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With the tough economic times in South Africa, the president Cyril Ramaphosa is looking for investors to help sustain the country. CNBC Africa&#8217;s Karabo Letlhatlha spoke to CEO of Investec, Fani Titi about which role the company will play to contribute towards an economic turnaround.

Investec’s role in SA’s economic turnaround

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At the Africa Oil Week held in Cape Town this week, CNBC Africa’s Fifi Peters caught up with Steven Winberg, Assistant Secretary for Fossil Energy, United States of America and Francis R. Fannon, Assistant Secretary for Energy Resources, US Department of State, to discuss the US interest in Africa’s energy market.

Africa Oil Week: Unpacking US interests in Africa’s oil markets

South Africa is not inward looking. This is according to the country’s <a href="https://www.cnbcafrica.com/videos/2019/11/05/exclusive-in-conversation-with-sas-president-cyril-ramaphosa/">President Cyril Ramaphosa, speaking to CNBC Africa in an exclusive interview</a>. He was responding to a question by Pierre Celestin Rwabukumba, CEO of the Rwanda Stock Exchange on South Africa’s regional integration policy, which <a href="https://www.afdb.org/en/countries/southern-africa/south-africa/south-africa-economic-outlook">according to the African Development Bank</a>, is often seen as inward looking and to what the most industrialised country should be doing as a leading country on the continent for the African Continental Free Trade Agreement.



Elaborating Ramaphosa said: “I was a bit taken aback when the report said we are inward looking because in real effect South Africa isn’t. I have been travelling in a number of countries on our continent, recently I went Tanzania alone, and I found that there were 228 companies from South Africa that operate there and indeed if you go throughout the continent you will find that a number of South African companies that trade there. From a government point of view we have missions in nearly all the African countries on our continent, so in that alone we are a more of an outward looking type of South Africa.” 



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He added that South Africa wants to enhance this and that is why the African Continental Free Trade Agreement is going to have a major beneficial effect.



Explaining, Ramaphosa said this is because South Africa is going to be able to utilise the agreement to move goods and services from a non-tariff point of view and people will be able to move around the continent as well.



He however said the benefits will not only be a great opportunity to develop South Africa’s economy, but that of other countries. 



“We want to trade more effectively with other regions on our continent and the Africa Free Trade agreement just gives us a greater opportunity which we are going to exploit to greater effect. South Africa is going to be much more open for business, trading and investment. 



“We also want other African countries to come and invest in South Africa &#8211; this has been a sore point for me because not many African companies have been investing in our economy. We therefore want to enhance trade. I want to be drinking more and more coffee from Rwanda, Uganda and places like that rather than coffee from Columbia and places outside our continent and we want those economies to come and invest in our economy as well.”

President Ramaphosa: Why SA is not inward looking

HARARE, Nov 4 (Reuters) &#8211; Zimbabwe police have given public sector workers permission to march for better pay on Wednesday in what is widely seen as a test of President Emmerson Mnangagwa&#8217;s willingness to tolerate dissent.



A notice received from police by the Apex Council of public sector unions said the protest could go ahead but also warned that police would stop the march if it turned violent.



&#8220;The regulating authority still reserves the right to stop the gathering should it turn out to a public order threat or violent. Police will monitor,&#8221; Oscar Mugomeri, police commander for Harare central district, wrote in the letter.



Mugomeri could not be reached for comment on Monday.



Unions say Mnangagwa&#8217;s government has not responded to demands for U.S. dollar-indexed salaries to cushion public sector workers against inflation that economists say reached 380% in September.



Daily life in Zimbabwe is getting harder, with prices of basic goods, fuel and electricity rising as hope fades for a quick economic recovery under Mnangagwa, who took power after the late Robert Mugabe was ousted in a coup in 2017.



Mnangagwa has banned several opposition protests and faces accusations that he is using Mugabe&#8217;s heavy-handed tactics.



Police have been on high alert since January, when fuel protests turned violent and at least a dozen people were killed during a security crackdown.



Unions want the lowest government employees paid the equivalent of $475 (7,251 Zimbabwe dollars) a month compared to the 1,023 Zimbabwe dollars they earn now.



Finance Minister Mthuli Ncube, who projects the economy to contract by 6.5% this year, has said the government cannot meet the workers&#8217; demands.



Charles Chinosengwa, spokesman for the Apex Council, which represents 230,000 workers &#8211; excluding the health and security sectors &#8211; said unions were mobilising members from across Zimbabwe.



&#8220;This is strictly a labour issue. We don&#8217;t need support from politicians, we are saying hands off to politicians,&#8221; he said.



Shortages of foreign currency, fuel and power are among the most visible signs of a crisis that has revived memories of 2008, when hyperinflation wiped out savings and forced the government to abandon its currency.



Mnangagwa says Zimbabweans should be patient while his government pursues economic reforms, including gradually cutting subsidies on fuel and electricity and the re-introduction of the domestic currency.



$1 = 15.2654 Zimbabwe dollars 



(Reporting by MacDonald Dzirutwe, Editing by Timothy Heritage)

Zimbabwe police give unions green light for public sector protest, what you need to know…

The Diamond Conference speaks to the core aspirations of the partnership between Government and De Beers Group in support of the aspirations of our producer governments to continue to play a leadership role in the diamond value chain and create economic impact for the communities.



Africa is the world&#8217;s largest producer of diamonds, producing as much as 50% of global production. To date, Africa has produced over 75%, in value, of the world&#8217;s diamonds with more than 1.9 billion carats worth an estimated $US 158 billion mined.



The Diamond Conference is the only Diamond specific forum on the African continent and over the past 4 years has evolved in size, influence and significance as a key platform for engagement for the global Diamond Industry.



<h2 class="wp-block-heading">The theme of the 2019 conference is: Consumer | Community | Cluster Development | Collaboration</h2>



In accordance with the principles of the De Beers value proposition the 2019 Diamond conference will further facilitate our engagement strategy with a primary focus on the 4Cs:



Consumer Confidence&nbsp;– the changing consumer landscape, trends and its impact on the diamond value chain.



Community&nbsp;&#8211; The importance of establishing a multi-stakeholder approach to enhancing the sustainability of diamond equity focusing on Economic, Social and Environmental imperatives.



Cluster Development&nbsp;– in terms of the diamond supply chain, innovation, disruption and various factors that impact the industry directly or indirectly. There is need to explore the opportunity to create a self-regulating, evidence-based innovation pipeline that will support commercial longevity in the current global context.



Collaboration&nbsp;– the value of collaborative relationships to address shared risks that impact the diamond sector.



For more info visit <a href="http://www.thebotswanadiamondconference.com/index.html">http://www.thebotswanadiamondconference.com/index.html</a> 



Content provided by De Beers Group

Why the Diamond Conference remains a key platform for engagement for the global diamond industry

By <a href="https://theconversation.com/profiles/sean-mfundza-muller-298216">Seán Mfundza Muller</a>, <a href="http://theconversation.com/institutions/university-of-johannesburg-1275">University of Johannesburg</a>

Over the past decade South Africa’s public finances have <a href="https://theconversation.com/south-africas-finance-minister-delivers-a-budget-designed-to-steady-the-ship-112162">come under more and more strain</a>. The days when the economy was growing and former finance minister Trevor Manuel brought baskets of fruit to parliament have been replaced by declines in the <a href="https://tradingeconomics.com/south-africa/gdp-per-capita">size of the economy per person</a> and rising unemployment. This was symbolised earlier this year when finance minister Tito Mboweni <a href="https://www.fin24.com/Budget/mboweni-plum-season-is-over-but-it-can-come-again-20190220">brought</a> a few drought-resistant bitter aloes to his budget speech.

These hard times have three main origins: the economic legacy of apartheid, the effects of the 2008 global financial crisis, and the massive <a href="https://theconversation.com/why-ramaphosas-new-dawn-will-break-slowly-for-south-africas-finances-105302">damage done</a> by inaction and state capture during President Jacob Zuma’s tenure. 

Apartheid systematically limited the human development of the majority of the population. It destroyed communities, created costly spatial inequalities and led to extreme inequalities between race groups. Among the negative consequences were its contribution to skills shortages, high unemployment, high <a href="https://mg.co.za/article/2015-11-15-commuting-costs-the-poor-dearly">transport costs for workers</a>, dependency on the state and high crime rates. 

Twenty-five years later the country’s debt levels continue to exceed targets despite additional measures to raise tax revenue. The situation has been compounded by the worsening finances of state-owned enterprises. The result is that public finances are becoming a burden on the economy because of the tax revenues required. And due to increasing borrowing costs resulting from credit rating downgrades.

Because of these and other factors, South Africa faces a unique combination of challenges. This makes addressing the country’s economic problems vastly more difficult. Economic and fiscal policies used successfully in other countries cannot simply be imitated.

The presidency of Cyril Ramaphosa has shown a dramatic shift from the Zuma era. The main change is that it appears to genuinely carry good intentions – a focus on rebuilding the state and growing the economy, rather than looting both. 

But good intentions are, unfortunately, insufficient. On top of this, the quality of advice Ramaphosa and Mboweni have to draw on for bright ideas in these dark times appears very low and often ideologically tainted. That doesn’t bode well for the country’s prospects.

<h2>Bad advice across the spectrum</h2>

Good political leaders rely on the expert advice of others. This is also true when it comes to public finances and economic policy. But South Africa is thin on such expertise.

This is evident in the kinds of solutions put forward by commentators such as the former deputy finance minister, Mcebisi Jonas. He has <a href="https://www.timeslive.co.za/news/south-africa/2019-08-16-shock-therapy-to-shield-sa-from-collapse-plus-5-highlights-from-the-new-vrye-weekblad/">repeatedly called</a> for <a href="https://www.latimes.com/archives/la-xpm-1990-04-26-mn-343-story.html">“shock therapy”</a> for parts of the economy. Shock therapy was a term used for extreme measures taken in former Soviet countries. It was driven by ideologically conservative economists, to introduce various aspects of capitalism. 

This would be an inappropriate path to follow in a country like South Africa where, in any case, the private sector controls more of the economy than the state. It also reflects ignorance about the <a href="http://johnmarangos.eu/wp-content/uploads/2014/10/43-2007-Int.%20J.%20Economic%20Policy%20in%20Emerging%20Economies.pdf">history of shock therapy</a> and its failings. 

This is perhaps unsurprising. Even one of the most highly qualified economists on the presidential economic advisory council <a href="https://twitter.com/thabileoka/status/1156709421415878656">recently claimed</a> that austerity might help reduce South Africa’s high rate of unemployment. An assertion like this is, in my view, shocking. It ignores the <a href="https://www.theguardian.com/business/2013/jun/05/imf-underestimated-damage-austerity-would-do-to-greece">harm caused by austerity measures</a> and fails to acknowledge the structural origins of South Africa’s high unemployment rates.

On the left of the spectrum, some commentators still seem to be stuck in the arguments of the mid-1990s. There are calls for “<a href="https://www.dailymaverick.co.za/opinionista/2019-06-04-part-one-lets-build-a-new-economy-for-the-many-not-just-the-few/">fiscal stimulus</a>” or <a href="https://www.sowetanlive.co.za/news/south-africa/2018-09-05-ramaphosa-must-act-now-economists/">changes in monetary policy</a> to unlock economic growth. 

There are many reasons to believe that these proposals <a href="https://businesstech.co.za/news/energy/327305/south-africa-wont-consider-quantitative-easing-to-help-eskom/">are inappropriate</a>. In any event, they would have only a small chance of success. Worse still, the advocates of these policies <a href="https://www.businesslive.co.za/bd/opinion/letters/2019-08-08-letter-high-debt-cannot-be-ignored/">selectively ignore threats to public finances</a> and fail to consider the damage that would result from their proposals not working. 

While left-wing commentators are scathing about importing ideas from institutions like the International Moneary Fund (IMF), their own arguments about fiscal and monetary policy <a href="https://www.businesslive.co.za/bd/opinion/letters/2019-06-13-letter-quantitative-easing-cannot-be-used-as-policy-tool-to-drive-development-in-sa/">inappropriately parrot</a> those made by so-called heterodox economists in developed countries. An <a href="https://af.reuters.com/article/southAfricaNews/idAFL8N23B29A">infamous</a> manifestation of this was the African National Congress secretary-general’s damaging call for quantitative easing.

Another shibboleth is <a href="https://www.iol.co.za/business-report/budget/south-africa-to-reach-the-fiscal-cliff-by-2042-19443575">that</a> the country faces a “fiscal cliff” and must contain or cut public sector wages and social expenditure. 

In my view the <a href="http://www.scielo.org.za/scielo.php?script=sci_arttext&amp;pid=S0041-47512014000100009">concept is deeply flawed</a>. It is based on overly simplistic assumptions about trends in government spending and a conception of public finance sustainability that has no credibility internationally. 

<h2>Bold words, but timid policy</h2>

Ramaphosa and Mboweni have been doing their political part in playing up the prospects of the national treasury’s economic strategy paper. But the document is made up mostly of recycled ideas that are likely to have limited effect, or are simply bad. One example is that of introducing transport and water regulators, in the face of evidence that <a href="https://theconversation.com/south-africa-is-planning-more-regulators-this-is-a-bad-idea-123572">this would be a bad idea</a>.

The composition of the <a href="http://www.thepresidency.gov.za/press-statements/president-appoints-economic-advisory-council">advisory council</a> established by the presidency, while clearly well-intentioned, also leaves a lot to be desired. The presence of two high-profile international economists with limited local knowledge, along with private sector economists and academics who specialise in commentary rather than substantive analysis, makes the council appear rather superficial.

The country’s high debt levels, repeated under-collection of tax revenue, flailing state-owned enterprises and non-existent economic growth mean that there is very little room for creativity in public finances. Instead, while the upcoming medium-term budget may try to paint a positive picture of prospects in distant years it will – as is now the norm – be focused on crisis management.

In the absence of a clear-eyed vision for the role of the state in relation to the economy and socio-economic outcomes, only good fortune will spare South Africa from stagnation, or a further worsening of public finances.<img loading="lazy" decoding="async" src="https://counter.theconversation.com/content/125990/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" />

<a href="https://theconversation.com/profiles/sean-mfundza-muller-298216">Seán Mfundza Muller</a>, Senior Lecturer in Economics and Research Associate at the Public and Environmental Economics Research Centre (PEERC), <a href="http://theconversation.com/institutions/university-of-johannesburg-1275">University of Johannesburg</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/tough-times-and-bad-advice-are-holding-back-south-africas-economy-125990">original article</a>.

What’s holding back South Africa’s economy?

JOHANNESBURG &#8211; South Africa’s rand firmed on Friday as an unexpected bounce in Chinese factory activity helped offset concerns over prospects of a U.S.-China trade pact and skittishness ahead of a long-awaited decision on South Africa’s credit rating.



The rand traded at 15.0600 versus the greenback by 0505 GMT, 0.31% stronger compared with the previous day’s close.



The currency had been losing ground following a bleak budget speech on Wednesday, where Finance Minister Tito Mboweni slashed growth forecasts and predicted ballooning debt.



That raised fears that South Africa could lose its last investment-grade credit rating on Friday, when Moody’s is set to announce its ratings decision following a review, also knocking confidence in the rand.



However, investor sentiment was given a boost on Friday after a survey showed that manufacturing activity in China expanded at its fastest pace in more than two years in October, lifting Asian shares.



Throughout the day, though, the rand is likely to be driven by Moody’s decision. Peregrine Treasury Solutions said in a note there was no telling the impact a negative adjustment in its rating could have: “For now, it’s just sit back and hold tight, with a new support level of R15.00 having been set.”



Government bonds inched lower, with the yield on benchmark 2026 instrument rising 1 basis point to 8.505%.



Reporting by Emma Rumney; Editing by Aditya Soni

Unexpected bounce in Chinese factory activity lifts South African rand ahead of Moody’s review

<figure>
 <img decoding="async" src="https://images.theconversation.com/files/299421/original/file-20191030-17901-1fi03vh.jpg?ixlib=rb-1.1.0&#038;q=45&#038;auto=format&#038;w=754&#038;fit=clip" />
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 For Africa’s urban populations, new cities might not be the surest solution.
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<a href="https://theconversation.com/profiles/astrid-r-n-haas-215011">Astrid R.N. Haas</a>, <a href="http://theconversation.com/institutions/international-growth-centre-2530">International Growth Centre</a>

By 2050 an estimated <a href="https://www.un.org/development/desa/en/news/population/2018-world-urbanization-prospects.html">2.5 billion more people</a> will be added to urban areas, with 90% of this growth taking place in Africa and Asia. According to Nobel Prize winning economist, Paul Romer, this will mean the <a href="https://www.theguardian.com/cities/2019/jul/10/should-we-build-cities-from-scratch">building of more urban areas</a> in the next 100 years than currently exist today.

If managed effectively, Africa’s cities will drive the continent’s economic growth, and thereby help reduce poverty. To date, however, Africa has yet to realise the positive gains of rapid urbanisation experienced elsewhere. Instead, increasingly concentrated populations have become a major stress on the limited infrastructure and services, such as housing, employment, health, education, and safety.

Retrofitting cities, where cities already exist, can be up to <a href="https://www.lincolninst.edu/sites/default/files/pubfiles/regularization-informal-settlements-latin-america-full_0.pdf">three times more expensive</a> than planning for infrastructure in advance of settlement. Therefore, some leaders see the construction of whole new cities as the <a href="https://www.theguardian.com/cities/2019/jul/10/should-we-build-cities-from-scratch">overall solution</a> to overcome the pressures on existing ones.

The idea of constructing new cities to solve urbanisation challenges is not new. In Africa, for example, the first post-independence wave came with some governments deciding to move their capital cities. 

The motivations for this varied. In the case of Yamoussoukro, which was declared the capital of Côte d’Ivoire in 1983, the move reflected the desire of the then president Houphouët-Boigny to have the <a href="https://slate.com/news-and-politics/2004/03/what-drives-a-country-to-switch-its-capital-city.html">capital</a> located in his home town. 

Nigeria, on the other hand, Abuja became the new capital in 1991 to relieve population pressures in Lagos. The choice of the site for Abuja was motivated by the fact that it was located in the centre of the country. It is also <a href="https://www.ft.com/content/68c28016-bb16-11e3-948c-00144feabdc0">more ethnically neutral</a> as it was located between the country’s northern, majority Muslim population and southern, largely Christian population. The creation of the city of Abuja, therefore, was also to help bridge the divisions in the country in <a href="https://www.citylab.com/equity/2017/04/why-capital-city-relocation-might-not-be-such-a-bad-idea-after-all/522321/">terms of politics as well as economic opportunity.</a> 

The fortunes of Yamoussoukro and Abuja offer important lessons for current planners of new cities – <a href="https://www.theguardian.com/cities/2019/jul/10/should-we-build-cities-from-scratch">120</a> are being built in 40 countries. 

Although some people were attracted to Yamoussoukro by the prospect of a newly constructed international airport, and even the <a href="https://www.france24.com/en/20190125-video-revisited-ivory-coast-yamoussoukro-abandoned-capital-houphouet-boigny-crocodiles">world’s largest church</a>, most stayed away. While it continues to be the country’s administrative capital, most government institutions remain in Abidjan. On top of this, Abidjan is still the vastly more popular city. It is the economic hub of the country, with an estimated population of <a href="http://worldpopulationreview.com/countries/ivory-coast-population/cities/">close to 4 million</a>. Yamoussoukro’s population is approximately <a href="http://worldpopulationreview.com/countries/ivory-coast-population/cities/">200,000</a>, making it only the 6th largest city in the country.

Any new city takes time to grow. Abuja, though still much smaller than Lagos, which remains Nigeria’s economic hub, has, however, already experienced rapid population growth since it was founded. In 1987 its population was only <a href="http://blogs.umb.edu/buildingtheworld/founding-of-new-cities/the-founding-of-abuja-nigeria/">about 15,000 people</a>. Today, it has a <a href="http://worldpopulationreview.com/world-cities/abuja-population/">population of over 3 million</a>. 

Although not without <a href="https://www.aljazeera.com/indepth/features/nigeria-clearing-locals-abuja-capital-180408072143042.html">its own challenges,</a> there were two major advantages of Abuja. Firstly, at the time of its conception, the Nigerian government had a <a href="https://www.aljazeera.com/indepth/features/nigeria-clearing-locals-abuja-capital-180408072143042.html">large amount of petrodollars</a>. This meant that major investments in its infrastructure, such as water lines, could <a href="http://blogs.umb.edu/buildingtheworld/founding-of-new-cities/the-founding-of-abuja-nigeria/">largely be made in advance of people settling</a>. 

In addition, unlike Yamoussoukro, major government institutions were moved to Abuja. This spurred initial population movement, as the government civil service had an incentive to move there.

<h2>The myth of smart cities</h2>

The current wave of new city building is largely focused on leap-frogging economic development and moving Africa’s cities directly into the age of futuristic, technologically advanced, so-called ‘smart cities’. Plans for these types of cities are sprouting up across the continent; from <a href="https://www.reuters.com/article/us-kenya-china/kenya-secures-666-million-from-china-for-tech-city-highway-idUSKCN1S21KG">Kenya,</a> <a href="https://www.theguardian.com/cities/2016/may/23/story-cities-48-ebene-cybercity-mauritius-vision-africa-smart-future">Mauritius</a> and <a href="https://qz.com/africa/1352926/will-senegals-diamniadio-city-solve-dakars-problems/">Senegal</a>. 

Leading the way is Nigeria with five current on-going new city projects, which, when completed, are set to cover a landmass of <a href="https://qz.com/africa/1461626/eko-atlantic-diomniadio-tatu-africas-new-billion-dollar-cities/">25 million square metres</a>. The agenda of new city building is not only being pushed by governments, but by a <a href="https://www.theguardian.com/cities/2019/jul/10/should-we-build-cities-from-scratch">vast array of construction, real estate and technology companies</a>, who stand to profit from the city construction boom, as well.

Yet these new cities will want to avoid pitfalls of places like Cyberjaya, Malaysia. <a href="https://www.wired.co.uk/article/malaysia-cyberjaya-silicon-valley-smart-cities">Cyberjaya</a> was the Malaysian government’s attempt to emulate Silicon Valley and pioneer such a hub in Asia.

Cyberjaya was built on <a href="http://www.cyberjayamalaysia.com.my/about/the-story">2,800 hectares of undeveloped land, 40km south of Kuala Lumpur</a>. The idea behind the city was to create a space where intelligent minds from across the globe could reside comfortably and just concentrate on innovation. Malaysia hoped that its first mover advantage in the smart city arena would attract investors. They also believed that Cyberjaya could be a model for the city of the future.

Yet <a href="https://www.tandfonline.com/doi/abs/10.1080/10225706.2012.659192?journalCode=rage20">Cyberjaya has failed to live up to its reputation</a>. In particular, a fundamental design flaw was the lack of understanding that people move to cities not only for the infrastructure but also the amenities, as well as to build networks and to integrate into existing networks. In conceptualising Cyberjaya, the Malaysian government largely ignored this. 

Rather the city <a href="https://www.tandfonline.com/doi/abs/10.1080/10225706.2012.659192?journalCode=rage20">was envisaged</a> only for the highly educated elite, who, it was assumed, did not require many further amenities outside a suitable work environment. As a result of the failure to understand the human aspect of cities, <a href="https://www.wired.co.uk/article/malaysia-cyberjaya-silicon-valley-smart-cities">many parts of Cyberjaya have remained vacant to date.</a>

Many of Africa’s upcoming “smart cities” exhibit similar conceptualisation flaws. Senegal’s futuristic city Diamniadio, a core part of <a href="https://qz.com/africa/1352926/will-senegals-diamniadio-city-solve-dakars-problems/">President Macky Sall’s 2035 plan</a>, is meant to be a “city of knowledge”. It will comprise an industrial park with entertainment facilities and residential areas. However, when the city is completed, which is intended to be by <a href="https://www.businessinsider.com/senegal-building-2-billion-futuristic-city-inspired-by-nature-2018-9?r=US&amp;IR=T">2035</a>, it is unlikely that the majority of Senegalese <a href="https://qz.com/africa/1352926/will-senegals-diamniadio-city-solve-dakars-problems/">will be able to afford to live there</a>.

An estimated <a href="https://qz.com/africa/1461626/eko-atlantic-diomniadio-tatu-africas-new-billion-dollar-cities/"> US$100bn</a> is being invested in new city projects across Africa; Diamniadio alone will cost the Senegalese government <a href="https://qz.com/africa/1352926/will-senegals-diamniadio-city-solve-dakars-problems/">an estimated US$2bn</a>. The assumption is that these investments will pay off. The logic is that these cities will attract the best and the brightest. In turn this should drive productivity increases that ultimately will repay the large loans. 

In addition, as the new city of Eko Atlantic City in Nigeria has shown, <a href="https://www.propertypro.ng/blog/land-price-in-eko-atlantic-now-sells-for-1720-per-square-metre/">land prices may increase substantially</a>. So, if the government can capture these through land based taxes, this can help recoup costs too. 

But failure invariably comes with large debt bills that African countries cannot afford, and may leave large, unfinished ghost cities in its wake. 

<h2>Not easy</h2>

As the case of Cyberjaya and other failed new city projects globally demonstrate, successfully designing new cities from scratch is not easy. Cities are complex systems. They require the necessary infrastructure to function. <a href="https://www.governing.com/columns/mgmt-insights/Hope-to-Be-the.html">Silicon Valley has been successful</a> as the infrastructure and regulatory environment has meant firms have clustered and learned from each other, spurring innovation.

But none of this matters without people being willing to live there. And what attracts people into cities are opportunities for social interaction and the socio-economic networks. In the case of Silicon Valley’s success, for example, it’s clear that the entrepreneurs employed by the firms themselves care about the business environment as well as the <a href="https://www.governing.com/columns/mgmt-insights/Hope-to-Be-the.html">quality of life for themselves and their families</a>.

Building new smart cities, in the hope people will follow, may be a higher-risk gamble that most African governments cannot afford. A surer bet is to study where people are already moving, which means where <a href="https://marroninstitute.nyu.edu/programs/urban-expansion">future urbanisation is likely to happen</a>. Laying the foundations for this urbanisation to happen in an orderly and well-managed fashion, such as delineating basic road systems and investing in basic infrastructure before settlement takes place, as was done in Abuja, will go a long way to harness the potential of Africa’s urbanisation.<img loading="lazy" decoding="async" src="https://counter.theconversation.com/content/126099/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" />

<a href="https://theconversation.com/profiles/astrid-r-n-haas-215011">Astrid R.N. Haas</a>, Senior Country Economist (Cities) and Manager of Cities that Work, <a href="http://theconversation.com/institutions/international-growth-centre-2530">International Growth Centre</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/building-new-cities-to-meet-africas-rapid-urbanisation-is-a-risky-bet-126099">original article</a>.

Urbanisation_shutterstock

Here’s why building new cities to meet Africa’s rapid urbanisation is a risky bet

Africa’s largest mobile operator by subscribers said in a quarterly update on Thursday that certain conditions related to the transaction had not been met, which led to the company’s decision.



Chief Financial Officer Ralph Mupita said on a call with reporters that the bid for MTN’s stake in the business had been unsolicited, and it was for now no longer being held for sale.



“In the longer term, if somebody came with a very attractive offer for the business, we’ll apply our minds then,” he said.



A 15 billion rand ($1.00 billion) divestment plan is making “steady process”, Mupita said, adding that the company was in advanced discussions around the disposal of a 49% holdings in ATC Ghana and ATC Uganda, which it values at 7 billion rand and 8 billion rand, respectively.



MTN is reviewing a raft of investments under a three-year plan that includes shedding loss-making e-commerce assets and exiting countries where it has no prospect of reaching the top-two spots in terms of market share.



It is aimed at slimming the company down and honing its focus on high-growth markets on the continent and in the Middle East after clashes with regulators in Nigeria, Uganda and elsewhere crimped growth.



It said on Thursday its service revenue for the nine-months to Sept. 30 rose by 9.6% year-on-year, buoyed by strong performances from its Nigeria and Ghana operations.



However, in its home market South Africa, where a sluggish economy, high unemployment and rising living costs have hurt consumer finances, service revenue over the period was flat.



($1 = 14.9979 rand)



Reporting by Emma Rumney; Editing by Muralikumar Anantharaman and Rashmi Aich

MTN has cancelled $300 million stake sale in Mascom Wireless Botswana, here’s why

MAPUTO, Oct 29 (Reuters) &#8211; Mozambique&#8217;s main opposition party Renamo on Tuesday appealed the result of the Oct. 15 general election, calling on the country&#8217;s top court to annul incumbent President Filipe Nyusi&#8217;s victory.



Nyusi and his ruling Frelimo party won big in the election, which was hoped would calm tensions in Mozambique, soon to become a top global gas exporter. Instead, the contested result has stoked divisions as opposition parties have cried foul.



&#8220;We want the election results to be annulled because they were not elections. They were a caricature, a circus show,&#8221; Venâncio Mondlane, a Renamo representative, told Reuters by phone.



&#8220;Today we filed the appeal to the Constitutional Council (CC) against the deliberation of the National Election Commission, which we do not agree with. We demand that the CC annul the election results,&#8221; Mondlane said.



It was hoped the election could set the seal on a fragile peace pact, designed to put a definitive end to four decades of violence between Frelimo and Renamo.



The two fought a 16-year civil war that ended in a truce in 1992 but have clashed sporadically since.



Renamo had wanted to win control of a number of provinces in Mozambique&#8217;s centre and north but came away empty handed. 



(Reporting by Manuel Mucari; editing by Grant McCool)

Mozambique’s main opposition party plans to appeal election result

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Famous Brands has released its interim results for the six months-end August 2019. The food services franchisor which owns Mugg &#038; Bean, Steers and Wimpy has seen a rise of consumers ordering food online, putting the sustainability of restaurants on the line. The group declared an interim dividend of 90 cents per share. CEO of Famous Brands, Darren Hele joins CNBC Africa to discuss the numbers further.

CEO Darren Hele breaks down Famous Brands’s half-year results

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Robotic surgery has successfully been applied to almost 2 000 major urological procedures at The Urology Hospital, Pretoria and is considered the future for medicine. Dr Kabo Ijane, who is Africa’s first black robotic surgeon, encourages his peers to embrace robotic surgery. He joins CNBC Africa for more.

From miner to first black robotic surgeon: Dr Kabo Ijane takes us through his life journey

Press Release



Now in its third year, the Absa Africa Financial Markets Index evaluates financial market development in 20 countries across the African continent and the improvements show the progress being made within the financial markets.



Apart from the progress shown in the overall score, the biggest improvement was in ‘legality and enforceability of standard financial markets master agreements’, where the average score jumped to 55 from 47.



‘The steady improvement across African countries is partly a testament to the impact that our Index is having across the continent,’ says George Asante, Head of Global Markets for Absa Regional Operations. ‘The Index is putting the right level of peer pressure on policy makers across Africa and we are seeing a concerted effort to react to the findings. The Index is becoming a powerful barometer for policy makers and playing a role in building an Africa which is able to fund itself.’ An excellent example of this is Ethiopia, which announced plans to launch a stock exchange in 2020, a sure sign of the significant potential for improvement in the coming year.



We welcome these vital signs of improvement in several African countries,’ says David Marsh, chairman of OMFIF. ‘The launch of new products or regulatory improvements prove that the African continent is moving in the right direction, and our index is now a piece of important evidence for tracking progress in the region’.&nbsp;



For more visit &gt;&gt; https://www.absa.co.za/corporate-and-investment-banking/news-and-events/events/absa-africa-financial-markets-index1/

Here’s how Absa is planning to take you further into Africa than ever before

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Tech entrepreneurs play a vital role in developing economies as they respond to the real demands of economic job creation and opportunities. For more on how African tech entrepreneurship can be enhanced and utilised effectively to benefit the economy, James Hedley, Founder of Quicket joins CNBC Africa.

James Hedley on how ticketing company

James Hedley on how ticketing company, Quicket is aiding African economies

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Cecil Chikezie figured out a way to turn agricultural waste into sustainable sources of energy by carbonating the waste and turning it into briquettes that can burn longer and with less carbon footprint than coal. CNBC Africa spoke to Cecil for more.

Cecil Chikezie on entrepreneurship

Cecil Chikezie on entrepreneurship, turning agricultural waste into sustainable energy

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The Anzisha prize recognises young entrepreneurs from across the continent. And the young business people get a chance to learn from and network with industry leading experts chosen to help them along their entrepreneurial journey. Patricia Chin-Sweeney, Co-Founder and MD of IDEV Africa joins CNBC Africa for more.

Patricia Chin-Sweeney gives entrepreneurial advice to start-ups in Africa

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Sasol’s joint CEOs Bongani Nqwababa and Stephen Cornell voluntarily resigned following a review of its Lake Charles Chemicals project, which has been hit by delays and rising costs. Sasol’s share price has lost more than a third of its value in 2019 and has declared that they will not declare a dividend in this reporting period. Portfolio Manager at Benguela Global Fund Managers, Karl Gevers joins CNBC Africa for more.

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Africa Oil Week: Unpacking US interests in Africa’s oil markets

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Zimbabwe police give unions green light for public sector protest, what you need to know…

Why the Diamond Conference remains a key platform for engagement for the global diamond industry

What’s holding back South Africa’s economy?

Unexpected bounce in Chinese factory activity lifts South African rand ahead of Moody’s review

Here’s why building new cities to meet Africa’s rapid urbanisation is a risky bet

MTN has cancelled $300 million stake sale in Mascom Wireless Botswana, here’s why

Mozambique’s main opposition party plans to appeal election result

CEO Darren Hele breaks down Famous Brands’s half-year results

From miner to first black robotic surgeon: Dr Kabo Ijane takes us through his life journey

Here’s how Absa is planning to take you further into Africa than ever before

James Hedley on how ticketing company, Quicket is aiding African economies

Cecil Chikezie on entrepreneurship, turning agricultural waste into sustainable energy

Patricia Chin-Sweeney gives entrepreneurial advice to start-ups in Africa

Analyst responds to Sasol joint CEOs biting the dust

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Southern Africa

Investec’s role in SA’s economic turnaround

Africa Oil Week: Unpacking US interests in Africa’s oil markets

President Ramaphosa: Why SA is not inward looking

Zimbabwe police give unions green light for public sector protest, what you need to know…

Why the Diamond Conference remains a key platform for engagement for the global diamond industry

What’s holding back South Africa’s economy?

Unexpected bounce in Chinese factory activity lifts South African rand ahead of Moody’s review

Here’s why building new cities to meet Africa’s rapid urbanisation is a risky bet

MTN has cancelled $300 million stake sale in Mascom Wireless Botswana, here’s why

Mozambique’s main opposition party plans to appeal election result

CEO Darren Hele breaks down Famous Brands’s half-year results

From miner to first black robotic surgeon: Dr Kabo Ijane takes us through his life journey

Here’s how Absa is planning to take you further into Africa than ever before

James Hedley on how ticketing company, Quicket is aiding African economies

Cecil Chikezie on entrepreneurship, turning agricultural waste into sustainable energy

Patricia Chin-Sweeney gives entrepreneurial advice to start-ups in Africa

Analyst responds to Sasol joint CEOs biting the dust

News Tips

Advertise With Us

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