Have you ever been a victim of fraud or identity theft, where some of your personal documents were stolen and the data used fraudulently? Today, with online shopping and social media being a way of life, you cannot afford to be complacent about protecting your financial information. In today’s ‘virtual’ world, we are much more vulnerable than ever and must be more vigilant in safeguarding our finances. Here are some tips to minimize the risk or damage of this happening to you.
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Are your sensitive documents kept securely,
Where are your certificates and other important documents? Are they lying around in unlocked drawers or are they locked away securely in a fireproof safe? Apart from securing the physical documents, scan and secure them electronically.
It is not enough to just casually discard old financial statements; they can become prime target for thieves. Invest in a paper shredder; a personal one for home use is not very expensive and with this you can effectively destroy documents rather than simply tearing them up.
Secure your devices
Are your smartphone, laptop or other devices password protected? If your password or PIN is compromised, this could lead to devastating losses should someone gain access to your financial information. Do not share your passwords or PINs with anyone. If you think you might forget them and absolutely need to write them down, then store them securely and change them periodically using different passwords for different accounts or devices. Set strong passwords; be creative with your choice and avoid easy-to-guess passwords such as birthdays and names of family members.
In addition, secure your devices with a firewall and security software packages that have anti-virus and anti-spam features. If you are technologically challenged, get an IT specialist or a tech savvy friend that you trust to help you download and install this.
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What’s in your wallet or handbag? Sensitive documents should be kept securely in a bank deposit or a home safe, particularly those with your name and address on them. Make a photocopy of your current cards, driver’s license, and any important documents; these copies will come in handy if you need to cancel quickly or need to order replacements. Have your bank emergency numbers handy so that you can make those calls if you need to.
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Beware of scams
Your bank and other legitimate companies will never request for sensitive information such as bank details, passwords and PINs by telephone or email; these are usually fraudsters attempting to defraud you. Contact your bank directly and report such incidents.
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Do you use public computers?
Avoid using public computers for sensitive transactions as your information could be compromised. If you do use a public computer, be sure to clear your history before you log out completely, otherwise other users can intercept your information. Free wireless internet hotspots are often not at all secure. Use secure websites for your online shopping. The address will usually start with ‘https’ and there should be a key or closed padlock in the status bar. Shop only with trusted retailers.
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What are you sharing on social media?
Do you share personal information on social media, such as your address or telephone number?  It seems so natural to put seemingly innocent information about yourself and your family out there but it makes it possible for fraudsters to authenticate your identity. Geo-tagged photos inform people of exactly where you are; this could expose you and your family to crime.
Even if you put all these measures in place, there is no guarantee that your financial information will be completely secure. However, by protecting yourself, you limit access to sensitive information and protect your personal finances from fraud.
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For more personal finance tips, follow Money Matters With Nimi on Twitter: @MMWITHNIMI and Facebook: MoneyMattersWithNimi

IS YOUR INFORMATION SECURE?

Recently, there has been incessant talk about the National Development Plan (NDP) and how it, as our government so eloquently states, will mitigate the triple challenges that South Africa faces: poverty, unemployment and inequality.
Developmental theory tells us that ‘developmental states’ aim to attain industrialization through active participation in the formulation and implementation of industrial policy, while simultaneously implementing policy to redistribute income to minimize the unequal distribution of income resulting from industrialization.
One of the greatest dangers South Africa faces with industrialization is that the tendering processes in the public sector is corrupt. We cannot have a situation where the benefactors of the industrialization will be those with close ties to government and the ruling party. This would be disastrous for the country and will increase social tensions, while widening the income gap. A good education and healthcare system, which is often entirely subsidized by the government, are key characteristics of a developmental state. The equalization of income is also an important factor, with countries, such as South Korea, being considered among the most equal as well as enjoying the highest living standard in the world.
Bureaucratic competence is essential in ensuring that state institutions facilitate the swift and efficient implementation of the NDP. The state will have to bolster its departments with captains of industry and experts to improve its human capital base. In addition, they ought to be able to attract the brightest young minds and look for creative ways to lure them to the public service as opposed to merely giving them higher salaries. How will the National Planning Committee (NPC) fare compared to successful central planning economic bodies of countries such as Malaysia and South Korea? It remains to be seen. In these aforementioned governments, the state had a more interventionist stance in the economy, coupled with establishing a cohesive relationship with the private sector based on common national policy goals.
A competent bureaucracy is an essential, but not sufficient, condition for a developmental state to thrive. Equally important is the political capacity that will ensure that the state is both accountable and transparent. Unfortunately this is an area that the South African government needs to improve.
Although South Africa should draw inspiration and lessons from the developmental states of the Asian Tiger economies, it should note that the blueprint from these nations is not a one-size-fits-all solution. South Africa’s developmental state will require differing arrangements because no single economy is like another. South Africa is a resource-rich nation, whereas South Korea and Malaysia are more technologically-centric and industrialized economies. Our government should focus on formulating our own unique developmental state blueprint that will help tackle and alleviate our pressing challenges within our distinct African context.
The lack of cohesion between the ruling political party, the African National Congress (ANC), and its communist tripartite alliance is also a cause for concern. Very often the two have stark differing ideologies on pertinent issues such as monetary policy. The South African Communist Party (SACP) previously lobbied for a populist stance of growing the economy by removing the inflation target of 3% to 6% and lowering interest rates to stimulate demand for credit. This will result in inflationary pressures in the long-run and will lead to an eventual economic collapse. The communists often fail to understand that in as much as South Africa has pressing unemployment issues, the loss of employment for those who are already employed will permeate levels of poverty throughout our social structures and place an even greater burden on our social welfare system.
The NDP presents the ruling party with the opportunity to make amends for the lag in creation of jobs and reducing poverty. Perhaps the NDP is exactly what the ANC needs in order to salvage some of the lost faith that has resulted in the emergence of opposition parties such as the Economic Freedom Fighters (EFF) as well as the resurgence of the Democratic Alliance (DA) in last year’s elections.
There is no easy solution to attain economic growth. Placing a nation’s economy on a growth trajectory requires patience and, perhaps more importantly, resilience to astute economic policies.

A lot of work  ahead

In the last two years, a steady decline in the price of gold has brought the operations of many mining companies in Ghana to an abrupt halt. As a result, job losses and a reduction in royalties and tax revenues have been felt. Ghana is Africa’s biggest gold producer after South Africa, and with the mining sector contributing to 5% of Ghana’s economic output, the downturn in the sector has served a serious blow to the nation’s coffers.
Chinese investors, often depicted as parasitic investors, are keen to tap into this opportunity. The Chinese owner of the Akroma Gold project recently completed the purchase of Viking Mines in Ghana for $10 million. There are other new discoveries taking place and, while the sector might not be buoyant now, requisite preliminary studies should be done to mechanize deposits there.
Despite the tough economic climate, gold mining companies are able to meet their obligations, with Goldfields recently paying a $4.5-million dividend to the Ghanaian government and a total of $25.3 million since 2010. The fiscal framework that governs the mining sector in Ghana is a shining example to mineral-rich countries with a porous system due to a lack of transparency and regulation.
The Chinese have pumped billions into the Ghanaian economy. Mining in Ghana is integral to the development of communities; it brings jobs and economic vibrancy. But, for all the synergistic Sino-African trade partnerships being developed, an ability on the part of the Chinese to disregard the honesty and statutes that govern Ghana, especially in the mining sector, raises concerns over whether these agreements are lopsided.
Also, the Ghanaian government’s clampdown on illegal mining has only been marginally successful. Chinese companies use locals to front their mining activity, thus appearing to be credible operations. The lack of rehabilitation done by these companies also further exacerbates the problem. Many sites are left abandoned with no consideration for the environment.
Many large firms neglect their duties to rehabilitate the areas they have worked in, making them inhabitable. Companies, surveyed between 2009 and 2012, failed dismally to keep in line with the environmental protection agency requirements – a damning indictment of the attitude adopted by many foreign firms.
The inability of most locals to get finance to start their own enterprise ensures that development remains at an artisanal level.
Other areas in West Africa are showing promise though. Both Liberia and Sierra Leone are showing signs of reviving their mining sectors. Sierra Rutile is a company that was able to withstand the pressures brought by the Ebola epidemic. They recently raised $44 million to construct a dry mine at Gangama in Sierra Leone. The funds will be used to expand the existing mine. Rutile is used for the production of metal, specifically titanium. The investment will increase production and will provide more jobs.
Another mining company, Aureus Mining, has also signaled its intent to bring a new mine in Liberia into production. With the relative successes emerging in the region, there is confidence being shown by investors to reignite their interests in the mining sector and with it the hope that the sentiment spreads to other countries across West Africa.
The next step for the region is to engage stakeholders to develop concessions and form strategic partnerships. With industry being the buzzword for Africa to reach its full economic potential, the fact remains that infrastructural challenges are still an obstacle. Poor roads affect the transportation of materials. A lack or railways reduces the amount of goods that can be transported. The lack of power is another thorn in the side. The Economic Community of West African States (Ecowas) must integrate by encouraging free trade between the regional countries. By identifying the above issues, governments can make a concerted effort to tackle them.

Work To Be Done But There Is Hope

It was like a scene from a Hollywood movie in the African bush. A helicopter hovered in the bright morning sun before swooping on a patch of long grass. A stocky man in a khaki cap, short-sleeve shirt and shorts, with a cigarette dangling from the corner of his mouth, emerged with a walk to equal the power of his arrival. This is the game auction business. The man was Waltie van der Walt, a game farmer and wildlife breeder in the Limpopo province, in the north of South Africa. In this business, Van der Walt is the lion of the jungle. He strides to the auction through a fleet of Land Rovers, 4&#215;4 double-cabs; the trappings of a multi-million-dollar business.
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In Limpopo wildlife auctions, Van der Walt is a kingpin with a large wallet. He is the founder and owner of Superior Game Breeders (SGB) on the Oorlogsfontein Game Ranch in Mokopane, Limpopo. You could argue he commands auctions as much as bids. Such is his standing that he doesn’t even deign to enter the auction. For the duration of his bidding, Van der Walt merely leans through the doorway.
Chere du Toit, a manager at Aucor Wildlife Auctions, likens him to fellow game buyers Johann Rupert, one of the richest men in Africa, and Cyril Ramaphosa, South Africa’s deputy president. Ramaphosa put game auctions in the news with his attempt to buy a buffalo cow and its calf in Rustenburg, in the North West province of South Africa, in 2012. He lost to farmer, Boet Troskie, who paid around R20 million ($1.6 million). Ramaphosa later apologized to the nation for this attempt at conspicuous cow consumption.
Like Ramaphosa, Van der Walt, found this Saturday, in late March, was not his day. To his chagrin, a young man, bidding on behalf of somebody else, bought the kudu bull he was after. The most expensive kudu bull on the day went for R510,000 (around $40,000). An exasperated Van der Walt hovered off to another auction 30 kilometers away.
“I plan my bidding before I go to auctions. The animals are advertized on the auction’s website, so when you go there you already know precisely what you are after. Needless to say, I went to the auction knowing exactly what I wanted and what I am willing to pay for the animal. It must be within my budget. This was ridiculously expensive,” says Van der Walt later.
Van der Walt also owns Superior African Hunting Safaris, a hunting farm that his son Eli van der Walt manages. They have been in the business since 2001.
Among the 110 bidders who spent millions on the day, was Arie Kuhn, a game farmer in Limpopo, who is also a chartered accountant in Johannesburg. He says the game farmers were stocking up for the hunting season between May and September.
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“We know what the hunters want, so we stock on those animals that are trending. On my farm, we host trophy hunters who are mainly from abroad. Normally they like blue wildebeest because it’s a cheaper animal to shoot. You can shoot it for R6,000 (around $500) and take your animal home. I purchased a lot of them. We also do exotic game breeding in other camps but these are not for hunting,” says Kuhn.
He says his auction budget is determined by his bookings.
Kuhn has been in the game farming business for nine years and grew up on the farms of Limpopo. He brought his two children, Kaylen and Jayden, with him. Jayden, his eight-year-old son, has taken to his father’s passion of hunting impala.
As the auction wore on, the mood was festive at Aucor Wildlife Auctions. Du Toit says that this may not be one of their best days, without saying how much, but seemed satisfied.
In the near distance, in a thatched-roof building, rapped the voice of auctioneer Mike Killassy. He’s in his element and in high spirits. This auction lasted four hours.
“Hammer is up. Can you make it R10,000 ($800) now, sir? Are you happy, can we sell it?” asks the auctioneer.
Killassy, owner of Killassy Auctioneering, has spent more than three decades auctioneering and worked in the United States, Australia and Europe. He says his career’s highlight was being featured in TIME. Killassy was born in Aberdeen, a farming town in the Eastern Cape, to a family with more than 100 years in agriculture. He started as a stock farming auctioneer; these days he is inundated with wildlife auctions. They come up every week in South Africa.
The business has grown enough to attract analysis. Academics in North West University, South Africa, carried out a study. They found game ranching to be a better bet than banking and the stock exchange.
Flippie Cloete, an academic from North West University, says the economic contribution of game farming was close to at least R20 billion ($1.6 billion) in 2014.
Around 29,000 animals were sold at auctions in 2014, making R1.88 billion ($151 million). In total, around 130,000 game animals were traded during the 2014 season. This means a mere 22% of animals were sold at auctions.
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“If we assume that the trade composition of official auctions and private trade are analogous, then the economic contribution from live wildlife trade alone was close if not in excess of R10 billion ($800 million). This is not even considering the economic contribution for services such as capture and translocation, pharmaceuticals, veterinary expense. In addition, the contribution of hunting is estimated to be in excess of R8 billion ($642 million),” says Cloete.
“Game yields higher returns because of the cumulative effect. You have an asset with a reproductive ability. The returns of your investment are not only determined by the change in value of the original animals that were bought, but also from the progeny. If I put my money on stock exchange, or buy a house as an investment, then the returns will to a degree depend on what happened to the value of the shares or the house. However, the big difference is that one share can’t become two or a house can’t become two. But one animal becomes two and so forth. There’s a cumulative effect,” says Cloete.
Van der Walt concurs.
“There’s no comparison between investing in property and wildlife. The animals multiply themselves but property doesn’t. In animals you are guaranteed a 30 percent profit the next year,” he says.
Meanwhile, Andrew Lianos, a chartered accountant at River Group, wants to list wildlife animals on the Johannesburg Stock Exchange (JSE). This has never been done before but he’s convinced he will have his way.
“The JSE does not comment on potential listings in the pipeline. It will only comment once a listing has been confirmed and this confirmation occurs via a SENS announcement as per JSE listing rules,” says Andre Visser, the General Manager for Issuer Regulation at the JSE.
On that sunny day in the bushes of Limpopo, Van der Walt may not have got his way in buying the kudu, but you could argue he has taken the game business by the horns.

Taking Millions By The Horns

Mmusi Maimane – Democratic Alliance leader: It is an insult to them [miners and their families] that three years later, not a single person has been criminally prosecuted or taken political responsibility for the tragic events. The report that was supposed to provide some sense of closure has now called for further investigations. But how many more years will it be before those responsible are held to account? The constitution clearly vests political accountability for the South African Police Service with the Minister and National Commissioner; at the very least former Minister of Police, Nathi Mthethwa, and the National Police Commissioner, Riah Phiyega, should take political responsibility for the events that occurred under their watch. There is something very wrong with a system that allows those who presided over the slaughter to remain in office without any penalties.
Dali Mpofu – Miners’ lawyer: The commission did not look at the underlying issues. It confined itself to the issues of who pulled the trigger and all sorts of technicalities about who was standing where without really interrogating the fundamental underlying issues that caused the conflict in the first place.
Julius Malema – Economic Freedom Fighters leader: While the commission of inquiry had the power and mandate to recommend further actions and persecutions in certain cases, the Economic Freedom Fighters believes that the actions of [Deputy President] Cyril Ramaphosa and Mthethwa had a casual effect on the mass killings in Marikana. We think Judge Farlam did a good job. He did what he was asked to do, although within a short period because of the terms of reference, he did not have an opportunity to dig deep.
Livhuwani Mammburu – National Union of Mineworkers spokesperson:  We welcome the report, but from the beginning we were worried when the strike started. The commission found that the strikers who marched to NUM’s offices did so with violent intent and found that the actions of the NUM can’t be criticized. We welcome the recommendation for further investigation. We maintain that NUM officials and members acted within the parameters of private defence.
Joseph Mathunjwa – Head of the Association of Mineworkers and Construction Union: There is no truth, no justice. I think the commission was made as a gesture not to find the truth. This was another two years wasted. If there is no truth that is unearthed, there will be no healing. This was just a cover up exercise to cover the executives and the blunder of the government.
Zwelinzima Vavi – Former General Secretary of the Congress of South African Trade Unions: I find this insulting and insensitive. A new commission of inquiry must look at the conditions of both work and living conditions. Once the terms of the commission were amended, with the president writing another letter in April reminding the commission of inquiry that it can do everything except to make a finding on the executives, then you must know that by design the commission by Farlam was a fuss. It was never intended to give the victims and South Africa a point of knowing that they now are in a better position because the facts are out and they know who is responsible for all the deaths of the workers that perished. There is no truth, there is no justice… Where is the commission on the fitness of those who appointed them, the President for example? The commission is designed not to find the truth. It is designed to put junior officials as the fall guys.
Mosiuoa Lekota – Congress of the People leader: The moment that the terms of reference were amended to say the commission may not make any findings on the executives is one of the most shocking things that suggest that it was an order not to probe the central issue of political accountability to the people and to the nation.
Gareth Newham – Head of the Governance, Crime and Justice Division at the Institute for Security Studies: The deaths of the miners are unjustifiable. There is no finding that the police were under attack. The four commanders who testified, who stood in front of those members who shot, said they didn’t feel under attack. The police have not showed that what happened at scene two was self-defence.

No Truth, No Justice

As a journalist, I will always remember the evening of June 25, 2015. At 7PM, I was driving in the darkness along the Magaliesberg Mountains, with my eyes trained on the tar of the N4 highway and my ears straining to hear the radio over the engine, towards Marikana the land of despair.
On this night, Jacob Zuma, the President of South Africa, spoke over the radio the findings of the Marikana Commission overseen by retired Judge Ian Farlam. It was a long and painstaking business the FORBES AFRICA team dubbed the Misery Commission.
The Marikana Massacre, between 11 and 16 August 2012, sprang from a wildcat strike, outside the Lonmin mine, along South Africa’s Rustenburg platinum belt, 120 kilometers north west of Johannesburg. Forty-four people, including miners, security guards and police, were killed.
It was on May 14, 2013, nine months after the massacre, when I first laid eyes on this hill where people died. It rang with the chants of thousands of miners on another wildcat strike. The protestors littered the hill, dressed in the green of the Association of Mineworkers and Construction Union (Amcu) and carrying knobkerries. The atmosphere was tense as they marched to the Wonderkop Stadium, a kilometer away.
I remember asking journalists then, where they had been when the gunfire started on August 16, 2012? They would point, like hounds to a scent, at patches of dirt etched in their memories. The spots where they dived for cover from the gunfire that brought an end to the lives of 34 miners.
On June 25, 2015, as the report outlining that day was released and the expected portion of blame given, the night air held a deafening silence. I remember jumping out the car, opening the boot and shivering to set up a tripod and camera. The hill was cold and barren under the starry sky.
We drove around the township searching for people who had been listening to the broadcast. To our disappointment, many that were awake did not watch, or even know the report was being released. On this night, Bongikhaya Ndumndum, a former pipe maintenance worker at the mine, was in his home on the corner of the township, meters away from the quiet hill. He didn’t hear the news.
“I remember the police being here. When the police started shooting I ran,” recalls Ndumndum.
The Commission sat for 300 days, ringed by journalists from around the world, in the heart of Pretoria. Among suits, laptops and lever arch files were the truths of how the massacre happened.
Farlam’s 600-page document was summarized by Zuma in 24 minutes.
The report absolved a number of key players. Deputy President Cyril Ramaphosa, a shareholder of Lonmin, who allegedly sent an email to other shareholders to deal with the problem; Minister of Women in the Presidency, and former Mining Minster, Susan Shabangu; Minister of Arts and Culture, and former Minister of Police, Nathi Mthethwa; and Joseph Mathunjwa, the Head of Amcu, were exonerated.
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Others, according to the enquiry, did not easily escape. The Commission recommended a full investigation into the criminal liability of all the members of the South African Police Service (SAPS) involved. The killings and assaults prior to August 16, 2012, should be referred to the Director of Public Prosecutions‚ for further investigation.
The Commission also ordered a probe in National Police Commissioner Riah Phiyega’s fitness to hold office. Both the National Union of Mineworkers (NUM) and Amcu are accused of not exercising control over its members and endangering bystanders. Lonmin is accused of failing to comply with its housing obligations, which created the environment to begin the strike.
It also issued that a panel should revise the strategies of public order policing within SAPS and implement proper protocols to best dissolve violent clashes. The SAPS training methods were proved to be inadequate and should be revised, including basic first aid training.
It was not closure for all. As the night stretched on, we found a group of journalists who had returned from inside the iron fences of Lonmin. In a small TV room, the families of the victims and their legal representatives waited anxiously for the findings, but by the time the president had finished, the mines had not set up the TV, a small but telling irritation for the families.
Just another cold night on the fields of the Misery Commission.

The Slaughter Of 34 Miners That Shocked The World

David Sipunzi’s election to the top job of general secretary in the National Union of Mineworkers (NUM) was as low key as the man himself. He scraped in by nine votes against a man who had held the post for 10 years, Frans Baleni. Apparently, many in NUM felt the gentlemanly Baleni may have been too gentlemanly in dealing with the mining bosses.
The soft-spoken Sipunzi, a 54-year-old father of four from the small town of Willowvale, in the Eastern Cape, is a former underground miner. He was one of the first to join NUM when it formed in 1985. He spent decades as a union organizer, latterly in the Free State, and is seen as a radical.
“Sipunzi looks a bit like a deer in the headlights following his unanticipated election over the weekend. He has been suddenly foisted into the national spotlight with a swirl of contentious issues around him,” wrote journalist Ranjeni Munusamy, in the Daily Maverick.
Thapelo Tselapedi, a University of Johannesburg academic and political commentator, says Sipunzi was not a well-known candidate and his victory was a surprise.
“It is still early days to say Sipunzi and the new leadership will change the fortunes of the trade union. But for the new leadership, the task ahead is the unity of the federation (Cosatu). This could be the starting point to turn around things in the Tripartite,” says Tselapedi.
The Tripartite Alliance, comprising Cosatu, the federation that NUM is a member of; the African National Congress and the South African Communist Party, has been unsettled by divisions.
The first job for the new big man in NUM was to rally the troops at Westonaria Sports Complex, near Krugersdorp, west of Johannesburg, in late June. The union said there was going to be 3,000; less than a 1,000 turned up in the region that pushed for Sipunzi’s election. A fitting debut for a low key man.
On this day, the question was how NUM is going to stop the exodus of members – 100,000 to other unions in 10 bruising years in the mines. The former undisputed champion of the union movement is in danger of being knocked out by the militant streetfighters of the Association of Mineworkers and Construction Union (Amcu).
Prompted by his small audience’s warm applause, a calm and resolute Sipunzi took to the podium. He preached unity and radical recruitment.
“This situation is sad; we are very scared of it… Losing members means losing money. A union is strong when it has its own money. Let’s not use the excuse that the mines are closing down. We must look elsewhere for new membership. We must recruit in the construction sector, but we are lazy,” he says.
It is a search and fight against indolence that could decide the future of the most powerful union in Africa’s biggest mining industry.

Can The Deer Stare Down The Headlights?

The Birchwood Hotel in Boksburg was an apt choice for these talks for two reasons: firstly, Boksburg is a mining town built on the digging of gold; secondly, it is a venue for boxing and home to former world heavyweight champion Gerrie Coetzee. The Friday before gold mining pay talks began in earnest, on June 16, there was a boxing tournament at Birchwood. At least the Friday fight night was fought under Queensberry rules.
The Association of Mineworkers and Construction Union (Amcu) led with its left. It may be merely the second largest union, representing 30% of the 93,000 gold miners compared to the majority National Union of Mineworkers’ 54%, but what it lacks in numbers it makes up for in chutzpah.
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“We are a serious union,” says Manzini Zungu, the spokesman for Amcu.
When the major gold producers in South Africa, the leading gold producer in Africa, made one of the best opening offers in history on July 6 – of between 7.8% and 12.96% – Amcu was the first to despise it. To rub salt in the wounds, in rejecting the offer, Amcu presented slides showing the salaries of the top mining bosses, of up to $1.7 million a year, juxtaposed with the salaries of underground miners.
“That was brilliant,” says an official from a rival union as he emerged impressed from the negotiating room.
“You can’t compare a CEO to a man who carries a shovel,” scoffed another.
Amcu put pressure on the gold employers to make a counter offer two days later. The employers stuck to their guns and Amcu deadlocked on July 8, taking a dispute to the Commission for Conciliation, Mediation and Arbitration (CCMA), the independent arbitration body. It was enough bad news to drive the value of mining stocks down by 10% on the day on the Johannesburg Stock Exchange.
The next step is a strike and Amcu proved, in 2014, this is not too difficult. In that year, the union took the platinum mines out for an unprecedented five-month stoppage that cost more than $2 billion.
“The problem is the employers fear Amcu,” says a former member of the NUM negotiating team.
The rest of the unions, NUM, UASA and Solidarity, stayed at the negotiating table but are equally disgruntled.
How the gold employers are going to close the gap, with pay demands that go up to 80% from NUM to 100% from Amcu, is anyone’s guess.
The employers plead poverty. Figures released by the Chamber of Mines show the demands would load R16.5 billion ($1.32 billion) onto the wage bill of South African gold mines. The wage bill, in 2014, was R23.5 billion ($1.88 billion), making up 55% of gold mining costs.
“If all of the wage demands are granted, nearly all of the mines in South Africa would be under water. It could be the end of the gold mining industry,” warned Elize Strydom, the chief negotiator for the employers.
The employers also set great store by what it calls social compact – a package of pensions and welfare benefits to complement the pay. Like the opening offer, this too fell on stony ground.
“We don’t want packages, we want pay,” says David Sipunzi, the general secretary of NUM.
The employers also tried to link a pay deal to profit share if the gold price goes up. They promise there will be bonuses if profit margins, after costs have been deducted, stay above 6%. Clearly, there will be talk about retrenchments and pay cuts if profits turn to losses.
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“Will the bosses take a pay cut?” asks one of the more cynical officials at the talks.
The unions’ argument is simple. They want to use these talks to close the pay gap between the boardroom and the bottom of the damp shafts, miles underground where the gold is.
You could argue that a secretary answering a telephone in an air-conditioned office in Johannesburg earns twice as much as a miner who spits and sweats in the clammy heat, more than four kilometers underground for as little as $600 a month.
Amcu and NUM also want to close what they call the “apartheid gap” in pay – a legacy from the old days when the cheap labor of black miners made vast profits for both the mines and the state.
“We don’t fear the threat of retrenchments made by the employers, they are retrenching at Doornkop (a Harmony Gold mine) as we speak,” says Sipunzi.
Analysts have warned rising costs and falling productivity in the gold mines could cost the industry 20,000 jobs before the end of the year. The number of workers in the gold mines has fallen from 180,000, 10 years ago, to a mere 120,000, an alarming decline in a nation that has mined nearly half of all of the gold in the world.
The only jab in the eye for Amcu so far is its dismal attempt to boost its numbers represented at the talks. It claimed an extra 6,500 members, but independent auditors say 6,000 of those could not be verified. A source among the employers says of the 1,000 members claimed at AngloGold Ashanti, a mere seven turned out to be true.
What is clear is that whichever of the two main unions, Amcu and NUM, is seen to get the best deal in these talks will attract a legion of new members to their corner. Seconds out.

Gloves Off In Gold

With all the excitement and anticipation that comes with holidays it is so easy to overspend. Here are a few tips to manage your holiday finances and still have a lot of fun.
<h4>Plan ahead</h4>
By booking early, there is time to shop around for the best deals on fares, accommodation and tour packages. If your plans aren’t already in place, you will have little flexibility and will have to accept whatever is available. Last minute bookings can cost you much more than if you had booked weeks, if not months, in advance. This can get really expensive particularly for a large family.
Air miles are useful in offsetting some of your ticket or accommodation costs. However, it is a challenge to find air mile tickets during peak periods.
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<h4>Draw up a holiday budget, and stick to it</h4>
You do not have to travel to an expensive and exotic location just because everyone else is doing so. Set an overall spending limit involving your family and try to stick to this. You will need to budget for the various aspects of holiday spending. Avoid borrowing to finance a holiday unless there is some certainty of an impending inflow of funds or other compelling reason to do so.
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Credit cards, debit cards or cash?
If you plan to use your cards while you are away, notify your bank or card company; as an added security precaution, many card providers look out for suspicious activity and your account may be suspended until they have confirmed that it is indeed you using the card.
As far as possible, use your debit card for withdrawals at ATMs during bank opening hours. Always hold some cash just in case your card is lost, stolen or fails to work.
Licensed bureau de changes are usually available at airports; this is very convenient particularly when you arrive, but they tend not to be as competitive as those in town. Also, be cautious when you patronize moneychangers, as there is the risk of being shortchanged or sold counterfeit money.
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<h4>Beware of roaming charges</h4>
The new-generation smart phones provide us with instant access to the internet. We thus unwittingly leave ourselves open to exorbitant international roaming charges. The continuous activity as soon as we switch on our electronic gadgets utilizes data, leading to constant charging and a shocking bill when you return home.
Fortunately, smartphones have a range of options and you can choose which services to switch off. After disabling data services, you can still make and receive calls and send and receive text messages. In addition, you can turn this feature on and off,  so you can still check your emails periodically.
You will have access to Wi-Fi hotspots at internet cafes and your hotel. Use ‘free’ hotspots with extreme caution, particularly for transactions; they may be convenient but are not always secure and you could be compromising your sensitive information. Reduce your vulnerability by using strong passwords and security software.
It makes sense to buy a local SIM card when you arrive at your destination, making calls will be much cheaper than using your usual number.
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<h4>Are you insured?</h4>
While vacations usually go without incident, you don’t want to be caught unawares. What if someone in your family suddenly becomes ill? What if your luggage gets lost or you have to cancel your trip? Travel insurance usually includes coverage for medical bills, lost baggage and cancellations. Read the fine print to ensure that you have the best coverage at affordable rates and make sure you have your medical insurance card.
Above all, remember that a vacation is really about spending quality time with loved ones, resting and having time for yourself. It doesn’t have to be expensive; you can rediscover your own environment by visiting places close to home, revisit your hobbies, pastimes, and sports. With a little careful planning, you can find a balance between having a holiday and still keeping your finances in check.
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For more personal finance tips, follow Money Matters With Nimi on Twitter: @MMWITHNIMI and Facebook: MoneyMattersWithNimi

Managing your holiday finances

In the United States, 60% of the country’s employment is said to be created by family-owned businesses, though Ted Clark, the executive director at the Northeastern University Center for Family Business, believes this to be an exaggerated estimate. Despite this, family businesses are significant to job-creation, which is why it is important to understand some of the risks that come with them.
From the golden arches of our local McDonald’s, to the swiveling rims and the muscular lines of the latest BMW, we see some of the manifestations of enduring and pioneering multi-generational family businesses. But, the road to success if often paved with threatening challenges and temporary misfortune. Pitfalls such as financial turmoil, hostile takeovers, fraudulent misdemeanors and corporate scandals often plague family businesses.
Most family businesses dislike the idea of incorporating a formal structure to their business as it grows. Such structures would imply tedious forms of communication that may be placed under scrutiny by non-members of the family. Despite this, such a structure would ensure better organization, the avoidance of miscommunication, more profitability and clearer job tasks. One of the reasons many small family businesses lack structure is because they were founded without a business plan. Maintaining conflicts of interest is another tricky aspect of a family business, especially if it operates with a human resources department. Most family-business consultancies recommend that there be no direct lines of communication between relatives.
Family dynamics and business structure do not necessarily work together. In most cases, disagreements in family business stems from an overlap between family dynamics and the structure and policies of the company. Unresolved issues in a family tend to spill over into the business environment, which may stagnate the growth of, or even the continued existence of, the business. Other causes may be the lack of definitive roles that each member is required to respect. Crossing the boundaries of one’s role and assuming unsolicited authority over areas of the family business may prove detrimental to relationships within the business and unproductive to employees. Another common problem is the lack of transparency for non-family employees regarding payment structure, decision-making and career progression.
According to a report, publically-listed family businesses were found to have performed better than non-family businesses during the recessions in 2001 and 2008. Many family businesses fail to make it to the second generation owing to unresolvable family disputes, resisting or ignoring change, poor succession planning and failing to adapt to the latest business and market trends. What may have worked for the founder of the business, may be damaging for the loyal successor. On the other hand, contrasting and conflicting views on how the business must be run is a common cause of failure. Like in any company, a clear and shared vision is required to ensure that all members are working effectively towards the same goal.
The big N-word that most family businesses hate being associated with is nepotism. This is a word that usually sits at the tip of the tongue of a disgruntled employee who may have been sidestepped for a promotion that was given to a less experienced family member.
In some cases, working in a family-owned business may mean limiting your sights to positions that will never lead you to the coveted position of CEO or chairman, often reserved for the company’s blue bloods. It may be in the best interest of some family businesses take a page from the family that founded the LEGO Group. The company chose to ensure the longevity of their business by promoting the first non-family member to head their eponymous toy dynasty in 2004.
While many family businesses come with their complications, it is important that these issues are discussed openly between family and non-family members to ensure the health and growth of a business that intends to grow beyond the first or second generation.

Perils Of the  Family Business

The performance of African markets was strong last year, with money raised by companies doubling to $10.9 billion. Buoyed by a 40% jump in terms of volume of offers, 2014 saw the highest level of activity in African equity capital markets (ECM) over the previous five years, according to a PricewaterhouseCoopers (PwC) report: IPO Watch Africa 2014.
The report showed a total of 90 initial public offerings (IPOs) which raised $6.3 billion between 2010 and 2014. Secondary offers, on the other hand, raised a total of $31.1 billion, representing 83% of the total capital raised and 27% of the transaction volume in the same period. The resurging interest tops a five-year high, recorded in 2010, when African exchanges raised $7.6 billion in fresh equity capital.
Growth in the size of the capital markets highlighted the shift from commodity-based to a broader range of sectors, most notably financial services. During the 2010-2014 period, financials accounted for almost half of the companies raising new capital. Last year, this figure stood at 57%. Within the same year, four out of the top 10 IPOs by proceeds were financial stocks, according to Dealogic, an international financial services information provider.
The report also revealed a new trend – the growth of regional stock exchanges. The research indicated a greater share of capital was raised in markets outside of South Africa, which itself accounted for only 32% and 44% of total IPO capital raised in 2013 and 2014 respectively, a departure from its more prominent position in previous years. Last year, money raised by companies on other African exchanges increased by 66% to $1 billion compared to the previous year. However these stock exchanges still have a long way to go. In the five-year period under review, the Johannesburg Stock Exchange (JSE) accounted for 78% and 64% of capital raised and transaction volume respectively. Ranked first in the world by the World Economic Forum’s 2014-2015 Global Competitiveness Report for its regulatory framework, it is easy to see why the JSE continues to dominate the Africa’s capital raising landscape.
Most notably, a number of the top 10 IPOs in the past two years had an international component, either foreign companies raising capital directly on African exchanges, or African companies marketing shares to international investors through dual listings or sales to qualified institutional buyers abroad. Since 2010, nine African companies have listed outside the continent, raising a total of $370 million while only one non-African company listed in the continent, raising $107 million. This trend highlights an increasing global integration of businesses in the region and the interest of international investors in Africa.
Regional exchanges need to continue building on the strong momentum of last year. Already, 2015 is shaping up to be a positive year for equity capital market activity in Africa. Nigeria has recorded two capital raisings in January alone; an IPO and a secondary offer. Ongoing harmonization of regional exchanges and liberalization of capital markets through legislation are necessary to keep the momentum going. This is essential to uphold investor confidence and attract new players, such as the private equity funds. To date, the most common means of exiting these funds has been through a sale to corporates, which accounts for about two-fifths of exits, according to the African Private Equity &amp; Venture Capital Association.
Furthermore, improving social conditions, rising urbanization and the adoption of new technological advances are important factors in driving regional exchanges forward. These transformations must be matched with political stability and more effective economic and fiscal policies in order to deliver stable regional exchanges. In addition, improving liquidity and quality of information is crucial. The latter has been blamed for international public companies being hesitant to list on African stock exchanges and foreign investors investing in domestic listed companies.
No doubt, as these measures are steadily implemented, Africa’s rise in the international capital markets is assured.

The Rebirth Of Africa’s Capital Markets

The current spate of opportunities in the Nigerian mining sector is predicated on a true spread of federal powers. Potential investors must be hoping that newly-elected President Muhammadu Buhari gives the mining sector the much-needed attention it deserves.
The sector has been neglected with swaths of red tape preventing it from developing. Crucially, if the mining sector is to succeed then the recently privatized power sector is integral to its success. Ask any Nigerian about the problems they face on a daily basis, you will find it hard to find one who won’t mention the infamous power outages.
When those concerns are transferred to industry it deters any serious mining activity taking place. Unless a mining company develops its own independent power plant it is highly unlikely that Nigeria will be considered as a mining hub despite its mineral wealth. Erratic power supply does not encourage mining companies that want to increase profits while decreasing production costs, especially when commodity prices, such as gold and iron, are trading at record lows.
Having spent the last year as Africa’s biggest economy and touted to have the 19th biggest economy in the world by 2030, Nigeria is expected to employ robust resource governance in accordance with international best practices. India has implemented a policy of backwards integration which has been met with success. Industrial behemoth, Jindal Steel &amp; Power, is a glowing example of how backwards integration can result in financial growth for a company.
It would be remiss of me to not commend the efforts of the previous government to transform the petroleum industry with the proposed Petroleum Industry Bill. Although delayed, it was a sign of the government’s willingness to change what has been a mismanaged government sector. The mining sector has until now failed to develop a legal and regulatory framework that will keep up with international best practices. Like an unwanted puppy, it struggles for care and attention. Instead it is neglected and imposed with an archaic tax regime.
The government must impose trade tariffs, as seen with the ban on the importation of poultry products to entice prospective participants. Additionally, fiscal federalism is necessary so that powers are devolved to the state. At present, the constitution states the federal government owns all resources.
Opportunities in the mining sector are vast due to the untapped deposits that are yet to be mined. Furthermore, the prospect of backwards integration allows for companies to effectively manage their resources.
In its ability to harness an effective framework, Ghana recently hosted a delegation from Zambia to advise the country on how to manage its resources. The government is also talking to the 13 multinational mining companies that operate in the country over the possibility of embarking on underground mining operations.
No man is an island. Despite its economic prowess, Nigeria must seek the help and advice of other countries with developed mining industries. Just like Ghana sought help from Nigeria about managing its oil production, Nigeria must extract knowledge from Ghana as to how to run its mining sector efficiently. Mistakes of the past should not be repeated. Nigeria also needs industrial stakeholders to promote, research and develop the mining sector.
Nigeria does not need to import raw materials for many of its industries. The ingredients can be found in the deposits scattered across the 36 states, all of which can be used as agents of change to satiate local and international appetite for finished products. This is added value but it something that is proving difficult to harness due to porous infrastructure.
If talk is cheap, then the labored rhetoric of diversification without the expense of action will prove costly in the long run.

The unwanted Puppy In Need Of Rescue

Apaltry rate of investment in infrastructure has dimmed the otherwise bright future for our continent.
Decades of self-serving economic policies, political agendas and some may say cynical or ‘feel good’ aid flows to Africa clearly have not delivered much. Yet, there is a new sense of enthusiasm and positive energy from Africa. The new generation of Africans is seizing the future.
The people are moving and the opportunities are endless for Africans. Entrepreneurs from around the world are engaged, but the picture has flaws; the story is oversimplified. The basic needs are still missing. Where are the ports and harbours, railways, roads, power plants and electrical and water distribution to support growth?
It is Africa’s diversity that makes it so rich, but it is also this diversity that remains the biggest hurdle to the growth that is eagerly expected.
Africa comprises 53 diverse countries – historically impacted by colonial era and cold war foreign ideologies; diverse languages, inefficient bureaucracy, nationalist inward-looking focus and economic protectionism. The continent often lacks experience when it comes to major infrastructure delivery and attracting private sector or foreign development investment.
Enter the World Economic Forum (WEF) and many other NGOs and Develop Finance Institutions (DFIs) who seek to usher in a better world.
WEF is a private institution respected as an influencer and incubator in helping the world understand the future.
The focus on Africa, in the last decade, has done good and raised the economic profile of the continent around the world.
WEF has no implementation resources or infrastructure delivery capacity but are good at investigation, evaluation and think-tanking. Ideas may abound but when does planning turn into delivery? Many highly qualified professionals with great ideas meet annually with apparently limited visible progress when it comes to the hardware on the ground.
In 2013, WEF stated that “with an expected annual growth of 5 percent in 2012-2013, sub-Saharan Africa continues its transformative journey from a developing continent to a hub of global growth. According to the World Bank, almost half of Africa’s countries have attained middle-income status. At the same time, the continent’s positive outlook is threatened by fluctuating commodity prices, rising inequality and youth unemployment.”
At that session, much time was spent on the identification of target and priority infrastructure projects and 51 were shortlisted. The work done on the projects list was commendable, but there were crucial missing factors preventing the realization of the funding and construction of these projects.
The ability to attract large scale DFI funding to the extent required, which is put at $75 billion by 2040, is still elusive due to three factors: the absence of upfront ‘at risk’ funding of early project feasibility studies that can attract full project funding from private, public and DFI sources; a lack of political will and technical knowhow.
At this year’s forum, it’s encouraging to see all three of these key factors firmly on the agenda. There is a realization of the need to have a regional integrated view and that non-returnable funds are made available, to enable project preparation to be effective which will lead to funding and implementation.
My birthplace in Zimbabwe and my own personal African infrastructure adventure, over the last 30 something years, has given me valuable first-hand experience of the immensely difficult task of getting major projects through to implementation, both from a private and public sector perspective.
My personal experience with WEF goes back to the event in Cape Town in 2010. I attended with a special interest in the economic growth drivers and capacity building within Africa’s infrastructure.
In a number of DFI forums, my colleagues and I stressed that while projects may be much needed, project financing funds will not flow unless there were crucial additional funds made available that paid for the early detailed feasibility studies, including the designs and accurate technical scoping, budgeting and funding mechanisms and ultimately project management.
At last, we may be seeing the DFIs and the many agencies seeking infrastructure solutions for Africa coming together to get the African vision moving.
WEF would have thus played a strategic role in unlocking the potential. Africa is waiting.

Africa Is Building At Last

It was the dual meaning of a few words that tripped off the tongue of the Somaliland foreign minister as he talked about the economic future of Africa that turned my blood cold.
“Africa shouldn’t miss the boat,” says Mohamed B Yonis.
The stark image that stabbed into my mind was that of Africans risking their lives on leaky boats crossing the Mediterranean in the desperate hope of a new life in Europe – a journey that has taken 2,000 lives this year. A new life? The odds are against it; even the survivors are likely to end up as sweated labour at best; trafficked labor at worst.
I was even more upset to see a magazine at the conference with a survey suggesting a large number of Africans say they would risk the tricky crossing of the Mediterranean even if it cost them their lives; a sad statistic close to the weeping heart of Africa.
A sobering thought amid the gathering of the rich and powerful in Cape Town where there were many signs of light and growth in Africa. Among the 1,200 delegates were investment fund managers from across the world.
“We like what we see and are here to invest,” says one partner of a $68-billion New York investment fund.
Infrastructure is likely to be the big business of the future; in the past, the World Bank estimated Africa needs at least $93 billion a year spent in infrastructure. Those in the know in Cape Town say this is barely enough to touch the sides of the infrastructure gap.
Former head of South African intelligence, Moe Shaik, has been doing his bit with the pan-African investment operation he is running for the Development Bank of Southern Africa (DBSA). Shaik says he gathered $404 million (R5 billion) in investments into everything from roads to oil and gas pipelines in the last year. Shaik also says the DBSA contributed $150 million in raising $750 million for a sovereign wealth fund in Angola that will be used to build roads and infrastructure as well as making plans for a new coal fired power station at Mamba, near the Zambezi River, in southern Zambia. He believes state coffers can no longer afford infrastructure.
“Government needs to create an environment where capital can come in and build. But African governments also need to set up mechanisms where they can supervise infrastructure projects in their country so they can be done properly,” he says.
Patrice Motsepe, Africa’s 14th richest man, worth an estimated $2.3 billion according to FORBES, agrees.
“I have always emphasized that we need to bring the private sector in and that the partnership be a partnership between the government, the investment communities, both local and international, and that always gives me comfort that these projects make sense, that they are sustainable,” he says. “The environment has been put in place and we are making progress in Africa in comparison with various other investment countries.”
The head of state in the host country, South Africa, believes the continent is well on the way.
“There is the issue of infrastructure, all types of infrastructure that is actually changing the face and the landscape of the continent. This is what we are attracting. Those huge sums of money; we were therefore discussing the financing of these projects, how ready the projects are; some of the projects have been presented and are now ready to be financed and there is an interest of all financing institutions both locally and internationally,” says President Jacob Zuma.
With the optimism in Cape Town came caution. There are still doubts about political stability and corruption. Now, I have heard corruption compared to many things down the years, but never to crocodiles in the Kenyan bush.
“You know, when wildebeest migrate north to greener pastures in the Masai Mara game reserve, the crocodiles lie in wait for them in the rivers. So the wildebeest have to know where to cross otherwise they are going to lose a leg. The crocodiles are corruption,” says Bharat Thakrar, the head of East African advertising giant, Scangroup.
“It used to be limited to the police and small government offices, but now corruption is creeping into private business in Africa.”
Blair Glencorse, is fighting corruption with his NGO Accountability Lab in Liberia and was at WEF Africa.
“Where there needs to be enforcement, the key issue is to make sure it is part of a larger strategy to build transparency, open up information and build channels of exchange between citizens and governments – so it is not politicized. There are countries of Africa which are making some progress along these lines like Botswana and Ghana,” he says.
Hope and crocodiles collide; Africa has its work cut out before WEF Africa in Rwanda next year.
<h4>The Fresh Face of $2 Billion</h4>
Africa is changing fast and has a fresh face. Ten years ago, it would have been unthinkable; 20 years ago, unimaginable in an often patriarchal Africa. One of the freshest, not to mention powerful, faces at the World Economic Forum (WEF) on Africa in Cape Town runs $2 billion in investment at the age of 38.
Ngugi Kiuna grew up in Nakuru in western Kenya, the son of a managing director of a company selling tractors and a mother who sold animal feed. He went to boarding school in England and studied chemical engineering at Imperial College, London, before earning a PhD in composite structures of aerospace applications.
In August 2013, Kiuna became the head of investment banking for Africa at Rand Merchant Bank. He runs $2 billion in assets in Nigeria, Kenya, Namibia, Ghana, Lesotho, Swaziland, Tanzania, Zambia Angola and Botswana.
“Most of the countries we deal with are single B rated by the risk people. We also do a lot of work with private entities. The sovereign element is there and if you have it there is less of a risk. The sweet spot for us is three- to five-year investments. Off our own balance sheet, we can do longer, with the support of development finance, up to 10 years,” he says.
It means Kiuna oversees the financing of aircraft for Air Namibia, the building of roads in Angola and investment in locomotives in Mozambique. It is investing in Cenpower – a new 300MW gas power plant – in Ghana. In Kenya, it has helped tie up a deal, this year, to plough $350 million into a new 450-kilometer oil pipeline between Mombasa and Nairobi. It will take over from the old pipeline that’s been pumping oil since the 1960s.
Most of the people Kiuna meets, in his extensive travels across the continent, are old enough to be his father.
“I was with the minister of finance in Gabon, we were talking about the government infrastructure plan and strategy about borrowing, you could see all along there was something in his mind he wasn’t comfortable with. I said ‘minister, I know I look too young…’ He burst out laughing. I said I am not as young as I look, it broke the ice. After that, the nature of the conversation changed,” he says.
“I think people are generally embracing but obviously some are surprised by how young I am, but people are much more open minded to the younger generation. I think it is also a function of the technology age, you have younger people becoming billionaires these days.”
At WEF in Cape Town, Kiuna rubbed shoulders with many others with billions to invest.
“We saw there is continued buzz and interest in Africa; a lot of new people, new faces and new companies ready to invest. There is also a lot more intra-Africa dialogue; people talking about projects, people collaborating on projects. The amount of trade in Africa is nowhere near what it should be. Thirdly, power in Africa, we need to get that right and let’s hope we can. There have been power projects too big and too complicated to execute. So, we need to scale down projects to a size where it’s easier to be financed and done.”
His greatest fear for Africa?
“Political stability and transparency; these are all matters we have to get right… The biggest fear is around transparency around elections cycles in Africa. The recent elections in Nigeria, Kenya, Zambia and Namibia show we are getting there.”
“Wherever I travel on the continent, I am always inspired by the number of people who have started their own business. I dedicate what I do to them.”
Words wise beyond their years.
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Crocodiles,  Money And Hope

Before money was invented, before the word entrepreneurship was formulated, people in ancient times traded by offering value. As far back as the Stone Age, people had to transact by exchanging goods that were of equivalent value to what was  to be received.
Today, this concept can be described by two words: value proposition. This has gained currency over time, but some entrepreneurs still miss the mark.
Business is based on the following basic principles; you are either saving your clients time and money, or making them more money. In supply and demand, distribution comes as a value-added product.
Geographic proximity to a product does not mean others have the same advantage. Cocoa is a good example. The product is largely found in West Africa. Any entrepreneur setting up a distribution channel to Singapore will be adding value on two fronts; firstly that area of Asia doesn’t have in the same abundance of cocoa as West Africa, and secondly from the logistics front.
In the knowledge economy, access to rare information elevates the value of those who have it. This is why companies call in consultants and advisors at an inflated cost. It is also why we keep going to conferences, paying international speakers large amounts of money to speak for 30 minutes. It’s all about the value one can bring to the table, and that comes from experience or study.
Scarce skills, like firewall experts, are rewarded handsomely, as cyber security threats rise. A shortage of something increases its value; art collectors can attest to that.
Marketers use this strategy to create a craving for a product and service. You are unlikely to see a Bugatti advertised on billboards and in newspapers. People who can afford the supercar know where to find it.
Entrepreneurs need to reprogram themselves to create value, rather than looking for money. Money chases value. No one holds a monopoly on cash; if you offer customers value, they will gladly give you their money.
Even Albert Einstein, a man of science rather than business, said, “Try not to become a man of success. Rather become a man of value.”
There are survivalist entrepreneurs who keep complaining as if money repels them. We need to be innovative in how we sell our products and services. The market will pay for the value you provide.
Jannie Mouton is well known for creating value. He did something unique through Capitec Bank. They entered a market which had gigantic financial institutions; they added value through two things in particular. They lowered bank charges and demystified the banking system. This related to the general population, most of whom were clients of other banks. Today, Capitec is one of the largest retail banks with four million clients, and they claim to be registering around 100,000 new clients every month.
Adding value is reliant on the industry that the entrepreneurs find themselves in. You need to make promises to clients that differentiate yourself from your competitors. You have to appeal to what they want. The successful execution of this can convert prospects into new customers.
While you are trying to make millions, never forget that at some point almost everyone in Zimbabwe was once a billionaire. It’s not really about the money, it’s about the value that you add through your company. Align yourself with a sense of value, then all these others things will fall in place

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