All posts by Michael Patotschka

South Africa

South Africa slips to Africa’s third-largest economy

South-Africa has been known as the continent’s second largest economy since Nigeria rebased its gross domestic product (GDP) data in early 2014. However, the International Monetary Fund’s World Economic Outlook, released in mid April 2016, revealed that the South African economy is now only the third-largest economy on the continent after Nigeria und new silver medallist Egypt.

By the end of 2015, Nigeria’s GDP was estimated at US$ 490 billion, followed by Egypt with US$ 324 billion and South-Africa with US$ 313 billion.

Egypt overtook South Africa mainly owing to the slump of its currency, the Rand. As a result, the nominal dollar value of South Africa’s GDP has dropped by an average of almost 7 percent a year over the past four years.

South Africa, however, remains the continent’s most developed economy and has a more diversified base than any other on the continent. It is ranked as an upper-middle-income economy by the World Bank –   one of the only four countries in Africa (alongside Botswana, Gabon and Mauritius).

Source: African Courier, June/July 2016

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General

Africa’s phone users reach 700 million

Mobile phone subscriptions are now almost eight times higher in Africa than in 2000, reaching about 700 million. According to a new report by the International  Telecommunications Union, mobile technology has played a crucial role in promoting financial inclusion in sub Saharan Africa, where fewer than 20 per cent of households have access to formal financial services. … Mobile phone banking services are especially prevalent in Kenya and penetration rates are also relatively high in Uganda and Tanzania. The other countries with high mobile money account penetration rates are Côte d’Ivoire, Zimbabwe, Botswana, Rwanda and South Africa.

Regulaory reforms and liberalization have also benefited local mobile operators, with countries such as Ghana, Nigeria and Tanzania having more than five local operators.

The report said sub Sahara Afric’s greatest development change is to move from an economic growth path based on commodity exports to a more sustainable industrial and services path. The mobile technology revolution can support and underpin this economic diversifications, experts say.

Source: African Courier, June/July 2016

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General

The long view for Africa

While many question Africa’s achievement over the last decade, there is a greater perspective needed to show how far Africa has just come.

Certainly, Africa is not monolithic –   it’s 54 Africas –   but just if you count up the GDP figures for the whole continent, it averages 5 % growth per year over that period, according to the world bank –   a strong long term position that is well above the global average of 3 % over the last decade..

Since 2000, Africa has also seen a 200 % increase in intra-continental trade and trade with the rest of the world. Fast forward, Africa continues to house some of the world’s fastest growing economies and despite the recent collapse in commodity prices, private equity investment grew by 51 % last year.

At least a dozen economies have grown by more than 6 % per year for six years or more.

Source: AI, May 2016

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General

African startups need foreign investment – booming middle class

Nigeria’s population will be over 440m by 2050

Historically, fast growing African tech companies needing an immediate capital injection would have to reach out to foreign investors for this funding.

The need for investment, whether foreign or domestic, is crucial to both established an startup technology companies in Africa.

As most companies are unprofitable for a couple of years, capital is required to disrupt the current status.

Positive trends

The changing demographics in most African countries are helping consumer focused technology companies to reach better sales figures. A perfect storm of increasing smartphones penetration, improving disposable income and the rise of a highly connected younger generation is boosting this sector

Positive trends

There are almost 1bn Africans on the continent; millions are coming online each week, almost via the mobile, which is what’s driving demand. Soon, there will be more than 400m smartphones on the continent. The mobile is the most powerful communications and technology tool on the continent.

It is no surprise that many successful tech startups are based in Nigeria, Based on current projections, Nigeria’s population is forecast to grow to over 440m by 2050 and see a rapidly increasing middle-class population, with commerce spending in the country on track to total $8bn by 2025-

One thing is for sure – this is only the beginning of Africa’s tech boom.

Source: African Business, May 2015

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Nigeria

Additional 10 000 megawatt by 2019 in Nigeria

President Muhammadu Buhari said on Monday that his administration would ensure steady power supply before the expiration of his tenure through the provision of additional 10,000 megawatts.

The President gave the assurance at the National Economic Council Retreat holding at the Presidential Banquet Hall, Abuja.

According to him, 2,000 of the anticipated 10,000 megawatts will be added to the national grid in 2016.

“Nigerians’ favourite talking point and butt of jokes is the power situation in our country. But, it is no longer a laughing matter.

“We must and by the grace of God we will put things right.

“In the three years left for this administration we have givenourselves the target of 10,000 megawatts distributable power.

“In 2016 alone, we intend to add 2,000 megawatts to the national grid.

“In our determination to change we must and will, Insha Allah, put a stop to power shortages.’’

The President, who stated that the nation was facing the classic dilemma of privatisation of the power sector, noted that no remarkable improvement in the quality of service had been recorded after the exercise.

He, however, stated that the National Electricity Regulatory Commission (NERC) must ensure that consumers get value for money and over-all public interest is safe-guarded as government will complete the process of the privatisation.

Source: Daily Post, Mach 22, 2016

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