Business: Latest News
Staff, 2:42 pm
Huarong Zhang is chairman of Huajian Group, whose Chinese factories make shoes for Ivanka Trump, Nine West, Michael Kors and other Western brands. This week, Zhang brokered a $ 1.5 billion deal with the Nigerian government to build a shoe factory Nigeria. Huajian already has a shoe factory in Ethiopia manufacturing more than 2,000 pairs of shoes a day that are exported to the U.S. and European markets. Huajian produces 12 million pairs of shoes a year, mostly high-end brands for European and U.S. markets. They typically sell for at least $100 a pair in the U.S.
Tom Jackson, 12:36 pm AFKI Original
Across Africa, banks are choosing to work with startups rather than compete against them. Citibank has run mobile challenges in Nairobi, Standard Bank has incubators in South Africa, and Barclays has just selected its second cohort in its Cape Town-based accelerator. Fintech startups are reimagining the concept, delivery and consumption of financial services in ways banks have been unable. However, such companies lack the financial clout and access to customers to ensure mass uptake of their solutions. Banks can offer them this.
Peter Pedroncelli, 5:36 am
The World Bank Group has committed to supporting the growth of Africa’s digital economy with the launch of XL Africa, a business acceleration initiative that will provide a raft of benefits for the 20 most promising startups in sub-Saharan Africa over the next five months. African digital entrepreneurs will have an opportunity to be mentored by various global specialists, increase their visibility on the continent and receive access to corporate partners and investors.
Dana Sanchez, 9:40 pm
Mastercard hopes to roll out fingerprint payment cards globally by the end of 2017. South Africans’ willingness to try new technology and their familiarity with using biometrics for identification made the country an ideal market to test the payment cards. They’ll work with any card terminal around the world that accepts embedded chip technology. In the U.S., embedded chips are increasingly popular. Regulations make merchants and financial institutions liable for breaches resulting from a lack of support for chip-and-pin cards. Some merchants won’t have to get new equipment to accept fingerprint-enabled cards.
Dana Sanchez, 4:53 pm
An IPO today on the Johannesburg Stock Exchange introduced a new option for investors who want to add African exposure to their portfolios. The AMI Big 50 ex-SA ETF offers 50 African blue-chip companies outside South Africa. The IPO is a world first – an ETF offering exposure to a pan-African index that excludes South Africa. “A lot of people do worry about the liquidity risk, but being an ETF means that there is a secondary market on the JSE which allows investors in smaller quantities to trade exposure in and out of Africa,” a stakeholder said. The ETF is managed by Cloud Atlas, which plans to launch two more Africa-focused ETFs by July.
Staff, 2:57 pm
At a time when aid is under political pressure, a bold approach is needed to maximize the efficiency of donor resources. While governments in Africa are spending more on public infrastructure themselves, outside finance is still required, especially for regional projects — rarely a priority for national governments. Aid from Africa’s traditionally generous foreign donors is set to shrink. There may be a solution. The “Big Bond” is a strategy for leveraging foreign aid funds in international capital markets to generate financing for massive infrastructure investment.
Peter Pedroncelli, 3:25 am AFKI Original
Many of us take access to electricity for granted, but only two out of every five people in Africa have decent access to energy to power lights and other electrical appliances throughout the day. Around 625 million people in Sub-Saharan Africa have no access to electricity, according to the International Energy Agency. We take a look at 12 Sub-Saharan African countries with the best access to electricity.
Staff, 8:36 pm
Pension funds are good news for infrastructure projects in Africa. Development banks and private equity funds are targeting pension funds in Africa as sources of investment capital. Four African countries hold 90 percent of Africa’s pension fund assets. Despite challenges, African pension funds are likely to make a substantial impact on infrastructure investment in the next few years. One promising trend is the rise of regional funds targeting pensions. They’re making a new source of African capital available to address the region’s infrastructure deficit.
Staff, 1:00 am
By moving manufacturing to Ethiopia, Chinese textile companies are moving closer to their raw material base, the cotton-producing countries. This is part of their value chain repositioning, a strategy most Chinese companies are adopting. They’re are also using Africa as a gateway to emerging markets on and off the continent. Products made in Ethiopia can be exported duty- and quota free to the U.S. under the African Growth and Opportunity Act (AGOA). The same benefits apply to the E.U. Ethiopia also offers cheap electricity at US$0.04 cents per kilowatt hour. It’s now the second-largest electricity producer in sub-Sahara due to its hydropower dams.
Staff, 12:01 am
The fall in African private equity investment in 2016 could be a short-term blip. Among the losers was US-based Carlyle, one of the world’s winningest investment firms. Carlyle invested $147m in Nigeria’s Diamond Bank in 2014. The bank’s market cap fell by 90% over the subsequent two years. Bob Geldof’s PE firm 8 Miles just invested in Blue Skies, a British fruit firm that operates in Africa. Utilities including telecoms were the most popular target for private equity investment in 2016. West Africa was the most active region.
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