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SIERRA LEONE History put on trial in elections

w w w.t he a f r ic a r ep o r t .c om

SOUTH AFRICA ANC boss Mantashe plans Zuma’s victoryy

AFRICAN UNION Dlamini-Zuma win marks power and policy shift

THE AFRICA REPORT

N ° 4 3 • A U G U S T- S E P T E M B E R 2 012

THE

nga Bernard Njo Samir Dilou • Michel Sidibé • Chimamanda Ngozi Adichie • Dani el Yohannes th ru Shan Rambu Zwelinzima Vavi • Acha Leke • Marc Ona ku joku jo Njoku on N ason as Jason Tartag • J ia • Nasir El-Rufai • Bachir Ta S.K. Macharia bo • S.K ki Louise Mushikiwa ngi James Mwa • e n a W im El Ghass

• Rebecca Kadaga •

Femi Otedola

MONTHLY • N°43 • AUGUST-SEPTEMBER 2012

MOST INFLUENTIAL AFRICANS

INTERNATIONAL EDITION Algeria 550 DA • Angola 600 Kwanza • Austria 4.90 € • Belgium 4.90 € • Canada 6.95 CAN$ • Denmark 60 DK • Ethiopia 75 Birr • France 4.90 € Germany 4.90 € • Ghana 5 GH¢ • Italy 4.90 € • Kenya 350 shillings • Liberia $LD 300 • Morocco 50 DH • Netherlands 4.90 € • Nigeria 600 naira Norway 60 NK • Portugal 4.90 € • Sierra Leone LE 9,000 • South Africa 30 rand (tax incl.) • Spain 4.90 € • Switzerland 9.90 FS • Tanzania 6,500 shillings Tunisia 8 DT • Uganda 9,000 shillings • UK £ 4.50 • United States US$ 6.95 • Zimbabwe US$ 4 • CFA Countries 3,500 F CFA

GROUPE JEUNE AFRIQUE

SIERRA LEONE History put on trial in elections

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SOUTH AFRICA ANC boss Mantashe plans Zuma’s victoryy

AFRICAN UNION Dlamini-Zuma win marks power and policy shift

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4 EDITORIAL South Africa in charge 6 LETTERS 8 THE QUESTION

50 THE

Samir Dilou • Michel

BRIEFING 10 SIGNPOSTS & TRENDS

Shan Ram bu

ruth

ga Bernard Njon Sidibé • Chimamand a Ngozi Adichie • Dan iel Yohannes Zwelinzima Vavi • Acha Leke • Mark Ona

MOST INFLUENTIAL AFRICANS

17 CALENDAR 18 INTERNATIONAL FRONTLINE 21 THE 50 MOST INFLUENTIAL AFRICANS POLITICS 34 African Union Power shifts south 38 South Africa Interview with Gwede Mantashe, ANC secretary general 45 Kenya Musalia Mudavadi, the vanilla candidate 48 Sudan Security now, border talks later 49 Egypt Morsi against the generals 50 Nigeria After the cash runs out 50 Ghana/Côte d’Ivoire Pouring oil on politics 51 Zimbabwe Centrifugal force 52 Anansi Doublethink in DRC COUNTRY FOCUS

Not all familiar faces, these 50 men and women include pastors, thinkers, writers, business moguls and presidential pretenders

AFRICAN UNION POWER SHIFT

Elected as the first female chair of the AU in July, South Africa’s Nkosazana Dlamini-Zuma has a brimming to-do list of crises to solve that will test her diplomatic and political skills. Her victory marks a shift of power to South Africa, but she will have to work hard to win over most of Francopone Africa

61 SIERRA LEONE THE PAST ON TRIAL

SIERRA LEONE

BUSINESS 76 82 86 88 90 92 94

102 DOSSIER LOGISTICS Truck jams; Transnet’s spending spree; a day in the life of Lomé’s Autonomous Port ART & LIFE 114 117 118 120 122

Political invective is rife ahead of November’s elections when President Bai Koroma will face a challenge from former junta head Julius Maada Bio

South-south Lessons from Singapore Hannibal East Africa’s budgets Tourism Luxury hotels to meet demand Mali Business stopped dead Libya Clawing back sovereign assets Leaders Alan Knott-Craig, Jay Ireland Finance Forex in Zambia and Uganda; Mauritius woos investors

Art The great Kenyan Art heist Fashion Kitchen glamour by Omar Victor Diop Music Spoek Mathambo’s ghostly words Lifestyle On the road in Northern Ethiopia Last Word Mahmood Salem

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SOUTH-SOUTH SINGAPORE

African leaders could do worse than to take the best of Singapore – in areas such as good governance, education and low-cost solutions – and apply them at home

This issue carries an insert between pages 34 and 35 for selected countries

BY PATRICK SMITH

South Africa in charge

istorians with a taste for dramatic detail may cite 15 July 2012 as the day when South Africa finally consolidated its leadership of the continent. It was then that Southern Africa’s candidate, Nkosazana Dlamini-Zuma, confounded both sceptics and outright opponents to be elected as the new chairperson of the African Union Commission. After the votes were announced at the AU headquarters in Addis Ababa, an elated President Jacob Zuma, Dlamini-Zuma’s ex-husband, told The Africa Report: “Southern Africa is happy but the whole of Africa is happy.” Her victory would empower women, he insisted. It will also empower Zuma’s own campaign for re-election as president of South Africa’s African National Congress in December. Uganda’s President Yoweri Museveni joined in the celebrations, telling us that Dlamini-Zuma would be an effective advocate for Africa, referring to her background as a militant in the liberation struggle: “We are used to diplomats and bureaucrats … having a freedom fighter is value-addition.” With a taste for vivid West African boubous and pan-African poets, together with a decade as her country’s foreign minister, Dlamini-Zuma is well placed to convince other states of her continental credentials. But she will have to produce results on the ground. That means ending South Africa’s reticence to offer troops and logistics for peacekeeping operations. Currently, foreign (mainly Western) states and organisations provide over 55% of the AU’s funding. As concerns grow about the independence and sustainability of the AU’s finances, South Africa and other big economies such as Nigeria, Angola and Egypt will have to boost their contributions. That will be wholly good. Higher financial contributions will mean states will take a greater interest in how the organisation is run. South Africa’s leadership of the AU Commission will also raise ideological and philosophical questions about the pan-Africanist project. Dlamini-Zuma’s ally, former South African President Thabo Mbeki, fought determinedly against Libyan leader Muammar Gaddafi’s grandiose plans for quick continental unity. How fast will Dlamini-Zuma push the continental project?

The July summit in Addis agreed to establish a continental free trade area by 2017. Without strong backing from the Commission and Africa’s bigger economies, that won’t happen. Regional organisations are asserting their authority in relation to the AU. The Inter-Governmental Authority on Development wants to lead on Somalia, and the Economic Community of West African States wants to lead on Mali – just as the Southern African Development Community wants to lead in the crises in Zimbabwe and Madagascar. Managing competing interests will test DlaminiZuma’s diplomatic acumen. Getting it wrong will risk failure as the AU seeks to boost its authority on peace and security in relation to the UN. In its first ten years, the AU’s pioneering officials worked hard to promote political pluralism, sanctions against putschists and ‘non-indifference’ towards oppression and human rights violations. Much needs to be done to monitor and evaluate these efforts. Insiders want to see much more rigour in the African peer review mechanism. Many are campaigning for the Pan-African Parliament, based in South Africa, to be given legislative power. Its election-monitoring efforts in states such as Zimbabwe have already earned more credibility than the AU or SADC’s own missions. And the prospects, it seems, have improved for a constructive relationship between the AU and the ICC now that Gambia’s Fatou Bensouda has taken over as prosecutor. As preparations start in Addis Ababa for the 50th anniversary of the founding of the Organisation of African Unity, other big states such as Algeria, Egypt and Nigeria will ponder the new configuration of power in Africa. Certainly Egypt and Nigeria, caught in their respective national political crises, were in no position to challenge South Africa for continental leadership. But Nigerian diplomats will take heart from that slogan commonly emblazoned on the bright yellow buses in Lagos: “No condition is permanent.” ●

With her taste for West African boubous and pan-African poets, DlaminiZuma is well placed to convince other states of her continental credentials

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Experience the Progress.

Liebherr-Export AG General-Guisanstrasse 14 CH-5415 Nussbaumen, Switzerland Phone: +41 56-296 1111 E-mail: info.lex@liebherr.com www.liebherr.com

The Group

To respond to this month’s Question, visit www.theafricareport.com or find The Africa Report on Facebook and post on our wall. Comments, suggestions and queries can also be sent to: The Editor, The Africa Report, 57bis Rue d’Auteuil, Paris 75016, France or editorial@theafricareport.com

WEB CONTRIBUTIONS

On 11 July, the Bill & Melinda Gates Foundation hosted a summit on family planning in London. The hosts argued family planning had taken a back seat for two decades, and needed to be put back on the agenda.

ON LAST MONTH’S QUESTION:

Can Africa beneﬁt from a Greek exit?

Does Africa need more investment in family planning?

While the argument isn’t coherent, maybe the upside for Africa is the perception of better ROI. Ufunuo via Twitter

Yes

TEWODROS MELESSE Director-General, International Planned Parenthood Federation

People often look at population growth at a macro level, but we should look at it at the family or community level. In some communities, girls get married at a very young age, their bodies are not ready for childbearing, they can develop fistula and their chances of dying are much higher. And if the young woman dies, her child is an orphan. Girls who become mothers can’t finish their secondary education; this in turn means they have less chance of finding employment. And when you have a lot of unemployment and poverty, you have political instability. Women who can’t space out their pregnancies are also at risk of complications. Africa has one of the highest rates of maternal and infant mortality in the world. We need to invest in family planning at the community level to make it accessible. There should be comprehensive information about all contraceptive methods so that women find the right option for them. And this need not be difficult: if you can get Coca-Cola in every remote village, you [should be able to] get contraceptives too. This is why we need more investment and support from the government. ●

Greece’s potential exit notwithstanding, the hefty direct economic impact of Greece on Europe would definitely spill over negatively on Africa. Europe is so intertwined with Africa through trade, workers’ reimttances and foreign direct investment. Enock Nyorekwa Kampala, Uganda The Greek exit from the Euro could be an important indicator that globalisation is coming undone at the seams. Rules that work for certain types of economic actors in big countries, like removing financial safeguards, can really devastate smaller countries. When [they] go bankrupt, globalisation will also negatively affect bigger economies. Sameera Motala Johannesburg, South Africa

No DR OBIELUMANI IDEH Catholic obstetrician Lagos, Nigeria, president of Doctors’ Health Initiative

What Africa needs is more investment in health care. Contraception is a distraction: $4.6bn was committed at the Family Planning Summit in London; imagine what you could do if you invested this money in improving health care systems as a whole. Contraception will not help reduce deaths in childbirth or infant mortality: it is just a population control tool. If we really want to support women in childbearing, we should invest in community midwives who attend pregnant women one on one and can help them access care if problems arise. The state of Ondo in Nigeria has recently been commended by the World Bank for successfully implementing this model, and they have shown that all it takes is $120 to get a woman through childbirth. We [Doctors’ Health Initiative] think there is room for debate on family planning, but it is unequivocally reserved for Natural Family Planning (NFP): Africans do not need one more pill, condom or implant to successfully plan their families. NFP teaches women and their spouses to understand their own bodies and use that knowledge to both achieve and prevent pregnancy. ● THE AFRICA REPORT

The disintegration of the Eurozone would potentially put to an end the free movement of labour across the region, thus perhaps immigrants of African descent would have an improved chance of securing jobs in European big economies, implying more remittances. Ibrahim Okumu via Facebook •

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OLAM IS HELPING AFRICA TO REALISE ITS POTENTIAL Q&A Ranveer Chauhan, Managing Director and Regional Head Q1. Can you give us an overview of OLAM’s operations in Africa? RC: Africa is at the heart of OLAM. Today we are headquartered in Singapore, but OLAM began in Africa 23 years ago sourcing cashews from Nigeria. From modest beginnings, OLAM has grown from one product to more than 20 in a global supply chain that spans over 65 countries. 24 of those countries are in Africa where we handle 4.1 million tonnes of agri-commodities each year. Today, OLAM is a leading agri-industrial business in Africa providing employment for 25,000 full-time, contract and seasonal staff. From our roots in supply chain, we are now robustly invested in upstream plantations, farming and managing forest concessions, as well as midstream processing and marketing food brands for Africa. Q2. How has OLAM grown so quickly? RC: OLAM is built on an entrepreneurial can-do attitude and culture that is strengthened by the scale at which we now operate, bringing global best practice to local situations. Our business model is based on repeatability – applying the knowledge, skills and systems from one country or supply chain and copying it in another. At the core of our operations is a commitment to unlock mutual value for

all of our stakeholders. This pioneering approach to collaboration enables us to broaden our reach through partnering with national governments, farmers and their communities, other corporations, NGO’s and donors. This support and welcome from local communities is the cornerstone of our growth in Africa, combined with alignment to the local growth agenda of progressive administrations.

Nigeria and Tanzania; wheat milling in Ghana and Nigeria and an integrated rice farming and milling operation in Nigeria. A further US $2.2 billion has been earmarked for investment in Africa by 2015.

Q3. What is OLAM’s commitment in Africa?

Q4. How is OLAM helping improve the livelihood of Africans?

RC: OLAM is strongly committed to delivering long-term value for our continuing shareholders and also being a positive force for sustainable change in the communities and countries in which we operate. We see partnerships both with the private sector and the public sector as an important pillar of this strategy. National governments have a role to play in stabilising their own food security whilst at the same time looking to create more local value-add and supplying goods to the global economy.

RC: OLAM is leading the agri-field when it comes to ideas for shared value with the communities growing and strengthening with us. The OLAM Livelihood Charter has been launched in 2011 as our commitment to improve livelihoods of small-holders in Africa and globally. We aspire to improve the well-being of 600,000 African farmers by 2020. The Charter is based on a set of principles including improved yield, interest-free finance provision, market access and social investment.

US $2.2 bILLION HAS bEEN EARMARkED FOR INVESTMENT IN AFRICA by 2015 Transparency and fairness have always been key watchwords and remain part of our commitment to long-term growth and investment. As an international corporation working in emerging economies, we have always focused strongly on good governance. To date, we have committed US $604 million to initiatives in Africa which have included state-of-the-art cashew processing plants in Côte d’Ivoire,

AFRICA IS AT THE HEART OF OLAM

LIVELIHOOD CHARTER INITIATIVES Total farmers: 212,377 Total hectares: 369,740 Finance (crop and loan): US $63.8 million Training: Invested US $4.5 million Social investment initiatives: 1,900 vaccinations, 8 literacy centres built, HIV/AIDS training provided to over 17,108 people This is an adverTisemenT

TOUCHING PEOPLE’S LIVES 24 COUNTRIES OLAM hAs OperAtiOns in 24 cOuntries in AfricA

4.1 MILLION TONNES

OLAM’s vOLuMe WAs 4.1 MiLLiOn tOnnes in AfricA LAst YeAr

1.35 MILLION FARMERS

OLAM’s sustAinAbiLitY initiAtives reAch 1.35 MiLLiOn AfricAn fArMers

Over the past 23 years we at OLAM have touched people’s lives, from the farm, to the factory, to the shelf. We provide products for food and clothing, as well as industrial raw material, and build lasting partnerships along the way. With 17,000 staff supplying the needs of 11,600 customers worldwide, we know we couldn’t do it alone. OLAMONLINE.COM

PIONEERING COLLABORATION

SOUTH-SOUTH

Driven by Singapore Doing what they do best, Singaporean companies and government institutions are bringing training and commercial opportunities to their African partners

EDUCAT IO N

By Nicholas Norbrook in Singapore

The Singapore-Africa relationship is not new, but much of it is happening under the radar of the respective national authorities. The Singaporean high commissioner to Nigeria, Shabbir Hassanbhai, explains that he was surprised to learn about a Singaporean company with offices in Nigeria that imports auto parts and has a turnover of $2m per month. “We would never have even known about them if they hadn’t ap-

V; FOURNIER/JA; FOTOLIA

“

ou would be surprised how many leaders of Africa tell us they want their country to become the Singapore of Africa!” says Singapore’s minister of state for foreign affairs, Masagos Zulkifli. The entrepot state of Singapore has always been tied to the fortunes of global trade. So, when US investmentbankLehmanBrothers collapsed in 2008 and sparked a downturn, the Singaporean manufacturing base started to suffer. This contributed to a hunt for a high-growth part of the world decoupled from the malaise hitting the US and affecting Asia. That destination was Africa. “Since 2010, there have been many more trade missions to Africa,” explains Lim Ban Hoe, regional director for trade promotion body International Enterprise Singapore. Singapore-Africa trade jumped from $9bn in 2009 to nearly $14bn in 2011.

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COMPANIES & MARKETS

TIO N S

With its expertise in the building blocks of development – better governance, enhanced education and productive agribusiness – Singapore may hold lessons for African leaders seeking low-cost but efficient ways to drive their countries’ development and lead them towards industrialisation

F O-

BUSINES

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proached us to help with a payterranean Terminal, Portek has ment issue,” says Hassanbhai. doubled the throughput of freight The Africa Report has been looktraffic from 40,000 to 80,000 coning at the Singaporean companies tainers per year at a fraction of active in Africa throughout this the cost of a large port operator such as Bolloré. It is also manyear. Singapore, like many Asian aging an inland port in Rwanda countries, is clearly interested in Africa. “Singapore cannot arrive and installed two mobile cranes with $5bn in financing like China’s at Gabon’s Owendo port in April. Exim Bank,” reminds Hassanbhai. Singapore will not be working on MOVING UP THE VALUE CHAIN the infrastructure-for-resources Singapore is also helping African premise that underpins the Sinocountries towards industrialisaAfrican relationship. However, tion, with the ultimate goal of Singapore can deliver expertise moving away from the relentless for improving governance, proexport of raw commodities. In cess management and the use 1957, when Ghana’s President of technology. If African policy Kwame Nkrumah attempted to makers use Singaporean interest steer the country onto a modern effectively, they could help their economic trajectory, the governeconomies to make the transition ment largely ignored the farming from agriculture to agribusiness, sector. Recent examples of industo light manufacturing and industrialisation – from China to India to trialisation. In this way, these soft Vietnam–revealtheimportanceof improvements are a match for the parlaying the capital earned from hard infrastructure provided by agriculture into agribusiness and then into light manufacturing and Chinese companies. Singapore also provides some up the value chain. typical ‘South-South’ benefits to its diploThe goal: industrialisation, matic and trade partand the move away from ners. For example, several of its companies the relentless export offerlow-costproducts of Africa’s raw materials to African consumers. Kheng Keng Auto exCompanies like Olam and ports cars from Singapore and Japan, countries that have strict Tolaram are moving in that direction. Dufil Prima Foods, a Tolaram age limits for cars on the road. “The demand in Africa is huge, we subsidiary, opened a factory in can’t meet it,” says sales director Kaduna earlier this year, giving the Leo Tan. He says that the comlie to investor panic over northern pany sells about 200 cars per Nigeria (see TAR 41, June 2012). monthonthecontinent,the Sourcing many ingredients locaverage age of which is four ally, it will produce 200,000tn of or five years old. noodles in 2012. The company Beyond inexpensive cars, many is also building a wheat mill in African countries need betPort Harcourt. ter ports to unleash their Whereas the majority of Africa’s own export potential. cashews are sent to India for proPortek upgraded Algeria’s cessing, Olam is opening four port of Bejaia and now mancashew processing factories across ages two container terminCôte d’Ivoire, Ghana and Nigeria. als there after signing a deal with This will bring Africa’s processing the port’s management in August capacity to more than 125,000tn 2004. By buying two mothballed per year. The Singaporean agcranes from the port of Baltimore ribusiness is also opening a $60m in the US and re-engineering them wheat mill in Ghana and a tomato to fit the needs of the Bejaia Mediprocessing plant in Nigeria, where

FOTOLIA

BUSINESS | COMPANIES & MARKETS

TS R

RIGH

FRANCIS CHONG, the director for emerging markets at the ministry of trade and industry, fears “the title of the autobiography of independence leader Lee Lee Kuan Kuan Yew [pictured right] – From Third World to Yew First – may be a bit misleading.” From the mid-19th century until independence in 1963, the young, talented ted and ambitious would head for Singapore, the headquarters off the British empire in Asia and a locus of banks, universities and administration. tration. This legacy left the high-quality infrastructure and human capital that were essential for Singapore’s growth, a base that not every country enjoys. Even allowing for this, the change is jaw-dropping. Singapore’s GDP in 2011 was $240bn, with GDP per capita having increased 80 times since independence. It is the world’s third-largest oil refiner, controls 75% of the global market in manufacturing jack-up oil rigs and is the fourth-largest currency trading centre in the world. It is the easiest place to do business according to the World Bank and has the world’s largest transhipment port. The government has spun off solutions to urbanisation problems into successful companies such as NEWater, a widely admired public-private partnership. Beyond hard business metrics, there has been a great deal of social effort, too. The civil service has fought corruption with fairer salaries. Policies that forced different communities to live together, not in ethnic enclaves, has reduced the tensions between Malay, Chinese and Indians. And subsidised home ownership has given everyone a stake in Singapore. ● N.N.

ESER VED

A MARCH TO MODERNITY

ALL

it is already processing cocoa. Its other projects include cocoa processing in Côte d’Ivoire (see TAR39, April 2012) and a $1.7bn fertiliser plant in Gabon. In his book Unfair Trade, Conor Woodman heaps some rare praise on Olam’s work in stimulating cotton production in northern Côte d’Ivoire, citing the higher prices that benefit farmers. That is not to say that the company should be given a free pass – in 2007 the International Finance Corporation divested from Olam over a logging scandal in the Democratic Republic of Congo. But given how Olam has sought to change, it does suggest governance structures

within Singapore companies are more solid than in, for example, Chinese companies. “Today, we own the largest contiguous Forest Stewardship Council-certified concession of natural forest in the world. Almost 1.4m ha in Congo is FSC certified”, says Olam chief executive, Sunny Verghese. Boosting production and fostering local transformation are just the starting points of this journey. Both companies are planning or building special economic zones (SEZ) – areas free of red tape, which provide quality infrastructure that manufacturing companies can use with ease, something Singapore

Getting the skills to compete in Africa’s next economic chapter is a major theme of this year’s

AFRICA CEO FORUM GENEVA, 19-21 NOVEMBER

has done before. “Actually, we helped China build one of its first industrial parks,” says Lee Yi Shyan, minister of state for trade and industry. Tolaram’s SEZ in Nigeria is dependent on a final investment decision for a new port, which should be approved later in 2012, allowing construction work on the multipurpose zone to begin in 2013. CALL FOR ACTION

Ranveer Chauhan, Olam’s regional re head for Africa, explains that African leaders play pl a crucial role in this development dynamic and that it was me the decision by the Gabonese government to ban the export gove of u unprocessed logs that pushed Olam to invest in an SEZ at Nkok that focuses on timber processing. Olam controls a 60% stake, while the go government holds the remaining 40 40%. Construction of the site is not yet complete and it already has a 80% tenancy rate. Meanwhile, the government of Côte d’Ivoire has asked Agritech Group to set up an agribusiness training facility in the country. Just as Bengali factory owners copied the Indian textile manufacturers who set up shop in Bangladesh, African entrepreneurs will imitate and one day outstrip Singaporean processors, as long as African governments support them in their endeavours. Nothing is more complementary to infrastructure in a country’s development than education. Everyfiveyears,administratorsand teachers rewrite Singapore’s educational syllabus in concert with leading members of the private sector. This is an attempt to project Singapore’s economy into the future and ask what skills graduates will need in 15 to 20 years. Singapore’s science and maths teaching is rated as among the best in the world. The government spends just 3.3% of gross domestic product (GDP) on education each year – the UK, for example, spends twice that – but still outperforms European countries. Singapore is also focusing on the balance of tertiary training.“Of the 40,000 babies born each year, 25% will ● ● ● N° 43

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BUSINESS | COMPANIES & MARKETS

● ● ● go to university, 60% will get technical education and 15% will have trade certificates,” says Masagos. Every year, Nigeria imports about S$10m ($7.9m) worth oftextbooksfrom Singapore-based Marshall Cavendish. This pursuit of excellence via education is replicated in the civil service. To walk inside the gleaming Civil Service College (CSC) is to peer under the hood of Singapore’s efficient governance. Just like with the education programme, the CSC does regular surveys of what the government needs. Training budgets are decentralised to the ministries and various government agencies. Each civil servant has to undertake 100 hours of training per year, with 60% focused on his job and 40% on whatever interests him, reminiscent of Google’s rule that employees can spend one day per week on personal projects. Civil servants regularly change posts “in order to keep ideas and people fresh,” says Tina Tan, director of the CSC.

GETTING GOOD GOVERNANCE

A reactive, high-performance civil service is the instrument through which elected leaders deliver political, social and economic goods. The Singaporean government wants to share its experience. Some development challenges, such as urbanisation,

Singaporean companies active in Africa COMCRAFT GROUP Manufactures steel, plastic and aluminium products across East Africa JURONG CONSULTANTS Designed a 300ha industrial park for the oil sector in Delta State, Nigeria SHANKAR’S EMPORIUM Distributes, services and markets Sony products in Angola HYFLUX Won the bid to build the world’s largest reverse-osmosis desalination plant, located in Algeria, in 2008 WILMAR A global leader in agro-industrial projects, with palm oil, rubber, cotton, sugar and other interests across Africa require cross-ministerial collaboration. So in a project sponsored in conjunction with the Commonwealth Secretariat, the CSC has created a study programme for ministerial permanent secretaries, with a focus on Botswana, Namibia and Mauritius. “We realised that many of these permanent secretaries had never met one another socially before,” explains Flynn Ong, who ran a team-building course for Botswana’s high-ranking civil servants. “But after this weekend, they had all exchanged cell phone

numbers with each other and had built up a rapport which hopefully will carry over into their professional lives.” Singapore has a role to play in e-government, too, something that countries like Ghana are already using to their advantage. In the 1980s, Singapore’s ports were congested, corrupt and inefficient. Importers required a piece of paper with two dozen official stamps to clear a cargo, a process that could take up to two weeks. After the innovative TradeNet platform was launched in 1988, all the relevant agencies used one electronic document. “Nowadays, pre-registered Malaysian trucks barrelling towards our border posts loaded with fruit send off their request on a smartphone while they are en route and get their licence in under a second,” says CrimsonLogic chief executive Leong Peng Kiong. CrimsonLogic, the company licensed to sell the software, is now recording tens of millions of dollars in revenue in Africa. CrimsonLogic software is in use in Ghana, where GCNet is the reason goods now clear Ghana’s ports in record time. Mauritius Network Services is another customer and Congo-Brazzville’s President Denis Sassou-Nguesso expressed interest in setting up ●●● a similar deal this year.

ADVERTORIAL

FOR INQUIRIES PLEASE CONTACT:

ALUZINC ASIA PTE LTD One George Street #21-06 Singapore 049145 Tel: (65) 6491 1354 Email: info@aluzinc-asia.com www.aluzinc-asia.com

affordable building materials to consumers, Aluzinc Asia has established itself as a front-runner in several markets across the continent. Established in 2007, Aluzinc Asia currently has direct business activities in 40 countries globally. Having started business activities in Africa in 2008 the ﬁrm is now present in 19 countries across the continent with key markets in Senegal, Guinea, Ivory Coast, Ghana, Nigeria, Mozambique and Rwanda. The company has plans to further expand into South Africa, Ethiopia, the Democratic Republic of Congo and North Africa. As Africa rapidly develops the need for sustainable housing has become more prevalent. Aluzinc Asia prides itself on not only making this provision but also in its ability to help their customers generate wealth and create local job opportunities. The company has successfully developed relationships in its key markets across the continent where they have become a preferred supply chain partner. In the last four years, Aluzinc Asia has aimed to meet each of its customer needs by providing superior products whilst ensuring they are made most affordable.

Now that Aluzinc Asia has positioned itself as a market leader in many countries in Africa, the company believes its credibility will pave the way to work with development banks, government and non-government agencies in a move to promote innovative concepts in roofing in some of its key markets. As part of its business model Aluzinc Asia works closely with local banks to get a full understanding of the varying economic trends on the continent that can lead to the depreciation of some currencies. In order to help hedge their clients against these risks the firm continually investigates into new ways to protect their customers against potential uncertainty. Aluzinc Asia has experienced good growth since its inception and in 2011 recorded an annual turnover of $75mn and would go past $150mn in 2012. The company expects to increase this amount by 50-70% annually over the next few years. Having focused its efforts on flat steel products, Aluzinc Asia has been able to set itself apart its competition by offering their clients high quality roofing products at affordable prices in a bid to establish a better quality of housing for all.

DIFCOM/DF - PHOTOS: UNLESS OTHERWISE MENTIONED.

luzinc Asia is a joint venture company between the multinational Comcraft group and the 160 year old Japanese trading company, Sadoshima Corpartion. Based in Singapore, the global trading company specialises in supply chain management and boasts a portfolio of flat steel products as well as raw materials for steel making. The company’s mission is to provide superior roofing construction products and solutions to markets in Africa, Asia and South America from factories in developed countries. Aluzinc Asia’s highly professional management team have over 50 years of experience in business trading between them, having spent time working in management, sales and finance in Singapore, India and Japan. Aluzinc Asia saw the move into Africa as a chance to be part of the transition process from traditional thatched roofs to more efficient steel roofs. “We see this as an opportunity to positively impact the lives of the end client.” Commented Aluzinc Asia’s President Rajesh Balasubramanian. With the objective of providing quality

Aluzinc Asia: Providing quality rooﬁng for quality living

BUSINESS

●●● E-government doesn’t just mean better ports. Up to 1991, Singapore had a backlog of over 2,000 cases in its courts, some of which could take up to seven years to clear. Cases are now heard within 30 days. CrimsonLogic is now installing an e-judiciary system in the Namibian capital, Windhoek, as well as in Mauritius. Singapore’s IDA International is helping Kenya’s government improve its e-governance.

DEVELOPMENTAL AUTHORITY

Getting the most out of Singapore will not be easy. The ‘developmental authoritarianism’ that allows the city-state to get things done is not an easy fit to Africa, though Ethiopia’s Premier Meles Zenawi and Rwanda’s President Paul Kagame are certainly trying. Though Singapore is keen to promote itself as a base for African countries to enter Southeast Asian markets, there are only a handful that have the ambition and ability to do so, outside, for example, Dangote Group and Sasol. Africa also needs to be wary of the capital flight that is conducted through Singapore-registered shell companies. “We don’t want to be known as a place where illicit flows transit”, says Masagos. “Yes, there probably are nameplate companies. But if we get any complaints we will investigate, and we are signatory to all of the anti-money-laundering agreements.” There is no guarantee that Singaporean companies will continue to be attracted to Africa. One hindrance to their expansion outside Southeast Asia is the opening up of Myanmar. A free trade agreement between the Association of Southeast Asian Nations and an African regional economic community like the East African Community may be on the cards, as will the potential opening up of Singapore Airlines’ second Africa route, to Abuja, in 2013. These are surmountable obstacles. Taking the best of Singapore and applying it at home to improve governance and kickstart industrialisation is no small prize for African leaders. ●

A debt burden to develop East Africa

f there were any fears that East Africa’s economic mandarins – still stinging from a year of financial tumult – would return to a regime of fiscal caution to curb inflation and limit the effects of last year’s spikes in food and oil prices, they were decisively dispelled when the East African Community’s (EAC) five finance ministers delivered their budgets in June. Reading his maiden budget in Kenya, Robinson Githae announced an increase in government spending of almost 25%. In Uganda, which experienced its slowest growth rate in 25 years, Maria Kiwanuka planned to raise spending by 12%. In Tanzania, newly appointed finWith the ance minister William Mgimwa said that return to the government would seek $1bn from the higher debt domestic markets, increasing government borrowing by a third on last year. levels, the The return to higher debt levels in the narrative EAC is one of the dividends of a decade of sustained growth. The region’s collective of austerity gross domestic product has grown from and donor $32bn in 2000 to $79bn in 2010. The narconditionality rative of austerity and donor conditionality is fast being replaced by the ambitions of is fast being a revived developmentalist state. replaced by East Africa’s economic planners are exploring new financial instruments as they the ambitions seek long-term financing for a growing of a revived list of projects. Slow to mature and with far more manageable interest payments, developmeninfrastructure bonds, syndicated loans and talist state one-on-one negotiations with Brazil, India and China are increasingly seen as easier than negotiations with the World Bank. The optimism of policy-makers is being fuelled, in part, by the anticipation of a resource bonanza. Uganda will soon begin production from its oilfields in the north west; Kenya just discovered substantial reserves in Turkana and is talking to Chinese investors about the coal reserves in the east; and the Tanzanian government is counting on revenue from huge gas reserves in Songa Songa. Debt accrued today, it appears, will be paid for with petrodollars tomorrow. If there are any alarm bells sounding, it should be for the fact that the hosannas of prosperity are being sung by an elite that is now reaping the proceeds of the era of privatisation. It is to their factories, their formerly government-owned farms and their new apartments that the recently built roads connect. For them, East African integration and the arrival of the Chinese are a gift of manna. For the Lazaruses sitting outside the formal economy, there are few ready solutions. ● THE AFRICA REPORT

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Very proud to be the largest exporter of iron ore in West Africa, from the Tonkolili Iron Ore Project, Sierra Leone, with fully integrated and dedicated mine, rail and port.

For more information: +44 20 3435 7600 www.african-minerals.com

BUSINESS | COMPANIES & MARKETS

Lounge design for a chain of Nigerian boutique hotels under construction in a Mantis/Grand Towers partnership

PROTEA HOTEL

TOURISM

Luxury hotels meet market demand African groups are competing with international chains as the continent’s economic growth, improved stablity and ease of travel boost demand for high-end business and leisure hotel rooms

ood news for the inn-keepers: tourism arrivals to Africa nearly doubled between 2003 and 2010, from 37m to 63m, with international receipts reaching $44bn in 2010 alone. In 2011, sub-Saharan Africa saw the biggest growth, with international arrivals up by 7% (United Nations World Tourism Organisation Barometer). “Never before has the continent offered so much in terms of political stability and economic growth,” comments Arthur Gillis, CEO of South African Protea Hospitality Group. As a result, new opportunities in the hotel sector have revitalised international

chains; they have also encouraged local entrepreneurs who are keen to break into the high-end boutique hotel market. According to W Hospitality Group, a Lagos-based consultancy, sub-Saharan Africa (excluding South Africa)’s 54,600 rooms operated by international hotel chains are set to increase by 42% this year. Nigeria has almost 7,000 rooms under contract, the group says – up 2,000 on last year’s figures. W Hospitality Group’s figures do not include South Africa which, with a hospitality industry that’s been highly developed for several decades, is “a completely different market,

a different world”, according to Trevor Ward, the group’s CEO. Protea recently announced a $130m investment in Nigeria, Uganda and Zambia, which is among the biggest projects planned for 2012. Geneva-based Kempinski has made similar investments. It will open properties in Ghana, Kenya and Angola this year, with five more in the pipeline. Kempinski’s announcement in mid-June about the opening of its tented facility in the Masai Mara game reserve in Kenya pitches it against local luxury accommodation experts like the Heritage Group, which has been operating in East Africa for three decades. African groups are showing remarkable tenacity despite tough competition from international chains. This year, a multimilliondollar investment deal between Nigeria’s Grand Towers and South Africa’s Mantis Collection saw the latter agreeing to manage a string of boutique hotels in Nigeria, the leading country for hotel development on the continent in 2012. HOME-GROWN SUCCESS

$130m invested by Protea Hotels in sub-Saharan expansion, representing the largest hospitality investment in 2012

Three other African chains appear on both the Top 10 Brands and the Top 10 Chains (by number of planned hotels and rooms) compiled by W Hospitality and released this year. Protea, Azalai and Onomo Hotels sit with leading groups such as Accor, Radisson Blu, Mövenpick, Hilton, Park Inn, Intercontinental, Kempinski and Starwood. International groups are coming off better in the fight worldwide, as they are “endowed with immediate brand recognition and therefore a higher attractability,” says Vincent Guérin, Starwood hotel group’s head of sales and

• MINING Nigeria’s Supreme Court has ruled illegal the sale of the Aluminium Smelter Co. of El Hachef viaduct for 1.31bn dirhams ($147m) • AGRIBUSINESS South Africa’s Tiger Brands has agreed to buy 63.35% Saviour Kasukuwere’s call for foreign banks to divest 51% of their ownership by July 2013 • TELECOMS South Africa’s TICKER TAPE

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COMPANIES & MARKETS | BUSINESS

marketing for French Polynesia. Domestic groups such as Heritage in East Africa and Azalai in Francophone West Africa are vulnerable to competition from international brands, which can leverage “their longstanding policies and procedures of how to run a hotel, their experienced management, their sales and marketing strategies, and more importantly, their distribution channels,” says Ward. Another strength for international companies, according to Guérin, is that they run franchises, “which tends to ease headaches in the areas of property management, asset review and occupancy

42% increase in the number of hotel rooms run by international chains in sub-Saharan Africa projected for 2012

rates”. In Africa, as in many parts of the world, there has been a split between ownership and management, thus global chains now own little real estate. “Sometimes there are four parties split in a single deal: the land owner, the asset owner, the management company and the brand.” South Africa’s Southern Sun hotel group and Johannesburg airport’s Intercontinental hotel use this model. Things can be done to help local groups survive the competition. “African governments need to support us, and build up both the infrastructure – roads, airports – but also the necessary schools to train staff”, says Azalai Group’s commer-

cial and marketing director, Olga Sanvee. “And as the investments in this sector are so big, we should be looking at tax breaks.” Both international and local brands agree the boom has been underpinned by the opening of more direct international and intracontinental flights, which has energised a host of airlines to enter the African market. This is a far cry from a few years back, when a trip from Nairobi to Accra required a connecting flight in the United Kingdom. “Direct African flights have changed everything,” says Dunwell Eku, senior partner at ACME Consulting in Ghana. ● Prince Ofori-Atta

INDEPENDENT HOTELIERS INSIST ON GOING IT ALONE As a result, independent boutique hotels are starting to appear, particularly in Ghana and Nigeria. “The concept is catching on fast,” says Meares. Alvaro suggests that “local developers or hoteliers who do not want to join forces with an international group can pool their resources and create a consortium, or join one, like France-based Relais & Chateaux.” For W Hospitality’s CEO, Trevor Ward, “Nothing stops those with the right quality from joining luxury hotel consortia. But local competitors tend to think they are sworn enemies. The market will have to be more mature for people to understand the P. O-A. benefits of cooperation.” ●

The Nelson Mandela suite is one of 14 individually decorated themed suites at the Villa Monticello in Accra

Nigeria to Russian miner Rusal • INFRASTRUCTURE Morocco’s ONCF has chosen local group SGTM to build the of Nigeria’s Dangote Flour Mills • BANKING Zimbabwe’s central bank governor and finance minister have rejected MTN moved to dismiss a $4.2bn law suit lodged by Turkey’s Turkcell accusing the company of bribing officials in Iran THE AFRICA REPORT

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WWW.ALESSANDROCOSTA.COM

MANY LOCAL ENTREPRENEURS in sub-Saharan Africa have avoided the lure of management or franchise deals with international groups and have chosen to remain independent. “There is not much cooperation, because everyone is trying to grab a share of the market,” Charles Meares, general manager of Villa Monticello, one of Ghana’s premier independent boutique hotels, tells The Africa Report. But with stiff competition from international groups that are better able to inject capital into projects, remaining totally independent makes little business sense. “If you are an independent hotelier, chances are you won’t have the funds to carry out your own research to meet the demands of whatever niche market you are involved in, or even compete with the big chains,” says Al Alvaro, a Paris-based hospitality expert. To survive in a tough market, local hotels can stand out by offering a specialised experience such as cuisine, art or ecology. These are “concepts that big groups generally shy away from due to their high maintenance demands,” says Meares. He also argues that independent hoteliers now have access to distribution channels once controlled by groups or chains. “The internet has been very resourceful in the area of reservations and marketing.”

BUSINESS | COMPANIES & MARKETS

MALI

Stopped dead

ISSOUF SANOGO/AFP

Since the 22 March coup and rebel advance in the north, Mali has spiralled into a political and economic crisis. Good growth projections have been replaced by great uncertainty among business leaders

he Malian economy was set to take off this year. The African Development Bank predicted GPD growth of 3.5% in 2012 and 5.1% in 2013. The IMF was even more optimistic, predicting 6% and 5.8% growth. Neither of them will be proved correct. The latest estimates from the Bretton Woods institutions now foresee a drop in GDP by as much as 5%. Mali’s attractiveness as an investment location was already hurt by rebel attacks in the north, but the 22 March coup that overthrew President Amadou Toumani Touré made the situation even more fragile (see page 10). The country’s development partners were set to provide almost 40% of the national budget – which totalled 1.3trn CFA francs ($2.4bn) in 2012 – but abruptly shut off the taps. “We will have a loss of internal resources [fiscal and customs revenue] of 78bn CFA francs because of the crisis,” said finance minister Tiéna Coulibaly. Bamako is cutting spending in identical proportions and people are beginning to question the state’s ability to pay

salaries. “Salaries, student scholarships, health and security will not be touched by the reduction in spending. It will be above all administrative budgets and public investment that will be affected,” assured Coulibaly. TIMBUKTU’S DEATH KNELL

A Bamako-based manager of a multinational corporation said some 1.5trn CFA francs in investments have been frozen since the start of the crisis. The 21bn CFA franc extension of Bamako airport stopped in its tracks after the Millennium Challenge Corporation, the US government aid programme, withdrew. So, too, has South Africa’s Illovo Sugar, which planned to build a factory at Markala and turn Mali into an exporter of sugar with an annual production of 190,000tn per year. The situation is even more disastrous for tourism. The sector contributes between 10 and 15% of GDP and hosted as many as 85,000 tourists a year four or five years ago. Business has been at a standstill ever since Mali entered

Malians queueing for petrol during ECOWAS sanctions in April; now the country is grinding to a halt

FROM GROWTH TO RECESSION GDP growth predicted by the IMF in 2012 …

… in January

+6% … in June

–5%

the red zone, said one director of a network of tourism agencies. “The destruction of tourist sites in Timbuktu has sounded the death knell,” he said. Trade prospects are less sombre. The government has dropped customs duties to fight against the rise in price of imported goods, a measure that has been praised just ahead of Ramadan. However, it is difficult to get bank loans for trade finance. “We were about to obtain the agreement of the Banque Ouest-Africaine de Développement for3.8bnCFAfrancsinfinancefora rice processing plant. But after the coup, the bank determined that it was wiser to delay the investment,” says Houd Baby, chief executive of Les Moulins du Sahel. Added to this is the division of the country into two zones, which means that some companies have lost part of their market. That is the case for agribusiness Famab-SMO, for which the north was “the main zone for sales” of feed for livestock. In the north, the company sold “a tonne at 140,000 CFA francs versus 100,000 CFA francs in the south”, according to its director Daouda Touré. In a climate of generalised uncertainty, only the mining sector is staying the course. South Africa’s AngloGold Ashanti has seen the life of its gold mine at Sadiola, the second biggest in the country, prolonged by 12 years, which should bring an additional 200bn CFA francs to the state. “It is evident that there are problems in the north, with the drama of population displacement, but in the regions where we are present, in the west and south, there are not any major risks,” explains Mark Bristow, CEO of South Africa’s Randgold Resources, the country’s top employer with 6,000 workers. Randgold, which generates 70% of its production from Mali, paid between 50bn and 65bn CFA francs to the state in 2011. That should continue this year. While the economy waits for the return of donors, it will base much of its strength on its golden resources. ● Stéphane Ballong, Malika Groga-Bada and Christophe Le Bec

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BUSINESS | COMPANIES & MARKETS

LAP Green is asking for $480m in compensation after Zambia seized a 75% stake in Zamtel

ATELJEE

LIBYA

Clawing back sovereign assets While the Libyan Investment Authority has been preoccupied with fighting seizures and losses in Europe, several African governments have taken a swipe at telecoms assets, with mixed success

s the one-yearanniversary of the fall of Tripoli approaches, the Libyan Investment Authority (LIA), Libya’s sovereign-wealth fund, is still picking through the recovery of assets frozen during the revolution. The LIA is now also investigating losses that have come to light, including $1.95bn at the hands of investments made with Goldman Sachs and Société Générale in 2007 and 2008. A spokeswoman told The Africa Report that the issues needed further discussion by the board, while they were considering which law firm would best represent them in efforts to get compensation.

OIL

Mohsen Derregia, a former professor at Nottingham University, was appointed the LIA’s new chairman in April. In June, he was in Milan, fighting the seizure in late March by Italian financial police of $1.39bn of Libyan assets on the grounds they belonged to Gaddafi’s family. These include small stakes in UniCredit Bank, Fiat, Juventus Football Club and oil and gas giant Eni. Nevertheless, Derregia told reporters that LIA assets had fallen “by less than feared” and now stood at between $50bn and $60bn. In Africa, Libya is also trying to recover and rationalise its investments. At the beginning of 2011, LAP Green Networks, a

Tamoil East Africa, part of Libya Africa Investment Porfolio (LAP), won a bid to construct the Eldoret-Kampala pipeline in 2006, and another in 2008 to extend it as far as Kigali. In August 2011, the Ugandan and Rwandan governments resolved to terminate the contract for slow progress. The project is now open to new partners. Tamoil had spent more than $15m.

HOTELS

$50bn Conservative estimate of the current value of Libya’s sovereign wealth fund

The Libyan Arab African Investment Company owns two luxury hotels in Gambia, Jerma Beach on the coast of Kololi and the Laico Atlantic Hotel in Banjul. On 5 March, the Gambia Supreme Court unfroze Libyan assets in the country.

subsidiary of LIA, held stakes in nine telecoms operators across sub-Saharan Africa, including Chad’s Sotel Tchad, Oricel in Côte d’Ivoire and Gemtel Telecom in South Sudan. Some African governments have taken advantage of the uncertainty to take control. On 2 May, Niger’s parliament voted to nationalise telecoms asset Sonitel, pulling back from a privatisation agreement to sell a 51% stake to LAP Green for $62.16m. In January, Zambia’s President Michael Sata seized a 75% stake in telecoms company Zamtel that LAP Green had purchased for $257m during a privatisation in 2010. LAP Green is challenging the government’s actions in court and asking for $480m in compensation. Libya has had mixed success in Uganda. On 25 May, LAP Green’s $200m investment in Uganda Telecom was returned to the control of Libyan subsidiary UCOM, with chairmanWafikAl-Shateracknowledging the support of President Yoweri Museveni in recovering the company’s 69% stake. Other debts in Uganda are keeping asset recovery in limbo, such as the 49% stake in the National Housing and Construction Company, controlled by the Libyan Arab Foreign Investment Company (LAFICO). In February, a court ruled in favour of Ugandan MP and businessman Hajji Mohamed Mbabaali, who claimed the Libyan investors owed him $9.5m. The ruling prohibited LAFICO from transferring or receiving dividends from its shareholding. ● Pietro Musilli

BANKING

On 6 March Uganda’s central bank returned 99.7% control of Tropical Bank to Libyan Foreign Bank. Bank of Uganda had taken control of the bank in March 2011 following the UN assets freeze. But in April, it posted a $250,000 loss for 2011, announcing a 49% drop in deposits.

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BUSINESS | LEADERS

INTERVIEW

ALAN KNOTT-CRAIG JR CEO of Mxit

Word of mouth brings the message to millions In September 2011, Alan Knott-Craig Jr’s World of Avatar bought 100% of South African messaging platform Mxit, and he became its CEO. Ten months on, he explains how he’s wooing app developers and expanding in Syria TAR: How has Mxit performed since you took charge? ALAN KNOTTCRAIG JR : It’s binary. We’re either going to be a very big mushroom cloud that you can see from space – in other words, a disaster – or we’re going to take over the world. Right now it feels like we’re going to take over the world. How many countries is Mxit in? A hundred and twenty six. We’re adding about 35,000 new customers a day and we’re not marketing. It’s just word of mouth. We’re doing about 700800m messages a day … over 20bn a month. Twitter does a third of that. My users only have one thing, a phone, and they only use Mxit. All those hours people spread out over other devices in the West are consumed entirely within Mxit; that’s why it’s so much more engaged. The only limitations to our growth relate to the number of handsets in a country and whether the operators are enabled for data.

it’s difficult to phone them. Our biggest countries outside of South Africa are the UK, Indonesia – where we’ve got about 2.5 million users – and Mexico with just over 1 million. Is the smartphone relevant to your growth? I would say less than 1% use smartphones, as defined by Android, iPhone or Windows phone. I don’t think of BlackBerry as a smartphone … if you include BlackBerry, it’s probably 3%. Everything else is feature phones and dumb phones. I like the smartphone because it takes everybody’s eye off the ball. Everyone keeps developing for Android and for iPhone; meanwhile 80-90% of phones being sold on the continent right now are not Android or iPhone, they’re feature phones. One of the key things about Mxit is that it’s a handset-agnostic social network. Where we fall flat is that it’s a pretty mediocre experience when you try to use it on an iPhone, so we do lose customers as they and their friends move on to nicer phones.

“We’re doing 700-800m messages a day. Twitter does a third of that” Are you expanding into other countries? It’s random. We’ve got a lot of customers in Syria at the moment. The Syrian governmentshutdownTwitter,Facebook and What’s App. Everyone’s jumping onto Mxit, and the Syrian government can’t really phone my company, because

HETTY ZANTMAN/FINANCIAL MAIL/GALLO IMAGES/GETTY IMAGES

What agreements do you have with developers? [Since 30 March] we pay a revenue share to content partners of about 70%. We have a virtual currency called Moola. Anybody can develop for the platform. You can come up with a service, like a motivational quote a day, or a soccer player or a dating game. A lot of guys are starting to make money from it. This is an entry point for aspiring entrepreneurs, because we create a platform that gets

to the majority of people in the market and they get a decent revenue share. We’ve had over 100 or so people sign up for the [Mxit] API. Over 56 apps have been developed [by early May]. We’ve already published about 10 or so. Two guys in Cape Town wrote a little dating app called Judge Me. It’s 75 days old. They’ve got 1.2 million users. They’ve had over 250,000 uploads, and we will pay them a revenue share this month of about $8,000. How many countries does Moola work in? One Moola is one South African cent. We only have Moola working in Namibia, South Africa, Swaziland, Kenya and Lesotho. We’ve got to accelerate. A lot of the time you’re held back by the operators, because if they don’t have premium-rated SMS you can’t have any kind of operator billing. Is content your main revenue source? No, about 70% is from content and about 30% is advertising. [That] is going to grow, guaranteed. [Though] I hope it doesn’t, because I want to build the business around selling content rather than selling data. I don’t want to be Facebook. They’re compromised. The only way they’ll ever grow revenue is to sell even more of your information to somebody you don’t know without your consent. Our business model is all about being open, honest and frank. The irony is, in America people expect everything for free. Here, they don’t mind paying. ●

THE AFRICA REPORT

Interview by Gemma Ware in Addis Ababa

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PROFILE

General Electric top brass moves in

As president and CEO of GE Africa, Jay Ireland is the first senior manager to be based on the continent. He says the company will grow by being flexible

year into his job, General Electric’s Africa chief executive Jay Ireland says growth will come from all sectors – from locomotives, gas, power generation and healthcare. Nine new hospitals in Ghana will be using General Electric (GE) technology, and the company is also eyeing the opportunities presented by oil and gas finds in East Africa. Ireland says GE is “open for business” when it comes to pipeline projects in Uganda and South Sudan.

With his asset management background, Jay Ireland is keen to get handson with the financing side of deals

the national airline RwandAir to buy two Boeing airplanes. GE is also assembling diesel locomotives through a partnership with South Africa’s logistics parastatal Transnet in Pretoria. The venture delivered its first train in January. “The model that we have in the Transnet partnership is one we’d like to replicate around Africa where it makes sense,” says Ireland. “We’re hoping to get up to 65% local content of what we do in locomotives and look at that in other areas.” GE is also pushing to set up more service shops for its equipment,suchasthoseitalready has in Nigeria and Angola. ● Gemma Ware in Addis Ababa

focus on emerging markets. “Sixty per cent of our sales are outside the United States, even though we’re a US company,” says Ireland, but he admits that only 1% – or $1.8bn – of the company’s revenue comes from Africa. Ireland says that as an equipment supplier, GE is in the middle of the debate over whether there is plenty of financing but no bankable projects, or plenty of projects but no finance, in Africa. “Some people think Africa’s too risky, so they’re asking too high a price to finance or too many security provisions The Transnet partnership and contracts,” says will form a model for joint Ireland. “Or, on the other side, there’s ventures across Africa not a good enough power purchase or off-take agreement that’s strucGE established its first African tured appropriately and that prooffice in Johannesburg in 1898. tects you through administration “We’ve been here a long time,” says Ireland. Despite more than a changes where you need that concentury on the continent, Ireland’s sistency for long-term financing.” move to Nairobi in March 2011 was As a result, he says companthe first time GE had a member of ies like GE will have to become executive management based in more flexible. Already, GE is getAfrica.TheformerheadofGEAsset ting much more involved in the Management, Ireland moved to financing side of deals, bringing Nairobi soon after vice chairman in consortiums of investors to John Rice relocated to Hong Kong help to fund projects. In 2010, it as part of a company strategy to helped to secure the finance for

Nandu Buty

Baker Magunda

Ousmane Kane

Marketing and communications company Ogilvy & Mather named Buty as new chief executive officer of Ogilvy Africa in June. Buty, who has 20 years of advertising experience, comes into the new position having been executive director of Ogilvy Africa since 2010.

The former head of Kenya Breweries became the managing director of Guinness Cameroon on 21 June. Magunda’s appointment comes at a tense time following the Cameroonian government’s angry response to the price increase of some Guinness products.

In late June, Kane was announced as a non-executive director of Torontolisted miner Afferro, which has iron ore projects in Cameroon. A former minister of finance and governor of the central bank of Mauritania, Kane is also deputy chairman of the African Iron Ore Group.

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APPOINTMENTS

BUSINESS | FINANCE

FOREX

A tale of two forex controls: Kampala and Lusaka defend their own Government officials in Zambia and Uganda are using different tools to strengthen the use and value of their local currencies

AKINTUNDE AKINLEYE/REUTERS

oves by Zambia and Uganda to shore up their currencies against the US dollar have drawn anger from bankers and businesses. In May, Zambiaprohibitedthequotingand pricing of goods and services in a foreign currency, to promote the use of the kwacha. Penalties includeupto10yearsimprisonment. Since coming to power last September, President Michael Sata’s Patriotic Front government

has grappled with a weakening kwacha, which analysts blame on a lack of investor interest and sluggish mining output. Strikes by workers demanding higher wages drove Zambia’s trade surplus to its lowest level for years in February. The quoting ban boosted the fortunes of the kwacha, which touched K4,700 against the dollar in the first week of July, a 13-month high. Tour operators fear the move would hurt Zambia’s fragile tour-

Quoting prices in dollars could incur a prison sentence in Zambia, while Uganda has capped forex transactions

ism industry. “[Tourists] would rather go to Botswana or Kenya where they would not have to go through all that process [of changing their currency to kwacha],” says Rachel Ward, managing director of Zambezi Shuttles. The Law Association of Zambia has also called for the ban to be reversed. Meanwhile, eight months after Uganda’s central bank instituted a USh10 ($0.04) cap on the spread between bid and offer prices quoted by commercial banks dealing in foreign currency, Uganda is experiencing less currency volatility. Regulators implemented the policy after Uganda’s forex market became a soft target for speculators, with shilling-to-dollar transactions undergoing swings as high as USh50 in the space of a few hours. Sources say the central bank is now looking at how it could implement a similar ceiling for forex bureaus. “Foreign exchange transactions should be informed by the amount of liquidity in the market and not by the volatility,” said Denis Mashanyu, a trader with Standard Chartered Bank. The price ceiling could also hurt banks that depend on forex transactions as a vital revenue stream. The forex income as a percent of totalincomeatStandardChartered Bank shot up from 5.7% in 2010 to 14.1% in 2011, according to the bank’s 2011 financial statements.● Jeff Mbanga in Kampala and Chiwoyu Sinyangwe in Lusaka

MAURITIUS

A paradise of tax treaties attracts more visitors Regulators have announced more strenuous regulations, while the country’s diplomats sign more tax and investment treaties with their African counterparts

frica is the world’s new investment and growth frontier, and Mauritius is stepping up its efforts to be a base camp, much as Singapore and Hong Kong were for Asia. Charles Gaëtan Xavier-Luc Duval, Mauritius’s deputy prime minister and finance minister, was in London

in mid-June at a conference to promote the island as a stable and secure centre for business. Companies registered there are treated as Mauritian and benefit from a network of double taxation avoidance agreements (DTAAs), including 13 with African countriessuchasKenya.Nigeria’sDTAA is due to be signed in early August and agreements with Egypt, Malawi and Ghana are in the pipeline, according to the Board of Investment. There are also 11 investment promotion and pro-

tection agreements, also known as bilateral investment treaties, with African countries, which also applytoMauritius-registeredfirms or funds investing in Africa. Mauritian tax rates are low and offshore companies pay 3% or 0% tax. Mauritius is on a tax haven ‘white list’ operated by the OECD, although this list has been criticised by transparency campaigners, including the Tax Justice Network. Indian politicians claim that the country’s DTAA with Mauritius allows opaque financial ● ● ●

THE AFRICA REPORT

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East African Breweries First Bank of Nigeria Zenith Bank Safaricom Guaranty Trust Bank Nigerian Breweries Dangote Cement Nestlé Nigeria Sonatel Guinness Nigeria With markets generally on the up, subSaharan Africa’s most valuable stocks (outside of South Africa), have recorded good performances since the start of the year. The price of Nigerian banks has profited from a new hunger from investors satisfied by the clean-up of their accounts. Kenyan stocks have also advanced, in part but not totally on account of the country’s galloping

LAGOS NAIROBI LAGOS LAGOS LAGOS LAGOS ABIDJAN LAGOS

inflation. East African Breweries reached its highest price since May 1997 in late June on speculation of a profit boost from its sale of shares in Tanzania Breweries. On the other hand, the stock price of Senegal-based Société Nationale des Télécommunications (Sonatel) has continued to fall as the company struggles to find new avenues for growth in a competitive market. ●

Analyst’s view

Safaricom, winner of the price war • TURNOVER 2011-2012 $1.3bn (+13%) STOCK KSh3.6 ($0.04) on 12 July • TARGET KSh4.5 MARKET Kenya

“

SAFARICOM’S full-year results for the period ending March 2012 indicated a strong turnaround in performance during the second half of the financial year. We expected second-half results to be stronger than those of the first half, but the actual results were well above our own and the market’s expectations. The telecom operator benefited from higher than anticipated subscriber uptake, fantastic performance of the voice segment, an improvement in blended average revenue per user and strong growth of the non-voice segment. Safaricom emerged from Kenya’s recent price war as the only profitable telecom service provider. We believe the company is well positioned to take Binta Drave advantage of the growth potential in the non-voice Equity analyst with Exotix segment due to a strong product portfolio and wide distribution network. We believe further tariff reduction is unlikely at the moment, as telecom operators are looking to invest in new areas and to expand their networks. We reiterate our buy recommendation with a revised price target of KSh4.5. ● ALL RIGHTS RESERVED

● ● ● flows to enter the country, and the two sides are renegotiating the DTAA to make oversight more robust. The legal system combines French and British traditions, making lawyers able to work with most legal systems in Africa, and the London Court of Arbitration is establishing an international centre in Mauritius. At least half of the private equity funds investing in Africa are based there, including Aureos, Actis and Bob Geldof’s 8 Miles. The Stock Exchange of Mauritius has started to list offshore companies investing into worldwide projects, including in Africa, backed by a raft of new laws and regulations. “We are encouraging more substance and linkages to the local economy,” Ken Poonoosamy, the managing director of the Board of Investment, told The Africa Report.

INVESTMENT TENTACLES

Mauritian companies are already pioneering the way into the rest of Africa. After centuries of success, many find growth prospects limited at home – 4% economic growth is forecast in Mauritius this year, low by African standards but still out of reach for most developed countries. In Zimbabwe, Kenya, Namibia and South Africa, Mauritian firms invest in sugar, financial services, and information and communications technology. Newer projects include hotel development in Congo-Brazzaville. Jacques d’Unienville, chief executive of Omnicane, said the company is developing a $200m complex in Kenya to produce sugar, energy and alcohol. The group is planning a $15m hydropower project in Rwanda and looking for projectsinZimbabweandZambia, “the best countries in the world to grow sugar,” according to D’Unienville. Backed by Mauritius’s 250 years of sugar production and 50 years of producing power from bagasse, Omnicase wants to export its expertise. It is raising money for its expansion on the Mauritian stock market in a Rs3bn ($99m) bond programme, with the first Rs1bn due to be raised in July, subject to regulatory approval. ●

THE AFRICA REPORT

Tom Minney

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102

HAULAGE

Fixing the traffic

Regulations, cartels and crumbling infrastructure raise the cost and delivery times of imports and exports across the continent. New railway plans will help to bring more competition to the transport sector By Parselelo Kantai in Nairobi and Monica Mark

ity the East African truck driver, upon whose weary shoulders lies the burdenofEastAfrica’s exports. Setting forth from Mombasa to Kigali on a route known as the Northern Corridor, he will negotiate the arduous 1,700km

journey over five days. He will be on the road for 13 hours between 4.30am and 8pm each day, crawling at an average speed of 53km per hour over an uphill landscape set on some of the most tortuous roads on Earth. Aside from stopping for long hours at two border posts, he will encounter another

45 roadblocks where he will be forced to cough up an average of $158 per trip in bribes. There are also numerous detours caused by road repairs and construction, and even more delays to wait for accidents to be cleared. The East African Community found in 2008 that 95% of East Africa’s cargo is transported by road. In addition, more business is being done within the region, increasing traffic and creating new forms of delay. In Kenya alone, say transporters, there are more than 10,000 long-haul trucks plying the roads. Of the big Kenyan transporters, the likes of R.K. Sanghani, A.O. Bayusuf and Sons, and Multiple Hauliers boast

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jams

fleets of between 300 and 1,000 trucks. Even with improved fleets, regional regulations that limit axle-load weights mean more trucks, increased road maintenance costs and the slowing down of delivery times. Five years ago, the Rwandan government commissioned a study of the Northern Corridor. A Diagnostic Survey of the Kigali-Mombasa Transport Corridor found that 60% of the journey is spent on the side of the road and that bribes at roadblocks are small butnumerous.Thebiggestsources of delays were what happened before and after the journey due to Rwanda’s limited truck availability, slow import/export procedures THE AFRICA REPORT

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and cargo-handling problems. Despite this, World Bank studies praised Rwanda’s deregulation of the haulage industry in 1994, when the end of the monopoly of state-owned company haulier Société de Transport International au Rwanda led prices to drop by 75% in real terms. MIDDLEMEN AND MAFIA

In West Africa, delays and high costs are caused by the stranglehold of middlemen. In Côte d’Ivoire, a hub for transporting goods to landlocked Burkina Faso and Mali, a group of businessmen maintain a tight grip on the sector. They represent shadowy interests linked, some officials told The Africa Report, to Corsican families. Ivorian cashew farmer Moussa Traoré had a problem getting his produce to Burkina Faso twice a week. The 1,120km journey cost 1.2m CFA francs ($2,400) per trip. “That price is clearly not going to

AU G U S T- S E P T E M B E R 2 012

10% Projected annual growth of the freight business in East Africa for the next five years

be affordable for most small-time business owners. I tried asking different operators, but the cost was always the same. Eventually, I realised what it boiled down to was price fixing,” he said. “They know the trucks that are in a good state,” Traoré explained. “When I tried to get around the prices [they offered], I found the only trucks willing [to take my goods] were in a pitiful condition, had very few clients and unreliable drivers.” These trucks did not have Global Positioning System trackers, a major headache for any client, he added. Creaking roads and poor maintenance ruled them out of many rural areas during the rainy season. Traoré returned to “the very first middleman I visited – there are no real alternatives to road transport.” The soaring cost of transporting goods on West Africa’s roads remains among the highest in the world, curbing investment and

104 DOSSIER | LOGISTICS

preventing progress in a sector in which a plethora of small-time and inefficient owner-operators are the only alternative to expensive multinationals. NO NEGOTIATION

USAID West Africa Trade Hub, which works to improve conditions for the region’s exporters, estimates that in Ghana only four or five large companies, such as the Global Haulage Company, focus solely on trucking. Company owners say that many transporters operate informally, making it difficult to identify and fix problems that keep costs so high. A 2008 study by the Africa Infrastructure Country Diagnostic said the root of the problem was clear: ‘Deregulating the trucking industry in West and Central Africa is less a technical than a political and social issue.’ The report argued: ‘Whenever competition does exist, it is not based on price and quality of service, but on the capacity to circumvent

the rules and capture loads with little or no negotiation on prices or services quality.’ In Nigeria, for example, a lack of political connections means the risk of, as one company owner explained, “haggling for a week over a $10 bribe just to get your container on the road”. Poorly integrated markets and language barriers also contribute to the problem in West Africa. Much-touted plans to upgrade the Abidjan–Lagos corridor have also faltered amid wrangling on bilateral agreements. Infrastructure deficits also play a part. An official from Dangote Group, which runs a haulage business of more than 5,000 trucks under the brand DanTrans, estimated that upgrading roads in Nigeria could translate into a 5%-10% reduction in costs. In East Africa, a major factor associated with increased cargo costs is the region’s largely moribund railways. It is only now that landlocked Rwanda is plan-

10,000 trucks plying longhaul routes in Kenya alone

ning a national railway network. The Kenya-Uganda railway that opened up the region to the rest of the world 110 years ago has been in a critical condition for decades. “Even if you had the railway in working order, because it is a linear route rather than spread out across the region, you would still need trucks to move goods from the terminals to the final destination,” explains one Nairobi-based transporter. Last year, Egyptian private equity firm Citadel Capital sunk $300m into Rift Valley Railways, the operator of the Kenya-Uganda railway. The funds are to be devoted to upgrading the rolling stock and “getting the trains to run on time”, emphasised Citadel’s managing director Karim Sadek. Once fully implemented, Citadel’s plans could cut haulage costs by 40% and usher in the long-delayed migration from road haulage to rail, offering a long-term solution to East Africa’s perennial transport crisis. ●

SOUTH AFRICA SHINES BRIGHT BUT THE REST IS A LOGISTICAL MUDDLE SOUTH AFRICA CAME OUT as the top middle-income Tunisia performer in the World Bank’s 2012 Logistics Performance Index. It has moved up five places since 2010 to 23rd, Morocco putting it three places higher than China, and is the Algeria top performer in the group including Brazil, Russia, Egypt Libya India and China. The World Bank’s bi-annual survey asks 1,000 freight forwarders to rate countries on key indicators including quality Mauritania Mali of infrastructure, timeliness, customs effi- Cape Verde Eritrea Niger Sudan Chad Senegal ciency and the ability to track and trace Gambia Burkina Djibouti consignments. Guinea* Benin Nigeria Africa’s landlocked countries still form GuineaCote Ghana Ethiopia Somalia South Bissau Sierra d’Ivoire Togo Sudan C.A.R. much of the ballast at the base of the inLeone Cameroon dex. The average dwell time – the delays Liberia Uganda São Tomé Congo between unloading and exit from a port – is 14 e Príncipe Kenya Rwanda Gabon D.R.C. days in sub-Saharan Africa, compared to a couple of days Equatorial Seychelles Burundi* Guinea in other regions. ‘Much dwell time results from collusion Tanzania among control agencies, port authorities, private terminal Comoros Position in operators, logistics operators and large shippers,’ said the Logistics Malawi Angola World Bank report. It points to Douala in Cameroon, where Performance Zambia Index 2012 the cheapest storage option is to keep goods at the port. Mauritius 1-50 Morocco created an agency for logistics development in Zimbabwe Namibia 2011 and is trying to position itself as a trade hub through 51-100 Botswana Mozambique Madagascar Tanger-Med port. But the port has been beset by scandal 101-150 after Toufiq Ibrahimi, the former head of Tanger-Med and Swaziland 151-156 transport company Comarit-Comanav, was among those Lesotho South Africa no data arrested in June for mismanagement of the port, including sabotage of infrastructure and ships. ● Gemma Ware THE AFRICA REPORT

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REINHARDT HARTZENBERG/AMO/SIPA

Track upgrades include the replacement of all the main electricity supply struts

SOUTH AFRICA

Transnet’s $36.8bn spending spree to close infrastructure gaps The logistics parastatal is embarking on a record-setting capital expenditure programme to increase the country’s export capacity and triple the company’s revenue over the next seven years

ith an estimated 3.5m tn of coal lost through derailments en route to the Richards Bay Coal Terminal in 2011, Transnet Freight Rail’s (TFR) failures have cost South Africa dearly. Now the government and its parastatal logistics company Transnet have pledged to fight bottlenecks with the company’s biggest ever capital expenditure programme. In April, Transnet launched a R300.1bn ($36.8bn) investment drive it hopes will expand its infrastructure over the next seven years and create some 588,000 jobs. The new Market Demand Strategy is part of a move by the South African government to stimulate growth through investment in infrastructure and could boost the company’s revenue from R46bn to R128bn by 2019. The past five years have brought significant changes to South Africa’s state-owned freight and logistics company. In 2007, the group rebranded to unite its five divisions – freight rail, rail engin-

eering, national ports authority, port terminals and pipelines – under one banner. Last year, Transnet hired Brian Molefe as chief executive, a position that had not been permanently filled since 2009. Transnet’s bet is that new rolling stock and hundreds of kilometres of new track will accommodate the country’s rising mineral exports. Company executives say they will spend R201bn of the R300.1bn on the freight rail division. Plans to develop additional rail lines and increase capacity to transport coal, iron ore and manganese are already under-

way. The division is also working on a new 146km rail link from Lothair in Mpumalanga Province to Sidvokodvo in Swaziland. In mid-July, Transnet issued two tenders for the procurement of 1,064 locomotives and plans to increase the local content of its trains, following a partnership with General Electric (see page 93). TFR’s senior communications manager Mike Asefovitz says that the division hopes to spend R140bn on general freight to reduce traffic on the roads. Transnet has already committed to spend R32.1bn in the financial year ending March 2013. In June, Molefe told reporters the company would look to the debt markets to finance this and seeks to issue $500m-$1.5bn in foreign currency bonds this financial year. If successful, this would add to funds lent by the Agence Française de Développement in 2009 and the R11.1bn raised last year on the bond and money markets. Despite its rail woes, the group recorded an increase in revenue of 21% for the financial year ending March 2012. It rose from R38bn to R45.9bn as a result of volume growth. Demand from China and India pushed up coal and iron ore exports. With the higher turnover came a sharp rise in operating costs, driven by growing material costs, the hiring of new personnel and a spike in electricity and fuel prices. As about 80% of the freight network runs on electricity, Transnet has hedged itself against rising oil prices. ● Billie McTernan

Transnet’s future capacity (projected, m tn per year) 2012

2019

200

350

THE AFRICA REPORT

Rail volumes Coal export Iron ore export

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82.5

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South Africa’s ports are a key engine for growth and are central to the massive infrastructure development drive recently outlined by the South African government to enable economic growth and job creation. The Market Demand Strategy (MDS) formulated by state-owned freight transport and handling company Transnet SOC Limited is the centerpiece of this infrastructure programme. It entails an investment of R300 billion in capital projects over the next seven years. As port operator and one of five divisions of Transnet, Transnet Port Terminals (TPT) will invest R 33 billion (US $ 4.3 billion) of this amount to boost its cargo handling and logistics service at seven commercial ports along South Africa’s coastline. About 71% will be invested in capacity creation and expansion projects, while the remaining 29% will go towards capital sustaining projects aimed at achieving operating norms and upholding service delivery. Major projects include ramping up container capacity in the Port of Durban and at the Ngqura Container Terminal. In the bulk sector projects include increasing the capacity of the iron ore bulk facility in Saldanha to 82mtpa; creation of up to 12 million tons of manganese capacity by relocating the current export facility in Port Elizabeth to a newly created two berth manganese facility at the Port of Ngqura by 2015/16; and major equipment upgrades and storage expansion at the Richards Bay Terminal. As part of the MDS and in support of nine strategic transport sector objectives set out by the African Union and NEPAD (New Partnership for African Growth), TPT also intends forming partnerships with other African ports to promote South Africa as a regional hub for the rest of the continent. This will also help to position African ports as the growth engines of their respective economies. Key intra-continental initiatives being pursued by TPT include providing operational and technical advice to regional ports; pursuing regional port planning and port pairing initiatives, and exploring MOU’s with other African countries. TPT believes South Africa has an invaluable role to play, and with its economies of scale, the company is striving to position itself as the leading port operator in the Southern Hemisphere.

110 DOSSIER | LOGISTICS

MARITIME

the Royal Ruby from Brazil. Jetty One, with its four docking posts, is 336.5m long and 72m wide. It is built on two concrete piles. Jetty Two is 250m long and 140m wide. It hosts the container terminal that can accommodate two container ships at one time. The ship Nova Bretagne, which had arrived at post four, was carrying 2,157tn of frozen fish. Large lorries lined up to receive the cartons of fish for delivery to clients. These vehicles are subject to strict security procedures at the exit gate of the port. Security agents also keep an eye on the port’s operations day and night.

A day in the life of Lomé Port

Togo’s Lomé Port is one of the main drivers of the country’s economy – it is used to export phosphates and to feed markets in Burkina Faso and Niger

FRÉDÉRIQUE JOUVAL FOR JA

PAL’S EXPANSION

ntil the construction of a third quay, to be finished in late 2013, the life of the Port Autonome de Lomé (PAL) is based on the rhythms of its two main quays, which are already operatingatnear-maximumcapacity. The port is abuzz with activity day and night. The two jetties host six docking posts, and the two on the second jetty can accommodate larger ships. There, the water ranges from a depth of 11m to 14m. Jetty Number One is dedicated to conventional activities, while Jetty Number Two is for the handling of containers. Maersk Line’s Isodora arrived at PortLoméat8:00universaltimeon 4 July, after 24 hours’ travel from the Spanish port of Algeciras. She moored at the second post of Jetty Two, located on the eastern side of the harbour master’s office. The port workers needed to offload 463 containers from the Isodora and load 925 containers, of which 150 were full of merchandise. Led by a supervisor, two stevedores and a timekeeper, the operations began at 8:45 universal time and would continue for 30 hours.

A first team of 24 dockers started offloading operations that used four cranes, two of which were located onboard. Bit by bit as the containers were placed on land, they were then loaded onto lorries and whisked away to the import yard some 700m away. The 24 workers took turns so as to allow each one to grab something to eat, as it is nearly impossible to have a moment of inactivity once the ship has arrived in port. The first group of dockers that began work in the morning handed over to another groupat19:00universaltime,while another team will replace them at 7:00 the next day. While the dockers were working on the Isodora, others were active at the fourth post on Jetty One. They were offloading some 5,500tn of baggedsugarthathadarrivedon

Built for 400,000tn of traffic a year, and now handling 8m tn, Lomé Port never sleeps. A new quay under construction will vastly enhance its capacity

450m 24m tn Length of the new quay being built by Groupe Bolloré

PAL’s annual capacity for merchandise traffic once the third quay is completed

A state-owned company that enjoys financial and management autonomy, the PAL is a centrepiece of the Togolese economy. More than 80% of the country’s trade passes through the port. The port’s modernisation began in the 1960s, with a deepwater harbour completed in 1968 and designed for 400,000tn of annual traffic. Today, under the management of Rear-Admiral Fogan Kodjo Adegnon, it handles 8m tn. 1,175 ships unloaded here in 2010 and 2.3m tn of merchandise was destined for neighbouring countries that year. The port authority has chosen Groupe Bolloré subsidiary SE2M Togo, one of the two companies that runs handling operations at the PAL, to build the third quay. At the launch of the construction work in March 2011, Dominique Lafont, Groupe Bolloré’s director for Africa, said the project would enable the port to triple its current volumes within 10 years. SE2M awarded the construction contract to France’s Vinci with an expected delivery in 18 months. The project, costing 300bn CFA francs ($600m), centres on a quay 450m long and 15m deep. This will make the PAL West Africa’s first port that can receive large container ships with a capacity of up to 7,000 containers. Among the port’s other improvement projects, the port’s directors also aim to lengthen the mineral quay. ●

THE AFRICA REPORT

Nicolas Agbossou in Lomé

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122 A Groupe Jeune Afrique publication

BY MAHMOUD SALEM

Of apples and oranges

ne surreal aspect of living under a dictatorship is the parallel universe it creates. Dictatorial regimes create an environment that impedes the healthy evolution of their society. Yet these regimes are often obsessed with appearing as normal states, and thus create an imitation of a modern society. In the Mubarak days, Egypt’s ruling National Democratic Party heard talk among activists and the intelligentsia about the need for democratic elections, the transfer of power and constitutional reform. Never intending for those things to materialise, they created an imitation. They’d assure us it was the real thing by describing the new laws as “a step towards a more democratic Egypt” or “part of the initiative to curb the corruption that plagues us all”. This charade went on for 30 years, with oppressive tactics to support it – and with many people believing that stating an orange is an apple is a step in the right direction of eventually getting an apple. Like every Orwellian regime, this one was doomed to fall, and it did. The people removed the regime that had tricked them for years. After the revolution, the Muslim Brotherhood, the self-proclaimed party of the revolution, realised it needed to package itself to fit with the times but knew that the democratic nature of real parties could jeopardise its hold on power. It created an imitation political party, the Freedom and Justice Party. The moment it won the parliamentary elections it set about trying to curb the population’s freedom and sense of justice. It tried to pass laws that would criminalise protesting, eliminate union power and remove the rights that

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Egyptian women had acquired. At the same time, the party stated that it supported those same rights and that anyone who disagreed was an old-regime sympathiser and possibly an Islamophobe. When it came to a run-off between the Muslim Brotherhood candidate, Mohamed Morsi, and Ahmed Shafiq, a symbol of the old Mubarak regime, in the second round of presidential elections in June, The new many revolutionarpresident ies were terrified at the prospect of the seems old regime’s candidintent on ate winning. They recreating convinced themselves and others that Morsi the regime was the revolutionary that existed candidate. That this orange was actually under an apple. And 51% of Mubarak. those who voted ate It won’t it and voted for him. Our revolution work, for the began in order to same reason ensure that the president wouldn’t have it didn’t absolute powers, that work before the state would be governed by checks and balances and the rule of law. This is not happening. If anything, the new president seems intent on recreating the regime that existed under Mubarak, but with his own people. It won’t work, for the same reason it didn’t work before: the people might never have tasted an apple, but they damn sure recognise the taste of oranges and have had enough. But the revolution is gearing up again and will not stop until the people get the apples they deserve. ●

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Mahmoud Salem is an Egyptian blogger, writer and activist who can be found on sandmonkey.org and @sandmonkey via Twitter THE AFRICA REPORT

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N° 43

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AU G U S T- S E P T E M B E R 2 012

PRINTER: SIEP 77 - FRANCE N° DE COMMISSION PARITAIRE : 0715 I 86885 Dépôt légal à parution ISSN 1950-4810 THE AFRICA REPORT is published by GROUPE JEUNE AFRIQUE

TOP 25% QUARTILE

LIBERIA LB-09

PERFORMANCE

Apalis-1 & Narina-1 2011-2012

Of all wells drilled along the West African Transform Margin

OPERATOR OF

Mauritania Mauritania

31,387 Net Sq.Km Senegal Senegal

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2012-2013

A1 A4

Drilling Campaign

A1 A4

Mali Mali Gambia Gambia

Offshore Sud Offshore ProfondSud Profond

Guinea Guinea Bissau Bissau

BurkinaBurkina Faso Faso Guinea Guinea

Sierra Leone Sierra Leone

Ghana

Liberia Liberia

SL -04 A

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SL -03

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Cote d’Ivoire Cote d’Ivoire -0

SL -0 7A

-0

CI 513

CI-

LB-0

509

LB-0

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-0 8

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509

CI 513

CI-

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