Open banking represents a promising opportunity for incumbent banks and <a href="https://www.cnbcafrica.com/2021/how-kenya-aims-to-become-global-hub-for-fintech-innovation/">up and coming fintechs</a> to develop and deliver innovative digital financial services to consumers everywhere. Nowhere is this potential more promising than in the emerging markets of Africa, where the World Bank estimates that up to 65% of adults in sub-Saharan Africa are unbanked.



To unleash the potential of open banking, banks and fintechs, with government support, need to come together to provide economic stimulus and financial inclusion opportunities to the 370 million unbanked and unserved citizens across the continent. Research has proven that financial inclusion can improve GDP by up to 30% in frontier markets like Kenya &#8211; dramatically higher than the 2% &#8211; 3% increase that most economists consider to be healthy.



<h2 class="wp-block-heading" id="h-what-is-open-banking">What is open banking?</h2>



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-820x547.jpeg" alt="" class="wp-image-410634" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-120x80.jpeg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-1536x1024.jpeg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/GettyImages-1273885048-scaled.jpeg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



Open banking is a privacy-protected, data-sharing ecosystem, supported by regulators and aimed at creating competition and promoting innovation in financial services. Within an open banking ecosystem, incumbent banks and other financial institutions like digital banks and telco mobile money providers exchange consumer data with other financial services providers or third-party providers like fintechs. The data sharing takes place within a tightly regulated privacy framework centered on consumer consent.



With open banking a variety of third-party financial service providers can access the consumer financial data that is held by a bank or telco through the simple use of application programming interfaces (APIs). It increases a service provider’s go-to-market speed by eliminating the need to use back-end applications to change existing data architecture. Through the use of APIs, third parties aggregate several data sources to create more holistic customer credit profiles and more relevant financial services offerings.



Data sharing is a prerequisite for open banking products, yet most unbanked individuals have no digital financial profiles or data trails. For this reason, it is important to consider how other types of digital data from mobile phones such as social media activity, airtime purchases and utility payments could be leveraged by open banking ecosystems. Mobile money wallets are a key driving force in Africa with over 320 million users representing a single point of integration.



Sub-Saharan Africa is the most developed market for <a href="https://www.cnbcafrica.com/2021/how-mobile-money-platforms-can-help-reduce-inefficiencies-in-africas-healthcare-sector/">mobile money</a>, accounting for two-thirds of global mobile money transactions in 2020. There is a huge opportunity to leverage this growing popularity to encourage financial inclusion, with open banking as the driver.



By responsibly sharing customers’ digital financial data, fintechs and other types of financial institutions can do a better job than traditional banks of offering products and promoting financial behaviors that alleviate some of the pain points experienced by unbanked and underserved customers.



Here are a few examples of how open banking can enhance financial inclusion.



<ol class="wp-block-list" type="1"><li>Reducing barriers to access.&nbsp;Cumbersome customer sign-up/KYC procedures can result in prohibitive cost barriers for unbanked customers. By expanding open banking to include telecommunications, social media, money wallets and other types of data, a simple SIM card registration could come into play.</li></ol>



<ul class="wp-block-list"><li>Providing access to responsible credit.&nbsp;Properly designed, open banking products, through the use of alternative financial data, can expand access to credit that helps consumers accurately assess what they can afford. Such data can include mobile bill payments, rent payments, utility bill payments, etc.</li></ul>



<ul class="wp-block-list"><li>Encouraging informed financial behaviors.&nbsp;Personal finance and budgeting awareness can empower consumer&nbsp;insights generated from consumer transaction data. Consumers can put these insights into practice and develop informed financial behavior.</li></ul>



<ul class="wp-block-list"><li>Enabling participation in the global economy. By providing consumers with access to digital payment products and services such Pay-to-Person (P2P) or Pay-to-Merchant (P2M), open loop schemes such as virtual debit or credit cards from Visa or Mastercard allow the unbanked to participate in the global economy, thus spurring economic growth and driving financial inclusion.</li></ul>



<h2 class="wp-block-heading">In Africa, telcos are a key piece of the financial inclusion puzzle.</h2>



Mobile phone penetration is roughly 50% in Africa, lower than world averages, but it is growing at the fastest global pace, at over 6% annually. Smartphone penetration remains low and concentrated in certain countries such as Nigeria, Egypt and South Africa.



However, owners of feature phones can still take advantage of some of the many open banking-enabled products such as automatic savings sweeping, smart loan repayment and decentralized KYC. These types of services use data only on the backend and do not require the consumer to own a smartphone. Others, such as switching utilities or personal finance management, could work on SMS or USSD menus but with limited functionality.



Over the next 5 years, as mobile phone penetration continues to grow and open banking adoption spreads across the continent, the opportunities for new services and product offerings for the unbanked in Africa are immense. Open banking will enable the unbanked and underserved to make more informed decisions and better manage their limited resources when incomes are severely constrained. Credit products can cover immediate liquidity needs&nbsp;responsibly. Savings products can help customers prepare for hard times. Finally, enabling consumers to transact with anyone in the world opens untapped possibilities.



With open banking technology we are taking a step in the right direction toward financial inclusion. By simplifying and democratizing financial services through personalized offerings that serve a wider spectrum of individuals, a more inclusive financial culture can emerge. This is the promise of open banking in Africa and beyond.



For a deeper-dive into how open-banking can help drive financial inclusion, I found this excellent report from CGAP to be very helpful. <a href="https://www.cgap.org/research/publication/open-banking-how-design-financial-inclusion" target="_blank" rel="noreferrer noopener">https://bit.ly/3f6ZKwD</a>



<figure class="wp-block-image size-medium is-resized is-style-rounded wp-duotone-000000-ffffff-1"><img loading="lazy" decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-210x300.jpg" alt="native" class="wp-image-410635" width="163" height="233" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-210x300.jpg 210w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-560x800.jpg 560w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-56x80.jpg 56w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-768x1097.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-1075x1536.jpg 1075w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/Amir-pic-copy-scaled.jpg 1433w" sizes="auto, (max-width: 163px) 100vw, 163px" /><figcaption>Amir Yazdanpanah&nbsp;is the Managing Director, MEA of&nbsp;Flybits,&nbsp;a global fintech that helps banks contextualize data to deliver highly personalized customer experiences through its AI-driven personal engagement platform.&nbsp;</figcaption></figure>

Unsecure mobile phone with open lock.

The Promise of Open Banking in Driving Financial Inclusion in Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="546" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-820x546.jpg" alt="" class="wp-image-410559" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-820x546.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-768x511.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k-1536x1022.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/51008793946_8a23be8a2d_k.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>Close-up of physical coins of Bitcoin, Litecoin and Ethereum in a wallet full of FIAT money coins. Photo: via Flickr</figcaption></figure>



New digital forms of money have the potential to provide cheaper and faster payments, enhance financial inclusion, improve resilience and competition among payment providers, and facilitate cross-border transfers.



But doing so is not straightforward. It requires significant investment as well as difficult policy choices, such as clarifying the role of the public and private sectors in providing and regulating digital forms of money.



Some countries may be tempted by a shortcut: adopting cryptoassets as national currencies. Many are indeed secure, easy to access, and cheap to transact. We believe, however, that in most cases risks and costs outweigh potential benefits.



Cryptoassets are privately issued tokens based on cryptographic techniques and denominated in their own unit of account. Their value can be extremely volatile. Bitcoin, for instance, reached a peak of $65,000 in April and crashed to less than half that value two months later.



And yet, Bitcoin lives on. For some, it is an opportunity to transact anonymously—for good or bad. For others, it is a means to diversify portfolios and hold a speculative asset that can bring riches but also significant losses.



Cryptoassets are thus fundamentally different from other kinds of&nbsp;<a href="https://www.imf.org/en/Publications/fintech-notes/Issues/2019/07/12/The-Rise-of-Digital-Money-47097?utm_medium=email&amp;utm_source=govdelivery">digital money</a>. Central banks, for instance, are considering issuing&nbsp;<a href="https://www.imf.org/external/pubs/ft/fandd/2021/03/what-are-central-bank-digital-currencies-mancini-griffoli.htm?utm_medium=email&amp;utm_source=govdelivery">digital currencies</a>—digital money issued in the form of a liability of the central bank. Private companies are also pushing the frontier, with money that can be&nbsp;<a href="https://www.imf.org/external/pubs/ft/fandd/2021/06/online/digital-money-new-era-adrian-mancini-griffoli.htm?utm_medium=email&amp;utm_source=govdelivery">sent over mobile phones</a>, popular in East Africa and China, and with stablecoins, whose value depends on the safety and liquidity of backing assets.



<h2 class="wp-block-heading">Cryptoassets as legal tender?</h2>



Bitcoin and its peers have mostly remained on the fringes of finance and payments, yet some countries are actively considering granting cryptoassets legal tender status, and even making these a second (or potentially only) national currency.



If a cryptoasset were granted legal tender status, it would have to be accepted by creditors in payment of monetary obligations, including taxes, similar to notes and coins (currency) issued by the central bank.



Countries can even go further by passing laws to encourage the use of cryptoassets as a national currency, that is, as an official monetary unit (in which monetary obligations can be expressed), and a mandatory means of payment for everyday purchases.



Read more: <a href="https://www.cnbcafrica.com/2021/bitcoin-tops-39000-for-the-first-time-in-nearly-6-weeks-adding-114-billion-to-the-crypto-market/">Bitcoin tops $39,000 for the first time in nearly 6 weeks, adding $114 billion to the crypto market</a>



Cryptoassets are unlikely to catch on in countries with stable inflation and exchange rates, and credible institutions. Households and businesses would have very little incentive to price or save in a parallel cryptoasset such as Bitcoin, even if it were given legal tender or currency status. Their value is just too volatile and unrelated to the real economy.



Even in relatively less stable economies, the use of a globally recognized reserve currency such as the dollar or euro would likely be more alluring than adopting a cryptoasset.



A cryptoasset might catch on as a vehicle for unbanked people to make payments, but not to store value. It would be immediately exchanged into real currency upon receipt.



Then again, real currency may not always be readily available, nor easily transferable. Moreover, in some countries, laws forbid or restrict payments in other forms of money. These could tip the balance towards widespread use of cryptoassets.



<h2 class="wp-block-heading">Proceed with caution</h2>



The most direct cost of widespread adoption of a cryptoasset such as Bitcoin is to macroeconomic stability. If goods and services were priced in both a real currency and a cryptoasset, households and businesses would spend significant time and resources choosing which money to hold as opposed to engaging in productive activities. Similarly, government revenues would be exposed to exchange rate risk if taxes were quoted in advance in a cryptoasset while expenditures remained mostly in the local currency, or vice versa.



Also, monetary policy would lose bite. Central banks cannot set interest rates on a foreign currency. Usually, when a country adopts a foreign currency as its own, it “imports” the credibility of the foreign monetary policy and hope to bring its economy–and interest rates–in line with the foreign business cycle. Neither of these is possible in the case of widespread cryptoasset adoption.



As a result, domestic prices could become highly unstable. Even if all prices were quoted in, say, Bitcoin, the prices of imported goods and services would still fluctuate massively, following the whims of market valuations.



Financial integrity could also suffer. Without robust anti-money laundering and combating the financing of terrorism measures, cryptoassets can be used to launder ill-gotten money, fund terrorism, and evade taxes. This could pose risks to a country’s financial system, fiscal balance, and relationships with foreign countries and correspondent banks.



The Financial Action Task Force has set a standard for how virtual assets and related service providers should be regulated to limit financial integrity risks. But enforcement of that standard is not yet consistent across countries, which can be problematic given the potential for cross-border activities.



Further legal issues arise. Legal tender status requires that a means of payment be widely accessible. However, internet access and technology needed to transfer cryptoassets remains scarce in many countries, raising issues about fairness and financial inclusion. Moreover, the official monetary unit must be sufficiently stable in value to facilitate its use for medium- to long-term monetary obligations. And changes to a country’s legal tender status and monetary unit typically require complex and widespread changes to monetary law to avoid creating a disjointed legal system.



Read more: <a href="https://www.cnbcafrica.com/2021/90-billion-wiped-off-crypto-market-as-bitcoin-drops-below-30000-for-first-time-in-nearly-a-month/">$90 billion wiped off crypto market as bitcoin drops below</a> <a href="https://www.cnbcafrica.com/2021/90-billion-wiped-off-crypto-market-as-bitcoin-drops-below-30000-for-first-time-in-nearly-a-month/">$30,000 for first time in nearly a month</a>



In addition, banks and other financial institutions could be exposed to the massive fluctuations in cryptoasset prices. It is not clear whether prudential regulation against exposures to foreign currency or risky assets in banks could be upheld if Bitcoin, for instance, were given legal tender status.&nbsp;



Moreover, widespread cryptoasset use would undermine consumer protection. Households and businesses could lose wealth through large swings in value, fraud, or cyber-attacks. While the technology underlying cryptoassets has proven extremely robust, technical glitches could occur. In the case of Bitcoin, recourse is difficult as there is no legal issuer.



Finally, mined cryptoassets such as Bitcoin require an enormous amount of electricity to power the computer networks that verify transactions. The ecological implications of adopting these cryptoassets as a national currency could be dire.



<h2 class="wp-block-heading" id="h-striking-a-balance">Striking a balance</h2>



As national currency, cryptoassets—including Bitcoin—come with substantial risks to macro-financial stability, financial integrity, consumer protection, and the environment. The advantages of their underlying technologies, including the potential for cheaper and more inclusive financial services, should not be overlooked. Governments, however, need to step up to provide these services, and leverage new digital forms of money while preserving stability, efficiency, equality, and environmental sustainability. Attempting to make cryptoassets a national currency is an inadvisable shortcut.



<a href="https://blogs.imf.org/bloggers/tobias-adrian/?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener">Tobias Adrian</a>&nbsp;is the Financial Counsellor and Director of the IMF’s Monetary and Capital Markets Department.



<a href="https://blogs.imf.org/bloggers/26101-2/?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noreferrer noopener">Rhoda Weeks-Brown</a>&nbsp;is General Counsel and Director of the IMF’s Legal Department.

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Cryptoassets as National Currency? A Step Too Far

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b-820x547.jpg" alt="" class="wp-image-410222" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/28334431792_0f328c02ec_b.jpg 1024w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>Woman Using a Hoe to Till the Soil on Small Tanzania Farm Photo: via Flickr</figcaption></figure>



Food is the most basic of needs. It decides not just the health of individuals but also the health of communities which affects the health of our economies. Underpinning the food we eat, is agriculture which accounts for at least 23% of sub-Saharan Africa’s GDP with about 40% of the workforce engaged in the sector.



At the heart of Africa’s agriculture are the smallholder farmers. These are millions of hardworking men and women typically farming on less than a hectare of land. They grow staple crops such as maize, wheat, rice, cassava and sorghum.



However, notwithstanding their significant contribution to economies across the continent, farmers in Africa continue to face significant challenges on many fronts. From climate change to shocks including droughts, floods, pests and diseases, these farmers are disproportionately affected and further, have a low capacity to adapt and mitigate. This is exacerbated by the fact that they work in a sector that gets a disproportionately low level of financing, with only 4 out of 49 African countries reaching the Comprehensive African Agriculture Development Programme (CAADP) recommended target of 10% public expenditure on agriculture.



Consequently, Africa’s full agricultural potential remains untapped. As a dynamic, forward looking Africa marches alongside the rest of the world in the Decade of Action to deliver the Sustainable Development Goals (SDGs), agriculture remains a key lever to propel African economies into a prosperous future. Growth generated by agriculture in sub-Saharan Africa is estimated to be 11 times more effective in reducing poverty than GDP growth in other sectors. The world over, major economies have used agriculture to push their economies forward. And history has shown us that no society makes the transition to a modern economy without first modernizing its agriculture.



The pathway to the bright socio-economic future that we all desire for Africa is through an inclusive agriculture transformation agenda. As such, my conviction is that driving Africa’s economic transformation through the lens of agriculture, should be a top priority that must take precedence over all other policy considerations at the continental level.



When I took over the leadership of Ghana, my country needed solutions for hunger, malnutrition, poverty and a host of other problems. Understanding the potential of agriculture to address these challenges, my administration worked to deliver a more efficient and productive agricultural base that would become the engine of the economy by providing food security, ushering in industrialization, creating jobs, and increasing export revenues.



The results speak for themselves, between 2002 and 2005, cocoa production in Ghana, the world’s second largest producer, doubled from 350,000 tons a year to 734,000 tons a year, a record in more than a century of cocoa farming in the country.



From thereon, my government successfully used many of the same techniques to improve production for food crops such as maize, yams, and plantains, as well as livestock and fish. As



a core strategy, my administration also strengthened and tasked Ghana’s Grains and Legumes Development Board with the mandate to supply quality seeds and planting materials to farmers in order to improve the quantity and quality of Ghana’s agriculture produce. Altogether, my administration worked tirelessly to support irrigation, improve seeds and crop diversification, infrastructure, storage for harvest and created an enabling environment for farmers to access mechanization like tractors.



In 2007, during my second term in office, the late Mr. Kofi Annan, launched the Alliance for a Green Revolution in Africa (AGRA), an African institution that sought to support governments to catalyse transformation of smallholder agriculture by advancing uniquely African solutions to sustainably raise farmers’ productivity and connect them to a growing marketplace. AGRA has evolved into a powerful force and tool for the transformation of our continent.



AGRA’s approach to fostering an inclusive agricultural transformation approach has been to convene, catalyse and broker local partnerships to support African governments to prioritize agriculture, allocate adequate resources to support smallholder farmers to access information, appropriate technology, and sustainable market and at the same time; creating enabling business environment to leverage private sector investment.



Over the last decade, including Mali, Rwanda, Ghana and Tanzania, I have seen countries where AGRA has been supporting governments, come through on their AUC CAADP Malabo targets by committing 10% of national expenditure to agriculture. A select number of these countries have each successfully achieved an annual growth rate of 6% with their respective agricultural sectors. A couple more are striving to achieve SDG 2 (zero hunger) by end of 2021.



With various ongoing efforts thus far at national levels in strengthening Africa’s agricultural sector, I have no doubt we could achieve a food secure Africa by 2030 if African institutions like AGRA and its partners continue to proactively double-down on their efforts to make that happen.



Given the urgency of ensuring the food security for Africa and its people, we cannot afford any delays in implementing the right policies to ensure success. Africa cannot wait. Now is the time for an African agriculture transformation. This requires an efficient eco-system that unlocks the right policies, public investments and private sector engagement; spurs rural-sector economic growth and; which can deliver broad and accelerated impacts for all.



At the level of the smallholder farmer, there is a need to develop a digitized extension system, across which the continent’s smallholder based agro-industry, can in turn, enable a seamless transition from subsistence farming to profitable agriculture.



At an infrastructure and management service level, there is an urgent need to retool the capacity of the entire sector’s value chain proposition in order to ensure fundamental, paradigm-shifting change; beginning with the provision of continuing access to development generating knowledge, which the smallholder farmer can immediately benefit from; and extending to input and output markets with the goal to ultimately ensure efficient interaction across Africa’s entire economic value chain.



At each national level this would mean sustained progress, so that both the agricultural and non-agricultural economies reach and maintain higher income, faster growth, secure access to affordable and nutritious food, and greater inclusiveness in the growth process.



Now is our moment to invest in agriculture to deliver a new era of food security and economic growth in a digital ag-eco-system that works for Africa.



H.E. John Kufuor is former President of Ghana (2001-2009) and former Chairperson of the African Union (2007–2008). In 2011, he was named joint winner of the World Food Prize for Food and Agriculture.

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Africa’s smallholder farmers are the linchpin to economic success

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="549" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-820x549.jpg" alt="" class="wp-image-410218" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-820x549.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-300x201.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-768x514.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920-1536x1028.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/portugal-1816896_1920.jpg 1920w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>Image by Pascal Laurent from Pixabay</figcaption></figure>



In Africa, there’s never been a better time to be alive.



The last two decades have seen steady improvements to the extent that a child born in Africa today has a better chance of living longer, avoiding extreme poverty, receiving a primary school education and joining a growing economy, than ever before.



Yet not all the movement is in one direction. The COVID-19 pandemic is having a profound impact, forcing much of Africa into recession. While the continent’s long-term outlook for growth remains positive, too often the expansion is inconsistent, fails to create jobs and delivers benefits that don’t trickle down.



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<iframe loading="lazy" title="Mo Ibrahim, Sudanese-British billionaire | The Brave Ones" width="500" height="281" src="https://www.youtube.com/embed/46dCQ6nHIEY?feature=oembed" frameborder="0" allow="accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share" referrerpolicy="strict-origin-when-cross-origin" allowfullscreen></iframe>
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There is inconsistency, too, when it comes to governance, the issue that sits at the heart of progress. Without good governance – without transparent, trustworthy and democratic leadership – social and economic gains are wasted. A good year can quickly be followed by setbacks and backsliding. That said, the last decade has broadly been a period of improvement. In 2019, a little over 60% of Africa’s 1.3 billion people were living in a country where overall governance, as measured by <a href="https://mo.ibrahim.foundation/news/2020/2020-ibrahim-index-african-governance-key-findings">the Ibrahim Index of African Governance</a>, was better than in 2010.



Clearly, I am an optimist and there are good reasons to be optimistic. But we must also be realists.



While some economies in Europe and the United States are already bouncing back from the pandemic, with vaccination drives that have covered 60-70% of their adult populations, Africa is still waiting. Our leaders deserve credit for enforcing lockdowns and limiting infections, but they have struggled to get hold of vaccines. By the <a href="https://www.afro.who.int/news/nine-10-african-countries-set-miss-urgent-covid-19-vaccination-goal">start of June</a> this year, only 32 million vaccine doses had been distributed across Africa. Vaccine hoarding by richer countries is a major part of the problem, but the crisis has also revealed the current chronic shortfall in Africa’s own vaccine manufacturing capacity.



It’s too early to count the full cost of the pandemic for the continent. But this year’s <a href="https://mo.ibrahim.foundation/forum/downloads">Ibrahim Forum Report</a> on COVID-19 in Africa highlights how it is only likely to deepen inequalities and impose deep costs on governments ill-equipped to handle the shock. The knock-on impact will be fewer resources not only for health but also for areas like education, training and investment, which can lead to frustration and anger, and an increased risk of unrest or conflict.



In many African countries, children have missed out on months of education and social contact. At home with few resources, they have gone hungry, missed health check-ups, and been exposed to greater risk of violence and abuse. The impact on mental health and wellbeing is significant, and the consequences enduring.



It is at moments like these that governance comes to the fore. The pandemic is an unprecedented test of leadership, one which many African leaders have stepped up to. Some have acted more decisively than peers in other parts of the world. But they can’t rest on their laurels. Every day brings new, harder decisions that will shape outcomes for generations.



On public health, on education, investment and even tax policy, leaders must act intelligently at a national, regional, and continental level. They need to seize the opportunity to introduce policies that provide better protection for their populations as they weather the pandemic and emerge from it.



So how does Africa turn this crisis into a springboard for change? For me, creating opportunities for children and young people to prosper must be at centre of the response. That requires a laser focus on education, training, investment and jobs. These aren’t just warm words. All the evidence supports the case – successful societies invest in their youth, producing lifelong, intergenerational benefits for health, education and the economy.



There must be investment, the type that creates jobs and builds stronger societies. Investment is growing in Africa – from governments, public and private corporations, private equity funds and financial institutions – but it still tends to be short-term and hit hard by sudden changes in sentiment or commodity prices.



There are, however, signs of a shift. Major global economies recognise the value and importance of closer ties with the continent. They see markets like Nigeria, Ethiopia, Ghana or Kenya, with tens or hundreds of millions of citizens, bright minds and dynamic ideas. They want to invest for the long-term in infrastructure and industrial development, and they think about future consumers, too. This is critical to strengthening trade between Africa and the rest of the world, but we must also build on the success of the African Continental Free Trade Area and strengthen trade networks within the continent.



By 2030, a fifth of the world’s population will be from Africa. Every year, tens of millions more young people from our continent join the labour market. They need the skills and training that allow them to realise their potential. Young people are our continent’s greatest asset, but if we don’t create opportunities for them – to learn, to find work, to be productive &#8211; we risk losing them as they migrate to places that can deliver what they’re looking for. The pandemic is a crisis for Africa, as it is for the world. But like every challenge, it presents opportunities. With the right decision-making, the ground can be laid to strengthen education, investment, jobs and trade. Whether it’s in the digital economy, the green transition, resources, energy or infrastructure, Africans have a role to play. We must seize this opportunity to build a better Africa.







Mo Ibrahim is the Founder and Chair of the Mo Ibrahim Foundation. The 2021 <a href="https://urldefense.com/v3/__https:/mo.ibrahim.foundation/forum__;!!HhhKMSGjjQV-!unnPuNamiDJCvPT0R0iyM-bEsbnIRpk5OYAUVNvpajGcNb0OLiLNuCWLWoXK9FthFZR7K0lpaX2SwOODWw$" target="_blank" rel="noreferrer noopener">Ibrahim Forum</a> focused on the impact of COVID-19 on Africa and the continent’s path to recovery.

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The Future of Africa

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="546" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-820x546.jpg" alt="" class="wp-image-409988" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-820x546.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-120x80.jpg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-768x511.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-1536x1022.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/BONOBO-on-tree-branch_DRC-forest_shutterstock_550406149-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>BONOBO on tree branch_DRC forest_shutterstock_550406149</figcaption></figure>



The paradox of Central Africa is that it constellates countries extremely rich in natural resources needed for global development, yet these countries cannot finance their development agendas without recourse to expensive loans and aid with attached strings. The situation becomes dire when faced with externalities such as plummeting commodity prices or a pandemic such as COVID-19. But this ought never to be so!



Among the many metaphors used to deplore the situation and reawaken the spirits of citizens of this sub-region to take their destiny in their own hands, is that of a royal personage sitting on a golden chair, but with a cap-in-hand, asking for pieces of silver and bank notes from visitors and passers-by. In this write-up, we argue that it is time for Central Africans to get up from that stool, literally count their blessings and transform their economies using those blessings. And natural capital accounting (NCA) is one major way to do this.



So, what is natural capital accounting?



Natural Capital Accounting (NCA) is a rigorous audit of the economic worth and monetary value of a country’s natural resources, to assess its real wealth, sustainably plan its development and better bargain for development finance without sinking into debt (as is currently the case with several Central African economies).



NCA is a relatively new tool in environmental management. It assesses the natural ecosystems’ contributions to a country’s economy, its level of reliance on natural systems, tracking changes in these natural systems and its impacts. It can be understood as a new (and better) way of combining existing tools used in economic analysis with environmental data. In other words, if GDP is measured in terms of the total value of goods and services produced within an economy in a year, natural resources which offer ecological and other services ought to be included in the equation in assessing the true wealth of a nation.



We contend that the gains to be made from mainstreaming NCA into national accounts and the overall scheme of wealth measurement in Central Africa are manifold. Below, the 4 issues to note:



1) NCA will enable a change of course in our development trajectory



A systematic count of a country’s natural capital and its ecological services provides solid pointers to leaders in formulating and finetuning development policies and interventions in areas such as the environment, forest management, agroindustry, local government, green and blue economy. Moreover, it can help mobilize innovative financing for a faster transition to green growth and lessen the dependence on the export of raw materials such as oil.



Let us explicate this point with a clear example.



Central African countries have a huge potential of renewable energy totalling an estimate of 16,724,190 megawatt (MW). Of this estimate, hydro takes 126,990 MW, solar 14,751,375 MW, and wind takes 1,844, 125 MW. Specifically, the Democratic Republic of the Congo (DRC) is blessed with huge hydropower potential, including the world’s second largest river by volume – the Congo River. While two dams built on



the stretch of the river more than three decades ago, Inga I and Inga II, provide most of the nation&#8217;s power, with capacities of 351 MW and 1,424 MW respectively, they are far from meeting the country’s electricity needs and far from making the most use of the Inga rapids which have an untapped hydropower potential of more than 40,000 MW. This potential could be exploited by the Inga III Project (with an estimated capacity of 4,500 MW) and the later phases of the Grand Inga scheme (with an estimated capacity of 40,000 MW). The Grand Inga, which, if materialized in six phases, would be the world’s largest hydropower project could supply Africa with an additional 40,000 megawatts of electricity.



The subregion is also home to huge potential in solar and wind energy. Particularly, Chad and the northernmost parts of Cameroon, in the same neighborhood present unmissable opportunities for solar and wind energy production as a United Nations Economic Commissions for Africa (ECA) preliminary geospatial data driven analysis on economic opportunities along Central Africa’s transport corridors has established. The area boasts an average of 22, 000 kilojoules per meter square of solar irradiation per day and a wind power density of more than 42 joules per cubic meter.



These vast renewable energy resources can be harnessed to diversify the economies away from fossil fuels and meet the increasing domestic energy needs, critical to achieving sustainable development and green growth as well as contributing to the global climate change mitigation efforts. And to do so, Central Africa can take advantage of climate change investments.



In the same vein, Central Africa can take advantage of the global race to zero emissions for climate change mitigation to climb the global value chain. Truly, the net-zero carbon pledges require significant quantities of critical minerals such as cobalt, lithium, copper and manganese and various rare earth metals whose production is expected to grow nearly sevenfold between 2020 and 2030 in the net zero pathway. In this context, and with its 2/3 of the identified world reserves of cobalt (more than 25 million tons), the DRC has a unique opportunity of being at the heart of the dynamic battery value chain and the electric vehicle- (BEV)- revolution, and renewable energy deployment. Unfortunately, the DRC is still locked in the mining and mineral processing stage, and at the bottom of the global value chain, currently capturing only 3% of a total global value that is expected to reach US$ 8.8 trillion by 2025. To break this vicious cycle, the country has to improve the linkages between the extractive sector and other sectors of the local economy. Through natural capital accounting, such explicit linkages would have been established to give to the DRC, the subregion and Africa as a whole a leverage to integrate the global supply chain of BEV critically needed to feed the world’s race to net-zero emissions.



The above examples don’t tell the whole story, there are many other areas in the subregion where similar huge potentials are sitting, unknown, and therefore not accounted for in development planning. NCA will help identify and value these potentials, providing baseline data and practical frameworks that can be used to formulate and implement policies and strategies to accelerate the attainment of the SDGs and Agenda 2063, at country or subregional level.



2) NCA can enhance sustainable development and greatly expand fiscal space for development



Central Africa’s wealth will be better known by correctly measuring and valuing its natural capital and associated services and activities that were previously unrecorded or undervalued. A better valuation of the natural capital of a country will increase its reported net wealth and will open the way for its inclusion in GDP, and rebasing of national wealth. Not to mention that, if a country can continuously measure its stock



of renewable resources, it can monitor their use and therefore design policies that will result in higher well-being without destroying irreplaceable assets such as the stock of biodiversity.



&#8220;GDP tells you nothing about sustainability&#8221;, said Joseph Stiglitz. However, with a reliable natural capital accounting system, a country can produce a set of indicators that will efficiently complement GDP to monitor its sustainable development. Appetite and political commitment for this is not huge yet…



Even so, and as said earlier, Central African countries can also leverage their natural capital to mobilize innovative financing and expand the fiscal space necessary for adopting counter-cyclical measures to accelerate economic diversification and build forward better, which is important to do, in times of crisis such as the COVID-19 pandemic, which has aggravated the already precarious debt situation of the subregion in particular, and Africa in general.



While liquidity-richer countries have kept their economies afloat in spite of lockdowns through stimulus packages, Central Africa, like the rest of the continent, has not been able to provide such incentives to businesses and citizens, resulting in a 6.6% loss of GDP. It is a double jeopardy of economic and health service decline, which a broader fiscal space would have cushioned.



From simulations by ECA showing that debt servicing obligations may mean many African countries devote more than half of their GDP to debt-servicing in the early 2020’s, there must be a way out with NCA. The ecological services provided to the rest of the world by the Congo Basin Forests (considered the second biosphere and lung of the planet) must be quantified and monetized to expand such a fiscal space. ECA, UNEP and UNDP are currently working with the Government of Gabon to use NCA to audit its forests and determine the exact value of the carbon sink they provide to help store greenhouse gases from worsening the global climate challenge. Less than 1% of the country’s 230,000 square km of forest has been depleted. This is natural capital that should be paid for via innovative green and climate financing mechanisms such as the Green Funds, and Green and Blue Bonds, as well as debt-for-climate adaption swaps.



Next door, the Republic of Congo and the Democratic Republic of Congo do not only equally hold vast swathes of forests canopy but jointly possess a powerful source of carbon sequestration – a 245,000 km square peatland belt. The peatlands trap 30 billion tons of greenhouse gases equivalent to three years of global carbon emissions. Central African countries should clearly flag this natural ecological support to the rest of the world, monetize it and demand payments. The demarche will spare them from making the painful choice between short-term objectives of restoring macroeconomic equilibrium and the long-term objective of placing their economies on a trajectory of sustained and inclusive growth through economic diversification and structural transformation, during crises periods as the COVID-19 pandemic. Now is the time to do it.



3) Where should we start from?



Of course, the first thing to do is to map, delineate and evaluate all the natural resources (renewable and non-renewable) assets available in the sub-region. If we don’t know what we have and where we have it, we can’t get the most out of natural resources.



We also need to build register or cadastral systems, and make relevant information, including licenses, publicly available and accessible online in open data format, in line with EITI1 requirements of full disclosure of information. This will improve governance and transparency in the management of the sector.



We also must address the technical and institutional barriers to the establishment of routinely produced environmental-economic accounts at the national levels, focusing on: 1) building the institutional framework in support of the NCA implementation; 2) training of local technical experts (including scientists, economists, statisticians, policy specialists) to compile priority accounts on a regular basis and to strengthen their capacity in negotiating new licensing schemes, in which, for example, preserving natural capital could be part of the biddable factors; 3) fostering inter-institutional relationships to promote collaboration and data-sharing; and 4) promoting the effective communication and use of NCA in supporting evidence-based policy and the SDGs. We have started doing this in Gabon. We must do it systematically across the entire sub-region.



4) We need a new and green deal



The recent external shocks that many Central African countries have suffered due to the sharp drop in world oil prices and the need to finance development in the post-Covid-19 era should be a wakening call for our sleeping king. Central Africa needs to move from a brown growth which has sunk the sub-region to a vicious cycle of booms and busts, to a green growth model which harnesses the full potential of the sub-region natural capital and its ecological services. We need to move from the resource for infrastructure model, to a resource for industrialization and sustainable development pathway. This is a compact that requires the involvement of several stakeholders including governments, financial institutions, local and international communities, large and small companies, and ordinary citizens.



Natural capital accounting is central to this transition! With it, we must rebase key indicators of wealth, and rightfully press for payments for the ecological services provided by the subregion in its forest, subterranean and submarine carbon sinks to expand fiscal space.



In line with the Decade of Economic Diversification in Central Africa declared in November 2020, our Decade of Action in Central Africa must contribute to rapid economic diversification and structural transformation of economies, moving up Central Africa’s participation in global chains, including in the battery, electric vehicle and renewable energy industry. This is the objective of the DRC-Africa Business Forum on “Fostering the development of a battery, electric vehicle, and renewable energy industry value chain and market in Africa, which the government of DRC, ECA, Afreximbank, Africa Finance Corporation, and BADEA are organizing in Kinshasa, DRC in September 2021. See you in Kinshasa. 



<a href="https://www.uneca.org/events/central-africa/drc-business-forum">https://www.uneca.org/events/central-africa/drc-business-forum</a>



===============



*Antonio Pedro heads the Subregional Office for Central Africa of the United nations Economic Commission for Africa (ECA). Nadia Ouedraogo and Issoufou Seidou are economists in that Office while Abel Akara Ticha is the Office’s communication Officer

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Using what you have to get what you want: why Central African countries must put natural capital accounting at the centre of their development

In the face of overwhelming adversity and strife, it is a natural human emotion to withdraw from the crisis. Last night, as my executive team and I at MTN ended yet another crisis update, a wave of despondency hit me, and I said out loud, to no one in particular, “I have no more words.” &nbsp;



But that doesn’t help, does it? It doesn’t help to have no words. It doesn’t help to remain quiet, to focus only on what matters to my family and the business I happen to run. &nbsp;



As I write this, MTN South Africa has closed over 100 stores mostly in Gauteng and KwaZulu Natal. Over 100 base stations are currently down, and our technicians can’t safely reach the sites for repairs, due to the ongoing unrest. Over 1000 MTN employees can’t get to work and millions of calls and queries from our customers cannot be attended to, as our primary call centre remains inaccessible. MTN South Africa directly and indirectly creates employment for over 20 000 people but we are obviously not the only business going through this. The negative multiplier effect of halted business is further crippling our economy, which was just starting to show some small green shoots of recovery, from the pandemic.&nbsp;&nbsp;&nbsp;



While the outlook has been bleak this week, I’ve found some solace reflecting on our roots, as MTN and as a nation. Our company was born out of South Africa’s democracy, which prioritised peace, diversity and inclusion over a history of division and hatred. We are a resilient people and while it might seem trite to say, “this too shall pass”, it’s true because we have been through tough times before. &nbsp;



We have confronted the most terrible of situations. We have emerged on the other side, battered and bruised, but having survived because South Africans made the conscious decision to choose peace over violence and dialogue over discord.&nbsp;



Consider some of the bleak situations we faced in the not-so-distant past. I look back at the political violence of the early 1990s as apartheid was crumbling and we were trying to usher in our hard-fought democracy. The townships were in flames, 500 people were dying every month, security forces were patrolling our streets inflaming the situation and neighbours fought neighbours. Yet we kept our eyes on the prize and ensured that democracy was not derailed. Against the expectations of the whole world, we patiently stood in the voting queues and vanquished apartheid. It was hailed as the peaceful revolution. We did that.&nbsp;



Consider how close we came to civil war when Chris Hani was assassinated one fateful Easter Saturday. But instead of heading over the precipice driven by anger into violent insurrection, we weathered the storm and ensured the peace process held firm.&nbsp;



We are currently going through one of the bleakest times in recent memory. We need to focus on what is important for us to survive as a nation. We cannot destroy all that we have fought so hard for. We cannot undermine the achievements of our democracy.&nbsp;



The future of all South Africans, rich and poor, big business and small business, profit for not-for-profit, can only be built on that ethos of democratic resilience and fortitude that repeatedly ushered us away from the precipice of ruin.&nbsp;&nbsp;&nbsp;&nbsp;



Now is a time for us to urgently reflect on what has gone wrong and how, as individuals and as one of the biggest companies and most respected brands in South Africa, we can ensure that we never fall into this pit of lawlessness and anger again.&nbsp;



South Africa’s future must be a country that belongs to all. We cannot be a nation of winners and losers, players and spectators. Education and digital infrastructure for all must be the foundation for a Mzansi that works for all its people.&nbsp;&nbsp;&nbsp;



We cannot afford to be complacent. This time we must look at the devastating economic and social conditions under which the vast majority of South Africans are forced to survive and, instead of tut-tutting about the situation, embark with purpose on a strategy and actions for meaningful and sustainable change. &nbsp;



At MTN, we are proud to provide services to, amongst many others, spaza shops, local hairdressers, small pharmacies and printers and other business services. But our commitment to those entrepreneurs, who are very often black owned and are carving out new businesses in previously under-served communities, is as unflinching as it is to our huge blue-chip clients. But the difference this week is that the blue-chips know they will survive, while the future is much less clear for the rest.&nbsp;&nbsp;&nbsp;



As big business, we have a responsibility to further prioritise the support of small businesses and I am calling for an accelerated and coordinated effort, particularly in the ICT sector, to help small businesses. A successful and sustainable South Africa needs large and small businesses prospering side by side. This requires big business to send more work the way of small and micro enterprises and we must do this not to maximise BBBEE points, but because it is one of the most impactful ways we can quickly reignite the economy. There is no time to waste. Many parts of the world are already shaking off the effects of Covid-19 and we cannot afford to once again, be left behind. &nbsp;



At MTN, we have an unshakeable faith in South Africa. We continue to invest, to build a world-class communication infrastructure, to serve our 33 million customers and we will continue to work with our business partners, regulators, government and all our stakeholders. And we do so because we remain clear that the majority of South Africans are simply seeking to achieve the most basic of human endeavours, which is to give our children better than what we ourselves received. &nbsp;



I have lived in many countries across this continent. I have witnessed the scourge of violence and have seen the long crippling effects thereof. But I have also seen countries that have chosen peace, dialogue and inclusive growth, emerge stronger. We have that. Whether it is communities clearing up debris or delivering food parcels to the needy, the relentless optimism of South Africans is already visible.&nbsp;&nbsp;&nbsp;



South Africa will survive. It always does. But as we emerge on the other side, battered and bruised, we must pledge that this will not happen again. Not on our watch. The time for action is now. &nbsp;



ENDS

Sisonke, Big business and small business need each other now more than ever

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="561" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-820x561.jpg" alt="" class="wp-image-409179" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-820x561.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-300x205.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-117x80.jpg 117w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-768x526.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k-1536x1052.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/32950016298_bbe521e8bf_k.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>President Cyril Ramaphosa attends Basic Education Lekgotla, 21 Jan President Cyril Ramaphosa addresses the 3rd Basic Education Lekgotla at Birchwood Hotel in Boksburg. (Photo: GCIS)</figcaption></figure>



Dear Fellow South African,



Starting and building a business is a lot like raising a family. It takes time, patience, constant support, and consistent nurturing from infancy to maturity. For many business owners, seeing a business that you grew from scratch struggling to survive, or even being forced to close its doors, is heartbreaking.



Since the onset of the Covid-19 pandemic, this has sadly been the situation facing many businesses both large and small, not just in our country but around the world. Many have had to reduce the working hours of their staff or even retrench them.



The pandemic and the measures we have had to take to contain the spread of the virus have had a detrimental impact on businesses.



In dealing with the pandemic we have sought to adopt an evidence-based approach in both policy and practice, considering scientific research, clinical expertise and capabilities, and impact on all sectors of the population. We have sought to have a balance between saving lives and preserving livelihoods.



We have sought to mitigate the impact of the successive lockdown restrictions on people’s livelihoods, or risk a second and possibly worse epidemic of poverty and hunger in future.



In the earliest days last year, we introduced measures such as the Covid Temporary Employer/Employee Relief Scheme (TERS), the Covid-19 Loan Guarantee Scheme and various mechanisms to support small businesses to provide immediate and short-term relief to burdened employees and business owners. In addition, the special Covid-19 Social Relief of Distress grant and broadening access to existing social grants provided lifelines to indigent individuals and families.



Through these interventions we were able to mitigate the worst effects of the pandemic, preventing the closure of many businesses and the loss of even further jobs. They provided a firm foundation for the Economic Reconstruction and Recovery Plan that we launched in October last year.



As part of that plan, we introduced the Presidential Employment Stimulus to provide income and livelihood support to millions of beneficiaries. Through the stimulus, over 300 000 young people have been placed as school assistants. More than 100 000 subsistence farmers are registered on the first-ever database of its kind where they have access to technical support. More than 30 000 young people have been given opportunities in the cultural, creative and sports sectors. Young professionals have been given opportunities in infrastructure development, healthcare, environmental conservation and a number of other sectors.



There are promising indications that our economy is steadily recovering, with growth and job creation in a number of sectors, from manufacturing to mining to agriculture.



At the same time we know that this ‘bigger picture’ is cold comfort to workers and business owners who have suffered immeasurably over the past year and a half, and were hoping to see their situations improve in as the economy slowly opened up.



The rapid rise in infections being fuelled by the new Delta variant has necessitated that we impose tighter restrictions on the movement of persons, on the operation of certain businesses and on public gatherings, among others.



As I said last night in my address to the nation, these have not been easy decisions to make, mindful as we are of their impact on people’s livelihoods.



Just as we did at the beginning of the pandemic, we have been engaged in deliberations with all social partners, business, labour and civil society to see what financially sustainable measures we could introduce to support businesses and individuals in distress at this time.



The negotiations at Nedlac have resulted in consensus that the most practical and financially sustainable measure that can provide urgent relief is extending the Covid-19 TERS scheme to sectors that are affected by the adjusted level 4 restrictions.



We will soon publish the details of this extension, including details on who is eligible.



To support businesses whose operating licenses and permits expired between March 2020 and June 2021, we are extending their validity until 31 December 2022. In addition, new business licenses or permits that are issued from the 1 July will also be valid until 31 December 2022, and no license fee will be payable.



Certain businesses that were initially not allowed to operate under the adjusted Level 4 regulations will be permitted to reopen under strict health conditions. This will bring great relief to not just business owners but workers, especially in industries such as hospitality.



Over the past year, we have also been working consistently to protect vulnerable workers whose jobs were at risk, particularly in hard-hit sectors like retail, food and beverage and the metals industry. Through processes facilitated by the CCMA some 58 000 jobs have been saved.



With the pandemic showing no immediate signs of ending, businesses and workers remain vulnerable.



It is thanks to the social compacts we continue to forge that government, business and labour have been able to work together to buffer workers and businesses from the pandemic’s harsh economic impacts.



For now, our priority is saving lives, and ensuring that we provide the necessary support, within our means, to prevent more businesses closing down and more jobs being lost.



As we did with the Covid-19 TERS scheme, government is firmly committed to continue its engagements with business and labour to find a way through these distressing times that both saves lives and protects livelihoods.



With best regards,



Cyril Ramaphosa

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From the president’s desk: Government interventions yielding some positive results for economy

PARIS/NEW YORK, 12 July 2021 –&nbsp;“It’s been 18 months since the COVID-19 outbreak started and education for millions of children is still disrupted. As of today, primary and secondary schools are shuttered in 19 countries, affecting over 156 million students.



“This should not go on.&nbsp;Schools should be the last to close and the first to reopen.



“In their efforts to limit transmission, governments have too often shut down schools and kept them closed for prolonged periods, even when the epidemiological situation didn’t warrant it. These actions were frequently taken as a first recourse rather than a last measure. In many cases, schools were closed while bars and restaurants remained open.



“The losses that children and young people will incur from not being in school may never be recouped. From learning loss, mental distress, exposure to violence and abuse, to missed school-based meals and vaccinations or reduced development of social skills, the consequences for children will be felt in their academic achievement and societal engagement as well as physical and mental health. The most affected are often children in low-resource settings who do not have access to remote learning tools, and the youngest children who are at key developmental stages.



“The losses for parents and caretakers are equally heavy. Keeping children at home is forcing parents around the world to leave their jobs, especially in countries with no or limited family leave policies.



“That’s why reopening schools for in-person learning cannot wait.



“It cannot wait for cases to go to zero. There is clear evidence that primary and secondary schools are not among the main drivers of transmission. Meanwhile, the risk of COVID-19 transmission in schools is manageable with appropriate mitigation strategies in most settings. The decision to open or close schools should be based on risk analysis and the epidemiological considerations in the communities where they are situated.



“Reopening schools cannot wait for all teachers and students to be vaccinated. With the global vaccine shortages plaguing low and middle-income countries, vaccinating frontline workers and those most at risk of severe illness and death will remain a priority. All schools should provide in-person learning as soon as possible, without barriers to access, including not mandating vaccination prior to school entry.



“Ahead of the Global Education Meeting on July 13, we urge decisionmakers and governments to prioritize the safe reopening of schools to avoid a generational catastrophe.



“Closing schools mortgages our future for unclear benefits to our present. We must prioritize better. We can reopen schools safely, and we must.”

Reopening schools cannot wait

pxfuel.com_

Are Tech Giants the 4th Tier of Government?

Sub-Saharan Africa is in the grips of a third wave of COVID-19 infections that threatens to be even more brutal than the two that came before.



This is yet more evidence of a dangerous divergence in the global economy. One track for countries with good access to vaccines, where strong recoveries are taking hold. And another for those countries that are still waiting and at risk of falling further behind.



<div class="wp-block-image"><figure class="alignleft size-large is-resized"><img loading="lazy" decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart1-blog28_original-756x800.png" alt="native" class="wp-image-408128" width="381" height="403" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart1-blog28_original-756x800.png 756w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart1-blog28_original-283x300.png 283w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart1-blog28_original-76x80.png 76w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart1-blog28_original.png 768w" sizes="auto, (max-width: 381px) 100vw, 381px" /></figure></div>



The growth of infections in sub-Saharan Africa is now the fastest in the world, with an explosive trajectory that is outpacing the record set in the second wave. At this pace, this new wave will likely surpass previous peaks in a matter of days—and in some countries, infections are already more than double, or even triple, their January peaks. The latest (delta) variant—reportedly 60 percent more transmissible than earlier variants—has been detected in 14 countries.



When the pandemic first hit, quick action by policymakers helped prevent infection rates seen elsewhere around the world. But it pushed already strained local health systems to the breaking point. Only six months after the initial crisis, the region experienced a second wave that swiftly outpaced the scale and speed of the first. Now, another six months on, sub-Saharan Africa faces its third devastating wave.



The only way for the region to break free from this vicious pandemic cycle is to swiftly implement a widespread vaccination program.



<h2 class="wp-block-heading" id="h-a-still-vulnerable-region">A still-vulnerable region</h2>



The sheer speed of this third wave highlights the difficulty policymakers in sub‑Saharan Africa face in heading off a crisis once it gets under way. In Namibia, for example, new cases reached the previous January peak within only two weeks, and&nbsp;tripled&nbsp;another two weeks later. For many countries, by the time a new surge is identified, it may already be too late.



And the options employed during previous waves may no longer be feasible. The re-imposition of containment measures would likely come at too high an economic and social cost, and is simply unsustainable—and unenforceable—over a prolonged period.



Looking back, most sub-Saharan African countries entered the second wave in a more difficult economic position than the first, with shrinking fiscal resources to protect the vulnerable, additional millions thrown into poverty, and depleted household balance sheets. While some countries have taken steps to improve preparedness, unfortunately, very few have had sufficient resources—or time—to strengthen public health systems.



And, now, the scale of the current wave is once again threatening to overwhelm local health systems. News reports across the region point to overwhelmed hospitals. The sick are dying while waiting for a bed. Non-emergency surgeries have been canceled to preserve space for COVID-19 patients. And military hospitals have been opened for civilian use. Oxygen has become a key constraint, with supply already failing to keep up with the demand for critically-ill patients. The region’s scarce health workers continue to be at risk.



<h2 class="wp-block-heading" id="h-the-risks-of-leaving-africa-behind">The risks of leaving Africa behind</h2>



The vaccine rollout in sub-Saharan Africa remains the slowest in the world. Less than 1 adult in every hundred is fully vaccinated, compared to an average of over 30 in more advanced economies. This means even most essential frontline workers continue to work unprotected. In this context, some of the world’s more fortunate countries have stockpiled enough vaccines to cover their populations many times over.



Without significant, upfront, international assistance—and without an effective region-wide vaccination effort—the near-term future of sub-Saharan Africa will be one of repeated waves of infection, which will exact an ever-increasing toll on the lives and livelihoods of the region’s most vulnerable, while also paralyzing investment, productivity, and growth. In short, without help the region risks being left further and further behind.



And the longer the pandemic is left to ravage Africa, the more likely it is that ever more dangerous variants of the disease will emerge. Vaccination is not simply an issue of local lives and livelihoods. It is also a&nbsp;global&nbsp;public good. For every country—everywhere—the most durable vaccine effort is one that covers&nbsp;everyone, in every country.



<h2 class="wp-block-heading" id="h-what-can-be-done-to-speed-up-the-vaccine-effort">What can be done to speed up the vaccine effort?</h2>



<div class="wp-block-image"><figure class="alignleft size-full is-resized"><img loading="lazy" decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart2-blog28_original.png" alt="native" class="wp-image-408129" width="395" height="394" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart2-blog28_original.png 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart2-blog28_original-300x300.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart2-blog28_original-80x80.png 80w" sizes="auto, (max-width: 395px) 100vw, 395px" /></figure></div>



IMF staff has put forward a global&nbsp;<a href="https://www.imf.org/en/Publications/Staff-Discussion-Notes/Issues/2021/05/19/A-Proposal-to-End-the-COVID-19-Pandemic-460263?utm_medium=email&amp;utm_source=govdelivery">proposal</a>&nbsp;that targets vaccinating at least 40 percent of the total population of all countries by end-2021, and at least 60 percent by the first half of 2022. Africa is expected to receive 30 percent vaccination coverage through COVAX and another 30 percent coverage through the African Vaccine Acquisition Task Team (AVATT), established by the African Union under the leadership of President Cyril Ramaphosa.



We see seven key steps to ensure these vaccination targets are met:



<ul class="wp-block-list"><li>First, it is essential to deliver vaccines to sub‑Saharan Africa as soon as possible. Given that much of the global supply of vaccines for 2021 has already been bought up, many countries will be forced to wait until 2022 to get them. So, the fastest way to get vaccines to sub‑Saharan Africa is for advanced economies to share their stockpiles bilaterally or through multilateral initiatives. COVAX has already received pledges for over half a billion doses. But these need to turn into actual deliveries as soon as possible to make a difference. Indeed, the goal should be to get a quarter of a billion doses to the region by September.</li><li>Second, vaccine manufacturers should speed up supply to Africa for the rest of this year. Advanced economies with vaccine manufacturing capabilities should encourage their manufacturers to do so, especially when demand at home is falling short of supply.</li><li>Third, AVATT should be fully financed to ensure coverage of 30 percent of the African Union population. This requires an estimated $2 billion, that would for example allow AVATT to execute its optional contract of 180 million doses with J&amp;J.</li><li>Fourth, remove cross-border export restrictions on raw materials and finished vaccines. This includes ensuring that the Aspen facility in South Africa—a key supplier to AVATT—is operational at full capacity, and resuming exports from the Serum Institute of India to COVAX. African vaccination plans rely heavily on these two facilities.</li><li>Fifth, financing of at least $2.5 billion and upfront planning will also be critical to ensure health systems can deliver shots-in-arm promptly as vaccine supply ramps up. Many countries in the region, including eSwatini, Ghana, Kenya, Namibia, and Rwanda, have quickly and effectively administered their limited supplies. These countries, along with others in the region, have had to place their vaccine campaigns on hold as they wait for the arrival of the new supplies that they have recently procured at comparatively high cost or the donated supplies from other countries’ stockpiles. It is these shortages—rather than the ability to administer shots—that has so far been the biggest constraint. But when supply picks up, health systems must be prepared to vaccinate as many people as possible. And this is doable as the experience in many developing countries show—the likes of Seychelles, Mongolia, Bhutan, and Maldives impressively scaled-up vaccinations quickly once their vaccine supplies arrived.</li><li>Alongside vaccination efforts, countries must also ensure that their public health systems are able to handle an influx of cases. This includes accelerating the acquisition of vital COVID-19 health tools, including therapeutics, oxygen, and personal protective equipment. No matter what the speed of vaccinations, these supplies are needed now to help save lives. This will require urgent grant financing to pre-emptively procure and deliver a minimum package of critical COVID-19 Health Tools to address the rising health and economic costs arising from the surge in cases driven by the delta variant.</li><li>Finally, the magnitude of the region’s financing needs requires a coordinated effort on the part of the international community. Few countries have the fiscal space to finance this effort on their own, considering the region’s already elevated debt levels and already pressing spending needs. Most of the international community’s financial assistance will need to come in the form of grants or concessional loans. With our colleagues from the World Bank, WHO, WTO, and others, the IMF has formed a special task force to ensure that countries get the resources and vaccines they need.</li></ul>



<div class="wp-block-image"><figure class="alignleft size-full is-resized"><img loading="lazy" decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart3-blog28_crop.png" alt="native" class="wp-image-408130" width="393" height="447" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart3-blog28_crop.png 560w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart3-blog28_crop-264x300.png 264w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/chart3-blog28_crop-70x80.png 70w" sizes="auto, (max-width: 393px) 100vw, 393px" /></figure></div>



As always, Africa can count on the IMF. We remain deeply committed to all countries in the region. We’ve ramped up our lending to sub‑Saharan Africa—last year it was more than 13 times our annual average—and support to increase our access limits will allow us to scale up our zero-interest lending capacity. And the unprecedented $650 billion new SDR allocation, far and away the largest in the Fund’s history, once approved will make $23 billion available to member countries in sub‑Saharan Africa.



Yet the gravity and urgency of the situation requires the global community working together. We all have a stake in this. So, in all countries—advanced and emerging alike—we can reclaim our physical and economic health from the pandemic. And so that sub‑Saharan Africa can resume its path toward a more prosperous future.

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Sub-Saharan Africa: We need to act now.

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972-820x547.jpeg" alt="" class="wp-image-407861" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972-820x547.jpeg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972-300x200.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972-120x80.jpeg 120w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972-768x512.jpeg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/06/pexels-photo-4198972.jpeg 1124w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>Stock image via Pixels</figcaption></figure>







Rising world food prices for producers are making headlines and causing concerns among the public. The most recent data show a moderation in consumer food price inflation globally, but as we explain below, that could change in the coming months.&nbsp;This would only add to the high prices that consumers in many countries already lived through last year.



If prices eventually rise again, there will likely be sizeable differences between countries. Due to various factors, it is probable that the effect would be felt most by consumers in emerging markets and developing economies still wrestling with the effects of the pandemic.



Fact #1: Food price inflation started increasing before the pandemic.



The increase in consumer food price inflation predates the pandemic. In the summer of 2018, China was hit by an outbreak of African swine fever, wiping out much of China’s hog herd, which represents more than 50 percent of the world’s hogs. This sent pork prices in China to an all-time high by mid-2019 creating a ripple effect on the prices of pork and other animal proteins in many regions around the world. This was compounded by the introduction of Chinese import tariffs on US pork and soybeans during the US-China trade dispute.



<div class="wp-block-group"><div class="wp-block-group__inner-container is-layout-flow wp-block-group-is-layout-flow">
<h2 class="wp-block-heading" id="h-chart-1-food-prices">Chart:1 Food Prices</h2>



<figure class="wp-block-image"><a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDQsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMS8wNi8yNC9mb3VyLWZhY3RzLWFib3V0LXNvYXJpbmctY29uc3VtZXItZm9vZC1wcmljZXMvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.qaK0ZT-agerz3Q3yTa8fK2xROiuFyTgSMPQuIknAGho/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2021/06/4665970/chart1-food_original.png" alt="native"/></a></figure>
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 Fact #2: Early lockdown measures and supply chain disruptions induced a spike in consumer food prices.



At the start of the pandemic, food supply chain disruptions, a shift from food services (such as dining out) towards retail grocery, and consumer stockpiling (coupled with a sharp appreciation of the US dollar) pushed up consumer food price indices in many countries—with consumer food inflation peaking in April 2020—even though producer prices of primary commodities, including food and energy, were declining sharply as demand for primary food commodities was disrupted. By early summer 2020, however, various consumer food prices had moderated, pushing down consumer food inflation in many countries.



So while food prices at your grocery store (i.e., consumer food prices) may have increased, it is an exaggeration to say that they are currently rising at their fastest pace in years. They are also not currently contributing to headline inflation, though they may do so later this year and in 2022 (see the outlook below). Producer prices, on the other hand, have recently soared (see fact #4). But it takes at least 6-12 months before consumer prices reflect changes in producer prices. Also, on average, the pass-through from producer to consumer prices is only about 20 percent. This is because consumer food prices include the shipping costs of primary food commodities, the processing, marketing and packaging of food, and final distribution costs such as transport costs.



The last two facts will help us understand what to expect for consumer food prices.



<figure class="wp-block-image"><a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDUsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMS8wNi8yNC9mb3VyLWZhY3RzLWFib3V0LXNvYXJpbmctY29uc3VtZXItZm9vZC1wcmljZXMvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.TB05pduhJHQs5EIhWxFLRIRrsGQpmBnIf5vQ5sFpvwo/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2021/06/4665979/chart2-food_original.png" alt="native"/></a></figure>



 Fact #3: Soaring shipping and transport costs.



Ocean freight rates as measured by the Baltic Dry Index (a measure of shipping costs) have increased around 2-3 times in the last 12 months while higher gasoline prices and truck driver shortages in some regions are pushing up the cost of road transport services. Higher transport costs will eventually increase consumer food inflation.



<figure class="wp-block-image"><a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDYsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMS8wNi8yNC9mb3VyLWZhY3RzLWFib3V0LXNvYXJpbmctY29uc3VtZXItZm9vZC1wcmljZXMvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.mNxV1K_Ad-vV1JpQQJwaOhxzOiQJEU14kqnfPfpxfnE/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2021/06/4665985/chart3-food_original.png" alt="native"/></a></figure>



 Fact #4: Global food producer prices have rallied reaching multi-year highs.



From their trough in April 2020, international food (producer) prices have increased by 47.2 percent attaining their highest (real) levels on May 2021 since 2014 (highest level ever in current dollar terms).&nbsp; Between May 2020 and May 2021, soybean and corn prices increased by more than 86 and 111 percent, respectively.



<figure class="wp-block-image"><a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDcsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMS8wNi8yNC9mb3VyLWZhY3RzLWFib3V0LXNvYXJpbmctY29uc3VtZXItZm9vZC1wcmljZXMvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.X-LbdEwqhXKH1biHx1skmtFQznPcTAGhMXJmzILdtzU/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener"><img decoding="async" src="https://content.govdelivery.com/attachments/fancy_images/USIMF/2021/06/4665991/chart4-food_original.png" alt="native"/></a></figure>



 There are three main factors behind the recent rally in producer prices: (1) Demand for staples for both human consumption and animal feed has remained high, especially from China, as countries have stockpiled food reserves due to pandemic-related worries about food security. (2) The recent 2020-2021 La Niña episode—a global weather event occurring every few years—has led to dry weather in key food exporting countries, including Argentina, Brazil, Russia, Ukraine, and the United States. This has caused, in some cases, harvests and harvest outlooks to fall short of expectations. As demand has outpaced supply, US and world stocks-to-use ratios—a measure of market tightness—reached multi-year lows for some staples. (3) Strong demand for biofuels increased speculative demand by non-commercial traders, and export restrictions are additional factors supporting world producer prices.



<h2 class="wp-block-heading" id="h-outlook">Outlook</h2>



Based on the four facts presented, it is plausible that consumer food price inflation will pick up again in the remainder of 2021 and 2022. Indeed, the recent sharp increase in international food prices has already slowly started to feed into domestic consumer prices in some regions as retailers, unable to absorb the rising costs, are passing on the increases to consumers. More is likely to come, however, since international food prices are expected to increase by about 25 percent in 2021 from 2020, stabilizing in 2021. A pass-through of 20 percent (13 percent in the first year and 7 percent in the second) would, thus, imply an increase in consumer food price inflation of about 3.2 percentage points and 1.75 percentage points on average in 2021 and 2022, respectively. An additional 1 percentage point to the 2021 global consumer food inflation could be added by the higher freight rates. &nbsp;



The impact, however, will vary by country. Consumers in emerging markets could experience even higher increases due to the higher dependency on food imports (e.g. countries in sub-Saharan Africa and the Middle East and North Africa). The pass-through from producer prices to consumer prices also tends to be larger for emerging markets. For low-income countries struggling from the pandemic, the effects of further food inflation could be dire and risk a backslide in efforts to eliminate hunger.



Emerging markets and low-income countries are also more vulnerable to food price shocks because consumers in these countries typically spend a relatively large proportion of their income on food. Finally, for emerging markets and developing economies an additional risk factor is the currency depreciation against the US dollar—possibly due to falling export and tourism revenues and net capital outflows. Since most food commodities are traded in US dollars, countries with weaker currencies have seen their food import bill increase.



<a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDgsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvYmxvZ2dlcnMvY2hyaXN0aWFuLWJvZ21hbnMvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.o5-T2HJOiqYMK1iJFXmifypJft-wKMaV38dYAOpZpJw/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener">Christian Bogmans</a>&nbsp;is an economist in the IMF’s Research Department.



<a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDksInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvYmxvZ2dlcnMvYW5kcmVhLXBlc2NhdG9yaS8_dXRtX21lZGl1bT1lbWFpbCZ1dG1fc291cmNlPWdvdmRlbGl2ZXJ5In0.n3tiDb9nB0xJT0JXZt9u84NxONRDiRBOm1YxjTtg3g4/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener">Andrea Pescatori</a>&nbsp;is an economist in the IMF&#8217;s Western Hemisphere Department.



<a href="https://lnks.gd/l/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMTAsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMTA2MjQuNDIzNTA0MTEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvYmxvZ2dlcnMvZXJ2aW4tcHJpZnRpLz91dG1fbWVkaXVtPWVtYWlsJnV0bV9zb3VyY2U9Z292ZGVsaXZlcnkifQ.N2cMQWNBQ0efk2dEzlYbcQhxjfIUsRe2SUEOQQBoyB0/s/1121717145/br/108365982531-l" target="_blank" rel="noreferrer noopener">Ervin Prifti</a>&nbsp;is a senior economist with the IMF&#8217;s Research Department.

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Four Facts about Soaring Consumer Food Prices

The recent G7 Summit recognised the vital importance of ﬁnancing infrastructure projects in low- and middle-income countries across the world. Trains, roads, and ports will be ﬁnanced through the US led&nbsp;Build&nbsp;Back&nbsp;Better&nbsp;World&nbsp;Partnership&nbsp;(B3W),&nbsp;an&nbsp;alternative&nbsp;to&nbsp;China’s&nbsp;controversial&nbsp;Belt&nbsp;and&nbsp;Road&nbsp;initiative&nbsp;(BRI).



High quality, high performing, eﬃcient infrastructure is crucial to economic growth and an improved&nbsp;quality&nbsp;of&nbsp;life&nbsp;for&nbsp;any&nbsp;population.&nbsp;B3W&nbsp;represents&nbsp;a&nbsp;signiﬁcant&nbsp;opportunity&nbsp;for&nbsp;the&nbsp;democracies&nbsp;of&nbsp;the&nbsp;G7&nbsp;to narrow the $40+ trillion infrastructure gap. It is aimed at unlocking private capital to invest in projects&nbsp;to reduce the risks of climate change as well as promoting improvements in healthcare and digital&nbsp;technology.



Nigeria will be a critical test case for the B3W initiative. As Africa’s largest economy and most populous&nbsp;nation, Nigeria is potentially a super-power of the future. With more children born in Nigeria every day&nbsp;than in the whole of Western Europe combined, its already 200 million-strong population could well&nbsp;double by 2050, becoming the world’s second largest democracy. Based on these demographics, it is&nbsp;often thought of as a future giant of the global economy. Given that the G7 sees itself as the leading&nbsp;alliance&nbsp;of&nbsp;democracies,&nbsp;it should&nbsp;be&nbsp;supporting&nbsp;Nigeria’s economic&nbsp;growth.



Infrastructure projects are crucial to Nigeria’s economic future. They have necessarily been at the heart&nbsp;of&nbsp;President&nbsp;Muhammadu&nbsp;Buhari’s&nbsp;policy&nbsp;agenda.&nbsp;A&nbsp;wave&nbsp;of&nbsp;infrastructure&nbsp;projects&nbsp;have&nbsp;been&nbsp;completed,&nbsp;from&nbsp;the&nbsp;Kaduna&nbsp;to&nbsp;Abuja&nbsp;rail&nbsp;service,&nbsp;to additional&nbsp;terminals&nbsp;at&nbsp;the&nbsp;Nnamdi&nbsp;Azikiwe International&nbsp;Airport&nbsp;in&nbsp;the&nbsp;capital&nbsp;Abuja,&nbsp;as&nbsp;well&nbsp;as&nbsp;the&nbsp;Port&nbsp;Harcourt&nbsp;International&nbsp;Airport.



The&nbsp;Nigerian&nbsp;government&nbsp;has&nbsp;sought&nbsp;to&nbsp;leverage&nbsp;a&nbsp;range&nbsp;of&nbsp;international&nbsp;investment&nbsp;to&nbsp;promote&nbsp;industrial&nbsp;and&nbsp;structural&nbsp;change.&nbsp;The&nbsp;ambition&nbsp;is&nbsp;to&nbsp;develop&nbsp;and&nbsp;grow&nbsp;the&nbsp;Nigerian&nbsp;economy,&nbsp;modernising for the global energy transition away from its reliance on the oil industry. In particular, the&nbsp;government has secured Chinese investment in supporting job creation, none more so than the Lagos –&nbsp;Ibadan railway line, a $1.5bn scheme built by the China Civil Engineering Construction Corporation&nbsp;(CCECC).



China’s Belt and Road initiative has targeted the economies of Africa. The ostensible goal of the BRI is to&nbsp;connect a broad range of geographical regions by way of construction projects, including transport and&nbsp;economic corridors, to better connect the world’s second largest economy with the rest of the world.&nbsp;From the early 2000s onwards, China’s role in Africa has grown rapidly in respect of trade, investment&nbsp;and the ﬁnancing of infrastructure projects. There are now more than 40 African countries signed up to&nbsp;memorandums of understanding with China. Given this level of ﬁnancial support and the consequential&nbsp;political inﬂuence that follows, it is hardly surprising that the G7 countries should want to emulate&nbsp;China’s&nbsp;success.



Too often in the past, investment from Europe or the United States has focussed on longer term ﬁnancial&nbsp;services.&nbsp;In&nbsp;contrast&nbsp;China&nbsp;and&nbsp;Chinese&nbsp;companies&nbsp;have&nbsp;invested&nbsp;in&nbsp;practical&nbsp;projects,&nbsp;including&nbsp;transport&nbsp;infrastructure and manufacturing, involving immediate beneﬁts to the countries concerned. African&nbsp;countries will therefore be looking to the B3W to follow and compete with the Chinese model of&nbsp;investment in critical infrastructure. Moreover, in regions where the G7 countries are already heavily&nbsp;involved, such as the Sahel, developing core infrastructure will be a vital component in ensuring the&nbsp;long-term&nbsp;political stability&nbsp;of&nbsp;the region. This is the driving principle behind a 283km rail route between Nigeria and Niger commenced earlier this&nbsp;year,&nbsp;spearheaded&nbsp;by&nbsp;Nigeria’s&nbsp;Transport&nbsp;Minister&nbsp;and&nbsp;the&nbsp;Portuguese&nbsp;construction&nbsp;company,&nbsp;Mota-Engil – helping increase commercial activity in the region while aiming to establish Nigeria as the region’s&nbsp;central&nbsp;export hub.



Revitalising infrastructure links across West Africa and the Sahel is not only essential from a security&nbsp;standpoint, it is also an imperative for youthful population looking to develop and diversify their&nbsp;economic ambitions. Harnessing the potential of young people to play their part in promoting economic&nbsp;growth&nbsp;cannot&nbsp;be&nbsp;ignored.&nbsp;Cross-cutting&nbsp;collaboration&nbsp;between national&nbsp;governments&nbsp;and&nbsp;foreign&nbsp;investors is essential to ensure that Africa’s young demographic can access the full range of high quality&nbsp;public&nbsp;services that&nbsp;are currently&nbsp;lagging far&nbsp;behind those of&nbsp;the western&nbsp;world.



Lead by the United States, motivated as much by politics as economics, the G7 countries have now&nbsp;demonstrated&nbsp;a&nbsp;considerable&nbsp;appetite&nbsp;for&nbsp;investing&nbsp;in&nbsp;African&nbsp;infrastructure&nbsp;projects,&nbsp;providing&nbsp;a&nbsp;political&nbsp;and economic alternative to Chinese loans and investments. But if B3W is to be a success, both for the&nbsp;countries of the G7 and their prospective partners, it will have to be on more transparent and mutually&nbsp;beneﬁcial terms than China currently oﬀers. Given Nigeria’s growing global importance and scale of its&nbsp;challenges, the country represents a critical test case to determine whether the B3W can deliver on its&nbsp;promises.

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Why the Build Back Better World Partnership Should Be Looking to Nigeria

RMB CEO James Formby has commended government for finally taking the steps needed to tackle persistent power outages &#8211; but noted that it was an opportune time to capitalise on the move by taking further action on South Africa’s biggest economic challenges.&nbsp;



He also said that he was “cautiously hopeful” that the announcement of the sale of a 51% stake in SAA may result in financial independence for the airline and that its partial privatisation might even serve as a blueprint to help remove the burden other struggling SoEs have on the state’s coffers.&nbsp;



“South Africa’s future is brighter today with government announcing the Electricity Regulation Act would be amended to free up business and industry to invest in their own generation capacity.&nbsp;



“As such, we should see a material increase in new electricity supply within the next eighteen months. The economic multiplier effects associated with this will also be large. I trust processes around the registration of embedded generators and them obtaining the necessary grid connecting permits won’t get caught up in red tape”.&nbsp;



The licensing threshold means embedded generation projects can now produce up to 100 megawatts (MW), dramatically higher than the previous limit of 1MW.&nbsp;



“This, along with further progress in vaccinations, will help lift the national mood and improve investor confidence somewhat.&nbsp;



“It’s a really good time to use this momentum to grasp the nettle of our other key challenges and change South Africa’s growth trajectory.”&nbsp;



He said that a renewed policy focus on logistics was currently particularly important given South Africa is riding the commodity price boom, a rare gift to the SA economy.



<blockquote class="wp-block-quote is-style-large is-layout-flow wp-block-quote-is-layout-flow">“We need to ensure our exports can get out of South Africa in the most efficient and cost-effective way possible, so we can fully benefit as a country. At the moment we are hamstrung by bottlenecks in rail transport and resultant over reliance on expensive road transport.</blockquote>



“There are plans to allow greater participation of the private sector in container ports and the rail network, but plans must now turn into action.”&nbsp;



Formby said that a much more proactive approach was needed to resolve the vexed spectrum issue.&nbsp;



“All parties should be sitting around a table, not in the courtroom.



<figure class="wp-block-pullquote"><blockquote>“Speedier allocation of extra spectrum would unleash much new investment in telecom infrastructure which, among other factors, should help further reduce the cost of data and enable significant growth in this vital sector. South Africa has already waited too long for this policy change.”&nbsp;&nbsp;</blockquote></figure>



Formby also said that a plan to fix municipalities was also needed.&nbsp;



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“It’s a longer road but we need to re-skill municipalities to enable projects to repair ageing infrastructure alongside better financial management.”&nbsp;</blockquote>



Companies have increasingly expressed concerns about the additional costs they have to incur because of lack of delivery by municipalities. Poultry producer Astral has had long running water supply problems in Standerton, while Clover has just decided to shift their cheese plant from Lichtenburg in the North West to Queensburgh, Durban because of poor service delivery.&nbsp;



“For the current cyclical economic recovery to develop into a durable business-cycle upswing, jobs must be created, and for that to happen, fixed investment must accelerate.&nbsp;



<blockquote class="wp-block-quote is-style-default is-layout-flow wp-block-quote-is-layout-flow">“With increased collaboration between the public and private sector, South Africa now has an opportunity to create a sound platform which could serve us for years to come,” Formby concluded.&nbsp;</blockquote>

Embattled Power Company Eskom Holdings SOC Ltd. Reports Record Loss

After Eskom & SAA announcements, RMB CEO urges government to grasp nettle of further reforms

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="461" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-820x461.jpg" alt="" class="wp-image-400601" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-820x461.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-300x169.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-768x432.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-1536x863.jpg 1536w, https://cms.cnbcafrica.com/wp-content/uploads/2021/03/AAA_1696.1-scaled.jpg 2048w" sizes="auto, (max-width: 820px) 100vw, 820px" /></figure>



I was having an engaging Zoom chat about financial inclusion last week with a senior female executive when we were interrupted by her charming toddler who had other priorities. After some on-screen introductions and my poor attempt to entertain her child, she shared a personal reflection. Despite her partner being in an adjacent room, the little one tended to knock on her door frequently.



As we are now seeing in the data, the pandemic’s effect has added to the pressures experienced by women. Often women have had to pick up more household chores and childcare duties, and many have had to face unemployment as their jobs are 1.8x more vulnerable as they tend to work in sectors that are hardest hit by the economic downturn such as retail, restaurants etc. According to the UN Women, the pandemic risked turning back the clock on gender equality by 25 years.



But, if we collectively activate the power of women’s contribution in Africa, and encourage them to reach their potential, companies log increased performance, societies become more productive, and economies thrive. In fact, Africa could add $316 billion or 10% to GDP by 2025 if each country makes advances in women’s equality to match the country in the region that has achieved the most progress towards parity (McKinsey 2019).



Amidst recovery, we now have a chance to hit the reset button in all industries – across the board, and across boards. It is time to ask ourselves if we have the balance that Africa needs – and prepare to do what it takes to get there. It will require collective action from corporates, governments, NGOs and communities to make it happen. There is much work to do. Gender inequality in work and society loom large, and interventions are critical.



<h2 class="wp-block-heading" id="h-opportunities-to-advance-gender-equality">Opportunities to Advance Gender Equality</h2>



Unleashing potential and unblocking much needed growth can be actioned across three priority areas: youth, women entrepreneurs and women in the workplace.



<ul class="wp-block-list"><li>Youth – Africa is home to 19 of 20 of the world’s youngest populations which should present a tailwind of productivity opportunity. However, with youth (15 – 24 years old) unemployment as high as <a href="https://www.enca.com/business/youth-unemployment-desperate-challenge-expert">63.2%</a> in countries like South Africa there is an urgent need to align academic and technical skills with employment realities. Encouraging girls to participate in Science Technology, Engineering and Maths (STEM) subjects is key to develop critical 21st century skills girls need for their studies and career success. Bringing more female youth into technology fields and achieving gender parity will only make companies stronger and products more relevant to women as customers.</li></ul>



<ul class="wp-block-list"><li>Women entrepreneurs – According to the 2020 Mastercard Index of Women Entrepreneurs, Africa has the world’s top three countries when it comes to women entrepreneurs (as a percentage): Uganda (39.6%), Botswana (38.5%) and Ghana (36.5%). Despite some positive trends, the report also notes the disproportionate impact of the COVID-19 pandemic on women entrepreneurs around the world, with 87% saying they have been adversely affected. Overrepresentation in sectors hardest hit by the economic downturn, the pronounced digital gender gap in an increasingly virtual world, and the mounting pressures of childcare responsibilities are only a few factors that have left women particularly vulnerable. Despite the obvious challenges, the report highlights a number of opportunities for women in the COVID-19 era, particularly in online shopping and digital commerce. As a non-exec board member of Junior Achievement South Africa – a non-profit organisation that is playing its part in preparing the youth for the 21st century through entrepreneurial training and financial literacy programmes &nbsp;&#8211; I have seen how versatile and resilient women entrepreneurs can be in the face of adversity. Shortly after the pandemic started, I had the chance to mentor a woman who pivoted her fashion business to produce face masks and set up an online store. Ensuring access to technology or digital solutions, affordable data and modern trade resources as well as business training will empower more women to succeed in business.</li></ul>



<ul class="wp-block-list"><li>Women in the workplace &#8211; While Africa has above average board representation of women at 25% (McKinsey 2019) compared to the global average, it lags in executive committee positions and women coming into middle management positions. Gender equality in the workplace requires an adjustment by all of us if it is going to become a reality in the near term. At Mastercard, we have grown our female workforce across Africa by 370% over the last 5 years and across the Middle East and Africa, our team is 42% female. While there is still room for improvement, we have made meaningful interventions:</li><li>We closed the gender pay gap to ensure that women earn $1 for every $1 earned by men.</li><li>Recognising that women may take a professional step back if they have children, we introduced 16 weeks of paid parental leave for both men and women. Eighty percent of men from across the business take their paternity leave, helping us develop a sharing environment, redress the balance between maternity and paternity leave, while also ensuring that same-sex partners aren’t left behind.&nbsp;</li><li>We have a dedicated Mastercard Women’s Leadership Network – a global network with local chapters in South Africa and Kenya that are tasked with developing and advancing women into leadership roles supported with training and mentorship opportunities.</li><li>We have evolved the recruitment process, designing 50/50 gender slates for all roles. The best person will always get the job but the process has been redesigned for greater fairness and opportunity.</li></ul>



Companies must make gender equality a priority, commit to KPIs and measure there&nbsp;progress. Much acclaimed Jane Fraser shattered the glass ceiling a few weeks ago by becoming the first women to lead a major US bank as the new CEO of Citigroup &#8211; a ceiling that has already been shattered in Africa. This is a positive step, but we can agree there is much more to do beyond these first milestones.



As we position our businesses for recovery in a post-Covid-19 world, we should be doing so with a vision and goals for gender parity. We need to provide girls with access to education from an early age so that they can develop the skills needed to be the leaders of tomorrow. We need to provide better access to financial and digital tools, support women in starting and growing their businesses, and foster a workplace where all employees feel valued, respected, and empowered to reach their greatest potential. By doing so, we can create a more equitable and prosperous future for us all.

AAA_1696.1

Women are Essential to Africa’s Recovery Plan

<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="820" height="547" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/02/GettyImages-1230791248-820x547.jpg" alt="" class="wp-image-396369" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/02/GettyImages-1230791248-820x547.jpg 820w, https://cms.cnbcafrica.com/wp-content/uploads/2021/02/GettyImages-1230791248-300x200.jpg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/02/GettyImages-1230791248-768x512.jpg 768w, https://cms.cnbcafrica.com/wp-content/uploads/2021/02/GettyImages-1230791248.jpg 1024w" sizes="auto, (max-width: 820px) 100vw, 820px" /><figcaption>BRAZIL &#8211; 2021/01/25: In this photo illustration the Whatsapp, Telegram, Signal, Instagram, Facebook and Twitter app icons seen displayed on a smartphone. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images)</figcaption></figure>



By now most of us have heard about WhatsApp&#8217;s privacy conundrum which it quickly backtracked on <a href="http://[https://www.cnbcafrica.com/2021/01/18/whatsapp-delays-privacy-update-over-user-confusion-and-backlash-about-facebook-data-sharing/">https://www.cnbcafrica.com/2021/01/18/whatsapp-delays-privacy-update-over-user-confusion-and-backlash-about-facebook-data-sharing</a>/ after public backlash. 



We&#8217;ve also heard about how social media played a part in the U.S. Capitol&#8217;s storming on 6 January and how social media platforms banned Trump and other right-leaning voices; how Apple and Google banned the Twitter-alternative Parler from their app stores; and then how Amazon Web Services (AWS), who were hosting Parler, shut the whole thing down entirely.



Since then, things have continued to escalate, with Apple facing a lawsuit <a href="http://[https://mashable.com/article/apple-telegram-lawsuit/]">https://mashable.com/article/apple-telegram-lawsuit/</a> for not removing Telegram from its App Store because of calls to violence apparently taking place there too.



Free-speech arguments aside, there is a massive silver-lining in all of this. This year might, at last, be the year of social media&#8217;s reckoning. WhatsApp&#8217;s privacy miscalculation has led to what Telegram founder, Pavel Durov has called the &#8220;largest digital migration in human history <a href="http://[https://t.me/durovschat]">https://t.me/durovschat</a>.



Last year, Facebook threatened to shut down its services in the EU as a result of it enforcing its General Data Protection Regulation (GDPR) rules <a href="http://[https://www.socialmediatoday.com/news/facebook-threatens-to-leave-europe-due-to-proposed-new-data-sharing-regulat/585619/]">https://www.socialmediatoday.com/news/facebook-threatens-to-leave-europe-due-to-proposed-new-data-sharing-regulat/585619/</a>. Change is coming.



For years, social media has been protected in the U.S. under a law called &#8220;Section 230&#8221; which protects an “interactive computer service” from lawsuits if a user or client on its platform engages in illegal behaviour (with some exceptions). 



This is why, unlike publishers, Facebook and Twitter are not liable for what users put on their platforms. But the fact remains that these platforms are monetising what users are doing and controversial accounts keep people on the platform and are actually good for business. Plus, Twitter and Facebook&#8217;s enforcement of their own terms of service is very haphazard.



In 2018, Facebook was linked to genocide in Myanmar <a href="http://[https://www.nytimes.com/2018/10/15/technology/myanmar-facebook-genocide.html].">https://www.nytimes.com/2018/10/15/technology/myanmar-facebook-genocide.html</a>. There are many megalomaniac dictators tweeting as you read this. Both platforms were silent when the PR firm Bell Pottinger was using their algorithms to drive open our racial wounds in South Africa; or when xenophobic violence was incited on these platforms; or even when people died in the mid-2020 Black Lives Matter protests in the U.S. due to what was being organised on their platforms.



 (Incidentally, Twitter seems to be cracking down on Antifa accounts too now. <a href="http://[https://nypost.com/2021/01/22/twitter-suspends-antifa-accounts-with-over-71k-followers/]">https://nypost.com/2021/01/22/twitter-suspends-antifa-accounts-with-over-71k-followers/</a>). In fact, this sort-of practice hearkens all the way back to the first, heady days when we were all blown away by how #OccupyWallStreet went mainstream because of social media and how the Arab Spring was able to happen because of these platforms. 



Twitter may have been happy for all of this because it was not affecting them back home. Now, when it has, the penny seems to be dropping and the pressure seems to finally be on.



Perhaps you are partial to some of these movements, but the point is to note that these platforms increasingly have to act more like publishers than &#8220;Section 230&#8221; organisations. 



I think this is a good development. Their ability to get the best of both worlds—to not be held liable while increasing their profits through &#8216;gamification&#8217; and addiction to their platforms, monetising human nature&#8217;s worst aspects—is now going to run to an end. It&#8217;s time to classify them differently.



There is a bigger picture here that I think those who are claiming and advising people stay on Whatsapp appear to be missing. It&#8217;s time we demand innovation that doesn&#8217;t keep us reliant and addicted to these platforms but find better ways to serve us, even as Africans.



 It&#8217;s time to check out local services like 2go <a href="http://[https://www.2go.im/]">https://www.2go.im/</a>, for instance. It&#8217;s also a good time for us to form our own laws that we want applied that will benefit us, just as the EU has.



This is the big picture and right now, you and I, the &#8220;users&#8221; of these platforms have an opportunity to make an impact by getting off the platforms that make money from our time, our emotions, our relationships, our photos, our lives, and insist on better, more human technology.



Ryan Peter is the editor-in-chief of Disrupting Africa (disruptingafrica.com), a freelancer writer and ghostwriter. See more info at ryanpeterwrites.com.

In this photo illustration the Whatsapp, Telegram, Signal,

The Year of Social Media’s Reckoning

General elections will be held in Tanzania on Wednesday, October 28.



In the build-up to the vote, President John Magufuli’s administration has been intensifying its crackdown on the opposition as he seeks a second term in office.



Earlier this month, the National Electoral Committee (NEC) imposed a week-long ban on Mr Magufuli’s biggest challenger, the Democracy Party&#8217;s (Chadema) Tundu Lissu.



Just over a week later, the Zanzibar Electoral Commission (ZEC) also banned the Alliance for Change and Transparency’s (ACT-Wazalendo) presidential candidate for Zanzibar, Seif Sharif Hamad, from campaigning in the semi-autonomous region for five days.



Mr Hamad is the biggest challenger in the Zanzibar race to the ruling Revolutionary Party’s (CCM) candidate, Hussein Mwinyi.



Mr Magufuli received a great amount of praise when he came into office in 2015. He publicly fired officials who were considered to be corrupt or underperforming.



However, as his time in office progressed, he increasingly closed up on the democratic space in Tanzania.



The media nicknamed him ‘Bulldozer’, or ‘Tingatina’ in Swahili, initially because of his directives as the minister of public works, but the name has stuck due to his aggressive ways as president.



Over the years, his administration has made it essentially impossible to express dissent from the ruling regime without facing legal consequences.



When Mr Magufuli took office in 2015, Tanzania ranked 75th in the Reporters without Borders World Press Freedom Index. It is now 124th.



Opposition politicians and journalists who speak up are subject to arrests and intimidation by state security forces, which has resulted in self-censorship.



In August, the Tanzania Communications Regulatory Authority banned local media from broadcasting foreign content without state approval and made a law that requires foreign journalists to be accompanied by a government-appointed officer when covering local stories.



Mr Lissu, despite his high international profile, has been subject to serious intimidation by state security forces. In September, police teargassed his convoy.



Local media seems reluctant to cover his campaign, but the large, enthusiastic crowds are well documented on social media.



Censorship has also made it difficult to determine how strong the general support for Mr Lissu is.



The only opinion polls ahead of these elections show that the public favours Mr Magufuli, but this should not be viewed as the whole truth.



In 2018, civil society organisation Twaweza published an opinion poll showing that Mr Magufuli’s popularity had plummeted. The government subsequently banned Twaweza head Aiden Eyakuze from travelling outside Tanzania and made it mandatory for organisations to get state approval before publishing surveys.



Cooperation between the opposition parties may help them.



Chadema and ACT-Wazalendo initially entered what they called a ‘loose collaboration’, but on 16 October, the chairperson of the latter party, Zitto Kabwe, officially pledged his support for Mr Lissu in a statement.



After the Registrar of Political Parties informed them that it was too late to form a coalition, Mr Kabwe made it clear that the parties are merely endorsing each other’s presidential candidates.



Parliamentary and council candidates will still contest on their own parties’ tickets.



Mr Kabwe also wrote in an article published in South Africa’s Daily Maverick that “the best way to remove Magufuli &#8230; is for [the opposition] to unite behind Lissu”.



He has called upon other opposition parties to follow ACT-Wazalendo and “do what is best for Tanzania”.



ACT-Wazalendo’s presidential candidate for the Union presidency, Bernard Membe, has not campaigned since early September without any reason given, but, at a press conference on Monday, October 19, he reiterated that he was still in the running for the presidency.



He also warned religious leaders to avoid directing their followers to vote for a particular candidate, as it would trigger “religious violence that is not easy to resolve”.



Although the opposition parties are endorsing each other’s candidates, Mr Magufuli is likely to win a second term in office, even if it is by illegal means.



The 2015 elections in Zanzibar is an indication that the ruling party is willing to do whatever it takes to secure a victory, which will further contribute to the deterioration of democracy in Tanzania.



In his second term in office, we expect that Mr Magufuli’s administration will intensify its tight grip on civil society and continue on this path of authoritarianism.



If he is re-elected, Mr Magufuli has promised to continue strengthening the country’s economy, fighting corruption, and improving key infrastructure to facilitate business operations, such as the oil pipeline agreement recently signed with Uganda, but his authoritarian streak has resulted in some intimidation of foreign companies and has had a negative effect on investment.



We think such incidents will keep happening in his second term and will keep making potential investors cautious.



Zaynab Mohamed &#8211; Political Analyst

shutterstock_207995749

Tanzania – Will Magufuli bulldoze his way through the elections?

Open Letter to the President and Commander-in-Chief of the Armed Forces of the Federal Republic of Nigeria October 21, 2020 



President Buhari, You appealed to Nigerians to give you a mandate in 2003, 2007 and 2011. In 2015, you walked among the people. Nigerians, young and old, walked with you. On May 29, 2015 we swore you in. You pledged to serve Nigeria, to “celebrate her freedom and cherish her democracy”. You said to Nigerians that, “together we cooperate to surprise the world that had come to expect only the worst from Nigeria.” 



You, saluted Nigerians for waiting long hours in rain and hot sunshine to register and cast their votes and stayed all night if necessary, to protect and ensure their votes count and were counted. You thanked those who tirelessly carried the campaign on social media. President Buhari, this is an urgent call from those who gave you this mandate: tell the armed forces to stand down and stop shooting at or killing unarmed Nigerians. Undeniably, the lives of young Nigerians are being shed in hopes of a better Nigeria, which you chose to serve.



<figure class="wp-block-image size-large is-resized"><img loading="lazy" decoding="async" src="https://www.cnbcafrica.com/wp-content/uploads/2020/07/Muhammadu_Buhari_-_Chatham_House.jpg" alt="" class="wp-image-376011" width="694" height="756"/><figcaption>President Buhari</figcaption></figure>



In the last two weeks, Nigeria has seen an intergenerational call for a better country through better governance. It was led by the youth and it was peaceful. Given your experience running for office, where there is a crowd there are opportunists that seek to infiltrate and cause havoc. This was not the protesters, they remained peaceful. However, Mr. President, the democracy, which you choose to uphold, necessitates that the people speak. The rot in the system is undeniable. Nigerians at home and abroad were expressing their displeasure. That same groundswell that gave you a mandate was speaking to you, but our cries were met with a bloody flag. In spite of the denials, we are in a new age of social media, some of us were on ground while some watched on social media what transpired. The world watched alongside with us. Mr. President, the armed forces should never be said to harm or kill its own unarmed people. We appeal to your duty as the Commander-in-Chief, your decision to be the democratically elected President of Nigeria and your role as a Father: stay the bullets of the armed forces. As a democratic nation, Mr. President, we will continue to speak, we will continue to call out the rot in the Nigerian system, we have just one country. The same way you fought for it, we will fight for it. The Undersigned Archbishop Desmond Tutu Leadership Fellows of Nigeria: Abayomi Awobokun Ada Osakwe Adebola Williams Aderonke O. Onadeko Bibi Bakare-Yusuf Bosun Tijani Bowale Adeoye Danladi Verhijen Debisi Araba Emmanuel Ogejuma ‘Gbenga Sesan Ifeoma Malo Jude M.I. Abaga Mezuo Nwuneli Mosunmola Umoru Ogochukwu Ekezie Omoni Oboli Onyinye Ibeneche Avbovbo Sadiq Usman Samson Itodo Serah Zainab Ugbabe Temi Awogboro Tomiwa Aladekomo Toyosi Kolawole The Archbishop Desmond Tutu Leadership Fellows (“Tutu Fellows”), of the African Leadership Institute, are a diverse group of civic, political and business leaders from 40 African countries who are concerned with the governance and development of the African continent.

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Contributor

The Promise of Open Banking in Driving Financial Inclusion in Africa

Cryptoassets as National Currency? A Step Too Far

Africa’s smallholder farmers are the linchpin to economic success

The Future of Africa

Using what you have to get what you want: why Central African countries must put natural capital accounting at the centre of their development

Sisonke, Big business and small business need each other now more than ever

From the president’s desk: Government interventions yielding some positive results for economy

Reopening schools cannot wait

Are Tech Giants the 4th Tier of Government?

Sub-Saharan Africa: We need to act now.

Four Facts about Soaring Consumer Food Prices

Why the Build Back Better World Partnership Should Be Looking to Nigeria

After Eskom & SAA announcements, RMB CEO urges government to grasp nettle of further reforms

Women are Essential to Africa’s Recovery Plan

The Year of Social Media’s Reckoning

Tanzania – Will Magufuli bulldoze his way through the elections?

Opinion: Open Letter to President Buhari of Nigeria

News Tips

Advertise With Us

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