Duduzane Zuma, the son of South Africa’s President, said on Thursday there was “nothing untoward” about his links with the Gupta brothers &#8211; businessmen accused of using their friendship with his family to win contracts.
Duduzane told the BBC in a rare interview he had built up his own ties with the Gupta brothers purely through being “a likeable guy”.
“I’ve not involved myself in any corrupt practice, in any corrupt business,” he said.
The Guptas &#8211; a family of Indian-born businessman &#8211; have dismissed accusations by members of the ruling African National Congress party of using their link to the president to boost their businesses that span mining and technology and have government contracts.
President Jacob Zuma has faced calls to resign from the opposition and also within the usually united ANC over the relationship and the allegations of influence wielding that have shaken the government and markets. He has also denied any wrongdoing.
The main opposition Democratic Alliance (DA) party has said Duduzane helped produce a racially-charged PR campaign backing his father while he was working for Oakbay Resources, which was controlled by the Guptas.
The DA based its allegations on tens of thousands of leaked emails released by investigative journalists &#8211; though one of the Gupta brothers, Atul Gupta, said this month the emails were fake.
Duduzane said in April last year he would sell his investments in a mining firm owned by Oakbay Investments &#8211; a holding company for Gupta businesses in South Africa.
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Reporting by James Macharia; Editing by Andrew Heavens
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Zuma’s son: ‘Nothing untoward’ about links to South Africa’s Guptas

Kenya’s Supreme Court on Friday said the electoral board committed “irregularities and illegalities” during last month’s presidential vote, harming the integrity of the election that handed President Uhuru Kenyatta a second five-year term.
Four out of six judges said that the vote had been harmed by irregularities. Judges then allowed the two dissenting justices to read their opinions before giving their verdict on whether the irregularities were serious enough to nullify the election results.
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reporting by Maggie Fick; writing by Katharine Houreld; Editing by Hugh Lawson
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Kenyan presidential election nullified

Paul Leonard | Citadel
Tax season – the period during which you are required to submit your annual income tax return – started on 1 July and is now in full swing so I thought it would be interesting to look at how long we work for the taxman in South Africa, metaphorically speaking.
If we assume that you do not work on weekends or on public holidays then you have 250 work days for which you will be paid this year. For this illustration I have ignored your annual leave – you are paid for those days of leave anyway, so I just kept them in as part of the 250 work days you have.
The tax threshold is R75,750/year for people below age 65 this year, which is just above R6,300/month. This means that anyone earning R6,300 a month or less will pay no tax and they don’t spend any time working for the government.
If you earn R10,000 per month, or R120,000 this year, then you will pay R7,900 (the tax figures in this article have been rounded) in tax this year and 17 of your working days, in other words up until the 24th of January will have been spent working to pay tax to the government. Since then you have been working for yourself.
At an income of R25,000 per month or R300,000 this year you will spend 41 of your work days working to pay just short of R50,000 in tax.
If you earn R50,000 per month or R600,000 this year you will pay just over R153,000 in tax and it will have taken you 64 of your working days, in other words until Friday the 31st of March to pay your income tax.
If you earn a R100,000 per month then you will spend 83 of your 250 working days this year to pay just short of R400,000 (R396,990) in income tax and it will have taken you until Wednesday the 3rd of May this year to do so.
Just for interest sake, if you earn between R1,14 million and R4 million this year you will have completed your tax days sometime in May. People earning more than R4 million in taxable income this year will spend at least 103 of their 250 working days to pay income tax and will have finished working to pay their taxes in the first two weeks of last month. By the 14th of June everyone, including those with ultra-high incomes will have finished working to pay income tax.
You can reduce your number of tax working days by contributing to retirement funds
If, for example, if you earn R50,000/month you will have 64 tax working days, but if you put 15% of your taxable income into a retirement fund, like a retirement annuity, then you will reduce your tax days from 64 to 50 tax days. That is a reduction of 14 working days. Remember that does not include weekends, so it actually means a reduction of almost 3 weeks. To put it differently, in this example, contributing 15% to a retirement annuity amazingly reduces your tax work days by 22% because you have reduced your income tax by 22%.
You are currently able to contribute 27,5% of your taxable income towards a retirement annuity. Remember that this is limited to R350,000 for the year. If you earned R50,000/month and your retirement contribution was 27,5% then you would reduce your tax work days down to 39. So instead of working for the tax man until the 31st of March you would have finished working for the taxman by the 23rd of February this year.
This is a great example of where it is valuable to pay yourself first using retirement funds – as this case shows if you earn R50,000/month you could cut the amount of time you spend working for the taxman by a whole month.
Table 1: Tax work days and the saving generated by contributing to RAs
<table style="height: 974px;" width="799">
<tbody>
<tr>
<td colspan="2" rowspan="2" width="179">Taxable Income</td>
<td colspan="3" width="162">Tax work days*</td>
<td colspan="3" width="223">Tax Free Date§</td>
<td width="8"></td>
</tr>
<tr>
<td colspan="3" width="162">RA Contribution</td>
<td colspan="3" width="223">RA Contribution</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">pm</td>
<td width="95"> pa</td>
<td width="57">0%</td>
<td width="57">15%</td>
<td width="49">27.5%</td>
<td width="81">0%</td>
<td width="71">15%</td>
<td width="71">27.5%</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 10,000</td>
<td width="95"> R 120,000</td>
<td width="57">17</td>
<td width="57">10</td>
<td width="49">4</td>
<td width="81">24-Jan</td>
<td width="71">13-Jan</td>
<td width="71">6-Jan</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 20,000</td>
<td width="95"> R 240,000</td>
<td width="57">35</td>
<td width="57">25</td>
<td width="49">18</td>
<td width="81">17-Feb</td>
<td width="71">6-Feb</td>
<td width="71">26-Jan</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 30,000</td>
<td width="95"> R 360,000</td>
<td width="57">47</td>
<td width="57">36</td>
<td width="49">27</td>
<td width="81">8-Mar</td>
<td width="71">20-Feb</td>
<td width="71">8-Feb</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 40,000</td>
<td width="95"> R 480,000</td>
<td width="57">57</td>
<td width="57">43</td>
<td width="49">33</td>
<td width="81">22-Mar</td>
<td width="71">2-Mar</td>
<td width="71">16-Feb</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 50,000</td>
<td width="95"> R 600,000</td>
<td width="57">64</td>
<td width="57">50</td>
<td width="49">39</td>
<td width="81">31-Mar</td>
<td width="71">10-Mar</td>
<td width="71">23-Feb</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 60,000</td>
<td width="95"> R 720,000</td>
<td width="57">70</td>
<td width="57">55</td>
<td width="49">43</td>
<td width="81">10-Apr</td>
<td width="71">17-Mar</td>
<td width="71">1-Mar</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 80,000</td>
<td width="95"> R 960,000</td>
<td width="57">78</td>
<td width="57">62</td>
<td width="49">50</td>
<td width="81">24-Apr</td>
<td width="71">30-Mar</td>
<td width="71">10-Mar</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 100,000</td>
<td width="95"> R 1,200,000</td>
<td width="57">83</td>
<td width="57">67</td>
<td width="49">55</td>
<td width="81">3-May</td>
<td width="71">6-Apr</td>
<td width="71">17-Mar</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 150,000</td>
<td width="95"> R 1,800,000</td>
<td width="57">91</td>
<td width="57">74</td>
<td width="49">69**</td>
<td width="81">15-May</td>
<td width="71">19-Apr</td>
<td width="71">10-Apr**</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 200,000</td>
<td width="95"> R 2,400,000</td>
<td width="57">96</td>
<td width="57">80**</td>
<td width="49">80**</td>
<td width="81">23-May</td>
<td width="71">26-Apr**</td>
<td width="71">26-Apr**</td>
<td width="8"></td>
</tr>
<tr>
<td width="84">R 250,000</td>
<td width="95"> R 3,000,000</td>
<td width="57">100</td>
<td width="57">86**</td>
<td width="49">86**</td>
<td width="81">26-May</td>
<td width="71">9-May**</td>
<td width="71">9-May**</td>
<td width="8"></td>
</tr>
</tbody>
</table>
Notes:                                                                                                                   
2017/18 tax tables for a tax payer below age 65                                                  
* Work Days exclude weekends and public holidays (2017 calendar year)               
** Maximum contribution of R350,000 pa has been reached                        
§ Tax Free date is the last day on which tax is paid 

Source: Citadel

Paying the taxman

Patrick Bond |University of the Witwatersrand
At the BRICS summit in Russia two years ago, Chinese Premier Xi Jinping invoked physics when asking fellow leaders “to boost the centripetal (unifying) force of BRICS nations through cooperation in innovation and production capacity to boost competitiveness.”
That was the theory, but the economic reality of the once-feted Brazil-Russia-India-China-South Africa alliance is contradictory.
Instead of centripetal strengthening, the world is witnessing much more powerful centrifugal dividing forces, including overproduction, over-indebtedness and deglobalisation of capital. These elements have been spinning out of control even before the chaotic era of US President Donald Trump began.
Over production is mostly found in the coal, steel, non-ferrous metals, cement and chemicals industries. It’s largely driven from China where over-capacity is more than 30%, according to a new International Monetary Fund report that also raised worries about the country’s vast debt.
Over borrowing by companies, states and households represents a global crisis in the making. The Institute of International Finance has just reported that world debt is now USD$217 trillion (327% of world GDP), up from USD$149 billion (276%) in 2007.
Deglobalisation is simply the reversal &#8211; mostly since 2008 &#8211; of prior rapid growth in cross-border trade, investment and finance. Should that be viewed as a bad thing? Rather than fear globalisation’s unravelling, leading scholar-activists including Samir Amin in Africa, the late Ruy Mauro Marini in Latin America, Walden Bello in Asia and the 20th century’s most important economist, John Maynard Keynes, have all advocated national economic sovereignty. If pursued cleverly, deglobalisation could be the basis for restoring links between once vibrant sectors subsequently destroyed by imports.
Could BRICS leaders evolve in this direction? Their summit next week will be distracted by geopolitical tensions. Although a welcome deal on Monday prevents the feared Sino-Indian border war, a much more durable geo-economic battle is unfolding in the China-Pakistan Economic Corridor, which in May left Prime Minister Narendra Modi boycotting China’s Belt and Road mega-conference three months ago.
Beijing’s BRICS logo designers, perhaps being unconsciously subversive, have illustrated how the once overlapping, interlocking BRICS are now being wedged apart as paper thin subjects of centrifugal forces. For Africa, fewer illusions in these economies would be welcome, given how exploitative the BRICS and their firms have become against societies, democratic movements and environments.
<h2>A counter-summit challenges the BRICS</h2>
This argument is made by the Hong Kong People’s Forum, initiated by the city’s progressive labour, intellectual and faith leaders to question the BRICS. Their meeting this weekend follows in the counter summit traditions of the 2013 brics-from-below in Durban, the 2014 Dialogue on Development in Fortaleza, and the 2016 Goa People’s Forum on BRICS.
According to the Hong Kong People’s Forum:
<blockquote>Instead of offering an alternative, the BRICS actually offer a continuation of neo-liberalism. On top of BRICS there is also China’s new mega project, the Belt and Road initiative whose main purpose is to export China’s surplus capital.</blockquote>
These surpluses are vast, as witnessed in China’s foreign reserves which recently topped USD$4 trillion, though then fell 20% due to bouts of capital flight and two stock market crashes in 2015-16.
<h2>Deglobalisation</h2>
Global trade, finance and investment were meant to be the motors for the advancement of BRICS. But according to the World Bank, global trade peaked at 61% of world gross domestic product (GDP) in 2008 but retreated to 58% in 2015.
During the 1990s each BRICS country raised its trade to GDP ratio by at least 10 points. But trade has receded in importance in each of the BRICS. Russia peaked first at a 69% trade/GDP ratio in 1999, and then fell steadily to 45% today. Brazil rose to 30% in 2004 and fell to 25%. China soared to 66% in 2006 and has since plummeted to 36%. South Africa’s 2008 ratio was 73% but is now back to 60% and India peaked last, in 2012 with 56%, and is now at 40%.
On top of this, the ratio of world financial assets that are held overseas compared to GDP fell from 58% in 2008 to 38% in 2016, even as overall financial assets increased in line with soaring debt.
Finally, another deglobalisation symptom is the halving of relative global foreign direct investment: from 3.7% of world GDP in 2008 to 1.7% in 2016.
Leading financiers now talk of an imminent world recession, given over priced stock markets and corporate debt. This is not just due to wild New York share speculation, as also occurred before the crashes of 1987, 2000 and 2008. Three BRICS stock markets are also bubbling: South Africa’s stock market is 90% higher than in 2010, India’s market is up 70% and Russia has risen by 50%.
<h2>Centrifugal realities crowd out centripetal fantasies</h2>
These dangerous centrifugal forces cannot be easily regulated or reversed. The only recent relief came from the Chinese state’s massive urban construction investments (albeit leaving scores of near-empty cities) and the Indian service sector boom. But since 2015 the other three BRICS have suffered recessions as the crash in commodity prices hit home.
As the Hong Kong People’s Forum statement explained:
<blockquote>China has now evolved into a global engine promoting a neo-liberal agenda from free trade agreements to corporate led integration across borders.</blockquote>
The BRICS had promised to challenge an unfair global economic system. But in December 2015 their main multilateral reform strategies failed:
<ul>
<li>the Paris Climate Accord was non-binding, unambitious and outlaws climate-debt lawsuits by victims of Western and BRICS emissions;</li>
<li>the World Trade Organisation phased out any semblance of food sovereignty; and</li>
<li>IMF voting shares were shifted to favour BRICS at the expense of poorer countries.</li>
</ul>
Adds the Hong Kong People’s Forum: “The 2017 World Economic Forum in Davos was one site where Xi clearly took the lead in promoting world corporate power, as Trump leads the US-UK retreat into crony-capitalist protectionism.”
South African President Jacob Zuma pronounced last month at his party’s policy congress, “The ANC is part of the global anti-imperialist movement. We are historically connected with the countries of the South and therefore South-South cooperation such as BRICS is primary for our movement.”
If centrifugal economic forces now pressuring the bloc overwhelm Xi’s desired centripetal capitalism, then we can expect yet more talk-left walk-right politics, as the BRICS sub-imperialists desperately try to pretend they’re anti-imperialists.
&nbsp;
This article was first published in The Conversation.

BRICS is being battered by global crises: why this might not be a bad thing

The bodies of the last two miners unaccounted for at a mine operated by South Africa’s Harmony Gold were recovered on Thursday, the company said, bringing the death toll to five after a tremor shook the shafts last week.
Friday’s seismic event that rocked the Kusasalethu mine, one of the world’s deepest, with gold extracted at depths below 3 kilometers (1.8 miles), highlights the dangers of mining in South Africa’s challenging geology.
“All of the employees who were trapped underground, are now accounted for,” the company said in a statement.
South Africa is home to the world’s deepest mines where workers operate at depths of up to 4 kilometers. The industry has made efforts to improve safety and the number of miners killed hit a record low of 73 registered last year, compared with 77 in 2015.
Kusasalethu, located 90 kilometers west of Johannesburg, has had a troubled history and been a flash point for labor violence and strikes in recent years, threatening its viability and underlining the social risks of mining in South Africa.
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Reporting by Ed Stoddard; Editing by Susan Fenton
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Bodies of last missing miners recovered from Harmony mine in South Africa

Tanzania has invited bids to build a 2,100-megawatt (MW) hydroelectric plant in a World Heritage site renowned for its animal populations, despite opposition from conservationists to the long-delayed project.
The East African nation considers the project at Stiegler’s Gorge in the UNESCO-designated Selous Game Reserve as vital in its bid to diversify its energy mix and end chronic electricity shortages. The project would more than double the country’s power generation capacity.
The Energy and Minerals Ministry said it expected construction of the power plant to be completed within three years, according to a document published on its website late on Wednesday.
The deadline for bids is Oct. 16, according to the document, which specifies that work must be completed within a period of 36 months, with a maximum mobilization period of three months.
The government did not say how much the project would cost and how it would raise financing.
President John Magufuli’s office said last month the long-delayed hydroelectric plant would be built “to speed up the development of the country”.
Experts from Ethiopia, which is also building new hydro-electric dams, would advise the government, Magufuli’s office said.
Critics say construction of a dam in a major river that runs through the Selous Game Reserve could affect wildlife and their habitats downstream.
Covering 50,000 sq km, the reserve is one of the largest protected areas in Africa, according to UNESCO. It is known for its elephants, black rhinoceroses and giraffes, among many other species.
The WWF conservation group said in a report in July the proposed large-scale hydropower dam “puts protected areas of global importance, as well as the livelihoods of over 200,000 people who depend upon the environment, at risk.”
“The impact on Tanzania’s largest river would affect many ecosystem services it provides. It would affect tourism in Selous downstream in some of the most abundant wildlife areas in the game reserve,” it said.
The government has also been criticized by environmental groups for granting Australia-based miner Mantra Resources rights to build a $400 million uranium mine in the sanctuary.
Tanzania said in February it needed $46.2 billion in investment over the next 20 years to revamp aging energy infrastructure and to meet soaring demand for electricity.
Investors have long complained that a lack of reliable power is an obstacle to doing business in East Africa’s second biggest economy.
Tanzania aims to boost power generation capacity to 10,000 MW on the next decade from about 1,500 MW now by using hydropower and some of its vast natural gas and coal reserves.
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Editing by Maggie Fick and Edmund Blair
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Tanzania invites bids for hydropower project in game reserve

Judith Verweijen | Ghent University
The past year has been challenging for the Canadian mining corporation Banro. The company holds four gold mining concessions in the eastern Democratic Republic of Congo (DRC). The Namoya concession in Maniema province went into production in January 2016 but the company was forced to temporarily suspend operations and evacuate staff in May and July this year.
The suspensions were related to threats from a local armed group to attack the operation. These were not isolated incidents but followed a string of violent attacks, property destruction, ambushes and kidnappings of workers.
The company president and CEO, John Clarke blamed the violence on “a few bandits” he believes are a remnant of the country’s difficult past, not on discontent and poverty that many believe have been made worse by the company’s presence.
But my recently published research shows that these issues are in fact interrelated. Armed groups and local strongmen capitalise on widespread anger towards the company. This anger largely stems from the deep economic crisis in the Namoya region which was caused by the forced closure of artisanal mining sites four years ago. The effects were not only felt by the 6.000 to 10.000 diggers who were forcibly removed, but also by all those depending indirectly on diggers’ incomes, like farmers, shopkeepers, bar-owners and taxing agents.
By claiming to oppose transnational mining companies, armed groups are able to gain popular support. They often do so by drawing on the language of anti-imperialism and neocolonialism, which resonates strongly in the DRC. As a political representative of the coalition of armed groups responsible for the most recent attacks put it:
<blockquote>the government has signed contracts with foreign mining companies that allow them to plunder our resources. This is neocolonialism (…) we will fight it.</blockquote>
Armed groups are also bolstered by competition between local elites and authorities that is fuelled by the influx of resources stemming from mining operations. In a militarised area like the eastern DRC, conflicting local elites and authorities often draw on armed groups to bolster their position. This, in turn, strengthens these groups.
Mining companies would be better served to acknowledge and monitor rather than downplay the effects of their presence on conflicts and armed groups. Arguably, a more conflict-sensitive approach could have prevented the outbreak of violence in Namoya.
<h2>How violence escalated</h2>
Before 2016 there was limited activity by armed groups in the Namoya region. This changed after an escalation of tensions between the company and the people living in the area in January 2016. That month, a protest march against Banro ended in bloodshed. An officer from the Congolese police unit contracted by Banro opened fire on the crowd of protesters, causing the death of one person.
The march was held to protest against what people perceive to be the company’s failure to promptly meet its commitments towards the community, like building health care centres and schools. The impatience is understandable given the dire economic situation in the region. Not only have artisanal miners largely been driven out of business, the company employs limited labour and subcontractors from the area.
Towards the end of 2016, armed groups began ambushing vehicles from Banro’s logistics subcontractors close to Namoya. In March this year, one of these groups also directly attacked Banro’s facilities, taking a number of employees hostage.
The group responsible for taking the employees hostage demanded that the company construct basic infrastructure in the area as one of the conditions for releasing the hostages. Namoya’s population has remained divided about the attacks, but many sympathise with the armed group’s stance. This has allowed the group to harness crucial support from community members, like financial contributions and intelligence.
<h2>Neither criminal nor ideological</h2>
There is a tendency to see armed groups in dichotomous terms: as either ideological and having a political agenda or as criminal and pursuing material self interest. The reality is much more complex.
There’s no doubt that there’s a good dose of self interest in armed groups’ antagonism towards Banro. They have tried to benefit financially from ransom payments and “protection fees” paid by logistics subcontractors to avoid ambushes. Many armed groups also depend on artisanal mining for some of their income, imposing forced contributions on diggers and pit-owners. So the closure of artisanal mining sites by industrial companies threatens their income.
But this doesn’t mean they are simply criminals looking only for self-enrichment. Armed groups articulate widespread grievances, including growing discontent with the DRC’s political leadership and the delay in holding elections.
These grievances don’t legitimise the use of violence. But they create a measure of sympathy among the population for those claiming to fight the perceived source of their hardships.
There is a general fear that the expansion of industrial mining in the eastern DRC will eventually wipe out the artisanal and small-scale mining sector. This sector, which also mines tin, tantalum and tungsten, is estimated to employ 9-17% of the total population of the Kivu provinces. Its economic importance is however much bigger as money earned with mining is invested in other sectors, like real estate and the trade in consumer goods.
After the mining sites in Namoya were closed, many artisanal miners moved to gold mines in Fizi territory. But an exploration company, CASA Mining, is paving the way for industrial mining in that region and artisanal miners fear being displaced again.
An armed group active in the area plays into these fears. It has encouraged the population to manifest against the company. CASA’s operations have also been attacked. One member of the armed group commented that:
<blockquote>CASA will never work here. All those chased from Salamabila [Namoya] have fled here; they will rather revolt than being chased again.</blockquote>
Industrial mining companies operating in the eastern DRC would do well to acknowledge how their presence feeds into dynamics of conflict and violence rather than obscuring these complexities. As Banro’s plummeting share price over the past year shows, in particular a spectacular 12% drop after the violence in July, this would also be in the company’s own interest.
&nbsp;
This article was first published in The Conversation.

Op-Ed: Shedding light on why mining companies in eastern Congo are under attack

STELLENBOSCH, South Africa (Reuters) &#8211; A budget bank is booming in South Africa’s economic slump, challenging the decades-long dominance of the “big four” lenders and prompting a price war that is driving down banking costs in a country where many people can’t afford an account.
Capitec Bank has doubled its customer numbers over the past five years and quadrupled in market value, even as South Africa’s economic growth has stalled and the country has slid into recession, squeezing household incomes.
It offers a single “no-frills” bank account with low fees, as well as unsecured loans to customers including low-income borrowers, but steers clear of the more complex financial products offered by rivals.
This model has insulated it from the downturn, which has constrained mortgage lending and vehicle finance, key business areas for the four biggest banks: Standard Bank, FirstRand, Barclays Africa and Nedbank.
Those four heavyweights have reigned unchallenged over South Africa’s financial sector since the 1990s.
But Capitec, whose shares have risen more than 300 percent since 2012 and over 30 percent this year, now has a market value of 103 billion rand ($7.9 billion) &#8211; closing in on the number four lender Nedbank, which is worth 110 billion rand.
The Stellenbosch-based bank, which launched in 2001, has 9 million customers, of which 4 million are so-called primary clients who have their salaries deposited into these accounts.
“Most of them we’ve taken from other banks,” Capitec Chief Executive Gerrie Fourie told Reuters in an interview, saying that his bank attracts 100,000 to 150,000 new customers a month.
“The economy is helping us,” he added. “People have started questioning why they have to pay banking costs.”
There are clear risks to the bank’s business model of offering unsecured loans to lower-income borrowers without any other forms of lending to counter any losses, according to industry experts.
Capitec’s rise is nonetheless forcing its rivals to respond. They are all fighting back with their own no frills accounts aimed at hard-pressed consumers.
This is pushing down the cost of banking in South Africa &#8211; a significant development in a country where only around half of the 55 million population have bank accounts, according to Nielsen research, partly because of the charges involved.
<h3 data-reactid="52">BIG FOUR FIGHTING BACK</h3>
Bank fees for deposits, withdrawals, transfers and administration have for years largely ranged between 100 and 250 rand a month, but can rise as high as 450 &#8211; a stiff ask in a country where the minimum wage is 20 rand an hour.
Nedbank has reduced the administration fees for its most basic account to Capitec’s level of 5.50 rand a month and also lowered transaction costs. It now offers bank accounts that are about half the price of five years ago.
Chief Executive Mike Brown told Reuters it was focusing strongly on entry-level banking and was looking to that segment for customer growth.
The other big banks have gone even further, more than halving their fees for their most basic accounts over the past five years to undercut Capitec.
FirstRand’s FNB arm now offers an account with a monthly fee of 5.25, Standard Bank runs one for 4.99 rand per month, while Barclays Africa’s Absa division offers 4.95 rand.
Standard Bank’s co-Chief Executive Ben Kruger told Reuters it needed to be able to respond nimbly to counter lean new entrants like Capitec who have been able to enter the market without the stifling processes established banks have inherited from their paper-based legacy systems.
“Capitec is gaining market share in the bottom end and the middle of the market and they are increasingly becoming more aggressive in business banking,” said the bank’s other Co-CEO, Sim Tshabalala.
FirstRand, the largest banking group with a market value of 318 billion rand, has 7.7 million customers through its FNB arm; Standard Bank, valued at 276 billion rand, has 12 million; Barclays Africa, which is worth 128 billion rand, has 9.4 million through Absa; and Nedbank has 5.7 million.
<h3 data-reactid="61">RISKS TO CAPITEC MODEL</h3>
Nestled in the vineyards of the Western Cape, far from South Africa’s financial hub of Johannesburg, Capitec has enjoyed a rapid rise since it launched 16 years ago. The biggest growth came during the economic downturn of the past five years, both in terms of customers and market value.
“Capitec came from zero, to being a big player,” said Feroz Basa, head of Old Mutual’s Global Emerging Markets Fund. “It’s centred around this low-cost model, that’s how they are gaining market share.”
The retail bank has also been swiftly expanding its branch network, adding 76 last year to reach more than 800, compared with Absa’s 719, Standard’s 630, FNB’s 645 and Nedbank’s 513.
The bank’s growing deposit base has narrowed its own cost of funding significantly, Arqaam Capital analysts Jaap Meijer and Leen Antonios said in a note, adding that they expect it to generate higher-than-expected revenues in the next few years.
However, in terms of risks, the amount of Capitec’s loans in arrears at the end of December were up 24 percent to compared with a year earlier, at 2.86 billion rand, outstripping the 11 percent growth rate of its interest income.
Unlike its rivals, the bank offers only unsecured loans and cannot count on other lending areas such as mortgages to counter any losses. The company is due to report half-year results at the end of September.
“The other banks might have a bit of a moat by having vehicle finance, housing loans and bonds and higher value loans,” said Momentum SP Reid banking analyst Brian Mugabe. “Their (Capitec’s) biggest challenge comes as they move up the value chain.”
Nonetheless, as the price war for low-income customers gears up, Capitec warned its bigger competitors that it plans to climb the income ladder &#8211; but not all the way up.
“We designed this bank to service 90 to 95 percent of South Africa’s banking public,” said Fourie. “The wealthiest 5 to 10 percent of the population we leave for the guys offering private banking services.”
($1 = 13.2158 rand)
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Additional reporting by Tiisetso Motsoeneng; Editing by Pravin Char
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Capitec: The budget bank rattling South Africa’s financial sector

George Ogola | University of Central Lancashire
The recent Kenyan elections firmly demonstrated the incursion and perhaps even gradual institutionalisation of fake news as an actor in modern politics, particularly during elections. Although the term fake news is now so liberally used to the extent it eludes precise definition, many agree it’s the deliberate dissemination of false informationexpressly intended to misinform.
The presidential election, which pitted the incumbent Uhuru Kenyatta against his political nemesis, opposition leader Raila Odinga, was fiercely fought on many fronts. One of these fronts, arguably the most significant, was the unprecedented investment in political messaging.
Kenyatta’s Jubilee Party and Odinga’s National Super Alliance (NASA) invested heavily in media and public relations consultants, communication experts and political advertising. The Jubilee Party even enlisted the services of  Cambridge Analytica, the data mining and analysis company credited with playing an influential role in the election of US President Donald Trump. The company also had a hand in the UK’s Brexit campaign.
Added to this heady mix was clandestine messaging through fake newson social media sites such as Twitter, Facebook, Instagram and WhatsApp. Numerous fake news stories were widely circulated on social media as unsubstantiated allegations were posted against both parties, some even through paid adverts on Google.
This was a step up from previous elections where politicians would pay backstreet newspaper publishers to tarnish the names of their opponents. Kenya has always had publishers for hire, a particularly thriving industry at election time. These publishers quite often have no known addresses, are defined by their impermanence and therefore impossible to sue even when one is legitimately aggrieved by their publications.
In 2017 the mudslinging migrated online and become much more nuanced and sophisticated. Stories that featured fake opinion polls and others that directly attacked the characters of both Kenyatta and Odinga were widely circulated online and in print. Some of these were slickly produced videos that were passed off as originating from CNN and the BBC.
In one fake CNN video Kenyatta’s popularity rating was shown to be well ahead of Odinga’s. Another fake video, this time purportedly an outtake from the BBC’s Focus on Africa  programme, also featured an opinion poll showing Kenyatta beating Odinga.
And fake newspapers bearing the plagiarised mastheads of widely circulating dailies including the Daily Nation and The Star were sold to unsuspecting readers.
This proliferation of fake news in Kenya can be explained on two grounds. The first relates to the history of the country’s media, and the second to the increasing importance of online platforms in shaping the African news agenda.
<h2>The Kenyan media</h2>
The Kenyan media has become a prisoner of its history. It remains shackled to the consequences of its role in the country’s 2007 disputed presidential elections. A section of the press were accused of actively promoting the violence that engulfed the country in the aftermath of the polls. At least 1,000 people died and more than 500,000 thousand were displaced.
This legacy has turned the media into a bystander in the political process, especially at election time. In 2013 it hardly raised any objections to electoral malpractices that led to the disputed presidential election. Instead, media houses promoted “peace” to preempt a repeat of the 2007-2008 post-election violence.
It was a decision that was supported financially by a number of local and international agencies who spent months training the local press in “peace journalism”. This peace narrative has now became normalised in election coverage in the country. The consequence has been the creation of an information vacuum which has now been filled by fake news.
<h2>Rise of social media</h2>
The circulation of fake news also seems to have benefited from the changing profile of the Kenyan voter. Nearly half of about 20 million registered voters in Kenya are aged between 18 and 35. A significant number source their news from social media where fake news circulates the most.
According to a recent consumer survey only 28% of young Kenyans read newspapers regularly. Social media is slowly but surely becoming their platform of choice for news.
And the audience for fake news is growing given that two out of three young Kenyans now either own a mobile device or have access to one, and Internet connectivity costs go down annually.
This election revealed the fact that fake news has not only become commonplace, it’s become mainstream and is evolving into a distinct news genre.
Fake news thrives on the modern news consumer’s insatiable appetite for speedy information. We are living in a news ecosystem where urgency trumps the core values of journalism such as accuracy, fact checking and objectivity.
Traditional news media, with brands built on the back of their ability to fact check or investigate stories before publication, are struggling to do so when they are simultaneously expected to publish with speed. While gate keeping is key to ensure that news outlets remain trustworthy, the speed at which audiences now expect information has seen media houses haemorrhage audiences.
That lag in providing speedy information has created a vacuum which fake news producers are exploiting. They don’t have brands or reputations to protect. Fake news is positively sustained by an online economy which prioritises sensationalism over quality. Sensational ‘news’ very quickly goes viral and this is its most effective weapon.
Fake news is slowly intruding on virtually every aspect of life. We must first understand its appeal and then make every effort to counter it. This is especially the case because it is now a genre sustained by a much larger social, economic and political infrastructure that the news media alone is incapable of dealing with.
&nbsp;
This article was first published on The Conversation.

How social media and fake news are battering traditional media in Kenya

ABUJA (Reuters) &#8211; Nigeria’s President Muhammadu Buhari on Wednesday chaired his first cabinet meeting since returning from sick leave in Britain this month.
Buhari returned to Nigeria on Aug. 19 after more than three months in London for treatment for an undisclosed ailment.
He has kept a low profile and last week canceled a cabinet meeting, raising concerns that the president, criticized for inertia by his opponents, was returning to his former ways, when he worked from home and missed weekly cabinet meetings.
The refusal to disclose details of Buhari’s illness has caused speculation about whether the 74-year-old is well enough to run Africa’s most populous country and biggest economy.
He had reduced his working day to a few hours after returning to Nigeria from his first stint of medical leave in Britain on March 10, diplomats and government sources said at the time.
Since his return this month, Buhari’s office has been releasing a flurry of photos and statements from the president’s engagements, like meetings with his vice president, heads of the military and economic ministers and the central bank.
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Reporting by Felix Onuah; Writing by Paul Carsten; Editing by Janet Lawrence
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Nigerian president chairs first cabinet meeting since return from medical leave

KIGALI (Reuters) &#8211; Rwandan police said on Wednesday they were investigating Diane Shima Rwigara &#8211; a critic of President Paul Kagame barred from challenging him in elections this month &#8211; for tax evasion and forgery.
Officers searched Rwigara’s family home in the capital Kigali, police spokesperson Theos Badege said, dismissing reports spreading online that she had been arrested.
Rwigara, a 35-year-old accountant, has repeatedly accused Kagame of stiffling dissent and criticized his Rwandan Patriotic Front’s near total hold on power.
Electoral authorities barred her from standing in August’s presidential vote, saying she had not submitted enough supporters’ signatures and some of the names she did send in belonged to dead people &#8211; allegations she denied.
The U.S. State Department and the European Union criticized the decision to disqualify her from the vote, which Kagame went on to win by 98.8 percent.
Police said on Wednesday they had searched Rwigara’s house after receiving documents from the electoral commission, without going into further details.
The phones of Rwigara and three family members were switched off on Wednesday when Reuters called them. No one answered when a Reuters reporter rang the door bell at the home.
The police spokesman said the allegations of tax evasion were being jointly investigated with the Rwanda Revenue Authority.
The authority’s Commissioner General, Richard Tusabe, said the Rwigara family’s tobacco company had not paid taxes “over a period of five years.” No one in the family was immediately available to comment.
Kagame has won international praise for presiding over a peaceful and rapid economic recovery in Rwanda since the 1994 genocide, when an estimated 800,000 people Tutsis and moderate Hutus were killed.
But he has also faced mounting criticism for what human rights groups say are widespread abuses, a muzzling of independent media, and suppression of political opposition.
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Writing by Maggie Fick; Editing by Andrew Heavens
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Critic of Rwandan president investigated for forgery

CAPE TOWN (Reuters) &#8211; South Africa’s government is considering merging its three state-owned airlines into one entity, and offering a 25 percent stake of the holding company to a private equity partner, a cabinet minister said on Wednesday.
The loss-making South African Airways, its low-cost arm Mango and SAA Express, which services smaller towns, are struggling to remain profitable amid increased competition and rising operational costs.
“I believe the answer to all of it lies in how we rationalize the three companies and how we bring in a 25 percent shareholder to help us with both management as well as on finances,” Public Enterprises Minister Lynne Brown told a parliamentary committee.
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Reporting by Wendell Roelf; Editing by James Macharia
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SAA_Wikimedia

South Africa mulls merger of three state-owned airlines

HARARE (Reuters) &#8211; China’s R&amp;F plans to invest up to $2 billion to revive operations at Zimbabwe Iron and Steel Company (ZISCO), the southern African nation’s industry and commerce minister said on Tuesday.
Saddled by high debt and gross mismanagement, ZISCO ceased production in 2008 at the height of Zimbabwe’s economic meltdown.
Industry and Commerce Minister Mike Bimha said that teams from R&amp;F had been travelling to Zimbabwe in the past six months to perform due diligence and negotiate the deal.
He did not provide further details on the deal, but said that between $1 billion and $2 billion would be required to restart the steelmaker’s operations.
“We have already agreed with them on the framework of their operation &#8230; But there is a lot of work to be done,” Bimha said late on Monday.
“We believe that in the next 18 months we will be able to see the production of a million tonnes of steel (a year)”.
Essar Africa Holdings, a unit of India’s Essar Group, had agreed to invest in ZISCO in 2011 but the deal collapsed in 2015.
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Reporting by Kuda Chideme; Editing by David Goodman
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China’s R&F to invest up to $2BN to revive Zimbabwe steelmaker ZISCO

Faith Kiboro | SMC University
After Kenya’s contested election result, opposition leader Raila Odinga announced he wouldn’t be seeking legal redress for what he termed “a sham of an election”. Three days later he’d changed his mind and said he would be contesting the election in the country’s Supreme Court.
This means that Uhuru Kenyatta’s victory is on hold pending a decision by Kenya’s highest court. Its decision is expected in early September. The Supreme Court bench will be constituted by seven justices. These are the Chief Justice David Maraga, his Deputy Lady Justice Philomena Mwilu, Lady Justice Njoki Ndung&#8217;u, and justices Smokin Wanjala, Mohamed Khadhar Ibrahim, Jackton Boma Ojwang and Isaac Lenaola.
The petition is effectively an audit of the electoral process. This is a good thing. To build resilience against election-related disputes, Kenyans must stay open to legal arbitration as a way of vetting the democratic process, and standing up for stronger democratic values.
<h2>Odinga’s case</h2>
The main grounds of Odinga’s petition are that some of the presidential results were derived from nonexistent polling stations by ungazetted presiding and returning officers.
Odinga is also claiming that the results that declared Kenyatta the winner were not submitted procedurally. This claim has been a source of controversy and is likely to form a large part of the petition.
Odinga is also likely to argue that the election commission chairperson acted contrary to the law because he didn’t have all the requisite tallying documents when he declared the result.
He will have to prove that:
<ul>
<li>Some of the requisite tallying documents were not presented and verified at the national tallying centre before the results were declared. He would then have to prove that the failure to present and verify the documents significantly altered the outcome.</li>
<li>The tallying documents did not present a truthful account of the vote – in other words that some were fabricated or falsified. If he can prove this then the integrity of the election will be called into question.</li>
</ul>
<h2>Possible outcomes</h2>
If the court finds that the presidential election was invalid a fresh electionwill have to be called. This would involve the presidential candidates who participated on August 8. If any abandon the electoral contest or die before the scheduled date a fresh nomination exercise would have to be held.
After Odinga’s 2013 presidential petition, the Supreme Court ordered a partial recount of votes before upholding Kenyatta’s win.
But this time around the court is likely to ask for closer scrutiny of the entire poll process.
Odinga has filed a 25,000-page petition, compared to the 800-page document he filed in 2013. This places a huge responsibility on the court to sift through all the allegations.
A number of potential factors could affect its decision.
Firstly , the Supreme Court is likely to be swayed by the opinions of 400 election observers who deemed the election credible.
Secondly, the current chief justice is known to be a moderate. His conservatism may mean that he will uphold the electoral commission’s position and maintain that the election was carried out in a free, fair and transparent manner.
Invalidating the general election would be unprecedented in Kenya. But it could happen because the chief justice is keen to demonstrate judicial independence. The judiciary has recently come under attack from political leaders for deciding in favour of the opposition in its determination of a series of high profile pre-election cases.
<h2>Letter versus spirit of the law</h2>
Ultimately, the judges could go one of two ways.
They could make a decision based purely on the letter of the law. Or they could opt for a judgement that adheres to the spirit of the law – in other words the intention of the law as opposed to its literal meaning.
A judgement based on the spirit of the law is likely to serve the greater good – that is a return to normalcy as quickly as possible.
In the 2013 presidential election, the Supreme Court set a standard of proof which it phrased in a question.
<blockquote>Did the petitioner clearly and decisively show the conduct of the election to have been so devoid of merits, and so distorted, as not to reflect the expression of the people’s electoral intent?</blockquote>
There’s no doubt it will ask the same question this time round.
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This article was first published in The Conversation.

Op-Ed: Kenya’s election: Supreme Court judges hold the key to the outcome

Phumlani M. Majozi | Free Market Foundation
The state of South Africa’s basic education is a topic of constant debate – by political parties, the media, civil organisations and the general public. Even though basic education has had a positive impact on South Africa’s development post-apartheid, problems such as dismal educational outcomes and the absence of teachers torment us, and, especially, low-income families.
These problems aside, some progress has been made in addressing and eradicating the legacy of apartheid in education. Increased access to <a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.polity.org.za%2Ftopic%2Feducation-company&amp;i=1&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">education</a> has accelerated the growth of the black middle class so that, f<a href="http://dmanalytics2.com/click?u=https%3A%2F%2Fbusinesstech.co.za%2Fnews%2Fbusiness%2F134749%2Fblack-vs-white-middle-class-in-south-africa%2F&amp;i=2&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">or the first time, in 2008, the size of the black middle class surpassed that of whites</a>.
Throughout human history, <a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.polity.org.za%2Ftopic%2Feducation-company&amp;i=3&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">education</a> has been a big factor in the development of nations, and, therefore, <a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.polity.org.za%2Ftopic%2Fsouth-africa&amp;i=4&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">South Africa</a>’s prosperity is dependent on the quality of its basic <a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.polity.org.za%2Ftopic%2Feducation-company&amp;i=5&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">education</a>.
Even though South Africa’s education faces many challenges, it is fair to say that, on balance, the opening up of educational opportunities has had a positive impact on our society.
South Africa’s basic education challenges
Even with the progress that has been made since 1994, relative to the past, South Africa’s basic education is not doing as well as in other countries. Government is failing in many respects to pursue the reforms needed to improve the country’s education.
Besides the absence of teachers and dismal outcomes, other problems that challenge the provision of education in South Africa range from the shortage of educational facilities, to overcrowded classrooms, and the destructive actions embarked upon by <a href="http://dmanalytics2.com/click?u=https%3A%2F%2Fwww.dailymaverick.co.za%2Farticle%2F2017-05-11-sadtu-sas-most-controversial-union-faces-human-rights-probe%2F&amp;i=6&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">teacher unions like SADTU</a> (South African Democratic Teachers Union).
Most affected by government’s failure to improve public basic education are children from low-income families – where parents cannot afford to seek out alternative sources of education for their children.
<img loading="lazy" decoding="async" class="aligncenter wp-image-282460 size-full" src="http://cnbc.africa/wp-content/uploads/2017/08/FMF_State-of-Education_SA.png" alt="" width="656" height="378" />
Twenty per cent of South Africa’s government expenditure–the biggest allocation compared to other sectors, as shown on the 2016 Budget Review above – goes to education. Yet the outcomes still disappoint.
<a href="http://dmanalytics2.com/click?u=https%3A%2F%2Fafricacheck.org%2Freports%2Fis-sas-education-system-the-worst-in-africa-not-according-to-the-data%2F&amp;i=7&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=stuart%40biznews.com&amp;a=TqYqUQmIT3CLh53Pmnazig">According to Africa Check</a>, South Africa ranks behind poorer African countries like Kenya, Swaziland, Tanzania and Zimbabwe on literacy and numeracy. That we are behind these poorer countries with all our privileges ought to unsettle us all.”
In Trends in International Mathematics and Science Study (TIMSS), <a href="http://dmanalytics2.com/click?u=https%3A%2F%2Fbusinesstech.co.za%2Fnews%2Fgovernment%2F145121%2Fgovernment-celebrates-south-africas-dismal-maths-and-science-results%2F&amp;i=8&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">results released in 2016</a>, South Africa ranked second last in the world. African countries like Botswana, Egypt and Morocco, performed better than South Africa.
Could independent schools be the solution to South Africa’s education problems?
As government fails to produce desirable results on public education, reforms are urgently needed to make improvements. Government needs to look into encouraging and creating an environment where independent schools can thrive and grow.
Independent schools are already having a significant impact on South Africa’s education. Between 2000 and 2010, <a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.economist.com%2Fnews%2Fbusiness%2F21679790-south-african-entrepreneurs-have-good-ideas-bringing-private-education-masses-school&amp;i=9&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">according to an article that appeared in The Economist</a> in December 2015, the number of government schools established in South Africa fell by 9%; while that of independent schools grew by 44%.
But parents from low income families cannot afford many of the independent schools. Private education is expensive. Government needs to find ways to encourage the establishment of low-fee independent schools to fuel not only competition between private schools, but also competition between low-fee private schools and public schools, and so improve overall basic education in South Africa.
Low-fee private schools have a huge potential. The Spark school in the suburb of Bramley, is a good example of the kind of education system the government could pursue.
“Quality independent schooling such as Spark, priced at R19,100 a year, means families with widely different incomes can afford to, or simply choose to, send their children to low-fee schools,” Lisa Steyn wrote in <a href="http://dmanalytics2.com/click?u=https%3A%2F%2Fmg.co.za%2Farticle%2F2016-12-09-00-boom-in-low-fee-private-schools&amp;i=10&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">the Mail &amp; Guardian in December 2016</a>.
Schools like Spark are badly needed, and the task for government must be to encourage the growth of such low-fee schools so that education becomes competitive and its quality improved.
Competition would improve not only private education, but also public schools, because public schools would have to compete with other schools by providing quality education for South Africa’s youth.
The role played by businesses, parents, and communities in general, is critical in any effort to improve the education sector in this country. These stakeholders, other than our bureaucratic government, must assume greater control of the schools in their communities. The participation of the private sector in our schools would demand greater commitment from all involved.
<a href="http://dmanalytics2.com/click?u=http%3A%2F%2Fwww.tsowell.com%2F&amp;i=11&amp;d=laFzDMa8SyOZus-4KyehcQ&amp;e=Monique.Vanek%40abn360.com&amp;a=guiKLVUoQFC_XeXRrJgI7g">Dr. Thomas Sowell</a>, a senior fellow at the Hoover Institution, once said that there are no solutions in economics, there are only trade-offs. Competition will not be the solution to South Africa’s education problem – but it could be government’s first step towards bringing about significant reforms in the sector.
&nbsp;
Phumlani M. Majozi is a youth co-ordinator and non-executive director at the Free Market Foundation

Op-Ed: Can South Africa’s basic education be fixed?

Your Excellency, 
After the signing of the Appropriation Act on 12th June, 2017, the Nigerian Health Sector Reform Coalition conducted an analysis of the Federal Government’s resource allocation to the entire health sector – including the Federal Ministry of Health. As such, it is our urgent appeal that Your Excellency increases the upcoming 2018 health budget to at least 7.5% of the national budget. This is in line with the Abuja Declaration by African Heads of States that committed 15% of the annual country budget for health. Also, we respectfully request that Your Excellency implements the 1% Consolidated Revenue Fund (CRF) towards the Basic Healthcare Provision Fund (BHCPF) as provided for in the National Health Act 2014. As a coalition of Civil Society Organisations, we are committed to supporting the Federal Government by tracking the funds to the health sector to ensure that the budgeted funds provide appropriate health services to Nigerians. 
Currently, the total amount allocated to the health sector in the 2017 approved Federal Government budget is estimated at N380 billion, 5.1% of the national budget. This includes the allocation to the Federal Ministry of Health (FMoH) at N308 billion (4.1% of the national budget) and allocations to MDAs that are outside the FMoH such as the State House Medical Center, the National Agency for the Control of AIDS (NACA), the National Health Insurance Scheme (NHIS) payment for FG staff not made by the FMoH, as well as other health related allocations. 
The budget for the FMoH increased from N250 billion in 2016 to N308 billion in 2017 and we applaud this 23.2% increase. It is a positive step. In turn the entire health sector allocation increased from N353 billion in 2016 to N380 billion in 2017. This N380 billion is about 4.1% of the 2017 National Budget. However Sir, if we consider the inflationary pressure on the economy, the purchasing power of the Naira, the scale of the health needs, and the sustained growth of the Nigerian population, this increase pales in comparison to the needs of the Nigerian people. 
Therefore, we need the Federal Government and State Governments to invest more for and in health. Health is the foundation of our national security, economic growth and recovery plan. An investment in health not only boosts the economy, but is also a critical determinant of quality of the workforce. An investment of $1 in reducing stunting among children yields $11 in economic benefits, while $1 invested in ensuring breastfeeding yields $35 in economic benefits. In addition, when countries invest $1 in immunizations they stand to gain between $16 to $44 in economic returns.
Right now, millions of Nigerians die needlessly because of the fragile state of healthcare in Nigeria. According to UNICEF, Nigeria’s basic immunization coverage is the eighth worst in the world! More mothers die of largely preventable deaths in Nigeria than anywhere else in the world – 6 mothers die every hour! If we take into account the population, Nigeria has the fourth highest maternal mortality ratio in the world – behind Sierra Leone, Central African Republic and Chad. The Giant of Africa is failing her people. 
With 70% of the disease burden at the primary care level, it is unfortunate that the primary healthcare system is the least funded. Given the imminent exiting (re-prioritization and re-allocation) of funding support from international partners, we must plan to take full responsibility for the health of Nigerians. 
The Health Sector Reform Coalition (HSRC) is a non-partisan group of civil society organisations (CSOs) and non-governmental organisations (NGOs) that are concerned about the health sector in Nigeria. Members of the Coalition, have gathered signatures of over 188,000 Nigerians in our advocacy efforts to increase health funding for all Nigerians, through the #MakeNaijaStronger campaign. The Coalition will remain vigilant for the transparent and proper implementation of the funds towards healthcare provision in Nigeriaia. We pledge to track funds to ensure transparent implementation as part of our social contract to make Nigeria a great and healthy nation. 
Sir, there is an urgent need to make a quantum leap investment into the health sector in the 2018 budget to at least 7.5% of the national budget and demonstrate good faith in implementing the 1% Consolidated Revenue Fund towards the Basic Health Care Provision Fund (BHCPF), as stipulated by the National Health Act 2014. 
Signed by: 
1. Health Reform Foundation of Nigeria (HERFON) 2. Association for the Advancement of Family Planning (AAFP) 
3. Business Day
4. Catholic Secretariat 
5. Centre for Social Justice (CSJ) 
6. Champion for Change (C4C) 
7. Christian Aid Nigeria 
8. Civil Society – Scaling up Nutrition in Nigeria (CS-SUNN) 
9. Civil Society Consultative Group for Health Financing in Nigeria (CCG4HF) 
10. Civil Society Legislative Advocacy Centre (CISLAC)
11. Community Health and Research Initiative (CHR) 
12. Education as a Vaccine (EVA) 
13. Federation of Muslim Women of Nigeria (FOMWAN)
14. Health Systems Consult Limited (HSCL) 
15. Innovation and Access to Development Initiatives (i-Novate 2100) 
16. International Federation of Women Lawyers (FIDA Nigeria)
17. IPAS Nigeria 
18. MamaYe -Evidence4Action 
19. Nigeria Medical Association (NMA) 
20. Nigeria Urban Reproductive Initiative (NURHI) 
21. Pharmaceutical Society of Nigeria (PSN) 
22. Save the Children 
23. Synergy PMP 
24. The Guardian 
25. The Nigeria Health Watch 
26. Vaccine Network for Disease Control 
27. Wellbeing Foundation of Africa 
28. West African Academy of Public Health (WAAPH) 
29. White Ribbon Alliance (WRAN) 
30. Women Advocate and Vaccine Access (WAVA)
THE TIME TO ACT AND INVEST IN HEALTHCARE IS NOW.

Open letter to President Muhammadu Buhari: Urgent Message on the State of Healthcare in Nigeria

NEW YORK (Thomson Reuters Foundation) &#8211; U.S. President Donald Trump’s plan to cut foreign aid supporting HIV/AIDS treatment could cost 9 million years of lost life in South Africa and Ivory Coast, according to a global study released on Monday.
In the first study to measure the impact of cuts in global investment in HIV care in terms of health and costs, scientists found sky-rocketing deaths in the African nations would far outweigh savings.
South Africa has the highest prevalence of HIV worldwide, with 19 percent of its adult population carrying the virus in 2015, according to UNAIDS, with a total of 7 million HIV-infected people.
Ivory Coast counted 460,000 HIV-infected people in that same year.
Trump’s proposed budget for 2018, made public in May, envisions cuts to the President’s Emergency Plan for AIDS Relief (PEPFAR) program, a cornerstone of U.S. global health assistance, which supports HIV/AIDS treatment, testing and counseling for millions of people worldwide.
Under Trump’s budget, which pursues his “America First” world view, PEPFAR funding would be $5 billion per year compared to about $6 billion annually now, the U.S. State Department has said. No patient currently receiving antiretroviral therapy, a treatment for HIV, through PEPFAR funds will lose that treatment, officials have said.
Should the cuts keep South Africans and Ivorians from receiving antiretroviral drugs, an additional 1.8 million HIV-infected people would die over the next 10 years, 11 researchers in America, Europe and Africa concluded, using mathematical models.
The combined deaths amount to nearly 9 million years of life lost, the scientists calculated, in what they said was the first effort to put figures on the proposed cuts.
The researchers measured expected savings over the next decade, whose small scale they said raised efficacy and ethical questions. In South Africa, it would amount to some $900 per year of life lost, compared to $600 to $900 in Ivory Coast.
“We leave it to readers to draw their own conclusions about whether imposing such trade-offs on vulnerable populations accurately reﬂects how donor countries value life in recipient nations,” the researchers wrote in Annals of Internal Medicine.
Savings would eventually dry up over the decade, they found, due to higher costs tied to the spread of HIV amid scaled back screening and care.
&#8220;Would the relatively small savings realized by currently proposed budget reductions be worth these large humanitarian costs?&#8221; said lead author Rochelle Walensky, a professor of medicine at Harvard Medical School.
&#8220;Over the past decade and a half we&#8217;ve spent considerable money to save lives in these and other African nations.&#8221;
Some 90 percent of Ivory Coast&#8217;s funding for HIV care and prevention depends on international aid, while South Africa self-finances most of its HIV expenditures, according to U.S. government figures.
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Reporting by Sebastien Malo @sebastienmalo, Editing by Ros Russell; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women’s rights, trafficking, property rights, climate change and resilience.
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