The European Union (EU) has announced US$170 billion in financing for Africa as part of the Global Gateway Initiative to strengthen relations with countries across the globe. Notably, almost half of the EU’s total budget for the project ― some US$300 billion ― will go towards the continent, highlighting Africa’s strategic position to European policymakers in planning for the years ahead. Morocco, Europe’s closest geographical partner in Africa, will be one of the first to benefit by securing US$1.8 billion as a supplement to assist in ongoing smart infrastructure development plans. The EU has also positioned its assistance to ensure post-Covid 19 recovery and help to revitalise emerging economies through the modernisation of critical infrastructure, such as energy, education, healthcare and transport. The investment is thought to be in response to China’s Belt and Road Initiative, which aims to expand its trade and investment opportunities through infrastructure development in Africa.
Africa’s Top 10 Stories | March 2022
Sources: European Commission, Voice of America, News24; 2022
The position of TotalEnergies on the East African seaboard appears all but unassailable following a series of promising announcements during February. Early in the month, the company said that it was planning to restart operations in Northern Mozambique after over a year of force majeure borne about by a local insurgency, which has been brought under control by a coordinated military campaign from other African states. In parallel, TotalEnergies and China National Offshore Oil Corporation (CNOOC) announced that they have come to a final investment decision with the Tanzanian and Ugandan governments, which will see the development of the Lake Albert oil fields and co-ordination with the East Africa Crude Oil Pipeline (EACOP) for export through the Tanzanian port of Tanga. Taken together, the developments signify successful progress to the company’s efforts to strengthen its position in the nascent East African oil sector.
Egypt has embarked on an extensive public works programme over the past few months in an effort to revitalise its economy post-Covid 19. The programme encompasses several new smart cities, including a new administrative capital, roads and bridges, and additional one million housing units. Significantly, Egypt announced in February that it would be joining the growing interest in hydrogen energy development projects in Africa. H2 Industries, a German engineering firm, has received the tender to construct a 1GW waste-to-hydrogen facility in the Port Said area of the Suez Canal Industrial Zone. The plant will aim to tackle multiple challenges at the same time by utilising 4 million tonnes of non-recyclable plastic and agricultural waste annually as generation feedstock. On completion, the facility is expected to produce 300 000 tonnes of green hydrogen per year.
Sources: Africa CDC, Reuters, Africa Business Communities; 2022
Africa’s ride hailing service innovations in the digital arena, which have morphed into a super app craze, continue as Uganda’s Safeboda enters the fintech market and Gozem expands its operations to Cameroon. Operating out of East Africa, Safeboda has acquired widespread local success through the digitisation of “boda” or scooter taxi services. Its growing customer base will now be able to make payments via a digital wallet as well as withdraw money through affiliated agents, unlike some of its chief competitors in the region, including M-Pesa. Similarly, Singaporean-based Gozem, a super-app operating across Central and West Africa, has achieved market success in 12 cities across Benin, Gabon and Togo, and hopes to expand its suite of services further. Super-apps have enjoyed an enviable bull run across Africa during 2021, with South Africa’s MTN and Vodacom, and Egypt’s MNT Halan moving into the space.
CEO Keller Rinaudo leading the tour of the medical drone facility during the launch of the company in Rwanda. Zipline has enjoyed success in Africa where lack of infrastructure poses an acute challenge for medical logistics. Source Paul Kagame/Flickr
In early February US-based technology startup Zipline, which offers drone delivery services for medical supplies, signed a deal with Nigeria’s southern Bayelsa state that will see the territory become a key distribution hub for blood, medicine and other “just-in-time” supplies to the nearby region, operating 24 hours a day and utilising Zipline’s fleet of drones. The broader deal will also bring together Zipline and regional authorities into a consortium together with Drugstoc, a Nigerian pharmaceutical company and Sterling Bank, a key financier, to ensure a strong supply chain across touchpoints. Zipline gained widespread notoriety back in 2016 when it began delivering medical supplies in partnership with the Rwandan government. Since then it has expanded to a number of other markets across Africa including Ghana and Cote d’Ivoire. The Bayelsa state partnership represents one of three such operations presently planned for the country, with others already in the works in Kaduna and Cross Rivers states.
In a positive move for press freedom in Tanzania, the Sahulu Hassan Presidency announced in February that it would lift the ban imposed on four local newspapers who had their publishing license suspended in 2017 for criticising late President John Magafuli. The newspapers in question – Daima, Mawio, Mseto and Mwanahalisi – were banned under the Media Services Act and the Newspaper Act, the latter of which has since been repealed. The two acts had been frequently used by the national government to quash reports of corruption and human rights abuses. Since assuming the leadership role in March 2021 Sahulu Hassan has attempted to present herself as a liberal reformer, seeking to encourage foreign investment into local gas reserves and improve relations with civil society ahead of her 2025 re-election campaign. The current development comes off the back of the April 2021 announcements of looser restrictions on online TV channels which were similarly placed under censorship.
Tanzania has been feverishly upgrading its harbours with the aim of expanding capacity for the additional logistics load of new projects. Data courtesy: Flickr/World Bank
The African logistics market is making headway in recent months with Singaporean-based MSC Logistics purchasing Bollore Africa as a way to pave the path for the continent’s closer integration into the world’s supply chains. MSC is wasting no time in capitalising on these inroads, announcing in February that it would be establishing a new intermodal transport route between Djibouti and Ethiopia. Consisting of both road and rail services, the corridor will connect Ethiopia to the Port of Djibouti, and then on to MSC’s global network. Numerous local stakeholders are set to benefit from the development, which will serve as a key enabler of Ethiopia’s ambition to become a manufacturing hub in Africa, while it also plays a vital part in Djibouti’s aim to model the development of the market as an “African Singapore” – the latter country also aims to become a key transit hub between East Africa and East Asia.
Structural factors in the region’s economy have positioned Africa as the next growth frontier for video gaming. February saw the establishment of Pan-Africa Gaming Group (PAGG), an organisation that seeks to bring together game studios from 10 different African countries under a single umbrella. The strategy is for the disparate set of studios to collaborate with one another on communal projects within PAGG, drawing on the expertise of Group CFO Peter Kihara, who brings Goldman Sachs and PricewaterhouseCoopers experience, and BAFTA award-winning British game developer Jake Manion as creative lead. Corporate governance is to be democratic and consultatory, with the various studios maintaining their autonomy and voting on projects as they are proposed to the executive board. With growing mobile and internet penetration and the world’s largest youth market, Africa is primed for developers seeking to unlock “the next billion gamers”.
Sources: Business Insider, IOL News; 2022
Ethiopia powers up GERD bringing water dispute to a head
The Ethiopian government has moved ahead with its plan to activate the Grand Ethiopia Renaissance Dam (GERD) without a binding agreement on downstream water provision with Egypt or Sudan. The dam is set to provide over 6000MW to the region’s power pool, turning Ethiopia into a net energy exporter.
Shell discovers oil off of Namibia’s coastline
Global energy giant Royal Dutch Shell has discovered a viable deposit offshore the Namibian coast estimated to contain between 200 and 300 million barrels of oil. The government is now expecting a wave of new investments, while the Shell-headed consortium plans to export its first barrel of local crude by 2026.
AfCFTA launches adjustment facility to hedge against costs of tariff reductions
The full implementation of the African Continental Free Trade Area (AfCFTA) has achieved another milestone in the form of a US$10 billion tariff-reduction adjustment facility. The instrument will look to alleviate the initial economic costs of removing tariff barriers and is an important step to realising the 90% tariff reduction on African goods traded across borders.