Africa Open For Business, But Not At Any Cost – Tony Elumelu


By  Oyeniyi Adegoke | Ventures Africa

June 28, 2013

VENTURES AFRICA – On the eve of his departure to Dar es Salaam, Tanzania, as part of a delegation of high profile African business leaders handpicked by the White House to meet with President Obama, Tony O. Elumelu, chairman of one of the most diversified investment groups in Africa, reiterated his message for the United States and international investors to engage proactively with Africa’s private sector to develop the continent.

In a wide ranging interview, Elumelu talked about the rules of engagement for Africa having changed and that those looking to invest on the continent should consider aligning with an economic philosophy he called Africapitalism.

“Africa’s economic history has been characterised by extractive industries and rent seeking practices that have not created development in any meaningful way. Africapitalism is simply saying there is a better and more ethical way to invest in Africa for a sustainable future. I would like to see both African and international investors review their strategies for Africa. Yes, we are open for business but not at any cost. Our rules of engagement have changed,” said Elumelu.

It is anticipated Elumelu will be part of a major announcement the US government will make about the power sector. Through Transcorp, one of Heirs Holdings investee companies, the group recently invested $300 million in Nigeria’s largest power plant, located in Ughelli, Delta State during the Nigerian government’s recent power privatization process.

Commenting on the motivation behind the power investment, he said, “Unlimited access to affordable power in any country is a game changer and will move the needle on the country’s development exponentially.

“We are taking over an old government-run plant that desperately needs rehabilitation and doubling its output within our first two years of operations. By 2017, we will be generating 1000MW of electricity…”



Zimbabweans welcome government push toward solar energy

from Thomson Reuters Foundation AlertNet..

By Madalitso Mwando

June 30, 2013

HARARE, Zimbabwe (Thomson Reuters Foundation) – On the roof of Thomas Phiri’s small wooden cabin in Harare’s Westlea suburb lies a small solar panel, slightly larger than a sheet of writing paper.

It may be small, but the panel is enough to ensure Phiri has a warm meal – and it has become a source of relief amid endless power outages.

“This is by far the best investment I have ever made,” said the homeowner, one of an increasing number in Zimbabwe who are turning to solar energy as the country battles a power deficit.

Cheap solar panels are among the Chinese products now flooding into Zimbabwe, and the government is investing in larger-scale solar as well for the first time.

The Zimbabwe Power Company, a government agency responsible for power generation, in June announced plans for an ambitious 100 megawatt solar power project in Gwanda, 130km north of Bulawayo, as part of fresh efforts to boost the country’s power supply.

The country has relied heavily on fossil fuels and hydropower, but those have failed to provide enough electricity. The country is regularly saddled with a crippling power deficit.

The Zimbabwe Energy Regulatory Authority (ZERA) says Zimbabwe requires around 2,500 MW per day but is only generating 1,200 MW daily.

Zimbabwe’s move toward solar power has attracted interest from Chinese investors who have already been awarded contracts for the expansion of the Kariba Dam hydropower station, and who are involved in a Hwange fossil fuel power generation project.

According to Elton Mangoma, Zimbabwe’s energy minister, sites for new 100 MW solar projects have been identified in Gwanda and Zvishavane. But the bidding process for other new energy projects has run into complications, raising some questions about whether the projects will be built quickly, or at all.

“I think it is pretty ambitious,” said Bulawayo economist Tim Limbikani. But “let’s see how it turns out because that is what may well salvage our industries,” Limbikani said.

The country has struggled with power outages that have been a particular threat to industry.


Some power users say they welcome solar energy projects, seen as a source of cheap energy, but fear heavy foreign investment in a range of new generating capacity could lead to higher power bills that they will struggle to pay.

“We are already failing to pay our bills but if government is building solar energy plants, this is welcome if it will ease power cuts. My only concern is affordability,” said Phiri, expressing a common sentiment in a country where consumers are resisting paying bills for water and electricity, citing erratic supplies.

Solar energy is expected to have an impact in the country’s in the agriculture sector, where smallholders have long complained that irrigation schemes have suffered in the absence of a regular supply of electricity.  The Commercial Farmers Union says solar generation is one way to ease that problem.

Scores of farmers across the country have lobbied the government to compel the Zimbabwe Electricity Supply Authority to stop disconnecting power for nonpayment of bills. They have also asked for farming areas to be exempted from load shedding.

“It’s been tough for us (farmers),” said Gilbert Tshuma, a beneficiary of the land-reform project who runs a maize and poultry farm just outside Harare.

“We cannot all invest in solar because the (solar) panels are pretty expensive. We have always lobbied government to seek cheaper ways of electricity generation and welcome any announcement that this is being taken seriously through this solar project that has been announced,” Tshuma said.

Power outages have been particularly bad for poultry farmers who last year reported that they had lost as many as a million eggs to persistent power outages.

Madalitso Mwando is a journalist based in Harare, Zimbabwe.

Link to the article:

Ethiopia’s tech hopefuls

from BBC News..

By Jonathan Kalan
Addis Ababa, Ethiopia

June 27, 2013

When it comes to technology and innovation, Ethiopia appears a long way away from the rest of Africa’s rising “silicon savannahs.”

The most advanced form of banking in Africa’s second most populous country is an ATM – there are no credit cards and no international banking systems.

This makes app stores like Google Play and Apple’s Appstore inaccessible.

Mobile money, which has taken off places like Kenya, has only just arrived, but with significant limitations.

Skype and other VoIP (voice over internet protocol) services are banned for business purposes.

With a lumbering government-owned telecoms monopoly, staggeringly low internet penetration (less than 1% of Ethiopia’s 85m citizens are connected), just 17% mobile penetration, and a very “security conscious” government approach to new technology and services, it’s not the most encouraging environment for small technology start-ups to grow.

Ethiopian children play with a mobile phoneCall me: Only 17% of Ethiopians have access to a mobile phone, lagging behind many of its neighbours

But that doesn’t mean some aren’t trying.

“There are a lot of opportunities for techies in Ethiopia,” claims Markos Lemma, co-founder of iceaddis, Ethiopia’s leading technology hub, accelerator and co-working space.

“The middle class is increasing, the market is growing,” he says.

“Agricultural productivity is increasing, farmers are making more money, and even they are interested in new solutions.”

All change

In recent years Ethiopia has become a model of rising Africa.

From a poster child for poverty and famine in the 1980s to an economy seeing an average 10% growth since 2004, the country is witnessing a remarkable turnaround.

Addis Ababa, the capital, is attracting investment and talent from around the world, and cranes and construction projects are now a hallmark of the city.

Addis AbabaCan we build it: Ethiopia’s rapid growth can be seen in the contruction projects going on across Addis Ababa

Yet much of this growth is from sweeping policy changes, government infrastructure projects, and big donor-driven or private investment programmes.

Iceaddis, which opened its doors in May 2011, is trying to change this.

It has become a home for start-ups, promoting local technology and focusing on young Ethiopian entrepreneurs and individuals interested in ICT, green technology, and the creative industries.

Originally designed as an art gallery by a Swiss architect, it is a striking mash-up of six interlocked shipping containers, located on the Ethiopian Institute of Architecture, Building, Construction and City Development (EiABC) campus, in the heart of the capital.

“In the beginning, we didn’t know what exactly what we were working on,” admits Mr Lemma, one of the four co-founders. “We were just bringing the community together to interact.”


Link to the entire article:

Cyprus debt in default over bond swap

from BBC News..

June 30, 2013

Cyprus’s debt ratings have been downgraded to “default” after it announced it would delay paying back 1bn euros ($1.3bn; £860m) of bonds.

Standard & Poor’s lowered the island’s credit ratings to “selective default” from CCC/C.

Cyprus will swap government bonds maturing in 2013 through to the first quarter of 2016 with new debt that matures at between five and 10 years.

The EU country has to do the bond swap to meet the terms of its bailout.

S&P said on Friday that the “exchange materially changes the terms of the affected debt and constitutes what we consider a distressed exchange”.

“We view the extension of maturities without what we find to be adequate offsetting compensation as the exchange of new debt on less favourable terms to the existing debt.”

Earlier this year, Cyprus secured a loan package worth 10bn euros from its EU partners and the International Monetary Fund. This included a tax on large deposits and thorough banking reform, which will raise 13bn euros.

An early proposal to raise money through a levy on all Cypriot bank deposits – including those below 100,000 euros – caused panic in financial markets and was quickly withdrawn.

Cyprus’s rescue followed bailouts of Greece – twice – as well as Ireland, Portugal and Spain’s banks.

After the bond swap, due on Monday, S&P said its debt rating was expected to rise back to CCC+. That still means the country’s debt is considered speculative and “currently vulnerable and dependent on favourable business, financial and economic conditions to meet financial commitments”.

But it added that the “government will still need to deal with” with 950m euros worth of short-term debt that is due soon.

That is the equivalent of 5% of the country’s whole economy.

Link to the article:

Qatar: A country of seemingly ironic contrasts

from BBC News..

By Frank Gardner
BBC News, Qatar

June 29, 2013

The Emir of Qatar did something almost unheard of this week when he abdicated in favour of his son. What kind of state has 33-year-old Sheikh Tamim Al-Thani – the Middle East’s youngest ruler – inherited?

“So let me get this straight,” I said to Qatar’s Prime Minister, at the start of our interview.

“You disapprove of many of America’s policies in the Middle East, yet you are hosting the Pentagon’s biggest military base in the region?”

There was a pause, and a slow smile.

“It’s true,” he replied, “but we own the keys to the base.”

That conversation was over a decade ago and now Qatar has a new ruler and a new prime minister.

The place has changed almost beyond recognition from the torpid Gulf backwater I first visited in the early 1990s.

Steel and chrome skyscrapers have shot up where there used to be nothing but desert.

Using its vast wealth from offshore gas deposits, the once sleepiest and slowest of all six Gulf Arab states has recently fast-tracked itself to become an economic powerhouse.

All very impressive for a country with fewer than 500,000 Qatari citizens.

So there is no mistaking, Qatar is rich. But it is also a country of seemingly illogical contrasts.

Take the Taliban. Qatar generously offered to host their office for peace negotiations which opened amid confusion and recriminations from Kabul.

Most of the fuss centred on the Taliban’s flag that they were not supposed to put up. It was inside their perimeter walls but outside their office.

After a rap on the knuckles from the Qataris the Taliban took it down, but then, when they thought no-one was looking, they put it back up again – this time on a shorter flagpole.

I could see it clearly, flapping in the oven-hot breeze of early afternoon. After howls of protest from the Afghan government in Kabul it was taken down again.

Now, the Taliban are a hardline Islamist movement, usually associated with Afghanistan’s long-running insurgency and the disavowal of almost all earthly pleasures.

Yet it turns out that its representatives have been in Qatar for quite some time and have adapted remarkably well to the lotus life in the Gulf.

“You can see them any weekend,” one local resident told me. “They go shopping in City Centre Mall. They have even had babies out here.”

Less than an hour’s drive from the Taliban’s smart new villa in Doha lies the giant US-run airbase of Al-Udaid.

This is where most of the coalition’s air operations in Afghanistan are co-ordinated from and it is strictly off limits to visitors.

When a frontline combat unit on the ground in, say, Helmand province, radios its base for air support, the request then gets routed through Qatar.

So just a short distance from the very building where Afghan peace talks may eventually get underway, coded signals are being dispatched that send Apache helicopter gunships or F16 jets into action against the Taliban.

Then there is the question of Israel. As an Arab and Muslim nation, home to the satellite TV station Al-Jazeera, Qatar has played host to plenty of Israel’s noisiest and most vitriolic detractors.

And yet unknown to most people, Israel had a discreet trade office in Qatar that only closed as recently as 2009 after its military incursion into Gaza.

The ironies do not end there.

Of all the Gulf countries, Qatar is closest to the Muslim Brotherhood, the Islamist organisation that has swept to power in Egypt.

It is home to its spiritual figurehead, the populist preacher Yousef Al-Qaradawi.

Yet Qatar, which used to impose a strict ban on alcohol, does have some well-stocked bars if you know where to go.

Steering a middle course between the demands of the country’s more devout citizens, who oppose such creeping western immoralities, and those who want to open up this tiny country further to the outside world – will be one of the major challenges facing the new Emir.

Sheikh Tamim Al-Thani may have only just turned 33, but he has spent the last 10 years training to take over from his father and Qataris have been quick to pledge their allegiance.

He has been instrumental in helping the emirate punch above its weight on the international stage, supporting rebels first in Libya and then in Syria.

This new-found clout, backed by fabulous wealth, is already making neighbouring states nervous.

Some fear it may be over-reaching itself in helping to fuel a conflict with no end in sight. But Qatar has come a long way in a short time.

Not that long ago I remember Egypt’s now-deposed President Mubarak complaining, during a spat with Qatar’s ruler: “Why should I pay attention to a country with the population of a small hotel?”

People are certainly paying attention to it now.

Batumi: One Square Mile Georgia

from BBC News..

By Damien McGuiness
BBC News, Batumi, Georgia

June 28, 2013

The glitzy Black Sea resort of Batumi is visible proof of Georgia’s ambition to westernise and shake off its Soviet past.

A golden Ferris wheel is built into the side of one modernist skyscraper. Fountains spurt in time to French pop music blaring out of speakers dotted along the promenade. At night the whole city is lit up purple, blue and red, like an out-of-control Christmas tree.

Subtle, Batumi is not.

A decade ago the city was a dingy and impoverished corner of the former Soviet Union. Today, it is a brash gambling town of bright lights and flashy casinos.

Welcome to the Las Vegas of the Black Sea.

In fact, gambling can be seen as the ultimate incarnation of Georgia’s ultra capitalist aspirations: fast bucks, low regulations and big risks.

Ambitious experiment

It has helped Batumi become a booming destination for tourists from nearby Turkey, where gambling is illegal.

According to the manager of the Peace casino, 95% of his customers are from Turkey.

He estimates that the casino business and the money gamblers spend on holidays in Batumi provide about a quarter of the local budget.

Turning Batumi into a Georgian Monte Carlo is the most visible sign of an ambitious experiment to transform this country.

The Ferris wheel incorporated into a high rise building in Batumi, Georgia.Batumi’s buildings are as inventive as they are impressive.

That experiment began after US-educated lawyer Mikhail Saakashvilli, who led the 2003 Rose revolution, became president at the age of 37 and embraced all things Western.

Democratic reforms swept the country, petty corruption was wiped out and Western aid and investment flooded in.

In his office, President Saakashvili used to show visitors a model of a futuristic metal tower, topped with a space-age metal globe, which he had helped design.

Today, known as the Alphabet tower, it stands on Batumi’s boulevard, dominating the skyline.

Minority rights

For Mr Saakashvili, this city is a gleaming symbol of Georgian success. But the glitzy new face of Batumi has a flip side.

During a decade of untrammelled power, high-level corruption and cronyism within the Saakashvili government grew.

“The contracts handed out for a lot of these infrastructure projects involved more money than the real cost of the buildings,” says local politician Parmen Jalagonia, pointing to the flash new towers around us.

President Mikhail Saakashvili enjoys a toast with US Secretary of State Hilary ClintonPresident Mikhail Saakashvili, seen here enjoying a toast with US Secretary of State Hilary Clinton, has modelled Georgia’s economy on that of the US

Many poorer and older Georgians felt ignored and left out of Mr Saakashvili’s US-style turbo-capitalist economy.

While Mr Saakashvili remains president, his government was ousted from power in elections last year. For many in Batumi, that has raised hopes of a change.

“Everyone is really hoping things will get better. And everyone thinks that the new government will improve things,” says Sveta Shuskaya, who earns between $3 and $12 a day selling flowers and nuts that she grows in her garden.

But although the new government has promised to improve the lives of the poor, there are fears the country may be becoming less tolerant.

Batumi is a test bed for Mr Saakashvili’s brand of Western capitalism. And that not only includes American-style cut-throat free markets but also means promoting European attitudes of tolerance towards minority groups.

Under President Saakashvili’s government, laws were passed guaranteeing rights for other religions. But some now fear those rights may be eroded under the new administration.

And it’s in Batumi that this aspiration could face its biggest test.

This region is home to Georgia’s largest community of Muslims, who’ve been here since the 16th Century, when the area was part of the Ottoman empire. After the collapse of the Soviet Union in 1991, the Georgian Orthodox Church became an increasingly important part of the newly-independent state and of Georgia’s national identity.

Muslim Georgians started converting back to Christianity but today around 30% of the population is thought to follow Islam.


Outside Batumi’s main mosque, Muslims gather for Friday prayers. The mosque is full, so mats are laid outside on the street, and about a couple of dozen Muslims kneel down to pray.

Suddenly an angry man, attracted by our camera, starts shouting at me: “When people pray here, we all have to hear it!” he screams jabbing a furious finger in my face. “Is that fair?”

He says he works next door and is outraged at having to hear the sounds of Muslims praying on Fridays. His rights are being undermined, he shouts.

Batumi's dancing fountains in tune to the music with the Alphabet tower in the background.Batumi’s fountains dance in tune to the music with the Alphabet tower in the background.

Since the new government took over in October there have been at least three small protests in this region against Muslims.

“If we Muslims practise our faith openly, then the majority population attack us,” explains Muslim journalist Eter Turadze, editor-in-chief of the region’s main newspaper.

“Most Muslims here feel humiliated, because our Georgian identity is being questioned,” she adds.

Keen to join the EU, President Saakashvili’s government had strongly defended minority rights.

But some supporters of the new government say this is a Western concept, which undermines Georgian identity, traditionally defined by some as white, Christian and heterosexual.

Ten years into its capitalist makeover Batumi has been absolutely transformed.

But the challenge for Georgia’s new government is how to preserve the tolerant attitudes of the Saakashvili era while at the same tempering its excesses.

Link to the article and video:

Georgia’s mighty Orthodox Church

from BBC News..

June 30, 2013

When several dozen Georgian Orthodox priests led tens of thousands of people on a violent attack against a small group of gay rights activists in Tbilisi earlier this year, much of the rest of the country was horrified, writes journalist Paul Rimple, who has been based in the country for 10 years.

Georgians pride themselves on their reputation for being hospitable and tolerant, and most consider themselves Christian.

While the notion of homosexuality is not widely understood or accepted in this deeply traditional Caucasus nation, most Georgians were appalled by the scenes that unfolded in Tbilisi on 17 May.

And yet, what happened clearly illustrates the importance of the Church in Georgia.

Georgia became the second nation in the world to accept Christianity as a state religion in 337AD. Georgians maintained their faith over the centuries despite the waves of invading hordes, including the armies of Ghengis Khan and Tamerlane.

Although the Soviets permitted religion to be practised, its reach was severely limited. In 1917, there were 2,455 working churches in Georgia, but by the mid-1980s there were only 80, along with a few monasteries and a seminary.

“During communism, the church was outdated, something for old ladies,” says political analyst Ghia Nodia.

That attitude quickly changed after independence in 1991, when the elected president, Zviad Gamsakhurdia, espoused a philosophy of ethnic nationalism, which the Church embraced.

“During the (Gamsakhurdia) national movement, the concept that real Georgians are Orthodox Christians spread really fast,” Mr Nodia says.

Tbilisi's Sameba cathedral was built at considerable expense after Georgia gained independence in 1991
Tbilisi’s Sameba cathedral was built at considerable expense after Georgia gained independence in 1991

Over 80% of Georgia’s 4.5 million people say they belong to the Georgian Orthodox Church, however, experts claim only about 15% – 25% actively participate in rituals.

Nevertheless, the Orthodox Church remains the most trusted institution in Georgia. In a February survey carried out by the Caucasus Resource Research Center (CRRC), 95% of respondents had a favourable opinion of its work.

Beka Mindiashvili, a former theologian who is now head of the Tolerance Center at the public defender’s office, attributes such high confidence in the Church to the 80-year-old Patriarch, Ilia II.

“He possesses all the right attributes. He is charismatic, he speaks slowly and each word is regarded saintly, holy,” Mr Mindiashvili says.

“He is a person for everybody. To a simple person, he speaks simply; to a politician, he speaks politically; to an intellectual, he speaks of Umberto Eco and of classical music. And he acquired absolute power in the Church all by himself.”

There were only about 50 priests when Ilia II became patriarch in 1977. Today there are approximately 1,700.

His first major test in power was in 1997, when a number of anti-ecumenical abbots threatened to break communion with him for being too liberal. He avoided a schism by breaking off ecumenical activities and pursuing what philosopher Zaza Piralishvili calls an “imitation of medieval rhetoric”.

Examples of the Church’s ultra-conservative interventions included warnings that yoga was full of false “charms” that lured people away from God as well as a recent mass mobilisation against ID cards after some Georgian Orthodox leaders claimed the cards bore the mark of the anti-Christ.

The Church is recognised for maintaining a neutral political stance and Ilia II is renowned for playing a significant role as mediator in political confrontations, which in Georgia can easily turn violent.

Professor Iago Kachkachishvili, head of the sociology department at Tbilisi State University, says the Church’s political neutrality is a myth.

“The Church’s influence comes from public opinion,” he says. “It uses the trust of the people as a source of strength. And every government and politician uses the Georgian Orthodox Church as a source of legitimacy.”

While the constitution stipulates a separation between church and state, a 2002 concordat defined this relationship by granting the Church official recognition in Georgia and a special consultative role in the government, particularly in education.

In 2009, Mikheil Saakashvili’s government awarded the Church a $15m (£10m) grant – three times the amount of the previous year – and presented luxury sports utility vehicles to each of the 10 archbishops.

Despite the lavish gifts, many conservative elements within the Church, who are pro-Russian, openly voiced their displeasure with the president. They saw his pro-Western orientation as a threat to Georgian traditions and the Church’s influence on the people.

Orthodox priests were at the fore front of the protest over the Gay Pride march in TbilisiOrthodox priests were at the forefront of the protest over the Gay Pride march in Tbilisi

The clash of ideologies came to head in July 2011, when parliament passed a law allowing religious minority groups in Georgia to be registered as legal entities in public law giving them legal protection previously only enjoyed by the Orthodox Church.

The move was applauded in the West, but the Georgian Orthodox Church saw this as an infringement on its special status.

Although Ilia II requested the clergy to maintain neutrality in the 2012 parliamentary elections, many priests broke ranks and openly supported the coalition of billionaire Bidzina Ivanishvili, who had provided the funds to build Tbilisi’s Sameba Cathedral, the largest church in Georgia.

But on 13 May, Bidzina Ivanishvili who by now was prime minister, took an independent stance and became the first Georgian politician to declare openly that sexual minorities were equal citizens of this country.

Three days later, Ilia II called on the authorities to ban the 17 May demonstration. This marked the first open confrontation between church and state and culminated in expletive-shouting priests chasing gay activists down the main streets of the capital.

Protesters broke through barricades and police were forced to bus the small number of activists out of the area for their protection.

The day after the attacks, Tbilisi artist Magda Guruli joined some 100 people who rallied in the city centre to call for justice.

She believes the response to the protest was a manifestation of the patriarch’s power over the state.

“I’m here to say give me back my religion,” she said. “Orthodoxy is part of our culture, but who are these people who try to influence society and try to influence their thoughts and try to cultivate blind faith?”

Link to the article: