Wednesday, 19 November 2008
Thursday, 23 October 2008
Monday, 20 October 2008
Thursday, 9 October 2008
The World Economic Forum’s Global Competitiveness Report, released on the 8th October adds to the picture of an improving climate for business in Africa. In sub-Saharan Africa, South Africa (45), Botswana (56) and Mauritius (57) feature in the top half of the rankings, with several countries from the region measurably improving their competitiveness. Côte d’Ivoire (110), Ghana (102) and Malawi (119) join this year’s ranking for the first time.
The United States tops the rankings, followed by Switzerland, Denmark, Sweden and Singapore.
The United States tops the rankings, followed by Switzerland, Denmark, Sweden and Singapore.
The survey is designed to capture a broad range of factors affecting an economy’s business climate. The report also includes comprehensive listings of the main strengths and weaknesses of countries, making it possible to identify key priorities for policy reform.
Friday, 26 September 2008
A favourable investment climate is vital for economic development and African policy-makers recognise that obstacles to both domestic and international investment are seriously impeding Africa’s development.
This event, chaired by Bert Koenders, Minister for Development Cooperation of the Netherlands, served as an opportunity for heads of African governments and business leaders to explore and discuss how the business and investment climate can be improved through effective public-private cooperation frameworks.
Amir Dossal, Executive Director, UN Office for Partnerships, noted that encouraging regional growth is threatened by rising food and oil prices and instability in financial markets. At a time of global economic insecurity, Africa needed a healthy and robust private sector to help maintain productive economies and to generate greater levels of investment, trade and job creation.
Bert Koenders, Minister for Development Cooperation of the Netherlands, when framing the discussion, pointed out that business needs predictability, stability and an efficient regulatory and legal infrastructure to thrive, in addition to more regionally integrated trade infrastructure.
Comments from speakers focused around five themes:
I) Business has an important potential role to play in tackling poverty and accelerating progress towards the MDGs
Jeffrey Sturchio, Chair of Business Action for Africa noted that it is increasingly recognised that the most powerful contribution that the private sector can make to development is to do business responsibly and successfully through core business activities: through products and services, and the opportunities created for employees, suppliers, distributors, and local communities. A tangible illustration of this point is provided by data that shows Foreign Direct Investment to developing countries reaching a record $536 bn in 2007, 20% up on 2006 – compared to total Foreign Assistance by donors declining by 8.4 % to $103 bn in the same year.
II) Getting the investment and business climate right is key priority
In addition to creating strong and transparent governance standards, the need to streamline complex business regulation, accelerate regional trade integration and improve physical infrastructure were also identified as key drivers for development by Louis Michel, European Commissioner for Development and Humanitarian Aid.
A number of success stories were cited by Omari Issa, Chief Executive of the ICF, demonstrating that progress is being made. For example, as a result of work undertaken by ICF to improve efficiency and reduce the cost of doing business, it is now possible to register a business in Rwanda in 48 hrs – it had previously taken considerably longer. In addition, to make it easier to access finance in Rwanda, Burkina Faso and Sierra Leone, ICF is working to introduce land registration procedures to enable owners to use their land as collateral. ICF has also established programmes to help improve the efficiency of business legal procedures in Zambia and Tanzania, to improve customs administration in East Africa and Senegal, and also to help tackle counterfeiting and piracy.
III) Investors are responding to concerted reforms and innovative problem solving approaches
During the session, examples of successful partnership based projects and the growing attractiveness of the region for investors included Seacom, a venture that involves the laying of a new fibre optic cable that will deliver significant increases in broadband internet capacity to the region (up to 50% increased capacity). Bruce Wrobel of Sithe Global Power pointed to the fact that the project took only 12 months to go from concept to finance, with a further 18 months to implementation, with cable laying starting in June 2009.
Another example of a successful partnership based approach is the manufacturing of mosquito nets in Tanzania, provided by Hiromasa Yoneura, President and CEO of Sumitomo Chemicals. As a result of bringing together government support, local entrepreneurial flair and innovative cutting-edge technology, 10 million nets / year are currently being manufactured, which has also created jobs for 3,200 local people. The project will expand to 19 million nets / year by the end of 2008.
IV) Small scale business and agriculture key priorities
It was noted that the private sector in Africa is largely made up of small scale businesses, largely operating in the agricultural sector. Amos Namanga Ngoni, President of the Alliance for a Green Revolution in Africa, identified increasing agricultural productivity as key to poverty reduction and ensuring food security. Currently, despite the fact that 70% of the population is in the agricultural sector, only 4% of government budgets and 4% of Official Development Assistance is channeled in to supporting agriculture. There is a need for governments and the private sector to collaborate to encourage greater investment in improving agricultural productivity, through greater access to fertilizers and pesticides, in addition to providing more inclusive financial services to help farmers mitigate against the risk of uncertain weather patterns and access financing.
V) Partnerships offer the best way to make progress
It was noted that given the scale of the challenges, the need for collective action through public private partnership approaches was critical. The growing number and variety of partnerships – in areas as diverse as governance reform, water sustainability, agricultural productivity and human development and healthcare - demonstrate that it is increasingly possible to deliver successful economic and development outcomes.
Wednesday, 10 September 2008
These countries should be congratulated and encouraged to renew their efforts in making their countries easier places to do business – for companies large and small.
The report tells us that Africa had a record breaking year for regulatory reforms that make it easier for companies to do business. 28 countries completed 58 business-friendly reforms and three of the world’s top 10 reformers of business regulations are in Africa this year: Senegal, Burkina Faso, and Botswana.
Senegal made it easier to start a business, register property, and trade across borders.
Burkina Faso introduced a new labor code and reforms for registering property, dealing with construction permits, and paying taxes.
Botswana cut the time to start a business, facilitated trade, and strengthened investor protections. Postconflict countries, Liberia and Sierra Leone, along with Rwanda, were among the regions’ most active reformers of business regulations.
Mauritius moved up to 24 in the global rankings on the regulatory ease of doing business and continues to provide inspiration for reform and good practices to other economies across Africa. The runner-up in these overall rankings is South Africa at 32, followed by Botswana at 38.
Accelerating regulatory reform, alongside improvements to the overall investment climate and governance standards show us that Africa is laying the foundations to ensure that economic growth can be both sustained and more widely shared.
Friday, 1 August 2008
Business Action for Africa, an international network of over 200 businesses, business organisations and development partners, calls on global leaders, in business and in government alike, to respond to the collapse of world trade talks this week by urgently looking for pragmatic ways forward to reduce barriers to trade and to stimulate global growth and development.
As businesses operating across Africa, we know that Africa will not achieve the Millennium Development Goals to halve world poverty by 2015 if it is not allowed to increase its trade with the rest of the world. Global leaders and the WTO must act urgently to show that there is still a multilateral way forward which can deliver results quickly for the whole world economy and especially Africa.
As we know, huge progress was made in the last six years, and in the last six days of the talks. So, rather than give up all this progress for two years or more, let us implement as much as possible as soon as possible:
1. Implement the 2005 Hong Kong agreement, by developed countries and larger developing countries in a position to do so, to provide completely free market access for all products from the world’s 50 Least Developed Countries (LDCs), of which 32 are in Africa.
2. Richer countries should honour their commitment to do this by 2008 and not enforce their right to wait for the rest of the Doha agreement. This should include the commitment to simplify rules of origin to make trade easier. Developed countries should apply this to 100 per cent of exports from LDCs and waive the 3 per cent exemption negotiated in 2005, which cuts the benefits of this agreement to LDCs from $7bn a year to $1bn a year.
3. Complete the negotiations on Trade Facilitation, which is within reach. This would make all trade easier, benefiting all countries, including at the intra-regional level, and, unusually, comes with guaranteed assistance for developing countries from developed ones. The OECD estimates that by reducing export time by 4.5 days for Sub-Saharan Africa could increase exports to OECD countries by 10 per cent. Trade facilitation, alongside investment climate reform, is a key way to stimulate business investment – a key driver of growth and poverty reduction.
4. The WTO should continue through the agreements achieved so far in a ‘progressive multilateral undertaking’ to reduce trade barriers, where possible, in agriculture, manufactured goods, services and rules.
As the global economy starts to falter and progress towards the MDGs is under threat, now is not the time to take a break. It is time for hard work and hard decisions.
Joint statement issued by the following organisations, in their capacity as board members of Business Action for Africa:
De Beers Group
International Business Leaders Forum
This grew out of a request by WBCSD member companies to develop a measurement framework that could underpin the license to operate, improve the quality of stakeholder engagement, help manage risks more effectively and identify ways to enhance the business contribution to society. Companies like Unilever, Vodafone and Anglo American, who had recently completed their own measurement tools or studies, were eager to explore common threads across sectors and build a common approach to measurement that would enhance the discussions on business impacts and role in society.
The resulting Measuring Impact Framework is designed to help companies understand their contribution to society and use this understanding to inform their operational and long-term investment decisions and have better-informed conversations with stakeholders.
The Framework includes 3 components: (1) the business case for measuring impacts entitled “Beyond the bottom line”, highlighting the experience of several WBCSD member companies; (2) a four-step methodology to identify, measure, assess, and manage impacts; (3) an Excel-based user guide that helps companies carry out an assessment.
Key features of the Framework:
- Built by business for business – reflects the collaborative work of over 25 multinational companies over a 2-year period;
- Grounded in what business does – based around activities and processes that companies do every day;
- Moves beyond compliance – attempts to answer questions about what business contributes beyond traditional reporting;
- Encourages stakeholder engagement – supports open dialogue with stakeholders to create a shared understanding of business impacts and societal needs, and to explore what business can and cannot do to address these needs;
- Flexible - designed for any business and/or industry at any stage in its business cycle, operating anywhere in the world
- Complements existing tools – makes use of what is already out there (for example, the Global Reporting Initiative and International Finance Corporation (IFC) Performance Standards);
- Externally reviewed – reviewed by more than 15 stakeholders, ranging from non-governmental organizations to academia and government, including Oxfam, World Resources Institute, International Finance Corporation and Harvard University. The Framework is co-branded by the IFC who is currently deploying it with one of their private sector clients.
To access the Measuring Impact Framework (including the business case brief, methodology and user guide): http://www.wbcsd.org/web/measuringimpact.htm
The WBCSD and Business Action for Africa are currently exploring opportunities with their respective member companies to apply the Framework in Africa
For more information about the Framework, please contact: Jessica Davis
Tuesday, 6 May 2008
Last July, in a speech at the UN, the UK Prime Minister Gordon Brown called for a new global partnership to deal with what is a development emergency: the shortfall in progress in meeting the Millennium Development Goals, particularly in sub-Saharan Africa. The PM and the UN Secretary General, Ban Ki-Moon, have both made clear this is a global Call to Action which cannot be achieved by governments alone, and where the private sector has a unique role. The speech was accompanied by two statements, one by Heads of State and the other by business
The Business Call to Action Website, includes more on the event and the MDG Call to Action, speeches, a live blog from the event, video, films and photos.
I believe the event is significant for two reasons. First, it showcases the important contribution that businesses can make through their core business. The event will look at new business ideas and initiatives which go beyond philanthropy, and that will support economic growth and reduce poverty in developing countries.
Numerous other examples of this sort of good practice are highlighted by Business Action for Africa and showcased on our Google Map. The second reason that the event is important is that it implicitly recognises that growth, enterprise and employment are the only long-term solutions to poverty.
If you are interested in fighting poverty through business, I would urge you to join Business Fights Poverty – a professional network of experts and practitioners from around the world that we have just set up. The Business Call to Action event is the start of a long journey - it will take a movement of like-minded people, not just an event, to make the difference that is needed.
Friday, 4 April 2008
This is a remarkable achievement, and should be celebrated and learnt from. It is not a coincidence the Ghana also recently won recognition for being among the 10 fastest reforming countries in Africa in terms of the ease of doing business. It was also the first country to submit itself for review under the African Peer Review Mechanism – the Africa-led process for driving good governance.
But much remains to be done, not least the high level of poverty and social exclusion in the three northern regions of the country (poverty reduction has been more significant in cocoa producing regions). The challenge is to ensure all of Ghana’s people are able to participate in and benefit from the opportunities that growth brings.
Wednesday, 2 April 2008
He also recognised the important role that the private sector has to play in helping developing countries grow and fight poverty – investing, creating jobs and increasing poor people’s access to affordable goods and services.
The words are a breadth of fresh air, and the task now is to ensure that they are reflected right across DFID – its priorities, programmes and structures – as well as across the development community as a whole.
My full blog is posted on Business Fights Poverty, the new professional network for those passionate about fighting poverty through good business.
Friday, 28 March 2008
A local entrepreneur of rural origin and with limited previous business experience (second hand cloth imports), has used collaboration with the traditional leaders and bigger farmers as a solution to common problems, such as: technological innovation being undermined by superstitions, lack of cash and access to agricultural inputs among rural dwellers, insecurity of loan repayments and cash transfers, speculative competition. The company has rapidly increased its turnover, profit and is now borrowing commercially to expand its production into new regions.
At the same time, a similarly structured agricultural scheme led by highly trained financial experts and a multinational food company failed to ensure small holders’ productivity increases and loyalty. The company moved to commercial block farming where, while still struggling to make good commercial returns, the impact on the community and poverty is much lower and more limited.
I highlight these and other examples from Malawi and elsewhere in a recent essay. My argument, informed also by my work at Emerging Markets Group, is that big multinational companies and many donors / foundations, have been too focused on working through formal systems that may not work well in Africa. There has been a consistent attempt to try to make African ‘capitalism’ more like in the West rather than adapt to the potential of the indigenous traditional systems. This has led to lowered ability to solve inherent problems and has led to a resistance to invest in commercially fertile grounds.
Wednesday, 12 March 2008
I know. I said that we in Africa are staying disconnected from the world. But that is just part of the story. Yes, we struggle to stay connected but don’t give us half a chance or we will rule the world. Once we get off World of Warcraft or Facebook. Boy are you lucky we don’t use that too often. Imagine people who like being connected to each other having the opportunity to do social networking while in different places! World here we come! I wonder if we will ever get off the Internet and still live and interact with each other if we were given that opportunity? Thank god for staying disconnected - it allows us to stay connected.
But I have two other stories about us and our version of web 2.0 to tell you about. The first one starts in Zimbabwe…
Yes. Zimbabwe. The country that is going through hell at the moment. And it has been going on for the last few years. But give someone a mobile phone and see us fly. OneWord Africa (one of my favourite sites - hidden agenda, I worked with them for a while a few years back. Hi Patricia!) reported on how people are using mobile phones to go hi-tech in campaigning for the upcoming election. It is not that easy to campaign in Zimbabwe at the moment. Crazy Uncle Bob isn’t what he used to be. Democracy isn’t what it used to be in Zimbabwe. He isn’t allowing much freedom for people to campaign for anyone other than him. And he instigates violence and riots against the opposition. So what are people to do?
Well. He made the mistake of allowing people to have mobile phone. And when you have some water and sand… We campaign. The people in Zimbabwe text each other left, right and centre to get the message across. But not just personal messages. No way. They do it African style. In a way to make sure people know where it comes from and who they all support. A group with no place to meet - but a group none the less. They text a message that identifies them as a supporter of a specific party or person. A simple “Vote for Simba” to highlight support for Makoni and a longer “Have you not suffered enough? Morgan is the solution” for Tsvangirai’s faithful. Simple, but beautiful and genius. Bob - you control the radio, television and newspapers, but you can’t control the keypads.
But they don’t stop there. No way. They go further. Ring-tones. Here it is more about opposition to Crazy Uncle Bob than support for an individual. The opposition play a local song, which asks in Shona: “How long will you vote for ZANU-PF?“. Pure genius. People phone you and others hear. One snag. Run when the phone rings and you are close to the police! Pure genius for keeping democracy alive though. I almost gave up hope on Zimbabwe, but the people proved me wrong again. And I like being wrong in cases like this.
My other story comes from one that was told to me by Martin Feinstein a few years back. He used to run Proudly South African, but now runs Enablis that tries to help entrepreneurs use the Internet to enhance their business - and support them financially and with management support. (I can’t vouch for them. They have good methodology, but I don’t know how effective they are. Just haven’t been keeping an eye on them. So this is not a plug for them.) He was telling me about this guy in Soweto who found a brilliant business idea - a pure win-win (almost). And all he needed was a computer and a shipping container for an office and storage. His plan? So simple. He used to go to one of the markets every single day to buy his stuff. And there were hundred, if not thousands, of women selling their goods. But they closed every single Monday to go to the wholesaler to buy their stuff they sell. They all got into the taxi’s and travelled into the city to buy their goods.
And what a loss for their business. No discount because they bought little amounts at a time. Loss of business for the day they were closed. And money for their travels. And the wholesale had to deal with so many people at the same time. His idea? Why not get them to place their order with him and he logs it into the computer and sends one order (with separate packaging) to the wholesaler. The wholesaler then delivers because it is a huge order and gives him 15% discount for the large order. That is his cut - the 15%. The women didn’t pay anything more than the usual and actually saved because they didn’t have to pay the taxi. And they were open on Monday’s for an extra day of business. Genius isn’t it? Everyone won. Okay - the taxi guys lost out, but less sympathy there with their driving skills… The plan was not rocket science, but still genius by the guy to see the opportunity. (Sorry - never got his name.) And what did he want from Martin and them? Just help to get a container and a computer. Less than $2,000 and bam you have a highly profitable business. I love that story - it tells us so much about the entrepreneurs hiding away all over Africa.
Okay, so it is not the typical web 2.0. But we are not “typical” in Africa either. We take technology and turn it into something that helps us make our society better - and ourselves better. The fastest growing mobile phone users in the world? USA? UK? Maybe India or China? Try Africa. We have few landlines. No problem - we’ll go wireless. Yes, we are disconnected from the world. But we are so connected between the ears.
from Angry African on the Loose
Friday, 29 February 2008
Companies who ten years ago took a long-term view of investing in Africa are now reaping the benefits. Celtel for example has experienced extraordinary growth in the mobile telephony market, and has recently been involved in setting up Satya Capital to invest in other business opportunities on the continent.
And it is not just one sector that is showing high potential, but expectations of growth are predicted in the hotel industry, the power sector, infrastructure and construction, mining and financial services. It is not just big business either – SMEs growth is also ready to explode.
Amidst all this possibility, what about the bouts of political instability that we cannot deny occur? Kenya being the most recent example which is currently experiencing an economic downturn as a consequence of the violence. The delegates I enquired of at the conference all concurred – it was anticipated to only be a short-term fall (with today's news a sign of real hope).
The future for Africa is considered bright and it is the long-term view that the conference delegates considered all important for the continent.
Thursday, 14 February 2008
While it is unusual for Her Majesty’s Government to issue Valentine’s Day messages, this one is particularly heart warming as it debunks a whole set of myths that environmental campaign organisations have been peddling to the British public.
As I’ve argued before, there is a lot of nonsense spoken about “food miles”, with campaign groups arguing against buying Kenyan flowers because of the impact that flying them into the UK has on the environment. As the DFID statement says, “It’s important to remember that flowers flown in from Kenya aren’t grown in heated greenhouses so they use less energy than most of those produced in Europe."
Aside from exposing the environmental claims, DFID’s research also highlights the huge importance of the flower trade to Kenya and its workers:
“Kenya is the lead exporter into the European Union of cut flowers, and the world's largest producer of roses. International demand for Kenyan flowers accounts for almost 10% of the total income it receives from exports. By meeting demand for roses used on 14 February, exporters earn more than from the rest of the year's sales combined. Between 40,000 and 70,000, about 75% of them women, are employed on Kenyan flower farms, and indirectly 1.5 million are employed.”Buying products from Africa is a way in which everyone can make a direct and sustainable contribution to poverty reduction in Africa. In a statement last year, Business Action for Africa, welcomed the boom in fair trade, but called for the world trading arrangements to be made fair too. African’s don’t want charity, they want a fair opportunity to grow their business and trade their way out of poverty. By highlighting that, the DFID Valentine’s message is a welcome one.
Thursday, 7 February 2008
But in the world of corporate social responsibility (CSR), it is precisely this reliance on the simple story that is now holding back progress. CSR has tended to be dominated by stories. Polished case studies from corporate affairs departments on the one side, and half-baked horror stories from campaigners on the other.
The problem with this confrontational approach – this briefing and counter-briefing, descriptions and counter-descriptions of reality – is that we actually miss the real story: that business can have a hugely beneficial impact on international development.
The answer lies in dry facts. What’s been missing is an evidence-based dialogue. For too long CSR has been led by hearsay and anecdote. Thankfully, things are changing.
Unilever set the pace with the publication in 2005 of a groundbreaking study, done in partnership with Oxfam, about the actual impact of its Indonesian subsidiary in the country ("Exploring the Links Between International Business and Poverty Reduction: A Case Study of Unilever in Indonesia"). The report looked at everything from the impact on employment to the impact on the wider economy. Unilever have now published the sequel – a study of their impact in South Africa, done in collaboration with INSEAD ("Measuring Unilever's Economic Footprint: The Case of South Africa").
Commenting on the INSEAD study, Gail Klintworth, Chairman of Unilever South Africa says:
"until now, although we had an opinion of our impact, we did not have the empirical evidence to understand our broader economic impact, and exactly what “making a difference” should be and the path we would need to follow to get there."
Others are following Unilever's lead, including the World Business Council on Sustainable Development, the International Business Leaders Forum, the Harvard CSR initiative and Business Action for Africa.
Finally, we can get excited: hard facts are bound to reveal more about how we can really make a difference. Time to get beyond the stories.
Friday, 1 February 2008
That’s why the Africa Enterprise Challenge Fund (AECF), launched last year, and with the search for its Fund Managers about to get under way, is so important.
The Fund will offer grants, matched by private sector contributions, to innovative business ideas which encourage greater participation of poor people in markets – as consumers, workers or entrepreneurs.
The Fund is backed by an array of donor agencies, including the African Development Bank, the Consultative Group for Assist the Poor, the International Fund for Agricultural Development, the Dutch Ministry of Foreign Affairs and the UK's Department for International Development.
Interestingly, the Fund will be hosted by the Alliance for a Green Revolution in Africa (AGRA) (which former UN Secretary General, Kofi Annan, chairs), hinting at one of the Funds likely and welcome areas of focus: agriculture - the sector on which most poor people depend for their livelihoods. Finance is the other initial focus, reflecting the difficulty small entrepreneurs often report having in accessing credit and other financial services.
As Business Action for Africa – the network of businesses, business organisation and development partners – this is just the sort of innovative partnership we have been calling for, and we stand ready to engage with the successful Fund Manager to make the AECF the success it needs to be.
Saturday, 26 January 2008
In his original speech last July, Gordon Brown called for a new global partnership to deal with what he sees as a development emergency: the shortfall in progress in meeting the MDGs, particularly in sub-Saharan Africa. The Prime Minister stressed that business has a key role to play in meeting the MDGs.
The 21 business leaders who originally signed a statement in support of this “Call to Action”, have now been joined by other stars of the business and development world, including Bono, Bill Gates and Queen Rania of Jordan. In a joint statement , they have commited to "work to make 2008 a turning point in the fight against poverty...And...to work together to help the world get back on track to meet the MDGs".
This reflects an important trend: the recognition by progressive donors (including the UK's Department for International Development), businesses and non-government organisations that business has a central role to play in meeting the MDGs. In fact, unless the private sector is put right at the heart of the approach of making poverty history, we will never make the lasting progress at the scale and speed that is needed.
In May, the British Government will host an event in London that will bring together government and business leaders to highlight a number of business initiatives that are both transformational and contribute to growth. The agenda will be picked up in September, at broader meeting at the UN of governments, businesses, civil society organisations, NGOs and faith groups to mark the halfway point to the MDGs and to accelerate action.
These events in Davos, London and New York are great news - raising the profile of the MDGs and strategies needed to meet them. But ultimately the test will come when we are able to track real progress on the ground.