The Missing Mobile, pt. 2 – Africa’s Smartphone Revolution

Posted on by

Last week we wrote about Africa’s current bandwidth shortage and the emerging telecom investments changing the tide in which technologies are being used. This week, the Wall Street Journal (WSJ) published a review of 2010’s top trends in mobile technology. Two major predictions for 2011 stand out in the African context: “Cheap smartphones” and “Apps go corporate.”

WSJ anticipates that Google will target expand the smartphone market by heading downmarket with Android, its operating system for mobile devices. Chinese companies Huawei Technologies and ZTE (Google and China censorship spat notwithstanding) are making just the kind of less expensive models African consumers seek. Although the African market may average a $10-$15 dollar handset price point, new Chinese smartphone models can be sold to end users for as little as $50. Unsubsidized, says WSJ, Android phones will sell at prices below $100. Profits may make strange bedfellows and together Google and Huawei may spark fast-moving growth in Africa’s smartphone market.

Continue reading →

Developing African Commodities Exchanges

Posted on by

Most African countries are highly dependent on the exports of a few primary commodities. Historically this dependency has rendered them extremely vulnerable to volatility in world prices, but increasingly erratic weather patterns caused by climate change are exacerbating the problem.

A good example is the recent surge in wheat prices caused by the drought in Russia, the world’s largest wheat exporter. The price rise – as much as 92% since the beginning of June – is the result not just of a Russian ban on wheat exports, but also speculators’ purchase of as much as 400% of available supplies. While US consumers may see a modest rise in the price of wheat-based products, consumers are protected from sharper increases because US farmers sold their wheat in advance of the harvest at a guaranteed price considerably lower than the current price. A price spike in Africa, which does not have access to global exchanges and similar risk-mitigating tools, could generate a food crisis similar to the one experienced in 2008 when wheat futures reached record prices.

Climate change is expected to disproportionately affect Africa’s farmers because poverty and underdevelopment make it harder for them to adapt quickly to changing weather patterns. These challenges are compounded by the fact that unlike American or European farmers, Africa’s farmers have only limited access to effective commodities exchanges, which can provide the kinds of contracts necessary to offset risks and help plan for the future. These limitations expose farmers to unreasonable risk, severely hampering their competitiveness in the global market and rendering Africa highly vulnerable to food shortages.

Continue reading →

The Meaning of Our Commitments: Maternal Health and MDG 5

Posted on by

African heads of state recently met for the 15th African Union (AU) Summit in Kampala, Uganda. One major theme of this year’s summit—maternal health— is both timely and contentious.  New research on maternal death figures is stirring debate globally and the topic will feature prominently at September’s United Nations Millennium Development Goals Summit.

Continue reading →

Leadership on Maternal Health at the African Union Summit

Posted on by

At this week’s AU Summit in Kampala, the Heads of State spoke about maternal and child health during the plenary session, reflecting the theme of the 15th Summit, which was “Maternal, Infant and Child Health and Development in Africa.”  I was particularly impressed by Ethiopian Prime Minister Meles Zenawi’s comments on the subject.  He began by urging partners to put “their money where their mouth is” and expand resources to reach the health-related Millennium Development Goals.  He pointed out that there is an unfair distribution of limited health resources, and that women get “the short end of the stick.”  He suggested that in order to improve maternal and child health, countries should focus on strengthening primary health systems and sponsoring interventions with a “big bang for the buck.”  Continue reading →

Innovation in Kenya

Posted on by

On a recent trip to Nairobi, I was thrilled to have the opportunity to meet with both Equity Bank and M-PESA at Safaricom.  M-PESA and Equity Bank are prime examples of companies involved in a new trend in innovation.  A recent Economist report on innovation in emerging markets explains that “many of the most important innovations…are aimed at the middle or the bottom of the income pyramid.” Continue reading →

Coordination, not Competition, in Aid

Posted on by

By Meg Dallett

One of the biggest problems with aid effectiveness is that it has often been planned and distributed according to what donors think the developing world needs, rather than what developing nations say they need.  This has led to, at the largest level, huge amounts of wasted funds, and at the smallest level, the recent misconceived project to send a million t-shirts to Africa.  Smart aid requires local ownership, not just in implementing projects but also in deciding what is most needed in the first place. Continue reading →

Harnessing the Brain Drain: Potential for Development

Posted on by

By Isaiah Schulze

In discussions of African development issues, the subject of “brain drain” is often brought up. The basic thesis is that by immigrating to developed countries, highly talented Africans are depriving their home nations of the intellectual assets needed for development. Rich countries gain unfairly from this phenomenon as they retain the academic, political, and economic contributions of these skilled individuals, while African countries languish from a shortage of good ideas. Continue reading →

Maximizing Capital Flows to Africa: Some brief comments on sovereign bonds, hedging instruments, private equity and carbon finance

Posted on by

More African countries than ever have entered the international financial system through the international bond market in 2009/10. Whereas before only countries like South Africa had credit ratings sufficient to enter, now places like Tanzania and Togo are considering how best to enter. Continue reading →

Moving Forward into AGOA’s Second Decade

Posted on by

This week TWG helped to organize and to co-host two back-to-back events that brought together an amazing coalition of people from Africa, the US and beyond to plan the strategy for AGOA as it moves forward into its second decade, and to discuss ways to maximize capital flows to Africa and give the African Diaspora vehicles to use remittances to invest in Africa’s development. Continue reading →

How Not to Use Trade Preferences

Posted on by

By Patrick Costello

The report on trade preference programs recently released by the Center for Global Development, while making a number of sound recommendations for reforming and harmonizing the myriad of preference programs extended to the developing world from “rich countries,” contains several points that would be harmful to nations benefiting from the African Growth and Opportunity Act (AGOA). Continue reading →

China and Africa: The Rise of Special Economic Zones

Posted on by

by Isaiah Schulze

Although the rise of China is axiomatic, the extent of China’s influence on other developing countries is still being debated. China’s experience in Africa has caused much controversy. Many accuse Beijing of propping up corrupt governments by offering “no-strings attached” loans, stealing employment from locals, and degrading the environment. Although there is definite merit to these criticisms, it is unfair for the West to focus exclusively on China’s wrongdoings. As David Piling in the Financial Times asserts, “China is no philanthropist, but its rise may represent Africa’s best hope of escaping poverty.” Continue reading →

Create Jobs in Africa, and All Else Will Follow

Posted on by

Published at allAfrica.com – Trade Talk with Rosa Whitaker
by Rosa Whitaker

Bill Gates’ commitment at the World Economic Forum in Davos, Switzerland, to give $10 billion over the next decade to develop and distribute vaccines to children in the world’s poorest countries has stimulated an interesting discussion on what would be the best use for such a large charitable gift. It’s an important discussion too, as more very wealthy entrepreneurs use their charitable giving to change the whole paradigm of aid to the “bottom billion.” Continue reading →

African Diplomacy in an Era of “Messy Multilateralism”

Posted on by

The era of “messy multilateralism,” as Richard Haass, President of the Council on Foreign Relations, recently wrote in a Financial Times op Ed, has spawned new and more international forums, like the Major Economies Forum, Davos and Committee of the Parties. The more forums there are, the larger and more complex the portfolios of Foreign Service officers (FSOs) working in major cities like Geneva, Washington and New York become. Continue reading →

Africa in 2010

Posted on by

by Margot Bokanga

One important question the business and development sectors and policymakers in Africa and the international community may be asking is “How will Africa perform this year and this decade?” Despite last year’s global recession, Africa remained the most profitable emerging market to invest in, and this year it offers strong business opportunities to many investors. Looking through the Top 9 Business Stories of 2009 that I posted last week, I found three trends. Continue reading →

Africa’s Top 9 Business Stories of 2009

Posted on by

by Margot Bokanga

1.  Telecommunications remained one of the fastest growing sectors in emerging markets last year, with African mobile phone use increasing more rapidly than anywhere else in the world.

2.  The East African Community emerged as the most evolving regional trade bloc on the continent, with major agreements and accomplishments achieved in 2009.

3.  African banks survived the global economic crisis by continuing to attract investment from across the continent and even from Asia with prudent lending and investment policies.

4.  Despite the global economic crisis, African economies continued to attract foreign investors like CDC Group who saw the continent’s impressive return on investment and potential for high rewards. 

5.  The Aid Trap, a unique approach to development written by Glenn Hubbard and William Duggan, proposed that the US government make direct loans to businesses in the developing world and encouraged investment in infrastructure.

6.  South-South trade and investment – particularly exports from Asia to Africa – tripled in the last five years, making Asia Africa’s third largest trading partner (27% of trade) after the EU (32%) and the US (29%).

7.  At the Copenhagen climate change conference in December, Africa emerged as a powerful bloc when the continent staged a successful, unified walkout to prevent African interests from falling by the wayside.

8.  While oil and mining has often been the main area for investment in Africa, in 2009 Africa offered new opportunities – particularly in the construction of undersea cables.

9.  The World Bank’s Doing Business 2010 report noted that the business environment is continuing to improve in key countries on the continent: in particular, Rwanda was ranked the world’s top business reformer and Mauritius became the first African country to break into the top 20 countries to do business.

Delaying the Trade Preference Reform Debate

Posted on by

By Patrick Costello

As 2009 comes to a close, Congress is poised to pass a one-year extension for the Generalized System of Preferences (GSP) and the Andean Trade Preference Act (ATPA), both of which are set to expire on December 31, 2009. Despite rhetoric calling for reform from Senate Finance Committee Republican leadership, a full-day Congressional hearing on the issue, and the introduction of legislation harmonizing preference programs and extending benefits to non-African LDCs, Congress has decided to pitch the reform discussion to next year. Continue reading →

Investment: The Next Area for African Cooperation

Posted on by

By Meg Dallett

Earlier this year, I wrote about the lack of African foreign investment in Africa and how crucial intra-Africa FDI is for the continent’s long-term development.  With the developing world’s highest rate of return on investment and plenty of room for new projects, Africa should be an obvious choice for African investments.  But in 2008 UNCTAD reported that intra-African investment made up only about 13% of all investment in Africa. Continue reading →