What we're reading... Expats vs Local Impact Entrepreneurs, Investment Lessons, Geopolitics and Baba Go Slow
World Economic Forum (WEF) is doing its thing yet again. Tackling some sensitive subject matter. There was tax evasion at the start of the year, and now the predominance of “expats over African entrepreneurs” as the recipients of disbursed impact investment funds. The WEF piece describes northern hemisphere investors with a bias for northern hemisphere business models or trends, and mismatches in communication, reporting, expectations and more all leading to inefficient capital allocation.
The recommendations are meaningful: (a) respect for local knowledge and social capital, which are important for long-term sustainability of business models, (b) evolve local business people in the investment decision-making process, (c) donor/investor investment in locally managed entrepreneur support networks. A number of these themes came up in our recent interview with Jerry Parkes of Injaro and in earlier commentary about cultural gaps on impact investment in northern Ghana, which we’ll be reprinting soon.
Along the same lines, Nabil Triki, managing partner at SPE Capital, one of our strategic partners, was interviewed by Africa Private Equity about key investment lessons: finding the right partners irrespective of asset and intrinsic value, seeing the opportunities in succession, leverage and margin issues are some of the core themes thrown up, and it’s well worth reading.
Also, a nuanced piece in The Africa Report on how the US-China rivalry, particularly the Huawei spat, is playing out in our region. Given the extent of Huawei’s presence, the region is automatically drawn into the battleground. However, with the notable exception of South Africa’s Cyril Ramaphosa, most leaders are pursuing a policy of pragmatic silence. Ramaphosa by contrast has made comments that accept a narrative of China-US geopolitical rivalry, wherein the US is jealous of and seeking to frustrate Chinese advancement.
In Nigeria, there was a great piece about the slow pace of gubernatorial appointments in Nigeria; only three of 29 governors having formed their cabinets almost two months after their swearing in.
We're keenly following the initiative in Ghana by one of the nation's largest media outlets, Citi TV, to rid the streets of indisciplined driving. The aptly named, War Against Indiscipline, a collaboration with the police, has reportedly generated over GHS 258,000 (USD 48,000) in the two months that it has been running so far (scheduled to run in to 2020). Aside from cringeworthy videos of various state officials attempting to explain their flagrant flouting of traffic laws, the campaign has highlighted the extent of the problem and points to potential solutions.
QuartzAfrica looks at the feasibility of ECOWAS being able to launch its long-planned, much-delayed ECO common currency in 2020 (SPOILER ALERT: NO). Even if political will exists, the modalities of implementation and the fiscal requirements that will be placed on states mean that the deadline will be missed yet again.