaping national and regional policies and leading the industrial sector towards sustainable global competitiveness. Today, Uganda Manufacturers Association has a membership of over 1,300 companies from a wide range of sectors ranging from agribusiness to electronics, food & beverage to pharmaceuticals, and many more. Africa Outlook interviewed Daniel Birungi, the Executive Director of Uganda Manufacturers Association, to find out more about it. Africa Outlook (AO): Since inception, how has UMA developed and progressed in terms of its key objectives and the messages it tries to get across? Daniel Birungi (DB): Today Uganda Manufacturers Association is a premium association nationally
30 | Africa Outlook issue 88
and regionally, enjoying recognition and respect internationally. It is also a self-sustaining business association with a voice that is respected by all major stake holders in the region. Uganda Manufacturers Association is the largest organization representing the broad industrial and commercial sector of Uganda’s economy with a membership comprising of corporate, large medium and small firms from the private sectors. We have achieved major milestones achieved through extensive policy and advocacy engagements with government, civil society and other development partners. For example, UMA advocated for The East Africa Common External Tariffs (EAC CET), a four-band structure of 0 percent for raw materials, 10 percent for primary intermediate, 25 percent for finished products not available locals and 35 percent for locally/regionally available finishes products. This tariff structure created a level playing field between the manufacturers and traders, since the import differential (0) for raw materials vs 35 for final products available in the region) encouraged local production at relatively lower costs. UMA is also continuously working with Ministry of Trade Industry and Cooperatives (MTIC) and the Public Procurement and Disposal of Public Assets Authority (PPDA) to increase the sectors on PPDA’s reservation scheme to promote locally made products. For the longest time UMA has been lobbying for an investment regime that also appreciates existing
ASSOCIATION OF GHANA INDUSTRIES
investments, and the need for standardisation of incentives for all investors to create a transparent and level playing field. The Investment Code Act of 2019 has since provided for the establishment of a one stop investment facilitation centre to coordinate all public sector related issues on investment. This has invaluably reduced the cost of doing business and UMA is continuously following up with the Minister for Investment on the full operationalisation of the One Stop Border Point. As a result of UMA’s advocacy, the power tariff has reduced for the textile sector, improving production. Finally, UMA was nominated to be part of the Government of Uganda’s contingent in the negotiations for the all-important African Continental Free Trade Area. It has participated in over 15 negotiations and ensured those manufacturers’ interests are protected. AO: What do you find most exciting about the manufacturing industry in Uganda? DB: The manufacturing industry is a key engine of growth in Uganda because there are usually very strong linkages and spill-over effects associated with manufacturing activities. In Uganda, the sector consumes a staggering 66.7 percent of all the power generated, it contributes 8.3 percent of the GDP, 19 percent of the total exports to the global market and 14 percent of the tax revenue collected. Manufacturing plays a crucial role in economic growth and development, reflected in its contribution to GDP and overall development. This will only grow over the next five years given a steady recovery from COVID-19. The multiplier effect of
manufacturing is exciting – every dollar of output in a sector generates a certain level of economic activity across society and job creation. No sector does more to generate broad-scale economic growth and, ultimately, higher living standards than manufacturing. Many players in the sector are investing more in research and development, leading to the creation of better, new and affordable products for Ugandans. We can now be free from reliance on imports. This not only creates income for the companies involved but taxes to the government, employment to Ugandans and development of the economy. This will set the country free from the high import bill. AO: On the flip side, what are its biggest challenges? DB: Although the sector has undoubtedly gone through leaps of development over the last three decades, it has the potential to do better but needs to be supported. Today, on average, industries run at about 53 percent of their installed capacity. This is attributed to a number of challenges the sector is faced with that includes: the high cost of doing business especially the uncompetitive electricity tariff; intermittent power fluctuations which disrupt production patterns; high interest rates (around 25 percent per annum); and market access challenges with bottlenecks instituted as non-Tariff Barriers within the EAC partner states and infrastructure to link the country’s natural markets. Another challenge is delays in value-added tax refunds. UMA members have continually been affected by the tax body’s consistent failure to Africa Outlook issue 88 | 31
INDUSTRY SPOTLIGHT
promptly refund VAT. This locks up and deprives manufacturers of working capital. The VAT law also clearly stipulates and requires URA to pay a 25 percent interest on any delayed refunds, but this has also not been done. This is worsened by the dynamic tax regime.
A S S O C I AT I O N
AO: What is UMA doing to help make the manufacturing industry in Uganda more sustainable? DB: In a bid to promote the Buy Uganda Build Uganda (BUBU) policy, UMA engages government to promote local purchases for both foreign and locally awarded contracts. Uganda is a low developing country, which means that there are still very many opportunities from which manufacturers can immensely benefit and operate at a higher capacity. UMA has a registered training section that provides an array of courses to member companies. These courses are aimed at capacity-building, equipping company staff with relevant soft and hard skills. UMA looks forward to partnerships across the region with Associations like KAM, COMESA, and many more to ensure exchange programmes across the region for more and advanced training. UMA runs various networking and promotional events, including the International Trade Fair, which attracts 586 companies from within the country and over 400 companies internationally. UMA is currently implementing projects in skills development, energy Audits, Value-chain developments and assessments. However, due to the limited funding from development partners, only 200 companies have benefited from these initiatives. At the secretariat, we provide market advisory services to individual member companies that either seek to invest, expand or seek investment advice. With our readily available policy and advocacy team, many companies have appreciated this development. UMA is engaging with different partners to ensure the exponential growth of this service for more companies to benefit from such services. To promote input-output developments and inter-sectoral engagements, UMA organises networking development events for the various subsectors within manufacturing. These also spill over to other sectors like finance, services and agriculture. The association aims to create an integrated economy hinged on manufacturing. UMA has been able to achieve regional recognition and therefore has had multiple engagements with
32 | Africa Outlook issue 88
EAC for input on the development agenda. At the UMA, we ensure that any development involving the manufacturing sector at EAC level is attended to effectively. AO: How has COVID-19 affected the manufacturing industry in Uganda? DB: We are still recovering from production shocks caused by supply chain disruptions, limited access to materials, repayment of loans with no production, shifting production patterns due to disruption of workplans for factory work, cost of transporting staff and safety measures undertaken by staff, and above all, a reduction in the addressable market for manufactured products. There has been easing of a number of movement restrictions although the curfew limitations mean that operations at factories are still adjusting to the new normal. Since most countries still have restrictions at the borders, there have been delivery delays of externally sourced raw materials and machinery. Given that most companies in Uganda import their raw materials in the form of semi-finished goods, production stage inputs or even capital goods that aid production, UMA undertook a study to understand how production was affected as a result of the COVID-19 safety measures. 46 percent of the respondents stated that production in their businesses was scaled down by 50 percent or more, 27 percent scaled production down by 25 percent, while 25 percent stopped production altogether. On a lighter note, UMA is amazed at the resilience witnessed in the manufacturing sector over the course of 2020, despite the severe disruptions occasioned by COVID-19 and the attendant economic slowdown. It is this resilience and laser focus on building up better that has further energised us to champion member requirements. We want to ensure that they receive the requisite support to not only survive the period but also to identify the silver linings within the cloud cast by the current situation. AO: How do you see the manufacturing industry in Uganda developing over the next five years? DB: With the implementation of most of the proposed policy agendas including, among others: tax administration recommendation, manufacturing incentivisation, export promotion, import substitution, power costs and related
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issues, government local purchases and public-private partnerships on government development agenda, we as manufacturers predict a 10 percent growth of the sector and an increase from 21 percent to over 25 percent contribution to GDP over the five years. We are excited about the movement of the country from the export of raw non-processed commodities to agro-processed (for agriculture) and other manufactured products. With the many energy projects being concluded in the next five years, the manufacturing sector is set to reap big rewards for such development since it will not only improve access to stable power but reduce operational costs.
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Africa Outlook issue 88 | 33
INDUSTRY SPOTLIGHT
In Focus: the Agro-Processing Sector
BUSINESS I N INSIGHT FOCUS
Uganda has a predominantly agricultural economy, thanks to its fertile soils and year-round sunny climate
AC C O R D I N G to the World Bank, the agricultural sector accounts for 54 percent of the country’s export earnings. Meanwhile, agro-processing (the treatment and processing of agricultural materials into saleable commodities) comprises around 60 percent of the manufacturing sector’s output. Between 2012 to 2017, the food processing subsector increased at an average annual rate of eight percent, with the strongest growth registered in the processing of meat, fish and dairy, as well as edible oils and bakery processing. A growing middle class in the country is leading to a change in diet, with more people looking to buy high quality, processed products. The agro-processing sector is important to Uganda for several key reasons. The first is that developing small- and medium- scale agro-industrial firms will lead to an expansion in job opportunities. The second is that agro-processing will help Uganda move away from exporting low-value raw commodities and diversify its export offering, both of which will facilitate economic growth within the country. The Ugandan government’s development agenda prioritises agro-led industrialisation as an important pillar of economic prosperity. It will take
an area-based commodity approach – in other words, it will focus on developing and processing the commodities grown in defined agro-industrial zones. A key feature of the plan involves “nucleus farms” – spaces which aggregate high volumes of raw material provided by surrounding smallholders – which has had proven success, Uganda’s Kalangala Oil Palm scheme being one example. However, according to a report by the International Growth Centre, there is a potential problem. “There appears to be a high degree of confusion and mis-co-ordination among government institutions over the crop, fish and livestock value chains on which the new agro-industrialisation strategy is to be based, having the potential to severely hamper a co-ordinated agroindustrialisation push,” the report reads. In short, different government agencies and institutions are prioritising different value chains, with little information available on why different commodities have been selected. It states that there is an urgent need for improved agricultural statistics, allowing public and private stakeholders to improve policies and interventions in the agro-processing sector.
More Ugandans are looking to buy high quality, processed food products 34 | Africa Outlook issue 88
UGANDA MANUFACTURING ASSOCIATION
Key Players The companies shaping and disrupting the manufacturing sector in Uganda
BUSOGA FORESTRY COMPANY LTD
CHEMIPHAR
Busoga Forestry Company Ltd (BFC) has a mission: to become Africa’s premier forestry, carbon offsetting and wood products company for the benefit of the planet and its stakeholders. It is a subsidiary of Green Resources AS (GRAS), Africa’s leading forestry company, which owns 40,000 hectares of forest in Mozambique, Tanzania and Africa, established through its own planting activities. BFC was established in 1996 and has established forestry plantations in Bukaleba and Kachung Central Forest Reserves, and the districts of Mayuge and Dokolo. It uses plantation wood to produce high-value added products for its customers. It does so by following the highest corporate, social and environmental standards.
Chemiphar is a private laboratory offering a wide range of test services, alongside inspections and hygiene monitoring.
RENA BEVERAGE SOLUTIONS LTD RENA Beverage Solutions produces organic beverages such as hibiscus tea, juices and wines.
MABALE GROWERS TEA FACTORY LTD Mabale Growers Tea Factory is Uganda’s leading tea manufacturer.
Africa Outlook issue 88 | 35
Tell us your story and we’ll tell the world. AFRICA OUTLOOK is a digital and print product aimed at boardroom and hands-on decision-makers across a wide range of industries on the continent. With content compiled by our experienced editorial team, complemented by an in-house design and production team ensuring delivery to the highest standards, we look to promote the latest in engaging news, industry trends and success stories from the length and breadth of Africa. We reach an audience of 185,000 people across the continent, bridging the full range of industrial sectors: agriculture, construction, energy & utilities, finance, food & drink, healthcare, manufacturing, mining & resources, oil & gas, retail, shipping & logistics, technology and travel & tourism. In joining the leading industry heavyweights already enjoying the exposure we can provide, you can benefit from FREE coverage across both digital and print platforms, a FREE marketing brochure, extensive social media saturation, enhanced B2B networking opportunities, and a readymade forum to attract new investment and to grow your business. To get involved, please contact Outlook Publishing’s Managing Director, Ben Weaver, who can provide further details on how to feature your company, for FREE, in one of our upcoming editions.
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Issue 88
DIGISTICS Enabling South Africa’s world-class supply chains
GREEN RESOURCES Sustainable and peoplecentric forestry business
Manufacturing South Africa Johan Steyn, Managing Director at Aerosud, discusses his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide
Manufacturing South Africa Johan Steyn, Managing Director at Aerosud, discusses his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide Writer: Sean Galea-Pace | Project Manager: Thomas Turnbull
2 | Africa Outlook issue 88
AN INTERNATIONALLY RECOGNISED SUPPLIER OF AIRCRAFT INTERIOR SYSTEMS In a country of extreme diversity and a history of innovation, we have no shortage of talent – which is also reflected by the average age of workers being 35 years-old.” That is the belief of Johan Steyn, Managing Director at Aerosud. The South African aerospace
industry is active and vibrant, and demonstrates a significant history of aerospace innovation, research, development, and manufacturing. The industry was already manufacturing full aircraft during the late 1920s and has turned that early step and many subsequent innovations into long-term and sustainable partnerships with a
range of the world’s leading aerospace original equipment manufacturers. Steyn recognises the plethora of talent that fills South Africa. “Opportunities in South Africa is the issue – years of decline in Aerospace and Defence spending and the demise of SOE’s has eroded the capacity of the network in general,” explains Steyn. Africa Outlook issue 88 | 3
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AEROSUD
Manufacturing South Africa Johan Steyn, Managing Director at Aerosud, discusses his organisation’s position as the manufacturer of choice for some of the largest aerospace firms worldwide Writer: Sean Galea-Pace | Project Manager: Thomas Turnbull
38 | Africa Outlook issue 88
MANUFACTURING
In a country of extreme diversity and a history of innovation, we have no shortage of talent – which is also reflected by the average age of workers being 35 years-old.” That is the belief of Johan Steyn, Managing Director at Aerosud. The South African aerospace
industry is active and vibrant, and demonstrates a significant history of aerospace innovation, research, development, and manufacturing. The industry was already manufacturing full aircraft during the late 1920s and has turned that early step and many subsequent innovations into long-term and sustainable partnerships with a
range of the world’s leading aerospace original equipment manufacturers. Steyn recognises the plethora of talent that fills South Africa. “Opportunities in South Africa is the issue – years of decline in Aerospace and Defence spending and the demise of SOE’s has eroded the capacity of the network in general,” explains Steyn. Africa Outlook issue 88 | 39
AEROSUD
SPECIFIC OUTCOMES FOR THE AEROSPACE MANUFACTURING SECTOR: • Doubling manufactured exports over a period of five years. • Localisation of imports of materials and components. • Growing sector employment by 60 percent in high-tech jobs. • Leveraging and deploying the advanced manufacturing skills. • Transformation of the sector including ownership, skills and supplier. Development with particular emphasis on black industrialisation. • Driving the industrialization and commercial deployment of leading-edge technologies. • Establishing a best-practice advanced manufacturing hub by applying advanced manufacturing best practices. • Promote direct partnerships with international OEM’s and/ or technology partners, to demonstrate and showcase local industry capabilities and capacities to collaborate. • Forging stronger ties with the global aviation manufacturing.
40 | Africa Outlook issue 88
“Training of young talent is critical – and we have first-hand experience of the benefits of doing that – especially in terms of artisan training.” Founded in 1990 as a high-end aeronautical engineering and project-focused company, Steyn’s organisation was initially a defencerelated application that subsequently began to diversify into commercial applications. During the late 1990s, Aerosud began to break into the refurbishing market for airline interiors. Today, Aerosud stands as the largest privately owned commercial aviation manufacturer and exporter in South Africa and is a globally established supplier of aircraft interior systems. The company is directly involved in Industry 4.0 technology applications and collaborations, which has now expanded into a new business offering to other advances manufacturing sectors within the South African industry. Having initially joined the organisation in 1991 as a Senior Structural Systems Engineer, Steyn became Managing Director of Aerosud in 2007. “I’m proud of what Aerosud stands for and what we have achieved over the years, through the introduction of leading technologies in manufacturing and integrated business systems,” says Steyn. “I am equally excited about the future and especially the rise and acceptance of Industry 4.0 solutions in the sector.” Steyn believes that through its business philosophy of ‘Theory of Constraints’, Aerosud can guarantee better quality, cost and delivery performance than most traditional suppliers of similar size. “Our wide-ranging capabilities is a unique offering – often referred as the Swiss army knife,” he says. “Deep rooted engineering capability also allows Aerosud to industrialise new products and processes in an independent manner – without significant oversight by the customer/OEM. South Africa is well positioned as a ‘best cost’
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Africa Outlook issue 88 | 41
AEROSUD
A GLOBALLY RECOGNISED SUPPLIER Over the years, Aerosud has gained numerous real-life skills and experience across a range of business functions and systems in the innovative and competitive world of aerospace design and manufacturing. The organisation has become an internationally renowned supplier to some of the largest aircraft manufacturers globally. Some of its major projects throughout the years include: 1990-1995 – Aerosud was appointed the main contractor to develop a solution for the life extension of the South African Air Force Mirage F1 fleet, using the Klimov RD-33 engine. Although technically very challenging, the project was completed successfully and two prototypes were extensively flight tested in South Africa. 2007-2012 – Aerosud became a ‘Design and Build partner’ on the Airbus A400 development project. The organisation was contracted for the development of six work packages with Airbus France, Germany and UK. This programme resulted in the development of interesting technical solutions, but also meant digital and collaborative design solutions along with several Airbus approvals for several products and engineering services.
42 | Africa Outlook issue 88
country with language and cultural compatibility with all major OEMs.” Alongside his role at Aerosud, Steyn is also Chairman of the Board of CAMASA (Commercial Aerospace Manufacturing Association of South Africa). Formed in 2016 as a non-profit organisation that strives to promote a bi-lateral growth strategy between private industry and government in South Africa, CAMASA’s vision is aimed at doubling the aerospace manufacturing turnover in five years, focused primarily on exports. In order to streamline processes and increase efficiency, manufacturers around the world are embracing digital transformation and introducing new technology into operations. In the case of Aerosud, the company has introduced a highly specialised welding robot process on A320 and A350 products driven by cost, critical skills, and volumes to be produced. “Digital business processes and integrated business system is very
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important,” says Steyn. “It has to expand into the supply chain, internal operations and manufacturing – and very often it is mandated by the customer – to be able to integrate engineering data and business processes like PLM. “Of course, it’s definitely important to implement 4IR strategies – but only if it makes sense and adds productivity to your company offering – never do it because everybody else is doing it!” The aerospace manufacturing sector is dominated by OEM and regulatory requirements and regulations. This consists of a large supply chain of over 300 international suppliers of raw materials and parts, often with single source suppliers. “We have 10 suppliers that consists of 80 percent of the spend – but even the smallest parts are important to complete a product to the customer specifications,” says Steyn. “Logistics integration and door-to-door tracking and reporting is critically important.”
Perhaps the industry most impacted by COVID-19 has been the aviation space. With flights grounded and air cargo significantly reduced, Steyn admits that the impact on firms such as Aerosud was ‘unavoidable.’ The pandemic only accelerated the adoption of new technology across the board to not just ensure business continuity but to also achieve considerable growth. “The global impact from COVID19 began with logistics disruptions, followed by the South African lockdown and dramatic rate adjustments,” he explains. “Aerosud has embarked on a strategy to diversify and develop by offering a number of digital product solutions throughout the last two years. The crisis has highlighted the need to expand and accelerate such offerings, such as MWORX which is a digital business platform for SME applications.” Looking to the future, Steyn is
optimistic about the next couple of years and stresses the importance of having a positive mindset following a challenging year. “We’re working hard to maintain current business which will require further investment by all suppliers to the OEMs,” says Steyn. “We all work hard to stay relevant in three to five years with expanded offerings and most likely with further diversification to avoid/mitigate the events of 2020. “Aerosud aims to diversify into automotive, medical and nuclear for manufacturing. We plan to expand our digital offering and business solutions for SMEs.”
AEROSUD Tel: +27 (0) 12 662 5000 info@aerosud.co.za www.aerosud.co.za
Africa Outlook issue 88 | 43
NEW WAY POWER
Backing up SA’s
Supply In a country struggling with an unreliable electricity grid, New Way Power provides reliable backup with its diesel generator solutions Writer: Dani Redd | Project Manager: Tom Turnbull
44 | Africa Outlook issue 88
A
round 1.5 billion people across the globe live with “broken” or unstable electricity grids, meaning they experience power blackouts for hundreds, sometimes thousands of hours a year. Vital services – such as hospitals – are also plugged into the same grids and remaining operational is critical. There is, then, a fundamental need for
back-up power solutions. Diesel generators are one of the most popular options in developing countries. In Sub-Saharan Africa, generators provide nine percent of electricity consumed annually; in Western Africa, it rises to 40 percent. New Way Power is a South African company that provides this vital service. Established in 1983, it initially
MANUFACTURING
sold and supported diesel engines. “But then a clear crisis started to appear in the state-owned infrastructure in terms of power supply and access to the grid in about 2008, where the infrastructure showed serious stress,” Dane Viljoen, Chief Commercial Officer, explains. “New Way Power could see it happening a year or two in advance.
It was a natural transition from diesel engines to manufacturing and assembling diesel generators, with the largest component being the engine.” Comprehensive power solutions In 2006, then, New Way branched out to begin designing power solutions around diesel generators. By 2010 it had been acquired by the ENX Group. Today, it boasts a 33,000
square metre production facility in Johannesburg, with sales and aftersales support branches in the main hubs, Durban and Cape Town. New Way comprises of three business units and two separate legal entities. The first is New Way Power, which designs, manufacturers, delivers and installs generators – this constitutes between 65 to 75 Africa Outlook issue 88 | 45
NEW WAY POWER
John Deere John Deere Power Systems is a trusted partner for generator set OEMs worldwide, offering bare engines and power units for a wide range of applications. Counting many leading generator-set manufacturers amongst its OEM customers, John Deere Power Systems has a unique insight into the market and its demands. As an entirely independent engine manufacturer of diesel driven power generation engines, JDPS offers OEMs unbiased engine expertise and is known for its ultra-reliable and low maintenance engines, and focuses on providing quick-starting, cleanrunning and fuel-efficient generator set power, which leads to a low overall cost of ownership. JDPS offers a complete power range that meets most worldwide emissions regulations, from non-emissions certified engines to EU Stage V (Europe) and EPA Final Tier 4 (North America) and the range covers all recognized power nodes from 30 to 500 kVA with displacements of 2.9L through 13.6L.
percent of its business offering. There is a division within the company, Genmatics, which is a temporary power company, offering both shortand long-term rentals, predominantly operating within the events industry. This normally makes up around 15 percent of revenue. “Obviously with COVID and the shutting down of all events, we’ve had to look elsewhere,” Viljoen says. The third business entity is Power 02, which focuses in on the selling and distribution of diesel engines such as John Deere G Drive, Moteurs Baudouin and Mitsubishi, and comprises 10 percent of revenue. “Obviously, New Way Power is one of Power 02’s larger internal customers,” the CCO explains. “New Way Power promotes those same brands. When we build a generator, we will use Moteurs Baudouin, John Deere 46 | Africa Outlook issue 88
or Mitsubishi. If a customer specifies another brand, we will endeavour to accommodate them, but our strongest focus is to push our brands.” The company has a strong footing in South Africa and employs around 180 staff nationwide. Its largest client base comes from the data centre space, followed by the retail sector, facilities management, property, healthcare and agriculture. “Throughout COVID, the data industry is one of the few that has been thriving – everyone needs to be online, be virtual, so data is a big thing at the moment,” Viljoen says. “In that space, there has been massive growth that is set to continue for some time. It is lucky for us to be in that space, although you have to be quite flexible, and adapt as you go along. Project management is hugely important, as is the ability to execute projects timeously.”
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LEADERSHIP FOCUS
DANE VILJOEN Dane Viljoen, New Way’s Chief Commercial Officer, has been working in the generator industry for the past 15 years. He initially joined the company Generator Logic during South Africa’s electricity infrastructure crisis, which soon spread to neighbouring countries. “The challenge was that the demand for the BTS towers became massive; Generator Logic’s order book grew massive and they couldn’t keep up with the demand,” he explains. “My introduction to the industry was through the production line. It was my job to increase production and capacity in the factory to meet demand. They were producing 60 to 70 generators per month but needed to get that number up to 300 within six months.” Viljoen stayed with Generator Logic for eight years, progressing up through the company to become its General Manager. In 2012, the Austro Group (later ENX) wanted to acquire Generator Logic. Although the acquisition didn’t materialise, it introduced him to New Way, whom he joined in 2013 as Chief Operating Officer, with a remit to increase efficiencies and throughput in the factory. “After four and a half years I increased my portfolio by working in sales. By mid-2018 they changed my title to Commercial Officer because it became more sales focussed, rather than operational. In late 2019 the previous CEO moved on and I’m now running the company,” the CCO explains.
New Way Power recently entered into a supply agreement with one of the largest data centres in South Africa; a project spread over Gauteng, Western Cape and Kwazulu Natal. It has, so far, powered five or six energy centres in those three regions. “It has been a learning curve,” the CCO confesses. “Within the data space there is a big push on advancing technologically year on year, improving cost efficiencies on the power back up supply. Their business model is constantly innovating and changing and so we have to follow suit. It’s been a huge project for us. “There are only one or two other players in South Africa that would be able to design and build these generators and integrate them with some of the other onsite infrastructures, such as diesel retriculation systems, BMS systems. It’s quite a complex design 48 | Africa Outlook issue 88
philosophy, which is where New Way’s strength comes in. It’s not just putting the generator together, it’s making sure the design is fit for purpose, based on the customer’s continually advancing requirements.” Despite its data centre contracts, like many companies New Way was affected by the pandemic. The supply chain was heavily disrupted, which in turn affected lead times and suppliers’ capacities. New Way Power spent six weeks in complete shutdown, despite being considered an essential back up supplier to critical services. Viljoen enumerates the operational difficulties. “Equipment sales were few and far between, our manufacturing facility was shut. The ability to sell equipment was hampered, your debtors book keeps growing, your customers have an issue paying their accounts,” he says.
This is a time when strong partner and supplier relationships are vital to a company’s survival, and New Way is no exception. “You have to have discussions with your suppliers, lots of cooperation is needed, everyone just trying to help each other out through this time. It became clear how important partnerships are – some of our most vital support structure came from the supplier side,” the CCO explains. While Viljoen freely admits that the economic fallout of the pandemic was nothing short of disastrous, it has brought his team closer together. “You didn’t know what would happen from one day to the next; you would try and prepare for the worst and it would change or get even worse. That was just so difficult to plan,” he says. “But one positive of the new wave was that the team really
MANUFACTURING
Established October 21, 2016, Mondium is an EPC joint venture that was formed by two key Australian mining players, Monadelphous and Lycopodium. An independent company, Mondium brings together the comp Africa Outlook issue 88 | 49
NEW WAY POWER
50 | Africa Outlook issue 88
MANUFACTURING
Established October 21, 2016, Mondium is an EPC joint venture that was formed by two key Australian mining players, Monadelphous and Lycopodium. An independent together the comp
showed their commitment, and where their strengths lie.”
PLANNING FOR RECOVERY Viljoen, like many of us, hopes that we have got through the worst of the pandemic and is looking forward to economic recovery over the upcoming year. Thanks to the pandemic, New Way has set “conservative” revenue targets. It intends to focus strongly on marketing, having set up an internal team for the first time, and will be focusing on strengthening capacity through promotion and sales. A second focus is diversification. New Way is currently exploring using gas engines to power their generators,
which are better for the environment than its diesel counterparts. “Just this week the team and I had a meeting with Moteurs Baudouin to discuss their new range of gas-powered engines, and the kw range between 50 kw and 1,400 kw standalone,” the CCO explains. “Watch this space – there are lots of opportunities, especially in some African regions where gas is readily available.” New Way Power is interested in expanding into renewables more, predominantly as a preferred partner for solar integrators, as it is a competitive space to navigate. “The one thing I do need to add is that I do not think that the African
continent and customer base will be able to get away from diesel generators for quite some time to come,” the CCO says. “Even when you incorporate elements of renewables – such as a diesel/solar hybrid solution, you are always going to need that diesel generator as a reliable backup.” And there’s nobody more reliable than New Way when it comes to back up power solutions.
Tel: (+27) 10 216-2600 contact@newway.co.za www.newway.co.za
Africa Outlook issue 88 | 51
ARJO
Delivering Safety and Efficiency to African Healthcare With change at the fore of the region’s healthcare industry, Arjo is seeking expansion, the company looking to build on its solid base in South Africa Writer: Sean Galea-Pace | Project Manager: Callam Waller
The African healthcare industry is a very exciting space but riddled with challenges,” says Abdullah Ebrahim, Managing Director of Arjo Africa. And he should know. With over a decade of experience in the healthcare industry and now in his second spell with the organisation after a brief intermission, Ebrahim has watched first-hand as the African industry transformed over the years. “Africa is an emerging space and this means there are lots of opportunities for growth and improvement as well as space to bring more solutions that focus on improving mobility outcomes to the market,” he says. 52 | Africa Outlook issue 88
Ebrahim is an experienced industry professional who is responsible for identifying, developing and overseeing the implementation of business strategy at Arjo. His passion for the industry and Africa is evident. “I’m proud to do work that contributes to improving the lives of people affected with mobility and healthcare challenges and raising the standards of healthcare on the African continent,” he adds. Arjo offers a range of solutions that helps meet the new and evolving healthcare challenges. Its Africa office is headquartered in Pretoria, South Africa, and employs around 100 people across the continent. The company’s
HEALTHCARE
Africa Outlook issue 88 | 53
ARJO overall aim is to help harness a safer and more efficient healthcare environment. For over 60 years, Arjo has worked closely with healthcare professionals, providing a unique understanding for everyday challenges. Its products and solutions ensure ergonomic patient
positioning with medical beds, safe patient handling, hygiene, disinfection, and the effective prevention of pressure injuries and venous thromboembolism – and help professionals across care environments to provide good, safe and dignified care.
THE ARJO PORTFOLIO MEDICAL BEDS: a range of hospital and long-term healthcare beds that allow for good infection control, enhanced ergonomics, comfort, safety and ease of use as well as promoting effective risk management. SAFE PATIENT HANDLING: for patients and residents with limited or impaired mobility, time spent out of bed could be a specific rehabilitation goal or the highlight of their day. PRESSURE INJURY PREVENTION: an in-depth portfolio created to manage resident and patient outcomes by helping to prevent and manage the complications associated with immobility. VTE PREVENTION: while healthcare facilities are aware of the risk of VTE, care providers don’t always have the time, training or resources to introduce optimal prevention strategies. Through the Arjo Flowtron Active Compression System, professional caregivers can provide safe, convenient and flexible VTE prevention therapy which allows for better compliance and optimal clinical efficacy. HYGIENE: its hygiene solutions are created to facilitate efficient and secure hygiene care and wellness routines while helping to decrease workload for caregivers. DISINFECTION: flusher disinfectors and flusher liquids to support your infection control strategy.
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Ebrahim believes that its investments have been stable as Arjo gradually scales its operations in South Africa. “Arjo has invested steadily in building up the Africa business,” explains Ebrahim. “In line with our strong global reach, we have built a strong presence across the African continent and have a strong base in South Africa that services the African continent and have specifically placed in country resources in Egypt and Nigeria as these two are major economic hubs that show great growth potential. We help to create a safer and more efficient healthcare environment by providing high-quality, dependable products that assist the healthcare professional in their daily duties, whilst ensuring maximum patient dignity and comfort.” Over the years, the organisation has partnered with the South African Public Healthcare Sector, as well as many of the private and independent hospital groups in South Africa like MediClinic, LifeHealth Care, Netcare, Clinix & Lenmed. Ebrahim believes that having a strong presence within South Africa allows Arjo to enhance its offering through value-added services such as educational programmes and assessment services. “In the rest of Africa, through our strong distributor networks we have been successful in securing business with local turnkey project partners in Egypt, Libya, Nigeria, Kenya, Namibia and Botswana,” he explains. “With dedicated sales and marketing resources now focused on localised campaigns within the African region, our footprint is ever growing. Training and knowledge of our employees is vital. Through the Arjo Academy, we ensure that the Arjo representatives our customers depend on for support always have updated knowledge and skillsets to help in the daily use of its equipment.” “Healthcare professionals need to be up to date with the latest products
HEALTHCARE
Africa Outlook issue 88 | 55
ARJO
ONGOING PROJECTS Arjo continues to invest in countries such as Egypt, Nigeria and Kenya to build local expertise to drive the value-added services that build strong partnerships with our customers. Venous Thromboembolism (VTE) is a serious condition that causes death and disability worldwide, with 10 million cases each year. In order to safeguard the well-being of at-risk patients, comprehensive VTE prevention strategies that take into account individual clinical needs are essential. As a result, Arjo is launching several VTE Prevention and treatment campaigns within Africa. Arjo has invested in resources to support the growth of the long-term care segment during the last two years. It maintains a 2030 vision is to become the mobility outcomes partner of choice.
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and best practices to ensure the best care is given to their patients or residents,” he adds. “The COVID-19 pandemic threw a spanner in the works as our representatives could no longer gain access to hospitals and care facilities to conduct training. Through global webinars and interaction platforms with key opinion leaders in the industry, our customers are able to keep up to date with relevant training and information sessions weekly.” Despite the disruption caused by COVID-19, Arjo quickly developed organisational plans in a bid to keep its employees safe and operations running as smoothly as possible.
HEALTHCARE
“PEOPLE ARE OUR BIGGEST ASSETS AND THEREFORE WE CONTINUE TO INVEST IN THEM AND DRIVE THEIR PROFESSIONAL AND PERSONAL PROGRESS” – ABDULLAH EBRAHIM, MANAGING DIRECTOR OF ARJO AFRICA
“The COVID-19 pandemic has increased the demand for our products such as medical beds as many facilities around the continent had to scale capacity in order to service the demand,” says Ebrahim. “Taking into account the necessary precautions in keeping our employees and customers safe we have moved several of our value-add services such as the education component to a more online-based solution.” However, as a result of its robust partner relationships, Arjo could successfully meet that heightened demand of its customers despite the pandemic. Ebrahim affirms that close collaboration was essential in order to mitigate disruptions. “Although like many organisations, capacity and logistics challenges had a significant impact on operations, we have such strong relationships with our partners that we could minimise these effects and pass on benefits to our customers,” he adds. One of Arjo’s most important principles is to grow people and the organisation together. According to Ebrahim, people are at the heart of what Arjo does. “We drive the growth and development of our employees by investing in training and education both internally and externally,” explains Ebrahim.
“People are our biggest assets and therefore we continue to invest in them and drive their professional and personal progress. We also have continuous engagement platforms which allows us to constantly monitor the pulse of our people.” With the future in mind, Ebrahim has a clear idea of the next steps for his organisation, which prompts him to spell out his vision for the coming period as the conversation draws to a close. “Over the next year we will have a specific focus on diversifying our presence in the long-term care segment,” he notes. “We can specifically offer value to this segment through our tailored solutions offering and raising the level of care provided in these facilities. In terms of the markets outside of South Africa, our ambition is to continue to invest in these markets to build local presence as well as strengthen the partnership with our customers in these countries.”
ARJO Tel: +27 12 527 2000 Arjo.Africa@Arjo.com www.arjo.com
Africa Outlook issue 88 | 57
MOTUS AFRICA
SUPPLY CHAIN
AFRICAN
Automotive Adaptation Of the many promising sectors active in Africa, automotive manufacturing stands out as a progressive sphere of industry with growing potential Writer: Marcus Kääpä | Project Manager: Lewis Bush
E
ast Africa is home to a substantial percentage of the continent’s shipping, logistics, and supply chain sectors. Amid the sectors, despite the turmoil in the wake of the 2020 coronavirus pandemic, East African automotive manufacturing stands as one industry that is both competitive and promising. “There is a lot of opportunity in East African countries. Although recently impacted by COVID-19, these countries have high levels of GDP growth, and have young, growing populations,” begins Tim Jaques, CEO of Motus Africa. “There is a strong desire by people to develop and progress in this region which makes investing and working in these countries very rewarding.” Within the region, the automotive market has established itself as a dynamic and competitive sector and has undergone various changes throughout recent years.
“Dealerships have been subjected to fluctuating market cycles. Each market has its own specific dynamics, but there is a general upturn expected over the next few years in the new car market.” Jaques started in the automotive industry over 22 years ago. His career path has seen him hold various positions in multiple different automotive companies, and he has overseen sub-Saharan African and Indian Ocean regions for the majority of this time. Within Motus Holdings (Motus) he has held the position of Motus Africa CEO since 2014. Motus Africa a division within the South African listed Motus Holdings, operates as the parent company of multiple East African distributors and dealerships, with presences in Kenya, Tanzania, Malawi, and Zambia. Motus Africa’s network of owned and independent dealerships has a vast geographical reach operating in each of these countries.
Africa Outlook issue 88 | 59
MOTUS AFRICA
MOTUS HOLDINGS (MOTUS): A CLOSER LOOK Motus is South Africa’s leading automotive group, employing over 17,500 people. It is a diversified (non-manufacturing) business in the automotive sector with unrivalled scale and scope in South Africa, a selected international presence primarily in the United Kingdom and Australia, as well as a limited presence in South East Asia, and Southern and East Africa. Motus traces its roots back to 1948, when its founding company Imperial Holdings Limited started as a single motor dealership in downtown Johannesburg. Motus was listed on the Johannesburg Stock Exchange in November 2018, following its
“We sell motor vehicles as well as provide after sales services and spare parts. We currently represent leading vehicle brands such as Nissan and Mitsubishi, and tyre brand Michelin in selected markets,” Jaques tells us. “We have customers across all market sectors and given the robust and reliable nature of the products and quality services that we sell, are able to assist our customer base over a vast geographical region.”
FUTURE OF THE INDUSTRY Motus exists within an ever fluctuating and competitive market. The organisation strives to stay above this competition by adapting to the varying needs of its customer base, and by maintaining its customercentric approach. “Motus Africa is a process driven, yet adaptable and flexible organisation that strives for excellence,” Jaques affirms. “We have been market leaders in 60 | Africa Outlook issue 88
unbundling from Imperial Holdings Limited. Motus offers a differentiated value proposition to Original Equipment Manufacturers, customers and business partners with a fully integrated business model across the automotive value chain through four key business segments namely: Import and Distribution, Retail and Rental, Financial Services and Aftermarket Parts. Motus has long-standing importer and retail partnerships with leading Original Equipment Manufacturers, representing some of the world’s most recognisable brands. We provide automotive manufacturers with a highly effective route-tomarket and a vital link between the brand and the customer throughout the vehicle ownership cycle.
East Africa in customer service and in addition to various innovations, were the first Group to offer two year, 50,000 kilometres free service plans across the entire vehicle range in all of our East African markets.” Of course, the COVID-19 pandemic and its consequential effects across various industries has not left the East African automotive manufacturing unscathed. However, this period has allowed Motus Africa to show its ability as an enabler in the industry with regards to responsibility, safety, and workplace adaptation. Since the inception of the pandemic period, Motus Africa has fully supported the governments of the countries in which it operates. It had reduced all non-essential operations in line with governmentimposed restrictions and guidelines, and limited unnecessary contact through the shift to digital working for those who were practically able.
In addition, we provide motorrelated financial services and the sale of accessories and aftermarket parts for out-of-warranty vehicles.
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Africa Outlook issue 88 | 61
MOTUS AFRICA
“OUR MARKET SHARE IS STRONG ACROSS THE REGION. WE AIM TO ACHIEVE HIGHER LEVELS FOR THE BRANDS THAT WE REPRESENT, AND TO CONTINUE TO BE LEADERS IN AFTER-SALES SERVICE”
COMPANY VALUES, VISION AND MISSIONS VALUES: To be fair, accountable, driven and ensure that we operate in an environmentally friendly and responsible manner. This includes complying with rules and regulations, dealing at the highest levels of integrity and ethics, and ensuring business practices are non-discriminatory. VISION: To improve people’s lives by envisioning, innovating and creating new avenues of access to leading-edge mobility solutions (products and services) at competitive prices through our strong relationships with suppliers and principals, while ensuring sustainable value creation for all stakeholders, as trusted partners to original equipment manufacturers (OEMs) and business partners to customers in the geographies in which we operate. MISSION: We create value for customers and build market share through relevant, innovative products and exceptional service at competitive prices. We deliver returns to shareholders through operational alignment, collaboration across the supply chain, and the reduction of complexity, duplication, expenses and capital employed, while mitigating currency risk. Our progress and performance are delivered by a diverse complement of highly competent and experienced individuals and teams.
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“Our first priority is the health and safety of our people, our customers and all our stakeholders, including our extended value chain,” Jaques continues. “We are proactively monitoring the guidance from health authorities and have well developed business continuity plans in place for dealing with such events. We believe we have the teams, the resources, and the experience to navigate through this difficult time.” And with a vaccine announced with a 95 percent success rate, industries across the board are warming to the idea that things may be returning to relative pre-pandemic normality. The company’s Kenyan branch is one that represents a great deal of potential for the future of Motus in light of the prospect of a COVID-free industry. In addition to its existing Kenyan operations, the prospects of the Kenyan market can be further reached through the company’s new dealership branch in Kisumu – the largest city in
SUPPLY CHAIN
western Kenya, and an important inland port on Lake Victoria. This area is a valuable trade route linking Lake Victoria to Mombasa and Nairobi. “By investing in Kisumu, we are ensuring that we are able to offer our customers the very best products and services countrywide,” Jaques explains. “We are also creating jobs and opportunities in the city. Although many companies have reduced their investment over this difficult period, Motus Africa has a long-term strategy and believes in investing for a sustainable and relevant business within the communities in which we operate. Through our various training and development programs, our employees are enabled with improved skills and empowerment. This has a positive knock on effect in the communities where we operate and
benefits the broader public.” To aid its operations, Motus maintains key supply chain partnerships that ensure the company can achieve the level of service and success it is known for. A prime example of this is the importance of working alongside entities in the East African logistics industry – businesses that have the know-how to navigate the often-complex environments in which Motus works. With 2021 underway, this year presents opportunities and growth prospects - Jaques ends on an optimistic note. “Our market share is strong across the region. We aim to achieve higher levels for the brands that we represent, and to continue to be leaders in aftersales service. We aim to continue to develop our people and offer more opportunities within the region.”
MOTUS AFRICA Tel: +27 (0)10 493 4335 information@motuscorp.co.za www.motus.co.za
Africa Outlook issue 88 | 63
DIGISTICS SOUTH AFRICA
64 | Africa Outlook issue 88
SUPPLY CHAIN Driven by four key pillars – technology, reliability, adaptability, sustainability – Digistics has consistently set new standards in South African logistics for a quarter century
Excellence in Motion
Project Manager: Lewis Bush
F
or centuries, logistics has been the heartbeat of global societies and industries; the backbone of trade and commerce. The term originally stems from Ancient Rome, the empire having developed sophisticated logistics systems to keep its different global legions supplied. Logistikas – a type of Roman military officer – were tasked with allocating resources and maintaining supply lines so that its armies could continue to reach new corners of Europe, the Middle East, Asia and indeed Africa. These supply lines primarily relied upon the Roman empire’s infamous chariots. But today, logistics systems look a little different. The horse and cart have been replaced by trucks that now shift eight billion tonnes of goods a year. Freight ships the length of four football pitches shuttle cargo across our seas. Thousands of planes take the skies each month to transport goods tens of thousands of miles around the world. And the tech helping to power the global supply chain industry has advanced too. Temperature controlled logistics, for example, has been crucial in the storage, preservation and transportation of sensitive cargo. In warmer climates, such technology has been game changing – something that South African firm Digistics is well aware of. Founded in 1995 when ASP Distributors and Spar partnered up Africa Outlook issue 88 | 65
DIGISTICS SOUTH AFRICA to launch in Africa’s southernmost country, the enterprise pioneered multi-temperature distribution within the South African quick service restaurant (QSR) industry. The firm took on its current name – Digistics (Pty) Ltd. – in 2003 following a management buyout, later selling a majority stake to Super Group Holdings in 2012 which bought the entire company as a subsidiary in 2017. Today, Digistics has 795 employees, 198 vehicles, and operates seven distributions centres in Cape Town, Durban, Port Elizabeth, Pretoria, Bloemfontein and Johannesburg, each critical to the success of the QSR industry in these national hubs.
RELIABILITY, ADAPTABILITY, SUSTAINABILITY An open embrace of technology is a key differentiator for Digistics – it is a trend running through the company’s entire operation. Its warehouses are constantly updating and innovating in order to optimise procedures; the latest navigation systems are deployed to
KEY SERVICES Digistics focuses on every aspect of supply chain management in order to both maximise and unleash hidden value at every stage of the logistics journey. Its key priorities include: - Product sourcing - Fulfilment - Warehousing - Delivery - Relationship management - Financial modelling - Inventory management - Reporting
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keep customers informed; centralised management systems enable alignment across teams and maintain customer-centric execution. However, technology is not Digistics’ only unique selling point. “Why us?”, the company asks on its website, pointing to reliability, adaptability and sustainability as the three remaining pillars of its quadrilateral ethos. The former of this trio is about delivering what is required when is needed, reducing delivery times, keeping customers informed and exceeding expectations. Adaptability refers to the company’s flexibility to react to both change and emergencies: planning around no-go zones, collecting orders when suppliers cannot deliver, and having deliveries ready to go within the hour. “Failure is not an option for our customers, and it’s not an option for us,” the company states. Sustainability, meanwhile, is about investing in the future today. To this end, Digistics has reduced its greenhouse gas emissions, optimised trailer designs, reconsidered warehouse locations and continues to constantly analyse its entire network in order to deliver in a sustainable, ethical and responsible manner.
A BUSINESS THAT LOOKS BEYOND PROFIT These latter three points translate directly into the company’s corporate social responsibility practices, Digistics committed to supporting the South African communities in which it operates. Some of its practices on this front include providing skilled jobs understanding and appreciating the importance of family, and offering opportunities to those who present themselves as ambassadors at a local level. “We believe we have a unique role to play in feeding a nation, and we therefore support various charities, as
DH Lifts (Pty) Ltd Opening our 1st branch in Meadowdale Johannesburg in April 2018, DH Lifts have grown at an exponential rate. In October 2019, both Durban and Cape Town branches opened, assisting in increasing our national footprint, followed by the opening of our Port Elizabeth branch in April 2020. Partnering with Dhollandia, the leading Tail lift manufacturer in the world, producing more than 80 000 lifts per year with 5 production facilities in Europe, gives us the edge above our competitors to supply a superior brand of hydraulic tail lifts. Our strong service & supply network with more than 18 accredited agents in South Africa plus neighbouring countries, gives our customers peace of mind to purchase our brand. Herewith 8 good reasons why to buy Dhollandia: 1. Safe & Reliable 2. Flexible & Customer orientated 3. Superior Finish 4. Economic & budget friendly 5. Easy installation 6. Strong Environmental focus 7. Unrivalled international customer support 8. The Safe & Clever Buy One of DH Lifts key focus areas is expanding the Dhollandia brand accompanied by a full-service package to ensure our customers vehicles are well maintained, increasing longevity of the tail lift and decreasing downtime. We offer a 24-hour national breakdown service and hassle-free warranty assistance. Whilst Dhollandia is our key focus and brand, we can offer service and maintenance/repairs on other competitor brands. For more information for sales or service, please visit our website below or call us on 010 880 2194
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DIGISTICS SOUTH AFRICA
ONE COMPANY, SIX VALUES
well as our customers’ charities,” the company highlights on its website. Extensive training programmes are also a primary concern, the firm recognising the multi-faceted benefits road safety can have on both ensuring the protection of people, longevity of its own assets and engagement of employees.
PROUDLY SERVING QSR STALWARTS Digistics customer-centric attitudes have ensured it works with and continues to deliver value for some of the world’s leading QSR companies. These include, but are not limited to: - McDonald’s - Pizza Hut - Hungry Lion - KFC - Burger King - Popeyes - Maxi’s - OB - King Pie - Viva e Caffè - Engen - Corner Bakery - The Fish & Chip Co
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Regarding the latter, its employees are seen as more than just workers. Digistics refers to them as “our people”, recognising them to be the heart and soul of the organisation. The company explains: “In order to do what we do, we need leaders to build a best-in-class customerfocused business. We do have those leaders on our team. You will find leadership at every level, and each employee in our team of more than 795 makes decisions every day to put our customers’ businesses first. “Our executive team is committed to delivering customer results with a balanced focus across customers, people, processes, and financial performance. We understand the unique requirements and dynamics of our customers and that is why our leadership empowers the business to adapt to customers’ unique requirements and enable our customer’s strategy.” Indeed, an acceptance of key values among its people, from innovative thinking and relationship building to customer care and the importance of safety, is paramount to the South African freight specialist, more so now than ever. Owing to the changes brought about by the novel coronavirus, from billions staying at home, interrupted global trade corridors and new societal norms, the logistics industry – like any others – is faced with the necessity to not only adapt, but also transform. Despite the challenges, Digistics has remained committed to, in the company’s own words, “delivering on our promise – even now”.
EXECUTION: Valuing diligent and disciplined process execution with a sense of urgency, remaining accountable for meeting expectations. ACT AS ONE: Working together and giving clear direction on common goals. CHANGE: Valuing change as a constant that requires innovative thinking, flexibility, cuttingedge technology, a continuous improvement culture and willingness to take risks. RELATIONSHIPS: Building lasting relationships with employees, customers, suppliers and communities based on mutual respect, trust and integrity. CARING PERSONALLY: Understanding and respecting each other in order to help each other succeed. SAFETY AND WELLNESS: Valuing the health and safety of employees, customers, suppliers and communities.
It states: “We stand behind South Africa and the world as we face uncertain times amid the coronavirus outbreak, but we’ll keep moving, in compliance with health and safety regulations and keep excellence in motion, all the way.” Indeed, a company depicted by innovation, collaboration and openness, Digistics is primed to succeed in the face of both new opportunities and challenges that may present themselves in 2021 and beyond, pandemic-related or otherwise.
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Africa Outlook issue 88 | 69
A.G. LEVENTIS NIGERIA
Strength Through Supply Chain The supply chain and logistics industry is the key to connect trade and commerce, and equally for effective e-commerce services. We spoke to Seun Oni, Group MD and CEO of A.G. Leventis Nigeria, about the company’s endurance in the face of the pandemic, and its innovative developments in the sector Writer: Marcus Kääpä | Project Manager: Lewis Bush Looking back, I definitely see how the dots all connected to lead me to this point,” says Seun Oni, from A.G. Leventis Nigeria. “My domain field is in finance, professionally a Chartered Accountant, and I started my career after graduating schooling with PwC. Over the past 29 years, my career has evolved through key career milestones that have defined the essence of my leadership.” Now Oni sits as Group Managing Director and CEO of the company; A.G. Leventis (Nigeria) Ltd (AGL). AGL began as a trading business in Ghana in 1937. It has developed and transformed into a Conglomerate, with a major portion of its operations 70 | Africa Outlook issue 88
in supply chain and logistics, covering multiple aspects of the industry, from logistic solutions to truck assembly, and automobile sales. Other areas of the business are real estate, and retail. Prior to the start of the decade, the Nigerian logistics industry saw a surge of revenue leading up to 2020. However, it was one of the many sectors to be hit hard by the impact of the COVID-19 pandemic that followed. “Over the past decade, the industry experienced some moderate level of growth before the 2020 crisis. The industry was one of the fastest growth sectors of the economy. In 2018, the value was estimated at ₦250 billion ($694 million),” Oni elaborates. “But against the backdrop of an emerging recession, just after the last recession cycle of 2014-16, this is currently a challenging period for the sector.” “The industry can still be regarded as at a nascent stage. Its full potential is constrained by infrastructure challenges, the highly fragmented nature of the industry with over 500 players, enabling institutions are marred by high level bureaucracy, policy inconsistencies, and slow pace of much needed institutional reforms,” Oni adds.
Nigeria is ranked approximately 110 out of 168 countries in the World Bank Logistics Performance Index, and with the exception of South Africa (at 33), and Ivory Coast (in 50th place), the other African countries are above the 50th mark with a higher index for the West African countries. These challenges however open up a spectrum of opportunities for industry players that choose to leverage unique levers to drive a competitive advantage, despite the need for the acceleration of critical
SUPPLY CHAIN
reforms. The sector, given its role in the facilitation and enabling of business competitiveness, is crucial in the economic transformation, as well as GDP expansion for the country.
STANDING STRONG: COMBATTING COVID It is fair to say that the COVID-19 pandemic changed industries around the world, but AGL rose to the challenge as soon as it presented itself. Faced by the pandemic, AGL decided to act immediately. From the
onset the company saw and prepared for the worst, treating it from the very beginning as an extended crisis. “We kicked in the crisis management team around the first week of March 2020 - immediately after we had the first reported index case. Our focus was directed at our employees, methods of working, client portfolio, and operational business continuity,” Oni informs us. “The shift to take the crisis head-on, early, focusing on what we can control and influence together as a team and
being overcautious, put us quickly in the position of putting together guidance to navigate our operations for remote working and connecting our branch operations across the country.” For the company, the primary focus remains the health (both physically and mentally), safety, and well-being of its employees. This people-centric practice is one of the many factors that set the company apart from its industry competitors. “Building an engagement platform to emotionally connect with the team, Africa Outlook issue 88 | 71
A.G. LEVENTIS NIGERIA being open in sharing real concerns, and integrating seamlessly into the new work norm, will continue to be a priority” Oni says. This people-centric attitude and focus is one of AGL’s key values. It is one of the many aspects that sets it above and apart from its industry competition, including resilience in the face of challenges, the strategic partnerships with OEMs, and the company’s drivers – the heart of AGL. “We take pride in our drivers (our delivery officers); we call them our frontline leaders. We focus on welfare, training, and effectiveness,
recognising that they are the first touchpoint for service experience,” Oni tells us proudly. “The network of our operational sites equally provides a reach that enables us provide immediate support intervention either as rest points on long journeys or for timely resolution of issues, and these are critical building blocks in securing driver wellbeing and effectiveness.” “Our heritage not only reflects a strong identity and connection to the country, but it reflects the power of resilience that has been embedded into our DNA,” she adds.
AT A GLANCE: COMPANY SERVICES Its pride is first in its heritage and long-standing roots in Nigeria and West Africa. A.G. Leventis started out as a trading company in Ghana established in 1937 by the Patriarch of the Leventis family, Chief Anastasios G. Leventis. In the following year 1938 the trading operations extended into Nigeria. The business portfolio has evolved since, and it now currently operate in five core areas, with 1,114 leaders (half are frontline – the Delivery Officers, managing the trucks), and an office is in Lagos with a support network of 18 operational sites. The core areas: 1. LOGISTICS – providing logistics solutions, mainly in haulage and distribution, to companies primarily in the FMCG space. 2. TRUCK ASSEMBLY – truck assembly from semi-knocked down components (SKD) with operating partnerships for the following brands: FOTON, EICHER, and LOVOL. On top of this it carries OEM spares for Volkswagen, and Mercedes Benz trucks. The plant operates out of Ibadan in Oyo State. 3. AUTOMOBILE SALES – heavy and light duty sales with the related after sales support and maintenance. The company operates from 18 maintenance facilities across the country, providing a strong network and reach for its customers, while being a critical enabler for the logistics business.
Eterna Eterna Plc is a trusted and reliable energy partner to A.G Leventis. We supply high performance Lubricants and quality Fuels to her diverse portfolio of companies across Nigeria. This relationship spans several years of providing energy solutions to A.G. Leventis’ different subsidiaries in the – Vehicle assembly & sales, Real Estate, Retail as well as Logistics sectors. We are glad to tread on this trajectory of growth with her in achieving her vision to become a conglomerate of pride with global repute in Africa. At Eterna, we manufacture, market and distribute lubricants and chemicals; trade in crude and operate a network of filling stations. Our plan is to further expand into the midstream and upstream sectors of the energy industry and to become Africa’s preferred energy company. OUR BUSINESS LINES Lubricants Manufacturing & Marketing Our Lubes Blending Plant is located in Sagamu, Ogun State. The Plant occupies a sprawling land mass of almost five hectares along the Lagos /Ibadan Expressway. It is one of only three plants in Africa that manufacture Castrol products. Eterna Plc is the sole licensee for Castrol products in Nigeria. We also manufacture and market the Eterna brand of lubricants. Fuel Stations Our retail presence expansion drive has commenced. We have secured strategic sites and are developing a network of modern fuel stations. We have over 60 retail sites across Nigeria. Petroleum Storage Terminals
4. REAL ESTATE – a mixed use (residential and commercial) portfolio with estimated market value of over ₦35 billion ($89 million), and over 60 properties across the country.
We own and operate a 30 million litre facility for storing petroleum products at the Ibru Jetty, Ibafon, Apapa, Lagos.
5. RETAIL – this is a joint venture with Pick n Pay, South Africa. Pick n Pay is the second largest supermarket chain in South Africa and it will be the operators of the joint venture. The venture will operate under the trade name Pikwik Nigeria Ltd.
Toll Blending We offer Toll Blending services for a select range of lubricants.
www.eternaplc.com
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A.G. LEVENTIS NIGERIA
Strategic partnerships with OEMs of the truck brands gives AGL the upper hand in the market. Through this, the company is able to connect the supply side of the truck components, all through to the local assembly, access to spares and localised maintenance with on-demand support from the manufacturer provided, throughout the life cycle of the trucks.
DIGITALISATION Yet an additional aspect that places AGL beyond the industry competition is its active digitalisation processes that see it adapt to the growing digital age. Oni elaborates. “As a business, we have and continue to navigate the different curveballs that come with the operating environment and we are still very much here. We equally build in agility and ensure we keep pace with innovation – we learn and adapt quickly. “We are proud of our new corporate website: www.agleventis.com, it showcases our history and our brands. 74 | Africa Outlook issue 88
We believe in the power of storytelling, after 83 years and still going strong, we want to see our website constantly evolve but equally dot the paths of our journey in this great continent.” The website showcases the facets of the AGL Tribe (the employees), from the nuts and bolts of its technicians in the workplace, to the diversity across the workplace, and the best of what we do every day to drive execution. “The website is our canvas, and we shall continuously refresh this and make it more interactive in engaging with our customers and visitors to the site,” Oni tells us. “For example, we are currently working on extending the Real Estate site to leverage a lot more interactive technology like virtual tours of our commercial and residential properties, which allows a real-time interface engagement with the users, so watch out as we unveil this.” Alongside the development of its digital platform, AGL invests in innovative technology to maintain its fundamental supply chain operations.
SUPPLY CHAIN
AT A GLANCE: CAREER HISTORY
“TAKING CRITICAL DECISIONS ON THE ELEMENTS OF THE LOGISTICS INFRASTRUCTURE MIX TO LEVERAGE AND EXTEND OUR FOOTPRINT ACROSS THE LOGISTIC VALUE CHAIN”
SEUN ONI After close to eight years with PwC, I joined the Coca-Cola Company in Nigeria, and over the next 14 years I held varied finance related roles both with country and regional focus. I took on an international assignment based out of the UK covering Africa in a Financial Planning role. I equally had the opportunity, as part of my leadership development to take a strategic oversight role as the Executive Assistant to a Regional President and this role in particular, started my very early steps out of my “comfort zone” of finance. After Coca-Cola Nigeria, I transitioned into bottling operations, and joined CocaCola Hellenic Bottling Company (CCHBC), a strategic bottling partner of the Coca-Cola Company. I took on the role as the Country CFO for Nigeria Bottling Company (the Nigerian subsidiary of CCHBC). This role, looking back was one of the pivotal bold moves, as it pitched me right into core operations and the crazy but
A prime example of this is the company’s ERP systems and internal procurement processes. These keep the company’s stock inventory fully updated and allow for the ready availability of spare parts, enabling them to be supplied to a multitude of customers quickly.
THE YEARS AHEAD 2020 was a critical year for AGL. The firm set a clear goal to double its
exhilarating dynamics of business operations and driving and influencing that, from a CFO lens. Taking on these leadership roles in organisations like the Coca-Cola Company, Coca-Cola Hellenic Bottling, and Reckitt Benckiser, prior to moving into an executive leadership role, exposed me to the best of both real-life executions, and high-level thought leadership and principles around supply chain and logistics. It has given me direct insights into the demand side of the industry and executing now from the supply side of providing these services, I pull from the vantage point of these varied experiences.
business with a significant portion of growth fuelled by its logistics business. The external challenges had some impact on this, however, AGL ended the year proud of its trajectory, and able to reset some of the fundamental elements of operation in readiness for 2021 - looking ahead to this year and into the future, AGL’s plans are hinged on expansion. “Our focus in 2021 is still fully in line with our transformation road map,
and it is all about growth, growth and growth!” Oni tells us. “We know that the macro-economic challenges are still prevalent, but we see some key growth levers and our priorities will focus on translating those to value. “For example, technology will continue to be a strong play for us as we step change our current platform especially at the front end. Taking critical decisions on the elements of the logistics infrastructure mix to leverage and extend our footprint across the logistic value chain.” The new norm of continual digitalisation is expected to accelerate e-commerce across all industries, and the backbone of e-commerce is the logistics sector – from providing effective specialised warehouses, to fulfilment centres, and last-mile delivery services. As a company with a foothold in such a key area of growing business, A.G. Leventis is certainly granted with exciting opportunities to come, and very much worth keeping an eye on.
A.G. LEVENTIS NIGERIA Tel: +234 01 4408134 Tel: +234 8000055555 www. agleventis.com
Africa Outlook issue 88 | 75
NAMDOCK
SHIPPING IN AFRICA We examine a leading force in West Africa’s ship repair market, NAMDOCK, and uncover how it is delivering first-class service despite the disruption of COVID-19 Writer: Sean Galea-Pace | Project Manager: Lewis Bush
N
AMDOCK is recognised as a leader in the West African ship repair market, specialising in marine and industrial engineering. Based in the Port of Walvis Bay, NAMDOCK is committed to offering safe, quality, reliable facilities and services, and innovative solutions to its clients. The company strives for delivering with speed and efficiency, and has a track record of consistency and reliability within Africa. NAMDOCK’s stakeholders are fully engaged in the aim of a common goal – boosting its global competitiveness through sustainable organic growth whilst generating more value to all stakeholders involved. The organisation operates a highly efficient shipyard that includes three floating docks with a combined capacity of 30,000 tonnes, seven cranes, 1 x 60T floating crane, with fully equipped onsite workshops.
A BRIEF HISTORY NAMDOCK was founded in 2005 by the Namibian parliament for all drydock repairs and maintenance on large vessels within the Walvis Bay harbour. The business was established to support locals and create jobs while increasing employment across Namibia. It currently operates three dry docks where vessels are parked 76 | Africa Outlook issue 88
and then anchored to receive multiple repairs, from propulsion work through to carpentry. Today, the firm employs 700 staff and subcontracts work to more than 3,000 people at any one time.
NAMDOCK’S HIGHLY SKILLED PROFESSIONALS NAMDOCK employs highly skilled professionals dedicated to the following trades:
• Valves • Rigging • Piping • Coatings • Mechanical • Machining • Fabrication • Carpentry • Electrical • Propulsion
NAMDOCK’S SHAREHOLDERS Namibia Drydock and Ship Repair is a strategic, mutually beneficial partnership between the Nambian government and the private sector, which provides the international shipping and local industry with a full house capacity in all aspects of ship repair.
NAMPORT In a joint collaboration in 2006, NAMPORT, Namibia’s National Port Authority, and NAMDOCK, Namibia
SUPPLY CHAIN
Drydock and Ship Repair, worked together to increase Namibia’s capacity in the ship repair industry. Its primary aim is to intensify ship repair activities that could boost job creation and the economic development of Walvis Bay. As the majority shareholder in Namibia Drydock and Ship Repair, NAMPORT remains aligned with its mission to contribute to the success of its customers through continuous development of its capacities, technical competencies and motivated workplace.
The National Ports Authority of Namibia (NAMPORT) is a key shareholder (52.5 percent) of NAMDOCK. In this role, Namport: • Manages the port facilities to cater for current trade needs. • Develops the ports for future demands. • Contributes to the competitiveness of the SADC’s region’s trade through the efficient, reliable and costeffective supply of port services. • Facilitates economic growth in Namibia by enabling regional
development and cross-border trade. • Promotes the Ports of Walvis Bay and Luderitz as preferred routes for sea-borne trade between SADC, Europe and the Americas. • Assists with developing cross-border trade as the founding architects of the Walvis Bay Corridor Group. • Minimises the impact of port operations on the natural environment by applying International Organisation Standardisation ISO 14001. • Uplifts and support the communities in which it operates. Africa Outlook issue 88 | 77
NAMDOCK EBH CONSORTIUM (EBHC) EBH Consortium purchased 47.5 percent minority shareholding in NAMDOCK from the DCD Group in 2018. The EBH Consortium consists of several captains of industry possessing a framework built on a sound formation of extensive years of knowledge and experience. These capabilities include: • Marine, mining and industrial engineering. • Marine salvaging and waste management. • High-end steel and pipe fabrication work skills on the boiler maintenance and oil and gas industries. • Logistics, agency, and freight clearing and forwarding. • Specialises in the provision of repair, maintenance and operation services, fabrication and installation, upgrades and conversions to the marine, oil and gas, and industrial markets worldwide. • Welding of hull structures, steam boiler, pressure vessel and pipelines. • Naval architecture and new buildings.
Walvis Bay is Namibia’s largest commercial port and has direct access to principal shipping routes while acting as a natural gateway for international trade. Walvis Bay provides sheltered, deep water anchorage enhanced by temperate weather conditions, easy access by road and air, easy visa regime for visitors, and good telecommunications, road, and financial infrastructure. Walvis Bay provides several advantages over other Southern African ports, while being significantly closer to vast West Coast oilfields. Walvis Bay is considered a key part of the Walvis Bay Corridor Group which has made it an ideal port of entry to the leading trade route in southern Africa.
FUTURE GROWTH Namibia Drydock and Ship Repairs maintain a robust competitive advantage, ranging from instant market penetration to the elimination of potential competitors through steady growth. The acquisition
NAMDOCK’S COVID-19 APPROACH Throughout the pandemic, NAMDOCK has operated as a multipurpose business and provided a repair service across the healthcare industry, repairing beds, cupboards, and providing isolation centres for COVID-19 patients. NAMDOCK is investing heavily on supporting the local employment and providing work and training across the maritime sector. There are three projects in operation at any one time, with each project having a two-tothree-week turnaround period. Following the lockdowns and restrictions put in place at the beginning of the COVID-19 pandemic, NAMDOCK resumed full operation in June 2020. The company began to undertake extensive research into recommended COVID-19 mitigation measures and is taking every precaution to ensure the safety of its clients, employees and service providers. The organisation introduced a comprehensive COVID-19 response plan, in tandem with recommendations by the Namibian Ministry of Health and Social Services, and the World Health Organisation (WHO).
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Logistics Support Services Our service offering spectrum includes, however is not limited to Ships Agency and Ships Husbandry Services, International Freight Forwarding, Warehousing, Cargo Services, Project Logistics, and Consultancy. As a one-stop shop, Logistics Support Services (Pty) Ltd can be relied on to take care of any requirements. We are focused on service delivery and we understand how crucial turnaround time is for our clients. We are passionate about delivering excellent and on-time service in the most cost effective and efficient way. By understanding your needs and wants through intelligent analysis of the best methodologies, we provide a customised solution that fits both your financial and delivery needs.
www.lssnamibia.com
and consequent shareholding of shares by EBH Consortium ensures Namibia Drydock and Ship Repairs’ sustainable growth, and adds greater value for the company and its shareholders. Namibia Drydock and Ship Repair has gained access to a new pool of resources which will add value to the company, as well as maximising the realisation of opportunities for further expansion. The value proposition that Namibia Drydock and Ship Repair offers its customers are well aligned with the customer focused culture that its main stakeholders cultivate and drive. Upon investing in research and development, innovation and skills, as well as leveraging its strategic alliances, Namibia Drydock and Ship Repair seeks to solidify its position as the ship repair firm of choice on Africa’s west coast and accelerate its international competitiveness.
SUPPLY CHAIN
Logistics Support Services (Pty) Ltd
LSS_CorporateAD_160x97_CONV_01122020.indd 1
01/12/2020 9:37:32 AM
RITC Namibia
Walvis Bay is the one to call. Established in 2013 with over 25 years’ experience in the marine safety equipment service and supply industry.
Raysonics Inspection Testing & Certication Kelso Park Workshop no. 10 | 12th Street East Industrial | P. O. Box 4551, Walvis Bay, Namibia | ivolene@ritcnam.com | +264 81 124 5307
WE SPECIALIZE IN:
With a core business involving the service of Lifeboats, Davits, Rescue boats and Inflatable boats additional services and products are also offered. SAFETY EQUIPMENT
MARINE SAFETY AND FIRE-FIGHTING
ACR EQUIPMENT
OIL SPILL KITS & EQUIPMENT
Ndt & Class Survey | Offshore NDT & Intransit Surveys | Nuclear & Industrial NDT | Hardness Testing | Vacuum Box Testing | Radiographic Testing | Corrosion Surveys | Project Quality Engineering | Quality Assurance | Third Party Inspections | Welding Inspection | Hydrostatic Pressure Testing of Vessel and Piping Systems Pressure Vessel Design & Certication.
Mr. Jan Bekker | Mob: +264 81 150 1632 | info@marinelifeboat.com Mr. George Bekker | Mob: +264 81 693 2499 | george@marinelifeboat.com
Africa Outlook issue 88 | 79
WORLD COURIER AFRICA
Planning Distribution With Africa’s biopharmaceutical industry growing rapidly, World Courier is helping establish an unmatched network to transport, store and deliver medical products Writer: Dani Redd | Project Manager: Lewis Bush
T
he better something works, the less attention you pay to it. Seamless supply chains form the fabric of our everyday lives, from our online Amazon orders to ‘click and collect’ clothes shopping. But in 2020, coronavirus – and the lockdowns and border closures – simultaneously disrupted supply chains while highlighting the complex logistical systems underpinning them. Logistics firms have come to the forefront again recently, as it is they who will be charged with transporting and storing vital COVID vaccines. “On a global level, as the race to develop safe and effective COVID19 vaccines continues, there are the logistics challenges posed by the distribution of hundreds of millions of doses all around the world,” explains Remo Hanselmann. “Some of the vaccine candidates require temperature-controlled logistics, along with carefully planned distribution and storage strategies. For some regions, including the African
80 | Africa Outlook issue 88
continent, the hurdle becomes even more apparent. This is when relying on a trusted partner such as World Courier will make all the difference,” he adds. Hanselmann is the Managing Director of World Courier South Africa. His remit: to support healthier futures on the continent by growing World Courier’s footprint and to ensure the optimal handling, transport, storage and delivery of healthcare products. World Courier is in capable hands – Hanselmann has over two decades’ experience in aviation, cargo and logistics, having worked for organisations such as Swisscargo and Aer Lingus. Originally from Switzerland, he has been based in South Africa since 2015 (as well as from 2003 to 2007). “Africa is always an exciting space to be working in,” he explains. “There are more than 50 countries across the continent and each of them is in a different stage of its economic development. There’s never a dull moment. Our teams solve challenges on a daily basis.” Africa’s biopharmaceutical industry is one of the fastest growing across the globe. Most countries are in the earliest stages of their development, but the growth potential is immense. Manufacturers and clinical service companies must build robust supply chains to support rapidly increasing requirements.
LOGISTICS & SUPPLY CHAIN
WORLD COURIER AFRICA
FOCUS AREA STAFF EMPOWERMENT REMO HANSELMANN: “At World Courier, our teams share a same drive to develop unsurpassed knowledge in the specialty logistics space, as we transport the products that will shape tomorrow. “Our onboarding and training process is very rigorous in order to reach the level of expertise and quality our customers deserve. This is part of World Courier’s and its parent company, AmerisourceBergen, DNA. This is why we constantly invest in our staff, as they could be the difference between a successful and an unsuccessful shipment. We are united in our responsibility to create healthier futures and our commitment to people, quality and innovation means we deliver career opportunities that few others can match.”
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However, despite the biopharmaceutical industry’s strong potential, the surrounding infrastructure can be fragile, and this raises logistics challenges, such as long import timelines and a lack of trained logistics providers. This is where World Courier comes in. With two decades’ logistics experience in Africa – in 2019 alone it made 18,000 shipments – it is prepared for these challenges and has established a network that will mitigate risk, maximise the return on R&D and ensure the safe and timely delivery of lifesaving medicines. An unmatched network World Courier is a medical logistics company – in Africa it has facilities in South Africa and Kenya, alongside a large network of independent agents, and offers specialty logistics transport and warehouse services. In October 2020, it opened its first transport office in East Africa, located in Nairobi, Kenya. It has been operating in South Africa for just over 20 years, and has established three branches in Durban, Cape Town and Johannesburg, alongside a clinical and commercial third-party logistics provider depot, and around 50 associates. Its sites across Africa are all fully GxP compliant, and located near airports to ensure rapid turnaround. The portfolio of World Courier services is managed by locally trained staff and contacts, while audit and SOP verified compliance is supported by its global network. “We deliver shipments to virtually every country and location in Africa, whether it is through our own team or our independent network of World Courier agents,” the Managing Director says. Agent activities are closely monitored and managed by a dedicated team in Madrid, Spain, which acts as quality control. Hanselmann believes that World Courier differentiates itself from the
Julian’s Logistics “Our Story” Just like our logo that symbolises life, health and honour, our partnership with World Courier resembles a similar relationship that goes all the way back to 2005. Since then we have been fixated with controlling temperatures for the pharmaceutical industry throughout South Africa’s volatile four seasons, hence the birth of Julian’s Logistics CC in 2011. We have since customised insulated vehicles and imported Thermoking refrigerated units to ensure that temperatures do not deviate whilst on route to the pharmacist. In winter, on a single trip we have encountered both hot and cold outside temperatures which we were able to heat up and cool down, to maintain the desired Load temperatures. Independent Certified Temperature Probes used on every trip confirms that we have never been out of range with any controlled pharmaceutical Delivery. Servicing Africa through one of its busiest ports of entry, OR Tambo International Airport, we are looking forward to doing our bit to making sure that the pharmaceutical industry, help save lives for a long time to come.
competition thanks to its unmatched global network. “Whatever their location, our associates are customer solutions specialists who receive more than ten weeks of initial training. We hold ourselves to a higher standard because our customers deserve nothing less and we always ensure quality beyond compliance, for every shipment,” he explains. World Courier works closely with its partners and suppliers to ensure continuity of supply. Hanselmann cites one of the organisation’s key achievements as the local production of a packaging solutions range in South Africa. This resulted in lower production and transfer costs for its network, alongside enhancing local manufacturing. Hanselmann believes that another of World Courier’s differentiating factors comes from its state-of-theart, innovative packaging solutions to secure the cold chain.
LOGISTICS & SUPPLY CHAIN
Why compromise? We control temperatures for the Pharmaceutical Industry. Temperature controlled vehicle hire
Specialised shipments/ equipment consultants
Road freight
Backup/electric stand-by refrigerators
Keeping the heart beat in pharmaceuticals
Email: julian@julianslogistics.com Cell/Whatsapp: +27(0)829274687 Landline : 011 3935426 Website: julianslogistics.com
Africa Outlook issue 88 | 83
WORLD COURIER AFRICA
LOGISTICS & SUPPLY CHAIN
Cold chamber
Cold chamber “This is essential, especially in Africa, where there is a general lack of infrastructure in various countries. Our wide range of packaging material and the ability to reload dry ice help ensure shipments arrive in perfect condition, no matter how long the trip,” he explains. A final differentiating factor, according to the Managing Director, is World Courier’s flexibility. “We solve challenges on a daily basis and need to deliver in spite of ever-changing circumstances. Our size and broad offering helps us propose more adaptable solutions,” he says.
BUILDING ON SUCCESS In 2020, World Courier celebrated two milestones in Africa. The first of these was the opening of its new Kenya branch, which will enable it to expand into a new market
“Once the integration is complete, World Courier will act as a single partner for manufacturers, with the aim of reducing complexity and improving customer experience while offering a unified world class logistics platform with the highest quality standards” on the continent. One of its key priorities in the upcoming year will be to fully embed Kenya into its network. The second was the extension of its storage depot license for its GDP qualified Johannesburg site to include commercially-approved pharmaceutical products. “Those are two very important steps toward a potential further growth in Africa,” Hanselmann says. “On a continental scale, our focus will be to consolidate our two new service offerings and capabilities in Africa over the next few months.” Continuing to expand its footprint in Africa is very much the priority over the upcoming months. The conversation concludes on an optimistic note, with Hanselmann discussing a key project that begun at the start of 2020 in partnership with World Courier’s sister company ICS.
The companies started the process to integrate to become the first and only logistics partner that delivers complete support, from pre-clinical through clinical trials and commercialisation to post-launch solutions. “Once the integration is complete, World Courier will act as a single partner for manufacturers, with the aim of reducing complexity and improving customer experience while offering a unified world class logistics platform with the highest quality standards,” Hanselmann concludes.
WORLD COURIER AFRICA Tel: +27 11 394 3880 contactus@worldcourier.com www.worldcourier.com
Africa Outlook issue 88 | 85
RENDEAVOUR
Rendeavour and the rise of African cities 86 | Africa Outlook issue 88
CONSTRUCTION Executives from Rendeavour discuss the transformation of Africa’s cities and the launch of key projects Writer: Sean Galea-Pace Project Manager: Eddie Clinton
A
Rendeavour has welcomed more than 50 business to the industrial zone of Tatu City
frica is in the midst of significant transformation. A story recounted by Evans Dimba, Rendeavour’s deputy country head in Kenya, demonstrates how far Africa’s largest new city builder has come in the last five years. It was 2015, Dimba says, and the team was pitching its first industrial client to move to Tatu City, Rendeavour’s development on Nairobi’s doorstep. The pitch to the well-known Kenyan businessman was Rendeavour’s vision to make Tatu City’s light industrial area a major business hub in East Africa. In contrast to Nairobi’s old, trafficchoaked and infrastructure-deficient industrial area, Tatu City would have high-grade tarmacked roads, more power than Mombasa and a business climate unseen in Kenya’s history. The problem? “We were selling dirt and a dream,” says Dimba, who recalled the bumpy road that led to the industrialist’s future site. “There was nothing but bush.” Since that moment a mere five years ago, Rendeavour has welcomed more than 50 business to the industrial zone of Tatu City, a mixed-use mega-development with residential and commercial areas as well, which has attracted more than $1 billion of investment. The 25km of roads laid down over the last three years are plied by leading Kenyan and international companies. Copia, the Silicon Valley-backed e-commerce startup, fulfills thousands of orders from Tatu City daily. The International Finance Corporation and CDC Group are anchor investors in a 49,000 sqm Grade A logistics facility, the Africa Outlook issue 88 | 87
RENDEAVOUR largest in the region. And Distell, the South African drinks giant, is staking its expansion into Africa on a state-ofthe-art distillery at Tatu City. Across the rolling green hills of Tatu City, 5,000 affordable and midincome apartments are delivered or under construction. The high-end neighbourhood, Kijani Ridge, will sell out in 2021. Schools, which include
Evans Dimba, Deputy Country Head
Crawford International, owned by JSE-listed ADvTECH, are educating 3,000 students daily. With demand skyrocketing, in 2018 Rendeavour doubled the size of Tatu City to 5,000 acres, creating 20-30 years of development opportunity. To cap it off, last year Tatu City became Kenya’s first operational Special Economic Zone, which gives businesses a low tax base and other benefits. Tatu City’s resiliance, Dimba says, has been key to the success of Tatu City. “Building a city isn’t done from 9am to 5pm, and there are plenty of challenges. Our markets are dynamic, and there will unpredictable economic shocks, as COVID-19 has shown us. Therefore, we build deep resiliance into our business model to manage through any issues we may face.” It’s a theme that resonates with Yomi Ademola, Rendeavour’s country head in Nigeria, who has been with Rendeavour since its founding more than a decade ago. Ademola oversees Alaro City, a unique project for
ASB Valiant Powering Growth across Africa ASB Valiant is an African Corporate born out of a fervent desire and a promise of decisive action to power Africa’s growth by building sustainable communities and businesses. Today the group has become an Integrated Engineering and Energy Solutions Provider offering customers in the Oil & Gas, Construction, Real Estate, Power and Energy sectors, innovative products and smart services designed to overcome technical challenges and deliver long-lasting value to their partners. Known and recognized for its innovative spirit, reliability, technical know-how and operational excellence, the company has demonstrated dauntless commitment to solve Africa’s changing energy needs by building a better future for their consumers and local communities. The company over the years has developed keen partnerships with global industry leading manufacturers who support their delivery of highly efficient, cutting edge and cost-effective products and services thereby engineering new possibilities and fueling growth. ASB Valiant through her strategic business unit, Valiant Energy, is excited with the recent opportunity to partner with Rendevour to provide specialized multiple integrated EPC (Engineering, Procurement & Construction), MEP (Mechanical, Electrical & Plumbing), HVAC (Heating Ventilation and Air Conditioning), Mechanical and Energy (Gas & Power) solutions, to both present and future industrial investors at the Alaro City, thereby enhancing the efficiency of their varied growing enterprises. The mandate to provide the electric power for Alaro City through an end – to – end virtual ‘LNG To Power’ solution will also guarantee reliable, cost effective and sustainable services to operators within Alaro City, with stable energy tariffs.
Across the rolling green hills of Tatu City, 5,000 affordable and mid-income apartments are delivered or under construction
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To date, ASB Valiant has generated over 150MW of power on the African continent. This is expected to grow further especially with their recent expansion into the Republic of Chad and growing opportunities into a couple of other African countries. The company’s ability to assess customers’ needs and solve their unique challenges with bespoke solutions, has earned them a distinct reputation as a “trusted” partner and advisor.
Design Consultancy & Project Management Engineering, Procurement & Construction Services Industrial Energy & Power Generation HVAC Services (Electric & Non-Electric)
Integrated Engineering and Energy Solution Provider
Building / MEP Services
Gas Treatment & Compression Turnkey Small Scale LNG Plant Solutions
For over a decade, ASB Valiant has offered and provided worldclass products and services across several high-value projects on the African continent. To date, we have generated over 150MW of electric power for communities and industrial consumers across Nigeria; while we are in the process of developing close to 40MW of electric projects for the cities of N’Djamena and Moundou, in the Republic of Chad. Our team’s ability to assess our customers’ needs and solve their unique challenges with bespoke solutions has earned us a distinct reputation as a “trusted” partner and advisor. Speak with us today if you need an Integrated Engineering and Energy solutions provider that will be invested in your overall business growth and success.
Virtual LNG to Power plant
HVAC Services (Electric and Non-Electric)
ECHOLAB Building Plot 99 Ajose Adeogun Street Victoria Island Lagos – Nigeria
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Yomi Ademola, Rendeavour’s country head in Nigeria, reflects on the COVID-19 pandemic which has disrupted industries and organisations the world over during 2020 and explains there was no ‘how to’ guide on how to manage it. “Much of the developed world entered the crisis in bad shape,” he explains. “Productivity growth is at the lowest levels since the industrial revolution and fiscal deficits and levels of debt are at historically high levels in many countries. Much of the developed world will enter 2021 ‘buried in debt.’”
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“There is limited support in the developed world for the kind of conventional economic policies that are normally promoted after a crisis, e.g. austerity, measures to balance the fiscal books and reduce debt. There is also a backlash against international trade and international openness in many developed countries. In other words, the conventional view is exactly the opposite of what the World Bank and IMF normally advise or require African countries to do in such situations. Instead, in response to the crisis, big spending policies, printing money, much greater government involvement in the economy and increased trade barriers may be in vogue in many developed countries.”
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Rendeavour as the company’s only Public Private Partnership. Ademola and his team joined with the Lagos State Government to develop a 5,000-acre city in the Lekki Free Zone, designed by world-renound architects and urban planners SOM. Since its launch in January 2019, Alaro City has attracted more than 90 | Africa Outlook issue 88
30 companies, ranging from Nigerian conglomerate BUA Group to Mantrac, the Caterpillar franchise owned by Cairo-based Mansour Group. “The success of Alaro City is a confirmation of Rendeavour’s business model, which is based on three major trends in Africa: economic growth, population growth and
urbanisation – Africa is the fastest urbanising region in the world today, and perhaps in all of history,” Ademola says. “By creating a normal operating environment for home and business owners alike, who need good land title, high-quality infrastructure and controlled development, we also become significant economic catalysts in our markets.” As a master developer, Rendeavour is responsible for providing the infrastructure – power, water, waste, information and communications technology infrastructure, and roads – to individuals to build their homes and companies to build and run their businesses, as well as to specialist developers of schools and hospitals and for residential, commercial, retail and industrial properties. It also offers “build-to-suit” lease agreements. Rendeavour, with a team of 100 across five countries, works with major local and international contractors. Deloitte ranked Rendeavour’s Tatu City as the
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Alaro City - launch of Ariel Foods, the largest ready-to-eat theraputic food production facility in Africa, 2020
Africa Outlook issue 88 | 91
RENDEAVOUR
Bright Owusu-Amofah
largest construction project in Kenya after the government’s standard guage railroad, and one of the top three private construction projects in East Africa. Rendeavour is also present in Zambia, where residential phases in
‘THE EXECUTIVE IN CHARGE, BRIGHT OWUSU-AMOFAH, FORGED AN ALLIANCE WITH ONE OF GHANA’S LEADING HOMEBUILDERS AND THE COUNTRY’S LARGEST MORTGAGE LENDER, WHICH IN TURN HAS CATALYSED MORE THAN 500 HOMES COMPLETED OR UNDER DEVELOPMENT’ Roma Park, in Lusaka, are sold out and commercial space is going quickly, and in Democratic Republic of the Congo, where its project in Lubumbashi is at an early stage. In Ghana, the company is the developer of Appolonia City, a partnership with the Appolonia
tribe on 2,500 acres. The executive in charge, Bright Owusu-Amofah, forged an alliance with one of Ghana’s leading homebuilders and the country’s largest mortgage lender, which in turn has catalysed more than 500 homes completed or under development. When he visited Appolonia City to inaugurate Bijou Homes, an affordable housing development, Ghanaian President Akufo-Addo said, “Appolonia City is a laudable initiative and I want to encourage others to emulate. I’m happy to note that the Appolonia community is a shareholder in the project.” Community is vitally important to every Rendeavour city, according to Owusu-Amofah. “Local communities are stakeholders in our cities. They are one of the first beneficiaries of them, through access to jobs. We don’t build and leave. Because our cities are unprecedented in scale in Africa, we will be here for another 20 years. Probably more.”
CONSTRUCTION
Rendeavour is the developer of Appolonia City, a partnership with the Appolonia tribe on 2,500 acres
Rendeavour makes local communities a pillar of its CSR programs. It provides construction skills training for free, filling a needed gap for contractors and ensuring a high job placement rate in its cities (in four years, Rendeavour’s cities added more than 5,000 new jobs to local economies). In some cases, the company underwrites meal programs in nearby primary schools, which have boosted nutrition rates and, in turn, academic performance. “We can’t be an island, disconnected from the communities and cities around us,” says deputy country head Dimba in Kenya. “We are building open cities that connect with local, national and regional transport networks and people and businesses both inside and outside our developments.” Looking to the future, Rendeavour’ exectuives say they have plenty on their development plate – 30,000 acres of land in the growth paths of
seven of Africa’s fastest-expanding cities. “We are building demand driven, city-scale developments over the next 20-30 years,” says Dimba, who notes that Rendeavour is a group of “long-term, individual shareholders with with a vision”, as opposed to a fund whose investors require an exit and return in, for example, five years. At the same time, as the company completes projects, the Rendeavour team can transfer its knowledge to new markets. For this reason, Rendeavour is always open to new opportunities.
RENDEAVOUR Tel: +254 20 513 1000 info@rendeavour.com www.rendeavour.com
Africa Outlook issue 88 | 93
KUDUMANE MANGANESE RESOURCES
Manganese mining is not a sunset industry, but rather a sunrise one.” From the early 2000s to the present day, African manganese mining has proved to be an evolutionary industry. Where there were once only a few producers dominating the market, 94 | Africa Outlook issue 88
today there is competition from more than just a handful of players. South Africa in particular has managed to cement its position as the global leader in manganese production, providing and sourcing 80 to 85 percent of the globe’s manganese, allowing the nation to
maintain a monopoly on this industry and consolidate itself as a reliable and efficient producer of the resource. At the beginning of the 21st century, South African manganese exportation reached around eight million tonnes per year, and as of 2020 this has increased close to 20 million tonnes.
MINING
The Core of Kalahari Mining South Africa is the largest producer of manganese in the world, we spoke to CEO Thembelani Gantsho about being front and centre in the mining industry’s subsector Writer: Marcus Kääpä | Project Manager: Joshua Mann
The evolution of the manganese mining sector is proof that positive change is apparent in older industries, and the newer sectors, for example digital communications, are not the only ones to share in the limelight of growing business. Thembelani Gantsho, CEO of
Kudumane Manganese Resources (KMR), considers the industry one that is reformed and reinvigorated, and one that sits amid the number of “sunrise” industries he refers to in the opening statement of this article. “Since the new Minister of Minerals and Energy in South Africa, Gwede
Mantashe, has become involved in the sector, there is better cooperation between the industry and the department, and there’s a concerted drive to bring vibrancy back into the industry,” he continues. “There is a greater effort to promote the sector to drive development. Africa Outlook issue 88 | 95
KUDUMANE MANGANESE RESOURCES I think South African mining can rise further than it has done so in the past two decades.” KMR is one of the businesses at the centre of South African manganese production. Based in the John Taolo Gaetsewe District Municipality (Northern Cape province), it operates two primary manganese ore mine projects: Farm York, and Farm Hotazel – projects that collectively produce approximately 1.8 to two-million tonnes of manganese ore per year. The firm sells and exports around 1.6 to 1.8 million tonnes of this manganese each year, and to do so, employs over 1,000 individuals. The bulk of the workforce, that adds up to around
900 people, are hired independent industry contractors, while the latter and smaller portion of the workforce is made up of direct KMR employees. “We also form part of the Asia Minerals Limited group which is a Hong Kong-based manganese and alloys trading organisation, with offices in Japan, the US, Singapore, and in mainland China, and smelters in Malaysia - an entity which is at the global industry forefront,” Gantsho tells us. “Being a part of this group ensures that at least 95 percent of our production is spoken for before we even start the year, as we operate on frame contracts.”
MANGANESE IN FOCUS SOUTH AFRICA’S MANGANESE DEPOSIT South Africa has the largest mineral resource and reserve base of manganese in the world and ranks second after China in both the global production and exportation of manganese ore. South Africa holds 80 percent of global reserves with a 34 percent manganese content, the majority of which comes from the Kalahari Manganese Field. The country’s share of the world’s high-grade manganese reserves far outweighs, for example, Ukraine with nine percent, India’s three percent, and China’s two percent. THE KALAHARI MANGANESE BASIN The Kalahari Manganese Field, located in the Northern Cape, is the largest known deposit in the world and is estimated to contain approximately 13 million tonnes of exploitable manganese. These reserves, which represent more than 80 percent of the world’s total reserves, are contained in the basin located between Mamatwan Mine, Wessels Mine, and covers an area of about 40 kilometres north to south, and between five to 15 kilometres east to west. KMR GEOLOGY There are two main ore types in the Kalahari deposit, the primary Mamatwan type ore, and the secondary Wessels type ore. Farm York is located towards the eastern end of the Kalahari Basin, which consists mainly of the Mamatwan type ore and is split by a pair of dykes. Generally, manganese enrichment is found alongside the contact of such dykes, and the primary resource on Farm York is towards the northern end of said dykes. A large portion of this resource extends onto Farm Telele. The ore on these KMR farms is sufficient to support continued mining activities for more than 30 years.
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Africa Outlook issue 88 | 97
KUDUMANE MANGANESE RESOURCES
“I don’t believe in micromanagement because I think it stifles the benefits of creativity and autonomy” – Thembelani Gantsho, CEO COMMUNITY FOCUS Gantsho’s career path has spanned multiple positions in various sectors, each of which has given him the experience to lead him to his current position as CEO of KMR. Gantsho spent his early career working within the financial sector. He began as an investment banker with what was ABSA Corporate and Merchant Bank (formerly Barclays Africa Group Limited, and now part of ABSA Group Limited), and was heavily involved with the Black Economic Empowerment (BEE) initiatives in the mid 2000’s. From dealing with transactions for ABSA, Gantsho then went on to join Ernst & Young where he focused on corporate finance, and worked on cross-border, as well as SOE, transaction terms. After he was headhunted to join what was Xstrata Alloys (now part of the Glencore group) in its business development and strategy division, which also focused on acquisitions. Following his position in this division with Xstrata, Gantsho was offered (and accepted) the position of Associate Principle of ABSA Capital’s Mining and Metals Division – a position he held for almost two years. But Gantsho wanted more, and to move 98 | Africa Outlook issue 88
into the mining industry in a greater capacity then he had been before. “I then decided to join a boutique firm called Africa Capital Rising (“Afris Capital”), and one of the transactions that we carried out was the acquisition of a stake in Kudumane Manganese Resources,” he tells us. “I have been with KMR effectively since we did that transaction, which has been almost eight years now, and I have moved up the ranks in KMR to the position I am in today.” And from the position of CEO, Gantsho has been able to aid the promotion of business practices that sets KMR apart from other firms in the mining sphere, through
the incorporation of people-centric company values. One such value is the promotion of autonomy. “I don’t believe in micromanagement because I think it stifles the benefits of creativity and autonomy,” the CEO says. “Instead, our employees learn to take full accountability for their departments and for their actions, it allows for consequential management in those cases when it is needed, and the promotion of healthy leadership and initiative as a result.” Autonomy certainly has its benefits, and Gantsho believes that it enables his employees to become empowered through taking the ownership of a
ENVIRONMENTAL MANAGEMENT KMR’s green vision is to minimise the negative impact on the environment through the optimisation of resource consumption and the protection of biodiversity in the land. This can be achieved by ensuring that the design of the mine, operating methods, and systems, as well as the rehabilitation of the mining operation, will be done in an environmentally responsible manner. The company is highly committed to the continued improvement of its environmental performance. It understands that part of being a responsible land steward, is ensuring that the communities close to the mining operations are left with a self-sufficient and self-sustaining legacy. The Company’s approach to environmental management for compliance with legislated requirements and accepted industry practice, is through the continued engagement with the relevant stakeholders. KMR has also established a biodiversity offset area on the mine, which includes an 870-hectare game farm with a fully functional lodge. The lodge consists of six individual chalets that are fully furnished with a main dining area. As part of the company’s ongoing enterprise development, local women who were previously employed by the company have been given the opportunity to start their own business by providing hospitality and catering services at the lodge.
MINING specific department, task or project into their own hands. KMR’s operation is based on a more flexible structure whereby there is a mine manager who runs mining operations, but aside from the necessary company figureheads (those of finance, legal, HR, logistics, and sales), hierarchy is not a structure within which KMR operates. “The way I see it, to run departments well is to give the corresponding employees the autonomy with which to take responsibility for its success,” Gantsho adds. “Through this method of company organisation, and lack of micromanaging, each employee gains the self-confidence to see themselves as a leader of their own sphere, and act accordingly.” It is not just the employees that are included in KMR’s people-centric company values. As a firm that employs locally, the surrounding communities are benefitted by a company that supports the local economy and individual and family livelihoods. As the separate mine projects could last anywhere from five years to multiple decades, Gantsho assures us that the effects of the firm’s presence, both during and after, supports the local people, communities, and environment. “We are a strong believer in giving back to the community in which we operate. We must ensure that the legacy we leave is a sustainable one that benefits everybody who is involved locally, and one that outlives KMR’s presence in these areas,” Gantsho says. Various initiatives and corporate social investments are also implemented in order to help strengthen local economies and the lives of those living in the project areas. The company’s community development commitments focus mainly on water infrastructure, education, health, and agriculture for
the locals, and the implementation thereof is rolled out in terms of the company’s Social and Labour Plan. “We pride ourselves on the fact that 80 to 85 percent of our employees come from the local project areas, and we make it a point to prioritise local service providers regarding company service needs,” Gantsho adds. “KMR spends a lot of resources in developing small enterprises and aiding such aspiring businesses. We really do a lot of in terms of helping our overall communities.”
POWERED BY PARTNERSHIPS Aside from the people-centric values that KMR holds dearly, another aspect of business that differentiates it from the rest of the industry is that KMR itself does not chase the market to sell manganese resources. As KMR works on a frame contract, the firm works, produces, and is set to sell a certain amount of manganese each year – a prospect set up well in advance. This sets the firm apart from competition in the market, as it simply has none. KMR therefore becomes a reliable business that continues to produce and export its manganese resources at a steady rate to preplanned buyers. This additionally helps create very reliable and positive long-term business relationships between supply chain partners – an incredibly important aspect to a company dealing with providing its mining produce around the globe. “The relationship between ourselves and our contractors is paramount,” Gantsho continues. “Without them we wouldn’t be able to perform at the level that we are performing currently. KMR values the relationships it has with all its supply partners and service providers. “I would say that our biggest contractors are our mining contractors, and partners that provide ore crushing, drilling, blasting, as well as of course the logistical side of the process.
“When you consider the industry, mining and logistics are the two biggest elements of operation. Currently KMR’s logistics are provided by Transnet, and they are an important partner to the firm and its ability to export materials to our customers. “These relationships are very valuable, and we nurture them over time so that it benefits all parties involved with continual growth.” Investment and the future In the wake of the COVID-19 pandemic, KMR has shifted its focus and instead committed to internal investment to strengthen its business practices, methods, and increase efficiency. “KMR’s has shifted its focus to improving our operational efficiencies, optimising our operations, and looking at ways to extend the life of mine project through synergies with collaborations through our neighbours, as well as increasing the sustainability of our practices,” Gantsho adds. “We invested in excess of $150 million into this operation, and we continue to invest in the internal bolstering projects. Annually, KMR invests between $10 million and $20 million to see this happen.” As for the next few years, Gantsho assures that this internal investment remains the key to KMR’s continued success through the COVID period, and that the future of KMR’s manganese mining surrounds the sustainable and people-centric business values that have consolidated its position in what is an industry of growing importance.
KUDUMANE MANGANESE RESOURCES Tel: +27 11 880 2771 www.kmr.co.za
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JINDAL MOZAMBIQUE
Mining in Mozambique We spoke to Rajendra Tiwari, Business Unit Head of Jindal Mozambique, about the company’s operation in the southern African mining industry Writer: Marcus Kääpä | Project Manager: Josh Mann 100 | Africa Outlook issue 88
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ozambique is mostly known for its long coastline bordering the Indian Ocean, its tropical waters, and the resulting popular beaches and holidaying locations. But beneath the soil the country also has a rich and varied abundance of natural resources including coal, graphite,
marble, iron, copper, and gold among many others. These resources have allowed Mozambique to become a substantial contributor to the southern African mining industry. Jindal Mozambique Minerias Limitida is one such company that has stepped into the spotlight
MINING
of the industry. Part of the Indian conglomerate Jindal Steel and Power Ltd (JSPL) - a leading global player in the steel, power, mining, coal-to-liquid, oil and gas, as well as infrastructure sectors - the business branch in Mozambique brings the professionalism of decades of
experience and practice within the mining sphere to African shores. Other aspects of the businesses’ core strength also lie in its steel production and power plants, both of which it has in India and abroad, as well as additional coal and iron ore mines, kept moving forward by an
impressive 1,200 employees. The southern African mining sector is a promising area, as Jindal’s Mozambique branch’s Business Unit Head, Rajendra Tiwari, explains. “There is tremendous potential in the country. There is a requirement to develop some of the infrastructure in Africa Outlook issue 88 | 101
JINDAL MOZAMBIQUE Mozambique, especially road and rail networks, to maximise the opportunity of its mineral reserves such as coal,” he tells us. This requirement is being met by Jindal’s ability to utilise its widespanning industry knowledge and apply it to practices that see the company showcase exactly how southern African mining can reach the heights of productivity.
CAREER GLANCE We asked Rajendra Tiwari (RT) about his past career and how he came to be a part of the African mining industry: RT: I studied at the Indian Institute of Technology, Kharagpur, in mining. Having graduated in 1993, I joined a coal mining government organisation until 2008. I consider that moment as the start of my career journey. I worked hard and reached the level of Deputy General Manager with the organisation before being offered an opportunity to work with Jindal Steel and Power Ltd, through which I became Statutory Mines Manager of a 6.25 MTPA coal mine. I got an opportunity in JPL in 2008 and became statutory Mines manager of a 6.25 million tons per annum (MTPA) coal mine. This preceded a chance to work on a brilliant overseas project – I have been working in Africa since 2012. Most of the time I was working in coal mines only. I am also holder of First-class mines manager competency certificate (coal) issued by DGMS India.
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“We have a 4.5 tonnes per annum coal mine in Mozambique and an 800 tonnes per hour coal beneficiation plant. This mine is in Tete province of Mozambique on the Tete Songo Highway (about 120 kilometres from Tete). We produce coking coal and thermal coal,” Tiwari explains.
INVESTMENTS AND PARTNERS Jindal Mozambique prides itself on its operational efficiency and safety concerns for its employees. Through these primary values the company was able to weather the worst of the industry impacts being caused by the coronavirus pandemic. To showcase this, there is no better example than Jindal’s $23 million investment in
increasing operational efficiency. “Our project was initially of 400 tonnes per hour. We expanded this to 800 tonnes by installing an additional dense media separation (DMS) plant, spiral plant, DMS thickener, tailing thickener, and associated infrastructure,” Tiwari continues. “We have also expanded the mining capacity accordingly by purchasing four new Volvo 950 excavators and supporting equipment like dozers, graders, and water sprinklers. We also brought one RH120 along with five Cat77D dumper trucks. We could increase our mining capacity from three million metric tons per hour (MTPA) to 4.5 MTPA with this new equipment.”
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A FOUNDER’S STORY Shri Om Prakash Jindal, Founder and Chairman of the Jindal Group, was born on August 7, 1930, to a farmer in Nalwa village of Hisar district in Haryana. Having an interest in technology from a young age, he started his industrial career with a humble bucket-manufacturing unit in Hisar in 1952. In 1964, he commissioned a pipe unit, Jindal India Limited, followed by a large factory in 1969 under the name of Jindal Strips Limited. Shri Jindal envisioned a self-reliant India in every sector of industry. To help bring about this vision, he gathered the latest technical know-how from around the world and strengthened his industrial establishment. Recognising his outstanding contribution to the Indian steel industry, Shri O. P. Jindal was conferred the prestigious “Lifetime Achievement Award” by the Bengal Chamber of Commerce & Industry in November 2004. Shri Jindal believed that without the upliftment of those in society who were more disadvantaged, a nation can never prosper. Because of this, he spent a lot of time in taking steps to alleviate poverty and boost disadvantaged communities. He was elected a Member of the Haryana Legislative Assembly three times, and a Member of Parliament in the 11th Lok Sabha, from the Kurukshetra constituency of Haryana, with a landslide victory in 1996. He also served as the Minister of Power, for the Government of Haryana. His multifarious career was tragically cut short with his accidental death on March 31, 2005. He is a visionary remembered for his business excellence and social responsibilities alike.
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JINDAL MOZAMBIQUE
SUSTAINABILITY AT A GLANCE Jindal Africa believes that no corporate activity should be conducted without a comprehensive social responsibility (CSR) programme to ensure that the foundations are laid for a long lasting and beneficial legacy. Jindal has a long-term view of Africa and endeavours to set an example for other corporate institutions looking to expand globally by the way it contributes to the overall economic development of the continent. The company is noted for living up to its commitment to ensure sustainable development in the areas where it operates by building long-term relations and partnerships with key stakeholders. Central to its engagement strategy is a firm commitment to contributing to sustainable development through various CSR initiatives that demonstrate Jindal
Africa’s commitment to investing in the social upliftment of the people in Africa. Social responsibility is a central theme that drives Jindal Africa’s business operations. This business philosophy demonstrates the company’s commitment to its vision and mission that aim to add value to the lives of communities and stakeholders touched by operations. Jindal works alongside a set of core sustainability values that is holds to in all times and areas of operation. Pillars of sustainability: - Education - Health - Livelihood - Infrastructure development - Livestock management - Youth and sports - Environmental protection
This internal investment does not only increase operational efficiencies to a new maintainable high level, but it also increases Jindal’s capacity to reduce operational costs and consequently remain competitive in the market. Alongside self-investment, key supply chain partners make up an important part of Jindal’s industry success. A healthy relationship with stakeholders and suppliers ensure that the company continually meets and exceeds the expectations of its customer base.
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CORPORATE RESPONSIBILITIES A large part of Jindal is its peoplecentric approach towards operation. This does not only mean the safety of its employees, but also the development of each working company member, and on top of this, the chance to improve and advance. “Our company gives a lot of space for the staff to learn, and even make mistakes, and develop from this to contribute to the long-term development of the company and society as a whole. It is because of the hard work of all of Jindal’s employees that we are in the industry and leave a strong footprint,” Tiwari tells us.
This consistent attitude towards learning, personal development, and hard work makes Jindal one company that has moved into the new year with a mindset for growth. Tiwari ends by elaborating on the company’s priorities for the rest of 2021. “2020 has not been an ideal year in terms of the coal market and pricing. We are still hopeful that there will be some improvement in coal prices next year as there is a lot of potential it. There are challenges in terms of infrastructure in Mozambique and I hope the government will take appropriate measures to solve these issues. “However, we have recently
commissioned our expansion project - there are only some small aspects to be finished for completion. We need to reach the highest capacity in terms of production, and so we are also under discussion with the government of Mozambique to set up a 2x75 megawatt coal based thermal power plant in our mining license area.
JINDAL MOZAMBIQUE Tel: +258 2 130 4880 info.moz@jindalafrica.com www.jindalafrica.com
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GREEN RESOURCES
Forward Thinking Forestry in Africa can be both sustainable and profitable, we speak with Hans Lemm, Group CEO of Green Resources, about how the company is expanding and, in the process, making an impact on the lives of local communities Writer: Marcus Kääpä | Project Manager: Thomas Turnbull 106 | Africa Outlook issue 88
AGRICULTURE
W
ith such a focus on global sustainability, it is no surprise that plantation forestry is an internationally growing industry. The removal of woodlands and rainforests, and the clear link between forestry reduction and the rise in carbon levels in our atmosphere, has influenced many businesses and industries to change the ways they
operate. The Amazon Rainforest, for example, absorbs two-billion tonnes of CO2 annually, making up for five percent of global carbon emissions – a vital contributor to the prevention of global climate change. Continued deforestation consistently lowers its ability for carbon absorption, and because of this there is an urgent need
for a shift in individual and business mentality – a turn to promote and coexist with the environment through sustainable practices. It is estimated that in in Africa over two million hectares of forests is lost every year. Population growth, urbanisation, and a growing middleclass put pressure on the continent’s forests. Africa Outlook issue 88 | 107
GREEN RESOURCES For Africa, the plantation forestry industry is utilised as a supplier of raw materials for electrification and construction projects, as well as a source of job provision for communities in rural areas. In addition, timber produced from sustainable plantations is easing the pressure on natural forests. Sustainable, responsible forestry is a key to curbing de-forestation and climate change, as well as to develop local economies and generate jobs. Despite the global impact of the COVID-19 pandemic, this industry in Africa has weathered what many struggled to. Green Resources has seen its products designated as part of the critical supply chain, and so have been allowed to operate throughout government imposed “lockdowns” in Uganda and Mozambique in order to continue the service of its industry customers throughout the pandemic period. “We have seen limited impact from COVID-19, other than that travel across the region has become more difficult,” Hans Lemm, Group CEO of Green Resources, begins. “Aside from a two
month “wobble” in April and May, our markets have generally continued to function as before, and we have been able to continue to drive our industrial investment programs. “COVID-19 has had a major impact on many industries, but I have been positively surprised on the resilience of our industry and frankly the region overall.” “We do expect some more impacts to come in the first half of 2021 but then we foresee a rapid recovery and looking at the results of the local banks as well as other financial indicators we are quite confident on the future,” Lemm tells us. Green Resources is a vertically integrated forestry business that has been active in East Africa since 1995, and currently manages around 35,000 hectares of planted forests spanning Mozambique, Tanzania, and Uganda. The company primarily produces sawn timber (both treated and untreated) and transmission poles, that serve customers from both private entities as well as government enterprises including national utility companies.
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Africa Outlook issue 88 | 109
GREEN RESOURCES “We operate sawmills in Tanzania and Uganda, Pole Treatment Plants in all three countries, and we’re currently constructing a veneer plant in Mozambique which will become operational in the second quarter of 2021,” Lemm tells us. “Additionally, a large part of our landholding is certified according to the Forest Stewardship Council (FSC) Forest Management Standards, and one of our mills has a Chain of Custody Certificate.” On top of its industrial products for end users, Green Resources supplies raw materials to third-party sawmillers and plywood factories as well as biomass to various industrial users. The company currently employs around 900 employees and another 500-700 workers on a daily basis through contractors. With approximately 100 private
shareholders, and two large European Development Finance Institutions as financial backers, the company is able to promote forestry in multiple African countries to great effect. And what really sets the business apart in the industry is its diversified product portfolio, combined with that fact that it is one of the most advanced operations among the “New Generation” African project developers. Including Green Resources, there are plantation forestry projects being developed in Ghana, Sierra Leone, Mozambique, Kenya, Tanzania, and Uganda. “We believe Green Resources’ investors are well positioned to capitalise on the growing global appetite to invest in businesses with strong Environmental and Social Credentials in combination with attractive financial returns,” Lemm continues.
STEMMING FROM AN OPPORTUNITY We asked CEO Hans Lemm (HL) about his career past, and how he came to work in the forestry industry. HL: The short and simple answer is “by accident and not by design”. As a young engineering graduate from the Netherlands, I was looking for adventure and aspired to develop an international career and the industry did not matter that much, as a matter of fact I had never even thought of forestry as an industry. In 2002 I applied for a job in Tanzania following an advert in a newspaper job section that stated: “Wanted: Manager for Chipboard Factory in Tanzania”. I mentioned in my application that I had “Africa experience” and to my great surprise I got the job. I started off as the Operations Manager and after six months was promoted to General Manager of the business. I stayed with this first company for almost three years and then worked for a couple of different companies in the forest industry in East Africa in a variety of roles increasingly senior and more complex in terms of business. My last role before Green Resources was as CEO of Africa’s largest teak plantation, a position I held for just over 10 years. Here I had the privilege to manage the transition from plantation development project to forest industry. In many ways this was not too different from my current role although Green Resources, where I joined in April 2019, is significantly larger, more complex and has a much bigger corporate component that needs to be managed.
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“Green Resources has a positive carbon footprint, meaning that our overall business absorbs more CO2 per annum than it emits, and our forestry estates act as a carbon sink.”
FROM PLANTATION FORESTRY TO FOREST INDUSTRY Green Resources operates through two primary business units. The “upstream” unit surrounds the forest plantations and its associated activities, while the “downstream” unit contains the industrial operations where the products from the upstream operations are processed. The raw materials for the downstream units are sourced from the company’s own plantations as well as from third-party suppliers including smallholder tree farmers. “In our upstream areas we manage approximately 35,000 hectares of planted forestry with around 13,000 hectares in Mozambique, 15,500 in Tanzania, and 6,500 in Uganda,” Lemm elaborates. “The planted areas are roughly split 50-50 between pine and eucalyptus species. The primary product for the pine planted areas are sawlogs (raw material for sawmilling), and for the eucalyptus planted areas they are transmission poles and peeler logs (raw material for plywood production). “In addition, all forest areas generate by-products for various biomass markets ranging from domestic to industrial use.” The two business units allow Green Resources to expand its forestry development while also sourcing sustainable wood products and resources to a multitude of customers. The company’s upstream operations consist of two sawmills in Tanzania and Uganda, three pole plants covering the firms three countries of operation, a Tanzanian based briquetting plant, and a veneer factory in Mozambique. The mixture of tree species, products, and in-house and external processing
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GREEN RESOURCES
INVESTING IN THE SUSTAINABILITY MISSION HL: A key investment has been the long-term view of our founders who in a very early stage recognised the potential of green investments in Africa and who positioned Green Resources as a platform for combatting climate change. We believe the importance of green investments is now becoming clearer than ever before, but this was not the case when the company started in the late 90’s. Another investment has been the early decision of the company to comply with the Forest Stewardship Council Principals and Criteria on sustainable forest management. The FSC standards have become the must have standard for forestry investments in Africa and in many cases a pre-requisite for accessing capital. Green Resources is proud to manage 38,000 hectares of FSC certified areas and is in the process expanding its FSC Certified areas. We can start seeing this investment pay off in Uganda where increasing numbers of customers (including Kenyan buyers) are enquiring for FSC Certified Timber due to its sustainability credentials.
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provides the business with a robust revenue model where many products (as well as geographies) are countercyclical to one another. “A good example of this is Tanzania and Uganda. Where the Tanzanian pole market was booming most of 2020, it has currently slowed down a bit pending the release of new tenders. At the same time, the Uganda pole market has picked up tremendously since July,” he continues. “The same goes for the Tanzanian timber market which has been sluggish for most of 2020, but we are now seeing an increase in uptake offsetting some of the reduced activity in the pole market. “The start of the Industrial Operations in Mozambique in 2019 and expansion into veneer in 2021 will further enhance the diversified nature of our operations and strengthen our
revenue model.” For many years the focus in African forestry has been on planting new areas but we can see a shift where more investors are looking for investments in downstream operations. “We hope more investors will come to this conclusion as the industry currently needs more industrial capacity in order to drive the attractiveness of African Plantation Forestry into the future,” Lemm says.
COMMUNITY AND OPERATION Green Resources as an organisation prides itself to be people-centric and sustainability-orientated. Forest plantations are not only a lucrative base for investment but also provide for the environment, ecosystem, and communities. Green Resources places its
AGRICULTURE employees and surrounding communities as a highly important aspect of its operations. In some areas, the company provides housing for its staff and their families, and all members of staff are provided with medical insurance cover. For senior members of staff, the firm has in place incentive schemes in order to better the possibilities of those involved. “We employ around 900 people in Green Resources and a large percentage of our jobs are held by people who had limited exposure to formal employment,” Lemm explains. “Training is a very important part of how we improve the skills of our workforce. During the first half of 2020 we provided training to 2,500 people - most of our staff members received multiple training courses during the first six month of the year. “The number of fully trained individuals in the first half of 2020 is almost the equivalent of the amount of training we provided in the whole of 2019 (2,700 people).”
The training provided to the Green Resources employees covers a wide range of topics ranging from safe work practices, health education, and defensive driving training, but are also extended to forestry contractors who we assist by training specific skills such as financial literacy courses. The company does not limit itself to these training courses, however. To better the prospects of any aspiring employee, Green Resources commits itself to individual betterment through providing opportunities such as university sponsors. “At the moment we have one member of staff following an MBA at the African Leadership University in Rwanda partially sponsored by the company, and we are aiming to increase these opportunities in the future,” Lemm continues. Training doesn’t stop with its own workforce, and in Tanzania, Green Resources has a partnership agreement with the Dar es Salaam Campus of Mzumbe University where
the company regularly works together with University staff to bring real life case studies to train young graduates. “Aside from training we believe that dialogue with our staff is very important, and to this end we ensure that our workforce is unionised. In this way management and staff can engage in structured discussions on a wide range of topics - not only salary, but topics such as safety, long term viability, employee and community engagement, the list goes on. We are proud to say that in all the countries in which we operate, our wages are significantly ahead of minimum wage.”
PLANTS AND PEOPLE-CENTRIC BUSINESS Green Resources believes that the surrounding communities are a crucial aspect of its business model and that the company can only truly be successful if the neighbouring communities are benefitting from the company’s presence. Because of this, the company seeks to aid the
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GREEN RESOURCES
SUSTAINABLE SUPPLY CHAIN PARTNERS HL: Suppliers and partners are of crucial importance to our business and we especially see this in less developed markets or emerging forestry markets such as Mozambique where many inputs are not readily available. Essentially our key suppliers in the group invest side by side with us in these territories by putting in consignment stock or bringing product into the country based on a single or limited user base. On the market, we have positive experience with customers taking exposure through prefinance of product. Aside of the larger scale suppliers our businesses deal with literally hundreds of small-scale farmers who supply some of the raw materials to our processing plants. During the last financial year, we procured raw materials worth $3.8 million from smallholder forest owners.
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surrounding communities through a variety of interventions ranging from CSR activities to creating business opportunities and be part of the company’s value chain. “Green Resources is well aware of the fact that we have access to large areas of land under long term lease agreements where previously these lands were part of communal lands and therefore, we need to ensure that communities benefit from our presence,” Lemm elaborates. “During 2019, we spent close to $200,000 on community projects, and in the first half of 2020 we have spent $180,000.” The firm’s land titles are critical documents when it comes to discussions with its investors, bankers, and governments. However, the real “title deed” lies in the company’s ability to promote and maintain the
relationship with the surrounding communities. Failure in this will result in the loss of rights of access to the landholding. In this way, Green Resources not only integrates the community into its operations but ensures that it must continue throughout its actions and into the future – solidifying the continual people-centric element to the firm. “In Mozambique we have for many years had a Community Social Fund where, each year, villages would receive an amount relating to the planted areas, as well as a bonus amount against set indicators (for instance fire avoidance, absence of poaching, and others). We are now in the process to roll out the same Social Fund principle in Tanzania and Uganda where the first disbursement in Uganda was made in November,” Lemm elaborates.
AGRICULTURE “Over the years Green Resources has either direct, or through its social fund, built roads, classrooms, boreholes, hospital wards, teacher’s houses, marketplaces and many more structures in the surrounding communities, and it is extremely rewarding seeing structures made with our support being used and maintained by the community.” The Social Fund allows the communities to decide how funds will be put to use and once the company green-lights a project it is cleared for implementation with active company monitoring. The company believes the Social Fund system is a much stronger and longer-term commitment than the traditional approach of one-off projects.
“Probably our biggest contribution to local development is the fact that a significant part of our raw materials, in particular for electricity poles, is procured from smallholder farmers,” Lemm tells us. “In Tanzania and Uganda combined we bought raw materials worth $3.8 million from smallholder farmers during our last financial year.” Green Resources collectively across its three operational countries has manufactured and sold 111,000 poles during its last financial year – the equivalent of 5,500 kilometres of new power lines built in predominantly rural areas. The integration of communities into the company’s value chain provides a brilliant and mutually beneficial situation.
As for the near future, Green Resources is aiming to continue the growth of its operations in Tanzania, Uganda, and Mozambique, forecasting a 15 percent year-on-year growth that will firmly position the company as the largest forestry business outside of South Africa.
INVESTING IN SUSTAINABILITY There is increasing awareness of human impact on nature and the need to develop sustainable business solutions. Sustainability has become the new norm, and many companies are looking for opportunities to develop this element of business. This is not only because they believe it is the right thing to do, but also due to anticipated regulatory requirements – a positive foresight that is driving environmentally beneficial practices. It is expected that the EU will soon launch a new raft of measures that will define reporting requirements and sustainability targets. These new regulatory requirements will lead to increased interest in ecological business models. As a result, sustainable investments as well as those in natural capital, are rapidly emerging as an asset class on their own, and many large global asset managers are searching for opportunities to invest in sustainable enterprises. One lesson that can be taken from the COVID-19 pandemic is that environmentally friendly businesses have proven to be resilient against external shock. Green Resources is leading the way in East Africa and investors are encouraged to keep an eye on the developments of this business.
GREEN RESOURCES info@greenresources.no www.greenresources.no
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EVENTS
Mining Indaba Virtual February 2-3 | www.miningindaba.com
Resilience and regrowth in African mining M INING IN DABA has returned in a virtual format to bring visionaries and innovators from across Africa together. The conference is renowned as the world’s largest mining investment event with a long, distinguished history in Africa’s business calendar and a truly global audience from Australia and South Asia to Europe and North America. Mining Indaba attracts junior, mid-tier and major mining companies, investors, the largest gathering of Mining Ministers in Africa and this year plays host to four Heads of State. From industry giants to tomorrow’s barrier-breaking disruptors, everyone who is anyone attends Mining Indaba to connect and learn. 116 | Africa Outlook issue 87
Mining Indaba Virtual is set to take place between the 2-3rd February 2021 and will merge the public and private sector together to debate challenges and opportunities around ESG, supply chain transparency and international cooperation that will allow mining activity to prosper and succeed. The event will aim to tackle and cover topics including using mining to reboot national economies, embracing ESG in the boardroom, ESG investing in a COVID-recovery world, resilience, responsible sourcing of African minerals, the energy transition and the rise of gold in the pandemic. To register for free, click here!
WHY ATTEND? - Thought-provoking discussion about the most relevant trends and hottest topics in the mining industry today. - Networking opportunities with like-minded individuals. - Insight and guidance from industry pioneers and innovators in the mining sector following a challenging 2020. - Hear from four Heads of State. Speaking at this year’s event is H.E. Cyril Ramaphosa, President of South Africa, H.E. Mokgweetsi Masisi, President of Botswana, H.E. Julius Maada Bio, President of Sierra Leone and H.E. Félix Tshisekedi, President of the Democratic Republic of the Congo.
Register today at www.miningindaba.com
THE FINAL WORD To round off each issue, we ask our contributing business leaders for their views on the same question
WHAT WILL BE THE BIGGEST TREND IMPACTING YOUR INDUSTRY IN 2021?
Johan Steyn Managing Director, Aerosud "The impact on SME’s in aerospace supply chain will take another six to 12 months to fully play out. There will be casualties on the one side and opportunities on the other side. We have experienced the impact on the supply chains and established system have been disrupted. Being agile and adaptable – with robust underlying business processes - will be vital to stay on track. Our offering has to expand and be even more creative."
Hans Lemm Group CEO, Green Resources "The Green Economy is expanding rapidly as the world becomes more sensitive to the role of nature and developing sustainable solutions for the future. Green Resources, as a forestry company is part of the Green Economy and we are always on the lookout for new opportunities. "A trend that seems to be emerging in other parts of the world is the use of Cross Laminated Timber (CLT) as a green and sustainable building material to substitute Concrete and Steel. There are emerging voices who say that that on the long run Concrete and Steel should be looked at in the same way as we are looking at Petrol and Diesel. " 118 | Africa Outlook issue 88
Tim Jaques CEO, Motus Africa "An important trend is environmental awareness and an increase in interest in electric vehicles. Nissan is a global leader in the development of electric vehicles, and we hope to be able to work with the OEM to offer these vehicles to the markets in the future."
Remo Hanselmann Managing Director, World Courier Africa "The roll out of a COVID-19 vaccine could expedite the development of the biopharma industry on the continent. From a logistics perspective, we require new levels of planning and coordination, resources and funding, as well as to consider the impact of new regulations. We’ve seen these trends start to emerge, but the impact of the pandemic has forced this change to accelerate."
Seun Oni Group MD/CEO, A.G. Leventis Nigeria "The role of digital technology will continue to be a disruptor and dominate the play within the industry and equally we should expect to see conversations around green revolution gaining ground and gas-powered engines will play a critical role in this journey. "However, I believe a bigger trend, will be the impact of the African Continental Free Trade Agreement (AfCFTA), logistics is at the heart of bringing this agreement to fruition and it will also push the path for consolidation and strategic partnerships within the industry."
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A GLOBALLY RECOGNISED SUPPLIER In a country of extreme diversity and a history of innovation, we have no shortage of talent – which is also reflected by the average age of workers being 35 years-old.” That is the belief of Johan Steyn, Managing Director at Aerosud. The South African aerospace
development of six work packages with Airbus France, Germany and UK. This programme resulted in the development of interesting technical solutions, but also meant digital and collaborative design solutions along Africa Outlook issue 88 with several Airbus approvals for several products and engineering services.
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country with language and cultural compatibility with all major OEMs.” Alongside his role at Aerosud, Steyn is also Chairman of the Board of CAMASA (Commercial Aerospace Manufacturing Association of South Africa). Formed in 2016 as a non-profit organisation that strives to promote a bi-lateral growth strategy between private industry and government in South Africa, CAMASA’s vision is aimed at doubling the aerospace manufacturing turnover in five years, focused primarily on exports. In order to streamline processes and increase efficiency, manufacturers around the world are embracing digital transformation and introducing new technology into operations. In the case of Aerosud, the company has introduced a highly specialised 3 welding robot process on A320 and A350 products driven by cost, critical skills, and volumes to be produced. “Digital business processes and integrated business system is very
industry is active and vibrant, and range of the world’s leading aerospace demonstrates a significant history original equipment manufacturers. of aerospace innovation, research, Steyn recognises the plethora of talent development, and manufacturing. The that fills South Africa. Some of its major projects throughout the years include: industry was already manufacturing “Opportunities in South Africa is the 1990-1995 – Aerosud was appointed the main contractor to develop solution for theissue life extension of the South African Airin Force Mirage full aircraft during the late 1920saand – years of decline Aerospace F1 fleet, using the Klimov RD-33 engine. Although technically very has turned that early step and many spending and the demise challenging, the and projectDefence was completed successfully and two prototypes were extensively flight tested in South Africa. subsequent innovations into long-term of SOE’s has eroded the capacity of 2007-2012 – Aerosud became a ‘Design and Build partner’ on the Airbus and sustainable partnerships with a the network in general,” explains Steyn. A400 development project. The organisation was contracted for the Over the years, Aerosud has gained numerous real-life skills and experience across a range of business functions and systems in the innovative and competitive world of aerospace design and manufacturing. The organisation has become an internationally renowned supplier to some of the largest aircraft manufacturers globally.
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important,” says Steyn. “It has to expand into the supply chain, internal operations and manufacturing – and very often it is mandated by the customer – to be able to integrate engineering data and business processes like PLM. “Of course, it’s definitely important to implement 4IR strategies – but only if it makes sense and adds productivity to your company offering – never do it because everybody else is doing it!” The aerospace manufacturing sector is dominated by OEM and regulatory requirements and regulations. This consists of a large supply chain of over 300 international suppliers of raw materials and parts, often with single source suppliers. “We have 10 suppliers that consists of 80 percent of the spend – but even the smallest parts are important to complete a product to the customer specifications,” says Steyn. “Logistics integration and door-to-door tracking and reporting is critically important.”
Perhaps the industry most impacted by COVID-19 has been the aviation space. With flights grounded and air cargo significantly reduced, Steyn admits that the impact on firms such as Aerosud was ‘unavoidable.’ The pandemic only accelerated the adoption of new technology across the board to not just ensure business continuity but to also achieve considerable growth. “The global impact from COVID19 began with logistics disruptions, followed by the South African lockdown and dramatic rate adjustments,” he explains. “Aerosud has embarked on a strategy to diversify and develop by offering a number of digital product solutions throughout the last two years. The crisis has highlighted the need to expand and accelerate such offerings, such as MWORX which is a digital business platform for SME applications.” Looking to the future, Steyn is
optimistic about the next couple of years and stresses the importance of having a positive mindset following a challenging year. “We’re working hard to maintain current business which will require further investment by all suppliers to the OEMs,” says Steyn. “We all work hard to stay relevant in three to five years with expanded offerings and most likely with further diversification to avoid/mitigate the events of 2020. “Aerosud aims to diversify into automotive, medical and nuclear for manufacturing. We plan to expand our digital offering and business solutions for SMEs.”
AEROSUD Tel: +27 (0) 12 662 5000 info@aerosud.co.za www.aerosud.co.za
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Enabling South Africa’s world-class supply chains
GREEN RESOURCES
Sustainable and peoplecentric forestry business
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