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GHANA Akufo-Addo’s difficult second act

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CAN MACRON WOO NIGERIA? Trapped in the Sahel, France is trying to reinvent itself in anglophone Africa

EDITORIAL

WHEN THE LEVERS STOP WORKING

Ignore that man behind the curtain! So went the Wizard of Oz’s desperate command when his pretence had finally been exposed. It’s come to be a metaphor for the inflated self-regard of politicians around the world. Like the Wizard, there comes a time when they pull levers and nothing happens. For many governments, that time is now.

The levers no longer work and the centre isn’t holding. It has taken the twin threats of a public health emergency and devastating economic inequities to make this picture plain to all. Some have retreated into nationalism; others into epochal pessimism. The latest report from the US National Intelligence Council, ‘Global Trends 2040’, describes the pandemic as ‘the most significant, singular global disruption since World War II’ in terms of its medical, political and security implications.

As people sense that governments are losing their grip, they are mobilising in new ways. That portends, according to the US report, ‘more political volatility, erosion of democracy and expanding roles for alternative providers of governance’. It all adds up to an era of heightened competition between systems of governance and a ‘growing mismatch between what publics need and expect

and what governments can and will deliver’.

Although these warnings are in the public domain, national leaders and international bureaucrats haven’t got the message.

Public health is an area where starting with the grassroots works so much better than top-down policies. Africa’s experience in dealing with epidemics, especially Ebola, river blindness and Guinea worm, shows the key importance of local initiative.

That works for prevention and sounding alarms, as well as organising treatment. Vital intelligence about health crises often comes from farmers in remote areas. It depends on trust. National and international resources are needed to manufacture vaccines and protective equipment, but they require well-informed and credible local groups to distribute them.

Such life lessons from the pandemic offer a counter to forecasts of ineluctable descent into authoritarianism or government breakdown.

Parallels for education, economic and development policy are obvious. Our new digital networks are joining up grassroots organisations across the globe, sharing expertise and building solidarity. Sending resources to local initiatives, especially those run by women, creates more wealth, more jobs and spreads knowledge. Widely shared warnings of global food shortages should concentrate thinking and funds on the local.

None of this is to diminish the importance of getting international accords on corporate taxation, the global distribution of vaccines, or the transfer of allocations of the IMF’s reserve currency to developing economies. Those are necessary conditions for progress, but they are far from sufficient.

National governments have to ratchet down the hubris. Admitting the levers don’t work is a good first step. Devolving far more resources and power to the regions and the grassroots is the next stage.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER R 2021

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#116 / July, August, September 2021 THE AFRICA REPORT 57-BIS, RUE D’AUTEUIL 75016 PARIS – FRANCE TEL: (33) 1 44 30 19 60 FAX: (33) 1 44 30 19 30 www.theafricareport.com

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03 EDITORIAL 06 MAILBAG 08 OBITUARY / Béchir Ben Yahmed 10 COFFEE WITH THE AFRICA REPORT / Salim Saleh 12 OPINION 15 Q3 / July, August, September

48 DRC FOCUS President Tshisekedi has finally taken charge by sidelining former president Kabila. A look at his allies and his chances of succeeding with some of his key policies.

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28 INTERVIEW / Rwanda’s President Paul Kagame He talks about the country’s complicated relationship with France and neighbours in East and Central Africa. And he answers questions about freedom and the role of his family.

34 WIDE ANGLE / Sudan’s New Dawn Diplomatic and debt-relief deals are creating new opportunities for the transitional government, which has tough challenges on the security and economic fronts.

40 WIDE ANGLE / Akufo-Addo’s second-term test Political and economic obstacles stand in the way of the flagship policies of Ghana’s President, who was re-elected in December 2020.

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128 ENERGY DOSSIER The oil majors grapple with the energy transition on the continent.

136 AGRICULTURE DOSSIER Tea, climate change, citrus and more.

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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FRANCE IS A SPONSORING LOOTING AND TERRORISM

The French are always found in any African country suffering from criminal ruling cliques, terrorism, theft of natural resources and misery.

This is not a coincidence. African states and world powers must kick France out of Africa totally. French support for regimes in West and Central Africa is devastating for security, peace and development in many countries.

Tarig Anter

COPY AND PASTE

Alas, in many cases entrepreneurship teaching in developing countries merely copies the entrepreneurship teaching from the West.

It doesn’t take into account the cultural and institutional differences between Africa and the West. In 2020 I published a book, Cross-cultural entrepreneurship and social transformation: innovative capacity in the Global South. Some

TANZANIA TURNS A PAGE

Tanzania’s late president John Magufuli laid a new foundation: one can clearly see the change in most public sectors, eg. health and government institutions. It will be much easier for President Samia Suluhu Hassan to take over as this foundation was laid. Suluhu, being a woman, may bring compassion and circumspection, which will spear the nation to a new direction. As a nation, we expect to keep the momentum going and support the new regime from Zanzibar to the mainland since our new leaders could bring a totally different Tanzania.

Queen Uroki, Banker

important points: on the level of business culture/ management style there are many problems with entrepreneurial capacity: lack of customer orientation, lack of planning, overly hierarchical management. At the level of cooperation/competition between businesses there is lack of trust and a high dependency on vertical networks: important people at the top that may obstruct the business and/or grant privileges in return for favours. At the government bureaucracy level these vertical

networks cause institutional voids, lack of regulation and lack of policies that are conducive to entrepreneurship.

Otto Kroesen

AFRICA’S BANKS AND ENTREPRENEURS African banks are more focused on collecting saving monies to invest and get profit from mutual insurance funds than on assisting entrepreneurs. You do all the work and when your turnover is huge, you see them coming to you. They have never

anticipated the growth of SMEs. In fact they don’t want Africa to build a strong industrial sector.

That’s why you see microfinance banks holding billions dollars and reinvesting them in Europe or North America. As an entrepreneur myself and managing my own company since 2007, I don’t rely on them for the growth of my company.

Our assistance and networks always come from outside the African continent.

Martial Harryson Ohomon Managing director, OTC

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

HOMAGE OBITUARY

From the Jeune Afrique offices in Paris, BBY had a hotline to African leaders of all stripes

STUDIO KAHIA

VINCENT FOURNIER/JA

BBY (centre) as a young minister in 1957, with Habib Bourguiba (left) and Ahmed Mestiri (right)

BÉCHIR BEN YAHMED

1928-2021

The founder of Jeune Afrique and La Revue and publisher of The Africa Report, Béchir Ben Yahmed was a sharp observer and committed editorialist who provided deep insight into the continent’s major upheavals of the 20th century. He passed away on 3 May 2021 in Paris Perfectionist and self-critic that he was, Béchir Ben Yahmed (BBY) admitted that he had to give something of himself away in his memoirs, which he worked on for more than a decade. But committing his own view of himself to paper was a rare and undoubtedly difficult exercise for him.

He described himself as a journalist, a businessman, a man of the left. Some said he was stubborn; “persevering”, he corrected them. Authoritarian? “It’s a

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myth,” he said, explaining that in his youth he had been “sickly shy” and that this character trait perhaps explained his sometimes abrupt approach.

From a generation of young proindependence activists, he followed a different path from most of his comrades, which he said left him with no regrets. Many who knew him as a promising young minister in Tunisia’s first government asked what had happened to turn him away from politics.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

BBY replied without hesitation: “I did not want it. There is a price to pay. I don’t want to do what politicians do to get votes: beg, make sacrifices, compromise. I don’t have it in me.”

Jeune Afrique, he said, was his life’s work. Béchir Ben Yahmed dedicated more than six decades to journalism, first as a reporter and then as the director of a media company. The French president, Emmanuel Macron, described to him as “a man of the press and of conviction, who both contributed to and shed light on the African independence movements”.

For Hervé Bourges, the former head of French broadcasting, BBY was “a confidante, a daily interlocutor, a

JEAN-MICHEL TURPIN FOR JA

Béchir and Danielle Ben Yahmed with Senegalese president Léopold Sédar Senghor

partner [to the leaders of the continent] in building a new African narrative.

They sometimes banned his magazine; then they allowed it again, they fell out with him, they loved him or hated him. They have always valued him.”

According to Bourges, “JeuneAfrique came to represent a form of collective consciousness for an entire continent, which the international press had difficulty understanding. It was a demanding and impossible role. And yet, he didn’t just meet the challenge – he nailed it.”

On 7 October 1961, Ben Yahmed wrote an editorial in the magazine he had founded in Tunis, Afrique Action, on ‘personal power’. It provoked the ire of his former boss, President Habib Bourguiba. The magazine was not banned, but the ‘supreme combatant’ made it known that he considered himself the owner of Afrique Action.

Forced to change its title, BBY opted – without much conviction, he later confessed – for Jeune Afrique. A name that would become synonymous with that of Béchir Ben Yahmed.

From 1976 to 1994, Jeune Afrique enjoyed its most prosperous period, with a staff of nearly 150 people. BBY added new titles: Afrique Magazine, Jeune Afrique Économie, Telex Confidentiel (a daily insider newsletter), and Les Éditions du Jaguar (travel guides). The

‘[African leaders] loved him or hated him. They have always valued him’

period was not without its problems.

In 1990, Ben Yahmed faced a long legal battle after he sold Jeune Afrique Économie to Blaise Pascal Talla, a sales agent for Jeune Afrique, without demanding a change of title.

Another misstep was to purchase a travel agency, TMV, which turned out to be loss-making. Jeune Afrique was already in financial trouble following the devaluation of the CFA franc in 1994. Overnight, the magazine lost half its revenue.

“I had foreseen that the CFA franc would be devalued, but I didn’t take enough precautions,” admitted Ben Yahmed. “I racked up debts. I sold everything. We couldn’t even pay the rent and salaries anymore.”

The commercial court sent several warnings, designed to encourage BBY to accept a receivership or even a sale.

There was no shortage of offers: Elf,

Havas, Vincent Bolloré... BBY refused to look at them.

He didn’t hide the assistance he received, in various forms, from heads of state such as Senegal’s Abdou Diouf, Tunisia’s Zine al-Abidine Ben Ali, Gabon’s Omar Bongo Ondimba and Mauritania’s Maaouya Ould Taya, not to mention France’s President François Mitterrand. Not all were friends - not by a long shot. After a seven-year struggle, Jeune Afrique finally regained its footing, having laid off three quarters of its staff.

At the age of 80, as Jeune Afrique reached its half-century mark, BBY handed the reins to his sons, Amir and Marwane, and editorial director François Soudan. Continuing to deliver his weekly editorials, ‘Ce Que Je Crois’ (‘What I believe’), he launched his final project: the monthly French-language generalist magazine La Revue.

“My sons Amir and Marwane now have all the power,” he said. “Another Jeune Afrique will be born.” He did offer them a final piece of advice, adapted from the Serenity Prayer of US theologian Reinhold Neibuhr: ‘Have the will to change all that you can change, the wisdom to accept what you cannot change, the intelligence to distinguish between what you can change and what you must accept.’

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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COFFEE WITH THE AFRICA REPORT

SALIM SALEH BROTHER IN ARMS

Uganda’s veteran military commander [and presidential sibling] holds forth on the youth challenge to the Museveni regime, growing coffee and regional diplomacy

By PATRICK SMITH A phone alarm sounds and, with military precision, Lieutenant General Salim Saleh logs onto the video conference call at the top of the hour.

Sporting an open-necked shirt and cradling a large mug of coffee, Saleh is ready for combat – of the verbal kind, he assures me. More gentleman farmer than security hegemon today, Saleh is speaking from his house in Gulu, the city in northern Uganda that became the epicentre of the Lord’s Resistance Army insurgency three decades ago.

Now he is leading a national project there to boost coffee production.

East African coffees are thriving. To mark the occasion, I brewed a pot with beans from the grassy slopes of the Rwenzori mountains, which straddle Uganda and the DRC. In demand in Europe and the US, these light, fragrant beans are shipped from both countries. Another reason to find a way to cooperate in the regional economy.

Two points dominate Saleh’s biography. His older brother is Uganda’s President Yoweri Museveni, to whom he has been a long-time adviser on all

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matters military. The second is more contentious. Saleh is widely said to be one of Uganda’s richest businessmen, with interests in gold and private security companies, as well as extensive land holdings.

Cue for the first rebuttal. All that, insists Saleh, is a gross exaggeration.

“For starters, I’m not a greedy person.

I don’t have money like all those other leaders who keep money abroad.

I don’t have a foreign account. My account in Uganda is overdrawn.” A polite chuckle hangs in the air for a few moments, on both ends of the line.

Saleh is not your regular businessman. Born Caleb Akandwanaho, he left school at 16 to join a Tanzania-based

‘I’m not a greedy person. [I’m not] like all those leaders who keep money abroad’

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

rebel group fighting Idi Amin’s regime, led by his brother, Museveni. When the rebels sent him to Mozambique for military training, he adopted the nom de guerre Salim Saleh. When, in 1986, the National Resistance Movement (NRM) launched their final assault on Kampala, bringing Museveni to power, it was Saleh who commanded the operation.

As commander of the National Resistance Army, Saleh led the fight against sundry insurgents in the north, some backed by Amin’s erstwhile allies, some by Sudan’s Omar al-Bashir.

He again emerged as a key player in Uganda’s bid, with regional allies, to oust Mobutu Sese Seko in Congo – this time in a less flattering light. He was named in a UN experts’ report as one of an ‘elite network’ of military officers and businessmen involved in the gold trade in the DRC. Not so, says Saleh. “It looks as if I own companies there […] when I don’t have a single company there.”

He adds that he has barely set foot in the country, despite his role as a point man for all matters Congo.

In April, Kinshasa told the Inter­ national Court of Justice it was seeking $4.3bn in reparations against Uganda for illicit gold exports. A judgement on the long-running dispute is due in November. What are the chances that Kinshasa will win its claim? “Zero, in my opinion,” says Saleh.

Also in April, Uganda offered to send its soldiers to help the DRC government with security on its eastern flank. Military cooperation might encourage a legal settlement or trigger new ructions.

The rift between Rwanda and Uganda is yet to heal fully after their two armies clashed in Kisangani two decades ago.

Rwanda followed the

‘The generational divide has been hyped up. […] My generation is almost out’

the leaders in South Sudan but powerless to prevent the recurring clashes between the two main factions there.

On retiring as Lieutenant General in 2005, Saleh stayed on as security adviser to Museveni and as a peripatetic businessman. Now his focus is the political economy. “Between 2003 and 2005 we carried out a defence review and we determined that [in 15 years’ time], of the 134 threats facing the country, only four will be of a military nature. The threats we are facing are mainly to do with unemployment, poverty, climate change […] the security around us, not within us.”

For the NRM, it seems the political expression of these threats is the presidential challenger in the disputed January elections, Bobi Wine, who won 37% of votes. Saleh says: “The young people in Uganda have spoken. They have not been in politics a long time but the success they have achieved is phenomenal.” After the security crackdown for Museveni’s inauguration, when Wine was confined to his house, Saleh offered a minimalist olive branch to

JEAN-MARC PAU FOR TAR

Museveni-Saleh regional security playbook and then challenged it, which led to the flare-ups. “Our disagreements with Rwanda will not lead to war,” asserts Saleh, who was close to the Rwandan Patriotic Front’s charismatic founder, Fred Rwigyema.

Saleh’s private security company, Saracen, sends security guards to Somalia as well as to some Gulf States.

He and his brother have been close to

the National Unity Platform. “All we are asking them is to institutionalise their capacity, go into parliament where they have got a huge representation. […] Let them exercise that mandate that they have been given by their fellow youth to bring up issues for discussion and execution.”

How could that work after months of violence before the elections, and reports of abduction and torture by security agents? Saleh says: “Violence is a two-way traffic. If they are violent, the state will be violent. If they are non-violent, the state will not be violent.” It is a line that has failed to convince. The US and the EU have imposed visa restrictions on senior officials in Kampala.

Some see Saleh’s calls for a closer working relationship with the opposition youth groups as a blatant bid to co-opt, or divide, the growing ranks of youthful dissidents. “The generational divide has been hyped up,” he argues. “If you look at all the managers in charge of corporations and organisations, they’re aged between 35 and 45.” Saleh detected my scepticism. “No, we’re almost out. My generation is almost out.”

On his way to the metaphorical exit, Saleh offered another message to Bobi Wine, whom he used to meet informally. “He should discipline himself […]. There’s a budget for the leader of the opposition. If he manages that, he can project the youth agenda.” Then, in case that seemed too indulgent: “Although we, the NRM, are already handling the youth agenda.”

JULY-AUGUST-SEPTEMBER 2021

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OPINION

THE TIME OF MONSTERS

Crystal Orderson is deputy editor at South African media outlet eNCA; Patrick Smith is editor-in-chief of The Africa Report

Supporters of President Cyril Ramaphosa are lauding the vanquishing of his main opponent within the governing African National Congress (ANC) – former secretary general Ace Magashule. No doubt Ramaphosa has scored a political victory in the councils of the ANC by squeezing out Magashule on corruption charges.

It seems the legal battles – which pit Magashule (with the help of an expensive, opposition-aligned lawyer) against his own party – are set to stretch out much longer. This will wash the ANC’s dirty linen in public.

It will be up to the courts to decide on what should be an internal party matter. Ramaphosa may have allowed himself a celebratory drink and an extra-long bike ride. But the strategic side of his character will be telling him that it’s way too soon to declare

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‘mission accomplished’. It may just be the end of the beginning.

Ace Magashule reminded his supporters at a rally for his patron, ex-president Jacob Zuma, in Pietermaritzburg: “I will never leave the ANC comrades, I will die in the ANC.” If you’re looking for points of light, there are plenty. South Africa is still the beloved country its people liberated in 1994 after hundreds of years of struggle. It has the same incredible array of people and talent; the same abundance of natural resources. But, in what many South Africans call the wasted years, its institutions have taken a hammering, with widespread looting of the resources meant to uplift the very people who put the ANC in power.

We have reversed the progress we were making in overturning structural inequalities and racism.

We all know it needs radical change, but those within the party can’t agree how. Some of us have just given up, voting to the left or the right of the ANC, or, worst of all, not voting at all. That is a scary thought because so many people have died for this right.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

ALL RIGHTS RESERVED

CRYSTAL ORDERSON and PATRICK SMITH

Now we have another impossibility on our hands. Can the ANC rebuild itself while it holds power at the centre and in the provinces? Political scientists say: ‘No chance’. It is doomed to get more and more dysfunctional until it implodes and loses power.

Before the pandemic, that analysis looked spot-on. Now President Ramaphosa’s gradualism is bearing fruit. His strategy is to change the ANC from the top down and also transform the state machine by appointing honest and capable officials to key agencies such as the National Prosecuting Authority. Progress is much slower in other institutions such as the security agencies and the police.

Some of it is working. Look at the Zondo Commission, set up in 2018 to investigate the beneficiaries of state capture. Slowly but surely, some of those local and international companies such as the US’s McKinsey have admitted to wrongdoing and are returning their ill-gotten gains. An Interpol Red Notice has been issued for the Gupta family. Assets worth millions have been seized.

There is a long list of state officials and ANC party hacks facing criminal charges. More complicated is the other side of the ANC’s reform coin: trying to rebuild the party from the grassroots up. This will be tested at the next round of local elections due this year.

The ANC may prove more resilient than many predict. Its main rivals, the Democratic Alliance and the Economic Freedom Fighters, are haemorrhaging support at the ballot box. At byelections in May, the ANC trounced its rivals, despite the economic and public health problems.

In an electoral system based on proportional representation, the vetting of candidates is often done at the party headquarters, where officials decide who makes it on to the party’s list of candidates. In some areas, the local ANC branch is so unpopular that the party-approved candidate would stand

ADRIÀ FRUITÓS

The social costs – in terms of lost educational opportunities and the running down of public healthcare – are incalculable. As is the damage that the high point of grand corruption and patronage has wreaked on South Africa’s political system. no chance. So, now, party officials say they want to try something quite revolutionary: to give power back to the people.

Ramaphosa has appointed one of the ANC’s most respected elders, Kgalema Motlanthe, to lead the candidate selection process. And they say they will ensure that the best and brightest represent communities. It will no longer just be professed loyalty to the ANC that gets you in.

The idea is that local communities choose their candidates, who will then be offered ANC membership with all the benefits that would imply for their candidacy. It’s a bold move, adding more complexity to party nominations.

It could be risky, too. ANC branches don’t take kindly to outsiders and local councillors have been assasinated because of political vendettas.

What happens, as one commentator asked, if the local community chooses a sexist xenophobe and homophobe populist? Will the local ANC branch have to respect that decision? Not likely. The chances are that the local ANC branch will prevail. But the attempt to be responsive towards

Damage to South Africa’s liberation project cannot be laid at the door of Zuma and his allies alone

community sentiment could boost the ANC’s reform project.

When Ramaphosa took over the reins of state in February 2018 there was an efflorescence of optimism known as ‘Ramaphoria’. Ramaphosa, the lawyer turned political strategist, was going to restore the proud and liberated Rainbow Nation that Madiba had founded in 1994.

That is another country. The financial cost of Jacob Zuma’s presidency and patronage system is reckoned by credible witnesses to the Zondo Commission of Enquiry to have cost the country in excess of US$80 billion.

Yet, that system has not been able to produce a viable opposition party.

The most obvious signs of this are the incessant load-shedding by the state power utility Eskom and the appalling conditions in the public hospitals and clinics, made worse by the Covid-19 pandemic. Communities and even hospitals have suffered water shortages. Then there is the dangerously slow distribution of vaccines, and the legions of civil servants planning strikes to shut down government.

Of course, the damage done to South Africa’s liberation project cannot be laid at the door of Zuma and his allies alone. It was very much a joint venture over several years, when the hopes of the new order collided with the harsh realities of the old.

A friend lamented that South African voters have been locked into an abusive relationship with the ANC. As the Italian philosopher Antonio Gramsci said: “The old order is dying and the new one struggles to be born: now is the time for monsters.”

Patrick Smith was in conversation with Crystal Orderson.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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D I G I TA L E D I T I O N

SAVE THE DATE 28 - 30 September 2021 A New World coming: how can Africa and its private sector navigate the change?

TO REGISTER www.theafricaceoforum.com CO-HOST

ORGANIZER

MAURO VOMBE, UNTITLED, FROM ‘FACES’ - AFRICAN PHOTOGRAPHY; CAP PRIZE 2021

Quarter

The Africa Report’s exclusive guide to the quarter ahead features key events from the worlds of politics, business and culture. Find out more about how to plan your July, August & September.

Election-watching party with your Lungu- and Hichilemasupporting friends? Looking for a beach read? A spot of art in Cape Town? Or to indulge your interest in building hotels on the continent? No matter your tastes and hobbies, there is plenty on.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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Q3

/ JULY POSTPONED POLLS

Somalia’s President Farmaajo has been on the campaign and deal-making trail since late 2020

ABDIRAHMAN YUSUF / AFP

Somalia elections

15.06% South Africans must prepare for a large hike in their electricity bills from 1 July.

On 1 April, the National Energy Regulator of South Africa approved the national electricity company Eskom’s request to raise electricity prices for direct customers by 15.06%. Municipalities will announce their own increases, based on their approved budgets, which are likely to be 13.5% for Cape Town and 14.5% for Johannesburg.

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Somalia’s political stalemate is set to end by July, but those plans – like others before them – could be thrown off course by insecurity and political wrangling. At the end of May, prime minister Hussein Roble and the leaders of five regional states agreed to aim for parliamentary elections to be held within 60 days.

Opposition candidates including former presidents Sheikh Sharif and Sheikh Hassan and former prime minister Hassan Ali Khaire complained of attacks against them by government forces in the lead-up to the 2021 election campaign.

President Mohamed ‘Farmaajo’ Abdullahi Mohamed had promised to hold ‘one person, one vote’ elections at the end of his term in December 2020, but was unable to do so due to Islamist rebel group Al-Shabaab’s control of territory, and disagreements with the leaders of Somalia’s federal member states. In September, Somalia’s leaders agreed to a deal to hold indirect elections by the Federal Parliament.

Political tensions are high. Due to a perceived increase in misinformation shared on social media, the Federation of Somali Journalists has launched a campaign called the ‘Disinformation Lab’ against the spread of fake news, hate speech and propaganda.

BOOK Winner of the Prix Ahmadou-Kourouma, the Grand Prix du Roman Métis, and the French Voices Grand Priz in Alexia Trigo’s translation (Europa Editions), the Senegalese writer Mohamed Mbougar Sarr’s debut novel, Brotherhood, is set in an imaginary world of a fundamentalist Islamist government. Following the public execution of two lovers, the characters show heroism, cowardice, fear and love when faced with a brutal regime.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Q3

/ JULY ‘This training programme represents the strengthening relationship between the United States of America and the Republic of Mozambique’

MTN

APPOINTMENTS

DENNIS HEARNE The US Ambassador to Maputo prepares for a second joint training exercise against Islamic State terrorists in July, as Portugal sends in more troops.

PHUTHUMA NHLEKO The former MTN group executive chairman’s appointment as an independent non-executive director of the Johannesburg Stock Exchange (JSE) is effective from 1 July. He will also become the board chairman from May 2022.

ALL RIGHTS RESERVED

40%

Ethiopia is to sell up to 40% of the stateowned telecommunications company, Ethio Telecom, the main internet and telephone service provider in the country, by July. Many international bidders are interested.

EDNAH OTIENO

BOOK A collection of poetry by the Congolese award-winning writer of Tram 83, Fiston Mwanza Mujila, celebrates the Congo River – a metaphor for the post-colonial DRC. Previously the main route for exploitation of the country’s resources, it is now a symbol of life, but also of poverty and insecurity. Mixing history, religion and myths from Africa and Europe, the volume, originally published in French in 2013, is translated by J. Bret Maley for Deep Vellum.

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ETHIOPIA

Fill and be dammed Egypt’s President Abdel Fattah al-Sisi has described preventing the second filling of the Grand Ethiopian Renaissance Dam (GERD) as an “existential issue” for his country. The dam has a capacity of 74bn cubic metres, and the aim is to generate 6,000MW through 16 turbines, but countries downstream are worried about the long-term effects on their water supplies. The first filling of 4.9bn cubic metres took place in 2020, and Ethiopia has scheduled the second for July 2021. Sudan claimed at the end of May that the filling had already begun, heightening tensions between the two countries.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

MAXAR TECHNOLOGIES/AFP

East African Breweries Group human resources director Otieno, who has been in the profession for 18 years, has been appointed to the same role at Diageo Great Britain as of 1 July.

Q3

/ AUGUST

HAKA AINDE LEMA HICHIL

EDGAR LUN NGU Populist appealing to rural and Copperbelt voters, going ffor his second electeed term

SALIM DAWOOD

ROBERTO PAQUETE/AFP

mpt for Sixth attem to presidency; aims a restructurre debt

ZAMBIA

Will the debt crisis mean the end for Lungu?

On 12 August, Zambians will head to the polls to vote in general elections, which must be held every five years. Due to heavy borrowing and a combative relationship with mining firms, Zambia is struggling to pay its debts. Will President Edgar Lungu and his Patriotic Front (PF) party hold on to power?

Lungu’s backers want him to stay to spend more on infrastructure and talk tough to mining companies.

A populist, he has sought to get more support from women and young people with projects to boost agricultural production.

However, since the 2016 election that gave him the legitimacy of a popular vote – he originally stepped into the presidency when Michael

Sata died in office – Lungu has been accused of authoritarianism.

In 2017 the Conference of Catholic Bishops, who rarely speak out publicly, made a statement concluding that Zambia ‘is now all, except in designation, a dictatorship’.

One of their complaints was that opposition leader Hakainde Hichilema had been arrested on a trumped-up treason charge – a claim supported by Amnesty International. Hichelema was released, but the possibility of re-arrest hangs over him.

A businessman campaigning on a programme to fix the economy, who lost in the 2016 elections by about 10,000 votes, Hichilema and his United Party for National

23.6m

‘This is a new start, a new deal for Africa’ MACKY SALL

SOLAR

Senegal’s President Macky Sall backs a drive for rich countries to reallocate some $100bn of their special drawing rights at the IMF to provide more finance for African countries.

The government in South Africa is trying to approve 1GW of solar photovoltaic projects as part of its Renewable Energy IPP Procurement Programme.

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Development are unlikely to have an easy ride. His traditional support base is in the south and west, whereas Lungu polls well in the north and east (the Copperbelt).

Hichilema is trying to win over PF-leaning urban voters and says he wants to unify the country, restructure the debt and reduce government spending.

The Electoral Commission of Zambia has published a new voters’ register, which addresses many of the opposition and the bishops’ concerns, but Hichilema and his supporters say they still worry that not everyone who is eligible to vote will be able to do so. Lungu has also banned campaign rallies, citing anti-Covid-19 measures.

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NGOs are warning of an ‘unprecedented’ rise in the number of people facing acute food insecurity in the Sahel and West Africa in the upcoming lean season, which runs from June until August. The biggest contributor to the rise is the growing number of food-insecure in Nigeria.

Q3

/ AUGUST MUSIC

GALLO IMAGES

FLYING South African Airways, which suspended commercial flights in September 2020 due to Covid-19 and debts, aims to restart in July or August if the health situation permits.

Multi-award winning South African singer-songwriter and recording artist Amanda Black will release her latest album, Mnyama, this month. She first came into the spotlight as a contestant on the TV show Idols SA. Speaking about the new album, the singer said: “We want better days […]. We seek healing from the incredulous [sic] losses we have experienced during this time [the Covid-19 pandemic] and I hope people can find it through my story.”

ART

Waiting for Gebane For six years, South African artist Senzeni Marasela wore the same symbolic dress, through which she inhabited her alter ego, Theodorah Mthetyane. In this solo exhibition, she narrates Theodorah’s story – and a universal story of women waiting – using textiles, embroidery, photography and painting. When Theodorah’s husband, Gebane Hlongwane, leaves her in a rural town to look for work, he gives her an ishweshwe dress, signifiying marriage in Xhosa culture, which she wears in the hope he will return. The exhibition is at the Zeitz MOCAA – Museum of Contemporary Art Africa in Cape Town until 29 August.

BOOK Leïla Slimani’s third novel, released in French last year, is out in translation this month. In the Country of Others (Random House) is story about freedom and belonging in colonial Morocco, and set to be the first part of a trilogy.

ALL RIGHTS RESERVED

APPOINTMENT

ZEITZ MOCAA

C. SURENDRAN

Telling through textiles

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

C. Surendran takes over as CEO of Airtel Nigeria on 1 August 2021, when Olusegun Ogunsanya moves to Airtel Africa.

Surendran was CEO of Airtel’s largest Indian subsidiary in Karnataka.

Experience the Progress.

www.liebherr.com info.lex@liebherr.com www.facebook.com/LiebherrConstruction

Q3

/ SEPTEMBER

Kudita Tamary, ‘African Victoria’ from ‘African Victorian’

AFRICAN PHOTOGRAPHY; CAP PRIZE 2021

AFRICAN PHOTOGRAPHY; CAP PRIZE 2021

Kourkouni Adil, ‘Untitled’ from ‘Utopic Perception’

Mauro Vombe, Untitled, from ‘Faces’

PHOTOGRAPHY

Eyes on the African prize

‘Africa needs [Covid-19] vaccines now. Any pause in our vaccination campaigns will lead to lost lives and lost hope’ MATSHIDISO MOETI The WHO’s regional director for Africa says the continent will need 200m vaccine doses to hit the target of 10% of the population by September.

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AFRICAN PHOTOGRAPHY; CAP PRIZE 2021

The five winners of the Continental African Photography (CAP) Prize will be announced in September, from a shortlist of 25 projects. From fine art portraits to documentary and experimental photography by photographers from Nigeria, Morocco, Egypt and more, the shortlist is a showcase of continental talent. Previous winners of the CAP Prize have had their work shown in festivals worldwide.

KENYA The Kenyan government is getting serious about developing the country’s export potential. Parliamentarians are expecting to receive reports about the setting up of Kenya Export Promotion and Branding Agency by September and studies about export markets by December.

Q3

/ SEPTEMBER

HOTEL CHAIN DEVELOPMENT PIPELINES IN AFRICA 2021 Pipeline

30000

EVENTS

Existing

TOTAL NUMBER OF ROOMS

25000

Oil industry insiders will be in attendance at the Angola Oil & Gas Conference on 9-10 September to discuss the future of one of Africa’s top crude producers.

57,603

20000

79,287 SOURCE: W HOSPITALITY GROUP

15000 10000 5000 0 Accor

Marriott International

Hilton

Radisson Hotel Group

The next United Nations General Assembly meeting will kick off in New York on 14 September, with leaders from Africa and all over the world laying out their international priorities.

On 15 September, Invest Africa will host The Africa Debate on the theme of ‘The Great Reset’.

IHG

TOURISM

A day in the sun Covid-19 has dampened some optimism in the African tourism industry, but not all of it. The continent’s major international hotel chains are still committed to their long-term development plans. African tourism ministers and actors in the sector will be meeting to discuss developments at the Arabian and African Hospitality Investment Conference in Dubai on 20-22 September and the Africa Tourism Investment Summit in Cape Town on 1-3 September.

By far, Egypt is attracting the most activity, according to the 2021 Hotel Chain Development Pipelines in Africa report. It says: “Whilst the crisis had a profoundly negative impact on Africa’s travel and hotel operations, the impact on deal signing was, surprisingly, much less – there were 71 deals with 10,000 rooms signed since the last study, down ‘only’ 30% on 2020.” After Egypt, Nigeria and Morocco are attracting the most activity.

In terms of international competition, the top leadership spots are held by France’s Accor and the US-based Marriott group, which are far ahead of their multinational peers and local competitors (see graph). Marriott made its first move in the Nigerian market by opening the 206-room Lagos Marriott Hotel Ikeja in May in the country’s economic capital. Meanwhile, Accor opened the luxury floating hotel the Mantis Kivu Queen uBuranga to tour Lake Kivu in Rwanda this year.

BOOK A collection of essays from 24 acclaimed writers, Of This Our Country is a personal work, one in which Nigerians attempt to define their home country, whilst realising that this is not entirely possible. Contributing authors include Half of a Yellow Sun’s Chimamanda Ngozi Adichie and Everything Good Will Come’s Sefi Atta.

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

4.5m

Dangote Cement is aiming to increase total cement production capacity in Nigeria to 4.5m tonnes a year before September. The plan includes restarting production at the company’s plant in Gboko, Benue State. The government is worried about high cement prices, and so is opening up the market to more international competition.

BOOK Written by Max Lobe, A Long Way from Douala is a novel that follows the journey of two friends across Cameroon, while they deal with grief, sexuality, dreams bigger than reality, and more. Some of the many themes include violence, terrorism, homosexuality and migration.

FRANCIS KOKOROKO/REUTERS

Features

28 INTERVIEW Rwanda’s President Paul Kagame

34 WIDE ANGLE Sudan’s new dawn

40 PROFILE Akufo-Addos’s second-term test

He talks about the country’s complicated relationship with France and neighbours in East and Central Africa; he answers questions about freedom and the role of his family.

Diplomatic and debt-relief deals are creating new opportunities for the transitional government, which has tough challenges on the security and economic fronts.

Political and economic obstacles stand in the way of the flagship policies of Ghana’s President, who was re-elected in December 2020.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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FEATURES /

Paul

Kagame INTERVIEW

‘This is a crucial turning point’ In France for President Macron’s Africa summit, Rwanda’s president had much to say about the two recent reports on the genocide, relations with his neighbours and criticism of his regime

Interview by FRANÇOIS SOUDAN and ROMAIN GRAS

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VINCENT FOURNIER FOR JA

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FEATURES / INTERVIEW / Paul Kagame

T

“This time, I’m staying in a Parisian hotel without the risk of the police knocking on my door!” It was with a smile and a reminder about a 30-year-old event that President Paul Kagame greeted Jeune Afrique in a lounge of the Peninsula Hotel. He was in Paris as one of the VIP guests at President Emmanuel Macron’s summit on African economies.

The occasion he was referring to took place in September 1991. After visiting the French foreign ministry on the Quai d’Orsay, the man who was then the leader of a rebel front fighting against the government in Kigali was arrested at dawn in his hotel room, held at gunpoint and taken to an unknown location, where he was interrogated for 24 hours before being released.

If Kagame has not forgotten those moments, or the role played by the French government before, during and after the Rwandan genocide, he believes in the power of relationships and of moving on. And so it was with more pragmatism than sentiment that, in May 2021, he willingly shared the stage with his new friend, France’s Emmanuel Macron, for whom he is nothing short of a “role model” for the African continent.

Something of an elder statesman now, the 63-year-old is still courts controversy, at home and abroad. With journalists he can be direct

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or he can be allusive – it all depends. But he doesn’t duck the questions.

[Editor’s note: This interview was conducted on 18 May in Paris and was completed by telephone two days later from Kigali. It has been lightly edited for clarity.]

The Muse Report [commissioned by Rwanda] and the Duclert Commission report [commissioned by France] both conclude that France bears ‘heavy’ responsibility for Rwanda’s genocide, but dismiss the accusation of complicity. Has the truth finally been told and have all responsibilities been established?

PAUL KAGAME: These two reports were very important for relations between our two countries. But there are different aspects.

First of all, I don’t know what the phrase ‘all responsibilities established’ means to you.

It’s not that easy to sweep everything away.

Each responsibility is critical. Second, the two reports do not reach the same conclusion.

Ours does not rule out complicity. It merely raises questions that, if pursued, would lead to that conclusion.

I stand by what was established very clearly in these two reports, namely the notion of heavy responsibility. Whether there was complicity or not we leave to individual interpretation.

Kagame with the DRC’s President Félix Tshisekedi

PAUL KAGAME FLICKR

PAUL KAGAME FLICKR/AFP

Meeting with the Duclert Commission in May 2021

‘I stand by what was established in the two reports: the notion of heavy responsibility’

I think that, despite slight differences in their conclusions, these reports lay a solid foundation for building a better relationship between our two countries. Today, we have done 85 to 90% of the work to normalise things, and I don’t think we need to waste time on the other 10 or 15%. We will build on what we have accomplished and move on.

You have dealt with five French presidents.

Your relations with these counterparts have had their ups and downs. Does the election of Emmanuel Macron mark a definitive turning point?

It’s a crucial turning point. To be quite honest, we had constructive exchanges with Nicolas Sarkozy. I remember that we met in New York when he was half way through his mandate. It was the first time we talked. We looked each other in the eye and talked about the difficult relationship between our two countries, about this very complicated history. He then came to Kigali, in February 2010, and we visited the Genocide Memorial together. This was a small opening in the relationship between France and Rwanda, in which he played an important role.

Unfortunately, the rapprochement he began was never completed. When Emmanuel Macron was elected, he set out a very clear path to

advance the relationship between Rwanda and France. This is what made it possible to set up the Duclert Commission. It also opens the way for further rapprochement.

It takes courage to start this kind of process.

Courageous people are not only found on the battlefield. They are also those who make decisions that go against what others expect of them – decisions that expose them. Emmanuel Macron had that courage.

Many major media outlets, many NGOs and, more recently, the UN Human Rights Council have denounced the lack of freedoms in Rwanda. How do you respond to these claims?

What do you want me to say? It is like a broken record. Rwanda has been hearing this for 27 years. Sometimes I think it’s because these people are too lazy to see the reality of things on the ground; either that, or it’s the effect of some form of guilt. Because what happened in Rwanda during the genocide did not just involve Rwandans.

A significant number of players, including rich and powerful countries, had a role during this period, but they refuse to be held responsible. They therefore have to reverse the responsibility by accusing the Rwandan authorities of being the source of Rwanda’s

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FEATURES / INTERVIEW / Paul Kagame

‘For us, it’s not possible to be anyone’s subordinate.

We do not accept to be used’

problems. This is a form of racism and contempt that began during the genocide, when part of the population was systematically murdered.

But how do you explain the reactions that target you personally, often in a passionate way?

It’s true that we are attacked on a daily basis, whether it is me or the Rwandan Patriotic Front (RPF). At the same time, you have people in France, in Great Britain, in Belgium, some of whom are murderers who killed in 1994, during the genocide. In most cases, we have difficulty bringing them to justice. Whether they are found innocent or guilty is a matter for the courts, but these countries do not even try them, they protect them. Some people would even like to see these people come back to power in Rwanda to run the country.

It’s cynical, but we live with it.

At the beginning of the year, British journalist Michela Wrong published Do Not Disturb, a book that is very critical of the RPF and your regime. Have you read it?

I don’t need to read this nonsense. But I want people to read it and make up their own minds. The purpose of this book is solely to destroy what we have built. But the truth is getting harder and harder to distort. They may attack us from all sides, but they still see a country emerging from destruction. These are undeniable facts.

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PAUL KAGAME FLICKR

The case of the oppositionist Paul Rusesabagina, who was arrested in August 2020 and is on trial in Kigali, has caused strong reactions from the international community. How do you respond to those who say he was kidnapped?

There are two distinct aspects to this case. The first is the process that brought Rusesabagina to Kigali. The second is whether Rusesabagina is guilty or not. We must stop mixing the two. If it were established that he was arrested illegally, then it would be possible to argue this point, to make it a separate procedure and to debate it. But if, on the other hand, someone tells you that this same Rusesabagina has been a member of a terrorist group attacking Rwanda for several years, and that this is supported by evidence being presented in a court of law right now, this cannot be ignored.

The Rwandan first family, including Ivan (3rd left) and Ange (3rd right)

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

After five years of tension, relations with Burundi seem to be normalising. What has allowed this new approach?

Perhaps the change of government played a role. Or perhaps, with time, they have started asking the right questions. Why continue on this path? Why continue to fuel these tensions when a calmer relationship would benefit us more than a conflict?

Does this mean that you no longer see Burundi as a potential threat?

No, that is not what I mean. When a neighbour is a source of tension for your country, you try to deal with that problem, but also with what is behind it. If someone supports one of my enemies, then that means I have two problems to deal with. The one who crosses the border to attack me and the one who supports him in the shadows.

The situation with Uganda, on the other hand, is not improving, despite a promising start to the mediation.

Have you lost confidence in President Yoweri Museveni?

This story is not just about trust between Museveni and me. It has been going on for maybe more than 20 years. I’m never very comfortable talking about this, but I’ll sum it up this way: for us, it’s not acceptable to be anyone’s subordinate. We do not accept to be controlled or used. If you can read between the lines, you can understand what I mean. In this relationship, there can’t be a big brother telling the other ‘do this’ or ‘do that’. We have a country to run. If a neighbour wants to attack our sovereignty, to destabilise us with armed groups, we cannot accept it.

worked. It worked for a few days or a few weeks, and then, after a month or two, we had problems again. It has been like this for years.

Now there is hope that things will improve on the ground. If we listen to each other, especially as neighbours with a common history, good and bad at the same time, it allows us to better protect each other on both sides. That’s what is happening today.

Nobel Peace Prize winner Denis Mukwege is campaigning for the creation of an international criminal tribunal on crimes committed in the DRC, based on the UN’s ‘Mapping Report’. Why are you opposed to this approach?

I don’t know if you have studied the Mapping Report. This report was created to give credibility to the idea of double genocide – a theory that transforms victims into executioners. A report like this should have shown the perpetration of crimes committed by parties other than Rwanda. The people behind this are funding Mukwege. It’s part of this new NGO narrative around these events. It doesn’t take away from the good things that Dr. Mukwege has done, treating women who were raped.

Your relationship with [DRC president] Félix Tshisekedi is undeniably better than the one you had with Joseph Kabila.

Does it rest on a more solid foundation?

I don’t think it would be hard to do better than at the time of the previous Congolese administration. We did everything we could to improve things with Kabila, but it never

KING OF KIGALI? 23 October 1957 Born in Tambwe, Rwanda 1994 Became de facto leader of the country after the Rwandan Genocide 22 April 2000 Became President of Rwanda 2015 Constitutional referendum creates the possibilty for Kagame to stay in power until 2034 28 January 2018 Took up the rotating chair of the African Union Commission and launched a reform programme

A year ago, your son Ivan was appointed to the board of directors of the Rwanda Development Board (RDB). Your daughter, Ange, is involved in philanthropy and serves as an informal adviser in the government. Aren’t you afraid of being accused of nepotism?

If that were the case, my son would be RDB president or a minister. My daughter is married and lives in Rwanda. She decided it would be easier to work with me than to get a job somewhere where she would be treated differently because she is the president’s daughter. Here, she’s on a team of nine people that she doesn’t manage; she just gets involved in the areas that are hers, in a technical capacity. She has no authority over this group.

It’s not an easy situation to deal with, I agree. If I involve my children too much, I’ll be accused of giving them privileges. If do the opposite, that would be denying them their rights as Rwandan citizens. It is a dilemma, so we are looking for something in between. But you won’t hear about the kind of excesses that make headlines in other countries. Rwanda is not a monarchy.

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FEATURES /

Sudan’s WIDE ANGLE

Turning the economy around, reforming the constitution, holding elections and dealing with the military are some of the major challenges facing the post-revolution government in Sudan

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new dawn

A new day starts in Khartoum THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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ABDULMONAM EASSA/GETTY/AFP

By NICHOLAS NORBROOK

FEATURES / WIDE ANGLE / Sudan’s new dawn

S

Sudan’s Prime Minister Abdalla Hamdok delivered his message emphatically – “we have to rebuild our economy if our political transition is to work.” That means listening to the calls for economic opportunities from the hundreds of thousands of revolutionaries who had mobilised across the country against the brutality and corruption of then president Omar al-Bashir and the Islamist National Congress Party regime.

For Hamdok, the high-level conference in Paris on financing Sudan’s rebirth was a critical staging post. Held in May, two turbulent years after the ousting of the Bashir regime, the Paris conference elicited pledges for a restructuring and partial cancellation of Sudan’s more than $50bn in foreign debt. More than debt and IMF programmes, Hamdok wanted the Paris conference to showcase the development and commercial possibilities in Sudan in areas such as modernising agriculture, digital transformation and renewable energy.

Formerly the top development economist at the UN’s Economic Commission for Africa, Hamdok emerged as the favoured candidate for the premiership in the wake of Sudan’s revolution. As a technocrat who had repeatedly rejected job offers from Bashir’s regime and had been critical of its policies, Hamdok had credibility with the young revolutionaries. It

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‘You need some sense of stability in a region at risk of going up in flames’

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

was also Hamdok’s quiet determination and ability to rally international support for Sudan that led the country’s highly factionalised military and security agencies to accept him as prime minister. They may have hoped that the intricate three-layered transitional government – the ruling sovereignty council on which the military and civilians share power, the council of ministers, dominated by the civilians, and the legislative council – would prove so difficult for Hamdok that it would make far-reaching reform impossible.

Consultative process

Hamdok has proved them wrong on that. A slew of economic, administrative, judicial and now constitutional reforms are under way. The next step will be a constitutional conference, promises the prime minister: “[It] will be not an event, but a wide-ranging consultative process” – a process that he hopes will help unite the country’s diverse ethnicities and regions.

“For 60 years we failed to get together around a national project”, says Hamdok.

“The revolution [which started in December 2018] provided that opportunity, and we should seize it.” Creating a parliament and organising elections – slated for 2022 – are due to be the final stop on that journey. Sudan’s transition

JOAO SILVA /NYT/REDUX/REA KAY NIETFELD/ZUMA PRESS/ZUMA/REA - ALL RIGHTS RESERVED

The land around Gezira has huge potential

faces two hefty threats – economic breakdown and destabilisation by military spoilers who have outside allies. Beneficiaries and loyalists of the Bashir regime have tried to sabotage the economy, which has been plagued by shortages of essential commodities, inflation of more than 300% and frequent power cuts.

Hamdok’s economic diplomacy in Paris will help. Sudan has had $3.1bn in arrears to the African Development Bank, World Bank and IMF paid off by a coalition of the US, France, the UK and others.

The Paris Club of official creditors is to clear most of the historic debts. The World Bank and the IMF are fast-tracking Sudan onto the Highly Indebted Poor Countries (HIPC) scheme. That should start at the end of June.

“Sudan is crippled by its debts, which are mostly interest, as the Bashir regime never paid any of its debts for 30 years”, says Sudanese telecoms billionaire turned governance campaigner Mo Ibrahim. “It locked out Sudan completely from the international system, from its institutions and funds.”

What’s at stake? “You need some sense of stability in a region at risk of going up in flames,” says Suliman Baldo, senior adviser at US-based monitoring group The Sentry. He points to the war in Ethiopia’s Tigray region and also the conflict in Benishangul-Gumuz, which borders Sudan.

“It’s about the size and the importance of the country,” says Hafez Ghanem, the World Bank’s vice-president for East and Northern Africa. He agrees that the strategic importance of Sudan has focused minds. “This is the largest HIPC arrears clearance ever, and

it is not just international but the regional partners who have mobilised.”

The presidents of Ethiopia, Egypt and Rwanda and the chairman of the African Union Commission all attended the Paris meeting on Sudan. “First movers in new markets are the biggest winners,” said Afreximbank boss Benedict Oramah, as he promised $750m in trade-related finance.

Breadbasket of the region

Many at the meeting pointed to Sudan’s macroeconomic reforms over the past 18 months: cuts to fuel and power subsidies, dropping multiple exchange rates, tax reform and negotiations with the World Trade Organisation. A new investment law, a public-private partnership law, greater independence for the central bank... the list goes on. As the business climate starts to improve, the country is coming into focus for investors, too.

Artisanal miners are producing gold in 14 of Sudan’s 18 states. Only 48% of the country is covered by mobile telephony, and the government is looking for $2bn of investment. Railways connecting Khartoum to Ethiopia are envisaged. “Sudan should be the breadbasket of the region,” Africa’s leading industrialist Aliko Dangote tells The Africa Report. Nigeria’s Dangote says the proximity to consumer markets in Egypt and the Gulf is tempting him into flour processing there.

“The best way to link farmers to markets are partnerships between farmers, agro-processors and foreign investors, perhaps through outgrower schemes,” says the World Bank’s Ghanem.

“Only 30% of arable land is used today

Hamdok and his reformers

ABDALLA HAMDOK

KHALID YOUSIF

MOHAMED AL-ABDEIN

YASSER ABBAS

Due to deliver a constitution and elections in 2022.

The cabinet minister plays a key coordination role.

The central banker is getting the economy on track.

The minister is in talks with Ethiopia about its mega-dam.

ABDULRAHMAN OTHMAN Khartoum’s oil and gas minister.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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FEATURES / WIDE ANGLE / Sudan’s new dawn

in Sudan.” Who owns that land – and who benefits – were some of the flashpoints behind the December revolution.

For Ibrahim, much more work needs to be done on ensuring equitable access and developing new projects. “It was a little bit sad to for me to watch the presentations, and see the Gezira project presented as the largest irrigated agricultural project in the world,” says Ibrahim. “Do you know who established that project? It was the British during the colonial period. What have we done since then?”

Pain now, gain later

‘When you sign a peace agreement you are closing one page and opening another’

Another focus for the government is energy.

“The cost of producing from solar has come down to $0.025/KWh – that is an unbeatable price,” says Ghanem. Solar power supports mini-grids and off-grid solutions, which save on costly transmission lines. “All this allows you to be really ambitious in trying to achieve universal access to electricity.”

But while Hamdok and his teams are trying to recreate a solid base for the country, time is not on his side. “The danger from these kinds of reforms is that the pain is immediate, while the benefits take longer to be seen,” says Ghanem.

Cars queue from dawn to ensure they get the few tankfuls of fuel available each day. In early April came the big revelation: the publication, with no fanfare, of a partial list of the opaque state-owned enterprises (SOEs) that make up the bulk of the Sudanese economy (see box). For The Sentry’s Baldo, tackling the state-owned companies is essential to mitigate the political risks in the transition.

These parastatals are part of an “elaborate kleptocratic system” that remains largely under the control of the military. Sudan’s finance ministry controls just 18% of the revenue that SOEs and government agencies generate.

For the Sudanese, “there is an understanding about what the problem is – that these companies are denying the wealth of the country to the people – and they want to see action there, some level of easing of their condition as the government controls more resources,” says Baldo. He underlines the political tightrope the Prime Minister is on.

“Failure to do so would mean people would no longer unconditionally support Hamdok.”

Hamdok chose Jibril Ibrahim as his new finance minister. A poacher-turned-gamekeeper, Ibrahim leads a Darfur rebel group, the Justice and Equality Movement. He is best known for being the man to almost take Omdurman in 2008, before the Sudanese army managed to repel his forces from the gates of Khartoum.

Does that past make it tricky to be the man paying the army its wages today? “When you sign a peace agreement, you are closing one page and opening a new one. At the end, you are a Sudanese. And if you take the position of the minister of finance, you are answerable to the whole country. It is not a matter of love and hatred, it is a matter of duties,” says the minister. “Of course we need to think of a new army,” he adds. “That is one of our conditions, that we need to restructure the whole security sector so that it will be reflective of the components of the Sudanese society and reflective of the understanding of

Securing assets The Omar al-Bashir regime put vast chunks of the economy under the control of the security services – police, army and intelligence. The army controls irrigation projects, meat-processing plants, import-export activities, retail operations and manufacturing units. The police turned every service they deliver – from passports, to identity cards, to number plates – into a company.

When Bashir was ousted in April 2019, the army moved to consolidate power in various lucrative sectors previously run

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by the intelligence services. Sabika, a gold bullion company that supplies the central bank, comes under the control of the National Intelligence Services, says Suliman Baldo of the US-based The Sentry think tank.

So far the transitional government under Prime Minister Abdalla Hamdok has scored two small but vital victories: first, publishing a partial list of stateowned entreprises. Second, it got control of the state-owned media, news agencies and printing houses, used for

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

“propaganda, for controlling the thinking of the Sudanese and shaping their reading of events”, says Baldo.

To get around US sanctions, the Bashir regime registered companies in the names of binational Sudanese. Going after them will require rigorous inventory and mapping work.

“Start with civilian national funds and ministries, and all off-the-books accounts. If they just do that, it would be huge”, recommends Baldo, who is impatient for reform.

Pragmatism

Jibril Ibrahim will also be able to deliver realism to the Darfur peace agreement, which has ambitious clauses about how much revenue will be allocated to the region. “As finance minister, he will know exactly what the government can deliver, and his word will be respected,” says Baldo.

This pragmatism flowed through Hamdok’s position on recognising Israel – a very transactional piece of diplomacy from former president Donald Trump’s White House that saw Sudan removed from the State Sponsors of Terrorism list and receive $1.15bn in bridging loans.

Having brought the US onside, Hamdok is benefitting from renewed pressure on the Gulf countries, which may help with his other great problem: how to deal with the Rapid Support Forces (RSF). The RSF is a paramilitary group; in recent years one of the most powerful groups in the country. Its leader, Mohamed ‘Hemedti’ Hamdan Dagalo, controls several gold mines, including the lucrative Jebel Amer mine in North Darfur. He is deputy chair of the sovereign council chaired by Lieutenant General Abdel Fattah al-Burhan, who represents the interests of the regular armed forces.

Unlike the army, which set up SOEs, the RSF set up private companies, which the government pays as contractors. They have sold their services as mercenaries to the region, doing much of the heavy fighting on behalf of Saudi Arabia and the United Arab Emirates in Yemen, and also in Libya and Syria. “The Emiratis are getting the message that they cannot survive

IBRAHIM AL-OMARI/AFP

what our military is supposed to do and what the constitution asks them to do, rather than being aligned to any of the political parties.”

For Baldo, it is a smart hire on several levels. First, Jibril Ibrahim will be hard to coopt by an army keen to retain its privileges.

In March, Hamdok and Ibrahim visited the beating heart of Sudan’s military industrial complex – Defense Industrial Systems, on the outskirts of Khartoum – and Ibrahim spoke to the commanders. “And he spoke to them very candidly, saying, ‘Your companies, they need to be transparent. The public needs to know the operations, what you are making, how much money. And you need to pay your taxes.’ Just like that!” says Baldo. “They never heard anyone telling them what they should be doing before. They need to hear it!”

JIBRIL IBRAHIM Finance minister of Sudan and leader of Darfur’s Justice and Equality Movement

‘Our banks are too weak’ How are you taking back control of state-owned enterprises (SOEs)?

In the past, companies owned by the military used to have tax exemptions, customs exemptions... but no exemptions now. Any commercial company needs to be treated like any other commercial company. And they have to pay their tax. We are working on how we bring all the SOEs under the control of the ministry of finance.

How do you assess the health of your banks?

For the short period I have been at the ministry of finance, I felt that our banks are too weak. They have very little capital to help them finance real projects. One of the things I discussed with the central bank governor is we should think of merging these small banks to create banks with enough capital to be real banks. And not only that but invite foreign banks to come in and buy shares in these banks. So we need to prepare these banks for selling.

How will the unification of the Darfur affect stability in the region?

The Darfurians have a shared history of 400 years, if not more. They have the feeling they have one identity – though they fight among themselves on an ethnic basis. For a long time, the Darfurians kept asking for unification of the states. In the peace talks, we asked for the return of the old region system. When the colonial regime left, we had nine states. Three were dropped because the south seceded. All those who belong to the regions, especially who have been marginalised for a long time, think this unification will give them power in negotiating with the centre. Instead of being small states, they will be a big block, and the centre will assist them more

without a partnership with the US,” says Baldo, “and they are reducing their funding for Haftar in Libya [and] to Hemedti in Sudan.”

It is no guarantee of stability, however.

Tensions are emerging between the RSF and the army, with the latter keen to integrate the RSF into the regular forces. Hamdok has little leverage over these groups.

The political integration of military forces will be critical to the long-term success of Sudan’s transition. If the chairman of Sudan’s Transitional Sovereignty Council and commander of the Sudan Armed Forces, Lt. Gen. Abdelfattah al-Burhan, or any other general wants to enter any future electoral process, “they must take off the khaki”, says Mo Ibrahim. “It is very important for the army to accept the sovereignty and the civilian government of the country. We create armies to protect our borders, not to rule us.”

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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FEATURES /

Akufo-Addo’s PROFILE

second-term test 40

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Akufo-Addo is more popular than the NPP party he leads

FRANCIS KOKOROKO/REUTERS

Having scraped through with 51.3% of the vote in the 2020 presidential election, Nana Akufo-Addo faces a hung parliament, falling export revenues and mounting debt as he tries to push through his cherished policies

By JONAS NYABOR in Accra and PATRICK SMITH

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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FEATURES / PROFILE / Akufo-Addo’s second-term test

S

Striding across the political scene for four decades, Nana Akufo-Addo was once seen as a rebel – a Nkrumaist at university and an anti-corruption and pro-democracy activist in the era of Jerry Rawlings and the Provisional National Defence Council. Now he has emerged as an ideal-type pragmatist with two presidential election victories under his belt.

The enthusiasms for leftism and Nkrumaism are long gone. Akufo-Addo’s father, Edward, was one of Ghana’s founding fathers and followed Kwame Nkrumah as president.

Today, his son embodies the Danquah-Busia tradition on the right of Ghana’s spectrum.

Akufo-Addo and Rawlings reconciled comprehensively, long before the latter’s sudden illness and death last year.

Rawlings, despite founding the National Democratic Congress (NDC), which is now in opposition, became one of Akufo-Addo’s strongest supporters. This was based more on personal chemistry than ideology, and was reinforced by Rawlings’s falling out with John Mahama, the NDC’s unsuccessful presidential candidate in the 2016 and 2020 elections.

It has worked out politically. Akufo-Addo has been consistently more popular than his party – the New Patriotic Party (NPP), often criticised as elitist and detached from popular concerns. That has spared him the flak for some of the NPP government’s most unpopular moves: such as its botched attempt to privatise part of the state electricity company, or

42

the plan to float a gold royalties company, Agyapa, in London and Jersey.

When the Agyapa plan hit a wave of hostility from civil society, the opposition NDC and the government’s own special prosecutor, it was Akufo-Addo who brokered a compromise, announcing that the plan to float the company would be deferred until after last December’s presidential elections.

That election changed Akufo-Addo’s political fortunes. He won the presidency against the NDC’s Mahama but with an official 51.3% of the vote – a much slimmer margin than his landslide in 2016.

A bigger problem for him is that the NPP and the NDC tied for control of parliament.

The NDC gained 31 new seats and the NPP lost 32. Each party has 137 seats in the 275seat parliament. The balance of power is with an independent member of parliament.

A self-described “man in a hurry”, AkufoAddo has to keep 100% loyalty in the NPP caucus and try to win over some votes from the opposition benches to push through some of his cherished policies. Without that, there is a danger that his second term could be brought low by a combination of economic downturn, mounting debts and protests by frustrated young people.

A new protest movement

Early this year, a group of young activists formed the ‘Fix Ghana’ coalition, a group that resembles the Red Friday movement that marched against corruption and unemployment under Mahama’s government in 2014 and 2015. Mobilising trade unionists, students and civic activists, Red Friday contributed to the defeat of Mahama in the 2016 elections. That might explain the panicked reaction by the NPP government to the ‘Fix Ghana’ crowds.

Ministers have alternately summoned the movement’s leaders to meetings to hear their grievances and banned their marches. ‘Fix Ghana’ lambasts both parties for failing to create jobs or enough technical training as patronage and corruption flourish.

The hung parliament could hobble AkufoAddo’s second term and empower the NDC. With skilful organisation, the opposition could block big government contracts, ministerial appointments and plans for more borrowing.

It was clear on 6 January, the night of the new parliament’s inauguration, that there

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

A ‘man in a hurry’, Akufo-Addo needs opposition votes for his policies

FEATURES / PROFILE / Akufo-Addo’s second-term test

would be a challenge to Akufo-Addo’s choice of speaker. His preferred candidate, Aaron Mike Oquaye, lost the vote to the opposition’s choice, Alban Bagbin, in a heated contest. Tempers flared and the police were called into the chamber. It was an inauspicious start for the NPP, showing it to be outmanoeuvred by its opponents.

A veteran operator, Bagbin will make the most of the powers vested in the speaker, but he insists he will be neither “obstructionist” nor a “rubber stamp”. He was one of three senior NDC politicians to excoriate Mahama’s presidency, and he has not ruled out a run for the top job ahead of the 2024 elections.

After the clash over the speaker, the next contest was Mahama’s petition to the Supreme Court asserting that Akufo-Addo’s victory was illegitimate. Although Mahama hired an impressive team of lawyers headed by the redoubtable Tsatsu Tsikata, the petition failed after weeks of legal disputation. And the petitioners’ attempts to get the volatile Jean Mensa, chair of the electoral commission, to testify in court were thwarted.

Free senior high school has been one of AkufoAddo’s most popular policies

¢3bn every month and ¢36bn a year,” said the NDC’s deputy spokesman on finance, Isaac Adongo. “Quite clearly, the numbers are showing a very scary picture.”

The IMF reckons Ghana’s fiscal deficit hit 16% of GDP last year, the second-highest in Africa. The deficit will stay high, at least double the 5% level prescribed in the IMF’s Fiscal Responsibility Act. Part of this is due to the government’s ¢113.7bn spending plan and a shortfall of revenue this year. This means Ghana’s external and domestic debt will rise further, after reaching 76% of GDP last year, up from 62% in 2019.

Education - oil = debt

Second-highest fiscal deficit in Africa

Since then, the opposition has picked its battles, harshly questioning some of the NPP’s more dubious ministerial nominations but focusing mostly on claims that the country’s economic hardships are due to bad policies, nepotism and corruption. Its parliamentarians point to the country’s rising debt stock, accusing the government of setting the economy on a dangerous path.

“The NDC was adding an average of ¢1.15bn ($197.8m) to our public debt every month and a total of ¢13bn a year, but President Nana Addo Dankwa Akufo-Addo is adding DEBT VERSUS GDP GROWTH General government gross debt (% of GDP)

Real GDP growth (annual % change)

15

80

10

60

5

40

0

20

-5

0 1980

44

-10 1885

1990

1995

2000

2005

2010

2015

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

2020

2025

SOURCE: IMF

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Ghana’s debt level is of concern but not heading for a crisis if managed carefully, according to Professor Peter Quartey, director of the Institute of Statistical, Social and Economic Research (ISSER) at the University of Ghana.

“We can’t say Ghana should not borrow at all. We ought to borrow, but rather we need to borrow responsibly and we ought not to increase the debt-to-GDP ratio,” he tells The Africa Report. Quartey adds that the government must step up its digitalisation programmes to boost domestic revenue and find non-tax revenue sources such as dividends from profitable state-owned enterprises.

Financing a free secondary education programme mainly from Ghana’s oil revenue, the Akufo-Addo government has ensured a year-on-year increase in senior high school enrolment since 2017. That has proved to be Akufo-Addo’s most popular initiative but also one of the toughest to deliver. School enrolment has increased by 69% since 2017, but the treasury’s coffers have not kept pace.

“The greatest challenge of the government will be how to continue with the Free SHS programme in respect of the increasing enrolment,” says Kofi Asare, the executive director for Accra-based Africa Education Watch. “In 2017, it had 900,000 students; now it is 1.3 million. In the first year [2017] it was about ¢400m; last year it cost ¢2.4bn.”

Oil revenue, meanwhile, is shrinking under the current unfavourable market conditions.

As the world shifts to green energy, Ghana’s oil earnings will come under more pressure, with or without more pandemics.

Nana Amoasi VII, executive director for the Institute for Energy Security, argues

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FEATURES / PROFILE / Akufo-Addo’s second-term test

NDC

Free secondary schooling will pay its dividends in the years to come

that the state-owned Ghana National Petroleum Corporation (GNPC) should find ways to raise output. “Ghana cannot control the international price of oil but it can control domestic production volumes. In the past three years, we’ve seen stagnation in terms of production,” he says.

Denis Gyeyir, a programme officer at the Natural Resource Governance Institute in Accra, concurs: “If the government fails to invest in exploration, it is going to have production either stagnant or declining.”

Planting crops and building plants

Economic planners in Accra have other options in what is one of West Africa’s more balanced economies: oil is a recent addition to the traditional exports of cocoa and gold.

But all of these, exported without significant processing, fail to meet Akufo-Addo’s test of local value-added. The government has been working with Côte d’Ivoire to push up cocoa prices, as the two countries produce more than two thirds of world production, and to coordinate on local processing.

The Ghanaian government has also been investing in a wider range of crops, focusing on six tree crops as part of the its agro-industrial strategy. This is part of its efforts to deliver on its 2016 pledge of one factory in each of Ghana’s 260 districts.

Akufo-Addo has been touting the establishment of a Volkswagen assembly plant in Accra as a sign of the country’s conducive business environment. Toyota and Nissan have also signed agreements to build factories in Ghana.

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Trade and industry minister Alan Kyerematen is an international trade expert with an eye on running for the presidency in 2024. Making the industrialisation policy work would greatly help that campaign, but it would need funds and some national coordination. Factories have to be planned where they have easy access to local natural resources as well as a clear route to the domestic and export markets.

The government wants to capitalise on the opportunities for tariff-free commerce opened up by the African Continental Free Trade Area, which has its secretariat in Accra. As in most African states, there is no shortage of dynamic and innovative young entrepreneurs in Ghana.

Ghana, however, falls short on infrastructure, particularly road and rail networks and electricity. When the dumsor (‘on-off’) crisis hit the country in 2013-2016, it was Mahama’s government that brought in a raft of power suppliers, racking up billions of dollars of debt.

Untangling those commitments and working out how much power Ghana can generate on a commercial basis has tested the AkufoAddo government’s ingenuity. And, like its predecessors, it has let a cluster of heavily overpriced procurement contracts continue to drain money from the treasury.

Meeting those three ambitions – sustaining secondary education, stable electric power and industrialisation – is a self-imposed target for Akufo-Addo. That was long before he had to contend with a pandemic, a weakening oil market and spiralling debt obligations. To pass the finish line, much has to be done in the next three years.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Untangling power contracts has tested the government’s ingenuity

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DRC

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Tshisekedi takes charge

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

EPA/STR

Tshisekedi at the African Union, which he chairs for a year until February 2022

Having outmanoeuvred former president Kabila and his allies, the DRC’s President Félix Tshisekedi faces an even tougher challenge: raising money to deliver on his vastly ambitious spending programme ahead of elections in 2023 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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DRC FOCUS / Tshisekedi takes charge

By PATRICK SMITH and STANIS BUJAKERA TSHIAMALA

succeed in implementing policies and managing the country. […]

When you have formed a coalition, you are not going to reproach its members for saying that they think they can be useful to the country.”

Some of the compromises have involved Tshisekedi’s rivals, such as Moïse Katumbi [former governor of mineral-rich Katanga] and JeanPierre Bemba. Muyaya emphasises the positive: “We saw something unprecedented: 410 deputies out of 412 present supported the government’s formation. And this is not a blank cheque!”

Bemba and Katumbi, both of whom harbour presidential ambitions for 2023, have joined Tshisekedi’s plan for their own reasons. They will stay relevant under the new structure, which includes four deputy prime ministers. They have each nominated one: Bemba’s choice is environment minister Eve Bazaiba Masudi and foreign minister Christophe Lutundula is Katumbi’s.

Vital Kamerhe, Tshisekedi’s jailed former chief of staff, has

No one could accuse President Félix Tshisekedi’s government of lacking ambition. When he took control of the cabinet and parliament in April this year, after two years of wrangling with his predecessor, Joseph Kabila, Tshisekedi announced 343 new initiatives.

Formidable as it looks, Tshisekedi’s gargantuan to-do list, which his allies say includes urgent economic and social reforms that were held up by Kabila, may benefit from an economic rebound in 2021. Helped by rising commodity prices and its promises of reform, Tshisekedi’s new government has been able to win more backing from multilateral and bilateral financiers. For now, the biggest problems are more political than economic and technical.

Unity rewarded

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343

The number of economic and social reforms Félix Tshisekedi’s government claims it must carry out urgently

Money, money, money

Conducting that vast orchestra will test Tshisekedi’s political skills and deal-making to the limit. An immediate problem is the lack of funding for the reform agenda.

No one has a clear plan on how to finance the government’s target budget of $36bn for the next three years. Says Muyaya: “The $36bn must be understood as an ambition. The main thing is that we have the will to mobilise all the additional resources, to put them at the service of the country’s development.”

Prime Minister Kyenge is targeting $12bn a year, of which $7bn was recently allocated.

“We mobilise each year around $3.5bn-$4bn of our resources,” sighs an elected member of the Union Sacrée. “It would be an illusion to think we could find the necessary [money] to fill the budget in such proportions.”

And the shopping list is getting longer. The government has promised to pay retired civil servants the pensions they have been owed dating back

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Tshisekedi’s success in wresting full power from his predecessor started with the sacking of Kabila’s chosen prime minister, Sylvestre Ilunga Ilunkamba in January. It took another three hard months for him to consolidate the grip of his Union Sacrée coalition in the national assembly and appoint an expansive cabinet under the new prime minister, Sama Lukonde Kyenge, on 12 April.

Communications minister Patrick Muyaya says the 57 ministers are “necessary to ensure that all 26 provinces were represented” and points out that “the size of the government was still reduced by 15%.”

Some critics argue that the compromises made in putting together the government will hamper it as officials try to parcel out resources to their constituencies. Muyaya dismisses this: “For us, creating the Union Sacrée was a struggle. […] Beyond the will to conquer power, the initial ambition is to

five ministers in the government.

And new Senate president Modeste Lukwebo has four members of his party, including Adèle Kahinda Mayina, the minister for stateowned enterprises.

MESSAGE

DRC FOCUS / Tshisekedi takes charge

$1.5bn

Copper and cobalt are enjoying a price boom

decades. It also has to find cash – as much as $500m – to pay for the 2023 elections.

Tshisekedi has inherited a complex and costly system of 26 provincial governments with 260 provincial ministers. They are meant to receive 40% of national tax revenue but have had almost nothing for several years. This has triggered a fiscal crisis in many provinces.

Some help may be on the way from the International Monetary Fund (IMF), with which Tshisekedi’s new finance minister, Nicolas Kazadi, negotiated a $1.5bn credit in late May. The loan is to assist Congo’s recovery from the ravages of the coronavirus pandemic. It is conditional on the Tshisekedi government launching still more initiatives, such as

SOURCE: CONGOLESE AUTHORITIES AND IMF STAFF ESTIMATES

CONTRIBUTION TO REAL GDP GROWTH 12 9 6 3 0 -3

2006

2008

2010 2012 2014 2016 2018 2020

Agriculture Extractive industries Secondary sector

52

Tertiary sector Import duties GDP Growth

wholesale reform of the internal revenue system. It also requires much more accountable reporting of the billions of dollars generated in export earnings from gold, copper, cobalt, diamond and coltan.

Kabila loyalists on the board

The IMF deal, premised on far greater accountability, could lead to another $3bn in funds from the World Bank over the next three years. Much of that would be earmarked for the restructuring of state companies and reforms to the state treasury’s management systems. That involves the Banque Centrale du Congo (BCC), whose restructuring is reform number 125 on Tshisekedi’s list.

It will mean political battles.

Senior staffers and the board of the BCC are mostly Kabila loyalists and will resist reform that could cut into their lucrative sinecures and side businesses. The bank’s board includes Albert Yuma, the powerful chairman of Gécamines, the state-run mining company.

In mid-May, Kazadi and the World Bank agreed a package of $500m of loans and grants to improve infrastructure in Kinshasa, which is home to about 14 million people. Outside the capital, the Bank is looking at projects to boost water management, power generation and farm production. Expansion of free primary

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

GWENN DUBOURTHOUMIEU

IMF loan agreed in May to assist the DRC in its economic recovery from the Covid-19 pandemic

education, Tshisekedi’s signature programme, has been stalled since the World Bank suspended payments in February on learning that officials were expecting parents to pay the teachers.

In a country of 100 million people, most of whom are struggling to escape poverty, the pandemic has wrought a tough economic toll. After growth fell to 1.7% last year, the IMF forecasts it will rise by 4.9% this year, buoyed by booming prices for copper and cobalt. On this basis Tshisekedi and his team hope to deliver on their uber-ambitious agenda.

Stalling them will be a divided, but tactically acute, opposition. On one wing there is Kabila and the remaining members of his Parti du Peuple pour la Reconstruction et la Démocratie (PPRD). Its goal is to regain power in 2023, but it is yet to announce who its candidate would be. Kabila himself has been playing a cautious game. Some say he fears arrest, now that Tshisekedi controls the security agencies.

A determined opponent of both Kabila and Tshisekedi, Martin Fayulu presides over another wing of opposition, making speeches that sound like a campaign for the presidency in 2023. Fayulu was upheld by many independent organisations as the legitimate winner of the 2018 elections.

As Tshisekedi tries to manage the leviathan that is the DRC’s new government, Fayulu is using the country’s current political openness to bolster his coalition. Whether Fayulu can keep that support base together will depend critically on how successful Tshisekedi is achieving his 343-item agenda.

With a little more than 1,800 employees, 100 points of sale, a representative office in Brussels and a consultancy office in Beijing, almost 450,000 customers, and a 27% market share, RAWBANK supports the development of the Congolese economy. Since its creation, Rawbank has been rated by Moody’s and certified ISO/IEC 20000 and ISO/IEC 27001. For 19 years Rawbank has maintained its position as the leader in the banking sector by securing profitability in the DRC’s evolving economic environment.

Rawbank is now one of the 16 founding members of CAIBA (China Africa Inter-Bank Association) founded in 2018 along with international and Pan-African banks such as Standard Bank, Absa, Attijariwafa etc., in order to strengthen investment links and trade, between China and African countries.

The bank has established financing partnerships with several international institutions (Shelter Africa, TDB, ADB...).

Sustainability and profitability are Rawbank’s operational priorities to consolidate its growth strategy throughout all its segments. Rawbank’s primary concern remains to satisfy its customer base (individuals, companies, public entities, NGOs, institutions) through proximity, tailor-made support, responsiveness, innovation particularly in the digital, adapted products, the branch network ... Thus, Rawbank while being a forerunner since its creation is also a solid and reliable bank.

Rawbank is a growth accelerator. Our mission addresses several challenges that strengthen this growth such as : • • • • •

Putting the customer at the center of all our decisions To offer the numerous services adapted to their needs To constantly innovate Fully integrate digital technology into our development strategy Focus on human capital through our employees.

Digital banking is a key issue in the DRC and that’s why financial technology is an absolute priority for Rawbank as it should bring about change in payment methods and accelerate the banking of the unbanked population. Rawbank’s ambition is to make innovative digital financial products accessible to all Congolese, wherever they are. To achieve this goal, Rawbank relies on a secure digital ecosystem, which offers freedom, user-friendliness and speed in the execution of daily operations from a smartphone.

As a forerunner in the field of digital banking in the DRC, Rawbank has developed the “IllicoCash” solution, which brings together several dematerialized services within a single application. Sending, transferring or withdrawing money, accessing your accounts, topping up your cell phone credit, making international transfers, renewing of cable TV subscription, all these services are available on IllicoCash.

In addition, Rawbank is launching its Payment Gateway Service (PGS), an online payment interface to penetrate Africa’s already booming e-commerce market. This secure e-commerce solution is integrated into the seller’s website, allowing VISA or MASTERCARD cardholders to pay their bills online, directly.

Despite the difficulties linked to the economic consequences of Covid-19, Rawbank has continued to support its customers.

Rawbank is the leading partner for corporates, and is strongly committed to raise its support to SMEs particularly through Lady’s First, a support program with dedicated products to women entrepreneurs who are developing small businesses.

In 2020, the bank tied up into an additional partnership with the Trade & Development Bank, this time for $20 million. The whole credit line is dedicated to supporting large companies and SMEs affected by the consequences of the Covid-19 pandemic in the DRC. Similarly, at the end of 2020, the African Guarantee Fund renewed its confidence in Rawbank through a support of 35 million dollars for SMEs. These partnerships demonstrate the confidence placed in Rawbank by its international partners.

(+243) 99 60 16 300 Free number : 4488

Rawbank

contact@rawbank.cd - www.rawbank.com

Rawbank Sa

Rawbank

ADVERTORIAL

Rawbank introducing a cutting edge mobile application “illicocash” and raising more funds to support SMEs.

DRC FOCUS /

Jean-Marc Kabund-A-Kabund

BENOIT DOPPAGNE/BELGA VIA AFP

President Félix Tshisekedi’s new Union Sacrée parliamentary majority has personalities from different parties and with different points of view.

Find out more about the allies old and new that are key to whether he will be able to achieve his reforms and policy goals.

Modeste Bahati Lukwebo

The defector

Aged 39, Jean-Marc Kabund-a-Kabund engineered the downfall of the Front Commun pour le Congo (FCC), the formidable political machine that guaranteed a certain amount of power for former president Kabila. This makes Kabund one of the pillars of the new majority in government and a key figure on many strategic issues.

He regained his position as first vice-president of the national assembly in early February, after having masterfully led the revolution that brought down the FCC. Kabund had been removed from the parliamentary cabinet in May 2020, but this freed him up to act. With the mobilisation experience he had gained as interim president of the Union pour la Démocratie et le Progrès Social, Tshisekedi’s Cap pour le Changement (Cach) platform found its man to turn the tide in its favour.

On 2 March, supported by the Union Sacrée, Modeste Bahati Lukwebo was elected president of the Senate, replacing the Kabila-supporting Alexis Thambwe Mwamba. However, for many years the senator from South Kivu was one of the influential members of former president Joseph Kabila’s camp. Several times a minister in charge of the planning and economic portfolios, his name was on President Félix Tshisekedi’s shortlist for the post of prime minister, which was awarded to Sama Lukonde Kyenge on 15 February.

As president of the Alliance des Forces Démocratiques du Congo (AFDC), Bahati Lukwebo was open about his wish to lead an institution in the new administration, justifying this ambition by the weight of his party. Until now, the AFDC was the second political force of Kabila’s Front Commun pour le Congo platform, with 145 elected members. Bahati Lukwebo finally quit Kabila’s camp in 2019 after regular disagreements with Kabila and his allies. He then moved closer to Tshisekedi’s Union pour la Démocratie et le Progrès Social and actively participated in the break-up of the alliance between Tshisekedi and Kabila.

He was one of the architects of the Union Sacrée, and on 31 December 2020, the head of state chose him to seek out allies and form a new parliamentary majority.

GWENN DUBOURTHOUMIEU FOR JA

The strategist

54

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

MD SERVICES Sarl: “The practical and appropriate solution for results-oriented personnel management.”

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MD SERVICES Sarl provides you with fast, sustainable and national law-compliant solutions for: • Recruitment, placement and management of outsourced local and expatriate staff • Obtaining visas for expatriates wishing to work in the DRC • Obtaining work permits and other required documents for expatriates • Procurement of Personal Protective Equipment (PPE) • All other services related to personnel management

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SOUTH AFRICA

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UGANDA

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Website: www.md-drc.com Email: info@md-drc.com

Christophe Mboso The veteran

ASSEMBLÉE NATIONALE RDC

His age, 78, the same as that of the US President, has earned him the nickname ‘Biden’. Elected the national assembly’s president on 3 February, Christophe Mboso N’kodia Pwanga has become a key Tshisekedi and Union Sacreé ally. As the longest-serving member of the assembly, he had already been heading the provisional bureau of the lower house since December 2020, following the dismissal of Jeanine Mabunda. The co-founder of the Parti Démocrate et Social Chrétien in 1990, Mboso is a member and executive secretary of the Alliance des Bâtisseurs pour un Congo Emergent. His management of the plenary sessions that brought down Mabunda and the Ilunkamba government established him as a key figure. His role – the country’s second most important in terms of protocol – is to get Tshisekedi’s electoral, security, economic and social reforms through the assembly. That will be essential for the head of state if he wants to run for a second term.

ALL RIGHTS RESERVED

DRC FOCUS /

Gaston-Thethe Kabwa Kabwe The adviser

In November 2020, when Tshisekedi was about to officialise his parting with Joseph Kabila, he chose Gaston-Thethe Kabwa Kabwe, a lawyer, to be part of a diplomatic mission to Rwanda to discuss security. Officially, Kabwa Kabwe is deputy chief of staff to François Beya, special adviser on security matters to the head of state, but for some time he has made a place for himself in Tshisekedi’s inner circle of advisers. He participates in the President’s strategy sessions and ensures his policies are executed.

A professor at the Université de Kinshasa and a lawyer at the bar of Kinshasa-La Gombe, Kabwa Kabwe holds a master’s in comparative law and a doctorate in private law from the Université de Paris-I (Panthéon-Sorbonne).

He was on the monitoring committee of the FCC-Cach agreement, which governed the two-year coalition linking Tshisekedi and Kabila, before playing his part in the creation of Tshisekedi’s new coalition, the Union Sacrée.

“His availability, his commitment, his calm temperament and his humility are the elements that work in his favour,” says a source in Tshisekedi’s entourage.

Samy Badibanga

Originally close to Etienne Tshisekedi, before his decision to defy a boycott and take his seat in parliament in 2011 caused a rift, Samy Badibanga Ntita served as prime minister, chosen from the opposition in Joseph Kabila’s government from November 2016 to April 2017. Fast-track to 2021, and Badibanga, as first vice-president of the Senate, was able to use his connections to rally parliamentarians to the cause of Félix Tshisekedi’s Union Sacrée coalition and overturn the power-sharing arrangement with Kabila.

Appointed by Tshisekedi junior to work with Bahati Lukwebo on building a parliamentary majority for the new coalition, Badibanga was instrumental in turning the Senate over to their side through persuasion and petitions. On 5 March, with Tshisekedi’s agreement, Badibanga resigned from his position as first vice-president of the Senate. He remains a close adviser to the President.

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THEAFRICAREPORT / N° 116

VINCENT FOURNIER/JA

The loyalist

ADVERTORIAL

DRC FOCUS /

Kabanda said it would take another couple of weeks to see a change on the ground.

The armed forces only sent half a Kinshasa-based commando battalion (about 200 men) to Ituri when the measure came into effect.

According to General Luboya Nkashama, a military governor: “If resources [are] allocated and measures to restructure the troops on the ground are launched, we should be able to expect an improvement in the overall situation within six months.”

THE EAST

State of insecurity The Tshisekedi government is mounting a military response to insecurity in Ituri and North Kivu, but will it be enough to sort out decades-old problems?

The declaration of a month-long state of siege in May is a sign that the Félix Tshisekedi government is taking more of a security-first approach to the fighting and instability in the Ituri and North Kivu provinces of the eastern DRC. After the first month delivered few improvements on the ground, the government prolonged the state of siege for another two weeks in June.

Analysts says it will take much longer to deal with rebel groups preying on local populations and the security forces that refuse to fight them or give them support.

The state of siege was a key measure announced by the newly formed government. Placing these two provinces under military administration, replacing governors and deputy governors with officials from the army or

police, and suspending civilian jurisdictions was supposed to help solve the security problem in these regions. The Kivu Security Tracker, a project developed by the Congo Research Group and Human Rights Watch, lists more than 120 armed groups there. The Allied Democratic Forces rebels alone are responsible for the deaths of more than 1,000 civilians since November 2019 in Beni.

Critics say that the government’s recent security strategy is not well thought out. It has struggled to organise the financial and human resources for the military push. In early June, defence minister Gilbert

1,000

civilians killed since November 2019 in Beni Territory alone

Soldiers are demotivated, say experts

58

Global strategy

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

BRENT STIRTON/GETTY IMAGES/AFP

By STANIS BUJAKERA TSHIAMALA

Analysts say that the state of siege will fail, like other military attempts before it, if it does not take into account all the factors that contribute to the conflict. “The military solution, via a state of siege, does not seem to us to be the appropriate response to the insecurity in these regions,” says Jean-Jacques Wondo, an analyst and expert on military issues. Politics, geopolitics, development and security all play a part.

Martin Ziakwau, a researcher on geopolitical dynamics in the eastern DRC, says: “There have already been so many military operations, some of which are still ongoing, and they have never had the expected results. The question today is therefore whether we have a global strategy and how we work to restore lasting peace.”

Troops’ passivity in combat and officials collaborating with rebel groups are among the challenges for the army. Juvénal Munubo Mubi, a member of the national assembly’s defence and security commission, advocates restructuring the chain of command of the units deployed in the two provinces and allocating significant logistical and financial resources to the military. It is also necessary to work on regaining the confidence of the population, he insists, “because no war can be won without that”.

ADVERTORIAL

DEVELOPING FIBRE OPTICS IN THE DRC Three questions to Eddy Ngarambe CEO of Saficables Facilitating the acceleration of digital coverage is one of the major challenges facing the Democratic Republic of Congo in the years to come.

Saficables, one of the main operators in the deployment of fibre optics in the country, thus plays a key role in terms of competitiveness, cohesion and development of the national territory. Roland Mandaka, the company’s Project General Manager, believes that this challenge will allow the DRC, which is currently ranked 145th in the world in terms of internet access, to bring very high speed internet access to the most remote areas.

What are the main challenges of bringing fibre optics to people with no access to the Internet in the DRC? Deployment in the DRC is slow because we have to deal with dilapidated infrastructure.

Introducing fibre optics involves very complex logistics, which becomes problematic when you have to transport hundreds of cables over poor or even non-existent roads. It is definitely a challenge, but we are making progress.

We have a clear objective of contributing to the gradual installation of facilities to bring broadband to the most remote populations that have no possibility of connecting to the Internet.

JAMG - PHOTOS DR

Is there really such a huge difference in internet access between cities and rural areas?

One cannot even begin to compare the two. Big cities like Kinshasa, Kananga and Muanda offer quality internet access through the roll-out of 3G and 4G technologies. However, beyond these areas, you can drive for thousands of kilometres without finding a single place to get online. Saficables’ mission is therefore really to be a game changer, even though the projects are expensive and involve complex financial arrangements.

Nevertheless, we can count on the government’s help, as it is very attentive to the issue of digital technology and aware that having stable and widespread Internet access is a key factor in DRC’s performance and competitiveness.

Has the pandemic had an impact on Saficables’ business?

Yes, in recent months our activities have been slowed down by the various restrictions. The logistics of deploying fibre optics are complex.

Because our business requires the work of hundreds of people, the health protocols in force – PCR tests, quarantine measures for those who have tested positive for the virus – have hampered our activity. However, there was no way around it, as our teams travel from city to city and from province to province. We couldn’t risk spreading the virus. The gradual lifting of restrictions, and in particular the curfew – which is still in force in the major cities – means that activity is almost back to normal. This is an encouraging sign and I am confident in our ability to roll-out the fibre optics necessary to getting the internet to places where it is not yet available. Saficables has been in business for over four years and our past actions have enabled NGOs, businesses, government entities and residents of major cities to benefit from a fast and efficient connection. Our ultimate goal is to erase the disparities and the significant development gap in rural areas of the DRC. Saficables aims to be a leader in the deployment of fibre optics throughout Central Africa, mainly in DRC, Angola, Congo Brazzaville and soon Gabon, Cameroon and Equatorial Guinea.

Saficables

84 avenue Equateur, Kinshasa Democratic Republic of Congo Tel: +243 81 36 92337 Email: roland.mandaka@saficables-rdc.com Email: arrachant@saficables-rdc.com

www.saficables-rdc.com

DRC FOCUS /

JOHN BOMPENGO FOR TAR

Equity Bank bought ProCredit in 2015

FINANCE

Kenya’s Equity Bank is optimistic about its DRC bet Having bought two Congolese banks, the DRC now represents a major focus of Kenya’s top bank

By DAVID WHITEHOUSE Equity Group expects its Banque Commerciale du Congo (BCDC) operation in the DRC to make a “significant” contribution to group profitability from the second half of this year, CEO James Mwangi tells The Africa Report. One-off costs for the business have so far prevented such a contribution, Mwangi said following the release of Equity Group’s first-quarter results.

In 2022, Mwangi expects that Equity BCDC will start making a profit contribution proportionate to the 27% share of Equity Group’s balance sheet for which it accounts, as synergies and economies of scale come into effect. “That growth won’t need additional investment,” Mwangi said. BCDC will be “leveraging the group’s existing infrastructure and digital assets”.

Equity Group has operated in the DRC since its purchase of ProCredit Bank in 2015. Equity then bought BCDC in August 2020. Equity BCDC, created by merging Equity Bank Congo with BCDC at the end of last year, is the second-largest subsidiary of Equity Group.

Political change has shaped Mwangi’s growing confidence in the DRC. He attributes this to President Félix Tshisekedi’s “commitment to reforms” and the fact that he is no longer governing in coalition with former president Joseph Kabila.

Equity Group already has a 28%

28% Equity Group’s market share in the DRC

market share in the DRC and will keep investing in the country as part of an organic growth strategy, Mwangi said.

He is also encouraged by the US granting preferential free-trade status to the DRC: “That gives us confidence. It’s not an internal arrangement that is being made.

The country has to keep on track with reforms.” The DRC regained beneficiary status under the African Growth and Opportunity Act as of 1 January. The status had been suspended due to human rights violations under Kabila.

Prudent provisions

Equity Group cut its group forecast for 2021 loan growth in its first-quarter statement. Loans are now predicted to increase by 20% to 25% this year, versus a previous forecast of 25% to 30%. The lower prediction is the result of repeated lockdowns in Nairobi in April and May, Mwangi says, noting that the capital city accounts for 60% of Kenya’s GDP. The bank also revised upwards its predicted return on equity for 2021 to between 25% and 30% from the previous forecast of 22% to 27%, and its return on assets to between 3.6% and 4.3%, versus 3.0%-4.0%. The cost of risk forecast was reduced to a range of 1.5% to 2.5% from 2.0%-3.0%.

Mwangi says these forecasts were due to “prudent” provisions made in 2020: “Provisioning made last year means that we don’t need additional risk coverage […]. There is unlikely to be any adverse quality deterioration” in the bank’s loan book.

According to Cytonn Investments in Nairobi, Equity Group restructured the largest absolute number of loans among Kenyan banks in 2020, at KSh171bn ($1.6bn). This accounted for 35.8% of the bank’s total loans, with only Diamond Trust among major Kenyan banks having a higher ratio, at 45%.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

61

KIBALI GOLD CONTINUES

ITS VIRTUOUS MOMENTUM

This successful gold mine in the north-east of the Democratic Republic of Congo (DRC) would not be able to celebrate its positive results unless the profits were shared with the Congolese community. This virtuous policy has had a significant positive impact on the communities around Kibali.

Central African Republic

KIBALI gold mine

N

Congo

BARRICK

Democratic Democratic Republic Republic of Congo Congo of

Angola Zambia 1000 km

Uganda

Tanzania

Through an active prevention strategy and worker mobilisation, the Barrick-operated Kibali Gold mine was able to maintain stable production of 191,612 ounces throughout the health crisis, thereby achieving first quarter production results in line with expectations.

Once again, it was the underground mine of this integrated open pit-underground operation that drove production, with continued improvements in throughput and recovery rates also contributing to Kibali’s performance. Other improvements made during the quarter, including an upgrade to the hoisting infrastructure, are expected to further boost its performance. Lastly, due to the high water levels in the rivers feeding the mine’s three hydroelectric plants, power generation costs were reasonable. The power supply grid was recently upgraded with the installation of a 9 MW battery standby unit, which will also reduce the need for emergency diesel-generated backup, reflecting the mine’s strategy to reduce its carbon footprint.

The processing plant was therefore able to maintain its strong performance, with higher throughput and recovery rates.

In addition, the cyanide destruction and recovery pilot plant demonstrates the po-

tential for improved cost and operational efficiency, as well as further reduction in environmental risk. This allows for continued sharing of the mine’s profits by associating the mine with a number of local development projects such as the completion of sections 3 and 4 of the Durba concrete road, the provision and opening of various water supply facilities for the villages of Nganya, Angarakali, Kanana and Renzi, the construction of the Doko 2 training centre and pig farm, and the ongoing training of Congolese managers and technicians.

Kibali Gold contributed to the national Covid response.

The mine’s strict compliance with prevention procedures largely protected it from the impact of the second wave of the pandemic. The company also stepped up its partnerships, for example, in agri-

PLANT PERFORMANCE Kibali gold production in Q1 (koz)1 80 60

65

40

68 59

20 0

Jan-21

Feb-21

Mar-21

ADVERTORIAL

Kibali Gold in the DRC Kibali Gold’s impact on various communities is considerable. Since 2010, the company has assisted in the construction of schools and clinics, and, in the first quarter of 2021, paid $35 million to local contractors. Ongoing civil engineering works and roads were completed by Congolese contractors (Iter Oriental Business – IOB,Top Engineering Services – TES, and Bravo Tozali Company – BTC). It set up a partnership with Congolese engineering company TES for the maintenance of the facilities. Furthermore, catering and accommodation services at Kibali are provided by Golden Camp Solutions (GCS), a Congolese company, with Kibali’s caterer buying 100% of its quality fresh food locally. Accommodation and meals are managed by the Tabitha Sisters Guest House.

Kibali Gold is committed to developing a range of community programmes such

INVESTMENT IN THE COUNTRY in millions of US dollars

Payments to contractors and suppliers US$2.09 billion

US$ 3.5 billion

Infrastructure and community support US$185 million Wages US$471 million

Royalties, taxes and licences US$759 million

Furthermore, Kibali is maintaining its support for the Garamba National Park in the Democratic Republic of Congo, one of the oldest in Africa and a UNESCO World Heritage Site. The national park support programme includes tracking collars for elephants, fuel for patrol planes and infrastructure improvements, resulting in zero documented cases of elephant poaching in the park in 2020. The next major undertaking is a plan to reintroduce white rhino and giant eland to the park.

What does the future hold?

Since the start of the Kibali Gold Mine development in 2010, the mine has contributed $3.5 billion to the DRC economy. Looking ahead, Kibali has secured additional open pit opportunities to balance its underground mine, continue to replace reserves and add flexibility to the operation to support its robust 10year plan. “We look forward to working closely with His Excellency the President of the Republic, Felix-Antoine Tshisekedi and his new coalition government to further strengthen our partnership with the DRC and to resolve certain outstanding issues relating to the Mining Code and repatriation of cash,” said Mark Bristow, President and Chief Executive Officer of Barrick Gold Corporation, which operates the Kibali gold mine.

4329, avenue Tombalbaye 3rd floor - Building Le Prestige Kinshasa/Gombe Democratic Republic of Congo www.barrick.com

JAMG - PHOTOS DR

business, with local procurement at Kibali, a donation of more than $2 million (mainly in equipment) to support central, provincial and local government (beyond the pledged $1.5 million), and the building of a treatment and isolation centre in Surur (Durba).

as the provision of school books and desks and vocational employment workshops for young people. For example, during the year 2020, Kibali Gold assisted 71 students with scholarships in various fields at several universities in the country. In 2021, the mine pursued its investment in community development, advancing the concreting of a 1.5 km section of the Durba road. The provision of additional drinking water facilities to surrounding villages was also scaled up. During the first quarter, the mine launched an innovative campaign to stimulate the Durba economy by issuing employees with local shopping vouchers.

The calm before the Covid storm. The Africa Report’s exclusive ranking of companies shows that the continent’s top firms were already experiencing problems due to shifts in commodity prices and currency values before the pandemic hit in 2020

By PIERRE-OLIVIER ROUAUD, CHRISTOPHE LE BEC and QUENTIN VELLUET 64

AFRICA

THE AFRICA REPORT’S

EXCLUSIVE

2021 RANKINGS

The effects of the Covid-19 crisis will hit African companies like a tsunami on their 2020 and 2021 earnings. Even before this exogenous shock, the continent’s champions were already struggling. This is what the latest edition of the The Africa Report’s Top 500 African companies shows.

This exclusive ranking is marked by a further decline (-1.05%) in the total turnover of companies, expressed in dollars. This follows a drop of 1.6% in the previous ranking. Taking investors on a

decade-long roller-coaster ride, the overall turnover of the Top 500 has grown by just 5.4% since 2009.

The peak was in 2012 ($736.8bn), and it could be years, perhaps a decade, before it is matched.

The new underperformance of the top 500 is all the more worrying given that the continent’s economies had been growing rather robustly.

According to the African Development Bank (AfDB), continental GDP grew by 3.3% in 2019, with 3% for sub-Saharan Africa alone. With the health crisis,

AFRICA

65

Africa, like the rest of the world, has been mired in an However, it includes two exits: Morocco’s OCP Group unprecedented recession with an estimated 2.1% drop (#19), affected by low fertiliser prices, and South Africa’s in GDP in 2020. According to the latest AfDB forecasts, Imperial Holdings. The latter split into two companies: Imperial Logistics (#39) and Motus (#18) on the autohowever, the continent’s GDP should recover 3.4% in 2021. motive distribution side.

Our ranking shows, once again, that two external factors play a key role in the evolution of our champions’ These outgoing companies are replaced in the top 15 by activity transcribed in US currency: commodity prices two South African groups: Anglo American Platinium and exchange-rate fluctuations. The rand continued to (#10), which benefited from the strength of platinum weaken. Its average price against the dollar declined by prices, and the refiner and distributor of fuels Engen Petroleum (#14), a subsidiary of Malaysia’s Petronas. about 9% in 2019. The Algerian dinar and Moroccan Sonatrach (#1) of Algeria remains the regular number dirham depreciated by about 2%, and the euro, to which one. Like Sonangol, its activity is affected by the price the CFA franc is pegged, by 5%. of hydrocarbons and was down by 4%.

Conversely, the Nigerian naira remained stable throughout the year and the annual average rate of the Egyptian pound appreciated by about 5%. As a sign of the times, South Africa bent but not broken our ranking includes seven more Egyptian companies By major regions, two areas saw their relative weight drop: Central Africa (from 2.23% to 2.13% of the total than last year, and the country’s weight in the cumulative Top 500) and Southern Africa (55.8% vs. 57.3%) – again turnover of the Top 500 rose from 7.3% to 8.5%, with the Suez Canal Authority (#16) and Orascom Construction an illustration of the currency devaluations in Angola and Industries (#45) leading the way, as they did last year. the persistent sluggishness of South Africa. The country led by President Cyril Ramaphosa recorded only 0.2% In monetary terms, a few countries experienced unusual situations in 2019, such as Angola, whose growth in 2019. Despite these difficulties, currency, the kwanza, collapsed by around South Africa remains by far the country with 50% against the dollar. This explains the the most companies ranked (156, eight fewer sharp drop – more than 40% – in Sonangol’s than the previous year). These companies still dollar-denominated turnover (#7, down five account for 51.4% of the total weight, but their companies represent places). cumulative turnover is slightly down (-1.8%). almost half the total Conversely, West Africa improves its relAnother major variation factor was the price turnover of the Top 500, of raw materials in 2019. For oil, the price of ative weight by more than a point (10.1% led, as always, by Sonatrach with $46.3bn.

West Texas Intermediate, the reference oil on against 9.06%) and returns to a level close to the New York Stock Exchange, fell by more the 2015 fiscal year after a continuous slide since then. The top three in the region are, as last year, than 10%, according to the annual average price published by the World Bank. Figures from the same source show MTN Nigeria (#44), Dangote Cement (#59) and Sonatel that cotton, palm oil and coffee fell slightly. Cocoa and Orange (#154). East Africa changed little, at 3.8% comrubber prices were up. So were precious metals, led by pared to last year’s 3.7%. Its largest company, Ethiopian gold. The price of iron ore jumped by a third: a good Airlines (#33) has shown outstanding resilience during the pandemic, which is likely to raise it even further on trend for the Société Nationale Industrielle et Minière next year’s rankings. in Mauritania, which moved up 79 places (#152).

In this economic context, the top 15 of our ranking In North Africa, Morocco, which traditionally comes in second in terms of the number of companies, lost seven represented almost half of the value of the turnover representatives (with 54 total companies on the list) and of the top 500 companies, and showed little change. also a percentage point, to drop to 7.7% of the total.

Finally, on the profitability side, out of 387 companies 2014 TOTAL TURNOVER Total turnover of the Top 500 companies for which we have complete data, the average net profit 690 (in billions of US$) over six years (including loss-making companies) is 5.1%. This is down sharply from 7.3% last year. This is mainly because we have now removed the financial sector from the ranking, which is instead included in our Top 200 Banks ranking.

In this top 500, the number of profitable companies 2017 for which we have data is 306. They have generated a 2018 2019 2015 total of $38.1bn in profits, including $24bn for the 100 637 627 620 610 most profitable companies, with a net profit of 23%. The 2016 largest profit in absolute terms this year was made by 569 Algeria’s Sonatrach, with $3.9bn. It is followed by the TAR RESEARCH

15

66

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

BREAKDOWN OF TURNOVER BY SECTOR Steel

$11.6bn

TOT AL $

Number of companies Electrical Equip.

6

$6.3bn

Communication

0 50

62 0.4 b

n

11

5 $8.7bn Agribusiness

$47.3bn

71

Wood Paper 6

Water, electricity 27 & gas

Mining

$59.7bn 53

$36.5bn

$21.9bn

8

Chemicals Utilities

Energy

$5.8bn 11

$113.2bn

Nigeria

678 157

237%

CEC Africa Investments (#195)

Zambia

712 934

170%

RBPlat (#246)

South Af.

532 824

112%

Remgro (#29) Tasiast Mauritanie (#247)

South Af.

4 051 564

88%

Mauritania

532 800

73%

COUNTRY

TURNOVER 2019 (THOUSAND US$)

TURNOVER CHANGE

$19.5bn

Telecoms

61

TOP CLIMBERS Krystal Digital (#199)

$71.7bn 56

12

COMPANY

Construction

$34.2bn

48

Transport

Retail

Diversified

$42.5bn 28

Automobile

$12.4bn

$35.7bn 32

$60.6bn 23

14 Financial services $7.2bn

11 Tourism

$2.2bn 8

4

Trinity Energy (#349)

South Sudan

332 597

-34%

Driefontein Mine (#429)

South Af.

234 916

-34%

Trident Steel (#412)

South Af.

251 125

-34%

ADI (#448)

Morocco

212 615

-38%

Angola

9 248 437

-41%

Sonangol (#7)

Technology

TOP FALLERS

$6.2bn

South African group Naspers (#32), which made significant capital gains on the sale of its shares in the media group MultiChoice and in the e-commerce business of the Indian company Flipkart.

Some sectors are booming while others are stagnating.

The past 12 months have been fruitful for Sébastien de Montessus and his teams at Endeavour Mining (not on our ranking as it is listed in Toronto). The French CEO, who joined the Canadian gold group in 2016 after heading up La Mancha – owned, like Endeavour, by the Egyptian tycoon Naguib Sawiris – completed the mergers and acquisitions of Semafo (#377) in April 2020, then Teranga Gold at the end of January 2021. These successive mergers are unprecedented in West Africa, a region on which Endeavour has set its sights: C$1bn (US$827m) for the absorption of Semafo, well established in Burkina Faso, and C$2.44bn (US$2bn) for Toronto-listed Teranga, the leading miner in Senegal.

In the telecoms sector, the move into financial services has been a game-changer, especially for Airtel Africa, which is represented in the Top 500 by its largest African operation, Airtel Nigeria (#106), as well as Airtel Uganda (#314), Airtel DRC (#381), Airtel Tanzania (#432) and Airtel Kenya (#447). Eleven years after Airtel’s arrival on the continent, the fourth largest pan-African operator in terms of customers – more than 118 million – has raised new capital and intends to return to the forefront. “I do not go two or three days without an investor soliciting me via consulting firms to discuss mobile money in Africa,” says an employee who requests anonymity.

A decade ago, the African subsidiary of Indian billionaire Sunil Mittal’s mobile operator Bharti Airtel was heavily indebted after its 2010 takeover of Zain (whose Sudanese operation, Zain Sudan is at #373) and was struggling to implement its low-cost operator strategy. Its financial difficulties, combined with tougher competition in the Indian market for its parent Striding among giants company, stopped it from investing as much as it would have liked on the continent, and Endeavour is now established among the Place in the global world’s 10 largest gold producers. With an the group even raised doubts among observers gold-mining pyramid estimated annual production of 1.5 million as to whether it would be able to maintain its shared by Endeavour and presence in all its African markets. ounces by 2021, it is neck and neck with South South Africa’s Harmony Gold Mining Company.

Africa’sHarmonyGoldMiningCompany(#72) Present in 14 African markets, where it for the title of 10th-largest gold miner in the achieved revenue of $401m (+35% at constant world. However, it is still far below the two behemoths: US exchange rates) in the fiscal year ending May 2021, Airtel company Newmont (6.2m ounces) and Canada’s Barrick Money is one of the main growth drivers for the operator.

At the end of March, a few weeks before MTN followed Gold (4.6m ounces). The latter remains a heavyweight on the continent, from where it drew around 2m ounces suit by hiving off its mobile-money operations, Airtel Africa, led by Raghunath Mandava – with a turnover of in 2020. Endeavour can also boast the third-lowest all-in cost of production among the majors, at around $850 per $3.9bn dollars for the financial year ending in May 2021 – announced the arrival of the US investor The Rise Fund ounce, well below Barrick’s $1,000 and Newmont’s $980.

10

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

67

TAR RESEARCH

Health

$14.9bn

REGIONAL WEIGHT BY TURNOVER Number of companies

Southern Africa 207 $346.1bn

North Africa 142 $174.9bn

amongst the shareholders of Airtel Money. Mastercard also participated in its funding round, contributing $100m.

This first share sale enabled the company to raise $300m in order to develop the distribution network for its payment solutions (via agents, kiosks or affiliated partners), microcredit, savings and money-transfer solutions. After long being accused of mobilising funds initially intended for the Indian market, Airtel Africa seems finally to be able to claim some financial emancipation.

28.19%

TOTAL

$620.4bn

55.78%

500 10.10%

First African CEO

2.13%

14

Methodology This year, we sent our questionnaire to more than 10,000 companies active on the continent. After cross-checks and verification, we established a ranking of approximately 1,200 companies, which includes responses from previous years.

The top-ranking 500 are published here. To allow for comparison, we apply the same rules to all our data: 1) All financial data must have a clearly defined source, generally

68

communicated to us by the companies themselves, and must refer to the year 2019 (in some cases 2019/2020); 2) If presented in the local currency, we converted the data into US dollar amounts according to the rate on 31 December 2019; 3) We include all companies that fall under the legal jurisdiction of at least one of the 54 countries in Africa, which is why a holding company and a subsidiary can

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

both feature in the list; and 4) Where we cannot obtain up-to-date figures, we use those of the previous year (marked with an asterisk and italics).

After two years of silence, a company is struck off the rankings.

The turnover change is based on the latest available data and not necessarily what was published in the previous ranking, as firms regularly update their financial statements.

TAR RESEARCH

3.80%

In addition to the liquidity provided by the increase in the value of mobile money, the group closed a loan West Africa 91 facility of up to $500m at the end of April. Investors $62.7bn East Africa 34 include Bank of America, HSBC, Citibank, JP Morgan $23.6bn and BNP. This sum is in addition to the funds recovered Central Africa 26 from the sale of 4,500 of its telecom towers to Helios $13.2bn Towers. On 23 March, Airtel confirmed the sale of its infrastructure in Madagascar and Malawi to the British to regain the confidence of the markets. Airtel Africa’s company for about $108m. The transaction should take share price has stagnated around £70 ($99) on the London Stock Exchange since the listing of 25% of the group in place between October and December, and will also include the sale of its towers in Gabon, Chad, and, “if June 2019. Airtel Africa is experiencing more success on the Lagos Stock Exchange, where its share price has all goes well” according to our source, in Tanzania. The operation is estimated at a total of $600m. increased by 250% in a year, reaching N837 ($2) on 5 May. In a few months, the group, which emAt the beginning of 2019, the possibility ploys more than 3,000 people, is due to have raised a total of $1.3bn. “This sum should that the operator would simplify its portfolio still haunted it, with rumours of the sale of be reinvested in the deployment of the 4G African countries served by network and the acceleration of services to Nigerian and Chadian operations, which Airtel Money, Airtel Africa’s businesses. A portion should be allocated were never confirmed. Two years later, it new subsidiary offering to debt payments,” says the source, without seems that Airtel is still convinced that it microcredit, saving and revealing specific figures. money transfers. can find growth.

Reducing the $3.5bn debt – 2.1 times its Watch this space for more tales of business gross operating profit – which has been stagnant for two opportunities seized and squandered, as next year’s Top years, will be one of the priorities of Nigerian Olusegun 500 rankings will begin to show which African companies Ogunsanya, the first African appointed to head Airtel adapted to the Covid-19 crisis and which ones buckled under the pressure.

Africa, who will take office on 1 October. His goal is

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1 - 50 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

1

1

0

Sonatrach

Petroleum

Algeria

46,296.7

3,939.4

-4%

2

4

2

Sasol

Chemicals

South Africa

14,478.3

432.0

15%

3

5

2

Eskom

Utilities

South Africa

14,186.2

-1,458.1

-1%

4

3

-1

Steinhoff International Holdings

Wood

South Africa

13,431.0

-2,065.3

3%

5

7

2

MTN Group

ICT/Telecoms

South Africa

10,771.8

872.6

16%

6

6

0

Shoprite Holdings

Retail

South Africa

10,696.1

360.9

6%

7

2

-5

Sonangol

Petroleum

Angola

9,248.4

94.0

-41%

8

9

1

Bidcorp Group

Food & drink

South Africa

9,192.3

346.3

13%

9

10

1

SPAR Group

Retail

South Africa

7,786.0

126.5

11%

10

22

12

Anglo American Platinum Corp.

Mining

South Africa

7,081.5

1,320.6

37%

11

12

1

Massmart Holdings

Retail

South Africa

6,674.1

-92.2

6%

12

13

1

Vodacom Group

ICT/Telecoms

South Africa

6,453.9

1,183.7

3%

13

14

1

Pick N Pay Stores Group

Retail

South Africa

6,349.7

85.0

6%

14

18

4

Engen Petroleum

Petroleum

South Africa

6,346.3

120.8

6%

15

11

-4

NLNG

Petroleum

Nigeria

6 314,9

ND

-8%

16

16

0

Suez Canal Authority

Ports

Egypt

5,800.0

ND

0%

17

17

0

Sappi

Wood

South Africa

5,746.0

211.0

-1%

18

-

-

19

15

-4

Motus

Auto industry

South Africa

5,669.0

134.8

6%

OCP Group

Mining

Morocco

5,574.7

310.8

-5%

20

20

21

21

0

The Bidvest Group

Diversified

South Africa

5,487.1

270.5

3%

0

The Bidvest Group South Africa*

Diversified

South Africa

5,252.2

ND

-7%

22 23

23

1

Transnet

Transport

South Africa

5,338.6

280.1

4%

35

12

Sibanye Gold

Mining

South Africa

5,141.6

30.8

47%

24

25

25

24

1

Woolworths Holdings

Retail

South Africa

5,091.9

-85.6

7%

-1

Vodacom South Africa

ICT/Telecoms

South Africa

4,949.5

ND

26

-

-

0%

Pepkor

Retail

South Africa

4,823.8

ND

27

41

2%

14

Kumba Iron Ore

Mining

South Africa

4,571.9

1,516.0

44%

28 29

27

-1

Datatec

ICT/Telecoms

South Africa

4,304.8

14.2

-1%

65

36

Remgro

Diversified

South Africa

4,051.6

551.3

88%

30

30

0

31

26

-5

Mediclinic Corporation

Healthcare

South Africa

4,043.7

-175.4

2%

Barloworld

Diversified

South Africa

4,042.0

176.2

-3%

32

38

6

Naspers

Media

South Africa

4,001.0

3,404.0

22%

33

29

-4

Ethiopian Airlines

Air transport

Ethiopia

4,000.0

189.0

0%

34

44

10

Naftal

Petroleum

Algeria

3,945.6

ND

2%

35

39

4

ONEE*

Utilities

Morocco

3,839.1

204.6

-3%

36

33

-3

Groupe Maroc Telecom

ICT/Telecoms

Morocco

3,763.4

280.9

0%

37

36

-1

Multichoice Africa

Media

South Africa

3,654.6

133.0

5%

38

34

-4

Al Mada (Ex S.N. d’Investissement)* Diversified

Morocco

3,544.9

486.2

-3% 5%

39

-

-

Imperial Logistics

Diversified

South Africa

3,536.1

254.8

40

31

-9

Anglogold Ashanti

Mining

South Africa

3,525.0

-7.0

6%

41

57

16

Impala Platinum Holdings

Mining

South Africa

3,458.5

-747.2

39%

42

40

-2

Sonelgaz*

Utilities

Algeria

3,264.3

ND

16%

43

43

0

MTN South Africa

ICT/Telecoms

South Africa

3,232.2

ND

5%

44

49

5

MTN Nigeria

ICT/Telecoms

Nigeria

3,205.1

553.8

13%

45

46

1

Orascom Construction Industries

Construction

Egypt

3,184.0

131.1

6%

46

45

-1

Transnet Freight Rail

Rail transport

South Africa

3,173.9

ND

5%

47

48

1

Telkom

ICT/Telecoms

South Africa

3,061.2

43.2

6%

48

54

6

Gold Fields

Mining

South Africa

2,967.1

344.8

15%

49

42

-7

ArcelorMittal South Africa

Metals

South Africa

2,941.0

-332.6

-6%

50

47

-3

Afriquia SMDC*

Petroleum

Morocco

2,941.0

92.3

5%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

70

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Petroleum distributor Afriquia SMDC (#50) has partnered with non-profit platform Mécano Al Maghrib to offer 3,000 garage mechanics training, leading to a qualification.

51 - 100 Rank 2019

Rank 2018

Diff.

51

62

11

52

61

9

53

52

54

53

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

Elsewedy Electric

Electr. equip.

Egypt

2,901.7

250.3

22%

Wilson Bayly Holmes-Ovcon

Construction

South Africa

2,888.5

39.0

19%

-1

Ezz Steel Company

Metals

Egypt

2,844.8

-385.5

4%

-1

Aspen Pharmacare Holdings

Pharmaceuticals

South Africa

2,748.6

327.9

12% 6%

55

55

0

Foschini

Retail

South Africa

2,736.4

173.8

56

59

3

Super Group

Transport

South Africa

2,692.7

115.4

9%

57

72

15

EgyptAir Holdings

Diversified

Egypt

2,660.8

57.7

33%

Safaricom

ICT/Telecoms

Kenya

2,447.8

611.2

7%

Dangote Cement

Construction

Nigeria

2,443.2

549.4

-1%

58

60

2

59

58

-1

60

69

9

Middle East Oil Refineries

Refining

Egypt

2,429.0

57.0

15%

61

66

5

Clicks Group

Retail

South Africa

2,373.7

121.1

11%

62

71

9

Al Ezz Dekheila Steel Company

Metals

Egypt

2,175.2

ND

8%

63

64

1

Maroc Telecom

ICT/Telecoms

Morocco

2,162.1

335.9

0%

64

74

10

Masscash

Retail

South Africa

2,153.3

ND

8%

65

73

8

Masswarehouse

Retail

South Africa

2,088.6

76.2

5%

66

75

9

Tiger Brands

Agribusiness

South Africa

2,079.0

276.7

6%

67

50

-17

Global Telecom Holding

ICT/Telecoms

Egypt

2,077.0

-115.0

-27%

68

88

20

EgyptAir Airlines

Air transport

Egypt

2,050.9

17.4

28%

69

118

49

Vodafone Egypt

ICT/Telecoms

Egypt

1,985.1

306.8

47%

70

79

9

RCL Foods

Food & drink

South Africa

1,977.4

-68.2

10%

71

96

25

STEG

Utilities

Tunisia

1,953.8

38.0

30%

72

103

31

Harmony Gold Mining Company

Mining

South Africa

1,914.0

-185.4

35%

73

77

4

Oando

Petroleum

Nigeria

1,861.7

78.9

36%

74

76

2

Sonatel

ICT/Telecoms

Senegal

1,858.4

336.5

-3%

75

81

6

Exxaro Resources

Mining

South Africa

1,829.6

716.1

4%

76

68

-8

Aveng

Diversified

South Africa

1,826.1

-119.5

-14%

77

86

9

Life Healthcare Group

Healthcare

South Africa

1,825.8

204.2

12%

78

89

11

Kap International Holdings

Diversified

South Africa

1,820.8

77.5

14%

79

87

8

AECI

Chemicals

South Africa

1,763.7

94.4

9%

80

82

2

Cevital*

Food & drink

Algeria

1,744.4

46.5

-14%

81

93

12

Cosider

Construction

Algeria

1,738.9

314.6

14%

82

97

15

Dis-Chem

Pharmaceuticals

South Africa

1,705.8

44.7

15%

83

85

2

STIR

Petroleum

Tunisia

1,683.3

ND

2%

84

-

-

Dangote Cement Nigeria

Construction

Nigeria

1,671.9

ND

-1%

85

83

-2

Royal Air Maroc

Air transport

Morocco

1,659.5

-13.5

-4%

86

80

-6

Blue Label Telecoms

ICT/Telecoms

South Africa

1,658.0

15.6

-7%

87

91

4

Mr Price Group

Retail

South Africa

1,637.9

192.3

5%

88

113

25

Telecom Egypt

ICT/Telecoms

Egypt

1,602.5

216.6

26%

89

78

-11

Distell Group

Food & drink

South Africa

1,591.0

28.1

-12%

90

105

15

Pioneer Foods Group

Food & drink

South Africa

1,584.0

65.1

14%

91

84

-7

Kansanshi Mining

Mining

Zambia

1,581.0

ND

-5%

92

101

9

Ghabbour Auto

Auto industry

Egypt

1,580.5

13.9

11%

93

100

7

Flour Mills of Nigeria

Food & drink

Nigeria

1,572.1

31.2

9%

94

117

23

The Arab Contractors

Construction

Egypt

1,544.7

ND

25%

Network Healthcare Holdings

Healthcare

South Africa

1,535.4

176.2

7%

Ethio Telecom

ICT/Telecoms

Ethiopia

1,479.7

ND

17% 14%

95

102

7

96

116

20

97

98

1

Petrojet*

Petroleum

Egypt

1,478.2

ND

98

92

-6

Vivo Energy Maroc

Petroleum

Morocco

1,476.0

ND

-5%

99

95

-4

Murray & Roberts Holdings

Construction

South Africa

1,434.3

24.6

-5%

100

106

6

Massdiscounters

Retail

South Africa

1,407.9

ND

3%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

71

Airtel Nigeria (#106), the country’s second-largest telecoms company by number of customers, experienced revenue growth of 12% to $422m for the quarter ended March 2021.

101 - 150 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Turnover change

Net profits

101

133

32

Hassan Allam Holding

Construction

Egypt

1,400.2

71.1

102

115

13

Katanga Mining Ltd

Mining

DRC

1,386.3

-923.3

55% 10%

103

107

4

Marikana (Ex-Lonmin)*

Mining

South Africa

1,345.0

62.0

15%

104

112

8

Mohammed Enterprises Tanzania

Retail

Tanzania

1,334.0

ND

4%

105

111

6

Omnia Holdings

Chemicals

South Africa

1,332.6

9.2

3%

106

129

23

Airtel Nigeria

ICT/Telecoms

Nigeria

1,288.8

316.4

17%

107

119

12

Truworths International

Retail

South Africa

1,286.8

175.3

6%

108

90

-18

SNH

Petroleum

Cameroon

1,275.4

754.3

23%

109

108

-1

Total Maroc

Petroleum

Morocco

1,268.7

61.8

-3%

110

104

-6

Tullow Ghana

Petroleum

Ghana

1,261.5

ND

-10%

111

114

3

Vivo Energy Kenya

Petroleum

Kenya

1,256.0

ND

-1%

112

127

15

Kenya Airways

Air transport

Kenya

1,254.9

-127.0

12%

113

148

35

Jumia Group

Retail

Nigeria

1,230.2

ND

30%

114

-

-

Afinitas

Financial serv.

Botswana

1,224.0

-741.0

72%

115

121

6

Ghana Oil Company

Petroleum

Ghana

1,215.2

18.5

3%

116

122

6

Allied Electronics Corporation

Electr. equip.

South Africa

1,188.6

47.8

9%

117

131

14

Sonabhy

Petroleum

Burkina Faso

1,186.7

71.6

10%

118

147

29

Gold Fields Ghana

Mining

Ghana

1,162.0

131.1

22%

119

161

42

Axian Group

Diversified

Madagascar

1,145.0

15.0

29%

120

110

-10

Comilog

Mining

Gabon

1,140.6

48.7

-12%

121

155

34

Compagnie Ivoirienne d‘Électricité

Utilities

Côte d’Ivoire

1,140.3

11.2

12%

122

150

28

Alviva Holdings

Electr. equip.

South Africa

1,132.4

27.8

20%

123

139

16

Mota-Engil Africa

Construction

South Africa

1,127.8

ND

9%

124

137

13

Kibali Gold Mine

Mining

DRC

1,123.0

194.0

8% 18%

125

152

27

Kenya Power and Lighting

Utilities

Kenya

1,099.6

2.6

126

134

8

Total Kenya

Petroleum

Kenya

1,094.2

24.8

4%

127

153

26

Rand Water

Utilities

South Africa

1,090.6

24.8

17%

128

149

21

Label' Vie

Retail

Morocco

1,071.3

32.8

13%

129

141

12

Hosken Consolidated Investments

Diversified

South Africa

1,061.4

-521.0

7%

130

135

5

IBL Group

Diversified

Mauritius

1,042.7

37.1

0%

131

109

-22

Nampak

Wood & paper

South Africa

1,041.4

107.6

-6% -3%

132

132

0

Marjane Holding

Retail

Morocco

1,036.4

44.1

133

146

13

Massbuild

Construction

South Africa

1,011.3

ND

6%

134

167

33

Société des Mines de Loulo

Mining

Mali

1,007.0

158.0

19%

135

165

30

MTN Ghana

ICT/Telecoms

Ghana

982.9

ND

16%

136

156

20

Transnet Port Terminals

Ports

South Africa

982.1

ND

8%

137

142

5

Société Africaine de Raffinage*

Refining

Senegal

979.0

-2.5

3%

138

170

32

PetroSA

Petroleum

South Africa

973.7

-396.8

16% 4%

139

154

15

Anglovaal Industries

Food & drink

South Africa

967.2

176.0

140

151

11

Holmarcom Group

Diversified

Morocco

962.3

ND

3%

141

158

17

PSG Group

Financial serv.

South Africa

960.3

182.3

6%

142

159

17

Astral Foods

Agribusiness

South Africa

959.1

99.3

7%

143

160

17

Taqa Morocco

Utilities

Morocco

939.7

108.6

6%

144

136

-8

Adcorp Holdings

Services

South Africa

928.7

-42.9

-8%

145

195

50

Qalaa Holdings

Financial serv.

Egypt

928.3

-94.9

26%

146

186

40

Etisalat Misr

ICT/Telecoms

Egypt

915.3

-

23%

147

143

-4

Renault Commerce Maroc

Auto industry

Morocco

910.9

ND

-6%

148

140

-8

Choppies Enterprises

Retail

Botswana

893.1

-39.8

-9%

149

188

39

Orange Egypt

ICT/Telecoms

Egypt

891.6

ND

6%

150

145

-5

Nigerian Breweries

Food & drink

Nigeria

885.0

44.1

0%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

72

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

‘Communication prices have dropped by at least 80% between 2016 and now. No other sector has had such a price drop.’

SEKOU DRAMÉ, CEO of Sonatel Orange (#154)

151 - 200 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

151

163

12

Pétrole du Maghreb

Petroleum

Morocco

884.7

ND

1%

152

231

79

SNIM

Mining

Mauritania

880.0

288.0

51% 20%

153

196

43

PGI Holding – Amen Group

Diversified

Tunisia

879.4

87.3

154

169

15

Sonatel Orange

ICT/Telecoms

Senegal

876.4

ND

4%

155

-

-

The Industrial Development Corp.

Institutions

South Africa

870.5

-269.5

-6%

156

164

8

Transnet National Ports Authority

Ports

South Africa

865.7

ND

0%

157

190

33

Eastern Company

Agribusiness

Egypt

864.6

232.3

16%

158

176

18

Cosumar

Agribusiness

Morocco

846.3

95.2

6%

159

198

39

Transnet Rail Engineering

Rail transport

South Africa

844.8

ND

16%

160

173

13

Algérie Télécom

ICT/Telecoms

Algeria

841.0

106.8

3%

161

126

-35

EOH Holdings

ICT/Telecoms

South Africa

838.6

-7.2

0%

162

207

45

Johannesburg Water Company

Utilities

South Africa

833.4

124.7

19%

163

217

54

Volta River Authority

Utilities

Ghana

826.2

ND

25%

164

202

38

Poulina Group Holding

Diversified

Tunisia

824.4

46.6

14%

165

171

6

Orange Côte d’Ivoire

ICT/Telecoms

Côte d’Ivoire

822.5

93.6

-1%

166

185

19

Growthpoint Properties

Construction

South Africa

809.9

523.9

7%

167

172

5

Lafargeholcim Maroc

Construction

Morocco

809.6

175.3

-2%

Total Gabon

Petroleum

Gabon

807.8

50.4

-11%

East African Breweries Group

Food & drink

Kenya

807.3

112.6

13%

Groupe SIFCA

Agribusiness

Côte d’Ivoire

805.4

-33.6

-16% 19%

168

157

-11

169

204

35

170

174

4

171

212

41

AGIL

Petroleum

Tunisia

801.3

ND

172

168

-4

Total Nigeria

Petroleum

Nigeria

800.6

6.2

-5%

173

205

32

Metair Investments

Auto industry

South Africa

799.2

46.8

12%

CMH Group

Auto industry

South Africa

793.4

13.5

3%

Mpact

Wood & paper

South Africa

787.7

-51.3

7%

174

183

9

175

194

19

176

182

6

Al Ezz Rolling Mills

Metals

Egypt

783.3

ND

5%

177

197

20

Nestlé Nigeria

Food & drink

Nigeria

778.3

125.2

7%

178

192

14

Total Côte d’Ivoire

Petroleum

Côte d’Ivoire

774.9

17.8

5%

179

179

0

Djezzy (Ex-Optimum Telecom Algeria) ICT/Telecoms

Algeria

773.3

ND

-3%

180

187

7

Lyonnaise des Eaux de Casablanca

Utilities

Morocco

769.0

17.4

2%

181

216

35

Total Sénégal

Petroleum

Senegal

766.5

10.0

15%

182

181

-1

Alexandria Minerals Oils Co.

Petroleum

Egypt

765.7

17.4

-12%

183

199

16

Reunert

ICT/Telecoms

South Africa

762.0

57.2

5%

184

177

-7

Hulamin

Metals

South Africa

761.6

-85.7

-5%

185

251

66

Northam Platinum

Mining

South Africa

757.4

4.3

45%

186

224

38

RMB Holdings

Financial serv.

South Africa

740.9

709.6

21%

187

191

4

Sanam Agro*

Food & drink

Morocco

741.9

ND

-2%

188

225

37

Talaat Moustafa Group

Construction

Egypt

730.8

113.6

20% 37%

189

247

58

Julius Berger Nigeria

Construction

Nigeria

730.0

24.0

190

203

13

Pretoria Portland Cement Co.

Construction

South Africa

728.3

-169.8

0%

191

193

2

Ooredoo Algeria

ICT/Telecoms

Algeria

721.0

ND

-2%

192

215

23

Tarkwa Mines

Mining

Ghana

720.4

101.3

8%

193

206

13

Cashbuild

Construction

South Africa

717.7

19.4

-4%

194

200

6

Invicta Holdings

Auto industry

South Africa

713.9

ND

-1%

195

-

-

CEC Africa Investments

Financial serv.

Zambia

712.9

329.0

170%

196

144

-52

Algérie Télécom Mobilis

ICT/Telecoms

Algeria

688.0

112.3

-29%

197

213

16

Orange Mali

ICT/Telecoms

Mali

686.3

ND

2%

198

219

21

African Rainbow Minerals

Mining

South Africa

682.5

274.1

6%

199

493

294

Krystal Digital Network Solutions

ICT/Telecoms

Nigeria

678.2

21.3

237%

200

218

18

Orange Maroc

ICT/Telecoms

Morocco

674.3

ND

2%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

73

In May, the Botswanan retail group Sefalana Holding Co. (#242) acquired a 40% stake in Seasons Group, an Australian supermarket chain, for $6.1m.

201 - 250 Rank 2019

Rank 2018

Diff.

201

214

13

202

120

-82

203

223

204

233

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

Liquid Telecom*

ICT/Telecoms

Mauritius

668.9

-116.1

-2%

Tongaat-Hulett Group

Food & drink

South Africa

664.8

ND

10%

20

Société Nationale d’Électricité

Utilities

Senegal

657.9

ND

7%

29

Afriquia Gaz

Petroleum serv.

Morocco

654.2

72.1

13%

205

-

-

Centamin

Mining

Egypt

652.3

172.9

8%

206

229

23

East African Breweries Kenya

Food & drink

Kenya

648.9

ND

10%

207

220

13

Ciel Group

Diversified

Mauritius

642.9

-31.6

0%

208

281

73

Electricidade de Moçambique

Utilities

Mozambique

637.1

-34.4

27%

209

230

21

Zimplats Holdings

Mining

Zimbabwe

631.0

144.9

8%

210

232

22

Oriental Weavers Company

Textile

Egypt

630.6

ND

9%

211

209

-2

Eterna Oil & Gas

Chemicals

Nigeria

628.2

-0.4

-9%

212

228

16

Raubex

Construction

South Africa

621.2

21.4

5%

213

222

9

Tanzania Electric Supply Co.*

Utilities

Tanzania

617.5

-9.5

-1%

214

237

23

Redefine Properties

Construction

South Africa

614.3

248.5

9%

215

211

-4

Stefanutti Stocks Holdings

Construction

South Africa

610.6

-76.2

-11%

216

273

57

SIIC Egypt

Agribusiness

Egypt

609.6

21.6

-6%

217

226

9

Vivo Energy Côte d’Ivoire

Petroleum

Cÿÿôte d’Ivoire

605.8

9.4

0%

218

208

-10

Mondi Group South Africa

Wood & paper

South Africa

603.7

ND

-13%

219

283

64

Kaap Agri Ltd

Agribusiness

South Africa

601.1

20.0

33%

220

227

7

SA des Brasseries du Cameroun

Food & drink

Cameroon

587.2

23.6

-2%

221

221

0

Seplat Petroleum Development Co.

Petroleum

Nigeria

586.8

221.9

-6%

222

166

-56

Lafarge Africa

Construction

Nigeria

583.6

49.0

-31%

223

272

49

Pioneers Holding

Financial serv.

Egypt

582.6

84.2

23%

224

321

97

IHS Towers Group

ICT/Telecoms

Mauritius

580.6

-64.3

48%

225

236

11

Essakane Gold Mine

Mining

Burkina Faso

579.2

ND

3%

226

244

18

Assore

Mining

South Africa

579.0

424.2

7%

227

234

7

Clover Holdings*

Food & drink

South Africa

575.5

-2.6

-29%

228

260

32

Zalar Holding

Agribusiness

Morocco

574.9

-7.7

15%

229

239

10

Nigerian Bottling Co.

Food & drink

Nigeria

573.6

ND

3%

230

-

-

Vivo Energy Ghana

Petroleum

Ghana

571.0

ND

-5%

231

235

4

Air Mauritius*

Air transport

Mauritius

570.8

-24.8

-7%

232

252

20

Société Tunisienne de l’Air

Air transport

Tunisia

569.4

ND

9%

233

248

15

Biopharm

Pharmaceuticals

Algeria

567.1

63.6

7%

234

241

7

ETAP

Petroleum

Tunisia

560.2

53.5

2%

235

-

-

Egyptian Pharmaceuticals Trading

Pharmaceuticals

Egypt

559.7

6.4

34%

236

253

17

Bell Equipment

Auto industry

South Africa

556.4

4.3

7%

237

262

25

Famous Brands

Tourism

South Africa

553.3

30.4

3%

238

254

16

Eneo Cameroon

Utilities

Cameroon

549.0

-40.9

6%

Al Ezz Flat Steel*

Metals

Egypt

546.0

ND

44%

Raya Holding

Electr. equip.

Egypt

545.6

-5.3

24%

Oceana Group

Agribusiness

South Africa

543.9

46.1

2%

18.4

12%

239

242

3

240

293

53

241

246

5

242

267

25

Sefalana Holding Co.

Food & drink

Botswana

541.8

243

240

-3

CMDT

Agribusiness

Mali

535.3

4.8

-3%

244

305

61

AFC

Chemicals

Egypt

534.2

196.5

27%

245

249

4

Zeder Investments

Agribusiness

South Africa

532.8

42.6

1%

246

425

179

Royal Bafokeng Platinum

Mining

South Africa

532.8

4.6

112%

247

375

128

Tasiast Mauritanie

Mining

Mauritania

532.8

ND

73%

248

286

38

11 Plc (Ex Mobil Oil Nigeria)

Petroleum

Nigeria

525.2

24.3

16%

249

288

39

Pharmacie Centrale de Tunisie

Pharmaceuticals

Tunisia

524.7

ND

18%

250

276

26

Egypt Kuwait Holding Co.

Diversified

Egypt

523.9

151.1

13%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

74

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Société de Fabrication des Boissons de Tunisie (SFBT, #296) recorded a 9.71% decrease in turnover for the first quarter of 2021 compared to the same period in 2020.

251 - 300 Rank 2019

Rank 2018

Diff.

251

325

74

252

-

-

253

274

21

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

Kenya Ports Authority

Ports

Kenya

520.9

67.2

Hyproc Shipping Co.

Petroleum

Algeria

518.6

ND

18% 2%

ONCF

Rail transport

Morocco

513.7

-196.7

10% -4%

254

256

2

CDG Développement*

Services

Morocco

512.3

ND

255

270

15

Vodacom DRC

ICT/Telecoms

DRC

511.5

ND

8%

256

284

28

Adcock Ingram Holdings

Pharmaceuticals

South Africa

509.6

49.5

13%

257

258

1

Group Five Holdings

Construction

South Africa

508.7

-94.5

-37%

258

285

27

Comair

Air transport

South Africa

506.8

63.8

12%

259

264

5

Airports Co. of South Africa

Air transport

South Africa

506.6

68.0

3%

260

271

11

Tradex

Petroleum

Cameroon

498.3

12.2

5%

261

308

47

Italtile

Construction

South Africa

496.1

89.1

18%

262

245

-17

Ascendis Health

Pharmaceuticals

South Africa

495.2

-76.3

22%

263

263

0

MTN Côte d’Ivoire

ICT/Telecoms

Cÿÿôte d’Ivoire

491.9

ND

-1%

264

238

-26

Kloof Gold Mining Co.

Mining

South Africa

484.2

-106.8

-14%

265

331

66

Ardova (Ex-Forte Oil)

Petroleum

Nigeria

483.7

10.7

31%

266

-

-

BUA Cement

Construction

Nigeria

480.9

166.1

47%

267

360

93

TAQA Arabia

Petroleum

Egypt

480.7

24.4

47%

268

315

47

Umeme

Utilities

Uganda

479.7

37.6

19%

269

292

23

Hudaco Industries

Auto industry

South Africa

476.8

33.5

8%

270

329

59

MTN Uganda

ICT/Telecoms

Uganda

476.5

ND

27%

271

318

47

Juhayna Food Industries

Food & drink

Egypt

475.2

20.5

20%

272

250

-22

Holding Al Omrane

Construction

Morocco

471.1

41.0

-10%

273

261

-12

Centrale Danone

Food & drink

Morocco

471.0

-56.3

-1%

274

280

6

Groupe Managem

Mining

Morocco

469.3

-44.0

3%

275

279

4

Namibian Power Corp.

Utilities

Namibia

467.9

53.4

2%

276

304

28

North Mara Gold Mine

Mining

Tanzania

462.0

147.0

9%

Eclosia Group*

Food & drink

Mauritius

461.4

23.3

2%

Total Petroleum Ghana

Petroleum

Ghana

459.9

12.0

-6% 8%

277

277

0

278

265

-13

279

302

23

Lewis Group

Retail

South Africa

459.0

13.0

280

278

-2

Aenergy

Petroleum

Angola

456.8

28.9

4%

281

259

-22

Auto Hall

Auto industry

Morocco

456.0

16.3

-9% 21%

282

282

0

Maurel & Prom Gabon

Petroleum

Gabon

454.0

ND

283

-

-

Industries Chimiques du Sénégal

Mining

Senegal

450.0

ND

ND

284

295

11

Prosuma Group

Retail

Cÿÿôte d’Ivoire

453.2

1.7

3%

Kenya Electricity Generating Co.

Utilities

285

394

109

286

296

10

Kenya

449.5

77.1

2%

Caxton & CTP. Publishers & Printers Media

South Africa

449.5

25.3

287

-

3%

-

Petroci

Petroleum

Cÿÿôte d’Ivoire

449.4

42.8

288

294

8%

6

Vodacom Tanzania

ICT/Telecoms

Tanzania

444.0

19.7

1%

289

313

24

290

275

-15

Dangote Sugar Refinery

Agribusiness

Nigeria

441.4

61.3

7%

Tanzania Breweries

Food & drink

Tanzania

441.2

64.6

-5%

291

301

292

316

10

Office National des Aéroports

Air transport

Morocco

437.1

58.4

4%

24

Ooredoo Tunisia

ICT/Telecoms

Tunisia

436.2

ND

24%

293

298

5

SGTM*

Construction

Morocco

435.0

ND

36%

294

299

5

Compagnie des Bauxites de Guinée*

Mining

Guinea

432.9

48.6

5%

295

309

14

African Oxygen

Chemicals

South Africa

432.8

45.1

3%

296

327

31

SFBT

Food & drink

Tunisia

429.4

78.5

14%

297

335

38

Espitalier Noël Group

Diversified

Mauritius

426.6

36.1

17%

298

310

12

Sofitex*

Agribusiness

Burkina Faso

417.6

ND

ND

299

320

21

Mustek

ICT/Telecoms

South Africa

415.8

7.6

6%

300

307

7

Ciments du Maroc

Construction

Morocco

412.0

111.4

-2%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

75

‘We are seeing lower than anticipated market conditions and so we evaluate all our operations on a monthly basis.’

ZANELE MATLALA Merafe Resources (#322)

301 - 350 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

301

306

5

Copperbelt Energy Corp.

Utilities

Zambia

408.3

12.2

-3%

302

332

30

Transnet Pipelines

Petroleum

South Africa

407.7

ND

12%

303

383

80

Orange Guinée

ICT/Telecoms

Guinea

406.7

ND

10%

304

311

7

Suez Cement Co.

Construction

Egypt

402.1

-73.3

-3%

305

290

-15

South African Broadcasting Corp.

Media

South Africa

402.0

-36.4

-9%

306

323

17

Tunisie Télécom

ICT/Telecoms

Tunisia

399.1

ND

11%

307

416

109

Arise (Ex-Gabon SEZ)

Transport

Gabon

398.9

99.4

51%

308

351

43

Vodacom Mozambique

ICT/Telecoms

Mozambique

396.3

ND

17%

309

319

10

Société Africaine de Cacao*

Agribusiness

Côte d’Ivoire

395.5

2.5

-20%

310

297

-13

Lesieur Cristal

Food & drink

Morocco

393.0

16.5

-10%

311

300

-11

Waco International

Construction

South Africa

392.2

ND

-8%

312

268

-44

Salam Gaz

Petroleum serv.

Morocco

391.6

ND

-19%

313

339

26

Aveng Steel

Metals

South Africa

390.0

ND

8%

314

354

40

Airtel Uganda

ICT/Telecoms

Uganda

389.8

82.3

15%

315

312

-3

Palm Hills Development Co.

Construction

Egypt

387.3

56.4

-6%

316

343

27

Rhodes Food Group Holdings

Food & drink

South Africa

385.0

15.3

11%

317

344

27

Solibra

Food & drink

Cÿÿôte d’Ivoire

384.8

22.4

9%

318

-

-

Hidroelectrica de Cahora Bassa

Utilities

Mozambique

384.1

97.7

7%

319

389

70

Société des Mines de Tongon

Mining

Cÿÿôte d’Ivoire

384.0

-29.0

32%

320

349

29

MTN Cameroon

ICT/Telecoms

Cameroon

383.3

ND

12%

321

355

34

Conoil

Petroleum

Nigeria

382.9

4.9

14%

322

324

2

Merafe Resources

Mining

South Africa

382.6

-96.9

-1%

323

340

17

Tigo Tanzania

ICT/Telecoms

Tanzania

382.0

ND

-4%

324

366

42

Société Magasin Général

Retail

Tunisia

377.3

-5.0

13%

South African Post Office*

Services

South Africa

376.4

-76.1

3%

Société Gabonaise de Raffinage

Refining

Gabon

375.0

ND

-11%

325

328

3

326

314

-12

327

338

11

NSIA Participations

Diversified

Cÿÿôte d’Ivoire

374.5

ND

3%

328

341

13

Maghrébail

Financial serv.

Morocco

373.9

11.0

5%

329

317

-12

Société Nationale de Sidérurgie

Metals

Morocco

373.3

-4.3

-7%

330

334

4

ASECNA

Air transport

Senegal

366.6

64.9

1%

331

376

45

ADvTECH Group

Services

South Africa

363.3

33.3

20%

332

357

25

International Breweries

Food & drink

Nigeria

362.6

-76.1

10%

333

330

-3

C. N. de Prévoyance Sociale

Services

Cameroon

362.6

126.2

-2%

334

322

-12

Guinness Nigeria

Food & drink

Nigeria

360.3

15.0

-8%

335

359

24

Orange Burkina Faso

ICT/Telecoms

Burkina Faso

360.0

ND

26%

336

336

0

Bamburi Cement

Construction

Kenya

359.9

3.5

-1%

337

303

-34

Groupe Addoha Douja Promotion

Construction

Morocco

358.6

41.2

-16%

338

-

-

Perseus Mining Ghana

Mining

Ghana

355.7

5.3

34%

339

385

46

Orange DRC

ICT/Telecoms

DRC

354.0

ND

14%

340

356

16

Bissa-Bouly Gold

Mining

Burkina Faso

352.7

ND

7%

341

352

11

Orange Cameroon

ICT/Telecoms

Cameroon

351.0

ND

3%

342

476

134

SODIC

Construction

Egypt

346.6

44.8

58%

343

400

57

Délice Holding

Agribusiness

Tunisia

344.6

15.4

23%

344

345

1

SEEG

Utilities

Gabon

344.1

ND

-1%

345

365

20

IPS West Africa

Diversified

Cÿÿôte d’Ivoire

343.8

24.3

7%

346

361

15

Autoroutes du Maroc

Construction

Morocco

339.8

10.4

4%

347

353

6

Sania Compagnie*

Agribusiness

Côte d’Ivoire

339.6

-1.1

-8%

Sonabel

Utilities

Burkina Faso

334.9

3.9

5%

Trinity Energy

Petroleum

South Sudan

332.6

2.1

-34%

Aveng Grinaker-LTA

Construction

South Africa

328.4

ND

-28%

348

368

20

349

-

-

350

424

74

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

76

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

In July 2020, Tsogo Sun Hotels, part of Tsogo Sun Holdings (#356) sold its stake in United Resorts and Hotels, which has assets in the Seychelles, for R465m ($28m).

351 - 400 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

351

348

-3

Entreprise Nationale de Forage

Petroleum

Algeria

325.4

ND

352

377

25

ENGTP

Petroleum

Algeria

324.3

31.2

7%

353

373

20

Ciel Textile

Textile

Mauritius

322.7

ND

4%

354

402

48

One Tech Holding

Electrical equip.

Tunisia

321.3

8.1

15%

355

420

65

MTN Benin

ICT/Telecoms

Benin

319.9

ND

25%

356

128

-228

Tsogo Sun Holdings

Tourism

South Africa

318.3

-87.1

5%

357

369

12

ENL Land Ltd*

Agribusiness

Mauritius

317.8

39.0

9%

358

370

12

Energie du Mali*

Utilities

Mali

317.2

-114.9

3% -10%

359

-

-

360

445

85

361

471

110

-5%

Houndé Gold Corp.

Mining

Burkina Faso

316.1

ND

Brimstone Investment Corp.

Financial serv.

South Africa

315.8

5.4

35%

South Deep Gold Mine

Mining

South Africa

314.8

7.2

50%

362

396

34

Quantum Foods Holdings

Food & drink

South Africa

314.2

13.5

10%

363

333

-30

Vivo Energy Mauritius

Petroleum

Mauritius

314.1

10.3

-14%

364

464

100

Tullow Gabon

Petroleum

Gabon

312.9

ND

46%

365

387

22

Santova Logistics

Transport

South Africa

308.8

4.6

6%

366

364

-2

Sidi Kerir Petrochemicals Co.

Petroleum

Egypt

308.7

30.3

-4%

367

358

-9

368

374

6

369

410

370

466

371

372

1

372

384

12

373

371

-2

374

347

-27

375

378

3

376

391

15

377

382

5

378

388

10

379

362

-17

380

379

381

406

382

-

383 384

Maghreb Steel

Metals

Morocco

307.9

-30.2

-6%

Dangote Flour Mills*

Agribusiness

Nigeria

307.8

-3.2

-11%

41

Kenya Pipeline Co.

Petroleum

Kenya

307.7

20.0

14%

96

FEICOM

Services

Cameroon

305.3

ND

11%

Ceca-Gadis

Retail

Gabon

304.4

-8.2

-4%

Delta Holding

Diversified

Morocco

304.3

22.7

2%

Zain Sudan

ICT/Telecoms

Sudan

304.0

ND

-4%

Puma Energy Zambia

Petroleum

Zambia

302.1

7.6

-13%

Ciments de l’Atlas

Construction

Morocco

301.0

61.2

4%

Marsa Maroc

Ports

Morocco

299.8

67.1

4%

SEMAFO Burkina Faso*

Mining

Burkina Faso

296.7

-6.9

15%

Press Corporation

Diversified

Malawi

294.9

33.2

1%

Moolmans (Ex-Aveng Mining)

Mining

South Africa

294.7

-15.4

-10%

-1

Novus Holding

Wood

South Africa

292.5

-24.5

-2%

25

Airtel DRC

ICT/Telecoms

DRC

291.2

49.3

6%

-

Orascom Hotels and Development

Tourism

Egypt

290.0

43.9

55%

390

7

Leal Group*

Diversified

Mauritius

289.5

7.1

3%

452

68

Abosso Goldfieds – Damang Mine

Mining

Ghana

288.3

25.5

26%

385

413

28

BGI Ethiopia

Food & drink

Ethiopia

286.5

ND

7%

386

398

12

Alexander Forbes

Financial serv.

South Africa

286.0

3.3

2% 58%

387

-

-

Seaharvest Corp.

Agribusiness

South Africa

282.1

28.1

388

393

5

Chirano Gold Mine

Mining

Ghana

281.6

ND

-2%

389

481

92

Mauritius Telecom

ICT/Telecoms

Mauritius

278.7

17.1

36%

390

411

21

Groupe des Boissons du Maroc

Food & drink

Morocco

275.1

38.9

2%

391

421

30

Cairo Poultry

Food & drink

Egypt

274.7

7.3

8%

392

415

23

Rogers & Co

Diversified

Mauritius

273.5

29.5

3%

393

439

46

Grindrod

Sea transport

South Africa

272.7

21.3

15%

394

450

56

Engen Botswana

Petroleum

Botswana

271.5

12.0

17%

395

407

12

Wescoal

Mining

South Africa

271.0

-9.7

-1%

396

-

-

Resilient Property Income Fund

Construction

South Africa

270.7

ND

49%

397

367

-30

Beatrix Mine

Mining

South Africa

270.2

-60.7

-15%

398

434

36

Sodecoton

Agribusiness

Cameroon

268.5

ND

19%

399

430

31

Nestlé Côte d’Ivoire

Food & drink

Cÿÿôte d’Ivoire

267.3

2.9

7%

400

-

-

S. N. de Génie Civil et Bâtiments

Construction

Algeria

265.6

ND

5%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

77

Moroccan lender Eqdom (#420) saw net credit production fall by 24% in 2020 compared to 2019, to stand at Dh1.99bn ($225m).

401 - 450 Rank 2019

Rank 2018

Diff.

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

401

403

2

Princes Tuna

Agribusiness

Mauritius

265.1

ND

ND

402

408

6

Golden Star Resources

Mining

Ghana

264.7

-78.0

-3%

403

477

74

Groupe Sipromad

Diversified

Madagascar

264.4

ND

ND

404

438

34

Société Minière de Dinguiraye

Mining

Guinea

263.5

ND

10%

405

404

-1

Onatel

ICT/Telecoms

Burkina Faso

263.4

51.4

-5%

406

-

-

ITY Gold Mine

Mining

Cÿÿôte d’Ivoire

262.0

ND

ND

407

386

-21

Cervejas de Moçambique

Food & drink

Mozambique

260.5

16.3

-11%

408

392

-16

Beachcomber Res. & Hot. (ex NMH) Tourism

Mauritius

257.3

4.2

-5%

409

363

-46

Sudatel Telecom Group

ICT/Telecoms

Sudan

256.5

8.0

-21%

410

401

-9

Zambeef

Food & drink

Zambia

254.5

-1.4

-9%

411

494

83

Umgeni Water-Amanzi

Utilities

South Africa

251.7

100.5

25%

412

-

-

Trident Steel

Metals

South Africa

251.1

ND

-34%

413

470

57

Edita Food Industries

Agribusiness

Egypt

250.5

22.5

19%

414

428

14

TGCC*

Construction

Morocco

249.5

23.6

-3%

415

469

54

Tanger Med Port Authority

Ports

Morocco

246.2

77.1

17%

416

451

35

RADEEMA

Utilities

Morocco

246.2

21.1

7%

417

454

37

SAPH

Agribusiness

Cÿÿôte d’Ivoire

245.8

5.8

9%

418

124

-294

Sun International

Tourism

South Africa

245.7

75.0

6%

419

453

34

Groupe Intelcia

Services

Morocco

244.2

ND

7%

420

447

27

Eqdom

Financial serv.

Morocco

243.9

13.9

5%

421

442

21

Guelb Moghrein Copper-Gold Mine

Mining

Mauritania

243.0

ND

3%

422

-

-

Royal Swaziland Sugar Corp.

Agribusiness

Swaziland

239.8

21.2

30%

423

449

26

Alteo

Agribusiness

Mauritius

239.0

-28.7

3%

424

437

13

Société des Brasseries du Gabon

Food & drink

Gabon

238.4

ND

0%

425

432

7

Orange Tunisie

ICT/Telecoms

Tunisia

236.7

ND

14%

426

463

37

Auto Nejma

Auto industry

Morocco

236.4

16.4

11%

427

490

63

British American Tobacco Kenya

Agribusiness

Kenya

235.1

38.0

16%

428

480

52

Afrimat

Construction

South Africa

235.0

33.1

14%

429

342

-87

Driefontein Mine

Mining

South Africa

234.9

-181.6

-34%

Coronation Fund Managers

Financial serv.

South Africa

234.1

85.1

-12%

Egypt Gas Co.

Utilities

Egypt

233.7

1.4

61%

430

414

-16

431

-

-

432

460

28

Airtel Tanzania

ICT/Telecoms

Tanzania

230.2

13.8

7%

433

489

56

Egyptian International Tourism Co.

Tourism

Egypt

229.9

1.8

24% 10%

434

473

39

Workforce Holdings

Services

South Africa

229.5

7.0

435

459

24

Hyprop Investments

Construction

South Africa

228.9

7.9

6%

436

485

49

SNMVT – Monoprix

Retail

Tunisia

227.0

0.5

15%

437

-

-

Consolidated Infrastructure Group

Construction

South Africa

225.3

-95.5

4%

438

440

2

Al Arafa Holding

Textile

Egypt

225.0

15.2

-5%

439

435

-4

IndianOil Mauritius

Petroleum

Mauritius

222.3

5.9

-9%

440

456

16

National Co. for Maize Products*

Food & drink

Egypt

222.0

4.0

168%

441

486

45

Honeywell Flour Mills

Agribusiness

Nigeria

220.4

1.8

8%

442

-

-

Namibia Breweries

Food & drink

Namibia

220.3

66.2

18%

443

-

-

444

458

14

Britam Kenya

Financial serv.

Kenya

219.8

ND

8%

UAC of Nigeria

Diversified

Nigeria

217.0

-25.4

12% 13%

445

-

-

ENTP

Petroleum

Algeria

215.7

ND

446

475

29

Nu World Holdings

Transport

South Africa

215.6

11.5

4%

447

491

44

Airtel Kenya

ICT/Telecoms

Kenya

215.3

-27.4

7%

448

350

-98

Alliances Dev. Immobilier

Construction

Morocco

212.6

11.0

-38%

449

499

50

Zambia Sugar

Agribusiness

Zambia

211.7

- 2.6

8%

450

-

-

CFM

Rail transport

Mozambique

211.5

34.9

9%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

78

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

‘We can clearly see that the global economy is slowly emerging from lockdowns and the oil price is stabilising.’

MOHAMED ELGAMAL Maridive (#461)

451 - 500 Rank 2019

Rank 2018

Diff.

451

-

-

452

395

-57

453

479

454

472

455 456

Company

Sector

Country

Turnover (2019)

Net profits

Turnover change

Curro

Services

South Africa

209.4

13.3

21%

Transnational Corp. of Nigeria

Diversified

Nigeria

209.2

10.2

-27%

26

Phoenix Beverages

Food & drink

Mauritius

206.5

16.8

0%

18

Misr National Steel

Metals

Egypt

206.1

7.2

-1%

482

27

Airports of Mauritius*

Air transport

Mauritius

206.1

ND

1%

478

22

Petro Ivoire*

Petroleum

Côte d’Ivoire

206.0

0.1

13% 6%

457

-

-

458

484

26

459

-

-

Value Group

Transport

South Africa

204.8

9.1

Deneb Investments

Financial serv.

South Africa

204.2

-8.7

0%

EgyptAir Maintenance & Eng.

Air transport

Egypt

203.1

12.0

10%

460

-

-

CDC

Financial serv.

Tunisia

202.9

23.5

22%

461

474

13

Maridive

Petroleum

Egypt

202.8

12.9

-3%

462

498

36

MTN Zambia

ICT/Telecoms

Zambia

202.4

ND

2%

463

492

29

Gabon Télécom*

ICT/Telecoms

Gabon

201.7

ND

1%

464

-

-

MTN Congo

ICT/Telecoms

Rep. of Congo

202.1

ND

17%

465

500

35

466

-

-

Rössing Uranium Mine

Mining

Namibia

200.8

35.8

2%

EIPICO

Pharmaceuticals

Egypt

200.4

38.1

31%

Société d’Articles Hygiéniques

Chemicals

Tunisia

199.9

8.2

37%

Société Multinationale de Bitumes

Construction

Cÿÿôte d’Ivoire

198.8

0.1

-15%

467

-

-

468

446

-22

469

495

26

Compagnie Sahélienne d’Entreprises Construction

Senegal

197.4

4.8

3%

470

-

-

DRDGold

Mining

South Africa

196.4

5.6

14%

471

-

-

ABC Group

Diversified

Mauritius

196.3

11.8

3%

472

-

-

SGTD

Ports

Djibouti

195.8

108.1

ND

473

-

-

Lucara Diamonds

Mining

Botswana

192.5

12.7

9%

474

-

-

Agbaou Gold Operations

Mining

Cÿÿôte d’Ivoire

191.5

ND

6%

475

-

-

Agence Nationale des Ports

Ports

Morocco

190.9

7.9

3%

476

-

-

Nexans Maroc

Electrical equip.

Morocco

188.7

3.2

1%

477

-

-

EgyptAir Tourism & Duty Free

Tourism

Egypt

188.0

27.8

44%

478

-

-

SIVAC*

Agribusiness

Côte d’Ivoire

187.9

7.1

-27%

479

-

-

Buzwagi Gold Mine*

Mining

Tanzania

186.8

ND

-9%

480

-

-

Onelogix Group

Services

South Africa

186.5

3.3

-2%

481

-

-

Arabian Cement Co.

Construction

Egypt

184.9

1.9

5%

482

-

-

Petro Gabon*

Petroleum

Gabon

183.9

7.9

23%

483

487

4

PZ Cussons Nigeria

Chemicals

Nigeria

183.6

-19.8

-10%

484

-

-

Omatapalo

Construction

Angola

183.2

17.6

-21%

485

-

-

Empresa Nacional de Combustiveis

Petroleum

Cabo Verde

181.0

8.7

7%

486

-

-

Palmci

Agribusiness

Cÿÿôte d’Ivoire

178.8

-9.5

2%

487

-

-

E Media Holdings

Media

South Africa

178.2

-129.1

9%

488

431

-57

MRS Oil

Petroleum

Nigeria

177.9

-4.7

-28%

489

-

-

Majid Al Futtaim Kenya

Retail

Kenya

177.2

ND

31%

490

-

-

CFAO Automotive CI

Auto industry

Cÿÿôte d’Ivoire

176.6

9.0

4%

491

-

-

Jet Contractors (Ex-Jet Alu Maroc)

Construction

Morocco

176.5

12.6

2%

492

-

-

Les Eaux Minérales d’Oulmès

Food & drink

Morocco

176.2

1.2

6%

493

-

-

Sothema

Pharmaceuticals

Morocco

176.1

22.1

6%

494

-

-

Transaction Capital

Financial serv.

South Africa

175.8

56.0

18%

495

-

-

Sun Resorts

Tourism

Mauritius

175.7

-50.1

-8%

496

-

-

Unga Group

Food & drink

Kenya

175.0

5.3

-10%

497

-

-

Illovo Malawi

Agribusiness

Malawi

173.8

13.5

-10%

498

-

-

ASEC Holding

Construction

Egypt

170.0

ND

12%

499

-

-

Water Utilities Corp.

Utilities

Botswana

169.5

7.0

1%

500

-

-

OACA*

Air transport

Tunisia

169.1

15.0

3%

2019 results in millions of US dollars; *in italics 2018 results; ND: no data

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

79

AIRLINES

Ethiopian goes from strength to strength While others have suffered huge losses, the continent’s leading airline embraced flexibility and innovation during the Covid-19 crisis to come out on top

By LOZA SELESHIE

conscious decision to develop both its passenger business and its cargo business. So even before Covid, Ethiopian’s cargo business was solid and growing very fast,” says Raphael Kuuchi, consulting director for legal, industry and government affairs at the African Airlines Association (AFRAA).

Ethiopian Airlines (#33), which celebrates its 75th anniversary this year, is one of only three airlines in the world to have made a profit in 2020 (fiscal year ending in June). The sector has been hit hard by the consequences of the Covid-19 pandemic. Global cumulative losses have reached €103bn ($125.9bn), €1.6bn of Vaccine hub for Africa which are by the continent’s airlines. Ethiopian’s CEO, This model has enabled the airline to transport Tewolde GebreMariam, says the company “demonmedical supplies, and it continues to be a partner of strated agility, quick decision-making and resilience choice for the World Health Organisation, the United that have helped us” in the face of falling passenger Nations and the Chinese giant Alibaba in the global traffic, which, in Africa, registered a 69% drop in 2020 distribution of Covid-19 vaccines. compared to 2019 figures.

“By the start of May 2021, Ethiopian At the peak of the crisis, the company Airlines had transported more than 20m prioritised its air cargo business: 25 refitted doses of vaccine to more than 20 countries,” passenger aircraft joined the existing fleet says Chiedza Madzima, a research and of 12 cargo planes, Tewolde told The Africa operational risk manager at Fitch Solutions. of Ethiopian’s passenger Report. This is a growing subsector, and “Ethiopian is also developing an in-house aircrafts were refitted demand is already 9% higher than before dry-ice manufacturing facility that will seek for cargo to transport the crisis. “Ethiopian Airlines took a to address the need for additional medicines and goods

TIKSA NEGERI/REUTERS

25

Medical equipment donated

by Jack Ma arrives at Bole airport

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

9%

Ethiopian already has stakes in Chadian coolants and ultra-cold environments Airlines (49%), Zambia Airways (45%), for the storage and transport of vaccines.” whose relaunch has been postponed until at Madzima points out that these developments least the end of 2021, Malawi Airlines (49%), “will also provide long-term benefits for the rise in demand for air which is facing liquidation, and Ethiopian development of domestic and regional cold cargo services since Mozambique Airlines (99%), which has been chains – benefitting sectors such as horticulbefore the Covid-19 forced to suspend flights. Asky Airlines, ture, agribusiness and healthcare”. pandemic based in Lomé, Togo, appears to be less Romuald Ngueyap, founder of the website compromised, but it has turned to Ethiopian and its NewsAero, says Ethiopian “is positioning itself on the other shareholders (Ecobank, Banque Ouest Africaine corridor between Asia and the African continent, where de Développement and ECOWAS Bank for Investment it has the largest share of traffic. That makes Ethiopian and Development) to ask for financial assistance. strong.” In 2020, the company transported 54,400tn of “Some companies will go bankrupt, others will cargo to or from Guangdong airport in China, including recover with difficulty, but we are also seeing the medical equipment, industrial products, electronics and creation of start-ups,” says Ngueyap, the aviation computer equipment. journalist. “Currently, the price of aircraft is low, “It’s a triangular operation: Africa, Europe, China, and airports, whose traffic has declined, have taken and then Africa again, mobilising more than 50 planes initiatives to encourage companies that want to come per week,” says Tewolde. “Covid has had a positive to them. This is the case in Nigeria, for example.” impact [on Ethiopian’s activities in Asia].”

Ethiopian’s maintenance centre and aviation academy The airline also flies cargo from West Africa to could thus see new customers arrive, in addition to South America, and from Europe to the United States, those preparing to return to service. including clothes made for Zara (Inditex).“Ethiopian was already carrying out logistics from South America to Asia. They’ve done similar operations from Asia to A digital future Europe and from Asia to Africa. It has broadened their Ethiopian, which announced in 2018 that it had reached scope, and this has made other business partners look the goals of its ‘Vision 2025’ plan seven years ahead of at it as a solid partner,” says AFRAA’s Kuuchi. schedule, has been working on digitising its operations.

According to its CEO, the company has gone through The company invested more than $40m between 2015 the worst year ever experienced by the airline industry and 2020 to increase its online sales. After launching “without layoffs or salary cuts”, meeting all its financial its mobile app in 2018, the airline is now the first on obligations – maintenance loans, aircraft leasing, the continent to test the International Air Transport salaries – without additional support from the Ethiopian Association (IATA) health passport. state, its 100% shareholder.

On the continent, renewed competition could come from Egypt. EgyptAir (#68) has invested heavily in its fleet, with the purchase of 15 Airbus A320s in 2020. It Fingers in many pies also signed a $6bn contract to buy 54 Boeing aircraft in Bouyed up by its performance during the crisis, 2018. Although the Egyptian company is experiencing Ethiopian Airlines is on the lookout for new opportufinancial difficulties, it obtained a $130m loan from nities in Africa. In some cases it has come to the aid Cairo in January. Eager to develop its African activities, of other airlines. Last October, it offered operational it recently signed an agreement with Sudan Airways assistance (pilots, maintenance and aircraft) to troubled (operational assistance), as well as with Ghana for the national carrier South African Airlines (SAA) in a joint creation of a national airline. It remains to be seen how venture. SAA has since received a government grant Ethiopian and EgyptAir, both members of the Star of $641m and is reportedly close to concluding an Alliance, will manage this competition. agreement with an investor.

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Strive Masiyiwa: resurgent and raring to go

TELECOMS

Striving and thriving Zimbabwe’s Econet is betting on Africa’s digital future with its huge fibre-optic network and new data centres. Yet another example of CEO Strive Masiyiwa bouncing back

By OLIVIER MARBOT

Botswana to Lesotho, from Rwanda to Nigeria and Burundi, and to other continents. Masiyiwa continued to believe in the idea of not sticking to one specialisation, of being one step ahead. The group launched itself into satellite, terrestrial and submarine cables, subscription television (Kwese TV – its biggest failure to date) and, more recently, data centres, which it describes as “a revolution that will mark a new era for the technology sector”.

Zimbabwean telecoms billionaire Strive Masiyiwa has not yet run out of ideas. He recently helped to raise more than $1bn to ensure the growth of his group, Econet.

Masiyiwa, who celebrated his 60th birthday on 29 January and is well-known as a philanthropist, is also a member of the task force set up by the African Union to fight Covid-19 .

No thanks from the motherland Masiyiwa is the only billionaire from Zimbabwe.

Masiyiwa’s journey has not been without mistakes, and For more than 30 years, he has been one of the main that is what makes it exciting. He won his entrepreneurs leading the continent’s digital transformation. Famous for ending the state legal battle with the Zimbabwean authorities monopoly in Zimbabwe’s telecoms sector in over opening up telecommunications to competition, but he paid a high price for it as he the 1980s, the now London-based engineering graduate has, since his early days in business, had to leave the country, where his relations Africa Data Centres in with the political authorities remain tense. shown an uncommon capacity to bounce back. six countries will be In 2019, the Harare authorities’ decision to Masiyiwa quickly built an ecosystem around open by 2025, with a his Econet Group that extended beyond ban the use of foreign currencies on their combined power of Zimbabwe’s borders and invested massively soil and to authorise only the Zimbabwean 54MW and 24,000m2 of white space in South Africa. Subsidiaries spread from dollar almost brought him to his knees.

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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(It also caused Econet, ranked 125th last year, to fall off this year’s Top 500).

Between market mistrust and inflation, the local currency lost 95% of its value and the businessman, whose assets are still listed in Zimbabwe, saw his wealth plummet.

In a few months, his fortune fell from $2.3bn to $1.1bn.

Weakened by the failure of Kwese TV, financed via a $375m loan, Masiyiwa had to sell 8% of Liquid Telecom for $180m to relieve his group’s cash flow.

The Covid-19 pandemic and the related economic crisis have come at the worst possible time for the Econet Group and its boss. However, it managed to resurge in spectacular fashion during 2020. Its subsidiary Liquid

TSVANGIRAYI MUKWAZHI FOR TAR

EcoCash: mobile money for Zimbabweans

Telecom, renamed Liquid Intelligent Technologies, raised $840m on the markets in February 2021 to restructure its debt and continue its development. Managed by Nic Rudnick, it is now Africa’s leading fibre-optic operator, running a network of more than 70,000km of fibre-optic cables from Cape Town to Cairo, with a recent link to Moanda on the coast of DRC (see box).

At the end of 2020, another of its companies, Africa Data Centres (ADC), attracted the attention of the International Development Finance Corporation. The US institution, which supports investment in developing countries, invested $300m.

Control of African data

ADC, which already manages five data centres on the continent (in South Africa, Kenya and Togo) and is currently building one in Lagos, with plans to expand to other countries, is both promising and strategic. At a time when the supply of digital services – in particular cloud storage – is exploding on the continent, this is a decisive move. While the US has no intention of abandoning the field to Chinese companies, Africa itself must get involved if it hopes to retain control over the management of its data.

The billionaire’s impressive address book is no doubt a factor in his success. With former US president Barack Obama’s support, he has set up a programme to send young US citizens to work in his Africa-based companies at the beginning of their careers. He is also close to Chinese billionaire Jack Ma, to whom he helps open the doors of presidential palaces across the continent.

Connecting Congo Kinshasa, Kikwit, Kananga, Moanda, Mwene-Ditu, Kolwezi, Lubumbashi...

What do all of these cities have in common? They now have access to the 2,500km fibre-optic network laid by Liquid Intelligent Technologies (LIT) in the Democratic Republic of Congo.

This group, previously known as Liquid Telecom, is a subsidiary of the Zimbabwean group Econet Wireless, owned by Zimbabwean tycoon Strive Masiyiwa.

“Its new name confirms the strategic shift of the company, which has added IT and cybersecurity to telecommunications,” said LIT’s CEO for DRC, Michel Hebert, during a face-to-face meeting with the press in Kinshasa in March.

86

A second line is under construction.

It will be 4,000km long and will link the central-southern part to eastern DRC. With these two lines, the DRC will become the 14th member country of the One Africa Network, which totals more than 73,000km of fibre optics on the continent, from Cape Town in South Africa to Dar-es-Salam in Tanzania, or to Lubumbashi in the DRC. The communication infrastructure is legally the responsibility of the stateowned Société Congolaise des Postes et Télécommunications. However, the Congolese minister of post, telecommunications and new information and communication technologies, Augustin Kibassa, made it known at

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

the inauguration of the new network that the government had granted a waiver to LIT to allow it to build the backbone of the network.

“The DRC has only 4,000km of network whereas the need is for 50,000km. We have made the choice to move the country forward,” said Kibassa.

With its 2.3m square kilometres and 90 million inhabitants, the DRC ranks only 145th in the world for internet access. It has a penetration rate of less than 50% for cellular telephony and an estimated 30% coverage across the country’s territory. LIT’s fibre-optic network is therefore a game changer.

By STANIS BUJAKERA TSHIAMALA

ADVERTORIAL

Celebrating 45 years of Success The OPEC Fund for International Development (the OPEC Fund) is the only globally mandated development institution that provides financing from member countries to non-member countries exclusively.

We work in cooperation with partner countries and the international development community to stimulate economic growth and social progress in low- and middleincome countries around the world.

Our work is people-centered, focusing on projects that meet essential needs, such as food, energy, infrastructure, employment (particularly relating to SMEs), clean water and sanitation, healthcare and education.

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Together we drive development, strengthen communities and empower people.

Connecting Kenya The OPEC Fund dedicated US$12 million in financing towards upgrading Kenya’s Nuno-Mogodashe Road, which connects the towns of Garissa and Wajir, and to the North East region and neighboring Ethiopia and Somalia. The completed road has enhanced the population’s access to social services and eased travel to some of Kenya’s top tourist destinations, thus helping boost the tourism sector.

Total project costs of US$78 million were co-financed with The Arab Bank for Economic Development in Africa, The Kuwait Fund for Arab Economic Development, the Saudi Fund for Development, the Abu Dhabi Fund for Development, and the Government of Kenya.

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Photo: Francisco Marques/Shutterstock.com

THE POWER OF PARTNERSHIP IN AFRICA

INTERVIEW

Ralph Mupita

‘We are creating WeChat for Africa’

The CEO of MTN talks about the company's plans for growth, which involve a ‘superapp’ and supporting the growth of e-commerce on the continent

Despite its loss to Kenya’s Safaricom in the May bidding round for a telecoms licence in Ethiopia, MTN (#5) has grand ambitions. The South African group hopes to grow its offer into a payments and communication ecosystem that rivals those of China’s WeChat or the US tech giants. This will require raising new funds from investors, taking on other rivals in Africa like Orange, and investing heavily in fibre-optic infrastructure. The firm’s CEO, Ralph Mupita, explains how MTN will exit from its Middle East markets, which have brought it an entanglement with the US Justice Department.

You chose to separate mobile money from your other operations?

Why? RALPH MUPITA: Mobile money represented 46 million subscribers at the end of last year, 8% of group service revenue and $152bn of transaction value in our MoMo (Mobile Money) system. The business is expanding and we believe that a structural separation is needed going forward.

The second thing is that these businesses are actually very valuable. The current share price does not reflect the inherent value of the infrastructure or the platform assets of the fintech. We will create an opportunity, in due course, where investors can put money directly into this operation to reveal the value.

88

THEAFRICAREPORT

So is the plan to have an initial public offering (IPO) for MoMo? We will pursue the avenue that best reveals the value.

If it is through an IPO, then that is what we will focus on. Right now, we are not being prescriptive that the businesses need to be separately listed. You could have them unlisted and still revealing value. However, an IPO can also be the mechanism for this.

With the Ayoba app, you are in competition with the likes of Google and Facebook. How do you plan to compete with WhatsApp? We have very bold ambitions with Ayoba.

At the end of last year, we had 5.5 million monthly active users on the app. Over the medium term – three to five years – we will get to 100 million users.

Ayoba is an African-developed app. We have taken cognisance of what we believe are the specific needs and requirements of our customer base, and where Africa is in terms of internet adoption. So, when we developed Ayoba we focused on factors that would make Ayoba unique compared to the other global instant messaging apps. One of them is recognition of the level of literacy on the continent, thus the need for local-language versions. Secondly, we created emojis that are relevant, centred on understanding local needs. Third, we acknowledged that a lot of the subscribers in our market still use

CHRIS RATCLIFFE/BLOOMBERG/GETTY

Interview by QUENTIN VELLUET

ADVERTORIAL

Towards sustainable energy for all Our effort towards a just energy transition combines the need to reduce carbon footprint with the need for community development The current economic and health crisis has heightened awareness of the strong interdependence between economic growth and the health of the natural and social environment, and also of the essential need to combine economic development with a careful management of natural resources and the generation of social value.

Fighting energy poverty Ensuring universal access to energy in an efficient and sustainable manner – UN Sustainable Development Goal n. 7 - is the main challenge for the energy sector in the transition process towards a low-carbon future.

It is also a driver to meet the primary needs related to education, health and economic diversification. This is especially true in Africa, where 600M people still lack access to energy. Eni contributes to this challenge in many ways. In many countries of operations including Algeria, the Republic of Congo, Ghana, and Egypt, 100% of the gas we produce is destined for local markets, and to fuel local power plants. In other countries, Eni invests in the construction of infrastructure for the production and transport of gas both for export, and for local consumption. These initiatives are fundamental to fight energy poverty and meet the primary energy needs.

Strengthening African power systems In Ghana, Eni is operator of the Offshore Cape Three Points project (OCTP), the only non-associated gas project destined for the domestic market in Sub-Saharan Africa, which since 2018 has been feeding the Country’s power plants with a reliable, stable and sustainable energy source. In addition, Eni completed the Takoradi-Tema Interconnection Project in 2020, which transports gas from the Western Region to the eastern part of the Country, while continuing to transport gas from Nigeria to Benin, Togo and Ghana. Thanks to this, in 2020, 98% of Ghana’s thermal power was generated by gas, more than 50% of which came from the OCTP project. These projects meet Ghana’s growing energy demands and reinforce Eni’s commitment to fostering employment, local training and sourcing goods and services from local suppliers.

JAMG - PHOTOS DR

In this framework, Eni’s energy transition strategy aims at a significant reduction of the portfolio’s carbon footprint to be reached also through the contribution of gas, which in the long term will represent over 90% of our upstream sector. At the same time one of the fundamental objectives of our strategy is to enhance access to sustainable energy sources, promoting the use of locally produced natural gas in the transition to a low-carbon energy mix.

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2G phones. When you send a message on Ayoba from your smartphone to someone who has a 2G handset, it is delivered as an SMS. Are you following WeChat’s strategy with Ayoba?

Yes. Over time, we are looking to integrate mobile money into Ayoba. We have a huge mobile-money base with which to try and create a composite of the two – a bit of a WeChat recap. We want to create an ecosystem of merchants where mobile commerce can take place.

To be successful in creating this type of architecture for services and channels on Ayoba and link it to mobile money, we will ENGINEERING create a mobile commerce OPPORTUNITIES system that can accelerate 1972 Born in Zimbabwe the growth of the app and enhance that through the Early 1990s Civil Engineering degree at the concept of a WeChat for University of Cape Town Africa.

1996-1999 Worked as an engineer at Haw & Inglis

You say that you want to make selective acquisitions or mergers until 2000 MBA at UCT 2025. What markets are you targeting?

2001 Joined Old Mutual The selective mergers and South Africa acquisitions we are consid2012 Became CEO ering are those that “move for Emerging Markets the needle”: ones that can at Old Mutual change the profile of the group as it is today, with a 2017 Appointed Chief five-to-10-year horizon of Financial Officer at MTN growth. An example that would tick that box for us Sept. 2020 Appointed is to access opportunities Group CEO of MTN in Ethiopia. The country is a “‘needle mover”’ because we acknowledge the need to build the business for the long term. Today, Ethiopia represents probably one of the largest single-growth opportunities in Africa.

MTN plans to invest $500m in fibre. Which markets will be prioritised?

Internet adoption in Africa is at a very early stage, and, as the technology curve moves to 5G, we will see that even at a more nascent level. Data is what will underpin growth across markets in this continent. There is an incremental investment that will come in the near future, at least $1bn. We believe that $500m is what we would need to put in and we are very comfortable with that. At MTN, we largely do self-provision of fibre and very little is required from third parties. Going forward, the right model is an open-access one. We have the

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

‘AYOBA IS AN AFRICANDEVELOPED APP. WE HAVE FOCUSED ON THE NEEDS OF OUR CUSTOMER BASE’ ability, within fibre, to sell some of our capacity to third parties at a commercially-agreed pricing.

So you’re not particularly engaged in developing the fibre to the home?

There is the “own the home” opportunity, but fibre will actually be a fairly small part of that. There will be some interesting technologies that get us to own the home, such as fixed wireless access. However, we plan to get at least 10m homes across the African markets over the next three to five years. A large part of that will be in Nigeria, Ghana and South Africa.

Will the current legal troubles with US courts [over alleged payment of protection money to militant Islamic groups in Afghanistan] slow down the sale or impact the value of your Middle East businesses?

We are very cognisant of the issues that we are dealing with in the Afghanistan matter in the US courts. They are not directly impacting how we are looking to exit either Syria, Yemen or Afghanistan. We are independently looking to exit the Middle East in a very orderly manner within the near to medium term. Our strategy is two pronged: first, we look to exit the consolidated subsidiaries – Syria, Yemen and Afghanistan – and then, over time, the Iran project. The latter will take more time as it is where there is a major store of value: it is a significant business and we will continue to engage with our partners there to develop and then exit.

You are now the sole leader of MTN [after the end of the transition period with Rob Shuter in March 2021]. How would you define your your role?

I’m super excited about the prospects for MTN to deliver on the growth potential that we see in Africa, as well as to unlock value that we believe is embedded in MTN group in particular. As usual, there will always be challenges. We are not starry-eyed, we are realists; but you know, what gets us up in the morning is a sense that we can make a difference in Africa’s progress.

Africa has got a very unique opportunity to leapfrog industrially and economically by leveraging digital technologies. A lot of people say that 5G is only for the developed markets; but the counter view is that, when properly scrutinised, it has the ability to increase industrial capacity for Africa and economic growth.

INSIGHT NIGERIA/FRANCE /

NIGERIA / FRANCE NCE Ties that bind

The elegance of the gesture: presidents Buhari and Macron provide a black and white photo op

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THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

France's President Emmanuel Macron spent a formative period in Nigeria and is now pushing French corporates to seek opportunities beyond their comfort zone

ROMAIN GAILLARD/REA

By NICHOLAS NORBROOK in Lagos Of all the qualities French former leader Napoleon Bonaparte prized in his generals – or so the story goes – the most important was luck. France’s President Emmanuel Macron has had his share. For example, the implosion of the centre-left and centreright candidates in the 2017 elections, allowing him a clean shot at the presidency.

His first term has coincided with another piece of ‘luck’; the nativist inward turn of Brexit and US former president Donald Trump has left more space for France on the world stage, especially in Africa.

Macron has a particular vision for France’s relationship with the continent.

First, a more open approach to French abuses during and after the colonial era.

In 2018, for example, France officially admitted to the murder of Maurice Audin – a member of the Algerian Communist Party tortured to death by the French army during the war of independence. In Rwanda in May, Macron recognised France’s role in the 1994 genocide.

Macron is also pushing an activist economic diplomacy. It is bound up in a critique of France Inc., which he sees as too timid in its approach to global markets beyond its comfort zones. “Forty years ago, France occupied a prominent position in Nigeria,” President Macron told The Africa Report. “Major French companies

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

93

INSIGHT NIGERIA/FRANCE / Ties that bind BILATERAL TRADE BY PRODUCTS IN 2019 Exports from France to Nigeria (total: $719m) Machines Chemical products

occupied leading positions in the construction, manufacturing and logistics industries. More than 10,000 French nationals used to live in Nigeria at that time.”

But, in the the early 2000s, challenged by newcomers, French companies lost their way. Michelin and Peugeot, for example, had iconic factories in Port Harcourt and Kaduna respectively – both have since closed. Today, there are not even a thousand French citizens registered at the embassy in Abuja.

“The irony is that many successful foreign [non-French] companies employ French nationals in Nigeria today,” says Macron.

Nigeria is where Emmanuel Macron’s relationship with the continent began. In 2002, he spent six months as an intern at the French embassy in Abuja, and discovered a country that has little in common with more familiar Françafrique haunts like Abidjan, Dakar or Libreville. “[Nigerians] have no inferiority complex about France because the country is not on their radar,” Macron told Antoine Glaser and Pascal Airault in a recent book. “I was very happy [in Nigeria]. There was so much to do, with extremely entrepreneurial people, very creative, with whom I was able to have a relationship of equals in a very spontaneous and natural way.”

The ambassador thought it would be useful for the young intern to spend time outside the official French diplomatic circuits and sent him to see Jean Haas, who is currently the managing director of Relais International consultants.

Since the 1980s, Haas has been building a network of connections to Nigeria’s private sector.

Certainly, ‘hard’ factors like rising insecurity and poor infrastructure make life tough for businesses in Nigeria.

94

18.5%

Mineral products

Transportation 6%

Metals Animal Medical instruments 2.7% products 2.2% 3.5%

Vegetable products 4.2%

Plastics 3%

20%

(Refined petroleum: 19.8%)

14%

(Spirits: 5.3% Wine: 3.69%)

(Blood, antisera, vaccines, toxins and cultures: 5.3%)

Exports from Nigeria to France (total: $4.37bn) Crude petroleum 75.1%

SOURCE: OEC.WORLD

No inferiority complex

Foodstuffs

23.1%

Other 2.8%

Petroleum gas 22.3%

Other 2.6%

1 week

The time it would take the average Parisian to use as much electricity as the average Nigerian uses in a year

An editorial in Lagos newspaper The Guardian from February 2007 sounds eerily familiar today: ‘Michelin’s exit brings to the fore a number of issues,’ the paper opined. ‘The failure of government to provide an enabling environment for tyre manufacturers, the energy crisis and the effect on the cost of doing business, as well as the abuse of presidential waivers by some privileged Nigerians.’

But there are three ‘soft’ factors, too, that affect French companies in Nigeria – a lack of personal connections, a lack of nerve and a flexibility deficit. First, networks.

In recent decades French multinationals have heavily rotated their expatriate staff members, and boardrooms increasingly lack a ‘Monsieur Afrique’ to help maintain

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

networks. “Business in Nigeria is principally a story about people, and the connections between them – if you don’t have that, it is hard to operate,” says Haas.

ROK solid?

Next, nerve. Media house Canal+ has invested in Nigerian streaming service iROKO, created by Jason Njoku, famous for delivering Nollywood productions worldwide.

The French media company, owned

by Vivendi, has a clear Africa strategy: expanding in the major population centres of Ethiopia and Nigeria. But when ROK Studios, the production arm of iROKO, came on the market, even Canal+ vacillated over the purchase – despite it being a very modest amount, according to industry insiders.

“Companies from the US don’t ask themselves questions.

Netflix and Disney understand that the next Black Panther will be ‘Made in Africa’”, says Jacques Eliezer, a partner at Procadres International dispatched by Vivendi to turn around ROK. “Look

at Disney throwing millions at a Nigerian illustrator who has only written a few comic books” [referring to Iwaju, the series Disney will create with NigerianUgandan Kugali studio].

Of course, not all French companies lose their nerve in Nigeria. Despite having little visibility over the pending shake-up of Nigeria’s oil laws known as the Petroleum Industry Bill, TotalEnergies commissioned the largest offshore platform it has ever built, which is now operating at the deepwater Egina field. At its peak production of 200,000 barrels a day, this represents 10% of Nigeria’s entire oil output.

For Mike Sangster, Total’s managing director in Nigeria, “where Total was courageous was in carrying on” with the $16bn project after oil prices crashed in late 2014.

The final soft factor at play is what is needed to crack what has been dubbed the ‘fortune at the bottom of the pyramid’, i.e. targeting the small slice of disposable income of Nigeria’s 195 million people who are less well-off, rather than focusing on the five million who are well-off. It takes a certain flexibility to adapt products or services that might work in one context to another.

Milk cows replace milch cows

For French dairy giant Danone, it has been imperative to at least dip a toe into Nigerian waters. Hit by the ban on importing dairy products that is part of the Nigerian Central Bank’s ‘backward integration’ policy, the company reached for a more flexible approach. In July 2019 it bought FanMilk, a manufacturer of ice creams, yoghurt drinks and juices. This year it announced it would be building a flagship dairy farm in Ogun State to supply FanMilk with Nigerian milk.

“We are importing cows, but we will breed hybrids with local cows”

96

JAMES MARSHALL/GETTY IMAGES

INSIGHT NIGERIA/FRANCE / Ties that bind

to get a hardy but productive crossbreed, says Ferdinand Mouko, the managing director for Danone in Nigeria. A metaphor that is applicable elsewhere, perhaps.

Macron’s solution to plugging French companies back into Nigeria is to create a new France Nigeria Business Council, which will be launched on the margins of the Choose France summit at Versailles on 28 June.

This is the reincarnation of a previous initiative that didn’t quite work out. After Macron’s 2018 presidential tour of Nigeria, which included a trip to the ‘Shrine’ nightclub owned by the family of Fela Kuti, a Franco-Nigerian Business Dialogue was held in Lagos. But on the return leg to France, French business leaders

‘The Americans are furious that we managed to swing it’ EMMANUEL MACRON

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

were reluctant to meet visiting Nigerian CEOs. “Not one French CEO came,” Macron told Glaser and Airault, lamenting the shortsightedness of corporate France. “We had to get involved […]. In the end, Abdul Samad Rabiu [BUA Group] signed with us [a contract with French company Axens for the construction of a refinery (see page 100)].

The Americans are furious that we managed to swing it.”

That pendulum has not stopped swinging. BUA Group is, for example, signing with French group St-Gobain to build a plasterboard factory. In the energy sector, the financial close of Train 7 of Nigeria LNG will provoke a huge investment into gas from all stakeholders including Total (see page 120).

Launch pad

It is not just one way traffic, either.

Access Bank (see page 103) is opening a bank in France to help serve its clients in Francophone Africa who need correspondentbanking connections.

FRENCH TOUCH

Which are the French companies investing big in Nigeria?

metres, there is a petrol station, a supermarket, a shopping centre.

Turn right at the Eleko beach road and you hit the Lekki Free Trade Zone road along the coastal route. Dangote’s 650,000-barrela-day refinery looms above and is around 80% complete. Next to it, the completed fertiliser plant pumps out 3m tonnes of urea per year. Between them they will contribute to rebalancing Nigeria’s foreign-exchange reserves.

Joining the dots

Oshodi market, Lagos: still standing while Shoprite crumbled

Nigeria certainly requires courage and a real commitment to local partnerships. But it also carries a ‘Caveat Emptor’ sign around its neck in flashing green and white lights. No one, says Haas, should minimise the risk, even as they highlight the potential. “The challenges are exactly as you might have heard, only worse.”

The South African retailer Shoprite is the latest multinational to pack its bags, struggling with exchange rates, import bans and the spiking cost of infrastructure that puts its products out of reach for the middle classes that might visit a mall. But, almost under the radar in some cases, a series of refineries, free zones and ports coming online over the next two years could unlock the true potential of the country.

Some of them can be seen by hopping into a car and braving the endless traffic jams of the Lekki Peninsula east of Lagos. Housing and retail developments have mushroomed for tens of kilometres to Aja and beyond. Every few hundred

Further on, a red-fronted factory signals a joint venture by US cereals giant Kellogg’s and Singapore’s Tolaram. Opposite, China Harbour Engineering is on track to finish the Lekki deepwater port that will be operated by France’s shipping giant CMA CGM. For Dinesh Rathi, CFO at Tolaram, the combination of deepwater port and integrated free zone is a ‘silver bullet’ for those companies who spot the potential of the region but recoil from the infrastructure roadblock of Apapa and Tin Can Island.

Back in Victoria Island, a city is emerging from the water, built by the Chagoury Group (see page 110).

In Port Harcourt, another free zone is getting ready to welcome a sugar refinery that will target opportunities from the African Continental Free Trade Area and compete with sugar imports from Brazil. In northern Nigeria, sugar plantations and rice mills built by Nigeria’s leading conglomerates are acting as anchors for other investors.

Yes, the headlines of Nigeria’s newspapers warn about the disintegration of the nation, report on ethnic strife, stagflation, hundreds of school children kidnapped and the national oil company claiming it will be ‘unable to remit’ money into the government’s federation account. All this is true. But fortune favours the brave, as Napoleon might have said.

CGM CGA

The shipping and logistics company will operate Lekki deepwater port from 2023

DANONE

Partnered with Ogun State to build a dairy farm and training institute; bought FanMilk

CANAL+

Bought iROKO’s ROK Studios in 2019 – the first international acquisition in Nollywood

AXENS

Providing technical design and catalysts for BUA Group’s refinery in Akwa Ibom State

TOTAL

Commissioned its largest offshore oil platform at the Egina deepwater field

DASSAULT

Owns ExecuJet maintenance, repair and operations, servicing Nigerians’ private jets

ST-GOBAIN

Manufacturing group, partnering BUA to build a plasterboard plant in Ogun State

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

97

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INSIGHT NIGERIA/FRANCE / PLAYING TO WIN 1960 Born in Kano 1988 Established BUA 2008 Broke Dangote’s sugar monopoly

BRUNO LEVY FOR TAR

2020 Announces BUA will build a refinery

INTERVIEW

Abdul Samad Rabiu Groundbreaking developments The CEO and founder of Nigeria’s BUA Group is working with a series of French and other international companies to expand the conglomerate’s industrial operations Interview by NICHOLAS NORBROOK After the announcement in October 2020 that BUA Group had signed up French company Axens to deliver the technological heart of a new 200 barrel-per-day oil refinery, attention turns to the next phases of the project. The site location, in the southern coastal state of Akwa Ibom, has been picked for “its proximity to feedstock, and the deepwater draft of 14-16m”, says BUA’s founder and CEO Abdul Samad Rabiu.

With the US firm KBR working on the front-end engineering and design phases since 2018, Rabiu says that groundbreaking on the site will begin by the end of 2021.

Axens is not the only French company Rabiu is working with. He is also partnering with St-Gobain to deliver a plasterboard factory in Ogun State, where there is a plentiful supply of silica (quartz). “Currently, we import all our plasterboard – around 350,000 tonnes, so this is a real opportunity,” says Rabiu.

The new venture, which will cost in the tens of millions of dollars, will have a capacity of around 250,00-300,000tn.“I have to commend President [Emmanuel] Macron for the engagement he is paying to Nigeria,” says Rabiu.

It appears the feeling is mutual: Rabiu is the chairman of the France Nigeria Investment Club.

100 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

The refinery and subsequent industrial ventures BUA Group has undertaken have in some sense ‘de-risked’ the France-Nigeria relationship, argues Rabiu. “Now the most important thing is to keep up communication.”

BUA Cement, meanwhile, has signed a deal with China’s Sinoma to build three cement plants in Sokoto, Edo and Adamawa states.

This should bring total cement production for the group to 20m tonnes per year.

Sweet success

BUA Group is also accelerating its agribusiness division. A 20,000ha integrated sugar plantation and refinery is being built in Lafiagi.

It will use Israeli dripfeed technology to irrigate the cane – “a first in Nigeria”, says Rabiu.

Another sugar refinery is under construction in the Port Harcourt free zone, “and the beauty of this is that it is a destination refinery”, says Rabiu. He wants to take advantage of tariff harmonisations and exemption within the African Continental Free Trade Area to compete with refined sugar imports from Brazil and India.

A new partnership with Italy’s Fava will result in an integrated wheat-milling and pasta-making project, which Rabiu says will be the biggest in the country – although his rivals, like Singapore’s Olam may not agree.

Together with his edible oil business, Rabiu is rebranding all these agro-processing initiatives as BUA Foods, and hopes to list the entity on the Nigerian Stock Exchange by the end of the year.

“We will put up 20%-25% of the company for sale,” says Rabiu.

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INSIGHT NIGERIA/FRANCE /

PROFILE

Aliko Dangote

Industrialisation nation

Africa’s richest man and the founder of Dangote Industries is launching Nigeria’s largest ever industrial project, which includes a refinery and a fertiliser plant

By NICHOLAS NORBROOK Visitors to Dangote’s refinery often struggle with the scale, whether craning heads up to the 112-metre crude column or driving along the 125km of internal roads within the site on the Lekki peninsula, some 80km east of Lagos. “I call it an industrial city,” says Giuseppe Surace, the chief operations officer at the Dangote Oil Refinery. “It is 19 interconnected projects.” Some 40,000 workers are active daily on site, with 30,000 living within the perimeter fence.

Alongside the storage tanks, a 3.6 million-tonne-per-year polypropylene plant sits next to a power station. In the distance, an already operational urea plant is pumping out fertiliser at a rate of 3m tonnes per year. Although there are filling stations, the majority of the petroleum

REFINING THE AGENDA 1957 Born in Kano

DENIS ALLARD/REA

1977 Established the Dangote Group

102

2012 Built Dangote Flour Mills in Apapa port 2018 Broke ground on the Dangote Refinery

products will be piped out to offshore berths able to accommodate the world’s biggest tankers.

Hit by delays linked to Covid-19, design changes and the difficulties of building a 650,000 barrel-a-day refinery and petrochemicals project on a coastal swamp, the refinery is

in its final sprint to the finish line.

“Mechanical completion should be by the end of the year,” Aliko Dangote tells The Africa Report.

That would leave three to six months for commissioning and tests before production hits a steady rate, say workers on the project. Ahead of that, a trading area utilising the already completed storage tanks and offshore tanker berths will start operations.

Dangote Industries is still best known for cement. Africa’s largest cement manufacturer will soon ramp up production from 50,000tn per day to 70,000tn per day. Spare capacity at a plant in Benue State will be used to meet a 40% jump in demand as the economy restarts.

Churning it out

Nigeria has an estimated housing deficit of 7m units, and lawmakers have announced plans to encourage more competition in the market.

Edwin Devakumar, group executive director at Dangote Industries pushes back at complaints around the cost of cement, telling media that price rises are linked to rising production costs. “About 50% of our costs are linked to US dollars, so the cost of critical components like gas, gypsum, bags, and spare parts has increased significantly due to devaluation of the naira and the VAT increase,” Devakumar says.

Dangote Industries has also invested heavily in agriculture in recent years, in particular sugar and rice. An integrated rice mill project in Jigawa State will buy rice from contract farmers and supply them with fertiliser and training. Similiar projects are under way in Kano, Sokoto, Zamfara, Kebbi and Niger states.

INTERVIEW

CHEVENING

Herbert Wigwe ‘We want to be the Citibank of Africa’

BORN FOR BANKING 1966 Born in Lagos 2002 Bought a small commercial bank with Aigboje Aig-Imoukhuede

The CEO and group managing director of Nigeria’s Access Bank tells The Africa Report why the time is right for its continental expansion, and what lessons have been learnt Interview by NICHOLAS NORBROOK in Lagos From modest beginnings as a small wholesale bank in 2002, to Nigeria’s largest bank by assets, loans and deposits, Access Bank has mastered the art of inorganic growth. The purchase of Diamond Bank in 2018 and of Kenya’s Transnational Bank in 2020 have kept managing director Herbert Wigwe busy, from building a common culture to integrating the banking platforms on which each bank runs.

“Its not the first time we’ve done this kind of merger,” he says, referring to the 2011 purchase of Intercontinental Bank. “But these things take a minimum of five years to bed down properly.”

Access Bank had long sought to pivot to retail banking, and the pace of change of mobile banking has given things a boost. “Fifteen years ago, the cost of serving these customers would have been horrendous,” says Wigwe. “Today you can sign up hundreds of thousands of customers straight from their mobile phone, and also meet the

anti-money laundering/know your customer requirements.”

He can lean on the skills Access Bank acquired while helping South African telecoms giant MTN enter Nigeria in the early 2000s. “We had to train people in basic bookkeeping, and those people became the distributors for MTN – they were the boys selling scratch cards on the streets. Then we helped MTN in its roll-out of phone mast sites.”

Intra-African trade

Access Bank has pan-African ambitions. “We want to be the Citibank of Africa,” says Wigwe.

Is there enough intra-African trade to justify that? Wigwe points to the gap left by international banking groups in recent years as Basel III and other regulations make compliance more costly for global banks.

“There is no point in waiting for other banks from other continents to come and serve you. You must create your own,” says Wigwe.

The African Continental Free Trade Area offers proof, he says, that intra-African trade is set to

2014 Succeeded his business partner as group managing director of Access Bank, now the largest bank in Nigeria

increase through formal channels.

Intra-African payments are also on the rise – Nigerian parents paying school fees in Ghana, for example – while there are also investments and remittances worth billions of dollars. “And we want all of that to be coming through our franchise,” says Wigwe. To beef up its correspondent-banking links, Access Bank has an office in London that will soon be joined by a new banking operation in France.

Nigerian banks have been burnt in continental expansion in the past.

Wigwe says the lessons have been learnt: the main one being about the business case. For the planned expansion into Mozambique, for example, he points to the growth of the gas industry, where there are Nigerian companies present.

He is also transparent about Access Bank’s own failings. “We had to shut down a branch in Côte d’Ivoire,” says Wigwe. The bank will be returning with a fresh approach. “But nothing will stop us from creating that global institution that we seek to create.”

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

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INSIGHT NIGERIA/FRANCE /

BUSINESS AND GIVING 1963 Born in Jos, Plateau State 2010 Founded Heirs Holdings and the Tony Elumelu Foundation

BRUNO LEVY FOR JA

2015 Ranked 31 on Forbes’ 50 Richest Africans list

INTERVIEW

Tony Elumelu ‘Goods – that’s where the problem has always been’ The Heirs Holdings chairman says the movement of goods is a major challenge for African free trade due to bottlenecks and poor infrastructure Interview by NICHOLAS NORBROOK in Lagos Elumelu’s integrated energy play is taking ground: his January 2021 acquisition of OML 17 has been hooked up to his 966MW Afam power plant in Rivers State, acquired in November 2020.

“The next thing is for my gas cooker at home to be connected to OML 17,” Elumelu jokes. The addition of Afam brings generation capacity for Heirs Holdings up to 1,936MW, including the Ughelli power plant in Delta State.

The group is feeling the effects of Nigeria’s economic turnaround as it covers almost all sectors of the economy. Occupancy rates in the Abuja Hilton, owned by Heirs

Holdings, act as a handy indicator.

“During the pandemic they were down to 20%; now they are back up to 60-70%,” says Elumelu.

And 2021’s first quarter unaudited earnings for the UBA Group – which includes banks in 20 countries, show profits up 24%.

For Elumelu, Africa will soon see real change driven by regional integration. While continental expansion is seen by some as a liability, UBA’s network will become an asset when intra-African trade takes off.

“We are improving in the movement of people and in the movement of capital,” he says.

“Goods – that’s where the problem has always been. I want to see an

106 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

African economy where goods are cleared at the port in two hours.”

In 2020, Nigeria’s central bank sucked N900bn ($2.2bn) out of the banking system by raising the cash reserve ratio to 27.5%, while also pressing banks to lend more to the private sector. Elumelu’s view is: “In fairness to the regulator, they have a mandate.”

Central bank not profit-driven

“They look at liquidity, inflation, – they have their own objectives,” says Elumelu. “And, most times, are those objectives in sync with the banks? No. But the central bank is not profit-driven; they want to catalyse development. As a bank chairman, I may not want them to raise the cash reserve ratio, but for the central bank it may help them achieve their monetary policies.”

What about the directives to lend more to small businesses? After all, small and medium-sized enterprises (SMEs) face double-digit interest rates when they go to the banks, including UBA. Here, Elumelu’s critique sharpens.

As head of the Tony Elumelu Foundation, which gives “non-refundable seed capital, training and mentoring” to start-ups, he sees the difficulty of helping them reach escape velocity in Nigeria’s oppressive business climate.

“There are banks who try. They end up with non-performing loans (NPLs) to deal with. Economic operatives cannot outperform their macro environment,” says Elumelu. “And the same authorities that push you to lend will come back to say your NPLs are high.

There can be severe sanctions against such banks.”

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INTERVIEW

‘This is a strategic relationship’

ENERGY MULTIPLIER 1953 Born in Ibadan, Oyo State, Nigeria 1979 Made first million aged 26

The founder of Glo and Conoil credits several of his successes in business to partnerships with French firms Interview by NICHOLAS NORBROOK Telecoms and energy businessman Mike Adenuga says he has leant on French technology partners to build his fortune. “Our relationship with French business has been a long and extremely beneficial one,” he says.

It started in the early 1990s, after Adenuga’s Consolidated Oil struck commercial quantities of crude in Ondo State.

“The genesis and bedrock of that relationship was the energy team at the Banque Nationale de Paris (BNP) Paris office, led by Guillaume Leenhardt. A great deal of our early success can be attributed to the professionalism, customer orientation and creativity of that team,” says Adenuga. “We worked extremely hard and well together to meet some ridiculously tight deadlines – working through the night till 6am only to resume work again at 8am after a quick nap and shower! Those are days I remember with a lot of fondness.”

It is telecoms, however, for which Adenuga is best known.

The company he founded, Glo, is

the largest indigenous telecoms company in Nigeria, the second largest operator after South Africa’s MTN. “Soon after the award of our telecommunications license in 2003, our relationship with another prominent French company, Alcatel, led at the time by Serge Tchuruk, enabled us to fast-track the roll-out of our infrastructure and close the gap on the competition, which had had a 15-month head start,” says Adenuga.

Cheap data

“Alcatel was tremendously supportive, and needless to say, Glo would not be the entity it is today without all of Alcatel's equipment and support.”

Glo is present in Ghana, but quit the Benin market after a dispute over its operating licence. Its

‘WE WORKED EXTREMELY HARD AND WELL TOGETHER’

108 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

2018 Awarded the Légion d’Honneur by Emmanuel Macron

investment in the GLO-1 submarine cable connecting Lagos to the UK has allowed Glo to offer cheap data to subscribers – which it uses in the increasingly brutal battle for dominance in Nigeria’s telecoms sector. While trailing MTN for total market share, Glo has been adding data customers at a faster clip.

Another key relationship for Adenuga is with French oil major TotalEnergies.

“We won the concession to an offshore block in which we then discovered substantial amounts of oil and gas resources, with certified gas resources in excess of eight trillion cubic feet.

TotalEnergies subsequently farmed into that asset,” he says.

“This is a strategic relationship; we intend to commence production with a floating liquified natural gas facility soon.”

Adenuga, a connoisseur of French cuisine, concludes: “I have been only too happy to promote French business and culture in Nigeria - The Alliance Française in Lagos, known as the Mike Adenuga Centre, is a testimony to that.”

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INTERVIEW

Gilbert Chagoury ‘The concept is work and play. You don’t need to leave’ The co-founder of the Chagoury Group talks to The Africa Report about building a city within a city Interview by NICHOLAS NORBROOK Where Victoria Island meets the Atlantic Ocean, a vast land reclamation and urbanisation project by the Chagoury Group is changing the Lagos skyline. Eko Atlantic City, founded in 2003, was intended n off Victoria to stop the erosion i i ng a commercial Island while creatin y within Nigeria's and residential city economic capital.

“The concept is ‘work and play’,” oury. “You don't says Gilbert Chago o anywhere else.” need to leave to go 0 by brothers Founded in 1970 d Chagoury, the Gilbert and Ronald its activiChagoury Group started s ties in flour milling and expanded into construction and a property development, wate er bottling, insurance, hotels, manufacturing, telecommunication ns, information technology, glass manufacturm ing, catering and in nternational SUSTAINABLE CITY BUILDER

BRUNO LEVY FOR TAR

1946 Born to Lebanese parents in Lagos 1970 Co-founded Chagoury group 2008 Started building Eko Atlantic City

110 THEAFRICAREPORT / N° N 116

financing. Eko Atlantic is not the first urban development the group has executed in Lagos.

“Back in the 1990s, the high-end Banana Island project was launched, accelerating the group’s skills acquisition,” says Chagoury.

Seven times larger than Banana

Island, Eko Atlantic has been a test of those consolidated urbanisation capabilities.

“Apart from dredging sand, everything in this new city is done in-house by different companies of the group,” says Chagoury. “It is developed as an eco-friendly city.” Hitech, the civil engineering wing of the group, is bringing new technology into the city’s roads – the concrete paving of the Lagos airport road, for example.

“Likewise, the tower-building division ITB Construction has brought modern high-rise building techniques into Nigeria,” he adds.

Great Wall of Lagos

Flanking the flagship Eko Hotel, two residential towers and two office towers have been built in the past few years for France’s TotalEnergies. “Kingsway Towers, Heritage Towers, the Intercontinenta i al, Four Points... the list goes on n,” he says. The new developme ent is pivotal to the fortunes of the e group, with billions of dollars invessted, including for the 8.5km long g and 19-metre high barrier known as the ‘Great Wall of Lagos’ to protect the new city against erosion n by ocean surges.

The collapse e of the oil price in 2014 and the e coronavirus have slowed constru uction, but the group is bullish on its prospects, with 10 towers under way thiis year, four already occupied. The US consulate has purchased land, becoming a useful anchor client and, Chagoury notes, “ “discovery of oil off th he coast of Lagos wiill also help – an oil services company has tak ken several plots, and is b building residential tow wers to be completed in S September 2021.”

TRADING PLACES 1974 Born in Paris 2007-2018 MP for Seine-et-Marne (UMP party) 2018 Minister of Culture

INTERVIEW

6 July 2020 Minister Delegate for Foreign Trade

Franck Riester

BRUNO LEVY FOR TAR

‘A new way to finance African economies’ France’s minister of foreign trade says the country is working on a fairer way to engage with Africa, especially as it looks to develop its relationship with Nigeria Interview by RUTH OLUROUNBI in Abuja Paris is looking to expand its bilateral relationship with the biggest economy on the African continent, says Franck Riester, France’s minister of foreign trade and economic attractiveness.

There has recently been a flurry of Franco-Nigerian activity. In 2020, French energy company Axens signed a deal to help on the multibillion-dollar refinery being built for Nigeria’s BUA Group in 2020. French oil giant Total’s Egina platform, a 200,000 barrelper-day facility, began production in December 2018.

France is also the second-largest bilateral creditor to Nigeria after China, through the Agence Française de Développement. It has invested more than €2bn ($2.4bn) in the past 10 years, financing 35 development projects, according to government officials.

Interviewed in Abuja during a two-day visit to Nigeria on 13-14 April, Riester told The Africa Report that he wants to see “more

partnerships between our two countries, more French companies investing here, more Nigerian companies to invest in France and more exports and imports between our two countries.”

Aliko, Abdul and the band

Visiting Abuja and Lagos, Riester met with his counterpart, Nigeria’s minister of industry, trade and investment Otunba Niyi Adebayo, along with representatives of Fanmilk/Danone, CFAO, SPIE, Biogaran and Vinci Energies.

In Lagos, he met the members of the Franco-Nigerian Business Dialogue, including its president, BUA Group chairman Abdul Samad Rabiu, Access Bank managing director Herbert Wigwe and Dangote Group chairman Aliko Dangote. He also visited the Tin Can Island port concession run

by French company Bolloré and the Eko Atlantic City project.

The trip was an attempt to build on the priorities set by President Emmanuel Macron during his official visit to Nigeria

in July 2018. It was also a sign of Paris’s “willingness to change the narrative of the relations between Africa and France”, says Riester.

Nigeria is France’s top commercial partner in sub-Saharan Africa, with bilateral trade between the two countries nearing $5bn in 2019. With the advent of the coronavirus pandemic, that figure fell by $2.3bn in 2020, according to Riester. He says he wants a win-win situation where Nigerian companies can set up in France, just as more than 100 French companies have done in Nigeria.

“We are working for a new, more sustainable, more fair way to finance, to fund African economies,” says Riester. “We want to find ways to facilitate companies in Nigeria to create more jobs and to create more growth, with partnerships for instance, around the issues of security, of corruption, of legislation and regulation.”

“And we think that we are in it for the long term because we want win-win collaboration. We want to invest all over Nigeria, not only in Lagos or Abuja. Nigeria is a huge market,” says Riester. He also stressed that France wants to go further, beyond the Francophone African countries, where it is already well represented.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

111

Africa, a key continent at the heart of our strategy

TotalEnergies, leader in Africa TotalEnergies has developed partnerships in Africa for more than 90 years.

GONZALEZ THIERRY - TOTAL

Egina FPSO’s operators

TotalEnergies is a broad energy company that produces and markets energies on a global scale: oil and biofuels, natural gas and green gases, renewables and electricity. Our 105,000 employees are committed to energy that is ever more affordable, clean, reliable and accessible to as many people as possible.

Active in more than 130 countries, TotalEnergies puts sustainable development in all its dimensions at the heart of its projects and operations to contribute to the well-being of people.

To contribute to the sustainable development of the planet facing the climate challenge, we are moving forward, together, towards new energies. Energy is reinventing itself, and this energy journey is ours. Our ambition is to be a world-class player in the energy transition. TotalEnergies has decided to massively develop renewable electricity generation. Its goal is to reach 100 gigawatts of production capacity by 2030 and become one of the top five companies in the industry.

In the exploration and production sector, we produce oil and natural gas in Nigeria, Angola, Congo and Gabon and operate major development projects in Mozambique and Uganda.

TotalEnergies is the leading deep offshore operator in Africa. The 11 deep offshore production facilities operated by TotalEnergies’ affiliates in West Africa are a testimony to our technological expertise and operational excellence.

Natural gas is also a key part of our strategy in Africa. Our company is a partner in Nigeria LNG and Angola LNG. Mozambique LNG project will contribute to strengthen the position of TotalEnergies in the LNG sector with the development of the Golfinho and Atum fields.

In April 2021, we signed the final agreements to launch the Lake Albert

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development project, including the Tilenga and Kingfisher upstream oil projects in Uganda and the construction of the East African Crude Oil Pipeline (EACOP) in Uganda and Tanzania.

These projects are undertaken in a sensitive environmental and social context, and we are mobilizing significant resources to ensure that they are carried out in an exemplary manner and create value for the people of both countries.

In the renewables sector, TotalEnergies is involved in several solar projects in Africa, such as the Prieska photovoltaic plant (86 MWp installed capacity) in the Northern Cape of South Africa, solar power plants currently in operation in Egypt (2×63 MWp), Burkina Faso (15 MWp) and Uganda (10 MWp). The Gas and Renewables branch is developing our global portfolio of low carbon

energies including solar, wind, biomass, and hydrogen.

In the marketing and services sector, our company is leader in Africa with a network of more than 4,700 service stations and is recognized as the emblematic energy company by individual and business customers on the continent.

As a major energy player in Africa, we are actively working to reduce the greenhouse gas emissions associated with our activities. We are also developing businesses to preserve and develop ecosystems that act as carbon sinks. In March 2021, TotalEnergies signed a partnership agreement with the Republic of the Congo to plant a 40,000-hectare forest on the Batéké Plateaux, creating a new carbon sink that will sequester more than 10 million tons of CO2 over 20 years.

TotalEnergies and its partners have launched the expansion of the natural gas liquefaction plant in Bonny Island from the current 22 Mt to 30 Mt by 2025 (“NLNG Train 7” project). Our company is also supplying natural gas to the domestic market for power generation and production of fertilizers.

In the downstream sector, TotalEnergies leads the retail activities with a network of nearly 580 service stations delivering a wide range of topquality service to our customers. Our operations include 17-customer service centers, 5 White Product Depots, 2 Lubricants blending plants and numerous industrial outlets which are strategically located across Nigeria to ensure smooth delivery of products to customers.

VALE CHERIE - NEWSPORT MEDIA - TOTAL

Egina FPSO offshore.

In Nigeria, TotalEnergies operates over 15% of the country’s oil and natural gas production. Our company has maintained a sustained investment program in Nigeria over the past few years, including the development of the last three deep offshore Production Facilities (FPSOs), Akpo (2009), Usan (2012) and Egina (2018). The Egina project represented a major step forward in the development of local industrial capacity, with 77% of the overall manhours carried out locally. We are currently developing a new offshore production facility, the Ikike project, in partnership with the Nigerian National Petroleum Corporation.

Prieska photovoltaic power plant, SunPower, TotalEnergies’ affiliate.

www.totalenergies.com

JAMG

TOTAL E&P NIGERIA LTD - TOTAL

Our activities in Nigeria

RÉDÉRIC DE LA MURE

INSIGHT NIGERIA/FRANCE /

BRUNO DELESSARD/CHALLENGES-REA

Team France’s succcess in Nigeria could rest on a useful blend of officials and commercial leaders working with well-networked grass-roots players

Patrick Pouyanné

Total transformation

Appointed CEO of TotalEnergies – formerly Total – in 2014, Pouyanné comes from the Elf branch of the organisation, having served as general secretary to the Angolan unit of Elf before it was absorbed into Total in 2000. In May he announced TotalEnergies’ “intention to transform itself into a multi-energy company to respond to the twin challenges faced by energy transitions: more energy and fewer emissions”. Nigeria is central to the fortunes of TotalEnergies and a key profit driver. Many of the top Nigeria directors go on to leadership positions in the organisation.

Jean Haas Haas represented the French national defence industry for sales in West Africa from the early 1980s, founded Relais International consultants and spent the next decades representing Dassault, Alstom, Airbus, Naval Group and others in South Africa and Nigeria. President Emmanuel Macron asked Haas to take over coordination of the FranceNigeria Business Council in 2020.

114 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

BRUNO LE VY FOR TAR

Relay man

Jérôme Pasquier

Visits and returns France’s ambassador to Nigeria since 2018, previously in South Korea and Croatia, Pasquier has overseen a number of French investments in Nigeria. He recently led a trade delegation to Cross River State and to visit the deep-sea port under construction in the Lekki Free Zone, which will be operated by French logistics giant CGM CMA. He will also oversee the restitution of artworks looted from the kingdom of Benin.

Franck Riester

Cars, contracts and culture Having started out running the family car business, Reister is now the minister delegate for foreign trade and economic attractiveness. He is deeply involved in the quest for new markets in Africa, travelling to Nigeria, Senegal and Côte d’Ivoire in recent months to sell President Macron’s New Deal for Africa.

He previously served as culture minister.

Jean Sentenac

Refined business

French hydrocarbons group Axens had failed in several previous bids for refinery contracts. So when the technology partner contract for BUA Group’s refinery was put out to tender, Axens fought hard to head off strong competition from the US company Honeywell UOP, according to sources close to the bid. In 2020 BUA Group finally chose Axens, a deal emblematic of the new FrancoNigerian cooperation.

NEW ENERGY SERVICES COMPANY LIMITED New Energy Services Company Limited (NESSCO) is a leading provider of integrated energy services which includes Inspection, Maintenance, Operation &Repair (IMOR) with complementary solutions across the assets and program life cycle within the onshore, offshore and subsea market segments of the Nigerian oil and energy sector.

At NESSCO, we ensure that our client’s expectations are met and exceeded by collaborating with reputable technical service providers and the best original equipment manufacturers (OEM) across the globe. NESSCO Supplies, Installs, Operates, Services, Maintains and Certifies Cranes with other lifting equipment.

NESSCO is ISO 9001, ISO 45001 Certified, & a member of Lifting Equipment Engineers Association (LEEA).

Technical Alliances

NESSCO is in strategic Joint Venture Partnership with ITP Interpipe (registered in Nigeria as NESSCO Interpipe Solutions Nig. Ltd.), to provide innovative pipeline solutions which offers the best performance on the market and can be adopted to various applications. These includes:

!

Insulated Subsea Flowlines !

Cryogenic Pipelines Heat Traced Flowlines ! !

Ultra High Temperature Pipes !

Refrigerated Pipelines Downhole Applications !

Insulated Riser Tubing ! !

Carbon Capture & Storage

Southport Construction Nigeria Limited (an affiliate of NESSCO) is in Joint Venture Partnership with Eiffage Metal, France to implement the UNIBRIDGE and Prefabricated Building Solutions (PBS) in West Africa (such as the Ofon Phase II Living Quarters Project). With over 100,000 completed projects across the globe, Eiffage is one of Europe's leading construction and concessions companies.

The Unibridge Solution has been applied in Jetty/Port construction, road construction, flyovers, rail system, military application and pedestrian bridges across five (5) continents.

Eiffage PBS focuses on electrical substations, offshore accommodations, control rooms, workshops, laboratory rooms, living quarters / E- Houses, etc.

Head Office: Plot 292H Ajose Adeogun Street, Victoria Island, Lagos State, Nigeria.

Operational Base: 124BB Trans-Amadi Industria Layout, Port Harcourt, River State, Nigeria.

Email: info@nesscong.org Website: www.nesscong.org

Phone: +234 (0) 1 - 816 - 4139 Mobile: +234 (0) 805 - 098 - 7582

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INSIGHT NIGERIA/FRANCE /

FREE-TRADE ZONES

Set them free Nigerian special economic zones and free zones are taking off, providing investors with the infrastructure and facilities they need to target local and international markets

By NICHOLAS NORBROOK in Lagos

Several are now at advanced stages of construction and operation.

Tolaram, a Singaporean agri-processor, is running the Lekki Free Zone east of Lagos.

“The master-planning of the zone is by Surbana Jurong, one of Singapore’s topmost town planners,” says Lekki Free Zone CEO Dinesh Rathi. “Our group [Tolaram] has been in the manufacturing business for 50 years now, operating around the world. In Nigeria, we run 19 factories.”

The project integrates a deepwater port and has several anchor clients, including the second factory Kellogg’s has built in Africa and a Dano Milk factory from Arla. The sectors that Tolaram expect to be attracted to the zone are: food and beverages, pharmaceutical, chemicals, non-metallics

Special economic zones (SEZs) and free-trade zones were the spearhead of Asian industrialisation – allowing countries with major deficits in power, logistics and bureaucracy to pull in investors. Many of those zones were designed by Singaporean planners, who learned from Japan, the famous ‘flying geese’ development model through which capital and know-how cascades from country to country.

Will geese land in Nigeria? It has 33 such zones. But only 15 are active, and the government has not fully backed them. For instance, during Sanusi’s term as central bank governor, it did not allow repatriation of profits.

Sabre rattling

Lekki: port of the future

DR

“Challenges such as low investor confidence due to frequent arbitrary changes in government policies and some political and social developments, including insecurity in different parts of the country, have negatively affected investor confidence,” says lawyer Afolabi Caxton-Martins of Dentons ACAS-Law. In addition, “in certain cases, the states where some of the free-trade zones are located are simply not viable and were bound to struggle to succeed from inception,” he says This has changed. The Nigeria Export Processing Zone Authority (NEPZA) is more stable under its current management – sabre rattling by the Onne zone notwithstanding.

116 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

and logistics. “Given that the port is integrated into the zone, that will allow us to incubate the entire logistics vertical,” says Rathi.

Along with the warehouses that have been built to lease, to allow investors to “focus on their core business”, Rathi argues the integration of a port into the project makes it a “silver bullet” for those who want to use Nigeria as a hub for manufacturing in West Africa.

Help with red tape

The Lekki backers hope to achieve similar levels of ease of customs clearance as Singapore, he says, “something that is helped by the SEZ status. The government agencies [involved in clearing freight] are all housed under the same roof, and we are putting automation processes in place.”

This helping hand with red tape is a key draw for investors, says David Frame, managing director of South Energyx, the developers of Eko Atlantic City, another free zone. The project management is in discussion with the central bank, mediated by NEPZA, over the possible offshore status of banks that set up in Eko Atlantic.

Government backing is critical for connecting infrastructure.

F. LEFEBVRE/CMA-CGM

LAURENT MARTENS Vice President Ports and Terminals, CGM CMA

‘Lekki will change Nigeria’s import-export story’

The Lagos State government is upgrading the road connecting to the city. Along the Lekki-Epe Expressway, north of the Lekki Free Zone, lies Alaro City, another free zone, set on 1,000ha carved out of the bush. It too has an anchor client up and running, Ariel Foods.

Around 40 companies now have purchased land here, with a handful already building their factories.

For Babatunde Olaifa of Rendeavour, the company running the zone in partnership with the state government, the ability to bring goods out of Apapa port without going through the lengthy customs procedures is a major draw to investors. “Instead, they are inspected here at Alaro,” he says. It is attracting both local and international investors.

Why invest in the Lekki port?

Investing in Nigeria, the country with the greatest population on the continent, is a good choice. The existing port facilities lack modern equipment, with lots of inland congestion. We also need some transhipment capability – not that Lekki will be a transhipment hub, but it could act as one in case of need for West Africa. The draft is 16.5m, the phase one capacity is 1.2m twenty-foot equivalent units (TEUs). With our seven ship-to-shore cranes and with the draft allowing bigger boats, we will be able to do 100 moves per hour – which is not incredible by global standards, but light years ahead of what we have at Apapa and Tin Can Island. It will make Lekki a port of the 21st century. It will change the import-export story for Nigeria.

DR

Who is the primary market?

Our goal is to be a gateway, mainly for the Lagos market, plus the wider Nigerian market. Year after year, CGM CMA is putting bigger ships into service for West Africa. We have plans to introduce more ships bigger than 10,000 TEU capacity – there are not so many ports in our network that are able to accept this kind of call.Our colleagues from the shipping side at head office are waiting for us to open the Lekki Terminal as soon as possible.

EKO ATLANTIC CITY PROTECTING THE COAST OF LAGOS AND ADDRESSING REAL ESTATE SHORTAGE Lagos population growth 1960-2030

Permanently protecting Victoria Island and parts of Lekki from flooding

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LED street lighting Smart city, using modern and efficient Green infrastructure

Actively addressing Grade-A real estate shortage in Lagos

Eko Atlantic is bustling today with businesses and residents. The city is providing vital space supported by modern and efficient infrastructure for people to live and work in the heart of Lagos, Nigeria, the world’s fastest-growing megacity.

Addressing the overwhelming demand for Grade-A real estate and creating the new economic capital of West Africa, Eko Atlantic enables all residents and businesses to take advantage of:

Modern and efficient centralized infrastructure Reduced energy and water consumption thanks to green building certification and LED street lighting World-class roads and infrastructure Two marinas and a 10.5 km ocean front promenade IFC EDGE (Excellence in Design for Greater Efficiencies) certified green buildings Safety and security

EKO ATLANTIC CITY YOUR HEADQUARTERS IN AFRICA

Eko Atlantic is designed to provide your business in Nigeria with multiple benefits: Grade-A office space serviced by modern and efficient infrastructure Continuous supply of utility facilities including electricity, water, waste water, fibre optic network for I.T. services Eko Atlantic is a Free Zone

Multiple tax incentives One-stop approvals for permits, operating license and incorporation papers Duty free importation of equipment and materials for construction and fittings Adjacent to the Central Business District of Lagos: Victoria Island and Lekki With key infrastructure already in place and a world-class marina nearing completion, Eko Atlantic offers unprecedented lifestyle and business opportunities.

To learn more, please book a meeting or call

FreeZone@ekoatlantic.com +234-809-784-4448 ekoatlantic.com

CELEBRATING THE 60TH ANNIVERSARY OF NIGERIA’S INDEPENDENCE

INSIGHT NIGERIA/FRANCE / TOTAL MOVER AND SHAKER 1986 BSc (hons) Engineering, University of Aberdeen 1997 Joined Total

TOTAL ENERGIES

2019 Named CEO for TotalEnergies, Nigeria

INTERVIEW

Mike Sangster ‘The demand is huge for power’ TotalEnergies’ CEO for Nigeria speaks about the company’s response to the Covid-19 crisis, the electricity market and the future of gas projects Interview by NICHOLAS NORBROOK in Lagos When Covid-19 hit in March 2020, it came at a difficult time for the oil market. A price war between Russia and Saudi Arabia had pushed prices to the floor in February, when suddenly the pandemic drastically reduced consumption, sparking a worldwide rush to find storage for crude.

“We were concerned about where this pandemic was going,” says Mike Sangster, the CEO for TotalEnergies (formerly Total) in Nigeria. “We managed to get our hands on a few PCR machines [for Covid-19 testing], some of which we used, and two of which we donated to Rivers State. We also donated an oxygen plant to Lagos State.”

Despite the lockdown, thanks to TotalEnergies’s 1,300 staff and many contractors “we didn’t lose a barrel because of the pandemic”, says Sangster. Nigeria was short of revenue, “so we thought it was important to keep government revenue flowing”.

TotalEnergies’ deepwater Egina project began producing oil in 2018 and it is now providing 10% of Nigeria’s total oil production at 200,000 barrels per day. But, while the last three big oil investments in Nigeria came from TotalEnergies, the pipeline for projects going forward is more sparse.

A Wood Mackenzie report shows that, in the past five years, there has been $70bn committed to Africa for upstream projects – and

120 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

only $3bn of that was going to Nigeria. “So there has been a real lack of investment,” says Sangster.

“Companies have been reluctant, partly because of the oil price crash and, since 2019, a lot more concern about what is going to be in the Petroleum Industry Bill.”

TotalEnergies is developing one project at present, Ikike, a “relatively simple” shallow-water project that is a one platform tie-back to an existing facility.

From oil to gas

Part of a national reorientation, gas is also gaining momentum.

Nigeria LNG’s Train 7, backed by TotalEnergies, was approved and signed at the end of 2019. Limited to engineering during the pandemic in 2020, the project’s construction work has now been ramped up.

Sangster notes: “Nigeria is well under way to moving from being an oil country to a gas country.”

In 2020, the company produced 540,000 BOE per day from Nigeria, roughly two-thirds oil and one-third gas. TotalEnergies will continue to develop gas reserves to feed the LNG plant, the capacity of which Sangster predicts will go up 35% to 30m tonnes per annum.

While TotalEnergies wants to become a broad energy company and grow its electricity business, there is some way to go in Nigeria.

“The demand is huge for power – you can hear how many generators are running – but the power market is challenging the moment,” says Sangster. “The companies are facing severe financial issues, there is a lack of infrastructure to get the power from the power stations to the market, and regular payment by all end users is not guaranteed.”

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INSIGHT NIGERIA/FRANCE /

ADETONA OMOKANYE/BLOOMBERG VIA GETTY IMAGES

Nigeria’s currency is weaker due to Covid and low oil prices

CURRENCY

Devaluation nation The government has tried to protect the economy from oil-price and Covid-19 shocks by imposing foreignexchange controls and limiting drops in the naira’s value

By DAVID WHITEHOUSE Nigeria’s naira devaluation in May won’t be the last and will not fix the country’s dollar shortage. In May, the central bank merged the official fixed rate of N379 ($0.92) per USD with the investors and exporters exchange rate devaluing the currency by 7.6% against the dollar. Central bank governor Godwin Emefiele says the new unified rate will still work as a managed float.

The naira has lost value over the past decade. The official rate dropped from N157 to the dollar in 2011 to N412 in May this year, losing more value than South Africa’s, Egypt’s, Indonesia’s and Malaysia’s, according to research from FSDH Merchant Bank, Lagos.Analysts say the new rate is unlikely to halt the naira’s long-term depreciation or end

parallel-market dollar trading.

“The foreign-currency shortages and overall policy uncertainty can only lead to more speculative activity in the parallel market, which unfortunately leads to more losers than winners,” says Barbara Barungi, an economist in Abuja.

“The harsh reality is that there are likely to be more adjustments needed,” says Ibrahim Shelleng at Credent Investment Managers, Abuja. “The continued pressure on scarce forex will more than likely lead to further adjustment.”Exporters, in theory, should benefit from a devaluation. Yet Shelling sees

N412

That would buy you $1 in May at the central bank’s official rate. N157 would get you a dollar back in 2011.

122 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

those benefits as being limited by a high cost of finance for Nigerian companies. The manufacturing sector, which relies heavily on machinery and raw material imports, will be hardest hit by the devaluation, Shelling says.

“The construction and real estate industry will also take a big hit.”

Again and again

“The central bank is likely to devalue the naira again later in the year as depreciation pressures continue to build and foreign reserves remain under pressure, says William Attwell, a sub-Saharan Africa analyst at Fitch Solutions. He does not expect to see any significant improvement in dollar availability soon.

He predicts that the naira will end the year at N438 to the dollar and says any move to a free float is “highly unlikely.” FSDH is more optimistic. The May devaluation was “a first and major step towards gaining back investor’s confidence in the economy, which in turn could improve forex inflows into the economy,” it says. Demand from imports and other payments will continue to put pressure on the rate.

Nigeria needs “consistent forex policies that seek to improve market liquidity and prevent every form of forex arbitrage and unnecessary forex subsidies.” The difference between official and parallel rates has given speculators incentives to hoard and create volatility, says Shelleng. This, he argues, discourages foreign investors from bringing in much-needed liquidity.

A solution is to reduce speculative incentives. This would require “a very brave government”, says Shelleng. “The potential impact on the economy may be devastating in the short term. Still, that political courage will need to be found at some point. Maintaining a fixed rate is simply delaying the inevitable,” Shelleng says.

INSIGHT NIGERIA/FRANCE /

INTERVIEW

Bruno Le Maire ‘Support for African SMEs is essential’ France’s economy minister talks about the country’s support for African economies as they deal with Covid-19 and debt burdens Interview by ALAIN FAUJAS Bruno Le Maire, France’s economy minister for the past four years, has said little about Africa and France’s ties with the continent until now.

But behind the scenes he has vigorously applied President Emmanuel Macron’s policies in support of African economies hit hard by the effects of Covid-19.

How can France help Africa rebound from the Covid-19 crisis?

BRUNO LE MAIRE: I have great faith in the vitality of African economies and entrepreneurs. Like all continents, Africa has been hit hard. The impact of this crisis on value chains, such as trade and tourism, has been significant. But let us remain positive: the IMF estimates that in 2021 its average growth rate will be around 3.5% - a good sign.We have a collective THE BUSINESS POLITICIAN

VINCENT FOURNIER FOR JA

1969 Born in Neuilly-sur-Seine 2006 Chief of Staff to the Prime Minister 2017 Minister of the Economy and Finances

124 THEAFRICAREPORT

responsibility to give Africans the means to accelerate their development. Their investment needs are estimated at $350bn over three years. President Macron has been personally involved in convincing the G7, G20 and IMF member states to provide unprecedented financial support to the continent.

What are the solutions on the table?

There are three: direct financing, the fight against excessive debt and support for SMEs. First, more direct financial aid can be provided through the IMF; France fought to increase the fund’s special drawing rights (SDRs). We are therefore pleased that the G20 members have agreed to a general allocation of SDRs, amounting to $650bn.

With this historic amount, Africa will receive about $34bn in SDRs, including $24bn for Sub-Saharan Africa alone. We need to reallocate these SDRs to the poorest countries, to help them cope with the crisis and invest in health, education and the environment.

Second, to fight against excessive debt we have suspended the short-term debt of thirty African countries until the end of 2021, in order to lighten the burden and give them cash. This will allow these states to support their health systems and invest to boost their economies. We also need to transition to the implementation of the ‘Common Framework.’ This framework, which aims to structurally address the debt problems of countries with struggling economies, brings together the Paris Club creditors and – for the first time ever - emerging creditors (China, India, Saudi Arabia). We have already received requests from Ethiopia, Chad and Zambia.

Third, support for African SMEs is essential, and shows the greatest promise.

With the Agence Française de Développement, we launched a project in 2019 for 16,000 SMEs, for which we have made available $3bn. Despite the Covid-19 pandemic, in 2020 we made the decision to increase this fund by a further €1bn.

Plot 1415 Adetokunbo Ademola Street, Victoria Island, Lagos, Nigeria

INSIGHT NIGERIA/FRANCE /

INTERVIEW

Tayo Oviosu PAGA

‘We want to solve the problems in big places’

CASH DIGITALISER 1977 Born in Lagos 2005-2008 Worked for Cisco Systems, US 2008 VP of Travant Capital Partners, Nigeria

The CEO of Nigeria’s Paga talks to The Africa Report about bringing financial services to the masses in Africa and beyond Interview by 'TOFE AYENI in Lagos Paga founder Tayo Oviosu’s aim is an ambitious one: to “build the Paypal for Africa”. He tells The Africa Report, over a Zoom chat from Lagos, that this would ultimately “digitise cash and really end the use of cash across our economy, as well as increase access to financial services.”

Paga - which was created in 2009 and started operations in 2012 – is already one of Nigeria’s leading mobile-payments companies. It is backed by investors such as Jim O’Neill, a former chairman of Goldman Sachs Asset Management, and Tim Draper, a venture capitalist.

Oviosu says he was ahead of the curve in Africa, noting that when he started the company in 2009, it was with a team of eight and “for everybody in that room, a cashless society was a scary thought.”

In Nigeria, where Paga started, and still has its main base of operations, Oviosu admits that “cash is very much still a thing”, due in part to the fact that “banking services are still very challenging, even for

those who are banked.” Oviosu says the company is “growing at a really fast pace as we continue to deepen our business within Nigeria. […] Paga has over 17 million unique users, and in the last four years has processed $8bn worth of transactions.”

Market woman

He stresses that reaching the potential market requires different strategies. Many Nigerians may not be tech savvy, have a smartphone or trust banks, so “for the mass market, you can go to agents if you don’t want or know how to use the technology. You still deal in cash, but the agent can do the digital.

“One of my main focuses when starting the company was, how do I get the market woman in Ajegunle

‘WE WANT TO FOCUS ON HELPING THE EMERGING MIDDLE CLASS TO PAY AND GET PAID ’

126 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

2009 Founded Paga

to use this,” he says. “Our ambition is that one billion people should use this platform to access and use money. We want to particularly focus on the emerging middle class – helping them to pay, and helping them to get paid.”

Paga is also going to launch a new platform specifically for small to medium-sized enterprises (SMEs) that struggle to sell efficiently, lacking systems for tracking inventory and primarily trading in cash.

Paga, in partnership with Visa, wants to help SMEs to manage their internal operations such as paying salaries and vendors. He is considering expanding to Ethiopia and Mexico, although “in Mexico, we’re pausing to think whether or not to move forward”, he says.

“We want to solve the problems in big places – Africa and Latin America. We will go to neighbouring countries in Africa, but our next country is Ethiopia. We’re waiting for regulatory approvals currently, and are now working to prioritise the other African countries we aim for. But the way we go to various countries will differ.”

INTERVIEW

Kingsley Moghalu ‘There’s absolutely shambolic economic management’ The former deputy governor of the central bank of Nigeria is running for the presidency on a radical platform without the backing of the main parties Interview by DONU KOGBARA and PATRICK SMITH ‘Build, innovate and grow’ was the manifesto of Kingsley Moghalu and his Young Progressives Party in the 2019 election, where he gained all of 20,000 votes. He is endorsed by Nobel laureate Wole Soyinka, former CBN governor Sanusi Lamido Sanusi and the Ooni of Ife, Adeyeye Ogunwusi, and is trying again in 2023.

What makes the security crisis in Nigeria different this time?

KINGSLEY MOGHALU: We’re at a decisive moment in Nigeria’s history. Many countries experience low-level insurgencies, and Nigeria has had Boko Haram for the past 12 years. What is different now is the combination of the terrorism crisis metastasising

AIMING FOR THE TOP 1963 Born in Lagos

ALL RIGHTS RESERVED

1992-2008 Worked for the UN and the WHO 2009-2014 Deputy governor of the CBN 2019 Presidential candidate of the YPP

across the whole country and combining itself with economic collapse. You have a third element : the legitimacy of the Nigerian state is increasingly questioned. Many Nigerians consider the idea of being Nigerian or the idea of Nigeria as meaningless to their lives. There’s a lack of vision from the current government,

absence of leadership, a lot of corruption in the armed forces and mixed loyalties […] that all prevent an effective conclusion of the war against Boko Haram. The political leadership is driven by a worldview that is just very narrow, very ethnic, clannish.

Are the economic woes just about management or are they systemic?

There’s absolutely shambolic economic management because leadership is not competent enough to understand how to create prosperity. Then there’s the fundamental issue – the constitutional structure of the country that creates incentives for economic and political dysfunction. They concentrate power at the central government level so much, that combined with the reliance on oil, it’s simply become a rentier economy.

Would your plans for constitutional change be divisive because only the southern states want it?

The conversation is shifting. In the beginning, the northern political elite was wary about constitutional restructuring. Increasingly, they have embraced it. Everyone in Nigeria now wants the constitutional basis of Nigeria re-engineered. We should create a new constitution, with a constituent assembly, a new federal system based along regional lines. It will create an incentive for prosperity. There is no region in Nigeria which cannot become self-sustaining economically. It is the present system that continues to create the incentive for poverty.

You are running for the presidency without backing from any of the big parties – isn’t this doomed to failure?

Things seem impossible until they happen, as Nelson Mandela said.

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ENERGY DOSSIER

A major energy transition

The global energy companies’ shift towards greener sources of power comes as a blow for oil-rich African countries. What’s good for the goose is not good for the gander

128 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

By PIERRE-OLIVIER ROUAUD On the continent, Total, Shell and Eni are prioritising their gas developments. But their projects in renewable energies and carbon offsetting are still modest. This focus on gas is good news for some environmentalists, but bad news for African oil-producing countries that

BP

Senegal’s Grand Tortue Ahmeyim LNG project

benefit from the tax revenue and jobs that come from oil.

Under pressure from public opinion and Western regulators, but also from their shareholders and financial partners, the oil sector’s majors, and especially the European ones – Shell, BP, Total and Eni – have begun an unprecedented change: their voluntary

and gradual withdrawal from the extraction of crude oil in favour of ‘greener’ energies. Shell’s CEO Ben van Beurden has said that the Dutch-British group’s oil production peaked in 2019 and is now declining by 1% to 2% per year.

The stated goal of many oil majors, supported by the European Union and the United Kingdom, is

‘carbon neutrality’ by 2050. The European majors have no legal obligations at this stage, but they have set this target for all their activities, including the final use of the fuels they sell – which is by far the most important factor in carbon emissions. For example, Total’s direct emissions amount to about 45m tonnes of CO2 equivalent, but

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129

ENERGY / A major energy transition

SHARE OF INSTALLED RENEWABLE AND FOSSIL FUEL GENERATION CAPACITY IN AFRICA BY REGION IN 2019 Bubble size based on total installed capacity in the respective region Renewable energy Fossil fuels & nuclear

107,928 MW

No appetite for new projects

48,289 35,754 22,668

Natural gas

Coal

Hydropower

7,234

5,753

Solar

Wind

Diesel & fuel oil

transition is that developments will slow down. Jonathan Evans, BP’s director of new African projects, stated during Africa Oil Week, at the end of 2020, that, due to the carbon-emission constraints, BP will launch very few oil extraction projects on the continent.

This trend is all the more pronounced since the majors’ Western financial partners are now more reluctant to invest in large extractive projects. Barclays and Credit Suisse have announced that they will cease financing the East African Crude Oil Pipeline in Uganda and Tanzania, which would

PRIMARY ENERGY DEMAND IN AFRICA Renewables Coal

Natural gas Biomass

Oil

2% 16% 45%

SOURCE: IEA

Half of Africa’s oil production is exported. However, when it comes to energy, the priority for Africa’s governments is first and foremost to improve access to it for their populations: 600 million people still lack electricity, and the massive use of biomass has devastating effects on health and the environment.

The road to energy transition for the European majors will be long. A small consolation for their managers is that the US giants Exxon and Chevron – which are both less present on the continent than the Europeans and less convinced of the risks linked to climate change – and the Chinese companies CNOOC and Sinopec are much further behind.

For the African national oil companies, energy transition is not their concern: their goal is to optimise the exploitation of hydrocarbon resources, of which they hold a large part of the continent’s reserves. Energy transition is a Western concept designed to solve a Western problem.

The African deposits that have already been exploited should easily find investors, even if they are no longer led by the majors. In Nigeria, for example, Shell, Total and Eni recently sold 45% of the offshore OML 17 field to billionaire Tony Elumelu for $1.1bn.

The risk for African countries from the sudden focus on energy

130 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

23% 13%

1,940

1,626

Nuclear

Bioenergy Geothermal

830

have allowed Total and CNOOC to develop their Lake Albert fields.

“Development agencies and even multilateral donors are increasingly reluctant to finance fossil-fuel projects, even gas,” says Stéphane His, senior consultant at the French research firm Enerdata.

Green and mean

The policy is not to everyone’s taste. Cameroonian lawyer NJ Ayuk, president of the African Energy Chamber, denounces the “demonisation” of the sector and the “anti-African” attitude of Western governments and environmental organisations like Greenpeace. An example of their influence is the recent decision of the British government’s foreign credit agency UK Export Finance (UKEF) to no longer support gas projects in Mozambique.

In this context, how are the European majors reducing their carbon footprints in Africa? In addition to ‘operational efficiency’ (reducing methane leaks from wells or ending flaring and optimising well drilling), their plans are based

SOURCE: IRENA

the group estimates those related to vehicle fuel at 450m tonnes.

In the global negotiations on CO2 emissions, the continent is more of a spectator than a player. It generates 9% of the world’s liquid petroleum (oil) production (7.2m barrels per day) and 6% of natural gas production. But it remains a modest emitter of greenhouse gases: with 17% of the world’s population, Africa accounts for only 2% of emissions.

SAIPEM

Egypt’s Zohr giant offshore gas field

around three strategies: gas, renewables, and nature-based carbonoffset projects.

On the continent, if the majors are backing off from oil, they are pushing hard for gas with tens of billions of dollars in projects.

“On a global level, the majors are switching over. Most of them already derive half of their revenue from gas,” says His. The reason is well-known: coal was used for 37% of the world’s electricity generation in 2019. Replacing it with gas would cut global CO2 emissions in half.

It’s a gas, gas, gas!

Gas is the ‘transitional energy’ touted by Patrick Pouyanné, Total’s CEO. This vision is strongly contested by environmental NGOs, which point out that gas production is still polluting, that it emits CO2 and that it is not a renewable energy.

On the continent, while continuing to work in countries with a long experience in the gas sector, such as Algeria, the majors have established themselves in new production countries where major discoveries have been made.

$55bn

Combined planned investment in Mozambique’s three gas megaprojects: Mozambique LNG, Rovuma and Coral

In Egypt, Eni has changed the country’s energy landscape with the giant Zohr field.

Mozambique has three gas mega­ projects totalling more than $55bn in planned investments. But the largest of these, Mozambique LNG, was suspended by Total following the attack on the nearby town of Palma at the end of March. The second project on the list, Rovuma LNG, led by Eni with the support of ExxonMobil, is still awaiting the final go-ahead.

In West Africa, Shell (25%) and Total (15%) are leading a $4bn investment in a seventh LNG processing unit on Nigeria’s Bonny Island with the semi-public group NLNG. In Senegal and Mauritania, the offshore Grand Tortue Ahmeyim (GTA) field, led by BP in partnership with the explorer

Kosmos, is expected to produce its first gas in 2023 and to boost the economies of those two countries.

Finally, in Angola, Chevron, Eni (operator), Total and BP, together with Sonangol, are currently developing a $12bn integrated liquefied natural gas (LNG) project in Soyo.

While the gas equation relies mainly on exports to developed countries or major emerging markets (such as China), the good news for Africa is that it can benefit local electrification projects.

This is the case in Mozambique and Senegal with the GTA project, which is intended to supply several power plants. In Ghana, Shell has just invested in the Tema LNG terminal, which will make the country the very first south of the Sahara to import LNG. Total expects to do the same in Côte d’Ivoire and Benin. In Angola, the future Soyo terminal will supply a 750MW power plant. For the governments of these countries, the preoccupations of Western companies with reducing their carbon footprint could not be further from their minds.

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ENERGY DOSSIER

ENVIRONMENT

rivers, is expected to create a forest environment more resistant to bush fires, and to increase biodiversity. The project, which is fully financed by Total – around $230m over the life of the project – includes agroforestry crops developed with local populations for sustainable agricultural and wood energy production.

By 2040, the responsible management of the forest using planted trees should enable the natural regeneration of local species and the supply of sawn timber and plywood to the Republic of Congo and its neighbour the DRC.

Green shoots To meet their goal of becoming carbon neutral by 2050, energy companies are backing largescale reforestation projects, like Total’s in the Republic of Congo

By CHRISTOPHE LE BEC Besides focusing on gas and renewables, the world’s major energy companies are also working on ‘negative CO2 impact’ solutions to offset the emissions resulting from their activities. In Africa, their efforts are focused on forestry projects, particularly within the UN’s REDD+ framework (Reducing Emissions from Deforestation in Developing countries). This initiative relies on a strict methodology and independent certifiers such as the US organisation Verra.

Total has set up a subsidiary, Nature Based Solutions, dedicated to environmental projects. With a

budget of $100m per year starting in 2020, it aims to capture 5m tonnes of CO2 per year by 2030.

With the specialised French consultancy Forêt Ressources Management (FRM), Total has signed a partnership with the Republic of Congo to plant a new 40,000 hectare forest on the Batéké Plateau.

This forest is intended to be a ‘carbon sink’, accumulating and storing around 13m tonnes of CO2 over 20 years and thereby lowering its concentration in the atmosphere. The planting of acacia trees on this sandy plateau some 200km north of the country’s capital, near the Lefini and Congo

Local sustainability

FNC

Acacia seedlings for the Batéké forest project

132 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

According to Nicolas Terraz, head of Total E&P Sub-Saharan Africa, this is the first project of its kind on the continent for the French group, which is aiming for carbon neutrality by 2050. Its environmental performance will be certified by independent auditors under Verra’s Verified Carbon Standard and its Climate, Community & Biodiversity standards.

“We want to develop these projects alongside recognised partners, such as FRM, from whom we have a lot to learn, and in dialogue with local communities, in order to anchor our commitment over time and contribute to local development,” said Adrien Henry, vice-president of Total’s Nature Based Solutions, at the announcement of the project’s launch on 16 March of this year.

British-Dutch firm Shell is developing its largest projects in Asia – in Indonesia, in particular – and is involved in reforestation projects in Ghana and Kenya. Meanwhile, Italy’s Eni is supporting the REDD+ Luangwa Community Forests Project in Zambia, which aims to capture 1.5m tonnes of CO2. The group promises other partnerships in Mozambique, Ghana, Congo, DRC and Angola.

A GAS STRATEGY IN AFRICA For over two decades Perenco, has been a significant producer of natural gas.

Today, gas accounts for one third of Perenco’s overall poduction.

The gas produced by Perenco is making a meaningful contribution across the African continent.

It is generating electricity to power developing industrial economies and to enable manufacturing, whilst also being used in millions of homes, providing a clean and reliable form of energy for cooking and heating and, increasingly, as a low emission transport fuel.

THE INTERNATIONAL LEADING OIL AND GAS COMPANY Perenco is active in five African countries (Cameroon, Congo, DRC, Gabon, and Tunisia), as well as in Northern Europe, Latin America and South East Asia.

Founded in 1975 by Hubert Perrodo, Perenco has expanded steadily through acquisitions, drilling and production enhancement. With a focus on mature and marginal fields, Perenco now produces 465,000 boepd and employs over 6,000 people globally.

ADVERTORIAL

MAKING A LASTING CONTRIBUTION Through its sustainable business model Perenco continues to make a positive contribution in its partner countries, to listen to their needs, and to form part of the energy solution. In Gabon, Perenco has been the country’s only commercial gas provider since 2006 producing 50mmscfd which meets the gas needs of the thermal power stations of Port-Gentil and Libreville. In Tunisia, the Company has cumulative production of over 30 mmscfd for electricity generation and Liquefied Natural Gas (LNG).

In Cameroon, production of 30 mmscfd generated 250 MW of power at Kribi, and will allow the industrial development of the area.

In Cameroon, Perenco has also successfully delivered the installation and operation of the first floating LNG plant, which has had a material and positive impact for Cameroon, producing 30,000 tonnes of domestic gas and reducing the country’s import bill by 40%.

In the DRC, 3MW are provided to Muanda thanks to natural gas.

INVESTING IN THE FUTURE Perenco is making a local resource available, in order to support growth and development in the countries in which it operates.

Perenco works hand in hand with these nations to balance their energy and economic development needs with their energy transition goals.The Group continues to work on a number of innovative gas projects in each of the countries where it operates, including: gas-supply projects for thermal power plants that generate electricity, the development of local industries, as well as domestic gas production and the conversion of company cars to CNG. Whenever possible, these projects are completed by the production of LNG.

ENERGY DOSSIER

Essakane gold mine in Burkina Faso (15MWp). Shell is virtually absent from Africa as a project leader in renewables, as is BP, despite its 2018 partnership with Egypt’s Hassan Allam Utilities.

LAURENT ZYLBERMAN/GRAPHIX IMAGES/TOTAL

Total’s Prieska solar park in South Africa

GREEN ENERGY

Oil majors are slow on solar and wind Administrative hurdles, poor infrastructure and the necessity for small-scale projects are all deterrents to the big players. That’s where partnerships come in

By PIERRE-OLIVIER ROUAUD The oil majors are touting their global ambitions for renewable energy. France’s Total plans to invest $60bn in the sector within the next 10 years and is targeting 100GW of capacity on a global scale – that is 322 times the installed capacity of Africa’s largest wind farm at Kenya’s Lake Turkana. BP is targeting 30GW by the same date, while Shell has pledged to invest an annual $2bn-$3bn worldwide.

But, for the moment, the investment of the majors in renewables on the continent remains small. While Eni is promising solar projects in Egypt and Angola (Solenova, a joint project with Sonangol), it currently only has small photovoltaic plants in Tunisia, Algeria and Angola with less than 40MWp each in capacity.

Total operates in the solar sector through various subsidiaries, including Total Eren and the US company SunPower, which has developed the South African Prieska plant (86MWp).

After Uganda in 2016 (10MWp in Soroti), Total Eren commissioned a 126MWp photovoltaic park near Aswan in Egypt in mid-2019. The group has also signed a contract with Greentech to build a 35MWp solar plant in Angola, and has developed industry-focused projects such as the IAMGOLD

2030

Date on which Kenya’s Lake Turkana Wind Power Project is due to reach its full capacity of 310 MW.

134 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

Risks and red tape

“The majors take a global approach to carbon-emissions reduction and are focusing their transition efforts on developed and large emerging countries. Because of the structure of these economies and their energy mix, the impact is more rapid and massive than it would be in Africa,” says Francis Perrin, associate researcher at the Policy Center for the New South in Rabat.

A lack of will, or is it something else? The time it takes to set up projects in Africa and the poor electricity networks are obvious deterrents. In addition, there is the risk of cyclones to wind power in tropical areas, the lack of legislative frameworks in many countries, and ambiguity over land rights, which has proved a problem in Kenya.

Oil companies accustomed to mega-projects are ill-equipped to handle a multiplicity of small projects, microgrids or M-Kopastyle solar energy. “The future of electrification in Africa depends in part on decentralised renewable production. But the majors still have very little presence in this niche,” says Stéphane His of the Enerdata consultancy.

To speed things up, many of the companies are looking for partnerships. Through its foundation, Shell has provided $45m to a micro-electrification initiative supported by the US International Development Finance Corporation.

In 2019, Shell and Japan’s Sumitomo bought a 15% stake in Powergen, a Kenyan microgrid developer. And Total has created Total Access To Energy Solutions (TATES) to develop pilot projects and support start-ups in East Africa.

ADVERTORIAL

Herbert Smith Freehills LLP

EXPERT ADVICE

66 avenue Marceau 75008 Paris - France Standard : + 33 1 53 57 70 70 rebecca.major@hsf.com

www.hsf.com

Green Energy in Africa: Accelerating energy transitions across the continent International investors need to reduce their carbon footprint globally and are being pushed by market forces, legislators, courts and shareholders to do so.

in order to protect the African economic environment with a healthy level of exports, and the social and economic domestic environment with an energy progression.

Africa needs an «energy progression» as well as an «energy transition». In many parts of the African continent, it is not a question of changing the way electricity or transport networks are used, but a question of making reliable electricity supplies and transport networks available for the first time. Africa’s natural resources also need to be used to provide revenue for African citizens.

There will be enormous investments in Europe in these areas in the next few years, by private companies, national governments and the European Union. African governments and African businesses need to position themselves now to capture some of these investments and encourage sustainable investment in the African energy sector going forward.

We think that the African continent can use the global «green business revolution» to its advantage.

African governments and legislators can harness this green revolution to facilitate access to electricity for African populations and encourage exports that suit the needs of international investors. The challenge will be to find a happy balance

Some international companies are seeing Africa as a good testing ground for innovative technologies and business models. For example, we are seeing investments and potential investments from Europe (and elsewhere) into off-grid solar, battery storage, improved hydroelectric technology and various uses of blue and green hydrogen. Africa could become an attractive place for using

Rebecca Major, Partner, Head of Energy and Natural Resources, Paris

technologies such as hydrogen and renewable sources to make existing and new natural resources projects greener and therefore more marketable in the future. We have been talking to our clients about greener mines, greener gas and LNG production, greener ammonia production and greener refining and beneficiation processes generally in Africa.

We hope to see African policy and legislation continue to evolve to take account of this game-changing revolution and look forward to continuing to advise international investors and governments on these exciting challenges.

AGRIBUSINESS DOSSIER

Kenya’ s hot cuppa

climate change

136 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

The optimum tea-growing areas in Kenya’s Rift Valley are shrinking

Activists and farmers warn that the sector needs to act fast before changes in temperature and weather patterns hit the leading black tea producer’s production hard

SVEN TORFINN/PANOS/REA

By VICTOR AMDALA in Kericho “Twenty years ago, a visitor to Kericho would gladly ask for an extra blanket and not a swimming pool – especially at 6pm,” a guard at the Sunshine Hotel told me when I enquired about the possibility of taking a dip. Rolling a black button in his right hand, he laughed nervously for few seconds before launching into a lesson on the climatic history of the region: “I was born not far from here 62 years ago. The region was three times greener. Forests were thicker; you could barely see beyond two kilometres.

Rain and cold was part of our lives. […] Now we have prolonged dry seasons and diminishing forest cover.”

It may have been a roundabout way of saying that the hotel didn’t have its own pool, but the man had given me a first-hand account of the changes affecting both smallholder tea farmers and multinationals in Kenya’s Rift Valley.

A recent study on the effects of climate change on the tea sector in Kenya by British charity Christian Aid confirms that the sector is facing a host of climate-related problems including rising temperatures, erratic rainfall, droughts and insect infestations. The authors forecast that by 2050 the rapid climate shifts will slash Kenya’s optimal tea-growing area by 26%. Mediumquality growing areas could also shrink by 39% in the next 30 years.

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AGRIBUSINESS DOSSIER / Kenya’s hot cuppa climate change

Kenya is highly vulnerable to climate change, with projections suggesting that its average annual temperature could rise by up to 2.5°C between 2000 and 2050.

Going forward, rainfall will become more intense and less predictable. ‘Even the slightest increase in droughts will present major challenges for food security and water availability,’ the Christian Aid report warns.

“Our plantation is on 7,000ha. We have maintained the forest cover within our area of operation.

James Finlay takes responsibility for any tree felled within [that area],” Kirui says.

The largest plantation in the region, covering well over 10,000ha, belongs to Unilever Kenya, which has been working on reducing its carbon footprint.

In 2018, Unilever East Africa partnered with fair-trade waste-management company Mr. Green Africa for a ‘U-Turn waste project’, creating a circular economy for its packaging materials by providing an end use for the recycled plastics.

session organised by James Finlay Kenya, which employs 7,000 people on its tea farms in Kericho.

Sammy Kirui, the corporate affairs manager at James Finlay, explains: “We plant at least 3,000 trees known for their waterconserving power around potential water sources. The company has noted unchecked dilapidation of indigenous Mau West Forest cover, which has been the source of rains that sustain multinational tea firms and smallholder farmers.”

The company’s approach combines precision agriculture, the use of biological energy in production and community involvement in conservation of forest cover.

Clean cookstoves

TEA PRODUCTION IN KENYA (in 1,000tn)

600

570.5

500

493

472

458.8

439.8

400

399.2 300 2015

138 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

2016

2017

2018

2019

2020

SOURCE: KENYA NATIONAL BUREAU OF STATISTICS

Another recent study, carried out by the United Nations Food and Agricultural Organisation for the Swedish International Development Cooperation Agency, surveyed 700 growers in Kenya’s seven major tea-growing regions.

At least 40% of respondents said they had noticed changes in rainy and dry seasons, which had led to shifts in the planting season, while 35% cited drought.

These trends are worrying tea farmers. Some are considering uprooting the crop for short term alternatives such as maize, beans, potatoes and vegetables. Others are determined to keep growing tea, and are taking cues from large plantations that already have mitigation measures in place.

Ezekiel Kibet, one of 10,000 smallholder farmers working with the firm James Finlay in Kericho, told The Africa Report that he had cut all the eucalyptus trees down and planted indigenous trees across his fragmented four-hectare tea farm in Kipsolo village.

“There has been a slight decline in tea production due to erratic rainfall in this region. I have been growing tea for the past 40 years.

The negative change in production which I have experienced in [the] past decade is a result of prolonged dry [weather],” Kibet said. Apart from tending to his own production, he religiously takes part in the community tree-planting

TONY KARUMBA / AFP

Trees conserve water

Smallholders produce almost 60% of Kenya’s tea

More locally, the firm has supported the provision of ‘clean’ wood-burning cookstoves to tea-growing communities. The stoves are designed to replace the traditional smoky open fires, which cause air pollution and can lead to respiratory diseases. In addition, the tea processing plant in Kericho is now powered by a 619kWp solar park in partnership with CrossBoundary Energy, an investment fund that finances off-grid projects for companies.

The irony of rich nations’ profligacy affecting the very people who grow their basic foodstuffs is not lost on Unilever. In its 2019 sustainability report it said: ‘There has been an astronomical change in climatic patterns, not just in Kenya’s Rift Valley but everywhere in the world. While Africa is producing less carbon, the continent is highly impacted.’

Tailored support

The UK-based firm Twinings Tea, which works with smallholder farmers globally, including Kenya, calls its sustainability programme Sourced with Care.

In addition to reducing its own carbon emissions with the target of being carbon neutral by 2030, it develops ‘tailored interventions’

in tea-­growing communities by listening to the growers themselves.

Training on sustainable agricultural practices, women’s empowerment programmes and support for additional income-­generating activities all increase farmers’ resilience in the face of climate change.

According to Twinings Tea’s 2021 social impact report, Sourced with Care has reached up to 8,000 smallholder farmers in Kenya, and several tea centres have received international quality certification.

Some are considering uprooting the tea crop for short-term alternatives like maize

While the fact that large and multinational companies are taking social and environmental responsibility seriously can only be a good thing, local traders and environmental experts argue that the government must improve its environmental conservation policies.

Philip Rono, chairperson of Fintea Growers Cooperative Union, representing five cooperatives in Kericho and Bomet counties, says the state should come up with incentives or better policies to complement what farmers and multinationals are doing. “It makes no sense for multinationals to invest resources conserving the environment only for another firm to release its waste in water[ways] and go unpunished or [be] handled with baby gloves,” Rono says.

PERFORMANCE

Africa – Fertile ground for the future of food security It seems ironic that the world is pinning its food security hopes on a continent better known for famines and feeding schemes than for the abundance of fresh and nutritious produce. Yet, with around 25% of the world’s arable land, some say Africa has the potential to contribute to global food security. OCP Africa is set on growing that potential by literally working from the ground up and is playing a fundamental role in the transition of Africa’s farmers from subsistence farming to value-creating agriculture.

OCP Africa Extension Agent , Agripromoter programme.

Mobile soil Laboratory, OCP School Lab.

O

n a long, dusty road in Kaduna State in north-western Nigeria, a bright green three-wheeler motorcycle, mounted with a square cargo box, buzzes along before turning off onto a track leading to a small settlement of modest houses and flourishing fields. This is an OCP Africa Extension Agent from the Agripromoter programme, just one of the programmes specially designed and run by OCP Africa to contribute to developing Africa’s integrated agricultural ecosystems.

A subsidiary of OCP Group, the world’s largest phosphate mining and leading fertilizer company, OCP Africa has been on the ground and in the field for five years, gaining invaluable insights into smallholder farmers’ evolving needs while sharing lessons learned, strengthening cooperation, creating partnerships and developing solutions. It is well-positioned to provide advice, support, “best practices” and innovative agriculture through new technologies, thereby playing a role in achieving a green revolution in Africa, which goes way beyond its core business of supplying suitable fertilizers.

R&D is a strong component of OCP Africa’s sustainable agricultural development, integrated soil fer-

tility management and climate change approach.

It provides fertility mapping and soil analyses and develops new customised formulas adapted to specific soils and crops.

Large-scale programmes for small-scale farmers Africa’s smallholder farmers are the backbone of its agricultural sector and the focus of OCP Africa’s projects and programmes which, since 2016, have benefited over a million farmers. With its African roots, tremendous agronomic knowledge, experience and agri-tech developments, OCP Africa’s large-scale programmes set out to impact not only the smallholder farmer but the entire value chain, with the aim of increasing yields and incomes. OCP Africa’s action is supporting small farmers through a wide range of partnerships, services and capacity building programmes to optimise their land’s potential so that they can thrive, favouring the development of ecosystems that lead to innovative financing, insurance and markets, thereby securing farming activities and building the foundations for a sustainable future.

MESSAGE

OCP Africa developed Agribooster, an inclusive development model that provides farmers with support at every step of the agricultural value chain. Agribooster focuses on the urgent need for African smallholder farmers to improve their productivity and yields, locate buyers and markets and access financial services, including loans.

Through the Agribooster package, OCP Africa has so far provided around 630,000 farmers in four countries with access to quality products and inputs (fertilizers, plant protection products, hybrid seeds), technical and business training sessions, access to potential buyers on the market, personal support, and access to financial services (including loans).

Farmer House is a comprehensive last-mile distribution solution rolled out in Nigeria to address the availability and accessibility of agricultural inputs by bringing together all basic agricultural inputs, Good Agricultural Practices (GAP) training and extension services under one roof in proximity to smallholder farmers in rural communities. Each Farmer House is equipped with a classroom, a storage room, office space, a borehole well, one or more three-wheeler motorcycles, a digital soil analysis laboratory, a greenhouse, and a smart fertilizer blender, amongst others.

To reach smallholder farmers in their communities, each Farmer House employs one or more Agripromoters. These are OCP Africa extension agents, all equipped with a three-wheeler motorcycle mounted with a cargo box and a tablet that deliver agricultural inputs and training to farmers.

In the past five years, OCP Africa’s holistic, end-toend ecosystem and farmer-centric approach has empowered and improved the lives of African smallholder farmers. This was achieved under the strong conviction that Africa can become a world leader in sustainable farming and help feed its growing population and ultimately the world.

Good Agricultural Practices (GAP) training , Farmer House.

OCP AFRICA STRIVES TO: Improve the fertility and productivity of African soils through appropriate products.

Secure the production of competitive fertilizers near the largest farming areas.

Contribute to the development of new local distribution networks, serving the entire agricultural sector.

Improve farmers’ access to quality inputs, financing, markets, training and technology.

OCP School Lab +420 K African farmers trained in 9 countries Agribooster: 630 K farmers supported in 4 countries, >30% yield increase on average Farmer House: 29,250 smallholder farmers supported through 51 outlets in 18 states in Nigeria Agripromoter: 7K smallholder farmers supplied and trained in Nigeria, 40K jobs to be created by 2040

JAMG © D.R.

OCP Africa’s School Lab, one of the most innovative programmes, raises awareness about the importance of soil testing. A mobile soil laboratory travels to meet farmers where they are and, using the latest innovations (X-rays, big data, and machine learning) and real-time information on soil needs, helps them test their soil then makes free fertilizer application recommendations specifically for their soil and crop mix. School Lab also provides interactive training sessions with live demos on Good Agricultural Practices (GAP) and animated videos for higher impact. To date, School Lab has already helped over 420,000 African smallholder farmers across nine countries.

AGRIBUSINESS DOSSIER

EGYPT

Fresh orange exports are squeezing out other citrus crops Producers say that the sector needs more diversification and processing in order to grow and protect farmers when there are major price swings

By SHERIF TAREK in Cairo Having leapfrogged Spain, Egypt is steadily edging closer to achieving its full potential as the world’s top orange exporter. But that may eclipse opportunities to diversify into other high-quality citrus crops.

Since the 1980s, agricultural producers have increasingly channelled their resources into improving orange production, while pushing for the opening of new markets. Brazil and Japan have been added as export destinations in recent months. Oranges account for approximately 80% of Egypt’s total cultivated citrus area today, and according to official data, made up more than 86% of exported citrus fruit in the 2020/2021 season (December 2020 to 30 April 2021).

at exporting company, the Egyptian Growers Organisation.

Hesham El-Naggar, CEO of the fresh fruit and vegetable producer Daltex, says that citrus exports will witness no more quantum leaps, only climbing marginally in the coming years, before plateauing in a decade. “We used to see increases of 20% or 15 % annually.

Now we will be going up 2% or

No more quantum leaps

The Foreign Agricultural Service (FAS) – a US Department of Agriculture agency – projects Egyptian orange production to rise by 6.2% year on year to reach 3.4m tonnes in the current marketing year (MY), which began last October. FAS Cairo also forecasts that orange exports will hit 1.5m tonnes in MY 2020/2021, up from 1.37m tonnes the previous year More markets are set to open up, yet exporters are close to reaching saturation, says Hussein Marei, a board member of Egypt’s Horticultural Export Improvement Association and a managing partner

Loading up in Beheira province, Egypt

142 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

3% at most,” El-Naggar tells The Africa Report.

Some producers worry that poor statistics are clouding a view of what is happening on the ground.

They point out that official data does not reflect citrus oversupply, especially of oranges, because they are only based on agricultural plots that are registered at notary offices, Marei explains. Unregistered

in Egypt, comprising 60-70% of Egypt’s citrus production. Growing them is much less demanding than other citrus crops like mandarins, which require more technical know-how. Their harvest season extends from January to March or April, a period that corresponds to “a gap in the international market” – a prime opportunity for Egyptian exporters, Marei says.

Marei wants to see the sector strengthened through diversification. He is introducing new seedlings through his company, MAREI Orchard & Nursery. “I have been exhorting many growers not to cultivate the summer [oranges] anymore, and to plant mandarins, grapefruits and lemons to mix it up,” says Marei. Only then “will our reputation as citrus exporters” improve, he adds. El-Naggar agrees and says there is growing demand for citrus products, including grapefruits and lemons, which Egyptian exporters could tap into to beat fierce competition from Morocco, Israel and Turkey.

“Going industrial” could reduce the overabundance of Valencia oranges, which are widely used in juice production, says Marei.

“There is a massive market in Asia and Europe,” he says. “There is potential in different areas […].

Dubai procures its juice products from the US and Poland and pays a lot of money for them.

If they imported them from Egypt, they would be delivered faster and at a better cost.” Marei says Egypt has a head start in exporting not-from-concentrate (NFC) juices, which are fresh and pasteurised.

AHMED GOMAA/XINHUA/REA

parcels of land are mostly in the desert and were seized by farmers who invoked a law introduced by the late agriculture minister Youssef Wali, particularly during the 1980s and 1990s.

“A rough analysis indicated that while the government would say we produce 4m tonnes, [actual citrus production] “is closer to 6m tonnes,” Marei tells The Africa Report. According to projections based on similar analysis, “we are supposed to be producing anywhere from 6-8m [tonnes of citrus fruits],” which is significantly higher than Egypt’s domestic consumption and exported citrus fruits combined.

This caused local prices to plummet in the past year, with losses incurred by producers, Marei says.

Valencia oranges, also known as summer oranges, are the most cultivated and exported citrus fruits

1.5m

tonnes of Egyptian orange exports are forecast for 2020-21, up from 1.37m tonnes in the 2019-20 season

Unlike the concentrate, NFC juice can diminish in quality while being transported to far-flung destinations, and its price is higher due to its more costly transportation. Brazil is the main player in this sector, and Egypt could also be a strong NFC juice exporter to Asian countries.

Tariff-free trade

Khaled Medhat, from food and beverage company Döhler Egypt, says the country’s main advantage is its free-trade agreements as a member of the Common Market for Eastern and Southern Africa, the Greater Arab Free Trade Area and the EU-Egypt Association Agreement. Offering juice products that are cheaper than Brazil’s to countries that exempt Egyptian imports from customs would give Cairo a lead, he says.

Medhat says he would like to see a better system for regulating the relationship between farmers and juice makers to ensure sustainable procurements and fair prices: “The agro-industrial sector is not sponsored by a certain body in Egypt. There are no crops that are cultivated to be allocated for manufacturing,” he says. Egyptian fruit producers of all scales therefore primarily target fresh consumption, and juice makers receive what is left. What facilitates procurement for juice makers is that their specifications are less demanding than those of the fresh market, since they just need to focus on the internal quality of the oranges.

With orange prices fluctuating, a regulator should support either side when needed. “This already exists in Egypt for some items, such as raw milk, whose price is determined by the Egyptian Milk Producers Association,” Medhat says. “We always say we want contract farming in Egypt, but it can only be achieved with an arbitrator,” he concludes.

THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

143

AGRIBUSINESS DOSSIER

INTERVIEW

Mostafa Terrab

To feed themselves and others, African nations need to boost their agricultural production by using fertilisers and other techniques, says the chief executive of OCP Interview by ESTELLE MAUSSION and JULIEN CLEMENÇOT The chairman and chief executive of Morocco’s OCP Group explains its strategy for 2021-2030. The phosphates company is focusing on a more environmentally friendly approach. It also plans on expanding its operations on the continent to tap into the large Nigerian and Ethiopian markets.

Fertilisers are still not widely used in Africa. Is this changing?

MOSTAFA TERRAB: You know that the continent has the potential to feed the whole world, right?

Most of the arable land is in Africa. The continent will double its population by 2050. This is why our commitment in Africa is not as a fertiliser supplier but rather as a partner in the development of public policies in agronomy, rural development and, where appropriate, industry.

This is how we view our industrial commitment in countries such as Ethiopia and Nigeria,

which have one-third of the African population. Our university [the Mohammed VI Polytechnic University in Ben Guerir] is also committed to this and, as such, presents itself as an institution for training African talent.

How should we interpret the decline in recent years in OCP’s exports to Africa, from 27% of your total in 2017 to 21% in 2020?

You seem to forget that our Africa strategy is not even 10 years old. In 2013, we were capping at 50,000tn of exports per year to Africa, and today, our volumes are at around 3m tonnes per year. If you judge performance by volume alone, you won’t have the right indicator.

In some countries, including Nigeria, we have invested in blending units where products are customised locally to suit the needs of the soil and crops. I would like to point out that the OCP Foundation was involved in drawing up a soil fertility map in certain African countries, with the precise purpose of carrying out this customisation.

144 THEAFRICAREPORT / N° 116 / JULY-AUGUST-SEPTEMBER 2021

HOC

‘The continent has the potential to feed the world’ In March, you signed an agreement with Nigeria to build a $1.3bn fertiliser plant there. Several groups, including Dangote Industries, also have major projects there. How do you intend to establish yourself in this huge market?

This agreement was signed following a decision made during His Majesty King Mohammed VI’s visit to Nigeria in December 2016. It brings together Morocco’s phosphate resources and Nigeria’s gas resources for the benefit of Nigerian agriculture and this great country’s immediate neighbours.

Are you going to increase the number of your factories in Africa? Wouldn’t this be to Morocco’s detriment?

To the contrary! A company that wants to be global increases its opportunities for growth whenever the interests of the parties concerned are clear. Proximity also makes it possible to adapt our products to farmers’ needs, thereby reducing the cost of inputs. It’s also important to remember that this growth, which is made possible by investing in the markets, increases the value of phosphorus, which is then available to all! This is the main reason for our approach.

Africa, covered.

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LAST WORD

FUN NMI ADEBAYO Digittal entrepreneur, nomad, writer, avid solo traveller, menttal health advocate, spoken word poet, public speaaker and ex-finance professional

To say I’m disappointed in Britain would be an understatement. I think for many British Africans, we have got to a point where we are either questioning our place in British identity or ready to completely denounce it. It feels to me that Britain is wedded to its nostalgia of empire. Its sense of greatness and British identity now clearly feels predicated on holding onto the delusion that it can an be a geopolitical kingmaker.

‘Global Britain’ may at first appear to o be an innocent attempt at being open to building trade partnerships with the world. On closer inspection, though, it is far more nefarious.

So much so that it isn’t a sleightof-hand nod to colonialism but rather the reemergence of a new, modern colonialist venture.

I am not only talking about what Prime Minister Boris Johnson has said, but rather the ‘Global Britain in a Competitive Age’ government report that is a manifesto to this end.

They may as well have dubbed it ‘Project Colonialism 2.0’. Johnson has laid his jingoistic intentions bare: ‘The fundamentals of this Government’s approach to national security and international policy are

146 THEAFRICAREPORT / N° 116

Britain's government sees Africa as the centre of its ‘Global Britain’ policy. The government report ‘The UK and Sub-Saharan Africa: prosperity, peace and development co-operation’ published last year is a 164-page document focused entirely on how Britain plans to engage. Its mere positioning as a power equal to four-fifths of a continent expresses its perspective on Africa. It would never so boldly publish such a report about Asia.

Describing Britain’s soft power, the report defines it as, ‘rooted in who we are as a country: our values and way of life, and the vibrancy and diversity of our union. It is central to our international identity as an open, trustworthy inte and d innovative country.’ Museums are listed as central. So any hopes that the British Museum Act of 1963 will be revoked – and the Benin Bronzes returned, for example – are clearly pipe dreams.

Britain’s government sees its museums as just as important in maintaining its sense of power and identity as trade relationo ships. This firmly positions war, theft and colonialism as central to the British identity. It’s important that Africans and British Africans hold this government to account and decide if the greatness of Britain relies on the weakness of Africa.

L. FLEISHMAN/NYT-REDUX-REA

ALL RIGHTS RESERVED

COLONIALISM 2.0

reflected in the actions we have taken since the 2019 general election. They demonstrate an active approach to delivering in the interests of the British people: sustaining the UK’s openness as a society and economy, underpinned by a shift to a more robust position on security and deterrence. This runs alongside a renewed commitment to the UK as a force for good in the world – defending openness, democracy and human rights.’

Anybody with a decent grasp of history would shiver at this brazen declaration of Britain First ideology. British colonialism in Africa was built on this approach: that Britain’s ‘force’ for good comes with increased spending on ‘security and deterrence’ – in other words, violence.

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