TAR116 – Q3 2021 - NIGERIA France special by The Africa Report

MTN, Dangote, Ethiopian Airlines... Our exclusive ranking of Africa’s leading firms

N° 116 • JUILY - AUGUST - SEPTEMBER 2021

L to R: Tony Elumelu, Aliko Dangote, Herbert Wigwe, Emmanuel Macron, Gilbert Chagoury, Abdul Samad Rabiu, Mike Adenuga.

INTERNATIONAL EDITION Belgium €7.90 • Canada CA$12 • Denmark DK80 • D.R.C. US$10 • France €7.90 • Germany €7.90 • Ghana GH¢35 • Kenya KES1000 • Morocco DH45 Netherlands €7.90 • Nigeria NGN2000 • Rwanda RWF7,500 • South Africa R75 (tax incl.) • Switzerland FS10.90 • Tanzania TZS20,000 • Tunisia DT15 Uganda UGX40,000 • UK £7.20 • United States US$15.99 • Zambia ZMW80 • CFA Countries F.CFA3,900 • Euro Zone €7.90

JEUNE AFRIQUE MEDIA GROUP

M 08980 - 116 - F: 7,90 E - RD

3’:HIKSTI=UU\^UZ:?a@b@b@q@k";

THE NEW SUDAN Hamdok and the rebirth of a nation

GHANA Akufo-Addo’s difficult second act

www.theafricareport.com

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

#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

CHAIRMAN AND FOUNDER BÉCHIR BEN YAHMED

PUBLISHER DANIELLE BEN YAHMED publisher@theafricareport.com

EDITOR IN CHIEF PATRICK SMITH MANAGING EDITOR NICHOLAS NORBROOK editorial@theafricareport.com

To find the full editorial team, all our correspondents and much more on our new digital platform, please visit: www.theafricareport.com

SALES A JUSTE TITRE Tel: +33 (0)9 70 75 81 77 contact-ajt-sifija@ajustetitres.fr

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.

CONTACT FOR SUBSCRIPTION: Webscribe Ltd Unit 4 College Road Business Park College Road North Aston Clinton HP22 5EZ United Kingdom

64 AFRICA’S TOP 500 COMPANIES The Africa Report’s exclusive ranking of the continent’s largest companies in terms of revenue.

Tel: + 44 (0)1 442 820580 Fax: + 44 (0)1 442 827912 Email: subs@webscribe.co.uk ExpressMag 8275 Avenue Marco Polo Montréal, QC H1E 7K1, Canada T : +1 514 355 3333 1 year subscription (4 issues): All destinations: €27 - $32 - £24

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.

92 NIGERIA/ FRANCE INSIGHT

TO ORDER ONLINE: www.theafricareportstore.com

French firms are betting on the huge market and partnering with Nigeria’s top business leaders.

ADVERTISING DIFCOM INTERNATIONAL ADVERTISING AND COMMUNICATION AGENCY

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

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

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

COVER ILLUSTRATION: DAVI AUGUSTO, COLAGENE.COM

FEATURES

57-BIS, RUE D’AUTEUIL 75016 PARIS - FRANCE Tel: (33) 1 44 30 19-60 – Fax: (33) 1 44 30 18 34 advertising@theafricareport.com

PRINTER: SIEP 77 - FRANCE N° DE COMMISSION PARITAIRE : 0720 I 86885 Dépôt légal à parution / ISSN 1950-4810

THE AFRICA REPORT is published by JEUNE AFRIQUE MEDIA GROUP

MAILBAG

For all your comments, suggestions and queries, please write to: The Editor, The Africa Report, 57bis rue d’Auteuil Paris 75016 - France or editorial@theafricareport.com

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

HOW TO GET YOUR COPY OF THE AFRICA REPORT On sale at your usual outlet. If you experience problems obtaining your copy, please contact your local distributor, as shown below. ETHIOPIA: SHAMA PLC, Aisha Mohammed, +251 11 554 5290, aisham@shamaethiopia.com – GHANA: TM HUDU ENTERPRISE, T. M. Hudu, +233 (0)209 007 620, +233 (0)247 584 290, tmhuduenterprise@gmail.com – KENYA, UGANDA, TANZANIA: THE NEWZ POINT, Dennis Lukhoola, +256 701 793092, +254 724 825186, denluk07@yahoo.com – NIGERIA: NEWSSTAND AGENCIES LTD, Marketing manager, +234 (0) 909 6461 000, newsstand2008@gmail. com; STRIKA ENTERTAINMENT NIGERIA LIMITED, Mrs Joyce Olagesin, info.nig@strika.com – SOUTHERN AFRICA: SALES AND SUBSCRIPTIONS: ALLIED PUBLISHING, Butch Courtney; +27 083 27 23 441, berncourtney@gmail.com – UNITED KINGDOM: QUICKMARSH LTD, Pascale Shale, +44 (0) 2079285443, pascale.shale@quickmarsh.com – UNITED STATES & CANADA: Disticor, Karine Halle, 514-434-4831, karineh@disticor.com – ZAMBIA: BOOKWORLD LTD, Shivani Patel, +260 (0)211 230 606, bookworld@realtime.zm For other regions go to www.theafricareport.com

ADVERTISERS’ INDEX ACCESS BANK P 98-99; AFRICA CEO FORUM P 14; ALAPALA P 139; AXENS P 121; BARRICK KIBALI GOLD MINE P 62-63; BUA GROUP P 104-105; C2I EASY STEEL SHEDS P 82; CAVERTON P 117; CFAO GROUP P 148; CIB P 21; CIU P 85; DANGOTE GROUP P 7; DASSAULT AVIATION P 95; DREAMOVAL P 43; EKO ATLANTIC CITY P 118-119; EKO HOTELS & SUITES P 125; ENDRESS + HAUSER P 69; ENI SPA P 89; EQUITY BCDC P 57; EURONEWS P 60; FANMILK DANONE P 123; HERBERT SMITH FREEHILLS P 135; KEMPINSKI HOTEL GOLD COAST CITY P 47; KONNECT EUTELSAT P 83; LIEBHERR P 23; MAIRE TECNIMONT P 107; MCB GROUP P 25; MD SERVICES P 55; NESSCO P 115; OCP AFRICA P 2, 140-141; OFID P 87; OLAM P 45; PERENCO P 133; PONTICELLI NIGERIA P 109; PROCADRES P 115; QATAR AIRWAYS P 5; RAWBANK P 53; REP. OF DJIBOUTI P 147; SAFICABLES P 59; SFA P 51; TAGPAY P 85; TANGER MED ENGINEERING P 91; TAR SUBSCRIPTION P 145; TOSHIBA AFRICA P 81; TOTALENERGIES P 19, 112-113; UBA GROUP P 17; VOCALCOM P 101

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

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

/ 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.

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

/ 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.

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.

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.

/ 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.

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.

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

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.

/ 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.

APPOINTMENT

ZEITZ MOCAA

C. SURENDRAN

Telling through textiles

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

/ SEPTEMBER

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

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.

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

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.

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

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

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.

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”

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

Africa | Asia | Europe | Middle East

We are faster, closer and safer With our scale, expertise and deep desire to satisfy your needs, we will deliver exceptional experiences for the moments that matter the most to you.

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.

Omnichannel contact center solutions

Multi-awarded Contact Center solution With our ultra-intuitive, omnichannel solution recognized for the 7th consecutive year in Gartner Contact Center-as-a-Service Magic Quadrant, you can improve agent productivity and optimize customer conversations. Our user-friendly software provides agents with dedicated features to have smooth conversations and deliver personalized responses throughout the customer journey—whatever the communication channel— for smart and agile connections. www.vocalcom.com

Trusted by leading brands in Nigeria

Contact Vocalcom partners in Nigeria

Cloud & on-premise, Omnichannel, CRM integration, Salesforce native solution

0803 227 9851 https://arravo.co 0814 902 0902 https://relaisltd.com

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

103

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.”

Think about thousands of highly skilled professionals with distinctive competences and technological know-how in the natural resources transformation sector. Petrochemicals, oil&gas refining and fertilizers are our core industries, while we aim at accelerating the world energy transition through low carbon technologies and green chemistry. This is Maire Tecnimont Group: a plant engineering leader focused on the chemical processing of conventional and renewable energy resources into advanced products embedded in everyday life. Our business strategy on geography diversification is a key element to grow and assist our clients in their revamping initiatives, leveraging on our technological know-how to ensure more efficient and environmentally better performing processes and products.

We are strongly increasing our focus on initiatives for the modernization of the reﬁning sector: we are enhancing our footprint in Nigeria and in Sub-Saharan Africa, a market with excellent downstream prospects given its demographics and the necessity to unlock greater added value from the transformation of natural resources.

COUNTRIES

COMPANIES

~1500

TOTAL DELIVERED PROJECTS

mairetecnimont.com

INSIGHT NIGERIA/FRANCE /

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.”

Mike Adenuga

Starting a new long term support services contract with NLNG in 2021

We thank our clients for their trust since 1995 enabling us to develop a Nigerian services offer for industrial projects.

DESIGN, PROCUREMENT, FABRICATION, GENERAL CONTRACTING, COMMISSIONING AND MAINTENANCE. Plot 103/104 Rivoc road Off TransAmadi Port-Harcourt – Nigeria contact@ponticellinigeria.com

www.ponticelli.com

INSIGHT NIGERIA/FRANCE /

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

ADVERTORIAL

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

THE RIGHT MANAGER, ON THE SPOT, WITH IMMEDIATE CALL TO ACTION

SUPPLY CHAIN CRISIS MANAGEMENT

FINANCE

TRANSFORMATION BUSINESS DEVELOPMENT

PROCADRES AFRICA › 20 YEARS OF SUCCESSFUL TRACK RECORD M&A, restructuring , turnaround, transformation and optimization.

THE ONE-STOP SHOP FOR YOUR EXECUTIVE AND PROJECTS RECRUITMENTS.

www.procadres.com

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

“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.

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

IFC EDGE certiﬁed green buildings

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.”

POWERING A COMPLETE OFFER

Promoting and providing for more than 60 years stateof-the-art solutions and products for the production of clean road fuels and plastics in Nigeria www.axens.net

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

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.

THEAFRICAREPORT

127

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

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.

Advertorial

ctedre e n n o c SuperMbps everywhe 0

0 Up to 1

Konnect satellite Internet, for everyone, everywhere Internet, for individuals and professionals wherever you are Thanks to the latest satellite technology, Konnect (Eutelsat Group) is participating in the development of the African continent by acting to reduce the digital divide. Konnect has created a range of services and packages to provide Internet connectivity, even in areas not covered by any other technology. Konnect is the promise of high-quality, affordable Internet for all. Konnect provides public institutions, individuals and businesses with flexible, affordable Internet packages. Satellite Internet from Konnect is accessible nationwide, even where there was no reliable connection before. Konnect offers a wide range of fixed Internet packages. This range includes connection speeds of up to 100 Mbps and prices from 14$/month, offering a package for all needs and means. Thanks to our Happy Hours, users data consumption is not counted between 10pm and 6am, so data hungry downloads and updates can be scheduled overnight without counting towards data consumption.

At the same time, we are developing our Express Wi-fi service to provide a quality Internet connection for people with limited financial means or needs. Express Wi-fi from Konnect offers internet access to even the most isolated areas. Our Wi-fi “hotspots” provide connectivity with a 100-metre radius. Flexible Wi-fi vouchers provide access from 1 hour up to 1 month and many options in between. They are available for as little a 0,25$. These hotspots can be located at shops, schools, town halls and farms to name a few. Konnect is always on the lookout for retail partners, installers and small businesses looking to diversify their income and connect their community with the help of our Express Wi-fi solution. Anyone interested in setting up a hotspot can contact the Konnect team (https://africa. konnect.com/fr/nous-contacter) to find out more. Finally, we enable everyone to connect their family to the world or to develop their business, regardless of their geographical location. Today, nearly 40 African countries can benefit from Konnect services. Key benefits of Konnect include:

These services are available on a prepaid basis to meet the needs of the African market.

High speed – A first for Africa with speeds up to 100 Mbps.

Connectivity for development

Affordable – Starting from 14$/month.

Konnect regularly works with African governments and public institutions to bring quality connectivity to remote areas. These actions make it possible, among other things, for public services to continue even in the event of crises or extreme conditions, they allow isolated hospitals to benefit from telemedicine, and they connect thousands of schools and teachers to knowledge.

Quality – Video streaming up to full HD-quality.

All inclusive package – Rental of the equipment is from 79$. To find out how you can benefit from super-fast broadband wherever you live visit: www.konnect.com.

konnect.com

WITH AFRICA FOR AFRICA M O B I L I T Y

H E A LT H C A R E

C O N S U M E R

INFRASTRUCTURE

With a revenue of over €5.8 billion, access to 46 of the 54 countries on the continent and almost 21,000 employees, the CFAO Group contributes to the growth of the African continent, its industrialization and the emergence of the middle class, drawing on its in-depth ﬁeld knowledge and local expertise. The Group partners with leading international brands and covers the entire value chain – import, production, distribution – in line with the best international standards.