The continent magazine issue 6 by The Continent Magazine

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April 2016 Vol.2 Issue 6

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APRIL.16

CONTENTS 5

News Guelleh sues Facebook, drones in Rwanda, and MTN layoffs in South Sudan

Innovation Diary Talking toilet technology

14 DAALLO

FLIES FORWARD

Mohammed Yassin on staying strong in the face of adversity

Five Questions Microsoft’s Amrote Abdella

10 Ways To start a business

Cheap Seats Low-cost carriers shake up the market Ethiopia Industrializes Interview with Dr. Arkebe Oqubay

20 26

3D Printing the Future From prosthetics to construction

Girl Power Three women share their stories Data Driven Jamilla Abbas on mobile agriculture

30 32

Gambled Away Sports betting is the new employment Bank Run Kenya’s CBK cleans up

Impact Investment The new way to grow your money

w w w. t h e c o n t i n e n t m a g . c o m

EDITORIAL The End of Men? our last issue of The Continent proudly, only to realize, ouch, that we had failed to include a single woman – not a picture, nor an interview, nor a feature. Shame on us, especially considering most of our contributors and staff, including myself, are female. It was easy to find women to feature in this next issue, considering the prominence they are taking in the workforce and in corporate leadership in the region and around the world. Amrote Abdella with Microsoft and entrepreneur Jamila Abbas are cases in point. As well, we have the courageous stories of Fatma Haji, Angel Namshali, and Annie Nyaga who are standing their ground in professions traditionally dominated by males. I went fishing for statistics on women in the workforce in Eastern Africa and was pleasantly surprised. In many countries in Eastern Africa the rate of participation in the labor force by females matches that of males. In Tanzania, Rwanda, and Mozambique, for example, almost 80 percent of men and 80 percent of women are working, while in the UK approximately 80 percent of men are working, compared to only slightly more than 50 percent of women. Perhaps these African countries should send consultants to the British and other western countries to help them reduce their gendered labor gap. But of course Africa is far from earning full bragging rights when it comes to women. The vast majority of female jobs are informal, such as domestic work and agriculture, with no labor laws, no minimum wage, and of course no maternity benefits or old age pension. In agriculture, women experience lower yields than men, not because they are weaker or inherently less productive, according to the Food and Agricultural Association, but because they receive reduced access to inputs, resources, and services. I won’t even get started on the rights of women when it comes to land ownership, a situation that sets many up to fail. The C-Suite is not looking so impressive either. According to Africa Advisory Group, only 2.5 percent of the top 200 businesses on the continent have female CEOs. This is compared to 4.8 percent of US S&P 500 companies and 5 percent UK FTSE 100 companies. The Kenyan government deserves credit for taking note of this and setting a quota of 33 percent for women representation on boards. Perhaps this will have the same impact as the quota for the Rwandan parliament. The 2003 constitution required a minimum of 30 percent female participation, and today women in the House of Deputies make up a staggering 64 percent. But quotas may not be necessary. As the global working world changes, from physical labor to jobs that require thinking and communicating women are stepping up and in many cases outshining their male counterparts, particularly in management positions and in higher education. “The postindustrial economy is indifferent to men’s size and strength,” writes Hanna Rosin in her famous article “The End of Men” for The Atlantic. “The attributes that are most valuable today—social intelligence, open communication, the ability to sit still and focus—are, at a minimum, not predominantly male. In fact, the opposite may be true.”

WE FINISHED UP

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Kathryn Semcow, ed ito r editor@thecontinentmag.com @thecontinentmag

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April 2016

Editorial EDITOR

Kathryn Semcow SUB-EDITOR

Jeremy Daniel CREATIVE DIRECTOR

Craig Willers CONTRIBUTORS

Aaron Kirunda Anthea Rowan Jeremy Daniel Martin Rivers Munene Kilongi J.A. Young Anton Moore Eamonn Ryan Reuben Kyama Roberta Annan EDITORIAL ENQUIRIES

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UP FRONT due to the effects of the recent drought on the agricultural sector. Average growth for the past 10 years has been more than 10 percent a year, including 10.2 percent last year, according to Bloomberg. Djibouti

T H E Prime Minister of Djibouti, Ismail Omar Guelleh, is suing Facebook, according to the Sunday Times. The reason behind the lawsuit has not been made public, but Guelleh has hired Irish law firm Johnsons, which is known for representing Hollywood celebrities in defamation cases.

Eritrea T H E E R I T R E A N G O V E R N M E N T says it will have four mining companies operating by 2018, according to Reuters. The country currently has only one mine in operation, the northern Bisha mine, which is a joint venture between the state mining company ENAMCO and Canada’s Nevsun Resources. A new gold mine, a joint venture with a Chinese company, is slated for production in April, followed by a mine producing gold, copper, and zinc in 2017, and a potash mine by 2018.

Ethiopia

Agriculture Investment and Land Administration Agency, which has leased 476,000 hectares of land since it was formed in 2013, has suspended the issuance of new licenses while it reviews reasons for poor progress so far. Of the 2.43 million hectares leased to domestic and foreign companies since 2011 by different agencies, only 30 percent has been developed so far, according to Reuters. Regional agencies are ET H I O P I A’ S

expected to follow with similar suspensions. Land deals in Ethiopia have received criticism for a lack of transparency, negative environmental impact, and the resettlement of local populations. Ethiopian Government has shelved its “Integrated Development Master Plan” in the face of protests from the Oromo people, according to Al Jazeera. Residents of Oromia, the country’s largest region, THE

have expressed concern over plans to expand the capital Addis Ababa into Oromia farmland. Human Rights Watch estimates approximately 200 people have died from the government’s crackdown on the protests, while the government denies the figure. T H E Ethiopian Government has reduced its growth projection for this fiscal year ending in July, from 11 percent to between 7 and 10 percent,

S A U D I Arabia will establish a military base in Djibouti, the Djiboutian Ambassador to the kingdom told Gulf News. Djibouti already hosts American and French bases, and a Chinese base is under construction.

86.68

The percentage of votes claimed by Ismail Omar Guelleh in Djibouti’s recent election, winning him his fourth term as president.

S U DA N

T H E Government of Sudan has launched an online trading system for its stock market. The project financed by the African Development Bank is hoped to promote the development of the Khartoum Stock Exchange. w w w. t h e c o n t i n e n t m a g . c o m

UP FRONT to the fund, for a total of US$110,000. The territory is currently experiencing a widespread drought, one of its harshest in several decades. Somalia

MTN-CEO-Philip-Besiimire

South Sudan

M T N South Sudan says it is laying off more than half of its staff, reducing workers in the country from 170 to 80, and cancelling plan to build more communication towers, according to Bloomberg. The decision is a reaction to the country’s economic crisis, including a currency collapse and inflation brought on by a halt in oil production and ongoing conflict.

Telecommunication Company has reopened services in Bentiu, two and a half years after it was dismantled due to conflict in the oil-rich Northern Liech State (formerly Unity State). According to the Sudan Tribune, the governor of the state Joseph Nguen Monytuil petitioned President Salva Kiir to reactivate the service.

ZAIN

Somaliland

operator Telesom has donated US$50,000 to Somaliland’s national drought emergency fund, according to Somaliland Press. This is the second donation the company has made

TELECOM

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April 2016

V I S A has partnered with Somalia’s Premier Bank in an agreement that will allow Visa cardholders to use the bank’s ATMs, according to Standard Media. “We are delighted to partner with Premier Bank as our first client in Somalia…” says Jabu Basopo, Visa’s General Manager for Southern and East Africa. “We hope that this partnership will encourage further electronification of commerce in Somalia.”

Uganda

to the recently leaked Panama Papers exposing offshore accounts with Mossack Fonseca, UK-based Heritage Oil and Gas worked aggressively to avoid a capital gains tax Uganda was preparing to impose. In 2010 the company sought to transfer its registration from the Bahamas to Mauritius, which would allow it to reduce its bill from US$400 million to zero. Since then the company has been involved in lengthy court battles in Uganda and the UK over t he bill.

ACCORDING

U G A N D A ’ S toothpick industry and other cottage industries based on bamboo such as mats and crafts are suffering from poor cash flows, according to the Budget Monitoring

Rusumo International Bridge whilst under construction

and Accountability Unit. Bamboo supplies are readily available in the western part of the country, and the Uganda Industrial Research Institute and the China Bamboo Research Center have been exploring the commercial viability of bamboo-based products since 2005.

The number of tons of antiretroviral drugs Uganda’s Cipla Quality Chemical Industries recently exported to Namibia. The shipment worth US$4 million is estimated to be the largest export of HIV/Aids drugs out of East Africa, according to allafrica.com.

Tanzania

T A N Z A N I A and Rwanda recently opened the Rusumo International Bridge and border post linking Rwanda to Dar-

es-Salaam Port. Up to 60 percent of Rwanda’s cargo passes through Rusumo, and more than 2,000 people per day. While the former bridge could accommodate trucks of only 80 tons, the new bridge facilitates up to 180 tons per vehicle. Increased capacity, along with the border post that combines Tanzanian and Rwandan customs officials, is expected to reduce transit time from one hour to 20 minutes, according to officials. Rwanda

U S - B A S E D Zipline International has announced it will begin flying drones in Rwanda in July. The unmanned aircraft will deliver medicine and blood to across the country, in partnership with the government. Hospitals will be able to order supplies via text message, and receive

VERBATIM Drone will deliver medical supplies across the country

them within minutes from one of the custom-made planes. “To put it into perspective, when you don’t have paved roads, sometimes it’s impossible to get out to these hospitals and health clinics, and sometimes it’s just difficult,” says Zipline CEO Keller Rinaudo. Malawi

Malawi and US governments have launched a campaign to fight drug theft in Malawi, which is estimated to cost both governments US$11 million per year. Measures include establishing a Drug Theft Administration Unit, increased police inspections, and a hotline for reporting theft. According to US Ambassador to Malawi Virginia Palmer, individuals in health facilities are stealing large quantities from clinics and selling them inside and outside the country. THE

Zambia

G L E N C O R E has announced it will invest more than US$1.1 billion in its Mopani copper complex over the next two years. The Swiss mining company says it will return output

“THEY SHOULD HAVE LEARNED THE LESSON OF OUR HISTORY.”

Rwanda President Paul Kagame discussing current violence in Burundi.

“WE HAD SOME INDIVIDUALS THAT SHOUTED FIRE IN A CROWDED THEATER ROOM; TO ME THERE IS NOTHING AS RECKLESS AS THAT.” Central Bank of Kenya Governor Patrick Njoroge reacting to “malicious comments” on social networks that led to a run on Chase Bank and the government stepping in to save the bank.

“THE GENOCIDE LABORATORY IS IN RWANDA BECAUSE PRESIDENT KAGAME, HAVING EXPERIMENTED THERE, [WANTS] TO EXPORT IT TO BURUNDI [TO] PLAY A MINOR IMPERIALIST.” Pascal Nyabenda, President of Burundi’s CNDDFDD party, accusing Rwanda of political interference.

“IT’S NOT THE #POWEROFKOT THAT BROUGHT #CHASEBANK DOWN BUT POOR FINANCIAL DECISIONS & ABUSE OF OFFICE!” Nation FM radio presenter Mumbi Seraki defending Kenyan tweets about Chase Bank, despite the Central Bank’s insistence the bank is sound.

“DO NOT WORRY, CHASE BANK. EVERYBODY IS BROKE IN THEIR 20S.” Online book publisher and store theMagunga, run by Magunga Williams, acknowledging the bank is 20 years old.

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UP FRONT majority of the money was spent on security activities associated with the loan. The country is offering to swap the outstanding US$697-million bonds issued by state-run tuna company Ematum, which mature in 2020 with a coupon of 6.305 percent, for a new issue maturing in 2023, at 80 percent of the price and with a coupon rate of 10.5 percent, according to Reuters.

400

The number of people in Burundi the UN estimates have been killed by political violence since President Pierre Nkurunziza announced his bid for a third term in April 2015.

Madagascar

president Hery Rajaonarimampianina has appointed a new prime minister, former interior minister Solonandrasana Olivier Mahafaly, after a confusing announcement of the previous prime minister’s resignation. The president’s office had announced earlier that Prime Minister Jean Ravelonarivo and his cabinet had resigned, while Ravelonarivo claimed he had not. Mahafaly, in his new post, has pledged to fight poverty and corruption.

MADASGCAR’S

Zimbabwe’s central bank governor, Johan Mangudya

to 110,000 tons per year by 2018, more than double the current output of 47,000 tons. The mine has not run at full capacity since 2014 due to low copper prices, electricity shortages, and increased taxes. Moody’s estimates the production could increase Zambia’s GDP by up to 0.5 percent in 2018. Zimbabwe

financial services sector has imported US$216 million between January and April this year, according to the central bank governor. Johan Mangudya told parliament the central bank imported US$145 million, while six banks imported US$118 million. He says

ZIMBABWE’S

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April 2016

the cash shortage was due partly to bonus payments for civil servants, maize imports, and speculative withdrawals due to lack of confidence in the banking sector, according to Voice of America.

The age Robert Mugabe will be when he runs – yet again – for the Zimbabwe presidential election in 2018

MOZAMBIQUE

has proposed a restructuring of its state-backed “tuna” bond. The bond was sold to create a national tunafishing company, but the MOZAMBIQUE

Burundi

D E S P I T E growing international concern about violence in the country, Burundi’s government is resisting United Nations Security Council resolutions to deploy monitors to the country. The resolution to deploy a United Nations police contingent into the country was welcomed by the government, while it maintained that it will not “tolerate external authority” as it seeks to go about its affairs.

Nairobi

Kenya

K E N Y A is set to announce US$600 million in Chinese concession funding this financial year, as total spending is set to grow by 2.3 percent amidst strong economic growth. Treasury Secretary Henry Rotich explained that “the economy is benefiting from low oil prices and is not affected by the drop in commodity prices”, according to Bloomberg reports.

1,000

The number of Kenyans who use Uber each month to catch a ride. Kenya is the fastest growing market for the mobile taxi service, despite opposition from local taxi associations and drivers.

INNOVATION DIARY INNOVATION DIARY

LOW-COST TOILETS D U R I N G T H E P A S T year, a company known as Sanivation has been piloting several projects in Kenya aimed at integrating low-cost toilets within refugee camps. The company’s goal is to improve sanitation for people in developing nations worldwide. The Kenyan experiment has demonstrated that these toilets aren’t just about sanitation; the company is, quite literally, transforming human waste into fuel that can be used for heating homes and even cooking.

Addressing a Problem

low-cost toilets began as research conducted in the US. at Emory University and Georgia Tech. According to the United Nations, more than a billion people worldwide continue to practice open defecation, and the World Health Organization has estimated that well over a billion people use drinking water that has been contaminated by fecal matter, a harbinger of disease. By addressing the problem of poor sanitation, humanitarian organizations and companies like Sanivation are hoping to reduce related illnesses and deaths, and improve the quality of life for people worldwide who do not have access to decent sanitation.

S A N I VAT I O N ’ S

A Green Approach to Sanitation

of the most innovative features of Sanivation’s low-cost toilets is not simply the design or even the affordability. The innovation is the process by which Sanivation collects waste from its toilets, and employs solar energy to treat and transform that waste into usable charcoal

ONE

By addressing the problem of poor sanitation, humanitarian organizations and companies like Sanivation are hoping to reduce related illnesses and deaths, and improve the quality

that increasing numbers of people have been able to use the briquettes and spread the word about their efficiency and their lack of odor.

of life for people worldwide who do not have access to decent sanitation.

briquettes, devoid of unpleasant odor and sanitary enough to use for cooking. Recycling human waste into fuel is a remarkable solution for addressing the problem of fecal contamination. But the ability to efficiently collect, transform and then redistribute the charcoal on a wide scale is something the company will have to consider in the future. For now, initial projects like the Kenyan refugee camp experiments are aimed at encouraging people to adopt the toilets and make use of the charcoal. Unsurprisingly, some people feel a bit apprehensive once they realize how the briquettes are made. They Don’t Smell Bad

W I T H I N the camps, people who have used the charcoal briquettes delivered by Sanivation have been pleasantly surprised. The briquettes not only burn more efficiently than other fuel sources, but they do not smell remotely like fecal matter. The company has also stated that their briquettes burn cleaner than other fuel sources like coal. One of the highlights of the Kenyan project is

From Camp to Community

D U R I N G the Kenya refugee camp project, Sanivation distributed thirty of its low-cost toilets and picked up waste every three days. The company is currently working to raise funds to improve its waste-to-charcoal transformation in order to increase the volume of waste it can process at any given time. Naturally, once larger volumes of waste can be treated, more toilets can be distributed, which has the potential to improve sanitation for communities that currently have no modern toilets or sanitation systems.

Sanitation Saves Lives

T R A V E L I N G to Nairobi and other regional cities, one often sees children playing in brackish streams, in water that is contaminated and, therefore, unsafe. The U.S. Centers for Disease Control and Prevention has stated that diarrhea kills more than 2,000 children each day. That many of these deaths may be preventable is something at the heart of Sanivation’s promising research and innovative toilets. By promoting health for humans, the company is enhancing people’s dignity and improving the environments where people live. w w w. t h e c o n t i n e n t m a g . c o m

FIVE QUESTIONS

AMROTE ABDELLA Regional Director, Microsoft 4Afrika The mandate of Microsoft 4Afrika is to link your business with initiatives that accelerate growth on the continent by helping to improve skills, access to technology, and innovation. What is the link here? How do you connect these activities to your own bottom line?

4 A F R I K A is tightly connected to Microsoft’s network of more than 10,000 existing partners in Africa today, a network we have built through 23 years of investing and operating on the continent. Microsoft’s business model is built on a strong partner network, globally, and Africa is no different. Today, 4Afrika leverages our partner ecosystem to drive impact in the public and private sectors to help advance common goals and to create value for Africans, by Africans.

You have been running a pilot project in Kenya to test the viability of broadband internet that relies on solar WITH and TV white spaces. How stations does this technology work? Where are you with the project now and what kind of results have you seen?

A T no time is the entire telecommunications spectrum fully utilized by radio, TV, emergency services, or 3G/4G transmission. The term “TV White Space spectrum” refers to frequencies in the VHF and UHF television broadcast bands that are either unassigned, or unused by existing broadcast, or other licenses. Using a basic TV antennae and lowcost base stations,

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the infrastructure required to deliver high quality web access is significantly cheaper than any other broadband service available today. And because the base stations can be solar powered, we are able to provide both lowcost web access and power to areas that are currently not connected to the national power grid. The solution works equally well for campus environments, home users, health facilities, government offices, and small and medium business owners virtually anywhere in the world. Microsoft continues to partner with internet access

5 QUESTIONS WITH | AMROTE ABDELLA

providers and other public- and private-sector entities on innovative, practical, and scalable connectivity and services solutions such as the TV White Spaces, and new forms of wi-fi designed to deliver the greatest socio-economic impact to the greatest number of people. Microsoft and its partners are delivering internet connectivity to communities in 18 different countries

I BELIEVE THAT FOR US TO PROMOTE INCLUSION OF MORE WOMEN IN WORKPLACES ACROSS AFRICA, WE NEED POLICIES AND THE ENACTMENT OF SUCH POLICIES THAT SUPPORT INCLUSION AT ALL LEVELS. across 5 continents. Eight of these projects are in Africa. So far, through this partnership we have been able to connect about 90 primary and secondary schools with about 43,000 students, as well as nine university campuses with about 143,000 university students. Mawingu was the first TV White Spaces pilot we launched in Africa. To date, the Mawingu network provides internet

access to a total estimated population of 20,000 people living in or around Laikipia County in Kenya, including 1,100 students (grades K-12) at six different schools. Mawingu has also converted shipping containers into solarpowered ICT labs to provide a space for local community members to access low-cost internet, charging for devices and technical expertise provided by tech-savvy Mawingu network agents. Today, “Bucket-Fi” connects 20 to 25 people who visit the converted ICT labs each day. The project offers internet access and device charging to community members visiting the Bucket-Fi locations. The Mawingu business model assumes a monthly average revenue per user (ARPU) of US$ 3.50 per month. It has been three years since you launched the Huawei 4Afrika phone, designed specifically for the African consumer. What has the market response been to this product? What kind of sales have you seen? Any plans for further Africa-focused products?

S I N C E the launch of the 4Afrika initiative, we’ve gained valuable learnings in our effort to deliver smart devices to youths as well as small and medium enterprises, the Huawei4Afrika being one of them. We’re working with innovative existing and new manufacturers to land world-class phone and tablet devices that are affordable and create relevant value for African users. To land these devices affordably, we continue to apply a variety of strategies with service providers and customers, which include new channel models, smart financing approaches, and innovative logistics while growing local service providers who are proactive and willing to share and invest in the opportunities. For example: In partnership with the Government of Rwanda and the Ministry of Education, Microsoft has supported the establishment of

the first regional devices assembly factory in Kigali, Rwanda, through an agreement signed in November 2014 between the Government and Positivo BGH, an Argentine and Brazilian company. The company will be manufacturing PCs and tablets for students and consumers of Rwanda running on Windows 10. This is also in support of the government’s drive to create local employment opportunities, promoting the use of genuine software, and attracting foreign currency through export of PC’s and tablets to other countries in Africa. This also helps in reducing the cost of PCs and tablets and allows Microsoft to get devices into the hands of thousands of students and consumers across the continent. Your organization focuses on providing opportunities to women. As a successful woman, what do you think African women need in the business world?

A T Microsoft, we strive to create an environment that helps the company to capitalize on the diversity of our people and the inclusion of ideas and solutions to meet the needs of our increasingly global and diverse customer base. I believe that for us to promote inclusion of more women in workplaces across Africa, we need policies and the enactment of such policies that support inclusion at all levels. Second, women need opportunities to close the gender gap in leadership, especially in male-dominated industries. In the IT sector for example, we support activities to entice kids into the field, especially young girls through our DigiGirlz program. By encouraging young girls to pursue a career in STEM, we are actively seeking opportunities for them to understand and get insight into the industry, be it through our internship program or Microsoft Academy for College Hires program. w w w. t h e c o n t i n e n t m a g . c o m

10 WAYS TO

START A BUSINESS THAT THRIVES Aaron Kirunda, Co-Founder of Ugandan social enterprise Enjuba, offers 10 lessons for creating a successful business. it is far more important to do things right from the start than to fix them at a later stage. Lots of literature exists on how to get started and how to turn an idea into a business. Below I share what I believe are important lessons from my several years in business.

IN MY EXPERIENCE,

Who do you want to become?

In business (and in life), it is key to figure out how you want everything to end. A picture of who you want to become or how you want to be remembered is key in helping you to make the first steps. So get crystal clear on why you want to start your business. This is an important step and one that will give you staying power when things go wrong (and trust me they always do). So whatever the reasons are, you need to figure them out early. Personally, I was motivated by a desire to help others to reach their full potential, and that has guided all my businesses. Your reason may be to achieve financial freedom or to have more time with your family.

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April 2016

Whatever the reason, it has to be super-powerful and strong, and you will need to put it in a memorable form, like a mantra – a short statement of intent to constantly remind you of who you want to be and why you’re doing what you’re doing.

existing businesses and finding the weaknesses in their business models, and offer something better.

As you start your venture, you will face the question of naming your business. Consider this very seriously and spend some time thinking about branding. Your business will be known by the name you choose, so find an easy and simple name to pronounce and remember. I would advise a oneword company name, and a name that resonates with the people you will be serving, one you can attach a story to. Consider a simple name with a first letter that occurs early on in the alphabet.

Provide a useful solution

Every successful business involves solving a problem. The bigger the problem and the better the solution you provide, the bigger the business. Some businesses will never grow as big as others because the problems they solve may not be that big or widespread, but for some customers, they will be essential. So what problem do you want to solve? What is your solution? How unique is your solution? The ability to answer these questions sets you on a clear path to establishing a great and sustainable business. It comes down to you, your vision, and your solution. Try finding a problem you can solve by looking at

Find an appropriate name

Find a business soul mate

No business was ever built by one person. Jobs had Wozniak, Gates had Allen, Sergey had Larry, and on it goes.

10 WAYS TO | AARON KIRUNDA

It is important that you find people to be part of your team, to start this adventure with. Although we have been fed on the media celebration of the individual which makes us think that there is just one person who made it all come together, it takes a team to make a new venture work., Find someone who believes in what you want to do as much as you do, someone who brings something different to the table that complements your skills. You have to both share the vision and be on the same page in terms of expectations and commitment.

Just start!

Don’t wait for the perfect time to launch! Too often, people spend so much time in paralysis analysis, researching and analyzing things without actually diving in. You will never get to know everything about that business until you start it, because other people’s experiences are different from your own. It is important that once you have figured out your solution to your problem that you go ahead and try it. Get to work, make something, offer a service, meet your customers, get feedback, and improve. It is very important that you get to market early and get feedback as soon as possible and improve and get back to the market. You are nothing without customers. Your idea is just that – an idea until it is tested. Ideas are commonplace, but execution is everything.

Pick a business model

Think about how you are going to make money and how you are going to grow. After you have thought about that and put it in place, then think about how your new service or

product is going to make money and keep going. How are you going to sell, how much are you going to charge, can people afford it? What are your closest competitors charging? What is your margin? Businesses die when they run out of money, so think about who has your money in their pockets and how you are going to get that money from their pockets to yours.

Start small and be patient

Many start-ups these days want to “make it” overnight. There is no such thing as an overnight success. For every company that you see, realize that the founders invested approximately 10,000 hours of concentrating on that trade or line of business before you ever even heard of them. They started somewhere before they launched that IPO and became “instant” billionaires. Businesses take time to grow and to be nurtured. It requires perseverance to become the overnight success that you dream of. So take a deep breath, and invest in yourself and in your business, for success is at the end of the tunnel. You just have to make it there.

Become a monopoly

Niche yourself. Find a segment of the market that you can monopolize, master, and then scale. It is possible that your identified solution is already taken, so take a look at what existing businesses are doing and find a unique solution you can provide to a smaller segment of the market, then own it. “Forget about taking one percent of a US$100-billion market, it doesn’t work that way when you are starting up.” Monopolizing a small segment will help you understand your customers deeply and help you provide a more

useful solution, so when you expand, you quickly reach a tipping point.

Don’t write a business plan

Do not spend time writing an elaborate business plan, as you may never practically use it when running your business. Spend some time instead weaving a MAT (Milestones, Assumptions, Tasks), as Guy Kawasaki says in his book The Art of the Start. Create milestones to keep you in check. Milestones are targets you want to achieve at a particular time. Write down all the assumptions you are making about your idea, and take action when they turn out to be false, and learn the lesson. Finally, list the tasks you need you need to do to achieve your milestones or targets. Assign these to your team and get started. This will practically help you get things done.

10.

Immerse yourself in learning

Research and study anything and everything you can find that is important to your business. The internet contains an abundance of information, make use of it. Find a mentor, ask questions, listen to podcasts and audiobooks, and become an expert in your area of business. The more you learn, the more confident and motivated you will be. Go! Make it happen! Enjuba is a micro-finance company based in Kampala providing competitive credit to facilitate social and economic change. It also runs the Uganda Spelling Bee, which Kirunda founded in 2012 to promote child literacy. www.enjuba.com w w w. t h e c o n t i n e n t m a g . c o m

TRANSPORTATION | DAALLO AIRLINES

HOME GROWN SUCCESS Mohammed Yassin, chief executive of Somalia’s Daallo Airlines, has overcome grave security threats and intense competition to keep his countrymen connected to their homeland, writes Martin Rivers overall scale, Somalia is undeniably a minnow in the global aviation market. About 420 scheduled flights take off from the country each month, compared with more than 8,900 in neighboring Kenya – East Africa’s most developed aviation market. Somalia also has unique challenges on the security front. Though no longer considered “the most dangerous city in the world” by the United Nations, its capital city Mogadishu remains a battlefield for the ongoing struggle between African Union forces and Al Shabaab, the Al Qaeda-linked terrorist organization. Shootings, kidnappings, and bombings are a daily occurrence. Yet it is precisely because of these difficulties that civil aviation in Somalia – though modest in size – has become a lifeline for the country. With a vast diaspora spread liberally around the globe, and with few options for ground transportation inside the country, flying is the only means by which Somalis can visit and move around their homeland safely. Three privately-owned carriers dominate the local market – Daallo Airlines, Jubba Airways, and African Express Airways – between them providing twothirds of the country’s airborne seating capacity. Their steady expansion during more than two decades of civil war contrasts with the collapse of state-owned Somali Airlines and the exodus of almost every foreign carrier from Mogadishu. “We’ve been doing this for the last 25 years. Whoever was fighting who, air transport and the [travelling] public was always safe from attacks,” Mohammed Yassin, the chief executive of Dubai-headquartered Daallo, tells The Continent. “There was a time when there were no money transfers, no telephones, no postal system – we were everything for the country. We were the link to the outside world… We transportIN TERMS OF

ed not only people, but goods, money, medicine. It was quite a history. And still we are playing that role.” Daallo launched operations in 1991, the same year that dictator Siad Barre lost his grip on power and Mogadishu fell into the hands of competing warlords. As lawlessness prevailed across Somalia, private-sector airlines took extraordinary risks to keep the country connected. They found opportunity in the “void” created by the failure of state institutions, initially deploying Soviet-built metal before transitioning to western planes. The fact that, until now, none of the country’s main airlines had suffered a fatal incident is testament to their high safety standards and operational excellence. But their luck ran out on February 2, 2016, when a suicide bomber evaded security screening at Mogadishu Airport and boarded Daallo Flight 159 to Djibouti. The events that unfolded made headlines around the globe, thrusting Yassin into the glare of the international media and forcing him to confront preconceived notions about the war-torn country. Abdullahi Borleh was the man responsible for the crisis. After bypassing security checks with the help of an airport employee, he detonated a laptop bomb about 20 minutes into Flight 159. Mercifully for the other 73 passengers, pilot Vlatko Vodopivec had not yet reached cruising altitude and was thus able to execute an emergency landing. The only casualty was Borleh himself, who was sucked out of the hole blown in the Airbus A321’s fuselage. With a second laptop bomb detonating at Beledweyne Airport in March, there are fears that a new wave of attacks by Al Shabaab could choke off demand for travel to the country – in turn stemming the flow of foreign direct investment.

“WE TRANSPORTED NOT ONLY PEOPLE, BUT GOODS, MONEY, MEDICINE. IT WAS QUITE A HISTORY. AND STILL WE ARE PLAYING THAT ROLE.”

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THE EAST AFRICA COMMUNITY… SHOULD FOCUS ON HOW THE INFRASTRUCTURE OF THE REGION CAN BE INTEGRATED, AND HOW COLLABORATION CAN BE ACHIEVED WITHIN THE DIFFERENT SECTORS

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BUSINESS | JAMILA ABASS

NEW PHENOMENON

is candid when discussing the incident, admitting that it constitutes a “new phenomenon” not previously faced by Somali carriers. “It’s the first time that we have encountered this type of attack,” he says. “The war was initially among the Somali people and [about] their differences. It’s so complex now… It’s not a Somali issue anymore. It has got international dimensions.” Despite that frank assessment, Yassin voices confidence in the resilience of a diaspora that has long been accustomed to hardship. “Somalis are used to such situations,” he says with a smile. “This is the way they were living for so long, so I think it will not have such a drastic impact on the psyche of the people. The [ticket] sales for summer are really going up… Still the people have a hunger to go back home to see their families.” Multi-pronged reforms were introduced in the wake of the attack, he confirms, explaining: “We have to continuously improve the security situation, and be proactive about it. [We have to consider] what could happen, where the threats may come from, how about [bombing attempts using] liquids, how about electronics. There are a lot of things now that everybody should look into. Not us only, but overall.” Daallo can count on strong allies in its endeavor to keep the skies safe. Along with AMISOM, the African Union mission in Somalia, the airline is cooperating on security matters with the Somali government and Favori, the Turkish company that operates Mogadishu Airport. YASSIN

“Flights may be a little bit difficult for the passengers initially, but everybody’s collaborating,” Yassin affirms. “This has been a wake-up call.” Frustratingly for his team, the bombing coincided with a crucial transition period at Daallo. The company last year ended two decades of rivalry with Jubba by merging under the banner of the Africa Aero Alliance – a newly formed entity that aims to bolster the fortunes of both carriers. Yassin believes it is not terrorism but foreign competition that poses the greatest threat to small African airlines like Daallo and Jubba. He is particularly concerned about the impact of the Persian Gulf carriers, which have sustained double-digit growth for more than a decade by developing vast hub-andspoke networks that suck up connecting traffic from every corner of the planet. To their supporters, Dubai’s Emirates Airline, Abu Dhabi’s Etihad Airways and Qatar Airways are models of excellence in the notoriously tough airline business. To their critics, they are anti-competitive parastatals that guzzle state subsidies and drive private-sector rivals out of business. “[They have] very huge capacities building up, so they need this capacity to go in every single space that they can find,” Yassin explains. “Africa seems to be an easier way to go because Africa is more free… but the question is how does this impact home-grown initiatives? “When a private company has been working on something for 25 years… and then all of a sudden a giant comes and pushes the small company out of the market, this has a very destructive impact on the economy of the country, on the employment of

“THEY [GULF CARRIERS] HAVE TO COME WITH A FORMULA THAT CAN CREATE SYNERGIES, THAT CAN CREATE A WIN-WIN SITUATION.”

As the Daallo-Jubba alliance shifts to an all-European fleet, it will begin scaling up operations with its own flight crew – boosting commercial stability and trimming costs for both carriers.

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Yassin believes it is not terrorism but foreign competition that poses the greatest threat to small African airlines like Daal- lo and Jubba.

the people, on the psychology and the business spirit of that country… They [Gulf carriers] have to come with a formula that can create synergies, that can create a win-win situation.”

HARMONIZED VISION

completed the first phase of their merger, Daallo and Jubba are now developing a strategic plan to unlock synergies and discourage internecine competition. “You can make two companies merge, but [deciding] how to make the new animal move in the way that you want, and [plotting] the destiny and the objectives – that’s more difficult,” Yassin says. “We have to harmonize the vision.” He hopes to begin expanding the Africa Aero Alliance next year, with Kenya, Rwanda, Uganda, and Djibouti considered prime targets. Another near-term objective is fleet standardization. Both airlines currently make use of wet-lease agreements, whereby foreign carriers provide aircraft and crew under a short-term contract. The approach entails a constantly rotating fleet and can push up costs compared to wholly autonomous airlines. At the time of writing, Daallo deployed three aircraft: one A320 wet-leased from Aerovista; one 737 wet-leased from Hermes Airline; and one fully-owned BAe 146. Jubba meanwhile deployed two Boeings, one Airbus and one Fokker. Both carriers will modify their fleets significantly over the coming months. The first step will be returning all of the Boeings along with the Aerovista unit, Yassin confirms. Hermes, the wet-lease provider that operated the bombed aircraft, has also decided to wind down its contract with Daallo. In its place, Greece’s Olympus Airways will provide two A321s. The Fokker 50 will then be withdrawn following the acquisition of two ATR 72 turboprops. H AV I N G

As the alliance shifts to an all-European fleet, it will begin scaling up operations with its own flight crew – boosting commercial stability and trimming costs for both carriers. Aircraft standardization will also drive network growth, with new services planned for Addis Ababa and Entebbe this summer. Daallo and Jubba presently operate from three bases – Mogadishu, Hargeisa, and Djibouti – flying internationally to Jeddah, Nairobi and Dubai; and domestically to points such as Bosaso, Galkayo and Garowe. Frequencies to Dubai and some domestic cities have already increased since the merger. Yassin says the Ugandan authorities have already granted traffic rights for Entebbe, but that the launch is being held up by perceived security concerns. When officials in Kenya voiced similar jitters about the Mogadishu-Nairobi route, they decided to mandate a stop-over in Wajir for additional screening on Kenyan soil. At some point European cities should also be restored to the network – Daallo formerly operated flights to London and Paris – though Yassin is reluctant to give timescales. “It’s a priority for us, especially stations like London, but the way things are right now I think we have to consolidate our regional operations first,” he admits. “Maybe one year could be the time that we can plan to start our operations to Europe.” Though Somalia can be the most unforgiving of markets for entrepreneurs, Yassin is keeping his foot on the pedal while showing that unity and cooperation is the best path for the continent. “Our philosophy is that Africans should put their forces together,” he concludes. “The East Africa community… should focus on how the infrastructure of the region can be integrated, and how collaboration can be achieved within the different sectors – especially airlines, which are a facilitator and a very important sector for economic development.” w w w. t h e c o n t i n e n t m a g . c o m

TRANSPORTATION | AIRFARES

FLYING TO ENLIGHTENMENT Airfares are set to slide, and this is good for business, writes J.A. Young

T H E C O S T O F flying in eastern Africa has traditionally been out of reach for most in the region. Yet economists agree that sustainable economic growth is, in large part, dependent on affordable air travel. Until recently, traditional airlines have been able to charge high rates because they face little to no competition and therefore no inducement for them to reduce their fares. Now that scenario is finally changing, thanks to emerging low-cost airlines such as Fastjet, Kulula, Mango, Fly 540, and JamboJet.

New airlines have faced tremendous difficulty due to government restrictions and the high cost of fuel. It took Fastjet three years to gain approval to fly from Tanzania to Kenya, a hurdle that is not uncommon in the region and elsewhere in Africa. Cross-border travel has been fraught with restrictions and this closed marketplace is a major dampener on continental economic growth. With few competitors, traditional airlines have been able to maintain their high pricing with no inducement to make adjustments to fares.

THE HIGH COST TO FLY

TRAVEL BETWEEN NATIONS

F LY I N G

WHY

throughout the continent has been expensive for decades. While reports suggest that flying in Africa has become safer and more commonplace, the high ticket prices have prohibited many from accessing this convenient mode of travel. Although many low-budget airlines have popped up to challenge the few traditional airlines, they have found it difficult to stay afloat in spite of the great demand. Failed carriers include Red Sea Air, Regional Air, Kencargo Airlines International, and Air Nigeria.

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is it so difficult to travel by air from one African country to another? Historically, airlines have required years of lobbying to gain government approval for the privilege of providing flights from one country to another, and even then, reports from news agencies such as TheÂ Economist have stated that approval sometimes requires outright bribes. The airline industry in Africa may be getting off the ground, but in many ways it is still fraught with overwhelming difficulties that prevent it from reaching its potential. Many aviation experts have asserted that

TRANSPORTATION | AIRFARES

misaligned government policies are at the heart of the industry’s problem, but addressing these policies with a view to changing them has been too daunting for the new low-cost airlines that have entered the playing field. Another problem for these airlines is the high cost of insurance. Even though many of the regions clamoring for cost reductions boast stability, insurers have been unwilling to reduce pricing because of earlier safety records and past regional instability. Some nations, like Zimbabwe, have been loath to allow travel to certain countries because they fear their jets will be impounded over debts to creditors. These difficulties make flying from one nation to another notoriously difficult – and expensive.

THE STATE OF AIR TRAVEL IN AFRICA

have suggested that simply flying from Cape Town to Lagos could see you “enjoying’” a stopover – and long delays – thousands of kilometers away in a city like Dubai. Many of Africa’s air travelers are forced to fly via the Middle East or other far-off destinations simply because there are no direct flights to their desired destination. The consequences for travelers are increased expenses and long delays. REPORTS

A GLIMMER OF HOPE

Fastjet, having recently gained approval to add new international routes to its flight schedule, is making some headway in its fight to promote low-cost air travel in the pan-African region. Some reports have suggested that the airline’s new routes could be a “game changer” and truly shake up the aviation industry in a real and lasting way. Initially, Fastjet was confined to operating in Tanzania, but in 2013, it was finally able to book its first flights to Johannesburg, South Africa. Its most recent expansion will see it fly from Tanzania to Kenya. Each new route brings with it tremendous opportunities for economic growth and aviation experts propose that it will force the monopolies to lower their costs and spur governments into loosening restrictions in order to benefit from the growth that other countries are beginning to enjoy. U K- B A S E D

FASTJET’S COMMITMENT TO LOW-COST AIR TRAVEL

in 2012, Fastjet is committed to offering affordable flights in the pan-African region with its no-frills flights and unique business model of establishing affiliates in other nations in order to circumnavigate the restrictions of flying from one African nation to another. While Fastjet Tanzania is its first LAUNCHED

branch, the company established a Zimbabwean branch last year and a Zambian branch is in the works. Currently, the airline boasts destinations in Tanzania, Kenya, South Africa, Uganda, Zimbabwe, Malawi, Zambia, and the Comoros islands. Although the airline is yet to turn a profit, it has been able to increase the size of its fleet, a move that has eastern Africa quite excited about its growth.

LOW-COST AIR TRAVEL AND BUSINESS GROWTH

eastern Africa’s emerging middle class is able to enjoy more affordable air travel, the impact for business and the economy will be great. Poor infrastructure has made travel by road difficult and with the exorbitant cost of flying, economic growth has been stifled – until now. With Fastjet offering considerably lower costs to fly, state-owned airlines must necessarily adapt to changes within the industry. Once the traditional airlines begin to lower their prices, increasing numbers of people will be able to fly and the great hope is that economies will prosper. East Africa has a great entrepreneurial spirit and its fast-growing cities are a definite indicator of their economic growth potential. Low-cost air travel can foster this economic growth if allowed to. AS

AS EASTERN AFRICA’S EMERGING MIDDLE CLASS IS ABLE TO ENJOY MORE AFFORDABLE AIR TRAVEL, THE IMPACT FOR BUSINESS AND THE ECONOMY WILL BE GREAT.

NAVIGATING THE CHALLENGES

the emergence of Fastjet is a sign of change for Africa’s aviation sector, more change is certainly needed on various fronts, including the high cost of fuel and restrictive government policies. Airlines are relying on governments to ease travel restrictions and lower fuel prices. In return, airlines must strive to improve their records and to meet global standards for safety and customer service. As always, the aviation industry hopes that governments, especially in the pan-African region, will recognize the part they play in the problem and work to achieve solutions that will benefit their local economies. For now, Fastjet is poised to become the continent’s largest low-cost airline. Many of its passengers are first-time flyers, but the hope is that flying in the region will ultimately become more commonplace, and certainly less of a luxury than it has been previously. When that occurs, the industry may yet prosper and local economies will doubtlessly share in its success.

WHILE

Young is a freelance writer with a background in academic libraries and medical research who has written extensively about Africa. w w w. t h e c o n t i n e n t m a g . c o m

The Continent: What measures are in place to ensure that agricultural development in Ethiopia is able to sustain itself in order to ensure food security and run in tandem with your desire for industrial expansion?

INDUSTRIALIZING FOR IMPACT

DR. ARKEBE OQUBAY Ethiopia, a largely agrarian economy, has been spearheading an industrialization drive for over a decade. While certain sectors of the economy still remain “off limits,” key areas are being incentivized and fast tracked for investors in purpose-built industrial zones. Dr. Arkebe Oqubay, Special Advisor to the Prime Minister of Ethiopia and author of Made in Africa, chats with The Continent about challenges with industrialization, and perceptions of the Ethiopian economy today 20

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O Q U B A Y : Ethiopia’s development strategy has focused on agriculture and smallholder farming for the last two decades, which has improved food security and reduced poverty. For instance, Ethiopia is in a better position to feed its population now than it was thirty or forty years ago, even though its population has more than tripled. We have been working to develop a resilient and transformed agriculture. Soil and water conservation, shifting from rain-fed to irrigated agriculture, and the promotion of improved technological practices and inputs, have all been part of our program. We have also focused on forest protection and afforestation schemes covering sizable areas. We have made some progress, but we need to scale up our efforts. With the increased impact of climate change, food security becomes a huge challenge. It has made rainfall unpredictable. Ethiopia is now promoting largescale industrialization parks – what are your specific objectives for these zones over the next five years? To emerge as a leading manufacturing hub in the region, Ethiopia has to promote investment,

ECONOMY | DR. ARKEBE OQUBAY

build many industrial parks, and focus on skills development. The development and use of industrial parks is one of our key strategies for economic transformation. It is important to mitigate the adverse environmental impact, promote economic use of our infrastructure, facilitate manufacturing investment, and promote linkages and â&#x20AC;&#x153;knowhowâ&#x20AC;? transfer. We need to build up to 10 million square meters of factory sheds in five years, focusing on key industries primarily in light manufacturing. The industrial parks will specialize in one, or only a few, related sectors. One-stop government service is to be organized in the parks to create an enabling environment. We have critically reviewed Asian and African industrial parks in order to learn from their experience. Many policymakers and practitioners miss the fact that industrial parks are not an end in themselves. Industrial parks need to be part of the broader industrial policy framework serving the industrialization strategy. It is also naive to assume they are the miracle medicine. Industrial parks have to be demand driven, and execution is as critical as the policy and plan. But this is easier said than done. To enhance our learning and experience, we are building a model Eco-Industrial Park in the city of Hawasa, which will specialize in apparel and textiles. The goal is to create 60,000 manufacturing jobs and earn US$1 billion in annual exports when the firms operate at full capacity. We will commence developing a few more industrial parks in six cities. Key industrial areas in the Ethiopian economy are still off limits to foreign direct investors â&#x20AC;&#x201C; when will there be expansion in order to allow penetration of foreign capital and interests in these areas?

T H E real facts are different from such perceptions, as Ethiopia already has a Foreign Direct Investment (FDI) friendly policy. FDI can participate

in almost all areas, and there is no restriction on 100 percent foreign ownership; and we offer generous incentives. The only exceptions are the telecoms and banking sectors. We do not yet have the capacity to regulate foreign banks and we want our banks to grow. We use returns from the telecoms business to expand our railway network, which is critical to local and foreign firms. Ethiopia

transformed our technical colleges and universities based on the German system. For instance, currently 70 percent of university courses are in natural science, technology and engineering. We have a university student population of about half a million, and more than 1,300 technical schools that can train up to one million students annually. This is a work in progress, and

ETHIOPIA IS IN A BETTER POSITION TO FEED ITS POPULATION NOW THAN IT WAS THIRTY OR FORTY YEARS AGO, EVEN THOUGH ITS POPULATION HAS MORE THAN TRIPLED. was among the top-five FDI African destinations in 2014. We expect rapid growth in the coming years as we have made many changes in institutional settings. At present, we are focusing on attracting manufacturing investment, targeting the major origin countries and leading firms. Industrial parks will play a critical role in this. How would you hope the manufacturing bases in Ethiopia will expand to grow and influence indigenous ventures, and home grown entrepreneurs?

domestic firms will learn from leading firms in developing management skills, technological and marketing capabilities. In the context of slow global economic growth, competing and improving our participation in the global value chain is increasingly challenging. Domestic firms may be linked as sub-contractors, and increasing use of domestic inputs improves local content. We also have support schemes to develop domestic firms. Our skill formation infrastructure, including technical schools and universities will accelerate the dynamics of spill-over effect. We have made huge expansions and

OUR

we have huge challenges in terms of quality and making it demand driven. Such transformation is an enormous challenge, but it all boils down to skills development, steady improvement of productivity and innovation. What specific plans/policies can be instituted to integrate transfer technology and educational initiatives from international companies and investors to Ethiopians?

we will focus on attracting leading firms and internationally competitive firms. Learning from the best is more rewarding than learning from the average performer. We must put in place incentives and sanctions that will shape the behaviour of firms, both foreign and local. Learning requires discipline and incentives have to be linked to performance. Focusing on exports puts huge requirements and pressure on firms. The ultimate test of competitiveness is being able to succeed in the international market. We will promote higher education and technical skills linkage with industry, and training by firms is central to know-how transfer. In brief, skills development and know-how transfer requires a strategic approach.

F I R S T,

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TECHNOLOGY | 3D PRINTING

3D PRINTING THE FUTURE From prosthetics to construction materials, 3D printing offers an opportunity to accelerate Africa’s manufacturing sector. But will high costs and resistance to change doom this technology before it takes off? Jeremy Daniel explores man growing up in Zimbabwe, Blessing Makwera could not have imagined the direction that his life would take. At the age of 14, he found a landmine detonator in a field and, thinking that it was an electric motor, tried to use his teeth to get it working again. The detonator blew up and ripped apart his mouth and jawline. In previous generations, a man with few financial resources such as Blessing would have had to endure this disfigurement for life. But the advent of affordable 3D printing, coupled with the dedication of organizations like Operation of Hope and the Sharp Memorial Hospital, came to his aid. A US firm called 3DSystems heard Blessing’s story and printed a reconstructed mandible (lower jaw) and a reconstructed maxilla (upper jaw), fibula cutting tools, as well 3D models that were used as reference tools during the 12-hour long operation. After a few months of recovery, Blessing was able to eat, talk, laugh, and plan for a normal life. AS A YOUNG

AFFORDABLE PROTOTYPING

few years ago, 3D printing was an idea you would only read about it in science fiction. Today, it is inching ever closer to the mainstream and could represent the next great business disruptor. The manufacturing sector in Africa A

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represents only a fraction of global output. Decades of investment would be needed for it to catch up with the rest of the world. But, in much the same way that mobile phones were able to deliver modern communication potential to the content and provide a springboard to progress, so 3D printing represents an opportunity to fast-track and develop the manufacturing sector at a rapid pace, and that process has already begun. “One reason for Africa’s marginal role in the global product market is the lack of access to machine tools for prototyping,” writes Dr. Calestous Juma, a professor at Harvard Kennedy School specializing in technological innovation and entrepreneurship for development. “As 3D printing takes off, African firms should be able to hugely reduce the time and cost needed to get from design and prototyping to the manufacturing stage of product development.’’ One of the companies making headway in this regard is Kenya-based 3D Life Prints. According to founder Paul Fotheringham, the company “saw on a daily basis the number of disadvantaged amputees, and then saw an opportunity to combine 3D printing technology in order to provide very low cost prosthetics, manufactured in the country of interest.” To date, 3D Life Prints has created over 100 prosthetics for amputees all over Sub-Saharan Africa.

FROM PROSTHETICS TO HOUSING

interventions have been a great entry point for the fledgling 3D printing industry in Africa, but they are far from the whole story. Agricultural products are high on the list of priorities. From simple tools like shovels and apple pickers to more complex drip-irrigation spigots and chicken feeders, huge potential exists for tools that are specifically created for the local conditions in which they are to be used. And because 3D printing is an additive rather than a subtractive process, the environmental impact is considerably smaller than traditional production of these kinds of tools. “3D printing can enable rural women to rapidly prototype agricultural tools adapted to their culture, cropping systems, and environments,” explains Juma. Access to the tools and education around the sector is critical. TanzICT is an information sector project in Tanzania that runs a tech hub called Buni, where interested learners are encouraged to start experimenting with 3D printing. The sessions are free and are vital for young Tanzanians to demystify the technology and begin to imagine how to incorporate it into Tanzanian life. On a larger scale, housing is one area of the economy where people see tremendous potential for 3D printing. Sally Murray is a country economist working for the International Growth Centre in Kigali, Rwanda. “3D printing might make quality, legal housing affordable for people living in poor urban settlements,” she argues. “Printers can use cheaper, novel materials — recycled construction waste, or even clay and plant seeds — and also make possible more innovative, less material-intensive designs.” When asked about what sectors 3D Life Prints plans to move into, Fotheringham says he imagines a future where parts for automobiles, aeronautics, physical models for architecture planning and iteration, and medical models for education and pre-surgical assessment and planning are an accepted part of the 3D printed landscape. MEDICAL

Left: 3D printing may offer an opportunity to fast-track the manufacturing sector. Top right:

3D PRINTING ON AN INDUSTRIAL SCALE?

the big question on everyone’s lips is whether this fledgling technology can develop from the niche prototyping that it is currently succeeding at, into an affordable manufacturing sector that has a transformative effect on the continent. Unfortunately, the broad consensus is that this is not possible at the present moment, for a variety of reasons. The chief stumbling block is around the prohibitive costs of the technology. The setup cost for a 3D printer with industrial capabilities is well over US$65 000 for the machine, plus the exorbitant cost of shipping, as well as excise and duties. In addition to the printers, the price of materials used in the process has risen by over 40 percent in 2016 alone. African distributors of industry-grade 3D printers would make a big difference, but at this stage they don’t exist. The ‘’adverse power conditions” are also an issue, according to Fotheringham, and fluctuating power and frequent power outages can have a detrimental effect on such sensitive machinery. BUT

Fotheringham also cites a resistance to change and to new technologies. “Lack of understanding of the complexities of 3D printing related to environmental conditions is an issue,” he says. “For example, if you put a 3D printer into a village in South Sudan it is unlikely to be working one year later. If it breaks, how do you get spare parts?” While the costs are likely to come down over the medium term, these questions require an answer before 3D printing can become the juggernaut that its potential shows it to be. David French lives and works in Rwanda for JSI, a general construction company that manufactures small, affordable houses in short periods of time at affordable prices. He’s seen the benefits of 3D printing when it comes to modeling, but is skeptical whether it will ever take off at scale in Africa, particularly in the construction industry. “It works really well in a controlled environment where you have perfect materials, but right now, here, it’s not going to work,” he insists. “We don’t have perfect concrete for one thing, and the conditions are not ideal. But somewhere in the future,

“3D PRINTING MIGHT MAKE QUALITY, LEGAL HOUSING AFFORDABLE FOR PEOPLE LIVING IN POOR URBAN SETTLEMENTS,” SAYS SALLY MURRAY, RWANDA COUNTRY ECONOMIST WITH THE INTERNATIONAL GROWTH CENTER

Michael Richards and Paul Fotheringham of 3D LifePrints meet the recipient of a 3D-printed hand. Bottom right: 3D Life Prints has crated over 100 prosthetics for amputees.

there’ll be a compromise between laser printing and 3D technology, and that could be the breakthrough.”

WHAT THE FUTURE HOLDS

industry players agree that in 5 to 10 years’ time, thing will look very different. And because Africa currently has a limited manufacturing sector, the disruption would be minimal and the new sector easily embraced. For African countries, many of which boast economies built on extracting natural resources, this technology should be a major blessing and a chance to fundamentally rewiring their economies. The key to realizing a 3D printing future that will disrupt the manufacturing sector seems to be to invest early, to educate the population around the potential so that they are ready when the technology is ready, and wait until it is affordable enough to transition into an industry that can scale and deliver to the people of Africa. MOST

Daniel is a freelance journalist living in Cape Town, South Africa who writes primarily about the disruptive power of mobile technology on the African continent. w w w. t h e c o n t i n e n t m a g . c o m

Breaking Barriers. Three women share their stories of succeeding in male-dominated industries, as told to Anthea Rowan

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WOMEN | BREAKING BARRIERS

any women across Africa and the world face limitations on their careers and economic success. Despite their own innovations at local level, women often find it difficult to access the same opportunities as men; sometimes because of cultural beliefs, sometimes because boy children are given priority in education, and sometimes because social structures prevent them from exercising their rights. Of those who do break through these barriers, many become incredible role models for other women in their communities. Although most countries in Africa have laws to protect women’s rights,

implementing these in reality is a challenge. Annie Nyaga, a successful farmer from Kenya, Angel Vendeline Namshali, camp manager at a mobile, high end camp in the Serengeti in Tanzania, and Fatma Juma Haji, a solar electrifying engineer from Zanzibar, are breaking the mould and forging a path in positions traditionally held by men, demonstrating that not only are Africa’s women increasingly empowered, but that with the right opportunities and support, those jobs aren’t exclusively for the boys. These are their stories.

FATMA JUMA HAJI Solar Electrical Engineer, Zanzibar F A T M A H A J I I S 50. She lives in a small village on the island of Zanzibar. She has no formal education and until a few years ago, when she left Zanzibar to train in India, she had never been beyond her island’s shores. She was selected by her community as part of an initiative driven by Barefoot College, an Indiabased organization with the mandate to empower women who have never been to school before.

a small village called Kandwi on the island of Zanzibar. I was incredibly lucky as in 2012 I was selected by my village through a Barefoot College initiative to travel to India and train as a solar engineer in Barefoot’s campus in Tilonia. Barefoot is a voluntary organization that works to empower illiterate or uneducated women worldwide. I never went to school and before I went to India I could not read, write or speak English. Now I can do a little of all of that. And I can light up a house with solar power. I had never left my island before I went to India. I was both very afraid and very excited. All the women who travelled with me were from Tanzania and Zanzibar. I loved being amongst women from different parts of the world and learning, not just about solar, but about the lives of women from all over the world. My husband was anxious before I left. It was difficult for him to give me I COME FROM

Haji, second from right (in orange) with a group of local women

permission to travel to India, but as he grew to understand that I would gain a skill and be able to work, so he was able to encourage me and give me his blessing. I spent six months in India and though I missed home and though it was hard to be so far from my friends and family, I never forgot what an incredible opportunity it was. It has changed my life. I returned able to fit a house with solar energy, my husband and nephews and nieces weren’t just proud of me, they were delighted to have a home with solar power, which I installed! I love putting the solar systems together! Villagers are fascinated to see the system take place, to see me on a roof fitting panels. I love arriving in a village at night and noting all the homes I’ve given light to. I feel excited when I unpack a solar kit. I’d love to learn how to make the panels too. As well as working as a solar electrifying engineer, I also work at Barefoot’s training center on Zanzibar

“THERE ARE NO SPECIFIC JOBS FOR MEN OR WOMEN IN THIS WORLD, ONLY JOBS FOR EVERYBODY.” now. The program is called Wanawake Kupanda, which in Kiswahili means “Women Rise.” That is what Barefoot is all about; promoting women, elevating their status, and helping them to grow. I work as a Master Trainer there, teaching other young women about solar power. We train fifteen women every six months for six months. There are no specific jobs for men or women in this world, only jobs for everybody. Women just need the opportunities and the training and then they’ll be just as able to do the same jobs as men.

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ANGEL VENDELINE NAMSHALI Manager, Dunia Camp, Tanzania A N G E L N A M S H A L I I S 35. She was thwarted in her desire to go to university as her parents lacked the funds to support her. Instead she has forged a successful career in Tanzania’s tourism market. She earned her stripes in an apprentice capacity, mentored by those who noted her ability and her energy. She is one of the few – if not the only – female Tanzanian camp managers in the Serengeti; she manages Asilia’s high end Dunia Camp.

to university. I would have loved to. I did well at school, I won a scholarship and was selected to go to university but my parents couldn’t afford it. I was one of six children. My dad sold a cow to try to raise the funds to send me to University in Dar es Salaam, but he opted to rather pay my younger brothers’ school fees. There was no money left over to send me to university; I was devastated. But it did not mean my parents believed in me less, they have always been encouraging and are very proud of me. I learned my profession on the job, working my way up from a young girl who organized lodge linen to the manager of one of the Serengeti’s most prestigious mobile camps. I was fortunate to have managers and mentors who spotted my enthusiasm and my ability and gave me opportunities to progress my career in an industry that remains male dominated. Women are considered to be inferior to men in Tanzania; few men believe that a woman is capable of leading a group, especially one in which men are involved but that’s exactly what I do. I am the only woman amongst a camp staff of 25. There are not many women employed in tourism – and especially in the national parks. Most women in this sector work I NEVER WENT

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April 2016

in city hotels, not as managers in lodges or camps in the bush. And those who dare to live in isolated bush camps don’t stay long. I have been lucky, but that’s not to say my journey has been an easy one. I have received abuse and even been

“IT WAS DEMORALIZING WHEN PEOPLE SUGGESTED THAT IT WAS WRONG OF ME TO LEAVE MY FAMILY BEHIND AND GO OFF TO WORK IN PLACES WHERE I AM ONE OF VERY FEW WOMEN.” threatened. And it is hard to relocate to a remote camp for months at a time as I am married with a son. It was demoralizing when people suggested that it was wrong of me to leave my family behind and go off to work in places where I am one of very few women. It was hugely challenging at first to manage a team of older men. Although we were all Tanzanians, we still came from different ethnic and cultural back-

grounds. I had to practice patience and perseverance and grow a thick skin to do my job. Increasingly, the government is working to promote women in the industry and the safari operators and lodges are beginning to understand the value of female employees and are developing initiatives to employ and mentor them. There are opportunities in this sector, yet there are still very few women driver-guides, very few head chefs and managers. But the more women get involved, the more people will understand that they can do the same jobs as men. By extension, this will mean better lives for the families of those women and there will be more money to educate their own children for whom they will be providing positive role models. One day I imagine myself as the MD of a big tourist operation in Tanzania – or Africa. Simultaneously, I want to become engaged with ensuring that underprivileged women and children are mentored to believe in themselves and prepare themselves for challenging roles. It’s a responsibility I have already begun to assume in my own community where, despite early doubt and suspicious, I am now highly regarded.

WOMEN | BREAKING BARRIERS

ANNIE NYAGA Founder, 4H Kenya Foundation, and Owner, Farm2Home Ltd., Kenya A N N I E N Y A G A I S a successful 29-year-old farmer who began her business, farm2home, in 2009. Nyaga, who grew up on a farm where she witnessed her parents’ success as farmers, began by growing produce for the export market but abandoned that when she became frustrated with price fluctuations. She decided to concentrate on watermelons and hasn’t looked back since.

to come from a family of men who empower women and to have a husband who has supported me. Not all women have either that kind of support or access to land and capital. We have come a long way in empowering women with education, but there are still gaps in land ownership. Men are still in charge, and women still have to submit to the will of the men in their lives in order to I AM LU CKY

benefit from what is rightfully theirs. Although the Kenyan government has done a lot to protect women’s rights, women are still at the mercy of men, due to ignorance of the law; a lot of women don’t know the laws have changed to protect them and that they have a right to refuse to allow their land to be held as collateral. Accessing loans is harder for women than men; women are still seen as a “risky” investment despite evidence to show women are less likely to default than men. Banks only begin to notice women once they have built a good reputation and created large, active accounts. The fact remains that numbers are seen as a “boy’s game” and if girls don’t fall in love with mathematics and science early, they will always relinquish the important tasks of wealth creation and wealth management to men. Agriculture is the biggest sector of the Kenyan economy; it’s a profession of hope and a way of life. But our colonial history left us with bad attitudes towards farming; because our grandparents had to work for white settlers, we came to associate farm work with slavery, and at independence, everyone who was

educated wanted blue- and white-collar jobs. That’s changing slowly – especially for women; the World Bank estimates that 80 percent of the agricultural sector is controlled by women. The problem is that as you start climbing the ladder to more capital-intensive agri-businesses, you find fewer and fewer women. The women who grow coffee and tea in our highlands do not have the title deeds to the land. The deeds are in the name of the men in their family. So even if they have a good idea to expand the business, they cannot speak the language of the banks. Access to credit is the glass ceiling for women in agriculture. I am investing in the next generation. To make an impact, you have to start at the roots. More than a century ago, it was the youth who revolutionized the agricultural economy in the United States; it began with changing the attitudes of the young towards agriculture. When

“ACCESS TO CREDIT IS THE GLASS CEILING FOR WOMEN IN AGRICULTURE.” it dawned on the government that food production was falling because of an aging farmer population, a movement called 4H – Head, Heart, Hands, Health – was initiated. Today we are driving the same movement in Africa. I am heading the Kenyan movement through the 4H Kenya Foundation, different organizations are doing the same thing across the continent, in Ethiopia, Tanzania, Uganda, Ghana, Liberia... We are encouraging the young to see opportunities in agriculture. And we want girls to be a part of that movement; we are encouraging them to take up science and mathematics and assuring them they can be industry leaders too. Rowan is a Nairobi-born freelance journalist based in Western Tanzania. w w w. t h e c o n t i n e n t m a g . c o m

SOCIETY | GAMBLING

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BUSINESS | JAMILA ABASS

BUSINESS JAMILA ABASS

INSPIRATIONAL INTELLIGENCE Jamila Abass’s mobile platform is helping thousands of farmers make better market decisions. In an interview with Reuben Kyama, she shares her own experience of starting a business – from failure to fame – and makes the case for more data in agriculture

amila Abass, 32, describes herself as a technology enthusiast. The chief executive and founder of M-Farm, a technology-based company which empowers smallholder farmers and traders in Kenya to communicate among themselves and share knowledge, says the lack of education is a key deterrent to Africa’s development. “The number one thing that you battle constantly is the mind shift,” she said recently in an exclusive interview with The Continent, while on the sidelines of an international business and investment forum in Sharm el Sheikh, Egypt. “It’s easy to convince an educated farmer to adapt to new technologies, and to see this as a business. But for the older generation, it is really difficult because they are used to doing things in a certain way.” The Kenyan-born entrepreneur says she wants to empower thousands of smallholder farmers in East Africa to move in to commercial farming, by leveraging mobile technology to access real-time information and incentivize collective action.

“M-Farm is a platform that enables smallholder farmers and traders to make informed decisions, to connect with each other and connect with the market as well as exchange knowledge [peer-topeer information] among themselves,” she explains. Through her innovation, Abass has been able to reach out to some 20,000 subsistence farmers and enable them to improve their livelihoods by accessing new markets and planning ahead. “The farmers in Kenya right now are planting without knowing what the market needs, without knowing how much it needs and what they can get [fetch] from the produce when it’s ready,” she says. “We have business intelligence tools for farmers and traders to plan ahead – and make sure they know exactly who’s going to buy, when it’s going to be bought and when is the best time to

plant so they can benefit from the good prices.” Born into a family of 15 children – 6 sisters and 8 brothers – Abass grew up in Wajir, northern Kenya, a volatile region close to the Kenya-Somali border. She came up with the idea of M-Farm five years ago and has not looked back since. “The idea came to me and my co-founders at a time when there were reports about farmers being exploited [in the marketplace],” she recalls. “Then, we realized that we had a skill for gathering and analyzing data and providing the right information.” She saw an opportunity from this challenge and quickly identified a solution. “We translated it as having been [as a result] of an information gap between the farmers and the market,” she points out. “And, having a background in IT,

“I CAN’T SAY WE HAVE TRANSFORMED THE AGRICULTURAL INDUSTRY ENTIRELY BUT I SURE KNOW THAT WE HAVE CHANGED SOME FARMERS’ LIVES.”

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BUSINESS | JAMILA ABASS

we thought coming up with an information technology platform for farmers where they could get all the information they required would solve part of the problem that they were facing.” Today her innovative work has propelled her into the limelight. In July last year, US President Barack Obama praised the young female innovator for her efforts to improve the lives of smallholder farmers and provide access to current market prices of various crops across East Africa’s leading economy and possibly throughout the region. Obama, who was on an official visit to Kenya to co-host the sixth Global Enterpreneurship Summit, said he was “hopeful because of the young woman.” “M-Farm makes it easy for farmers to get information that lets them match their crops with what the market demands,” said the US leader. Obama said studies had shown that the technology platform enabled farmers to double their sales. Abass says she is ever grateful

to President Obama. “It felt really good,” she says, referring to Obama’s much-publicized approval. “I can’t say we have transformed the agricultural industry entirely but I sure know that we have changed some farmers’ lives,” she adds. Obama’s words of praise raised M-Farm’s profile considerably. “A lot of people began subscribing to our platform, [and] many people [started] contacting us, like local governors who never knew about M-Farm,” she says excitedly. “We got calls – they are interested in implementing it in their counties. That was really positive.” Abass is also helping farmers and traders in the region to bolster their

“WE ARE WOMEN IN TECHNOLOGY AT THE RIGHT TIME WHEN THE WORLD IS LOOKING AT WOMEN IN TECHNOLOGY IN A POSITIVE WAY, IN A WAY THAT THEY WANT TO PROMOTE, IN A WAY THAT THEY WANT TO SUPPORT…”

Through her innovation, Abass has been able to reach out to some 20,000 subsistence farmers

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bargaining power and business planning skills. Using their cellphone handsets, farmers can send simple inquiries and gain access to real-time price information available in the market. For smallholder farmers who usually have low volumes, accessing the markets has been a constant logistical hurdle. But now there is a solution. “What M-Farm does is it connects [these] farmers to each other so that they can pull their resources [together] and have bulk produce and access bigger and better markets,” she says.

SOCIETY | GAMBLING

“Basically, it’s a marketplace that encourages collective action among the farmers based on region, based on the crop that they are selling, and based on the availability or when the crop is going to be ready,” Abass says, adding that farmers who have experience in certain crops advise others on the same platform. In addition, graduates from agricultural institutions of higher learning are able to share their research findings online with the farmers. Since its inception in 2011, the platform has attracted more than 20,000 farmers to date.

“WE FAILED AND THEN WE RESTARTED”

Abass, just like many entrepreneurs, starting off her business was not an easy ride. “We have faced a lot of challenges. I actually say ‘we failed at M-Farm and then we restarted,’” she opens up jokingly. “The reason is when you start a venture like this one in the beginning, you think ICT is it – it’s going to be the silver bullet that is going to take all the pains away from the farmers and all the headaches from the supply chain – but then you realize that for ICT to work, we need to have a working infrastructure,” she adds. “For example how do you make sure that farmers are able to connect with each other and be transparent and the deal will go smoothly without other farmers dragging each other down?” she says. “So, along the way in our business we realized that we couldn’t solve all the problems in the supply chain. We can only solve one part of it, which is the communication level.” FOR

WOMEN IN TECHNOLOGY

says that being a woman in technology has been a blessing in disguise for her. “We are women in technology at the right time when the world is looking at women in technology in a positive way, ABASS

in a way that they want to promote, in a way that they want to support… So in that regard, yes, I am lucky to be a woman in technology today.” Abass says wearing a hijab – the Muslim headscarf – has never been an issue. “I think Kenya is pretty much easy. It’s a country with a lot of diversity in terms of culture and religion. Nobody wonders why I am wearing a hijab. Nobody cares actually inside Kenya, maybe outside Kenya.”

NEXT STEPS

A B A S S laments that many African governments have not done enough to support smallholder farmers who make up the great bulk of the population. She says, as a result, the farmers lack basic education, which would otherwise enable them to adopt new technologies. “It’s a shame that we don’t have accurate and actionable information on the agriculture industry,” she says. “If you ask any African government how many farmers are in their country, it will be guesswork. Nobody will tell you for certain that we have x million farmers in this country.” The data enthusiast says her vision is to ensure that “we put Africa on the map” by gathering and providing accu-

“It’s a shame that we don’t have accurate and actionable information on the agriculture industry,” says Abbas.

rate information that is actionable for governments, farmers, and traders. When asked what else farmers need for empowerment, she quips, “Education, education, education!” Abass believes that agriculture is likely to drive the continent’s economic growth if investments into the sector are scaled up. “Agriculture is food – [this is what] we are talking about – we eat every day. If we want to move at lightning speed then we have to invest in the industry so that change can happen sooner than later.” What is her message to African leaders and smallholder farmers? “I would say data is the new currency,” she says, adding that in today’s world there is an urgent need for all to adopt new technologies to better our livelihoods. “We are in a world where we have satellites that can tell you for sure this is a farm, it has maize and it has this amount of maize,” she explains. “We are living in that world, why are we behind?” Kyama is a Nairobi-based journalist and a Fellow at the Africa Leadership Initiative Media Fellowship program. w w w. t h e c o n t i n e n t m a g . c o m

ALL BETS ARE ON SOCIETY | GAMBLING

As Kenyans from all walks of life embrace sports betting as a way to generate income, it is racing off to become the countryâ&#x20AC;&#x2122;s next multimillion-dollar industry. Despite the risks, payouts as large as US$300,000 are making the habit more and more enticing, writes Munene Kilongi

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SOCIETY | GAMBLING

crowded table surrounded by noisy soccer fans, Wachira Mwangi cuts a lonely figure at Ben’s Bar in the Buruburu shopping center, a middle-class neighborhood in the Eastlands district of Nairobi. Under the grey skies, the busy streets usually filled with revelers are deserted as one of the biggest games in world football kicks off. It’s a top-of-the-table premier league clash between English giants Chelsea and Manchester United that has seen the regular human traffic migrating into the numerous pubs in this busy shopping area. There are only men at the bar; some standing while others are seated. Mwangi’s elbows dig hard into his knees, arms stretched outwards cradling a phone directly on his face. He squints in deep concentration at the small screen that is the focus of all the attention. As the game ends, he begins muttering excitedly to no one in particular before breaking into a broad smile, standing up, and hoisting his hands into the air. “Three of the five teams I bet on have now won their games,” he says, smiling nervously. “Two to go.” If Mwangi is lucky today, he might pocket KES 10,000 (US$100); or, he may lose his bet of KES 100 (US$1), which, to the 40-year-old unemployed technician, is a fortune. Mwangi is one of an estimated three million Kenyans who have recently turned to gaming as a source of livelihood. From rural villages to the slums of Nairobi, thousands of jobless men and women with no formal source of income are registering in droves with the numerous betting companies popping up all over the country. SITTING AT A

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SOCIETY | GAMBLING

Sports betting is the new addiction in town and many are thanking their lucky stars for the chance that this income generating activity affords them. With a 40 percent unemployment rate and a debilitating high cost of living, this “business unusual” has attracted an eclectic mix of “investors” that includes college kids, lonely housewives, the idle and restless, as well as white-collar and blue-collar workers. It seems everyone wants a shot at getting lucky. All one needs to get in on the action is to register with a betting company then top up some cash on their virtual wallet and pay through mobile money transfers. These kind of transactions are second nature to Kenyans. “Yesterday I made K E S 7,0 0 0 b o b (US$70),” says Tim Makau, 23, an accounting student. “I used my lunch money to bet and now I have enough funds to take my girl out on Valentines weekend which would not otherwise have been possible,” he says. Makau

has had some good days, but has also lost substantial amounts of money. But today, he’s not risking anything until after Valentines has come and gone. In a conservative society such as Kenya where gambling is frowned upon and is seen as a vice for the well-to-do, the response to the sports betting trend has been phenomenal. Neighboring East African nations have been sports betting for more than a decade, but in Kenya it has taken off so explosively that the twoyear old Sportpesa betting firm, is now the biggest sports betting firm in all of East Africa. In Kenya, the focus is on football, the English premier league, in particular, which has a large following. Predicting which team wins has become a roaring business. A few meters from Ben’s Bar is Eazi Bet, a swank shop that looks like a pimped-out cyber café. A sizeable crowd is milling around several big screens on every corner that are broadcasting live football matches and virtual horse racing. The eager punters surround

“PREVIOUSLY, MY WIFE COMPLAINED THAT I SPENT TOO MUCH TIME ON FOOTBALL, BUT NOW I SOMETIMES RETURN HOME WITH A FULL SHOPPING BASKET FROM MY WINNINGS WHICH HAS MADE HER TOLERANT.” TOM ODUOR

the counter to make bets while some furiously drum on computer keyboards researching for the right bet. Nicholas Muhindi fidgets nervously as he sits behind a computer at the Eazi Bet parlor while researching which teams to bet on. The 41-year-old father of two is a trained chef but has been out of work for years. Betting has become his sole source of income. “I’m here from Monday to Monday to make bets,” he says. “I make some substantial amounts of money. At least I am never broke.” “Some months I make more money than an average employed person (U$300),” he adds. “It’s the input and seriousness you put in. It’s not just about luck, you have to analyze teams and follow your instinct.” For as little as KES 100 (US$0.20), a person can bet on the outcome of several matches. At Eazi Bet, the highest potential payout is KES 2 million (US$20,000), but the highest amount won thus far is US$2,000. The previous week Muhindi won US$570, though the largest amount he’s earned in one sitting is US$1,100. He is open to employment but insists he’ll continue betting because “it’s in my blood.” The single largest payout to be won so far in the country stands at roughly US$300,000. It was 27-year-old Elizabeth Khanaitsa’s win that kicked off the boom. Her jackpot prize of KES 22,049,424 (US$220,000) through Sportspesa last year has encouraged a flurry of potential risk takers. Khanaitsa, is an unconventional gamer with rudimentary football analytical skills, but against the odds she correctly predicted 13 winners from various leagues around the world. Her win provided massive incentive to skeptics who thought only adept football fans could crack it. For Tom Oduor, a businessman in his mid thirties, betting is a hobby he engag-

Wachira Mwangi at Ben’s Bar. Mwangi is one of an estimated three million Kenyans who have recently turned to gaming as a source of livelihood.

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SOCIETY | GAMBLING

Left: Tim Makau focuses intently on his mobile at Ben’s Bar. Right: Wachira Mwangi at Ben’s Bar. Bottom left: Ncholas Muhindi tracks his winnings at Eazi Bet

es in twice a week. He’s browsing through the web at the Lucky 2 U betting parlor analyzing teams and player statistics, before making his bet. “Previously, my wife complained that I spent too much time on football, but now I sometimes return home with a full shopping basket from my winnings which has made her tolerant,” he says. Oduor has been gambling for a year. The highest amount he has won is US$300 while the most he has lost is US$75. The sports betting craze in Kenya has led to over 23 betting firms registering in the last two years, and a slew of others waiting in line for full registration. International betting firms like the British Betways and Greek gaming company Intralot have also come in for a piece of the action. Intralot in partnership with local investors has splashed US$15 million and goes by the moniker mCheza Bet. The treasury took note of the huge interest generated by this new trend and quickly cobbled up a tax regime on winnings from sports betting in their budget last June. Betting firms now pay between 5 and 12 percent on gross earnings. The country’s Sports Cabinet Secretary Hassan Wario says the industry’s

actual monetary value has not been formally evaluated but will run into billions of shillings if properly exploited as it has yet to reach the tipping point. Sports betting in Kenya generated more than US$20 million in 2014, according to a report by accounting firm PwC. It further reports that Kenyan, Nigerian, and South African markets are expected to be worth US$37 billion by the year 2018. Early this year, Sportpesa bailed out two of the country’s leading football teams; Gor Mahia with a US$700,000 a year deal and AFC Leopards with a fiveyear deal worth US$450,000 annually. They are also sponsoring the country’s premier league, the Sportpesa league, to the tune of US$4.5 million. There have been recent news reports of a worrying trend where young men and women are dropping out of formal employment to engage full time in betting which they find more lucrative. In response, big companies like Sportpesa have capped the highest amount one can bet to KES 20,000 (US$200) so that addictive punters don’t sell their family valuables to play. But most Kenyan gamers are careful about going for the jackpot which

requires one to accurately predict the outcome of 13 games often played on different continents. Most engage with obscure second-tier and thirdtier leagues. And the few who have been lucky have made off with sums of between US$15,000 and US$50,000. The beauty of sports betting is that payment is immediate, which breeds trust and convenience. You can also make bets from the privacy of your home if you have a smart phone and an internet connection. As the Manchester and Chelsea game comes to an end there are whoops of joy from a few individuals as they rush out to redeem their winnings, while a few crestfallen others wrap their arms around their heads mourning their losses. Mwangi, who is unaware the game has ended, mumbles to himself then scratches his beard in consternation before shrugging his shoulders. “Whatever the outcome of this fourth game at least I have made different bets with two other gaming companies,” he says. “I’m optimistic I am not going home empty-handed.” Kilongi is a freelance writer and videographer based in Nairobi. w w w. t h e c o n t i n e n t m a g . c o m

FINANCE| BANKING

Patrick Ngugi Njoroge, Governor, Central Bank of Kenya

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FINANCE| BANKING

CLEAN SWEEP T H E P L A C I N G O F Kenya’s mid-tier Imperial Bank under receivership in October last year sent shockwaves through Kenyan society, but ultimately it may come to be seen as further proof that the banking sector is vibrant and becoming better governed. The receivership should be seen as part of a “new broom sweeping clean” rather than a weakening of the banking sector, according to Anne Muchoki, the Chairperson of KenInvest, speaking to African Banker at the time of the announcement. During the era of former Central Bank of Kenya (CBK) Governor Njuguna Ndung’u, from 2007 to 2015, not a single bank was put under liquidation. While he is credited with establishing a robust regulatory framework, his governorship was better known for innovations like agency banking and mobile money services rather than enforcement of regulation. Now, the placing of Imperial Bank and Dubai Bank Kenya under statutory management by the new CBK Governor Patrick Ngugi Njoroge is a significant indicator that Kenya is intent on cleaning up its banking industry. Immediately after taking office on June 19, Yale-trained economist Njoroge wasted no time in singling out “rogue institutions” in finance which manipulate forex and money markets through collusive behaviors. He warned then that there was a need for proper adherence to the rules by financial institutions and greater oversight on dealers, and has moved

While the Central Bank of Kenya’s decisions to close Imperial Bank and Dubai Bank Kenya means short-term pains for small- and mid-sized financial institutions, the move is a sign the system is working, rather than not, comments Eamonn Ryan

THE PLACING OF IMPERIAL BANK AND DUBAI BANK KENYA UNDER STATUTORY MANAGEMENT BY THE NEW CBK GOVERNOR PATRICK NGUGI NJOROGE IS A SIGNIFICANT INDICATOR THAT KENYA IS INTENT ON CLEANING UP ITS BANKING INDUSTRY.

firmly to enhance supervision and curb indiscipline. In December, the CBK further announced an indefinite suspension of the licensing of new banks, an order which it said it would reconsider at a later date. In a statement released on its website on October 15, the CBK reassured the public that the placing of Imperial Bank under receivership would not affect the broader banking industry. Indeed, Imperial Bank directors expressed interest in recapitalizing the bank to facilitate its reopening. Njoroge said the lender, with KES 58 billion in customer deposits represents barely 1.8 percent of the sector, and was therefore not a matter of concern. The banking sector, he insisted, is “safe and robust.” “CBK stands ready to use all instruments at its disposal to provide adequate liquidity support to the banking system to ensure its stability and robustness at this time,” the statement noted. w w w. t h e c o n t i n e n t m a g . c o m

FINANCE| BANKING

TOUGHER FUNDING AHEAD

NO “SYSTEMIC CONCERN”

RATINGS

THE

agency Moody’s, however, predicts a decline in market confidence towards small- and mid-size Kenyan banks following CBK’s Imperial Bank closure, and this was quite evident in bank withdrawals by consumers. In its latest report, the agency says that small banks could suffer a hike in their interbank rates as their larger counterparts take caution to reduce their level of exposure. Moody’s also confirms in a statement that “the wider systematic implications of Imperial Bank’s failure will be limited, although we do see a high likelihood of tougher funding conditions... This may include both deposit withdrawals and a hike in interbank rates while their ability to offer correspondent banking related services would be impaired.” “Imperial Bank’s closure also indicates that Kenyan authorities are unlikely to extend support to small and midsize banks in need,” it adds. “Nevertheless, the larger bank’s systemic importance to Kenya’s financial and payment system leads us to expect some level of government support in case of need.” Many African countries have highly fragmented banking sectors in need of consolidation. Data from the Institute of Economic Affairs (IEA) from 2014 indicates that Kenya has 42 licensed banks with 1,443 branches, some of which have opened branches in Uganda, South Sudan, Tanzania, the Democratic Republic of Congo, and Rwanda. They have previously gotten away with capital deficiencies which would result in massive penalties for international banks on the grounds of unsafe and unsound practices within the banking industry. At the time of the Imperial announcement in early October, CBK said it was placing Imperial Bank under receivership for a year due to “unsafe or unsound business conditions” and that it had started an investigation into malpractice. The investigation subsequently found that senior banks officials had made fraudulent withdrawals totalling KES 34 billion (US$334 million) from the bank over the course of more than a decade, threatening the liquidity of the bank, according to court documents.

TWO DECADES AGO, SOUTH AFRICA ALSO SAW A CULLING OF ITS MID-TIER BANKING SECTOR, WITH CLOSURES AND MERGERS. ZIMBABWE TOO HAS SEEN THE CLOSURE OF NINE BANKS SINCE 2011 MOSTLY DUE TO POOR CORPORATE GOVERNANCE, HIGH LEVELS OF NONPERFORMING LOANS, AND HIGH OPERATING EXPENSES.

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announcement caused anxiety that other mid-tier banks in Kenya were at risk. Kenyans holding large sums of money in small banks began transferring amounts to bigger banks. However, the Kenya Bankers Association (KBA) quelled fears with a release that bank assets are secure. KBA CEO Habil Olaka said in the October 15 note that the relatively small size of the incident “did not present a systematic concern for the sector.” In addition, the CBK governor has assured depositors in the two banks currently under receivership that their funds are safe. Up until that point, he said, Kenya’s banking industry was leading Africa in terms of financial inclusion and access to formal banking services. According to the World Bank Global Findex database, 55 percent of Kenyans aged 15 and above have a bank account. Indeed, even in South Africa’s far larger and more sophisticated banking sector, Kenyan banking is held in high regard. The latest report by the International Monetary Fund (IMF) also rates it highly, suggesting Kenya’s financial sector is developing into a model for sub-Saharan Africa. Besides boasting of a well-developed banking system, Kenya’s micro-finance institutions have been praised for their role in deepening financial inclusion among groups such as women and youths who have traditionally been left out of the financial system. Certainly, it receives higher regard than Nigeria’s banking system where, as recently as 2009, the country saw four CEOs of major Nigerian banks in prison, and a fifth on the run. Accepting a position in Nigeria’s central bank has become associated with a high degree of personal risk. In a statement, the CBK announced that it hopes to reopen Imperial Bank within a month, but that only small-amount depositors (less than KES 500,000) will have access to their funds at first. “The exact amount to be paid out is still under discussion and will be communicated later,” said the CBK statement. Depositors with larger sums will have access to five percent of their accounts. On December 2, the CBK allowed depositors to access up to KES 1 million. By January 23, a total of 15,059 claims valued at KES 5.9 billion had been paid. Payments to about 900 claims out of 1,177 that were questioned have however been stopped pending further due diligence, Njoroge said in a statement. Most of the approximately 51 percent of the 49,000 depositors who had less than KES 5,000 have however not lodged claims, he said.

KENYA NO STRANGER TO CORRUPTION

and the violation of money-laundering rules are all too familiar to this nation of 44 million people. Companies and investors cite pervasive graft as one of the biggest challenges to doing business in Kenya and US President Barack Obama raised the issue when he visited Kenya in July. In another unusual move, shortly after Obama’s visit, the ambassadors of the US, UK, and nine other countries said Kenya faced a “corCORRUPTION

The receivership should be seen as part of a “new broom sweeping clean” rather than a weakening of the banking sector, says KenInvest Chairperson Anne Muchoki.

Moody’s predicts a decline in market confidence towards small- and midsize Kenyan banks following CBK’s closure of Imperial Bank.

ruption crisis” and they would step up efforts to prevent the flow of illicit funds out of the country. In the wake of CBK taking over management of the two banks in November last year, President Uhuru Kenyatta said banks which violated anti-money-laundering regulations “will, at a minimum, lose their banking licences,” and instructed the CBK to urgently strengthen its supervision capabilities over banks. A further shock came in December, when Family Bank Ltd., a closely held Kenyan lender, announced that nine employees had left the company until the state authorities cleared them of involvement in a graft scandal that is under investigation. “It is a stance that is tough but necessary to ensure strict compliance with our fiduciary duties to all our stakeholders,” the Nairobi-based lender said in a newspaper statement. During a 2009 TED Talk, founder of global anti-corruption group Transparency International, Peter Eigen, said that “Kenya is prominent in the most corrupt countries’ listings globally.” According to the 2014 Transparency International Corruption Perception Index, Burundi, Kenya, and Uganda rank 159, 145, and 142 respectively out of 175 countries. Tanzania ranks 119, while Rwanda ranks 55. Njoroge has stated that the enforcement of stringent rules by the regulator is likely to continue in 2016. Appearing before the Finance Committee of the National Assembly, he said the Central Bank was considering harsher penalties for commercial banks that flout operational rules. He also said CBK would soon publicize enforcement actions that it would take against errant banks. The governor said that the review of the penalties would be a part of the regulator’s plan to strengthen supervision of lenders in the wake of the collapse of Imperial Bank. What is happening in Kenya is not unique to the country. Two decades ago, South Africa also saw a culling of its mid-tier banking sector, with closures and mergers. Zimbabwe too has seen the closure of nine banks since 2011 mostly due to poor corporate governance, high levels of non-performing loans, and high operating expenses. Like many global banking sectors, Kenya’s is in need of a good clean sweep.

COMPANIES AND INVESTORS CITE PERVASIVE GRAFT AS ONE OF THE BIGGEST CHALLENGES TO DOING BUSINESS IN KENYA AND US PRESIDENT BARACK OBAMA RAISED THE ISSUE WHEN HE VISITED KENYA IN JULY.

During the era of former CBK Governor Njuguna Ndung’u not a single bank was put under liquidation.

Ryan is a financial journalist based in South Africa. w w w. t h e c o n t i n e n t m a g . c o m

LASTWORD

Investing for Impact Roberta Annan, on the case for socially responsible financing of how to define investing, the first thoughts are usually around individual finances. We think of returns as personal, as being rewarding to the investor. In its truest sense, however, the standard dictionary definition of investment is “a devoting, using, or giving of time, talent, emotional energy, as for a purpose or to achieve something.” This definition captures the core of impact investing. Impact investing refers to investments in entities and funds with the purpose of generating a determinate, positive social or environmental impact, along with a financial return. Another term for impact investing is “socially responsible investing.” Impact investments can target a range of returns from below-market to market rate, depending upon the circumstances, in both emerging and developed markets. With impact investing on the rise globally, the market provides capital to address the most pressing challenges in sectors such as housing, education, sustainable agriculture, green technology, and healthcare. As such, impact investing counters conventional views that social and environmental issues can only be addressed by philanthropic donations. Impact investing reduces the burden on philanthropists and other not-for-profit entities by stepping in to fill a vital funding gap at a time when so many people are struggling, and the programs meant to support them are more strained than ever. Indeed, the world truly needs

WHEN ONE THINKS

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impact investments. So, just how quickly is this investment philosophy growing? JPMorgan estimates this market was worth US$60 billion worldwide in 2014, and, along with Monitor Deloitte and the Calvert Foundation, predicts it to increase to between US$400 billion and US$1 trillion worldwide in the next five years. Additionally, of this number, 22 percent of global-impact enterprises are located in Sub-Saharan Africa, and much of the opportunity lies throughout the continent. It is for this – and several other compelling reasons – that LJ Africa Advisors (LJAA) was recently founded in London, England. LJAA operates under a mandate to bring financial and investment expertise to the growing African market, while working with individual African countries to support their investment in key areas of opportunity such as power, infrastructure, oil and gas, telecommunications, and affordable housing. In eastern Africa, economic growth within the region has been steady in the last decade and during this time, the region has seen the rise of wealthy individuals. According to

IMPACT INVESTING REFERS TO INVESTMENTS IN ENTITIES AND FUNDS WITH THE PURPOSE OF GENERATING A DETERMINATE, POSITIVE SOCIAL OR ENVIRONMENTAL IMPACT, ALONG WITH A FINANCIAL RETURN.

Forbes magazine, six of the ten new millionaires to watch in 2014 have emerged from the East African region (three from Kenya and three from Tanzania). In addition, Tanzania has the fastest-growing number of millionaires in the region, and the country takes the lead for the most newcomers (three) to the Forbes’s “Africa’s Richest 50 2013” list. Many of these individuals, as well as investors, foundations, and trust managers, are eager to tackle the substantial challenges that Africa faces, including poverty, infrastructure development, and transport, by making sizeable investments in companies dealing with these issues. No matter where you are in the world, chances are that impact investing is happening all around you. You may not realize it, but a road under construction could have been made possible by impact investments – or a new school, a new water filtration system, a wind farm. The possibilities are endless. But one common thread remains the same: impact investing, at its core, is about the investor’s intention to facilitate a beneficial social or environmental impact that goes beyond the individual. It is not a practice solely for personal gain but rather for the greater good. After all, what again is the definition of an investment in its truest sense? “A devoting, using, or giving of time, talent, emotional energy, as for a purpose or to achieve something.” Annan is the CEO and Founder of Roberta Annan Consulting LLC (RAC) and a founding partner in LJ Africa Advisors. With expertise in business development and fundraising, she aligns investors with government entities and key strategic stakeholders to encourage the ease of doing business in Africa.

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