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Unleash Africa Podcast

Google is a great example of a champion company known around the world. It was born out of an ecosystem in the United States where venture capitalism supports and drives entrepreneurship that has the chance to reshape the landscape of not only the country, but the world.


Listen to our latest episode: "How African Countries Can Prosper in 2020"

Catch up on earlier episodes at UnleashAfricanTrade.com.

 

Reform-Minded Change Makers

The “Unleash Africa” video feature has focused on the forces that are impeding the rise of African countries including corruption, on leadership qualities of the late Honorable Lee Kuan Yew, Prime Minister of Singapore and why that leadership quality is the missing ingredient in the governance apparatus of African countries, and on seminal entrepreneurs like Elon Musk who have redefined the playing arena of their enterprise and in some cases, a global paradigm shift.

In this video, the conductor of the orchestra of Rwanda is changing the perception of African leaders as listless, corrupt and clueless. The Honorable Paul Kagame is transforming the image of Africa. But his most important achievement is moving more than 1 million Rwandans out of poverty to self-sufficiency. 

How PAUL KAGAME is Transforming RWANDA into an African Powerhouse

The Life and Wisdom of Richard Maponya
by Chris Bishop

He was one of the big names in business in Africa; as gentlemanly. as he was shrewd. He fought the odds and apartheid to stake his place in business and inspire millions of his countrymen to do the same.


Richard Maponya – the doyen of black business in South Africa – passed away in the early hours of January 6, after a short illness. Maponya turned 99 on Christmas Eve near the end of a long and fruitful life that saw him dine with the Queen, laugh with Bill Clinton and chauffer his old friend Nelson Mandela. Mandela asked Maponya, who owned a car dealership, to pick him up at the airport in Johannesburg after his release from prison in 1990.

Ï picked him up at the airport and that was the most frightening time of my life. We were chased by people on foot, helicopters, motorbikes and cars. Everyone just wanted to touch Mandela. They could kill him just trying to touch him,” Maponya recalled to Forbes Africa in a cover story in March 2017.   

Mandela was a close friend of Maponya since the 1950s. The future president, then a young lawyer   helped Maponya set up his first business against the restrictive apartheid laws that shackled black business.

Maponya wanted to open a clothing store in Soweto, Johannesburg; the authorities said no. Mandela lost the fight for the clothing store, but did manage to secure him a license to trade daily necessities. This opened the way for Maponya to start out with a milk delivery business that was to prove the foundation of his fortune.

More than half a century on, Mandela, then a former president of South Africa, beamed with pride, in 2007, as he opened the first shopping mall in Soweto.

Maponya Mall had taken the canny businessman a good deal of patience to put together. He acquired the land in 1979 – the first black man to secure a 100-year lease for land in Soweto – and spent many more years building up the mall.

“Ï fought for 27 years for that mall and was many times denied; they actually thought I was dreaming. When Nelson Mandela cut the ribbon to open the mall, that was the highlight of my life,” Maponya said years later.

It was a mile on a road less travelled by Maponya in a long journey from the tiny township of Lenyenye in Limpopo in northern South Africa where he was born. He moved across the province to Polokwane to train as a teacher and then, like many young men of his generation, moved south to Johannesburg in search of his fortune.

In those days, the gold mining city was booming, but only the few saw the fruits. Maponya was blocked at every turn as he tried to make his way in business; he won through making a fortune from property, horse racing, retail, cars and liquor.

Maponya mentored many black entrepreneurs and inspired many millions more he had never met. One of them was Herman Mashaba, the former mayor of Johannesburg, who made his own fortune with hair care products.

“To myself and the people I grew up with he was an inspiration to all of us to get into business…If he had started out in business in a normal world there is no doubt he would have been even bigger than he was,” Mashaba told CNBC Africa.

Maponya will be mourned by the millions who were inspired to follow him and by a business world that is richer, in more ways than one, for his nearly a century of hard work in which retirement was never an option.

“People who retire are lazy people. You retire and do what? Bask in the sun?  I am not that type of man,” he said in 2017 at the age of 96.

He could never be.


This content was originally published on forbesafrica.com.

Chris Bishop is the managing editor of Forbes Africa, which launched in October 2011. He has spent 36 years in journalism. He has tackled print, radio and TV and spent 23 years reporting on the African story. In 2011, Bishop had won South Africa’s ‘Sanlam Award for Excellence in Financial Journalism’ and in 1988 he had won the ‘Sir David Beattie Award’ for exposing a cover-up of an assassination attempt on the Queen. Bishop has reported for the BBC in London; CNBC Africa; SKY News; TVNZ and the SABC where he was also national news editor and senior executive producer of TV News. In 2013, Chris Bishop took the prestigious “Special Editor of the Year Award” at the annual PICA Awards event.

World’s Longest-Serving Ruler Must Reveal His Assets for an IMF Bailout
by Katarina Höije and Alonso Soto

Equatorial Guinea’s leader Teodoro Obiang Nguema Mbasogo, the world’s longest-serving president, should declare his assets before the nation receives more financial support, according to the International Monetary Fund.

Teodoro Obiang Nguema Mbasogo Photographer:Ludovic Marin/Pool/AFP via Getty Images

The central African country needs an IMF bailout to deal with a crisis that shrank its economy by a third to $13 billion last year. Under a program agreed to last week, the state will be required to increase transparency, improve governance and implement reforms to fight corruption, Lisandro Abrego, the lender’s mission chief for Equatorial Guinea, said in an interview.

“Authorities will implement an asset-declaration regime for senior public officials as part of the program’s requirements,” he said by phone from Washington. “It’s our understanding that the law will apply to all senior government officials.”

Obiang, in power since August 1979, and his regime have been accused by prosecutors in the U.S. and France of squandering the tiny Central African’s vast oil wealth. As recently as 2017, Equatorial Guinea was as rich in per-capita terms as its former colonial master Spain. Today, OPEC’s smallest member is struggling to pay its debts after oil prices collapsed in 2014. The government has piled up arrears with construction firms that equate to almost 19% of its gross domestic product, according to the World Bank. 

“The economy has been hit hard by the decline in oil and gas prices, which has affected export earnings and led to a virtual depletion of foreign assets,” Lisandro said. “The economy has also been affected by longstanding governance and corruption problems.”

Audits by the government of state-owned oil and gas companies are already under way and should be completed by mid-2020, Lisandro said. All active oil and gas contracts are expected to be made public by March, he said.

The IMF will also require Equatorial Guinea to join the Extractive Industries Transparency Initiative, which promotes good governance in the oil and mining industries. The country initially applied in 2008 and has since implemented several reforms to meet the membership requirements. Authorities filed a new application last month, Lisandro said.

Calls and text messages to Finance Minister Cesar Mba Abogo seeking comment went unanswered. A Finance Ministry official didn’t reply to questions sent by text message.


Money-Laundering Case

The IMF last week gave the green light to a $280 million loan to Equatorial Guinea, $40 million of which has already been dispersed. The loan roughly equates to what Obiang’s oldest son and vice president, Teodoro Nguema Obiang Mangue, spent between 2000 and 2011 buying luxury properties on four continents and assets including Michael Jackson memorabilia, documents filed in a 2013 U.S. Department of Justice money-laundering case show. The case was settled the following year.

The president’s son received a three-year suspended jail term and a $35 million fine from a French court in 2017 for spending tens of millions of dollars in public funds on a mansion, sports cars and jewelry. In September, Swiss authorities raised $27 million in an auction of exclusive cars they’d seized from him, including a limited-edition Lamborghini Veneno roadster that sold for $8.4 million. He’s denied any wrongdoing.

Human-rights and anti-corruption advocates have questioned why the IMF is lending its credibility to “a regime with no previous record of serious reform,” Sarah Saadoun, a researcher with Human Rights Watch, said in an interview.

“With no external pressure, besides the IMF, there’s a risk that the loan will fund the same lifestyle that the oil wealth has upheld for 25 years,” Saadoun said by phone from New York.

Oil was discovered in Equatorial Guinea in the 1990s. Revenues from offshore oil fields supported investments in large infrastructure programs but left little room for social projects. Less than half of the 1.3 million population has access to clean drinking water and 20% of children die before the age of five, according to United Nations data.

— With assistance by Michael Cohen


(Corrects headline and first paragraph to say Obiang is the world’s longest-serving president.)


This article was first published in bloomberg.com

Katarina Höije is a Bamako-based freelance journalist. 
Alonso Soto Joya is a correspondent writer for Bloomberg News about economics, politics and security in West Africa. Seeking to do more in-depth journalism in Africa after spending more than a decade covering Latin America for Reuters. 


South Africa is Missing Out on Fresh Fruit Export Growth. What it Needs to Do
by Shingie Chisoro - Dube and Pamela Mondliwa

South Africa’s urgent need to create jobs requires that the country take advantage of opportunities in the global economy that it can convert into quick wins. The fruit industry presents such an opportunity. The country’s fresh fruit industry is currently the largest exporter of agricultural products, contributing 52% of the value of South Africa’s agriculture export basket. It also represents 28% of total employment in agriculture.

 

South Africa’s fresh fruit industry is currently the largest exporter of agricultural products. Shutterstock

 

But there’s a great deal more it can do given that demand for fresh fruit is expected to continue growing at an average annual rate of 7.1% over the next two years. This is being driven by the growth of the middle class in China, Africa and other Asian countries.

South Africa is already an established player in global fruit exports, especially citrus. But it has failed to take full advantage of the rise in demand, especially for high value fruits such as berries and avocados. Countries that have successfully done so, like Mexico and Peru, increased their fruit exports by up to 15% per annum between 2013 to 2018. In contrast, South Africa’s fruit exports only rose by 3% over the same period.

The one success story has been citrus. The country’s share in the top six citrus exporting countries more than doubled from 6.6% to 15.7% between 2001 and 2017. It is now the second largest exporter of citrus globally.

Success of the citrus industry has been largely bolstered by research, innovation and technological developments, driven by the industry association - Citrus Growers Association (CGA) - in collaboration with government. These are critical aspects in maintaining markets, negotiating new markets and complying with sanitary and phytosanitary standards imposed by different importing countries. For example, investment in research and development is so important that it accounts for approximately 80% of CGA’s total annual revenue for the 2017/18 financial year. This has also been the case for other large volume fruit exports such as apples and pears as well as stone fruit.

This success demonstrates what is possible with concerted and coordinated action for fresh fruit. The Public-Private Growth Initiative announced by President Cyril Ramaphosa at Business Unity South Africa’s 2019 Business Economic Indaba suggests that there is an appetite for collaboration between industry and government on targeted initiatives.

As part of the initiative, the agriculture sector proposed a business plan to create 120 000 jobs by 2023. The business plan acknowledges the role that high-value fruit can play in creating jobs but there appears to be no prioritisation of how the different sub-sectors in agriculture will contribute to the overall objective. Research conducted by the Industrial Development Think Tank (IDTT) shows that targeted interventions in high-value fruit alone could create about 100 000 jobs by 2023.

What’s Possible

If South Africa is to aggressively find new export markets and grow its exports, it can achieve a conservative 5% export growth per annum over the period 2019 to 2023. Achieving a conservative 5% growth in export volumes (on top of local market demand growth of 3%) implies that production would increase by 34% from approximately 6.5 million tonnes in 2017 to 8.7 million tonnes by 2023.

At such increased level of production, assuming normal weather conditions, the fruit industry could create an additional 100 000 jobs by 2023. The creation of additional jobs is based on moves to higher value crops such as berries and avocados, which are more labour absorbing in production and packaging. These fruits have a higher employment intensity of 2.9 and 2.6 workers per hectare, respectively. On average the fruit industry employs 1.6 workers per hectare. But the recurrent droughts and erratic rains pose a huge risk to production. Good rains could see the industry improve from this position.

Avocados in particular would allow for the realisation of other policy objectives such as creating employment in provinces that have relatively higher levels of unemployment (above the country average of 37.3%, expanded definition). For example, 60% of South Africa’s avocados are grown in Limpopo (41.9% unemployment, expanded definition which includes those that want to work but are not actively searching for a job), 29% in Mpumalanga (43.9% unemployment, expanded definition) and 9% in KwaZulu-Natal (41.4% unemployment, expanded definition).

What’s Needed

A number of bottlenecks need to be addressed to realise the job opportunities. These include improving access to export markets, addressing congestion at the ports and improving the rail and logistics infrastructure.

With regard to access to markets, South Africa should prioritise high growth markets in South and East Asia. These include China, Vietnam, Thailand, South Korea and India. In the last five years, Chinese imports of fruit and nuts grew at a compound average growth rate of 38%. However, South Africa can only export citrus, table grapes and apples to China.

The biggest constraint for fresh fruit exports is complying with sanitary and phytosanitary standards in different markets. The process of compliance requires technical and science expertise. This expertise is needed to reassure importing countries that they are not at risk of any pests and diseases. For example, the CGA through its dedicated research and development division has been successful in carrying out cutting-edge research and solutions for pest and disease control. This has enabled the industry to demonstrate to trading partners that their exports do not pose risk to importing countries.

A key example relates to the European Union’s False Codling Moth concern with South Africa’s exports of citrus in 2018. The citrus industry was able to conduct research and provide technical information indicating that there was no risk in their fruit exports. If CGA had not dealt with the False Codling Moth concern, the EU would likely have blocked South Africa’s exports.

Improving compliance with sanitary and phytosanitary standards set by different importing countries means that the key institutions involved in agricultural and trade policies must have the necessary skills to negotiate market access and carry out regulatory functions and services effectively.

The high levels of congestion and delays at South Africa’s main ports remains a constraint to growing fresh fruit exports. Addressing such bottlenecks require investments in integrated digital systems to assist with planning and avoid product overload at the main ports.

Such digital solutions should be able to link growers and producers in-house systems to ports, logistics companies and shipping lines, which will create timeous and speedy supply chains. Digital solutions that also reduce the logistics costs and ease the process of exporting will increase the value of exports and also facilitate entry of new players into export markets.

Complementary investments in rail and logistics infrastructure are critical to aid with faster movement of products from the farm and through the ports.

Lastly, fruit farmers would also need to make changes. Workers would need re-skilling to meet the growing demand for digital skills, using advanced machinery and equipment as well as research and technology development.


This article was originally published on theconversation.com.

Shingie Chisoro - Dube is a researcher at the Centre for Competition, Regulation and Economic Development (CCRED) at the University of Johannesburg.

Prior to joining CCRED, Shingie worked as a researcher at the Centre for the Study of Equality, Social Organization and Performance (ESOP) in Norway, an organisation studying the relationship between institutions, mineral wealth and long-term economic development in developing countries. Shingie’s research interests include regional value chains in the agriculture and agro-processing space, regional economic development and industrial development. She has conducted research projects on industrial development and regional (global) value chains in agriculture and agro-processing across a number of Southern African countries.

Shingie holds a Master of Philosophy in Economics from the University of Oslo, Norway and a bachelor’s degree in Economics from the University of Zimbabwe. She has published in the Development Southern Africa.

Pamela Mondliwa is a researcher at the Centre for Competition, Regulation and Economic Development at the University of Johannesburg and a consultant working on competition and regulatory issues at Acacia Economics. Prior to joining CCRED, she worked as an economist in the Policy and Research division at the Competition Commission of South Africa.

Pamela has experience in conducting research for the South African government on economic regulation, and industrial policy. She also has experience in conducting economic analysis of mergers, abuse of dominance and cartel cases. Pamela holds a BCom (Hons) from Rhodes University. She has presented a number of papers at conferences and has several publications.


Nigeria: Why the Outlook for Fixing the Energy Crisis isn’t Good
by Nnaemeka Vincent Emodi

Nigeria returned to democracy in 1999. But it took another 16 years for power to change hands, with the All Progressive Congress clinching the office of the presidency in 2015.

 
Nigeria must invest more in solar panels like this to generate electricity Millenius/Shutterstock

Led by President Muhammadu Buhari, the new government had three priority areas: corruption, the economy and security.

The power sector is at the heart of the economy in Nigeria.

In its 2014 manifesto the party promised to expand electricity generation and distribution to supply 40,000 megawatts in four to eight years. It also said it would make power available from renewable energy sources, such as solar, hydro, wind and biomass, for domestic and industrial use.

There has been some development, including the completion of two hydroelectric power projects. The Geometric Power project has gas, coal and solar power plants. And the transmission network was expanded.

Yet, overall, progress remained slow. As he took office for his second term, Buhari made new promises. This time, the party’s manifesto said it would:

Generate, transmit and distribute from current 5,000–6,000 MW to at least 20,000 MW of electricity within four years and increasing to 50,000 MW with a view to achieving 24/7 uninterrupted power supply within ten years, whilst simultaneously ensuring development of sustainable/renewable energy.

The 2019 presidential election returned Buhari to steer the country for the next four years. The hope was that the victory would ensure that he would be poised to contain and tackle the challenges of the country.

But the outlook for meeting the targets in the energy sector isn’t good. Households and businesses in Nigeria feel let down. For many Nigerians, power supply seems much the same as ever. Some even claim that the situation has become worse.

The biggest issue facing Nigeria remains that of energy poverty, which successive administrations since 1999 have not resolved.

This points to the need – as a matter of urgency – for the present administration to identify the shortcomings of current policies. It must simultaneously develop policy options that will improve energy efficiency.

Policy and Interventions

One way the government hopes to achieve its promises is through the Power Sector Recovery Programme. This was set to run from 2017 to 2021. It covers a series of policy actions and operational, governance and financial interventions.

The government has started the first phase of independent power supply to all federal universities in the country. It is doing the same for about seven teaching hospitals. The benefits of this effort to the education and health sectors cannot be overstated.

But progress has been slow in the oil and gas sectors. Promises to speed up the Petroleum Industry Bill and ensure local content issues were fully addressed have not been met. The purpose of the bill was to improve transparency, attract investors, and stimulate economic growth and government revenues.

The bill has not yet been signed into law.

There have also been plans to rehabilitate four existing local refineries utilising funds from a project financing model. This would ensure local production above 90%, which largely matches domestic consumption.

But the Nigerian National Petroleum Corporation had an operating loss of N82bn at the close of the 2017 financial year. The country also relies heavily on imported fuel, which often leads to fuel scarcity.

So the current energy policies for the oil and gas sector are no more effective today than they were five years ago at meeting the energy needs of Nigerians.

What Next

The outcome of the 2019 presidential elections is likely to have little impact on Nigeria’s energy policies.

There are doubts about Buhari’s ability to make significant progress, particularly in areas of accountability, alternative energy and institutional rearrangement. This means that energy poverty will remain unresolved.

Although the incumbent president has been re-elected and may succeed in improving energy supply, overall energy policies will be relatively unaffected. This suggests that current energy policies in Nigeria are not likely to change over the next four years.

This, plus the fact that no steps have been taken to unbundle or privatise the state-owned Nigerian National Petroleum Corporation, means that energy companies in Nigeria might find it difficult to get affordable fuel supplies. This could negatively affect their investments. They will need to be ready for tough times ahead.

Buhari needs to make more judicious use of Nigeria’s petroleum revenue and to consider the advantages of alternative energy over fossil fuel use for power generation. More importantly, he should initiate energy policies that have a positive impact on the lives of all Nigerians.

Finally, changing or developing energy policies alone, without the requisite financial, fiscal, political, legislative and technological support, alongside a positive environment, may be ineffective. A comprehensive approach is needed that builds on the inputs from all energy stakeholders in the country.

This article is republished from The Conversation under a Creative Commons license. Read the original article.


This article was originally published on wtheafricareport.com.

Nnaemeka Vincent Emodi is a policy analyst at the Australian Academy of Science and Research Assistant at James Cook University. He recently completed a PhD in Economics at James Cook University, Cairns, Australia. His PhD research investigated the implication of long-term energy policies on the energy system under climate change conditions. He received his BSc degree in Chemistry from Michael Okpara University of Agriculture, Umudike, Nigeria. He completed his MSc degree in Engineering from the Department of Technology Management Economics and Policy Program at Seoul National University, Republic of Korea, focusing on energy policy and management. He is an author and co-author of some articles, reviews, chapters and book publications. His research interests include energy and environmental economics, climate change policy, low carbon transition and green energy adoption, renewable energy commercialization and patent propensity.


Ethiopia already Exports Coffee Beans—Exporting its Culture will be the Next Big Step
by Lynsey Chutel

 
In Addis Ababa’s affluent Bole neighbourhood, the traditional smell of roasting coffee beans wafts through a thoroughly modern coffee shop. Garden of Coffee is agnostically decorated with large comfy couches and floor-to-ceiling windows that look out onto the street, giving it the atmosphere of a coffee shop that could be anywhere in the world. Making it distinctively local is the woman spreading beans over an open roaster, in the slow circular movements of Ethiopia’s jebena buna coffee ceremony.

 
Ready for export.
  
She sits behind a counter, not far from fresh pastries on display and a contemporary commercial espresso machine, dressed in a branded T-shirt rather than traditional dress that accompanies the formal ritual. It is this meeting of the modern and traditional that Garden of Coffee founder Bethlehem Tilahun Alemu wants to export to the world by opening Garden of Coffee outlets everywhere she can.
 

Hand roasted.

“Ethiopia coffee is big, but as an Ethiopian I saw lot of green coffee beans sold to international brands,” said Alemu, the founder of the internationally successful, locally made, Sole Rebels shoe brand. Garden of Coffee also sells its own brand of single-source coffee, produced in a small roastery with beans grown by a cooperatives of female farmers. Quick to understand the global consumer’s search for authenticity, Alemu’s Garden of Coffee also offers teff wraps, made from the grain that could be the world’s next big superfood. It’s exactly the story that would appeal to international customers willing to pay for ethically sourced brands.

Ethiopians often claim bragging rights for introducing the world to coffee. Local legend has it a goatherd named Kaldi first discovered the perking effect of the red bean in the ninth century in Ethiopia’s southwestern Kaffa region.

In the 2018/2019 financial year, Ethiopia produced about 426,000 metric tons, exporting nearly 4 million bags, yet Africa’s largest coffee producer has few locally produced brands. Now, with a large diaspora that has introduced Ethiopian dining to the world, and domestic growth that has reintroduced the country to the global economy, Ethiopian coffee has the opportunity to take advantage of global consumer trends. Exporting a culture may require some watering-down though.


It could be anywhere.

“It’s a way of life,” she says of coffee in Ethiopia. Alemu believes commercialization of this culture would not diminish it, instead it would give Ethiopians a greater stake in a global industry they already contribute to. 

Tomoca is perhaps Addis Ababa’s first experiment in commercializing this coffee culture. Zewdu Meshesha bought the roastery from an Italian family in 1953, and maintained the acronym that gave the café its name Torrefazione Moderna Café. It was the first time coffee was roasted outside of the domestic setting, and to convince customers to stop by, the Meshesha family had to give away coffee, explains Kiroubel Seyoum, the group’s chief production officer.  

With urbanization, people now living in apartments had less time to roast and brew their own beans and Tomoca capitalized on this cultural shift. Tomoca’s flagship store is located in Addis Ababa’s historic Piassa neighborhood, a district that first showed signs of internationalization with Greek, Armenian, and, of course, Italian architectural touches. The original café feels mid-century European, and the beverage menu still uses Italian names. The coffee itself a departure from the oily dark roast brewed in Ethiopian homes, to a medium roast “Familia” brand that also highlights the flavor of the bean.

Today, Tomoca has six outlets around the city, with the design of each store reflective of the changing city, like the office bar or the gallery space. Tomoca has not tried to emulate the historic ritual, but rather chooses to present a distinctive flavor to the world, served in a globally recognizable style. Locals still prefer the dark roast, but have adjusted to machine-brewed medium. The slightly more acidic light roasts are not popular among Ethiopians, says Seyoum. 

“We don’t like our coffee light,” says Seyoum. “We eat spicy food so we like it strong.”


How it’s always been done.

The two brands are distinctive for exporting their take on Ethiopian coffee to the world, with Tomoca opening three outlets in Japan and Garden of Coffee’s plan to open 100 outlets in China by 2022. Garden of Coffee is looking to Canada next, while Tomoca is eyeing Sweden and other parts of Europe where customers already buy bags of their roasted coffee, says Seyoum. They may also consider expanding to the US too, to take advantage of the connection to a large diaspora community.

Like much of Ethiopia’s economic growth, exporting its coffee culture offers a boon for those already connected to industry, but threatens to leave behind those who built the culture. Coffee culture is still very much part of the fabric of Addis Ababa, with far more humble cafes all around.

Women set up makeshift coffee stalls outside restaurants and other small businesses, roasting small batches of beans on the spot. What used to be an easy way for women to access the informal economy could be under threat as commercialization of the sector requires more formal trade. It doesn’t help that coffee growers, fed up with the falling prices of coffee beans and changing climate, have begun growing khat instead, making it more difficult to access beans.

Ethiopian coffee outlets in Japan, China and elsewhere seem a world away, but they have the potential to influence the local industry by shifting focus and changing the domestic consumer culture. The prospect of capitalizing on its historic ritual could be a boon for the Ethiopian economy, as long as it doesn’t dilute the domestic culture.


This article was originally published on qz.com

Lynsey Chutel covers southern Africa from Johannesburg. Before joining Quartz, Lynsey worked as a correspondent for the Associated Press, covering breaking news and features in southern Africa. Earlier, she was a producer at the South African 24-hour news channel eNCA, where she reported from several countries in Africa, including Zimbabwe, Ethiopia, Madagascar and Rwanda. She holds a master's degree in journalism from Columbia University and a master's degree in international relations from the University of the Witwatersrand.


Economic Emancipation of African Nations
Capitalism and Mixed Economy 

by John I. Akhile Sr.

 
“Many forms of government have been tried and will be tried in this world of sin and woe. No one pretends that democracy is perfect or all-wise. Indeed it has been said that democracy is the worst form of government except for all those other forms that have been tried from time to time.…” Winston Churchill, November 11, 1947.  No one argues about the greatness and vision of Sir Winston Churchill. If you are, then I can’t help you. Evidence of his visionary leadership of the free world before the entrance of the United States and FDR into the fray is the stuff of legends. The “we shall fight on the beaches, we shall fight on the landing grounds, we shall fight in the fields and the streets, we shall fight in the hills; we shall never surrender...” speech to the UK House of Commons on June 4, 1940, is an exhortation of a nation and people to stiffen their back and prepare for all-out resistance. In the end, his vision of a Europe, sans the Gestapo and Hitler’s evil machinations won out. 


To borrow the same analogy as Churchill’s democracy being the worst form of government, Capitalism, likewise, can be said is the worst economic system except for all others that have been tried from time to time. Communism and socialism take a bow here. China was a very developing country until the little big man of China, Deng Xiaoping unleashed the Chinese people to use their creativity to create wealth in his “Poverty is not socialism. To be rich is glorious” exhortation of Chinese people to create their way to riches and eviscerate the nation’s impoverishment. In my book Unleashed: A New Paradigm of African Trade with the World, I have coined the phrase; “Command Capitalist Economy” to describe China’s experiment, which until Deng Xiaoping had never been tried anywhere in the world. A capitalist economy under communist command and control is a novelty still. 

Chinese Comand Capitalist economic system has not faced the duress of severe economic adversity, such as an economic downturn where large numbers of people lose a significant amount of money. In a capitalist system with a democratic government where there is broad transparency, and people are not able to manipulate the books, economic downturns are normal. They occur about once every 1.5 decades. Economic downturns are a course correction for humans over-exuberance of risk tolerance. No one yet knows what will happen to China’s experiment if a situation where rich people suddenly become poor and very rich people find the value of their holdings reduced and pressure builds for them to cover loans and exposure occurs. However, suffice to say that in using the mechanism of Capitalism to become a rich country, China has validated Capitalism as the best economic system for enabling countries to pull out of poverty.

In Africa, the challenge for the countries is that there is no clear path laid out save in Rwanda for countries to power their economic development. It continues to be a hodge-podge of systems. The worst aspect of it is the contemporaneous use of a system that emanated from the Non-Aligned Movement of the 1960s and ’70s. The Non-Aligned Movement is no more, but the tenents it espoused continue to the bread and butter of many African countries’ economic development strategy to their injury. The prophet has failed to demonstrate the prescience of predictions but continues to have followers. The Non-Aligned Movement arose from pressures that the cold war exerted on nations but, in due course, found itself run by then-Soviet satellite states like Cuba. Thereby largely invalidating its mandate of impartiality to either of the two protagonists in the struggle for global influence, Communism and Capitalism.

In African countries specifically and in the continents’ multilateral institutions, generally, economic deliberations should be informed by the two principal developments of our times. (1) the collapse of Communism in the Soviet Union; and (2) the transformation of China. It is incontestable that In matters of economic development, an African leader should be keenly aware of these two primary economic cataclysms of our time. Further, it is extrapolatable that leaders of nations seeking a way forward but devoid of deep knowledge of the two referenced events are like the blind and bound to lead his or her country into a ditch. Knowing the reason for the failure of Communism and the foundation of the economic resurgence of China is the absolute reference point for formulating economic strategy.

The Soviet Union failed because Communism could not address supply chain deficiencies in the economy. The system was unable to supply simple human necessities such as bread efficiently in a vast country with immense land resources for producing the raw material needed to produce flour. It also was unable to produce goods and services that it could sell to the world to earn convertible currency to import essentials needed in the economy. Communism became a quagmire of starvation and death from which the people of the Soviet Union could not extricate themselves unless they made a u-turn from the previous 70-year experiment and abandon the very tenant of its creation, which fortunately for the people, they did. Conversely, the process whereby China made its mark as a global economic power is also a path that shines as a shining light for other countries to study and execute. China has moved hundreds of millions from poverty; created millions of millionaires and hundreds of billionaires. It is now a 10 trillion dollar economy in the world and expected to become the number one economy in the next 20 to 30 years, although a resurgence of the US economy may forestall that eventuality. To paraphrase the Honorable Deng Xiaoping, “to be rich indeed has been glorious for the nation of China.”

When leaders decide that Capitalism is the way to go, creating off-shoots of the stem is very easy. In many African countries, determining the stem of economic development would have saved the nations untold billions of dollars, and vast amounts of human energy expended for the wrong course like the then-Soviet Union determined after 70 years of their experiment in Communism.  European countries also fell into the socialism trap by creating public-owned businesses that served mostly to provide patronage jobs for political parties, which became a drain on the resources of their treasury. It was the impetus for the global privatization movement that was started in Great Britain by Margret Thatcher’s government. 

Government ownership of businesses, aka, public enterprises, is a hallmark of the mixed economic system, which was a foundational principle of the Non-Aligned Movement. The world has since learned that most public businesses are a cesspool of corrupt malfeasance. Issues like paying of ghost workers; bloated payroll; perpetual annual losses; requiring perpetual government support; theft of company assets, including cash by politically appointed leaders; are all interwoven in the experience of government-owned business in African countries. Nigeria spent billions of dollars on building two huge steel plants and got nothing from the investment of treasure and labor. Nobody knows what happened to the money. The same scenario is true in petroleum refineries. Although the country built petroleum refineries, it was a net importer of gasoline and derivatives such as lubricants. It has fallen to a business, Dangote Group, to assume the role of refining Nigeria’s crude oil to attempt to achieve self-sufficiency in gasoline and derivative supply for the local economy. 

However, Capitalism without guardrails is also a non-starter for countries. Capitalism’s prophet nation, the United States of America, has vetted the theory that Capitalism without guardrails is dangerous for any country, from her own experience in the great depression of the 1930s and the recent episode that led to the global financial crisis in 2007. It is also noteworthy that a heavy hand in the affairs of the free-market is as dangerous as pure laissez-faire. South Korea, under Park Chung Hee, Taiwan under Kai Chang Shek, and Singapore under Lee Kuan Yew, had it right in applying varying degrees of Park Chung Hee’s Guided Capitalism principle. 

China has added aggressive interventionism into its economic development. Building Dams, High-Speed Rail, and entire cities. Out of the frantic development process have come some very spectacular corruption scandals. However, it is not possible to determine it’s success at this time. The test of the success of interventionism and the involvement of government in business enterprises depends on the modus-operandi of the governing authority. The last and most aggressive development initiative is the “Belt and Road” initiative. The rationale for China is to create an economy that is largely self-reliant due to diversified markets for exports and a diversified supply base of raw inputs for industry and society. Underpinning all of it is trusting Chinese managers of government resources to be disciplined and avoid dipping into government treasury through embezzlement or kickbacks. Activities that distort the performance os the economy of every nation.

It requires a determined effort to make a course correction in any endeavor. In the case of African countries, there is no better time than the present to deploy a carefully planned economic development course based on Capitalism as it’s the main stem. Choosing the path will eliminate the need to discuss whether the government should build industries or run businesses, which history has shown has not been financially prudent for most African countries. Deciding that the government should refrain from purely commercial and business activities will, in turn, enable governments to focus on creating the enabling environment for businesses and entrepreneurs to step into the fray to make investments to solve supply chain deficiencies in the economy. 

to be continued in next Month’s Unleash Africa Newsletter

JohJohn Akhile Author Photon I. Akhile Sr. is the author of two books: Compensatory Trade Strategy: How to Fund Import-Export Trade and Industrial Projects When Hard Currency is in Short Supply and now Unleashed: A New Paradigm of African Trade with the World. He is also the President of African Trade Group LLC., a U.S. based trading company.


Dokmai Rwanda
A Feature of Unleash Africa Editorial Team
 

Dokmai is an example of how African countries will rise from the ashes of impoverishment to an orbit of prosperity one company, one entrepreneur, one Bernadette Umunyana at a time. Dokmai is a bold and captivating endeavor, the very essence of entrepreneurship. A relative newcomer in Rwanda with roots deep in Laos, Dokmai was founded in 2014 as a private, family-owned company. Their rise has been evident throughout, beginning as Fairtrade handmade goods producers exclusively, with special attention to hand-woven and naturally dyed silk products that represent both traditional and en vogue fashion styles. 

It all began with one Bernadette Umunyana leaving Southeast Asia, deciding to restart a new handicraft business to attract the attention of the international community to the beauty and splendor of Rwanda. Her decision to restart a business focused on exquisite handicraft products immediately paid dividends – Dokmai has taken off ever since.

Dokmai’s products have a heartfelt engagement from Rwanda’s most skilled, highly-motivated leather craftspeople, most of whom receive in-house and on-the-job training. The workers pride themselves on providing customers with one-of-a-kind products that are made to last. Through their work, they’ve already helped to establish “Made in Rwanda” as an internationally recognized label for high-quality standards and value for money. 
 


By adhering to the principles of feminine empowerment and fair trade, as well as entrepreneurial, social, and environmental responsibility, Rwanda’s Dokmai has done wonders in terms of putting Africa’s core values in front of the whole world. On top of that, the fact that their product series and eco-leather line does not contain elements of animal origin and meet the expectations of customers with a vegan lifestyle, makes them even more unique.

African countries must find every Dokmai in their midst and offer assistance, so that they may survive and thrive. Such assistance includes market penetration, low-interest loans, management consultation, etc. African countries cannot afford to allow any export enterprise in their midst to fail, because in their success lies the economic emancipation of the continent’s countries.

Unleash Africa Editorial Team

Editorial:

Unleash Africa’s rai·son d'ê·tre is to share contents that stimulate discussions about development paths and options for the countries of Africa because the prevailing winds are not favorable and change is necessary. Throughout Africa, poverty and its attendant cargo of ills is expressing itself in grotesquely violent ways. It portends a future of certain militarist conflagration the like of which the continent has not experienced because the embers of conflagration will be supplied by a very large and largely hopeless, youth population. Whether it’s Boko Haram in Northern Nigeria, Niger Delta Avengers in Southern Nigeria, Al-Shabbab in Kenya, unrest in Mali and Central Africa, political and economic disenchantment in South Africa, the smoldering yet unquenched embers of the Arab Spring in Northern Africa, the continent is perched on a cauldron of volcanic socio-economic-political faults. Add to that mix the drop in global commodity prices, especially crude oil, and it is not surprising that voices of consequence in the affairs of the countries are beginning to sound an alarm about rising debt of African countries. "All of the Above Strategy for Development" highlights outside-the-box and traditional export-oriented business strategies that point the way for policy makers to intensify policy prescription in order to maximize or start to implement them.

In this feature, we present a brilliant look into Export-Oriented Industrialization Strategies for economic development. It sets forth both a predicate and subject for export of goods and services as a pathway for economic development.


Export Oriented Industrialization Strategies Intereconomics
By Neil Dias Karunaratne

 
The Role of Transnational Corporations
The switch by developing countries from import substituting to export oriented strategies occurred in the 1970s. The transnational corporations played a key role in effecting this switch in strategies. The American transnationals were the pioneers in the relocation of manufacturing activities so that vertically-integrated manufacturing operations could be carried out through wholly-owned subsidiaries or majority-owned affiliates in developing countries. The European, and soon the Japanese multinationals joined the fray to enter the cheap labour and tax havens offered by the free trade zones. Several critical factors explain the emergence of transnational corporations as the major dramatis personae in the export oriented industrialization strategy: 



  • The "technology component revolution" which facilitated the widespread practice of subcontracting to developing countries of labour intensive parts of highly complex manufacturing processes. International subcontracting was encouraged by offshore tariff legislation (e. g. US tariff items 807.00 and 806.30) and it facilitated the migration of the transnational corporations to the labour and tax havens offered by developing economies.
  • The "communication revolution" caused by containerisation and the developments in teleinformatics led to dramatic reductions in unit transportation costs and trans-border data flows. This made the relocation of manufacturing operations in distant developing countries an attractive economic proposition.
  • The "crisis in capitalism" caused by chronic stagflation made unions militant about any proposals to reduce real wages or any attempt to engage labour in monotonous or dehumanising repetitive production operations. This also prompted transnational corporations to migrate to free trade zones. The docile labour of such zones offered as much as a ten-fold wage advantage even after making allowances for productivity.
  • The type of products that were manufactured by transnational corporations in the free trade zones of developing economies using cheap labour and infrastructure facilities can be categorised (using a typology from the theory of comparative advantage in international trade) into Ricardian goods, Heckscher- Ohlin goods and product-cycle goods.
  • Ricardian or natural resource-based production occurred in resource-rich developing countries such as Brazil, Columbia, Malaysia, Indonesia and the Philippines. Here transnational corporations were engaged in mineral and lumber extraction and food processing for exports.
  • Heckscher-Ohlin production for export used standardised technology to manufacture a wide range of labour-intensive goods such as clothing, toys, sports goods, footwear and wood products.
  • Finally, in the case of product-cycle "goods the labour-intensive components of highly capital- intensive and skill-intensive end products demanded in the markets of advanced countries were assembled in developing countries. For instance, electronic goods such as TVs and transistor radios were manufactured from components assembled under magnification by low-paid female labour in free trade zones.

Benefits and Costs
There are erudite theoretical expositions that confirm the superiority of export promoting over import substituting strategies
, and equally forceful denunciations of the exacerbation of dualism and inequality in developing countries due to the pursuit of export-led growth policies. Empirical evidence has been marshalled by the National Bureau of Economic Research (NBER) to show the superior growth and employment-creation effects of export oriented strategies. The developing countries' exports to advanced countries were predominantly labour- intensive. This evidence substantiates the neo- classical factorproportions or Heckscher-Ohlin thesis. The exports between developing countries were revealed to be capital-intensive, indicating the bleak prospects for customs unions amongst developing countries ¹⁰.

The linkages (mainly local purchasing) and externalities generated by export oriented industrialization varied according to the stage of industrialization, availability of skills and entrepreneurship, the size of world market for the product and the efficiency of government institutions in the host countries. However, it has been observed that potential linkages vary in strength with the type of product: In the case of Ricardian products which are based on use of mineral and agricultural raw materials, weak linkages or local purchasing and collaboration were observed. In the case of Heckscher-Ohlin products which used standardised techniques to manufacture textiles, clothing, footwear, leather and wood products, very strong linkages and partnership with local producers were reported. But in the product- cycle goods, such as electrical goods manufactured by Phillips and General Electric, the manufacturing operations were tightly controlled by transnational corporations. In world-wide sourcing industries, such as electronic components assembly, the linkages were virtually negligible¹¹.

The entry of transnational corporations, with their massive financial resources, sophisticated technology, market power and superior organisational and managerial practices, leads to denationalisation or the take-over of local firms. The market behaviour of transnational corporations will be predatory and eventually cause the establishment of oligopolistic structures in host countries. The financial prowess of transnational corporations enables them to deprive the local firms of the use of domestic savings by offering more profitable investment. The claims that transnational corporations are more efficient, more productive, more sucessful than their local counterparts in the adaptation of technology in comparable industries is not borne out by cross- country surveys¹². The entry of transnational corporations into developing countries can spell take- over, merger and bankruptcy to local firms. Thus an unqualified export orientation can enhance the dependency of host countries on foreign firms. Moreover, the hypothesis that export oriented industrialization leads to skilling of labour and increased welfare for labour is also contentious. Besides, there is evidence indicating that transnational corporations operate in developing countries to gain access to the markets of other advanced countries by complying with the local content requirements of the Generalised System of Preferences.

The export oriented strategies are alleged to lead to dynamic divergence in developing countries as production is for consumption in the markets of advanced countries, while domestic consumption demands have to be met by imports from the latter. The lack of a nexus between domestic production and consumption impedes the development of autonomous growth based on basic needs demands of the indigenous people. Export oriented industrialization makes growth a reflex of the advanced countries' prosperity and thus reinforces the developing countries' dependency.

to be continued in next Month’s Unleash Africa Newsletter

6 T. Takeo: Free Trade Zones and Industrialization of Asia, Special Issue. AMPO: Japan-Asia Quarterly Review, Tokyo 1977, pp. 1-5.
7 Ho Kwongping: Bargaining on the Free Trade Zones, in: The New Internationalist, No. 85, March 1980.
8 Cf.J. N. Bhagwati : Anatomy and Consequences of Exchange Control Regimes,NewYork1978.
9 G. Chichilinski, S. Cole: Growth of the North and Growth of the South: Some results on Export led Policies, mimeograph. Department of Economics, Columbia University and SciencePolicy Research Unit, University of Sussex 1979.
10 A. O. Krueger: Foreign Trade Regimes and Economic Development: Liberalization Attempts and Consequences, NewYork 1978.
11 Cf. S. LaII: Transnationals, Domestic Enterprises, and Industrial Structure in Host LDCs: A Survey. Oxford Economic Papers, Vol.30, 1978, pp.218-247.
12 Ibid.


This article was originally published on econstor.eu

Neil Dias Karunaratne was born in Matara, Sri Lanka, the second child to Peter and Emelda Karunaratne. Neil grew up in Matara, a beachside city on the southern tip of Sri Lanka, in a large family with three brothers and three sisters. Neil was enrolled at SAC on 17 January 1950 and was admitted as a hosteller. It was during his time at St Aloysius that he developed a lifelong drive for academic achievement and excellence. He obtained a 1st division in the Junior exam in 1952 and a 1st division in the Senior exam in 1954. He was a bronze medalist of the Royal Life Saving Society and a Queens Scout and Troup Leader for a short spell. He passed his Voucher exam in the St John’s Ambulance brigade and was a member of the Under 16 athletics team. Neil was the holder of the Abeyesundere Memorial Scholarship.He left SAC in May 1955, while in HSC I, since the College had no facility for students pursuing a career in Statistics, and joined St. Thomas’ College, Mt Lavinia. Neil went on to complete a Bachelor’s degree in Arts (Economics) at the University of Peradeniya between 1956 and 1959.  Following his Bachelor’s degree, Neil subsequently started working, as a lecturer in economics at the University of Colombo, and, also in a government job with the civil service (the Bank of Ceylon). During this time, in the early 1960s, Neil developed an interest in econometrics and began to pioneer the teaching and research in this field in Sri Lanka.

Governance:

Governance to African countries is like oxygen to humans. It is crucial to the prospects of African countries achieving economic prosperity without disintegrating into civil conflict. It is the ability of political leaders to create the enabling factors that will facilitate maximization of the competitive advantage of every country, no matter the size or the amount of resource endowments. Better, more competent governance structures and environment is the missing element that African nations need to unleash the potential of their people and country. We will discuss it frequently in this segment of the newsletter.

In this issue, we are starting a large multi-insert report commissioned by AU about governance in African countries. To quote the authors “The imperative for the development of an African-generated governance report is three-fold: first, this homegrown report is consistent with previous decisions of the AU Assembly to take control of its own development agenda and accountability mechanisms; secondly, the research methodology in this report benefits considerably from consultations with the AU Organs and Institutions, Regional Economic Communities; and unfettered access to Member State informants and state-held data; thirdly, the report is generated by Africans for Africa, which improves prospects for the implementation of its recommendations..” The failure of good governance structures in African countries lies at the heart of all that ails the countries of the continent. Hopefully, the origination of the report will lend actionable credence that will propel action on the part of leaders and their governments.

 

The Africa Governance Report: 
Promoting African Union Shared Values
by the African Peer Review Mechanism (APRM) In Collaboration with the African Governance Architecture (AGA)


CHAPTER 1: INTRODUCTION

1.1 The Concept of Governance  
 
            
The concept of governance is traditionally linked to ruling and control, specifically the manner of exercise of power. Governance refers to the exercise of economic, political and administrative authority to manage a country’s affairs at all levels. “Good governance” has the following major components: legitimacy, whereby the government has the consent of the governed; accountability that ensures transparency and answerability for actions; respect for law and protection of human rights; and competence, which consists of effective policy making, policy implementation and service delivery.¹ These are the basic definitions that are utilised throughout this report.
         
1.2 Background and Context of the Africa Governance Report            
    
The Africa Governance Report (AGR) a collaborative project of the African Governance Architecture (AGA) Platform. Its development is led by the African Peer Review (APRM) continental secretariat. The AGR assesses the implementation of the African Union (AU) shared values by the Member States in five areas of governance: transformational leadership; constitutionalism and the rule of law; Interrelationships of peace, security, and governance; the nexus of development and governance; and the role of Regional Economic Communities (RECs) in African governance. The AGR provides a baseline for regular and continuous tracking and analysis of governance trends.

The AGA Platform is inspired by the Constitutive Act of the African Union and was established as a mechanism composed of AU Organs, Institutions, and the Regional Economic Communities.² The platform functions to facilitate stakeholder dialogue for the harmonization and coordination of instruments and initiatives for promoting good governance, democracy, the rule of law, and human rights. The platform’s focus is on implementation of the AU Shared Values, including the African Charter on Democracy, Elections and Governance (ACDEG).³
    
The AGA Platform retreat of March 2018 identified several collaborative programmes, including development of a report provisionally entitled Assessing the State of Governance in Africa.

The development of the Africa Governance Report was guided by the Constitutive Act of the African Union and the AU Agenda 2063. The Act is the basis of the organization’s establishment, objectives, and principles. It also defines the major implementing organs and institutions. The agenda constitutes the AU’s strategic framework for socio-economic development and transformation of the continent. The adoption of this framework meant that the Member States agreed and committed to act collectively to achieve the AU Vision of “An integrated, prosperous and peaceful Africa, driven by its own citizens and representing a dynamic force in the international arena”.⁴ The AGR is also guided by the Declaration adopted by the 16th Ordinary Session of the AU Assembly of Heads of State and Government, which committed Member States to promote the social and economic development and integration of African economies to achieve increased measures of self-reliance and self-sustainment.

The report focuses on four AU Agenda 2063 Aspirations, namely:
● Aspiration 1: A prosperous Africa based on inclusive growth and sustainable development.
● Aspiration 3: An Africa of good governance, democracy, respect for human rights, justice and the rule of law.
● Aspiration 4: A peaceful and secure Africa.
● Aspiration 6: An Africa whose development is people-driven, relying on the potential of African people, especially its women and youth, and caring for children. 

Each of the four aspirations has goals, priority areas, and targets.⁵ These aspirations resonate with the (global) United Nations Agenda 2030 for Sustainable Development Goals (SDGs), which constitute the UN’s universal call for action to end poverty, protect the planet, and ensure that all people enjoy peace and prosperity. In particular, Goal 16: “Promote peaceful and inclusive societies for sustainable development, provide access to justice for all and build effective, accountable and inclusive institutions at all levels”.⁶

Therefore, the AU Aspirations 1, 3, 4 and 6 and UN SDG 16 are the starting point for the baseline report, and will be the foundation for future annual monitoring, assessments, and reviews of the state of governance on the continent.

Therefore, this inaugural AGR focuses on five key governance assessment areas:                                     
●  Transformative leadership.                                     
●  Constitutionalism and the rule of law.                                 
●  Peace and security (Silencing the Guns).                    
●  Development and governance.
●  The role of Regional Economic Communities (RECs).
                
The decisions of the AU Assembly will determine the scope of subsequent AGRs.    

1.3 The Purpose of the Africa Governance Report          
 

The objective of the Africa Governance Report is to provide an assessment of the status of African governance and provide a basis for tracking of governance developments and analysing trends on the continent. It aims to be relevant for the Member States, AU Organs, and other stakeholders. Its other purpose is to inform the public, Member States, the RECs, AU organs and institutions on the trends of governance in the continent. Additionally, it aims at determining recommendations for the enhancement and/or improvement of governance in promoting African progress. The AGR is intended to provide a foundation for regular and continuous tracking of governance, and to underline and share best practices among Member States.      
         
1.4 Methodology of the Africa Governance Report     
           
This is a baseline report that relies on existing information and data that could be used as a basis for measuring and assessing change in the selected aspects of governance.

The report presents facts, and therefore, it focuses on issues and areas that could be quantified to allow for the measurement and assessment of changes. With the purpose of being evidence-based and action- oriented, the AGR sought to analyse the AU shared values, and AU common decisions, declarations and agreements that were adopted for collective actions aimed at realising the vision, goals, and objectives of the AU.  
         
Crucial in explaining the status of the selected governance variables was the examination of the implementation of those decisions and other expressions of AU shared values. The proposed recommendations derive from the challenges that constrain the implementation of shared values. These recommendations are suggested for consideration in the quest to enhance governance in Africa.                
The AGR aims to be an evidence-based report. Its development combined complementary research methods, including: (i) examination, critical analysis, and synthesis of existing information and data from published governance, economic performance, human development, peace and security, and other reports; (ii) consultations with key stakeholders in the Member States, Regional Economic Communities (RECs), the African Union Organs and Institutions and other stakeholders (private sector; civil society organizations, prominent persons); and (iii) supplementation of these with targeted, selective surveys.
                    
1.5 The Mandates and Purposes of the APRM as an AU Structure            

Established in 2003, the APRM is the African Union’s primary institution responsible for facilitating the voluntary assessment of governance in the participating Member States, and monitoring their adherence to and conformity with the Declaration on Democracy, Political, Economic and Corporate Governance, and the African Charter on Democracy, Elections and Governance (ACDEG).⁷   

Following the AU Assembly decision to integrate the APRM into AU structures,⁸ its mandate was expanded in 2017. The AU Assembly adopted an initiative to revitalise and refocus the APRM as an innovative tool for sharing best practices. At the 28th Ordinary Session, the Assembly decided that the APRM should have the responsibility to oversee monitoring and evaluation in all key governance areas of the continent, including tracking the implementation of the African Union Agenda 2063 and the UN Sustainable Development Goals (SDGs).⁹

Subsequently, the 30th Ordinary Session of the Assembly welcomed an initiative to re-position the APRM as a tool for early warning on conflict prevention.¹⁰ This function would be performed through the establishment of harmony and synergy amongst the AU structures and processes, specifically, the APRM, the African Governance Architecture (AGA) and the African Peace and Security Architecture (APSA).        

The implications of these AU Assembly decisions are that: (a) the APRM function was strengthened as a continental instrument for assessing, monitoring, and tracking participating countries’ adherence to and conformity with the Declaration on Democracy, Political, Economic and Corporate Governance and the African Charter on Democracy, Elections and Governance. Additionally; and (b) the expanded mandate included new roles in monitoring Agenda 2063 and the UN SDGs, and contributing to the establishment of an early warning system for conflict prevention.      
 
Therefore, the APRM has become central to the promotion of AU shared values, as facilitator of the implementation of agreed political, economic and corporate governance values, codes and standards by the Member States, and tracking AU Agenda 2063 achievements and UN 2030 Agenda for SDGs in the pursuit of democracy, peace, security, political stability, and sustainable development. 

to be continued in next Month’s Unleash Africa Newsletter


1 United Nations Committee of Experts on Public Administration Fifth session New York, 27-31 March 2006 (E/C.16/2006/4) Agenda item. 5 Compendium of basic terminology in governance and public administration. Definition of basic concepts and terminologies in governance and public administration.

2 AU Assembly decision AU/Dec.1 (XVI).

3 http://www.aga-platform.org.

4 African Union Commission (AUC), 2015. Agenda 2063: The Africa We Want. The AU Agenda 2063 has seven aspirations: A prosperous Africa based on inclusive growth and sustainable development; an integrated continent, politically united and based on the ideals of Pan-Africanism and the vision of Africa’s Renaissance; an Africa of good governance, democracy, respect for human rights, justice and the rule of law; a peaceful and secure Africa; an Africa with a strong cultural identity, common heritage, shared values and ethics; an Africa whose development is people-driven, relying on the potential of African people, especially its women and youth, and caring for children; Africa as a strong, united and influential global player and partner.

5 Briefly, the priorities of: Aspiration 1: A prosperous Africa based on inclusive growth and sustainable development: ending poverty, inequalities of income and opportunity; job creation (youth employment); resolving problems of rapid population growth and urbanization; habitation and access to the basic necessities of water, sanitation, electricity; social security and protection; developing Africa’s human and social capital and health care services; economic transformation; productivity and competitiveness; food self-sufficiency; harnessing the potential of Africa’s ocean economy; sustainable management of biodiversity, forests, land and waters and addressing climate change. Aspiration 3: An Africa of good governance, respect for human rights, justice and the rule of law: consolidating democracy and improving the quality of governance; respect for human rights and the rule of law; institution building for a developmental state; development-oriented and visionary leadership. Aspiration 4: A peaceful and secure Africa: strengthening governance, accountability and transparency; strengthening mechanisms for securing peace and reconciliation; addressing emerging threats to Africa’s peace and security; and implementing strategies for the continent’s financing of security needs. Aspiration 6: An Africa whose development is people-driven, relying on the potential of African people, especially its women and youth, and caring for children: full gender equality in all spheres of life; and engaged and empowered youth and children.

6 UN, 2015. Transforming Our World: The 2030 Agenda for Sustainable Development (A/RES/70/1).

7 NEPAD Secretariat 6th Summit of the NEPAD Heads of State and Government Implementation Committee, 9 March 2003, Abuja, Nigeria. African Peer Review Mechanism (APRM): Base Document (NEPAD/HSGIC/03-2003/APRM/mou/annex (ii); African Union Assembly of Heads of State and Government, Thirty-Eighth Ordinary Session of the Organization of African Unity, 8 July 2002, Durban, South Africa (AHG/235 (XXXVIII), Annex II).

8 Decision Assembly/AU/Dec. 527(XXIII), 23rd Ordinary Session of the Assembly of the African Union held in Malabo, Equatorial Guinea, on the Integration of the APRM into the African Union structures.

9 AU Assembly/AU/Draft/Dec. (XXVIII)Rev.1; 23rd Ordinary Session of the AU Assembly/AU/Dec. 527(XXIII), Decision on the Integration of the APRM into the African Union Structures Doc. EX.CL/851(XXV); Assembly/AU/Dec. 631(XXVIII) Decision on the Revitalisation of the African Peer Review Mechanism.

10 Assembly/AU/Dec. 686(XXX) 30th Ordinary Session of the Assembly, 28–29 January 2018, Addis Ababa, Ethiopia. Decision on The Report of The African Peer Review Mechanism (APRM). 

 

This article was originally published on au.int.

The African Peer Review Mechanism (APRM) is a mutually agreed instrument voluntarily acceded to by the member states of the African Union (AU) as a self-monitoring mechanism. It was founded in 2003. The mandate of the APRM is to encourage conformity with regards to political, economic and corporate governance values, codes and standards, among African countries and the objectives in socio-economic development as well as to ensure monitoring and evaluation of AU Agenda 2063 and SDGs 2030.
The African Governance Architecture (AGA) is a mechanism for dialogue between stakeholders that are mandated to promote good governance and bolster democracy in Africa. In the book entitled The African Union Law (Ed. Berger Levrault, 2014, p. 29) Blaise Tchikaya established the link between conceptual platform called AGA and the modernisation of International Law applicable to African states. The AGA is fundamentally one aspect – probably the most significant – of recent international law of governance.
Unleashed: A New Paradigm of African Trade with the World is now available to buy at any of the sites listed below. 

Unleashed Site | Bookmasters | Amazon.com
African Trade Group’s Infrastructure Project for African Countries

African Trade Group has designed a project that addresses internal roads, which is one of the most important infrastructure challenges facing African countries, with a very innovative infrastructure plan.

Highlights of the plan:

  • It is a private sector-driven initiative. It will involve the private and public sector in every participating African country.

  • The funding for the project is through private capital markets and will be led by one of the world’s preeminent financial services firms. They will partner with financial services companies in every African country in market making and deal structuring.

  • The payment for the project is designed around the resources capabilities of African countries using conventional and unconventional means.

  • Indigenous African contractors will sort out and be invited to supply construction services in each country in order to contribute to the process of building long-term capacity within a country.

  • African labor will make up a minimum of 50% of the jobs that emanate from the project in each country.

  • The project manager will be a renowned world-class civil engineering company. They will partner with other firms of renown and qualification.

We encourage our African readers who are in high office to contact us for additional information. Also follow the link to read additional details about the plan.



African Trade Group

Our Mandate
To deliver Africa to the world and the world to Africa. 

Our main focus is on African trade. We specialize in helping clients in African countries to develop industrial projects. We will broker commodities and manufactured goods to and from the global market to African countries. In the area of industrial exports, we will help our clients to develop export oriented industries and market the goods produced in hard currency markets.

Our Vision

Our goal is to be a key component of the transition of African countries from raw materials exports to industrial goods export. In addition to contributing to the rise of export industries in every African country, African Trade Group aspires to become the premier company in the trading of commodities and manufactured goods of African origin.

Contact Us
John I. Akhile Sr
Publisher
www.unleashafricantrade.com
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Copyright © 2020 Unleash African Trade, All rights reserved.


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