🔅 The East Asian Development Model Might Not Work for Africa
Plus: Germany and Africa Make A Green Energy Match Made in Heaven, Kenya and Uganda's Oil Drama, Somalia's Countdown to Kicking Out Al Shabaab, And more...
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MTN's CEO Predicts Bright Future for Nigeria | The CEO of Africa's biggest wireless company, MTN, has some good news for Nigerians: the pain of economic reforms will be worth it for businesses in the long run. Ralph Mupita believes that by mid-2022, the country will have overcome the discomfort caused by President Bola Tinubu's structural changes. https://www.bloomberg.com/news/articles/2023-11-09/africa-phone-giant-mtn-expects-nigeria-reform-recovery-mid-2024
*Data accurate as of the close of markets across the continent
Brief & Bright: Africa's Top Five
The East Asian Development Model Might Not Work for Africa
Turns out, the East Asian development model of using manufacturing to lift people out of poverty may not be the best fit for African countries. A new study by the Center for Global Development predicts that, by 2050, there will be fewer factory jobs globally than there are now. China will continue to dominate the manufacturing sector, producing almost half of global output, notably by moving into higher-value segments. And while that will leave room for lower-income countries to step in, it won't be enough to witness Africa replicating the success seen in East Asia. Instead, the study suggests that many African countries will skip the manufacturing phase altogether. As they move away from farms, they will jump straight to services, where jobs will be plentiful thanks to new technologies. Indeed, service sector jobs are estimated to make up 37% of global jobs by 2050.
Germany and Africa: A Green Energy Match Made in Heaven?
German Chancellor Olaf Scholz has promised to invest €4 billion in the Africa-European Union Green Energy Initiative over the next decade. But this isn’t your typical “development aid” situation—Scholz says he wants to ensure it’s a mutually beneficial investment. He aims to have a large part of Germany’s green hydrogen supply come from Africa. "Hydrogen production requires considerable investment at the start, so clear signals for a long-term and durable cooperation are needed," said Scholz. This happened on the back of German companies signing two accords with Nigeria that include a $500 million renewable energy pact and a gas export deal. Nigeria holds Africa's largest gas reserves of more than 200 trillion cubic feet, but flares, or burns off, about 300 million cubic feet daily due to inadequate processing facilities.
Kenya and Uganda's Oil Drama: A Tale of "Parasites"
A feud over fuel prices has erupted between Kenya and Uganda, with the Ugandan president calling out "parasites" and middlemen for cheating his country out of millions. Kenya has been the leading oil supplier to its East African neighbours for years, but now Uganda wants to break free and make its own deals. The Kenyan government accepts the blame for recent high prices, saying they had to negotiate a credit deal with international suppliers due to a shortage of US dollars, where they paid six months later in Kenya Shillings, not dollars, unlike its neighbours, which made it more expensive for them. This deal has been dubbed a "mega scam" by Kenyan opposition leader Raila Odinga, who wants to investigate the terms. It is not only Uganda that is unhappy, but also other East African nations who rely on Kenya for their oil supply, like Burundi and South Sudan. This feud has caused a lot of grumbling in the region.
Somalia's Countdown to Kicking Out Al Shabaab: One Year and Counting
Somalia’s President Hassan Sheikh Mohamud has set a deadline for expelling al Shabaab from the country: December 2024. That’s when the African Union peacekeeping forces are scheduled to leave, so Mohamud wants to make sure the militant group is gone before then. He’s been making progress with the military’s help, but the recent floods have made things a bit tricky (although it has also made it harder for al Shabaab to spread landmines). Mohamud says he’s willing to negotiate with the militants, but for now, the focus is on eliminating them. And he’s asking for help from the international community to rebuild Somalia’s infrastructure and provide essential services like health and education. Earlier this month, Somalia got a $100 million boost from the IMF.
Army Recruitment Gone Wrong: The Tragic Night at a Congolese Stadium
The Republic of Congo's capital was rocked by a tragic event at the Ornano stadium, where army recruitment operations were being held. The government reported that over 30 people were killed and dozens more injured, with some reports claiming a stampede broke out during the recruitment drive. Images on social media showed young men injured on the basketball court, and the recruitment process has been suspended. The country is no stranger to unemployment, with over 20% of men jobless. A day of mourning has been declared to honour the lives lost.
Food for Thought
“Knowledge without wisdom is just like water in the sand."
— Guinean Proverb