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Africa is Rising, Where is The Evidence?Effective Politics and Policy Making in the New Africa
All rights reserved 2015 | Nkunimdini Asante-Antwi | Metis Decisions LLC
Africa is Rising
Who are the key drivers and what can the laggards learn? What role for
the African Entrepreneur?
A Broader View
Fact Sheet
54 Countries – 2nd most populous after Asia (estimated at 1.1 billion)
Libya was the first to gain independence in 1951.
South Sudan was the last; on July 9, 2011 from another African country.
Home to world’s leading cocoa output (2/3 of global production)
30% of world’s mineral reserves.
Zimbabwe; 2nd largest platinum reserves.
2nd most widely spoken language is Arabic (100m+)
…The Narrative
Africa’s Basket
In 2012, total GDP of Africa was $1.3trn, equating to
2.5% of world’s $54trn (source: Old Mutual
Investment Group). GNI per capita; South Africa
($6,800), Nigeria ($2,850).
124 kWh per capita annually.
Africa’s poorest households are spending around
$10 per kilowatt-hour on lighting—20 times more
than Africa’s richest households. Compare, that to
U.S where national average cost for electricity is
$0.12 per kWh and in the United Kingdom is $0.15
per kWh (Africa Progress Panel).
Notwithstanding freedom and democracy, popular
participation and social inclusion remain crucial
policy imperatives.
Trade & Investment
Infrastructure
Democracy & Governance
B.R.I.C.S or B.R.I.N.C.S?
40%
Business Constraint
- Infrastructure
Governance
Structures AMU/UMACEN-SAD
COMESA
EAC
CEEAC-ECCAS
CEDEAO-ECOWAS
IGAD
1. Africa Union – 8 Economic Regional Communities (REC)
2. African Development Bank (AfDB)
3. Civil Society Organizations such as; IMANI Ghana (Ghana), African Economic Research Consortium (Kenya), Al-Ahram Center for Political and Strategic Studies (ACPSS) –Egypt, Centre for the Study of the Economies of Africa (CSEA) (Nigeria) etc.
SADC
Lagos Plan of Action
1980-2000
The Business Environment
4.5% Real GDP
Growth Forecast
2015 (AfDB)
6.1 billion (70%
of global
population) to
access SMART
phones by
2020.
“
”
Behind every corrupt politician
are 10-20 corrupt businessmen.
- Mo Ibrahim
Assessing Policy and Political Risks
Policy Discontinuation
Supply chain exposure; an emerging political risk for
African entrepreneurs.
Political victimization.
Over-emphasis of FDIs at the expense of building local
entrepreneurial capacity.
Annual
cost of
corruption
- A.U Study, 2002
“
”
Knowledge is power. Information is
liberating. Education is the premise of
progress, in every society, in every family.
-Kofi Annan
The Social Sector – Emerging Risks
Libya and Botswana leads Africa in Human Development Index (HDI) performance.
Rwanda, Burundi and South Africa ranks #7, #17 and #18 respectively on the Global Gender Gap Index Report, 2014, ahead of U.S.A and U.K
Language and culture continue to be a barrier to regional integration.
The teaching of critical thinking and problem-solving at all levels of the education ladder, particularly, tertiary, remains a key challenge to business growth and wealth-creation.
Socio-cultural Risk Indicators (SRIs)
World University Rankings
No African University in first 200,
not even South Africa.
Fudan University, China (193) and
Lomonosov Moscow State
University, Russia (196) all
members of BRICS, are featured in
same. (Source: Times Higher
Education World University
Ranking.)
Human Development Index 2014
Countries Index Ranking
Norway 0.944 1
Australia 0.933 2
Libya 0.784 55
Botswana 0.683 109
Egypt 0.682 110
U.K 0.7383 26
Last 18 countries
all in Africa
OWNERSHIP
STRUCTURES“
I’ve always said we must
overcome our thinking of being
the sole owner of our businesses,
and that is one of the drawbacks of Ghanaian businesses.”
-John Dramani Mahama
(President, Ghana)
Less than 15% are
Limited Liability
Over 60% - Sole
Proprietorships
Others
40% of GNP in low-
income economies
produced by informal
sector (World Bank).
Economy
Overview
Strategy & Structure
Average growth over last 10
years
Financial Intermediation
Infrastructure
Global trade balance
Frontier market debt finance
Data Source: AfDB Statistics Dept.
Euro Area 1.5%,
2015. IMF
Japan 1.0%, 2015
Economy (Cont’d)
Fiscal Performance
-0.09
-4.4
-4
-5
-6
-5
-4
-3
-2
-1
0
2008 2009 2010 2011
Monetary Development
Ghana: Deposit/GDP increased from 20.7% in 2010 to 21.4% in 2011. Debit card usage (% age 15+) is 11.4%. DMB asset/GDP moved from 23.9% in 2010 to 23.1% in 2011.
South Africa: Deposit/GDP was 59.1% in 2011 from 59.2% prior year. Debit card usage (% age 15+) was 45.3% in 2011. DMB Asset/GDP inched downwards to 78.8% in 2011 from 82.5% in 2010.
Cash Surplus/GDP (%)
Data Source: Africa Devt. Indicators
(ADI), IMF
Data source: Global Financial
Development Database (GFDD), IMF)
Equity & Debt Markets
South Africa: Mutual funds assets to GDP/ratio was 30.6% in 2011, down
from 38.9% in 2010. Stock market capitalization to GDP ratio trended
southwards from 200.9% in 2010 to 145.2% in 2011.
India: Mutual fund asset/GDP ratio (2010: 6.6%, 2011: 4.6%). Stock market
capitalization/GDP ratio was down in 2011 (68.7%) from 82.8% in 2010.
Brazil: Mutual fund asset/GDP ratio (2010: 44.1%, 2011: 46.5%). Stock market
capitalization/GDP ratio was down in 2011 (58.3%) from 67.1% in 2010.
Ghana:
2010: 9.5%
2011: 8.4% Data source: Global Financial Development
Database (GFDD), IMF.
Technological
Changes
Mobile subscriptions in Q1 2015 was
910million (Africa), according to Ericsson
Mobility Report 2015. This includes 21
million new subscriptions. Africa, Asia and
Middle East are expected to drive global
growth going forward.
Growth has been
driven broadly by
sector liberalization
that has allowed
competitiveness and
investments in
infrastructure by
private actors.
2012: 14.6% | 2013: 16.9% | 2014: 19.2%
Internet Users per 100 People
Source: Internetworldstats.com
High-speed
broadband | Fibre
& Wi-Fi Networks
$500m
E-commerce or M-commerce?
What Are the Lessons?
Leaders and Laggards
Governance & Democracy
Leader: Ghana or Botswana?
Increasing use of law courts to
settle political disputes and
protect human rights.
Strong and vibrant media with
assertive civil society sector led by
IMANI Ghana.
Botswana adjudged #1 Global
Rule of Law Index according to
World Justice Project (WJP).
C.A.R – Laggard?
“…the security situation [in CAR]
remains volatile and clashes
between anti-Balaka [militias]
and ex-Séléka elements continue,
while criminal activities aimed at,
among other things, controlling
the country’s natural resources
are increasing.”
-Ban Ki Moon (UN Sec Gen.)
Human Development
Libya – Leader?
Ranks number 1 in Africa and # 55
globally on the 2014 Human
Development Index.
Included in the High Human
Development category with
countries such as Russia, China
and Brazil.
Niger – Laggard?
Ranks last (187th) globally.
Included in Low Human
Development category with
countries such as Eritrea, Chad
and Malawi.
Source: Human Development Index, 2014.
Economic Growth
Nigeria – Leader?
USD 568.5 billion GDP by year-end 2014, according to World Bank data, making Nigeria the 22nd
biggest economy after Sweden.
The country’s GDP outstripped South Africa in 2014 to be the biggest in Africa, growing at 6.3% in 2014.
This notwithstanding unemployment is still high, estimated at 25.1% in 2014.
Zimbabwe – Laggard?
Average real GDP growth over
decade covering 2003-2013 was
-1.6%.
Experienced strongest
performance in 2010 (9.6%),
slowing down to 6.0% in 2013.
High inflation
Source: Global GDP Ranking, 2014. World Bank.
Technology
South Africa – Leader? Internet penetration was 49% in
2014, compared to 38% for Nigeria.
Estimated 133% mobile phone and 47% Smart phone penetration compared to 72% and 29% respectively for Nigeria on same metrics.
13% of age 15yrs+ used electronic platforms for payment in 2011 compared to SSA average of 2.1% same year. (GFFD)
Sierra Leone – Laggard?
7.2% mobile penetration as at
2012 (least in Africa).
Only 1.7% of the country’s 5.7
million people use the Internet.
Source: Internetworldstats.com
Financial Intermediation
South Africa – Leader?
Highest DMB’s deposits/GDP ratio
(59.1%) in 2011.
DMB’s asset/GDP ratio very high
(82.5%, 2010), enabling big-ticket
deal financing from domestic
sources.
Uganda – Laggard?
DMB’s asset/GDP ratio quite
modest (19.1%, 2011)
Deposit/GDP ratio in 2010 was
16.7% while 2011 registered 17.8%
Source: Global Financial Development
Database (GFFD), World Bank
Ease of Doing Business
Mauritius – Leader?
Aggressive reforms implemented to improve the ease of doing business. Score: 28 out of 189 economies surveyed by IFC.
5 procedures to start business in 6 days with cost 2.1% of per capita income.
4 documents to export goods in approx. 10 days. Cost per container; $675
5 documents with 9 days import turnaround time, costing $710 per container.
Eritrea – Laggard?
Ranks as the most difficult place to do business (189th) across 189 economies survey by IFC in 2014.
It takes 13 procedures in 84 days with 41.5% of per capita income as cost to start a business.
It takes about 490 days and approx. 22.6% of claims sought to enforce contracts.
It takes an average of 54 days for import/export.
Source: Doing Business Report 2015, IFC.
Globalizers and Localizers
The Stark Evidence
Meet Eric Kinoti
Company: Shades Systems (EA) Limited
Founded: 2007
Sector: Light Manufacturing (Tents)
Role: Founder
Asset Size: Not Available
Annual Revenue: USD 1million
No. of Employees: 18
29yrs
Kenyan
“It was never easy, and it will never be easy to start up. I faced a lot
of difficulties, so many hurdles and obstacles…but I was
determined to make my dream a reality.”
Meet Bright Simons
Company: mPedigree Network
Founded: 2007 (Re-launched 2009)
Sector: Technology
Role: Founder and CEO
Asset Size: Not Available
Annual Revenue: Not Available
No. of Employees: Not Available
Some Key Clients: AstraZeneca, Sanofi, Tropical Cables Conductor Ltd.
Ghana
“…that experience opened my eyes to a whole new world of
fighting the system—of being an activist. And this led directly
to my becoming a technology innovator.”
Meet Patrick Ngowi
Company: Helvetic Group
Founded: 2007
Sector: Renewable Energy (Solar)
Role: Founder and CEO
Asset Size: USD 15million
Annual Revenue: USD 5m (2013)
No. of Employees: Not Available
Key Markets: Tanzania, Uganda,
Burundi.
29yrs
Tanzania“You should start small, with lean operations,
and scale up as you go along. I started my solar
company being the only employee, going on roof
tops to install one solar panel at a time.”
Meet Tunde Kehinde
Company: Jumia Nigeria
Founded: 2012
Sector: Online Retail
Role: Co-founder (Resigned 2014)
Asset Size: Not Available
Annual Revenue: Not Available
No. of Employees: 1000+
Key Markets: Nigeria, Ghana,
Egypt
31yrsNigeria
Meet Khaled Shady
Company: Mubser
Founded: 2013
Sector: Technology
Role: Founder
Asset Size: Not Available
Annual Revenue: Not Available
No. of Employees: Not Available
23yrsEgyptian
“Mubser was our team’s graduation project and we
decided to take it to the next level to make it a startup to
support the millions of blind and visually impaired people.”
Meet Winifred Selby
Company: Ghana Bamboo Bikes
Initiative / Afrocentric Bamboo Ltd
Founded: 2010
Sector: Light Manufacturing
Role: Co-founder
Asset Size: Not Available
Annual Revenue: Not Available
No. of Employees: Not
Key Markets: EU, U.S.A
20yrsGhana
“Because we discovered that, there were many bamboo
plants in Ghana people took for granted. So we wanted to
add value to that to address the transport needs of people.”
Now, Meet Joshua…
$3/day
30yrsPoor…
Abasua Mountain
Farming
Tourist Support
Services
Micro-trading
Meet David Too…
Dropout
5yrsChild
Laborer
21.8%
Child Labour (5-17yrs)
Source: GH Living Standards Survey 6
Finally, Meet Ama Akyea
School Attendance Status (5-17yrs)
Never Currently Used To
Female 6.1 88.3 5.6
Rural 9.2 85.45.3
Urban 2.2 92.7 5.1
Alone
11yrs
Broken Spirit
Data Source: GLSS6
33% of 26million – 5-17yrs
The Role of African Entrepreneur
Restoring Human Dignity
South Africa
Ave. unemployment
last 15yrs
25.27%
Where Do We Start?
Empathy
Collaborations and Business
Combinations
Formalization
Mentoring and Coaching
Long-term Investments
Scaling Globally
Collaborate with Higher
Education
Responsive Regulation
Bridging Infrastructure Gap
Fiscal and Monetary Discipline
Institutional Strengthening
Tax Regime Rationalization
Wave of the Future
Mobile/Data
“…value chain gaps
persist in traditional
sectors; agric and
industry.”
Personal
Corporate
Public Policy
The End
Out of Darkness comes a great
light
Out of despair rises new hope
Out of the concrete, the flower
grows
Out of stillness a wild wind
blows
Wisdom for the wise
Poetry for the young
Arise and take your place
under the sun, Africa.
Presented by
Nkunimdini Asante-Antwi
Founder, Metis Decisions LLC
+233 505 767 865
+233 202 952 658