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African business, politics and lifestyle

July 2nd, 2009

Is Obama Snubbing Kenya on Africa trip?

Posted by: Andrew Cawthorne

President Barack Obama’s choice of Ghana for his first visit to sub-Saharan Africa since taking office has stirred debate in his father’s homeland Kenya. 
 

 

 

 

 

 

 

 

 

 

Some Kenyans believe Obama ought to have come “home” first. Others, especially among critics of President Mwai Kibaki’s government, say he has deliberately shunned the country to show U.S. disapproval of rampant corruption and nepotism in political circles here.
 
Prime Minister Raila Odinga, who comes from the Luo ethnic group like Obama’s father, said it was wrong to read too much into Obama’s itinerary, given that neither was he visiting other influential nations in the region like South Africa and Nigeria.
 
“Ghana is symbolic. It was the first African country to gain independence from Britain in 1957. Ghana is very advanced in its transition to democratic form of governance. So it is perfectly logical,” he told Reuters.
 
“If Obama were to come to Kenya as the first country in Africa, it would send some very wrong signals that he is coming here merely because of some organic relationship that he has with this country. So in fact it is good.”
 
Obama has been to Kenya several times, most recently as a senator in mid-2006. In a speech then, he took a strong line against corruption, which has plagued East Africa’s largest economy for decades. “If the people cannot trust their government to do the job for which it exists - to protect them and promote their common welfare - then all else is lost. That is why the struggle of corruption is one of the great struggles of our time,” he said.
 
That speech drew a sharp response from the government. Spokesman Alfred Mutua called Obama a young man who was “very poorly informed” and chided him for “lecturing” Kenyans. When Obama took power, however, the Kibaki government was so happy it announced a national holiday in his honour. The U.S. leader is wildly popular among all sectors of Kenyan society.
 
So should Obama have included Kenya on his Africa tour? Is he snubbing his ancestral homeland?

June 30th, 2009

from Reuters Soccer Blog:

Confederations Cup defies pessimists but is World Cup on course?

Posted by: Barry Moody

So, the Confederations Cup is over and much of the pessimistic handringing beforehand proved unfounded.

Despite some real logistical problems, the general verdict seems to be that the tournament was a success with enthusiastic and colourful crowds and some classy and unpredictable football, not least the United States' shock semi-final defeat of Spain and a thrilling final where Brazil went 2-0 down to the Americans before storming back to win 3-2 and ensure the football world was not thrown off its axis.

Crucially, South Africa's own team, Bafana Bafana, did a lot better than many of their own fans had expected. The side suffered a lot of bad press from their terrible pre-competition form -- they did not even qualify for next year's African Nations Cup finals -- and Brazilian coach Joel Santana had been treated with scepticism by football writers and fans alike. Even Danny Jordaan, chief executive of the organising committee for next year's World Cup, expressed concern over their form.

After a slow start, however, South Africa turned in a creditable, if not outstanding performance. They reached the semi-final and held eventual champions Brazil until the 88th minute when they went down to a scorching free kick by Daniel Alves. And in the third place final they pushed European champions Spain into extra time before finally losing 3-2, again to a freekick.

They badly need more strike power and it looks like Santana must make peace with English-based striker Benni McCarthy who was dropped from the team for his apparent lack of commitment. But their performance gave grounds for some optimism.

Bafana Bafana's Confederations Cup performance was key to the 2010 World Cup because it will encourage local fan participation -- a constant worry for the organisers, who expressed concern before this tournament about lack of home enthusiasm.

Nevertheless, there are continuing worries that even the cheapest World Cup tickets are still too expensive for working class South Africans and that they will be unwilling to pay in advance for entrance in a year's time, something which goes directly against the entrenched local custom of buying tickets on match days.

World Cup matches attended predominantly by foreign fans and restrained, middle class South Africans would be a huge disappointment for the first World Cup held in Africa, where the unique local atmosphere was a major selling point.

That isn't the only worry in considering what the Confederations Cup tells us about the likely success of next year's much bigger global competition.

FIFA boss Sepp Blatter gave organisers 7.5 points out of 10 for the Confederations Cup but World Cup veterans said this was nothing to be complacent about, given his likely tendency to talk up the tournament. Even Blatter said South Africa had to do "a little bit more" and FIFA Secretary General Jerome Valcke was more direct, acknowledging problems with transport, security and accommodation capacity, which is still significantly below what will be required next year.

Security is a particularly sensitive issue, given South Africa's frightening reputation for violent crime, so it was unfortunate that the Confederations Cup saw alleged thefts from both Egyptian and Brazilian teams, although some of the circumstances remain mirky.

More serious were security lapses in access to stadiums and other areas. Such failures must be cleared up in the time that remains if fans are to follow their teams without constantly looking over their shoulders.

So the Confederations Cup provided both encouragement and warnings. Okay so far, but much more to be done. The next 12 months may be both nerve racking and frenetic for the organisers but we are all still hoping for a reasonably trouble-free football extravaganza with the special atmosphere that only Africa can give it--including those pesky vuvuzela trumpets...

PHOTO: A South African fan at the June 28 Confederations Cup final REUTERS/Dylan Martinez

June 30th, 2009

from MacroScope:

Why the BRICS like Africa

Posted by: Jeremy Gaunt

There is little doubt that the BRICs -- Brazil, Russia, India and China -- have become big players in Africa. According to Standard Bank of South Africa, BRIC trade with the continent has snowballed from just $16 billion in 2000 to $157 billion last year. That is a 33 percent compounded annual growth rate.

What is behind this? At one level, the BRICs, as they grow, are clearly recognising commercial and strategic opportunities in Africa. But Standard Bank reckons other, more individual, drivers are also at play.

In a new report, the bank looks at what each of the individual BRIC countries is trying to do. To whit:

-- Brazil's immediate intererest in Africa is securing access to natural resources, particularly oil. But is also motivated by a desire to create a new "Southern Axis" with itself at the forefront.

-- Russia is also interested in Africa's natural resources. But it faces a problem because of the sullied reputation of the Soviet Union during the Cold War. So Moscow has also embarked on a rebranding programme within the continent by ramping up its aid programmes.

-- India is attracted to Africa in part because of long historic ties. Commercial engagement, however, is also motivated by a need to guarantee the natural resources it needs for its own growth. Furthermore Africa is seen politically as a key ally in the pursuit of a competitive advantage over its Asian competitor China.

-- For China, Africa provides a long-term partner in its ongoing bid to gain global economic ascendancy, providing it with the resources, markets, geopolitical support, and, eventually, food and social security in the form of a growing and engaging diaspora.

A full copy of Standard Bank's report, which was written by Simon Freemantle and Jeremy Stevens, can be found here.

(Photo: Jeremy Gaunt)

June 29th, 2009

Mining and free trade in Eritrea

Posted by: Alison Williams

Eritrea’s President Isaias Afwerki has guarded his country jealousy since independence, pushing a self-reliant attitude that encourages Eritreans to rebuild Eritrea for themselves.

But in order to develop the potentially lucrative mining and trade sectors, he will have to open up the country more to foreign money and therefore possible foreign influence.

The government intends to launch free trade zones at its main ports in Massawa and Assab on its Red Sea coast, and dozens of firms, including from China, India and Dubai, have already registered to operate there to take advantage of the bustling cargo shipping lanes.

Reserves of gold, zinc and copper have been found in Eritrea and analysts are predicting a mining boom. Fourteen foreign firms are exploring in the country and the first project is expected to start producing gold by late 2010.

“We believe mining will play an important role in boosting the economy and the government is committed to develop it,” Alem Kibreab, director-general of mines, told Reuters Africa Journal.

The authorities want the sector to be developed slowly and carefully to prevent the so-called “resources curse”, where oil and minerals have spawned and corruption violence in Africa.

After the long struggle for independence from Ethiopia and subsequent border dispute, expectations for the development of the economy to support the population of 4 million are high - although Afwerki says the mining sector is no magic solution.

“Let’s not be misled that this gold is going to change everything and let’s not be relaxed,” he said. “Getting relaxed and trying to rely on, or at least anticipating to heavily rely on this resource may be crippling.”

(Photo: Eritrea’s President Isaias Afwerki listens to a question during an interview with Reuters in the capital Asmara. Reuters/Ho New)
June 28th, 2009

Overdose of trouble in West Africa

Posted by: Matthew Tostevin

That political stability is vital for investment and development goes without saying, but it seems as though too much instability can be bad for criminal enterprises too.

The cocaine cartels that used West Africa, and Guinea-Bissau in particular, as a conduit to Europe were long accused of worsening the chaos in one of the region’s poorest and most troubled states by buying off some factions of the security forces and political leaders.

But if so, things may have gone too far.

In less than a year, Guinea-Bissau has lost President Joao Bernardo “Nino” Vieira (dead), the head of the army (dead), the head of the navy (fled), a former defence minister (dead) and a candidate to replace the slain president in the June 28 election (dead). And those are just some of the figures at the top.

Whichever of Guinea-Bissau’s leaders might have been involved in the drugs trade and which were trying to fight it, the removal of such a swathe of the leadership appears for now at least to have knocked the traffickers off balance too.

Drug smuggling through West Africa has plummeted, according to the U.N., despite the fact that its geography also makes it an ideal bridge between Latin America and Europe.

“The fact that big traffickers do not any longer have certain partners in power clearly have disrupted the routes,” said Antonio Mazzitelli, regional head of the United Nations Office on Drugs and Crime. “A trafficker would never bring 2 tonnes of drugs to a country where he is not sure he can operate,” he told Reuters.

Political changes in Guinea, where a junta seized power after the death of President Lansana Conte, and Ghana, where the opposition won a democratic election, also appear to have limited their use as smuggling conduits for now.

An election in Guinea-Bissau now offers a chance for a new start. With greater international support its chance of becoming a failed state could have improved.

A question for the West African countries – and for the drug traffickers – may be whether administrations that become more entrenched over time will more easily fall prey to the lure of the drug money despite the dangers.

June 26th, 2009

Will Niger Delta amnesty work?

Posted by: Nick Tattersall

Nigerian President Umaru Yar’Adua has laid out the details of a 60-day amnesty programme for militants and criminals in the Niger Delta. Under the deal, all gunmen who lay down their weapons during a 60-day period ending in October will be immune from prosecution. The offer extends to those currently being prosecuted for militant-related activities, meaning Henry Okah – the suspected leader of the Movement for the Emancipation of the Niger Delta (MEND) – could also walk free if he agrees to renounce the notion of armed struggle.

Several factional leaders – including Ateke Tom, Farah Dagogo, Soboma George and Boyloaf – have said they accept the idea of amnesty in principle but want talks with President Yar’Adua to hammer out the details.

Advocates say such an amnesty would meet one of the key demands of militant groups and is the only way to bring an end to instability which costs Nigeria billions of dollars in lost oil revenues each year, prevents the development of the very communities the militants claim to represent and causes world energy prices to rise further, which ultimately falls back on the Nigerian consumer.

Critics say amnesty simply provides a get-out-of-jail free card to those responsible for kidnappings, acts of sabotage and banditry and that the promises to re-educate and reintegrate them into civilian society would require years of investment. The government has said it will not offer a “buy back” programme – money for surrendered weapons – but does the scheme reward those who have taken up the armed struggle while leaving peaceful protesters with nothing?

It is not the first time amnesty has been offered to armed gangs in the Niger Delta. Yar’Adua’s predecessor Olusegun Obasanjo struck such an agreement in 2004 with militants including Mujahid Dokubo-Asari, whose Niger Delta People’s Volunteer Force turned over thousands of weapons in return for amnesty. But the deal later broke down when some factions accused others of profiting from disarmament at their expense, and Asari was later arrested and charged with treason.

Is Yar’Adua’s amnesty offer a serious attempt at resolving the crisis in the Niger Delta or will it suffer the same fate as the previous amnesty deal? Is it simply an attempt to win political currency for the ruling party in the Niger Delta ahead of elections in 2011? What happens after the amnesty? What hope is there that the resources and political will are there to ensure the longer-term development of the Niger Delta and prevent a resurgence of the cycle of the frustration, unemployment and violence that has characterised the region for so long?

June 26th, 2009

War child sings songs of peace

Posted by: Alison Williams

“When you see a Sudanese walking on the street there is a story,” child soldier turned hip-hop star Emmanuel Jal says.

That’s certainly true for Jal. He was sent to fight for Sudan People’s Liberation Army when he was just six years old.

The exact dates are sketchy, but in about 1987, his village in southern Sudan was attacked by soldiers loyal to the Khartoum government, during more than two decades of north-south civil war.

His mother was killed and he was taken into the SPLA and taught to fire a rifle he was barely strong enough to hold. With the help of a British aid worker, he managed to escape to neighbouring Kenya and today is known for his music and messages of peace.

More than 20,000 child soldiers have been demobilised since the war that killed 2 million people ended in 2005.

His experience was turned into a documentary, “War Child”, which he went back to Kenya from his base in London to promote.

“Kenya is my home, this is where I became known as a rapper … so I’m bringing the movie home to see what had happened into the neighbouring country, for them to know why we are refugees here,” he told Reuters Africa Journal in Kenya.

His songs draw heavily on his history and that of Africa.

One, he told Africa Journal, is a letter to the oil, diamond and gold miners: “You take the riches and you leave the people poor.”

“I talk about when it comes to Africa the world don’t care,” he said.

Nairobi resident Moses Mbaja said: “Jal gave up his anger, he gave up his hatred and now he is creating peace; he is making peace. We should all embrace it.”

(Reuters Photo: Sudanese child soldiers guard rebel military headquarters in February 2000)

June 24th, 2009

from Environment:

New ‘gold rush’ buzz hits Germany over Sahara solar

Posted by: Erik Kirschbaum

A "gold-rush-like" buzz has spread across Germany in the last week over tentative plans to invest the staggering sum of 400 billion euros to harvest solar power in the Sahara for energy users across Europe and northern Africa. Even though European and Mediterranean Union leaders have been exploring and studying for several years the idea of using concentrated solar power (CSP), the Desertec proposition suddenly captivated the public's attention a week ago when German reinsurer Munich Re announced it had invited blue chip German companies such as Deutsche Bank, Siemens and several major utilities to a July 13 meeting on the project. The 20 companies aim to sign a memorandum of understanding to found the Desertec Industrial Initiative that could be supplying 15 percent of Europe's electricity in the decades ahead.

Germany's deputy foreign minister, Guenter Gloser, has been the government's point man for the project. I had the chance to talk to him about it.

Question: How did this project to turn the sun in the Sahara into electricity for Europe and north African countries get started?
Guenter Gloser: About 15 months ago Germany and France proposed including the solar plan into the list of projects for the Union for the Mediterranean. There were institutions that had already done research and we thought: 'Why don't we use this sun belt where there is such an abundance of sunshine as a source of renewable energy?' Together Germany, France and Egypt put forth this solar plan as one of the six projects for the Euro-Mediterranean Partnership and underscored the fact that it could benefit both sides. It was not an idea where just countries north of the Mediterranean will benefit but rather those countries south of it as well as across the EU would also benefit.

Question: What is the current status of the project?
Gloser
: We agreed to move forward with the project and want to go forward step-by-step towards its implementation. But obviously neither the EU nor the Arab League will be the principal players but rather private investors. Our task for this project is to create the political framework -- for example with setting up of the feed-in tariffs, ensuring the infrastructure is built and ensuring that the renewable energy can be transported to Europe. The political framework can also make it possible to expedite the approvals process. But what is also very important is that the energy produced is also available for countries in the region. For example, Morocco can take advantage of its solar and wind conditions on the Atlantic coast to build solar power plants or wind energy parks to provide energy for its domestic market and to sell energy abroad as well. Even countries such as Algeria, which has fossil fuel reserves, could also use the sun belt for solar thermal power for some of their energy needs -- and prolong their fossil fuel reserves.

Question: Is there not risk involved in such large-scale investment in a region with a potential for political instability?
Gloser:
It's a cooperation that will contribute towards diversifying energy sources, geographically and in terms of energy sources. It's a truly fascinating project because it's a win-win for everyone. And the third winner will be the people and institutions that finance this project. Neither the EU nor the countries in the south are capable of financing this on their own. So the question is: can third-parties bringing financing be involved. Energy security is an important issue everywhere. There are energy sources we have today that at times have been somewhat at risk. There's no contradiction in saying that it's important to diversify a country's energy source as well as diversifying the types of energy it receives. It's not that there is no risk whatsoever but it's important to keep in mind that there are also some risk factors for other sources of energy that we are now importing.

Question: What impact do you think a project like this could have in the Mediterranean Union?
Gloser:
I think the partnership approach that we have taken could well have a positive influence of stability for the countries taking part as well as the neighbouring nations. The EU has been enlarged and come closer together in the past decades but there hasn't been as much of that among Arab countries. Perhaps it would be possible through certain projects, such as this solar energy project or water projects or transportation routes, to increase the cooperation among those countries.

Question: There have been fears expressed that Europe would be exploiting natural resources in Africa, raising fears of a new sort of 'colonisation'. What would you say to those fears?
Gloser:
It is not in any way an issue of the north dominating the south. It is not only the north that is interested in acquiring renewable energy but rather other users are interested. And if that mutual need for energy leads to a project that satisfies all sides then that is in my view a good route to take. I don't think there's any justification for the notion of this being an 'energy colonisation' or anything like that at all. It's a mutually beneficial project."

Question: How high is the interest in other countries? Some cynics would say Germany's expertise in renewable energies gives it a big advantage.
Gloser:
So far the countries in the south and north have been in agreement about the project. Now the task is to identify the next steps. There are countries in both the south and north that are more interested in the project than others -- because, for example, they already have had positive experiences with renewable energy. That is not only Germany but also Spain and other countries. And on the other side of the Mediterranean there are countries that will have more interest at first than others.

Question: Some might see this project somewhat cynically as a vehicle to help German companies that already have such a considerable head start in know-how with renewable energy. What would you say to them?
Gloser:
Obviously there are some important players (in Germany). But they are not only in Germany. Certainly we have built up a renewable energy sector in Germany, thanks to the right political framework a decade ago, that has created an enormous number of jobs. But Spain has also had an enormous development in recent years and in Denmark the wind energy sector has reached a large dimension with considerable know-how. But beyond those countries there are many other countries with companies and suppliers for the industry.

Question: Are there problems on the horizon being overlooked?
Gloser:
In my eyes the biggest problem right now is that the expectations have possibly been raised too high. I'm someone who's thought: that's a great idea and why don't we take advantage of all these things at hand: know-how, sun belt, political cooperation, development, stability, security, partnership. There are so many positive aspects that come together. Now it's time to come up with some realistic timetables and see how we can move forward step-by-step to make this project a reality.

PHOTO: Mirrors are seen channelling sunlight onto a tube filled with oil during the dedication of Acciona's Nevada Solar One power plant in Boulder City, southeast of Las Vegas February 22, 2008. The 400-acre, 64-megawatt, concentrating solar power (CSP) plant is the third largest in the world, according to Acciona. The plant produces energy to power about 14,000 homes. REUTERS/Las Vegas Sun/Steve Marcus

June 24th, 2009

Are Nigerian banks set to boom?

Posted by: Ed Cropley

Few investors dispute the view that Nigeria’s banks look
cheap at the moment, with most of the major players trading at a
discount to book value and with earnings multiples way below
consumer stocks such as Guinness Nigeria.
 
Nor is anybody arguing against the long-term logic of the
financial sector’s potential growth in an oil-rich country of
140 million people but only 23 million bank accounts.
 
A new central bank head with a background in risk management
is also making all the right noises about improving the sector’s
notoriously murky financial disclosure - part of the reason the
shares crashed so spectacularly in the latter half of 2008.
 
Furthermore, Lamido Sanusi’s stated desire to relax limits
on foreign ownership has breathed new life into the view that
another wave of consolidation, this time involving major global
players, sits around the corner.
 
Does all this sound - like so many other Nigerian promises of easy money - too good to be true,
or are its banks set on a long-term trajectory that will ultimately see them realise the dream of making Lagos a financial hub to rival Johannesburg?

June 24th, 2009

Money will talk louder than any vuvuzela

Posted by: Mark Gleeson

The debate around the vuvuzela was always going to generate big noise but for some South African commentators it has become almost a neo-colonial conflict.

The noisy trumpet, which dominates the sound waves around the stadiums during the Confederations Cup, has got a lot of people covering their ears.

Complaints from TV viewers across Europe have been vociferous enough for the future of the plastic pest to become the major item on the agenda at the series of press conferences FIFA president Sepp Blatter has held during the tournament in South Africa.

Blatter has said it will stay — he wants to celebrate local custom and is inviting the rest of the world to do so too.

 

 

 

 

 

 

 

 

 

 

 

FIFA’s television arm, HBS, are more cautious but say privately, at the end of the day what Blatter says goes.

The European TV stations, who pay a lot of the money that funds FIFA, Blatter and the World Cup, could have the vuvuzela banned if they bleated enough. But most of the noise, so far, has come from enraged South Africa columnists, who have rounded on the poor Dutch journalist who first sought Blatter’s response to complaints from European television viewers.

In Africa, there is a sensitivity to being told what to do from outside and a pride in seeking to create a unique World Cup in 2010. Some of the stuff written though has been a little churlish. See here, here and here for a flavour.

At the end the day, it is the big TV money that talks. If the world’s broadcasters feel the cacophony of vuvuzelas detracts from the viewing pleasure of their public, FIFA will be forced to back down and ban the trumpets from the 2010 World Cup stadiums.

It won’t have anything to do with any ‘ism, just cold hard cash.

  • Yes…they are annoying
  • No…they add to the mood of the game
  • Who cares?