After a decade studying and working in Australia, Swazi-born Roberto Russo had just been granted citizenship when he took a phone call from his father in Swaziland. The telephone conversation was to change his life’s trajectory overnight.
“I never thought of coming back to Swaziland. I was happy in Perth. But when my old man said to me he was thinking about selling the business I thought ‘what is the worst that can happen?’ I can always go back to Australia. I have not looked back,” says the 35-year-old Russo.
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The lay of the land for entrepreneurs in Swaziland and Australia are poles apart. Australia is an open democratic society with a large middle class customer base, government support for emerging businesses, and perched on the doorstep of Asia’s huge and burgeoning economies.
Swaziland is an undemocratic feudal society ruled by sub-Saharan Africa’s last absolute monarch, King Mswati III. It has a population of 1.3 million, the majority living in poverty, unemployed or practising subsistence agriculture, and a government actively favoring international and local corporations at the expense of small and medium enterprises.
To compound its reputation as an entrepreneurial backwater, Swaziland’s tentative claim to being a stepping stone between the economies of South Africa and Mozambique is wishful thinking at best.
In reality, the construction of world class road infrastructure between the industrial and business hubs of Johannesburg and the port city of Maputo has left Swaziland out of the loop. The South African city of Mbombela boomed at Swaziland’s expense by servicing the trade route.
Swaziland’s national economy is habitually mismanaged for the benefit of Mswati and his expansive royal household and was one of the factors resulting in the country flirting with a financial meltdown in the wake of the global recession in 2008. A lifeline of a $335-million loan from neighboring South Africa was refused as the fine print included political reforms. Financial oblivion was only averted after the Southern African Customs Union (SACU), discovered that Swaziland, as a customs union member, was eligible for an $88 million windfall in 2012 and it came with no strings attached.
The financial crisis was caused by a drop of more than 50% in SACU receipts as a consequence of the recession and squeezed Swaziland’s public sector wage bill that accounts for about 18% of the approximately $4 billion GDP – the highest ratio on the continent.
Russo was clearly looking through a different lens at the business opportunities that existed when he decided to return home in the midst of the country’s financial crisis and swing for the entrepreneurial fences. In the eight years since buying out his father, his businesses have grown eightfold to record a $10 million annual turnover. Russo’s stable includes a paint manufacturer, tool supplier and advertising firm.
Swaziland’s proximity to Mozambique has proved an advantage against Russo’s South African competitors.
“We export seven to eight tons of paint daily to Mozambique. Purely on geography we are able to load two trucks in the morning and make delivery and they are back by 5PM,” he says.
Sandwiched between two countries allows for different business strategies for each, while also benefitting from lower water, electricity and labor costs. Mozambique provides for bulk paint sales, while the South African market offers a niche that sidesteps the competition from South Africa’s thousands of paint manufacturers.
The company supplies specialized paints to a Johannesburg-based architectural firm, including insect repellant paint for malarial areas and paint that can be applied in wet weather.
“We are small enough to be able to custom-make our product to fit client needs… the bigger guys would ask ‘look, how big is the project?’ and it would not be worth their while,” he says.
“One of the downsides of being such a small, isolated country is that you get comfortable at what you are doing, even though you do it well. It’s important to attend tradeshows and ensure we remain current, to give us a competitive advantage.”
Technical staff recruitment can also be difficult.
“There is only a small pool of paint chemists that you can get hold of in southern Africa… but people are quite naive. People in South Africa think that Swaziland is a small little farm town. People that do know the lifestyle we live in Swaziland would come at the drop of hat.”
Swaziland’s formal economy is dominated by corporates, from telecoms to sugar producers. At its center, and controlled by King Mswati III and his coterie, is the opaque Tibiyo TakaNgwane, meaning  wealth of the nation, fund that has shares in many foreign and local corporates operating across diverse sectors.
Tibiyo was envisioned as a national empowerment vehicle and was established by Mswati’s father King Sobhuza II after independence in 1968. From its small beginnings, where every Swazi man was required to donate to it, usually a cow, the fund has grown to an estimated $2 billion. Like Mswati, whose personal fortune was put at $200 million by FORBES in 2008, the fund is exempt from tax, as well as civil and criminal scrutiny.
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The fund’s rapid expansion is attributed to many factors, including eviction of small-scale farmers without compensation to grab some of the country’s best agricultural lands for the fund’s sugar interests and the government’s favoritism for contracts, tenders and beneficial regulations to foreign and local corporates the fund has stakes in.
Swaziland has the trappings of a democracy, but is not recognized as one. Mswati and his royal household, government and the state have become all but indivisible.
A small business owner based in Manzini with an annual turnover of R10 million ($770,000), who declined to be identified, says “If you fly too high, you are going to come short if you come up against businesses with government interests.”
“The main driver of business in Swaziland is the government. Pretty much everyone is dependent or indirectly dependent on government,” he says.
Lynette Fraser, Russo’s 38-year-old sister, established her own water bottling business, Viva Beverages, through purifying municipal water using reverse osmosis. She sells about 100,000 500ml bottles monthly and is able to compete with her South African competitors through lower transport costs. There was a business spike recently for sales of her five liter water bottles, after the capital Mbabane experienced debilitating water shortages, where Matsapha did not.
In recent years, she says there is a growing number of entrepreneurs opening businesses, where in the past “a lot of people would go to Johannesburg because the opportunities are just so vast.”
Excluding sugar production, about 90% of Swaziland’s economic activity occurs in the Mbabane, Matsapha, Manzini corridor and entrepreneurs recognize the benefits of businesses being concentrated within easy reach of each other.
But government business involvement remains a debilitating factor. Founder and Managing Director of the internet service provider Real Image, Ali Resting, has wrestled with government for deregulation of the sector, especially a legislative clause giving Swaziland Posts and Telecommunications Corporation (SPTC) exclusive rights for importing bandwidth, resulting in hugely inflated and uncompetitive internet costs stifling investment.
“The first question investors ask is if connectivity is reasonably priced? …It does deter investors if they are spending huge amounts of money towards connectivity, when they shouldn’t have to,” says Resting.
Deregulation would not only act as a lure for companies to invest in Swaziland, it would also benefit connectivity in the region.
“There is an opportunity for Swaziland to become a transit location between Johannesburg, Durban and Mozambique by using it as a conduit for fiber infrastructure. If you can position yourselves to have the shortest route, because the internet is distance sensitive, it makes more sense to go through Swaziland… it’s a huge opportunity,” says Resting.
For entrepreneurs in Swaziland, opportunities seem to be limited to the government.

The Call  Of The African Kingdom

It was an idea that inspired a doctor to walk out of his practice. Dirk Koekemoer, the founder of biomedical engineering company eMoyo, spent the next 18 years building a device that helps tens of thousands to hear – all they have to do is sit under a tree and listen.
&#8220;It was 1999, I literally sat in practice and realized this is going to go on forever. I was going to see 30 patients a day for the rest of my life. I wanted to be able to treat thousands. I cancelled all my appointments that day and took the bold move to start a company,&#8221; says Koekemoer.
It cost Koekemoer $1.2 million and saw the birth of the KUDUwave, a mobile audiometer that looks like a set of headphones. Its size and the fact you can use it under a tree made it a game changer.
&#8220;A basic sound booth, at minimum, would cost R35,000 ($2,600). They can be the size of a fridge and are good for screening. But, the moment you want to do proper audiology the booths go up to R250,000 ($18,700). Then the moment you look at mobile audiology you need two booths on a mobile trailer, with a 4&#215;4 and on a heavy trailer. You are looking at costs of R500,000 ($37,000).&#8221;
The R65,000 ($4,800) headphones are cheap and smart. They won’t operate unless the conditions are just right. One of the best places to use them is under the shade of a tree, just as well as Africa has plenty of them. They are used in the rural areas, like Zambia, where audiologists need to get around.
&#8220;Open air testing, in an area with open windows or under a tree, is the best for ear testing. A booth needs ventilation, it needs soundproofing and probably doubles the costs.&#8221;
&#8220;There are 3.5 billion people in the world that don&#8217;t have access to adequate equipment. I thought let&#8217;s create devices that can actually do the tedious things that a doctor and a nurse have to do that don&#8217;t need brainpower,&#8221; says Koekemoer.
According to the World Health Organization (WHO), 360 million people have hearing loss and most of them live in low- and middle-income countries.
&#8220;It&#8217;s a huge need. There are 30 million people in this country with hearing problems, 2 million need hearing aids. There are not enough audiologists and there are not enough facilities,&#8221; says Koekemoer.
&#8220;Hearing loss is a serious problem. It causes dementia and depression. Also isolation, especially in the elderly; literally their life expectancies shorten if they are unable to hear well.&#8221;
In Khayelitsha, a township 28 kilometers south east of Cape Town, this is a common challenge. This is also where we follow Koekemoer to meet with head audiologist Shireen Martin, of the Khayelitsha Hospital, who has been working with the device since July.
Koekemoer’s device has transformed the way audiologists, like Martin, work. Employed by the South Africa’s Department of Health, Martin uses the device to test patients’ hearing loss in multi-drug-resistant tuberculosis (MDR-TB).
&#8220;At first I was against the idea. I think there was a lot of speculation about it. It has to do with changing the way people work and think. I was used to sitting in a booth, sitting with a patient one-on-one. It kind of made me adverse to the idea of a mobile audiometer.&#8221;
The department employs decentralized TB treatment, which means Martin needs to travel to treat patients.
&#8220;I don&#8217;t have access to any other audio equipment. With many TB clinics that decentralized their treatment and initiation of MDR-TB, many patients are not able to go to an audiologist, with them being so far away,&#8221; she says.
Martin is the only audiologist who operates here and sees up to 60 MDR-TB patients a month.
&#8220;[Patients] do appreciate it. Because it is not far away from home, they don&#8217;t have to wait long for transport to take them to far-away hospitals. Bringing the service to them is the importance of primary healthcare, not just audiology.&#8221;
MDR-TB patients need to be monitored carefully. Hearing loss can be a side effect of the drug used to treat the disease.
&#8220;Some can lose their hearing in as short a space as a month,&#8221; says Martin. &#8220;It&#8217;s devastating, especially if it happens in a short space of time. That&#8217;s why counseling is very important; so patients know what the early signs are and the importance of them coming back.&#8221;
Koekemoer believes Martin&#8217;s work is a mere drop in the ocean, considering there are 20,000 MDR-TB patients in South Africa and the disease is very infectious.
&#8220;It&#8217;s scary. Patients can&#8217;t just jump into a taxi with their disease. They need special transport. It’s why it makes sense that the audiologists go to them,&#8221; says Koekemoer.
Koekemoer&#8217;s dream started on an even grander scale – a full mobile body scanner. It was a eureka moment in his small home office in Pretoria.
&#8220;One night at two or three o&#8217;clock in the morning, I was sitting at my desk and I started drawing a picture. It was a horrible picture. It was a full solution on how to examine a patient as good as a GP would examine a patient. Things you had to put on a patient. It wasn&#8217;t like the Star Trek scanner version you see in movies, but we are getting there,&#8221; says Koekemoer.
Koekemoer has learned the business of building medical equipment is tough.
&#8220;In 2001, when I started developing these medical devices, it was so difficult. Voice over IP wasn&#8217;t even legal then. In that type of environment, it was difficult just to find information on audiometers. At that stage I was doing deep searches on university FTP sites. I had to invent my own software to actually find the information. Now it&#8217;s easy. The rate of inventiveness increases significantly.&#8221;
Patents are expensive. According to Koekemoer a single patent costs R1 million ($75,000), and a further R500,000 ($37,000) every year after. It still doesn&#8217;t protect your devices; poached product designs are common. It can be as simple as changing a small part. Koekemoer says that in the field the headphones have a two-year advantage before similar devices appear.
&#8220;The problem is KUDUwave had got about 16 patents. It&#8217;s better to take that money and get first-mover advantage. If I can give any advice to any entrepreneur, just give up on thinking you are going to protect yourself on patents. Just get the flipping thing in the field.&#8221;
&#8220;You need to be fast, constant improvement and add additional things to the KUDUwave. In the next few days we are adding a crosscheck that will allow calibration of the device in the field.&#8221;
Next is getting the product certified. With huge backlogs worldwide, inventors struggle to get their products on shelves. The process can add years of painful delay. The South African Bureau of Standards (SABS), the governing body which approves devices in the country, has no facilities to test the device as it is so unique.
&#8220;We need alternative European certification which can take five months just to get a quote for audit. It is really difficult to say no every day and not go to the US, where it is so easy to get FDA (Food and Drug Administration) approval. FDA registration doesn&#8217;t count in South Africa, but it’s accepted in the rest of the world,&#8221; says Koekemoer.
Despite the uphill battles, Koekemoer is adamant that Africa is the place where his device can make the most difference.
“Re-engineering healthcare, that is what we are doing.”
So, when you see a patient with a set of headphones on while sitting under a tree, chances are they are taking a test that could change their lives.

Huh? Say That Again?

It’s only six blocks from James Proud’s office, a brick-walled converted bakery in San Francisco’s Mission District, to Central Kitchen, a hip restaurant owned by fellow FORBES 30 Under 30 alum Thomas McNaughton, but that’s plenty of time for the 25-year-old to take on more or less all of Silicon Valley. People who complain about finding good talent just don’t know how to recruit. Traditional venture capital firms? Unnecessary. By the time we reach the host stand, he’s deriding the entire tech community for their “airy-fairy bullsh-t about changing the world.”
This absolutism feels all the more jarring given that his short, bulldog frame and pudgy baby face make him look like the high school computer-lab nerd he once was, a persona buttressed by his wardrobe (a sweatshirt and sweatpants almost all the time, a black T-shirt if he’s feeling dressy) and diet (no vegetables, no fish). The latest in the 21st-century cavalcade of cocky prodigies in the mold of Sean Parker, Mark Zuckerberg and Evan Spiegel, Proud was born thumbing his nose at other people. “No one can make me do what I don’t want to do,” he says. He’s been professionally bred this way, too.
James Proud was in the first class of Thiel Fellows, the upstarts – 122 and counting – who for the past seven years have taken $100,000 each from billionaire contrarian Peter Thiel on the condition they skip college. And he’s also the most successful. Over the past four years he’s raised roughly $40 million for his startup, Hello, mostly at a $250 million valuation. He’s recently been raising bridge financing, at an even higher valuation, including a direct $2 million ante from the godfather himself, Thiel. It’s his first personal investment in one of his fellows. “James stood out from the start as extremely tenacious and determined,” Thiel says.
And now he’s rich, too. Proud still owns about half of Hello, pushing him well into centimillionaire territory.
Proud’s chosen market is right up there with death and taxes in terms of universality: sleep, which has suddenly become a bit more sexy and a bit less sleepy than it has been for the past few millennia. “You’re starting to see a shift in conversation around sleep that happened in the ’80s around exercise and in the ’90s and 2000s with organic and healthy eating,” Proud says. Arianna Huffington has raised $7 million for Thrive Global, which offers a suite of products and services driven by the idea that more sleep translates to a better life, and Casper, the mattress-will-change-your-life startup, has raised $70 million.
Proud’s focus is on hardware, specifically an orb the size of a tennis ball that sits on your bedside table and uses a variety of hidden sensors to track your movements and the surrounding nighttime atmosphere. The $149 gadget, called Sense, grades your sleep on a scale from 0 to 100 – and tries to help you improve that score over time. Proud claims that the Sense holiday rollout at Target is the biggest the retailer has ever done for a new electronics product (Target says that’s incorrect).
Big orders won’t guarantee big success, at least not immediately. A source close to the company says the internal sales projection for 2017 is 250,000 Sense units, implying net revenues in the ballpark of $20 million. Tiny compared even to a flagging competitor like Fitbit, which likely finished 2016 with sales of more than $2.3 billion – and even at that size, it’s barely profitable. Meanwhile, a triad of monoliths – Amazon, Apple and Google – stand determined to put connected devices on every conceivable surface of your body and in every space in your home.
What does Proud think of his trillion-dollar competitors? Looking up from his lamb ribs and roast pork, he lifts both hands in a double-middle-finger salute.
It’s the kind of brashness that a Peter Thiel could love. That tack surely worked for Zuckerberg and Spiegel. But youthful hubris goes back to Icarus, and that tale didn’t end with an IPO. Given his complicated market, dotted with pitfalls and entrenched enemies, Proud will ultimately demonstrate whether unswerving self-confidence is a necessary entrepreneurial attribute or a potentially fatal flaw. At the FORBES Under 30 Summit in Boston last October, Proud was asked backstage whether he’d ever met Richard Branson, whom he would soon join on a panel. “The real question,” Proud responded, “is whether Branson has ever met me.”
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Proud grew up less than an hour away from Branson’s childhood home south of London. His father worked for the British civil service, and his mother was a secretary who later stocked grocery-store shelves at night. Proud preferred haunting the computer lab to making friends on the playground. His first Internet payday came at the age of 12, when he built a website for a scammer he had met through an online forum (he spent the money on a Sony Ericsson mobile phone and Creative Labs MP3 player). As a hired hand for Web projects, he began making hundreds of dollars per job. At one point his PayPal account was frozen because he was underage, so cash arrived in the mail, prompting questions from his parents.
At 17 Proud started GigLocator, a website that aggregated concert ticket information, and persuaded his parents to let him take a gap year to work on it. He fed himself by faking hole punches on loyalty cards from a British chicken chain, Nando’s, or else schmoozing venture capitalists and other European techies over lunch, always letting them pick up the check. “Already back then, James had this laser-sharp focus about what he was going to do for the next ten years,” says Spotify founder Daniel Ek, who met Proud playing Ping-Pong during that period. “It was incredibly rare to see that from someone who should have been more focused on girls and school.”
Proud would have been the first in his family to attend college, but when the day came to enroll, he refused to go, despite his parents’ pleas. Then, on a September day in 2010, Proud found his savior at 1AM while watching a live stream of the TechCrunch Disrupt conference. There Thiel announced his eponymous fellowship: a $100,000 grant to each of 20 teenagers who wanted to skip college to pursue another dream. Proud decided to apply on the spot.
When Thiel flew the finalists out to hobnob in San Francisco, Proud was surrounded by preppy American kids with acceptances to Harvard they wanted to turn down. He returned to London, sure he wouldn’t make the cut. “I wished I didn’t even come,” Proud says. “I was going to have to go back and hate my life because I’d seen that this would be so much better.” But in April 2011 Thiel’s organization called to give him the good news. They also told him to sit tight until July. Proud, of course, was in a hurry – and not listening to anyone who would stop him. He quickly emptied his savings to buy a plane ticket and then demanded the first Thiel check be sent early, lest he end up sleeping on the street. They caved.
The fellowship changed Proud’s life, turning him from an unknown programmer living with his parents to a member of an inaugural class of wunderkinds. While crashing on air mattresses and couches for most of the next year, he took advantage of every door the Thiel brand opened across Silicon Valley. For a time Proud worked out of PayPal cofounder Max Levchin’s incubator, and in June 2012 he offloaded GigLocator to the concert promoter Peter Shapiro, earning himself a cool six-figure payday. (“That’s one young, smart mother–ker,” says Shapiro.)
Soon after, Proud began raising money for a new stealth startup that would become Hello. “I said, ‘I’m in for whatever amount you’ll let me in for,’” says Shakil Khan, an early Spotify investor that Proud befriended in London. “He said, ‘I still haven’t finalized what it’s going to be.’ And I said, ‘That’s irrelevant.’”
The original idea for Hello was to build a better version of the activity-tracker wristband pioneered by Fitbit and Jawbone. Proud recruited a handful of young hardware engineers and spent 18 months developing a prototype, which included a magnetic strap similar to one that would later appear on the Apple Watch. But over time Proud quietly soured on its potential. He noticed that no one on his team wore any existing product on his or her wrist for more than a few weeks. Consumer surveys show similar results, with estimates that about a third of wearables owners give up on their devices within the first six months. Plus, competition was fierce. Google would announce Android Wear in March 2014, and the Apple Watch debuted in September. Proud was already late to a category in which he no longer believed. “So what do you do? Do you give the money back to investors and send everyone home?” he asked.
The epiphany came when Proud flew out to New York City to attend a birthday party in March 2014.
Distracted by his dilemma, he brainstormed about products that wouldn’t need to be worn at all times and suddenly arrived at sleep tracking. People enjoyed the feature on wristbands but hated wearing them overnight. He brought the team together when he returned and told them they would be scrapping a year and a half of work to start over. “I wore the wristband prototypes for a good two weeks after, holding on to the work we had done,” says Hello’s first industrial designer, Rob Shook.
Proud also had to sell his decision to an angry group of investors who had supported a $7 million Series A only months earlier. To placate them, he granted additional shares to everyone who participated in the round, including Khan, then-PayPal president David Marcus and Xiaomi vice president Hugo Barra. “Had the decision to pivot come three months later, I don’t think the company would have survived,” says Dan Rose, Facebook’s vice president of partnerships and Hello’s only board member other than Proud.
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Proud’s move away from wearable devices took Hello out of a crowded but expanding market – an estimated 67 million smart watches will be sold this year – and made it the pioneer of a completely new one. “If it can work, it can end up being a consumer device on par with the iPod,” Thiel says. A huge if. Searching for scientific backing Proud hired Matthew Walker, director of the Sleep &amp; Neuroimaging Laboratory at the University of California, Berkeley, as Hello’s chief scientist. Walker believes that lack of sleep is an “epidemic” in First World countries and that Sense can help fix that. After one year of use, 71% of Sense users slept longer on average than they had before, and 57% had more regular wake-up times, the company claims. Hello hopes to do even better as it tests more personalized sleep techniques.
Proud proved there was a market for sleep-centered products, at least among early adopters, with a successful Kickstarter campaign in July 2014. After racing to build a basic hardware prototype and marketable software façade, Hello launched its campaign with a slick video and a goal of $100,000. It blew past the finish line, scoring $1 million in the first four days and $2.4 million after one month, just a hair shy of VR phenomenon Oculus Rift’s crowdfunding haul. That summer proved an intoxicating high, but there was so much to do to make the marketing pitch a reality that four bottles of celebratory champagne sat in the office refrigerator unopened until this past Thanksgiving.
Hello promised delivery by November 2014 but delayed the first shipments until February as production challenges mounted. Sense is a two-part system that includes a bedside device – an amalgam of LEDs, circuits and sensors to detect light, sound, temperature and air quality, all stuffed into a small sphere – and an accompanying battery-powered, Bluetooth-enabled “Sleep Pill,” which clips to your pillow to track movement. The team had to design many of the manufacturing tools themselves. That following June Hello brought in a $30 million cash infusion at the $250 million valuation from the likes of Temasek Holdings, a government-owned investment fund in Singapore, but the rest of the year was lost to fixing bugs and rewriting core features. In 2016, as Amazon rolled out the Echo and Google revealed Google Home, both voice-enabled wireless speakers, Proud pushed the team to add voice controls to the latest Sense, which went on sale this past November.
“The big challenge is always: Can you lock in the market enough before people develop copycats that are cheaper and roughly equivalent?” Thiel says. “This is always something a little harder for hardware than software.”
Unfortunately, even the new version feels like an unfinished product searching for a market. After trying it for a week, I enjoyed Sense’s novelty as a smarter alarm clock with limited voice commands and the ability to turn off the alarm with a wave of your hand. But for my $149, the core functionality is too inconsistent. It’s supposed to detect when you fall asleep and wake up, and analyze your tossing and turning to see how many hours you’re in deep sleep. Yet the Sense interprets data gathered from the clip on my pillow rather than a band on my wrist, so it frequently fails to register when I get up from bed and often confuses my fiancée’s movement for my own. Even if it were accurate, neither the sleep results nor other measurements are groundbreaking. Everyone already knows that blackout curtains are good for beauty rest and a barking dog is bad.
Other warning signs abound. Proud boasts about the new Hello displays in nearly 700 Target stores across the country, but the only inventory in Oakland was one Sense tucked in a side cabinet next to some Apple TVs and Linksys wireless routers. A survey of Best Buys around New York found only one with the product in stock; other stores indicated you needed to order it. And when I brought a Sense home, I nearly abandoned the set-up process after an hour of trying and failing to plug in the charging cable. Hello says a new manufacturer had constructed the USB port a millimeter off target in a few units.
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While plenty of questions remain about Sense, Proud now treats his risky pivot as a thesis statement. He trashes devices that need to be worn (like the Apple Watch) or require direct interaction (like the home assistants from Amazon and Google). His goal is to cover the entire 24 hours of your day with a few “nonengagement” health-tracking devices like Sense. “It’s a tragedy that we  can’t build and release them all right now,” Proud asserts.
He’ll need to diversify his product line soon to avoid the fate of other hardware startups like fellow Kickstarter darling Pebble, which shut down in December, and drone maker 3D Robotics, which crashed after burning through $100 million in funding. Even public companies like Fitbit (trading down 86% from its peak) and GoPro (down 90%) have struggled. “On one hand, it’s easier than ever to build a hardware product,” says Jan Dawson, analyst at Jackdaw Research. “But in some ways it’s harder than ever to be competitive and build a sustainable business.”
In the meantime, Proud must mature as the leader of a 50-employee startup trying to go toe-to-toe with companies that outnumber and out-finance him. While friends extol Proud as wise beyond his years, former Hello staffers describe him as a smart but inveterate risk-taker who often unravels in tense situations. “You could see the pressure got to him, and sometimes I would think it’s because he’s young,” a former Hello engineer says. “He would suddenly rush in saying, ‘We need to do X because people are complaining about it.’” Instead of patiently adhering to a long-term plan, Proud is prone to rash decisions. “The ability to take risks and be aggressive is the foundation of James’ decision making, and it may eventually come back to bite him,” says one ex-Hello employee who worked closely with Proud for more than two years. “If that day never comes, he’s a genius. If it does, the warning signs were there.” Proud doesn’t deny he can be a capricious boss. In December 2014, on the morning an engineer was set to fly to China to install the final firmware for the Sense’s first manufacturing run, Proud decided to add one more feature. His CTO, Tim Bart, told him it was insane to change anything in the code at such a late hour, but Proud was suddenly convinced that Sense should light up and play a sound when it was plugged in for the first time – like a computer booting up.
After a bruising argument, Proud got his way. The engineer finished coding the change on the cross-Pacific flight, and through skill and luck avoided introducing new bugs into the final product.
Was that last minute intervention a Steve Jobs-like moment of product genius or the power trip of an enabled, immature founder? Proud’s analysis of his behavior in hindsight is simple and unapologetic: “Well, I was right.”

The Black Sheep

For years, I’ve been a silent observer of the World Economic Forum (WEF), reading about it on the internet, editing reams of copy on it or watching it on TV. But one question has always remained in my mind. What drives thousands of people each year to a small alpine town in Switzerland to live out Professor Klaus Schwab’s dream, who founded the forum in 1971?
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After traveling almost 13,000 kilometers from the tip of Africa to Davos, a semblance of an answer began to emerge.
The answer was not to be found in the sub-zero temperatures that left the entire body numb with cold nor in Responsive and Responsible Leadership, the theme driving the WEF Annual Meeting 2017. Instead it was to be found in the Congress Centre, or on the streets and hotels of Davos-Klosters.
It was to be found among the people – the 3,000 delegates that gathered for the event and the thousands of support staff.
The draw card – the opportunity to mingle and be seen with the most influential and powerful people in the world. Christine Lagarde, Managing Director of the International Monetary Fund, crossed my path several times at Davos. Mauritius President Dr Ameenah Gurib-Fakim, after sharing her plans for attracting investors to her country on a cold winter’s night, agreed to a photo with me.
Singer and songwriter Shakira shared her passion for early child development advising us that “today’s babies will drive tomorrow’s business. Their capacity to contribute will shape tomorrow’s societies, will solve tomorrow’s problems”.
Anne-Sophie Mutter, one of the world’s most famous violinists, entertained the crowds. Ngozi Okonjo-Iweala, former Finance Minister of Nigeria and Board Chair of Gavi, the Vaccine Alliance, discussed plans to immunize up to 300 million more children all over the world by 2020.
The allure of Davos is that it gives delegates a platform to discuss the most pressing issues of our time, such as the refugee crisis, climate change and can-women-have-it-all?
It offers an arena to do business deals with the richest, to form new contacts and exchange business cards. It provides purveyors a glimpse into where the world stands, shifts in geopolitics and the ironies and contradictions of the world. It allows those present to see who controls the vast majority of wealth and intellectual capital and how this has changed.
WEF 2017 was a world in which the largest bankers, infamous for the financial crisis, such as JP Morgan and Goldman Sachs, could be heard offering their views on Trump making America and stock markets great again, while Ugandan-born Winnie Byanyima, Executive Director at Oxfam, was decrying that eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity, according to a new report published by the agency.
It was an arena that brought into stark contrast the plight of Africa, and the developed world when simultaneously it hosted a panel discussion with CNBC Africa on Powering Africa, while meters away, some of the leading minds in technology were debating what role artificial intelligence should play in our futures; and that the 48 countries that make up sub-Saharan Africa generate almost the same amount of electricity as Spain.
Davos 2017 was a gathering where UK’s Prime Minister Theresa May declared that Britain’s decision to leave the European Union was not a rejection of its friends in Europe but simply a vote to restore its “parliamentary democracy and national self-determination. A vote to take control and make decisions for ourselves”. Juxtapose this with Xi Jinping’s attendance. Jinping, the first Chinese president to attend WEF, led the country’s largest-ever delegation to the ski-resort town to make a statement that China wants to assume a global leadership role as the world struggles with isolationism, populism and polarization. In a speech at the event, he stated: “It is true that economic globalization has created new problems, but this is no justification to write economic globalization off completely. Rather, we should adapt to and guide economic globalization, cushion its negative impact, and deliver its benefits to all countries and all nations.”
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– Vanek is news editor of CNBC Africa and CNBCAfrica.com; she lives and breathes business and financial news, and is now slowly developing a passion for artificial intelligence.

Why The Richest And Most Powerful Go To Davos

It is fascinating that many entrepreneurs fail to formulate business models, while some don’t even know what a business model is.
A simple definition of a business model is a plan for the successful operation of a business, identifying revenue sources, a customer base, products, and details of financing.
A unique business model can be the distinguishing factor that will set you apart from your competition.
If your competitors have a bigger market share, are more capitalized and better capacitated,  how can a different business model push your business ahead?
Malcolm Gladwell’s book David and Goliath looks at how David avoided fighting Goliath on his own terms, with swords and spears; he rather used what he knew best, because he could not have won if he tried to play Goliath’s game.
History has shown how the mighty often end up falling – and you can be the one to take them down.
Today, Naspers is the largest company in Africa and seventh largest internet company in the world by market capitalization. More than 60% of their value comes from their 34% shareholding in Tencent Holdings in China, but they still want to dominate in media and technolgy.
If you decide to go head-to-head with this enormous company, do not try to beat them at their own game; rather compete with them using a different approach. If you look at Apple, Google, Facebook and Amazon in Silicon Valley, they started by being disruptors.
I highly recommend that you learn the art and science of coming up with business models. Corporate companies, on average have at least four business models to make money.
The Founder and Group Chief Executive of Discovery Limited, Adrian Gore, is reported to have all his personal investments in the company. Some might think it’s risky to have all his eggs in one basket, but Discovery has diverse business models, such as medical aid, short-term insurance, and investments.
There are various types of business models. Telecom and electronics companies often use a model of prepaid or pay as you go.
Others, like MultiChoice and Netflix, use subscription, where you pay a continuous fee to access services or content.
Product to service is one of the most powerful models and is often used by tech companies. Uber, the world’s largest taxi company, owns no vehicles. Airbnb, the world’s largest accommodation provider, owns no real estate. Facebook, the world’s most popular media provider, creates no content. Instagram, the most valuable photo company, sells no cameras.
Low-touch is another model used by many retail companies, such as Shoprite and Walmart. They lower their prices by decreasing services. A similar model is Freemium, which offers basic services for free, but charges for the premium version, as LinkedIn does.
An interesting one is a reverse auction, where businesses bid for the amount they are willing to be paid for their service. The seller with the lowest amount wins.. One usually used with cars, is Leasing, where you rent than sell.
The crowdsourcing model is currently popular. This is where you get a group of people to contribute content for free, while you make money from advertising revenue; YouTube has mastered this.
Africa is excluded from these pioneering models. Eighty percent of the world’s mobile money transactions take place in East Africa, while $148 million a day is transacted every day using Mpesa and 40% of Kenya’s GDP is transacted through mobile money. Africa is powerfully positioned in this area and needs to make the most out of it.
We are living in an age with unlimited access to information. As Africans we have no excuse not to be competitive on a global scale. But, there needs to be an economic revolution in our consciousness that allows us to stand tall on the world’s stage.

A Revolution For  Global Domination

Decisions made by major rating agencies come and go. The more they change, the more they stay the same. Standard &amp; Poor’s has been the latest credit bureau to cut South Africa some slack, in not cutting the sovereign to a non-investment grade. Similar leniency has been shown by Fitch and Moody’s over the past 12 months. In the following year, they may however not be that patient, demanding more tangible progress with reforming the labor market, political cohesion and overcoming the challenges that poorly managed state-owned enterprises (SOEs) pose to economic growth.
Admittedly, no one likes being told what to do. That applies to decision makers in the public sector as well as in the private sector. South Africa continues to flirt with the makings of a recession, where another slip on the credit rating ladder could open up the possibility of borrowing funds from the International Monetary Fund (IMF). While this conjures up images of a bailout, it may not necessarily be as bad as it sounds. Loans come with prescribed conditions to them. The biggest will be boosting GDP growth to a more respectable level, from the lethargic level of 1% it appears destined to grow by over the next few years. The détente that was brokered this year between the government and leaders in the private sector, to halt a further slide in the country’s rating, is significant. It shows the two sides being poles apart on many things, but that the success of the economy is not the preserve of only one side.
Public-private partnerships (PPP) have emerged as a credible tool in meeting infrastructural development challenges, by harnessing the strengths of the private sector and government. The private sector provides technical know-how, management and finance for any key infrastructure project. The public sector offers security for private sector investment and also guides the PPP process through a legal and regulatory framework. A special purpose vehicle is established by the private sector, which raises a combination of debt and equity to finance the project. This structure is particularly important for SOEs; the financier will look more at this structure than it will at the cash-strapped public entity.
This framework is internationally recognized and respected. It encompasses a spending program of more than $58 billion, stretching over the following three fiscal years. Much success has already been seen with Africa’s largest PPP project –the Gautrain Rapid Rail Link, which came in around $1.7 billion. Renewable energy projects have also been successful.
However, the Infrascope project, financed by the World Bank to investigate how prepared and willing 15 African countries were to implement key PPPs, found that the process had challenges. Projects can be difficult to execute, legislative and regulatory processes can be tricky, and a high level of financial skill, sectoral knowledge and familiarity with the different structures which PPPs are needed. International investors also observe that bids have a large element of non-price factors, such as the promotion of black economic empowerment, job creation, socio-economic development and industrialization. Foreign bidders say that these local factors are too demanding and play a larger role than they should. Local stakeholders, such as trade unions, are also skeptical of PPPs, mistaking them for privatization of government assets and wary of the job losses which could accompany such projects.
It is not enough that South Africa’s GDP is growing by less than 1%, nor is it enough that reforms in the labor market have been insufficient to dent a 27.1% unemployment rate. It is also not sustainable that around half of South Africa’s population receives some form of welfare and dependency benefits.
How long it takes to rebuild the economy is difficult to say. It will take at least as long as the 33 consecutive months at which the annualized rate at which the South African Reserve Bank’s leading indicator has contracted.
Amid all the uncertainty, the one mantra which remains steadfast is that politics leads economics.

An Uneasy Partnership  That may be necessary

The tense, but eventually successful, haggling of a natural gas supply deal between Tanzania and Nigeria’s Dangote Cement is a pointer to what awaits East Africa as the region sets off the delicate journey of exploiting its new found vast reserves of oil and gas.
Tanzania’s President John Magufuli on December 10 announced that an agreement had been reached to supply natural gas to Dangote’s $500-million cement factory in the East African nation’s southeastern town of Mtwara, ending tensions after price negotiations with the state-owned Tanzania Petroleum Development Corporation (TPDC) stalled.
“They (Dangote Cement) will now buy natural gas directly from the state-run TPDC instead of going through middlemen,” Magufuli said after a meeting with the company’s chairman, and Africa’s richest man, Aliko Dangote.
Magufuli blamed unspecified middlemen for “interference”, saying Dangote Cement had sought “at-the-well prices” and that the issue had now been resolved to supply the company with the commodity at a “reasonable” tariff.
The Tanzania-Dangote price haggle offers a sneak-peek of the tough oil and gas supply contract negotiations that authorities in East Africa are certain to face in the exploitation of newly struck reserves.
East Africa has caught the attention of the global energy industry following the discovery of huge reserves of oil in Uganda and Kenya and natural gas in Tanzania. An estimated 6.5 billion barrels of oil were discovered in Uganda’s Albertine basin near the border with the Democratic Republic of the Congo (DRC). In Kenya it is estimated that the recoverable reserves total 750 million barrels of crude.
Tanzania said in February 2016 that it had discovered an additional 2.17 trillion cubic feet (tcf) of potential natural gas deposits, increasing its total estimated recoverable natural gas reserves to more than 57tcf.
The exploitation of these vast reserves will however require caution to ensure the region avoids the pitfalls of the unpopular oil curse. The nature of contracts reached with buyers has a direct impact on the country’s development.
Supply contract negotiations are not an easy task because one has to juggle maximizing revenue for government and investor protection from high cost of doing business. Given the lengthy life and complex nature of supply contracts, a miscalculation has monumental effects on either of the negotiating parties and it is vital that keen attention is paid during the entire process to attain a balance.
“One of the key concerns is that African governments that are major producers of fossil fuels (and other minerals) do not receive sufficiently large rents or revenues from the production of these extractive products. This is attributable to a number of reasons, including contracts and regimes that are not designed to extract maximum rents,” the African Development Bank (AfDB) and the African Union (AU) say in a joint study titled Oil and Gas in Africa.
Oil and gas supply contracts are particularly complex because they are not fully driven by demand-supply factors; at times they are driven by geopolitical factors. Newcomers in the game must tread carefully or risk being short-changed by the more experienced industry insiders who are privy to sale strategies.
The middle-men have a nose for quick cash and will not miss a chance to ride on the inexperience of new players in the industry to profiteer through deal-cutting. The middle-men, in most cases, fan graft in order to thrive, leaving in their wake massive damage.
Benchmarking with peers and best practice is the way to beat such odds because it helps build on contract experience. The World Bank-backed Extractive Industries Transparency Initiative (EITI) can help address such challenges by laying bare all the deals.
“Accountability and transparency in the management of public resources is critical in ensuring positive development results impact – and perhaps nowhere more so than when significant natural resource wealth such as oil and gas are present,” the AfDB and AU say in the report.
Under the EITI, mining firms are required to publish payments made to governments and to make public revenues received available for audit and monitoring. The EITI monitors and reconciles company payments and government revenues. Each signatory country owns the process, which is overseen by participants from the government, companies and national civil society.

Prepare For  tough negotiations

Kenya is rallying behind Ambassador Dr Amina Mohamed to be the next Chairperson of the African Union (AU) Commission, and Africa has warmly received her nomination. Elections were set to be held on January 31.
With a stellar diplomatic career of over three decades, Mohamed, a Kenyan, is known as an excellent strategist with proven negotiation and managerial skills, having demonstrated solid leadership in every domestic and international post she has held.
She is the serving Chair of the 10th World Trade Organization (WTO) Ministerial Conference which is the topmost decision-making body of the WTO.
Mohamed rose through the ranks in Kenya’s diplomatic service from legal advisor to the Ministry of Foreign Affairs and Kenya’s Missions to Geneva and New York, to the highest level of Ambassador/Permanent Representative, Kenya Mission, to the United Nations (UN) in Geneva from 2000 to 2006.
She served as Director, Europe and the Commonwealth and Director Diaspora from 2006 to 2007 and was Permanent Secretary, Ministry of Justice, National Cohesion and Constitutional Affairs in 2008.
In July 2011, she joined the UN as Assistant Secretary General and Deputy Executive Director of the United Nations Environment Programme (UNEP) based in Nairobi.
In April 2013, she was appointed by Kenya’s President Uhuru Kenyatta as Cabinet Secretary (Minister) for Foreign Affairs and International Trade of Kenya.
Weeks before the AU Commission elections, Mohamed spoke to CNBC Africa. Excerpts from the interview:
Q: You’ve had many firsts as a woman in leadership in Africa; just walk us through your journey?
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A: The first time I did something that I guess laid the road-map for whatever else came after was when I was elected to chair the International Organization for Migration Conference which is a council for migration. At that time, Kenya was actually the only African country that was a member of the International Organization for Migration. And when I was approached, I told them that the only reason I would agree to be put up as a candidate for the chairmanship would be if they would open up the organization for Africa, and would be able to attract more countries into the organization.
So we reached an understanding and I chaired it and during my chairmanship, that one year, I brought in a few African countries, and the rest is actually history, because now I think the largest group of countries that are members of the IOM are African countries, and from then on, I think in especially the kind of job that we do as ambassadors, you are called upon to show your commitment to the continent by agreeing to chair different bodies.
And so I was fortunate, I was privileged that the African group in the cities that I served in saw it fit to elect me over and over again, and so it’s something that I enjoyed doing, I was committed to doing and I think the record is not a bad one.
Q: You are now running to be chairperson of the AU Commission, tell us about the drive behind this decision?
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A: Kenya has put up my candidateship for the position of Chairman of the African Union Commission. Why am I running? I think we have a lot of value that we can bring to the table; we are also at a good time in the history of this continent. The first thing that comes to mind is the framework that we have. We have a framework that was agreed on by all African countries that needs a faithful implementer to put in place.
It’s a framework called Agenda 2063, for inclusive growth and sustainable development and it has a number of amazing aspirations for the continent. I think it’s actually time for East Africa because of the track record we have also set as a community, as an East African Community in what we have done.
We created a model for others to emulate and so there’s just a feeling that it was time for us to run for this position and I would be a good candidate for that because again I can bring people together, I have never come across a challenge that cannot be resolved, I look at challenges actually as opportunities. And I believe that we all know what we need as a continent to move us forward. One should look at the leaps we have made.
We are a young continent, we have done amazing things, we – many of us – have come up with new constitutions, constitutions that are based on our own realities, not on realities that come from elsewhere, also we look at our own specificities, our own individualities as countries.
For us as a continent, it’s actually excellent that we have such a young population.
It’s a young population that’s creative and innovative that are drivers of the economy and they are also the future and the present and therefore whatever they do, they know what they would like to put in place, for themselves and for their own children and for posterity I guess.
So we actually are in a situation where we can lead and not follow, because the problem is ours, the challenge is ours and it’s a wonderful opportunity to use, to propel the continent to the greatest possible heights.
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Q: Briefly take us through what an AU Commission led by you will focus on, looking at the challenges Africa is facing…
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A: I think industrialization, without any doubt. It is the only one that has the ability to reduce poverty, create the jobs that we need and to move the continent [forward]. And I think following that, trade, because trade brings us together, which is a unifier if you like.
We need to make sure that our infrastructure, whether it’s land, sea or air, is seamless. It doesn’t take a day, it’s a process but we need to get on with it. We need to remove the obstacles that are low-lying fruit… they can be removed easily.
One of those is allowing the easier movement of people, business people, of capital, services and goods. There is no reason why Kenya should import; and I am using as an example, if we did not have the dairy sector and we needed butter, milk or cheese, there is no reason why we should import that from 10,000 miles away; if we can just go across the border, into the next country and import from our neighbors.
The only reason why that has been difficult is because of the infrastructure deficit that we are faced with and we need to address that and address it quickly.
In this country we have tried to do it, in the region we have tried to do it with the SGR, with the road infrastructure that we have put in place, with the modernization with the port that has been done over the last few years, with the modernization of our airport, so those are the things we need to do across the continent so that our young people can move from one country to another, bring ideas, bring creativity, bring innovation, but also find jobs.
So apart from industrialization, and obviously there you have to address the infrastructure deficit, trade and the need to trade amongst ourselves; the intra-Africa trade is at 13%, and there is no reason for that. It should actually be at least at 30%; we should, eventually have 60% of trade within the continent.
This is where the population is, this is where the fastest growing middle-class is, and obviously with that, you have a consumer market, so this is where most of the trading should actually take place.
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Q: The outgoing AU Commission chairperson Nkosazana Dlamini-Zuma has been very vocal about peace and security. Share with us your vision…
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A: She’s also been very passionate about agriculture, because agriculture has the ability to transform communities and societies very quickly and there’s a need therefore again as a reason of the youth to make agriculture trendy and productive for the youth.
But you know you cannot undertake development unless you actually have a peaceful, stable and predictable environment. You must have peace and security, without it you can’t have growth.
And so it’s been actually a rallying call of Madam Zuma, to silence the guns and we’ve agreed that we would try to do that at least by 2020, if we can’t do it sooner. I believe that if we all came together and are always committed as she is, we should be able to do that before the 2020 deadline.
Africa does not manufacture ammunition except for a few countries. Africa is resolving most of its conflicts and there are very few countries today, of the 54, that are still engulfed in conflict, in fact there are probably less than five that are engulfed in active conflict, and therefore we are at a place where we should be talking about a peaceful Africa, a secure Africa, a growing Africa, a resilient Africa.
So it’s one of the priorities. We actually addressed most of the issues that were connected to decolonization, that peace and security became a big issue and we started addressing it.
I think if we are focused we can actually deal with it, it’s been successful in the majority of countries and of course there will be hiccups, back and forth, but I think a majority of the countries have gone beyond the stage where conflict is a daily affair, so we need to continue working on it and I think we should be able to get it done.
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Q: What’s your vision on
driving governance?
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A: We have a very comprehensive and all-inclusive agenda. And that is also an issue that is in our Agenda 2063; we are more transparent, we are more open. Again, we are a young continent, the youth is very demanding, we are involving more and more people in leadership – apart from the youth, the women that are coming in jobs now.
So I think today Africa is at a better place, in terms of the rule of law, in terms of governance than it has ever been, and I think the only way forward is to keep improving that.
And as I said before, we [Kenya] enacted our constitution in 2010. Immediately after its enactment – I was in Justice, Permanent Secretary there – we got a dozen requests from countries that wanted to come and look at our constitution and see whether there was anything they could borrow from there that would fit their own circumstances. Because at the end of the day, the instrument is only as good as its implementation.
And you will only implement something that you are really comfortable with, and so the whole purpose of coming to study and look at what we are doing is, ‘will this fit into my own circumstance, is it something I can do now, is it something that can be delayed a bit’.
As you know, our own constitution had transitional clauses, what we needed to do now, what we could a little later; some of the provisions could only actually be fully implemented in five years, six years, and 10 years. So we had actually time periods in the constitution for implementation of different provisions.
So I think it’s the same everywhere, but the governance situation on the continent is better than it’s ever been and I know it’s going to continue improving.
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Q: Your bid has been warmly
accepted across a good number of countries, over 25 African countries. What are your expectations as we head towards January 2017?
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A: We are campaigning, I was told by one of our leaders that campaigns are personal, you must ask for a vote and that if you don’t ask for a vote, even your own brother can vote against you, so we are going across the continent asking everybody for their support and trying of course to obviously convince them that we have a good candidate. They have been very receptive, very warmly received, wonderful arrangements put in place for us… we are encouraged by the reception and the support that seems to be coming across as well.
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– Gitonga is a news producer at CNBC Africa and interviewed Mohamed at the CNBC Africa studios in Nairobi in November, Kenya; for the full text of the interview, visit
www.cnbcafrica.com.

‘Our Strength Lies In Coming Together’

It is a hot, windy summer’s day in Road Port, Harare. A Coca-Cola can blows merrily down the street. The can has freedom many others here envy. This place is seized by an oppressive gloom. It is filled by a crowd of people pushing, shoving, shouting, buying and selling. There is dirty water flowing down the street and litter fills the potholes. Yet, this grubby place is seeing more trade than Zimbabwe’s biggest banks. Here, the black market is king and the new bond notes are pawns that can be sacrificed.
“The bond notes came recently and we are business people so we have already seen an opportunity to make a bit of money. We don’t see bond notes as having any sort of value, if you have 100 bond notes, I will give you US$70,” says Tapiwa Makoni, an informal money trader.
The Reserve Bank may say bond notes are 1:1 to the US dollar; the free market says no.
“People are already getting desperate for US dollars, especially when they are traveling out of the country. They are happy to get any real currency from us at whatever rate,” he says.
It all began in May, when the Reserve Bank Governor, John Mangudya, announced the bond note. Mangudya argued the notes would ease the cash crisis that saw the US dollar become scarce. It was going to come in gradually.
“The Reserve Bank has established a US$200 million foreign exchange and export incentive facility which is supported by the African Export-Import Bank to provide cushion on the high demand for foreign exchange and to provide an incentive facility of 5 percent on all foreign exchange receipts, including tobacco and gold sale proceeds,” says Mangudya.
The bond notes don’t seem to be helping much; as they too are restricted. The withdrawal limit of bond notes is $50 per day and a $150 per week.
Despite the introduction of the bond notes – that were touted by authorities as a solution to the liquidity crisis – there seems to be little improvement.
“There is a shortage of bond notes and there seems to be less US dollars on the streets. We used to get US$100 a day, but now my bank gave me only US$50 and 25 bond notes. The money is not enough because I need cash for my buying and selling business,” says a Harare trader who refused to be named.
Neville Mandimika, Africa Strategist at Rand Merchant Bank, says the bond notes are non-convertible.
“It is by decree that it is 1:1. The problem we are facing now is that because of the misunderstanding, fear and mistrust currently circulating in the economy, the US dollar is beginning to trade against itself because actual cash is more valuable than money in the bank because of the cash shortages. So [1:1] is of theoretical value but on the street, the market is saying otherwise,” says Mandimika.
According to Mandimika, the panic and kneejerk reaction has seen people holding on to their US dollars and moving it out of the country, which mitigates against the cash crisis being eased.
“That’s why the campaign by the authorities has been to reassure the market that this is not a fully-fledged return of the Zimbabwe dollar… The bond notes will spur inflation but not hyperinflation; at least we are not there yet… Everyone is trying to adjust.”
People have to adjust to it. If you have banked money in US dollars, you may get it in bond notes. This is not a currency and can’t be traded for another currency. Mandimika says Zimbabwe is likely to continue decelerating on a multi-quarter basis because of the debilitating liquidity crisis that continues to grip it.
“The continuation of the liquidity crunch has fueled the rise of the parallel market (US dollars are trading at a premium to the bond notes) which will likely add to the inflationary pressures. Although the latest inflation prints (November 2016), shows the year-on-year figure is still negative but month-on-month numbers suggests renewed inflationary pressure. This will likely be the trend for this year in the absence of a more permanent solution to the liquidity crisis,” he says.
It means the bond notes have been met with mounting anger and questions of legality. The city is full of protest banners mounted on brick walls, advertising billboards have #NoToBondNotes plastered all over them. Peaceful protesters are thrown into jail. One of them was Fadzayi Mahere, an advocate of the High Court and Supreme Court of Zimbabwe.
“Peaceful demonstrations are a constitutional right under Section 59. A demonstration had been organized by another entity, we believed in the cause. Unfortunately the organizers got abducted so the demonstration couldn’t happen,” says Mahere.
Once Mahere and her friends got news of the abduction, they decided to sit peacefully in the park. A handful of police came and ordered her and seven others into police vehicles.
“[Our rights weren’t read to us] in fact, we weren’t informed of the charges we were facing at that time. As citizens we are required by the law not to resist arrest so we went with them to the police station&#8230; We weren’t told about what charges we were facing until later on in the evening. We were asked to pay an admission of guilt fine and as a matter of principle, I was not prepared to admit guilt… the charges we were faced with were unfounded and trumped up,” says Mahere.
This meant spending the night in a filthy cell at the Harare Central Police Station. The tiny cell is cold and dark. There are no mattresses and blankets are infested with insects. The toilet is broken and water and urine floods the floor where some have to sleep, and no sanitary towels available.
“This is degrading to anyone. No one should be subjected to such conditions, even if you are held in cells pending trial. It was a long night. I am grateful I was in a group so there were moments of humour,” she says.
Mahere says, as unlawful as their arrest was, so are the bond notes. She says the term “bond note” is not defined anywhere in the Reserve Bank Act or the Banking Act.
“Bond note is not a term of conventional economics but an invention on the part of the Governor. It is clear that the law does not empower the Governor to create this, with respect, fictitious money,” says Mahere.
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However, Patrick Chinamasa, Minister of Finance and Economic Development, argues, in a statement, that under existing legislation, the Reserve Bank of Zimbabwe has the power to issue bond notes.
“I need to highlight that under existing legislation the Reserve Bank of Zimbabwe has power to issue Bond Notes in terms of the provisions of Section 7 of the Reserve Bank of Zimbabwe Act Chapter (22:15). The Export Incentive Scheme could also have been introduced through Section 2 of the Exchange Control Act (Chapter 22:05) which empowers the President to make regulations relating directly or indirectly to exchange transactions and the control of imports into and exports from Zimbabwe, and payments,” says Chinamasa.
Mahere, however, argues that the Reserve Bank Act authorizes issuing Reserve Bank vouchers, not bond notes, when there is a shortage of currency of any denomination to pay civil servants or employees of the state.
“The shortage must be shown to require urgent action in the interests of public order or the economic interests of the state. The justification given by the Governor for the creation of bond notes is, therefore, inconsistent with section 42B of the Reserve Bank Act. The Governor’s justification for the curious move relates to foreign exchange stabilization and an unsatisfactory attempt to ease the cash crisis.”
“Within a few months, because we are such an import driven economy, when people are trying to replenish their stock, we will see what happens, we will see what our government does when it has the scope of printing money. We have seen that in 2008,” she says.
Mahere adds that her problem is not the bond note itself but the refusal by government to address issues at their root and attend to the fundamental causes to economic problems in Zimbabwe.
According to the Reserve Bank, the Retailers Association of Zimbabwe, fuel companies, representatives of the various business associations and the Consumer Council of Zimbabwe agreed on the use of bond notes as a medium of exchange in the country. Most traders are accepting the bond notes but worry about their future.
“I hope this will not be a repeat of 2008 where government will start printing money that is actually worthless. I have to buy my stock in South Africa because no company makes the hardware I sell here. I heard some petrol stations are already rejecting it,” says Clive Moyo, a cabinet and coffin handle trader.
The argument goes on. What is clear is people are buying and selling pieces of paper they aren’t sure about.

It Is Bond Belief

The chairman of VBS Mutual is a tall, dark and imposing chartered accountant; on this late summer’s morning he is fed up. Tshifhiwa Matodzi and his shareholders suffered slings and arrows when they opted to loan President Jacob Zuma millions to refund the taxpayer for Nkandla. At the time politicians were baying for the bank&#8217;s blood and media was digging for dirt.
Soon after it was announced that the president paid the money through VBS Mutual in September, a small bank founded in Venda in 1982, in northern South Africa, the opposition Democratic Alliance (DA) issued a statement demanding disclosure.
“While both Zuma and VBS Mutual Bank claim a home loan agreement or mortgage does exist between the two parties, there’s no evidence of such a bond registered in the deeds registry, raising the question as to whether a home loan indeed does exist,” says the DA.
It was a deal that the press and opposition in Parliament thought fishy; they thought the loan was funded by the Public Investment Corporation (PIC), a retirement fund that has a 25% shareholding in VBS Mutual. Eight months later, Matodzi, suited and booted in a Melrose Arch hotel in northern Johannesburg, was indignant, but composed.
“There were no underhand dealings. They all said go find out if there’s bribery involved. If you do things right, these things fall out. People realized that we are not interested in politics, I have never met the president. They came with their corruption accusations, but they found nothing. There were racism undertones,” says Matodzi.
On December 14, the DA leader Mmusi Maimane’s spokesman, Mabine Seabe, said neither the office of the president or VBS Mutual complied with their demand to see the proof of payment.
“It is in the public interest to ascertain whether a loan exists; what the conditions of the loan are; whether Jacob Zuma has personally signed surety on the loan, and not any of his cronies; and what effect, if any, does this have on the court’s finding that the president must personally pay back the R7.8 million determined by the National Treasury,” says the DA.
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“We cannot provide the DA or anyone with a proof of payment of the President&#8217;s loan or any of our clients&#8217; because of the confidentiality rule and agreement that governs the relationship between the bank and its clients. It is important to note that the National Treasury did make it publicly known and confirmed that the President has honored the said payment through a loan from VBS Mutual Bank. This confirmation was made public to the DA and everyone that the President has paid through a loan from VBS Mutual Bank,” says a response from VBS Mutual.
Matodzi decries controversial stories around the President’s loan, questioning the bank’s funding of rural homes without title deeds. Cynicism emerged on radio stations, in particular Power FM, where the bank was discussed. One online response said: “What are the odds that within a year this little mouse of a bank will have to be bailed out by the PIC because of a cashflow problem due to a certain big lender not honoring his commitments?”
Again Matodzi was indignant.
“It was not the biggest loan, it was not even in our top 50, but it was the biggest profile simply because it’s the president. The bank has the assets of R1.2 billion ($87.5 million), so you may understand that a R7 million ($500,000) is a drop in the ocean. The original name was Venda Building Society, so our main core business was funding homes in traditional Venda where other banks didn’t want to go,” he says.
City Press’ investigative and award-winning journalist, Sipho Masondo, was one of the journalists Matodzi claimed to have written hearsay about VBS Mutual. In one of the articles entitled ‘What is VBS Mutual Bank? Everything you need to know’, the newspaper alleged Matodzi and Robert Madzonga, the Chief Operating Officer, ran the bank with impunity. Masondo said the bank’s board didn’t approve of a R136-million ($9.9-million) loan for the two to buy a 54% stake in Afric Oil but they took the loan anyway. Masondo further alleged Zuma intended to crown the Venda king, a VBS shareholder, around the same time the loan was awarded. But when FORBES AFRICA asked Masondo to reiterate his claims in December, he was uncooperative.
Matodzi denies any wrongdoing.
“Whether it was in Nkandla or Venda, to us it was not a problem. I think it was the lack of education and a political issue that created the talk about the President’s loan. Countries should be built from their rural areas, and that’s what VBS has been doing better than any other bank. As a business we are exploiting the vacuum that has been created by mainstream banks,” says Matodzi.
Matodzi was still in primary school when the bank was formed by the Venda Bantustan government and traditional leaders. He says in the 1980s it was a go-to bank for the local people. It was during those early days he had the epiphany that when he finished university he would help the bank grow.
VBS Mutual became a mutual bank in 1990. Now it is one of three in the country, along with Ithala Development Finance Corporation and Finbond Mutual Bank.
VBS Mutual, which has only four branches in South Africa, including the headquarters in Johannesburg, was in the red until 2013 when Dyambeu Investments acquired a majority stake. Dyambeu partners, including Matodzi, property magnate David Mabilu, telecoms businessman Maanda Phalanndwa, and the Venda King Toni Mphephu Ramabulana, own 26% of the shares.
Matodzi, who served as an IT auditor at various South African banks while doing articles at KPMG, says one of the pillars of their turnaround strategy was the repositioning of the bank as a small- and medium-enterprise (SME) bank. In a year, more than R450 million ($32.8 million) was advanced to SMEs. He claimed 99% repayment from rural clients.
It may be a small bank but it will be remembered for lending always to the big man.

Bank On Us  Mr President

Where would we be without globalization? What if media was restricted to reporting within its own national boundaries? What if we all lived in isolation? It’s a scary picture and one where humanity would have not progressed as broadly as it has.
To fellow African entrepreneurs, I want to say one thing: the more you are exposed to, the bigger you can dream.
Industrialization progressed by further developing what had been done before. Only after working with renowned inventor Thomas Edison, could Nikola Tesla go on to create his own inventions.
Andrew Carnegie worked under the leading businessman, Thomas A. Scott. This mentorship allowed Carnegie to define an era by starting a generation of industrialists, pioneering the philanthropic movement, and becoming an epitome of self-development.
The key word here is exposure.
There are countless occasions where entrepreneurs only discovered their flair by observing other entrepreneurs or studying companies that transformed industries. Some even became competitors of their former employers.
Adrian Gore, the Founder of Discovery Holdings, was exposed to the dealings of the insurance sector early in his career. He worked for Liberty Life but resigned to build his own insurance company. Today, Discovery is the leading medical insurance company in South Africa.
Isn’t it surprising that many companies were started by entrepreneurs who thought they could do it better? Deciding to improve something can shape your destiny. Decisions like these act as the force that pushes us on in our lives.
Look at the former employees of PayPal – today known as the PayPal Mafia. After leaving the famous tech company, these individuals went on to found and fund other mammoth companies like LinkedIn, YouTube, Facebook, Tesla, SpaceX and they are not finished. At the moment, they are investing in Artificial Intelligence.
These gentlemen were exposed to a revolutionary business and they now all share a drive to change the world as we know it to a better world, one that they see in their minds.
Exposure can give you something other than experience, it can also get you through certain doors that were previously shut. Let’s look at two entrepreneurs; both are looking to seal separate deals. Entrepreneur X closes a $1.8 billion deal, while entrepreneur Y gets a $274,000 deal.
Both worked tirelessly to get these deals but the rewards are not the same. It is likely that entrepreneur X has been exposed to certain levels, while entrepreneur Y was operating independently. They might have both known about the $1.8 billion deal, but knowing about it does not mean you have access to it. You need to run in certain circles to get exposed to deals that involve other entrepreneurs in those circles.
What led Aliko Dangote to manufacturing? While trading commodities, he took note of the huge market in Nigeria and decided it was better to manufacture what he was importing.
Before founding Apple, a 12-year-old Steve Jobs landed a summer job at HP and the rest is history. It is this type of exposure that allows entrepreneurs to gravitate towards their destinies.
If you look at the rain, you will never plant. Get out there; attend conferences, travel to various countries, network with successful business leaders and read as much as you can. Whatever you are exposed to can only broaden your current view on the world around you.
By exposing yourself, you also expose your company to other markets and greater opportunities.
You can’t afford to stand idly by and wait for everything to fall in place. Business, and life, is a fight for territory – the moment you stop fighting for what you want, is the moment you will have lost.

Nothing was Achieved  by Being Idle

Tanzania’s reluctance to adopt a joint tourism visa arrangement with its East African neighbors offers an opportunity for the scheme’s proponents to rethink underlying challenges of security and illegal immigrants.
Since 2014, Kenya, Uganda and Rwanda have implemented a joint $100 tourist visa. Tanzania, though, instead demands its own $150 visa fee for visitors entering its borders.
Having a joint visa arrangement is a no-brainer for the East African Community (EAC) bloc that is trying to increase earnings from visitor bookings and attract foreign investment into its budding tourism industry. A seamless visa boosts the attractiveness of a bloc because visitors are spared the hustle of having to make multiple arrangements to enter each of the partner states.
Dar es Salaam however maintains that there are always two sides of a coin and will not jump onto the bandwagon until it conclusively assesses the impact of the scheme.
Because of this, there is bad blood between the EAC partners and Dar es Salaam. Tanzania’s neighbors see it as standing in the way of a potential game-changing concept.
Kenya’s Tourism minister Najib Balala recently kicked up a fresh storm when he claimed that Tanzania had pulled out of the joint EAC single tourist visa pact because it was dissatisfied with the manner in which it was ratified. Tanzania denies this and maintains it has never been part of the deal and would only join if there was deeper consensus on security and revenue sharing formulas.
Dar es Salaam’s concerns, especially that of security, must be taken seriously by Kenya, Uganda and Rwanda, rather than just focusing on tourism and investment.
It’s not new for some members of economic blocs to reject seamless travel arrangements with other partners. The UK and the Republic of Ireland opted out of the EU’s Schengen visa scheme over concerns on the security risks of seamless travel by visitors to member states. The UK opted to maintain its own borders, and Ireland preserved its free movement arrangement with the UK rather than join Schengen.
This issue has recently featured in key debates in the wake of terror attacks in France and Belgium, with some analysts linking the attacks to the lax border scrutiny that comes with the seamless border arrangement.
Similar challenges are present in East Africa where Islamist militants continue to pose a threat from their hideouts in the lawless parts of Somalia. Kenya and Uganda have borne the brunt of the militant groups, such as al-Shabaab, and the question of border security and immigration should be an obvious concern.
Kenya has also become a major transit route for illegal immigrants heading south in search of jobs, thanks to a raft of poorly implemented regional agreements that allow for the free movement of people.
For example, although Ethiopia isn’t a member of the EAC, its citizens are allowed visa-free travel to neighboring Kenya. This scenario has inadvertently seen Kenya become a transit route for illegal immigrants from Ethiopia looking for jobs as far as South Africa. Hundreds of Ethiopians and Eritreans have been arrested on Kenyan soil for being in the country illegally as they try finding their way to southern Africa.
This poses a serious security risk because militants can sneak into Kenya and onward to other countries in the region. The illegal immigrations also pose a challenge to the targeted countries because of the disruptions caused to their economies, exacerbating the scramble for jobs and housing and other basic amenities.
Countries targeted by the illegal immigrants that pass through Kenya, such as South Africa and Zambia, have witnessed xenophobic attacks due to pressure caused on resources by the uninvited guests.
The EAC partners need to then find workable solutions to keep out any cross-border security threats and illegal immigrants, even as they pursue a dream of a common tourism industry which has its obvious benefits.
On a visit to Kenya in mid-October, South Africa’s President Jacob Zuma raised this issue with immigration controls in Kenya and said they posed challenges.
“We have to ensure that there are no loopholes for criminals to take advantage of,” he said in response to a request by his host President Uhuru Kenyatta to review visa conditions for Kenyans.

Secure Borders Before Making Them Seamless

It is the faint whiff of tobacco that turns your head as you walk through Cape Town&#8217;s cobbled Greenmarket Square. All around are tourists with coffee in hand and people talking business in sidewalk bars. Everything you can see is like modern cosmopolitan to the cries of hawkers selling African art under canvas.
Here among the new, you will find – amid clouds of smoke – the ancient, in terms of African shops.
Sturk&#8217;s Tobacconists opened its doors in Greenmarket Square on August 1, 1793, and hasn&#8217;t closed them. The business seems durable to say the least. In recent times #FeesMustFall students fought pitched battles near the doorstep of Sturk&#8217;s – even then it did not close its doors.
This 223-year-old store, which is older than the Louvre in Paris by nine days, is now owned by Alan Phillips, a former customer and bartender from Benoni in Johannesburg.
&#8220;Smoking a pipe isn&#8217;t something you just pick up and smoke and enjoy. There is a process. It&#8217;s not for everybody. The pipe bug hit and then I became a client of Sturk&#8217;s,&#8221; says Phillips, leaning on the store’s hardwood counter.
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Phillips is not just the owner, he is also a student of the history of the store. The likes of Cape governors and even at one time Winston Churchill visited it.
&#8220;Originally the entire building was [Hendrick] Sturk&#8217;s. He was a general dealer. At that stage the Cape governor&#8217;s house is where the South African Museum in Company&#8217;s Garden is. This was the CBD, it&#8217;s where everything happened. This square is where you bought your vegetables.&#8221;
Inside are relics that tell the passage of time. Phillips weighs his blended pipe tobacco on the company&#8217;s 200-year-old scale. Around him are ceramic pots that have also survived a couple of wars. Sitting next to them are vials of tobacco flavorant gathering dust in the rafters. Even World War II posters, found in a bunker in France, were brought here to add to the flavor of another time.
&#8220;Look, we&#8217;re a specialty shop. You can buy cigarettes pretty much anywhere, the street vendor the grocer, wherever.  Tobacco is our bread and butter. We blend it ourselves. When I talk about a niche business, you cannot buy a blend we produce anywhere other than where we are sitting now. We do cigarette shag and pipe tobacco blended to our own specifications, through age-old recipes.&#8221;
The sweet scent of tobacco may have layered onto these walls over two centuries, but in the uncertain 21st century the store is suffering hard times.
&#8220;It&#8217;s hard to pinpoint the exact cause. 2015 and 2016 have not been good years. The three main factors are new smoking laws, global economics and South Africa visa laws which affected us severely.&#8221;
Ten years ago, Sturk&#8217;s would sell an average of at least 80 kilograms of tobacco blend a month. By 2011, it was 70 kilograms. These days, Phillips sells 50 kilograms.
The tobacco industry has taken a huge knock globally as tighter health restrictions have been imposed. In 2013, Phillips says the South African Department of Health cracked down on smoking laws. These included store owners using designated smoking shelf zones, restrictions on advertising, and higher taxes.
Phillips&#8217; main worry is a pending amendment which, if enforced, could reduce his shelf space to a mere four square meters.
&#8220;This business sells tobacco related items only. Four square meters is going to be a problem. I cannot fit a thousand stock units in four square meters, it&#8217;s absolutely impossible.&#8221;
&#8220;I can understand the Department of Health&#8217;s point of view, it&#8217;s for health reasons. But the revenue generated through tobacco tax is huge,&#8221; he says.
Coupled with tighter laws is a decrease in tourists and a grinding South African economy.
&#8220;Although, the business can&#8217;t count on the tourism factor, as we recently found out with the visa debacle that was happening with the unabridged birth certificates, it knocked down tourism figures significantly, and our business.&#8221;
On this morning, a number of curious customers trickle in. Phillips gets up to weigh out a 50-gram pack of his tobacco blend which sells for R55 ($4) to a pipe smoker. Another customer gets his lighter filled at no charge.
&#8220;I generally buy loose tobacco in five-kilogram bundles which we then blend and repack. I try to keep cigarette turnover under 20% of total. The margins on cigarettes are very low,&#8221; he says.
Opposite the counter is Phillips’ pride and joy, an assortment of smoking pipes, hanging in fluorescent light for all to see.
&#8220;What you see here, hasn&#8217;t been purchased quickly to give a look to the shop. This is the way the shop has always looked. I&#8217;m sitting on around 150, I haven&#8217;t bothered to count in the last year or two,&#8221; he says.
Some of the pieces in Phillips&#8217; collection can cost as much as R3,000 ($225). The collection may not be up for sale, but Phillips does sell high-end pipes on the rare occasion. His biggest sale was an order for a Dunhill Christmas pipe for R9,000 ($670).
&#8220;[Pipe smoking is] exclusive, you don&#8217;t see many men with pipes, you hardly see any women with pipes. The options of the tobacco are almost endless. There is a difference in aromas, in flavors and one can blend to ones heart&#8217;s content to make something bespoke for you.&#8221;
Phillips holds a favorite from his collection. The South African-made pipe has a long stem – called a lovat – that has been rusticated in a well-known Italian Castello style.
&#8220;New, this guy would retail at R3,000. Which one would think is rather a lot of money, but considering the cost of the material and the time required to produce a pipe like this, it means the pipe maker is only earning about R100 an hour. Which is not fair on the pipe maker, but it is what it is.&#8221;
As it becomes more difficult to sell his wares, Phillips is doing the best he can to swim with his head above water.
&#8220;Talking about adaptation though, we&#8217;ve supplemented the decline in volume with newer smokeless products like snus and vaping.&#8221;
As the discussion finishes he gets up from the counter and adds: &#8220;Survival is about adaption, you see.&#8221;
Survival is going to be as tough as being a smoker in urban Africa.

The 200-Year-Old  Business That Could  Go Up In Smoke

In a case of David against Goliath, Ameenah Gurib-Fakim beat her male opponent by a landslide to become the first female president of Mauritius, a small island off the coast of Africa that has a population of just over 1.2 million. No one expected her to win.
Gurib-Fakim, who joined the presidential office on June 5, relishes shuttering glass ceilings. In Africa, there aren’t many women at the helm of countries.
“When the people voted, they voted for a package, they knew that they would have a lady president and yet they voted massively for a party that has not made any provision for constitutional change,” says Gurib-Fakim.
Born into a Muslim Indian family, Gurib-Fakim, 56, is also a former bio-scientist and the Vice Chairman of the Planet Earth Institute, an international NGO and charity that builds a path for the scientific independence of Africa.
Gurib-Fakim published more than 28 scientific books that have been devoured around the world by students and researchers. She graduated with a bachelor of science in chemistry from the University of Surrey in 1983. She then obtained her PhD in organic chemistry at Exeter University in Britain.
“I became interested in sciences at a very young age because I had good motivated teachers who infected me with the virus of science. I went into sciences following my heart because passion was there.”
Back at home, she worked at the University of Mauritius before becoming the Managing Director at CEPHYR, a centre for phytotherapy research that focuses on using plants in cosmetics, nutrition and therapy.
“When I went back to Mauritius, I realized that the work I was doing in synthetic chemistry, the infrastructure wasn’t there and yet in the academic world you either publish or perish. I chose to publish. To publish novel things you have to have novel avenues,” she says.
This is when she started to probe into the biodiversity of Mauritius. The Indian Ocean island nation is known as a global biodiversity hotspot – it is home to about 300 plant species that can only be found on the island, which are under threat as a result of human activity and climate change.
Gurib-Fakim says she wants to drive science and technology in Africa.
“We believe a scientifically independent Africa is one with science, technology and innovation fully embedded in governmental policies and priorities, delivered by properly resourced and empowered educational institutions. A scientifically independent Africa will have both the ability to train and keep brilliant scientists on the continent, and create an inspiring new generation of academic leaders. Ultimately, we believe scientific independence means that African problems can be solved by African-led solutions,” it says on the Planet Earth Institute website.
Gurib-Fakim is also an entrepreneur.
“I didn’t stay in the academic world because my second life was that of an entrepreneur. I translated that research work on herbal medicine into a business so I can safely say I am now living my third life.”
In Mauritius many girls couldn’t go to school. After 1976, this changed and yet transformation is still the biggest problem.
“Coming back to tertiary education this is again an area where we find many women coming to do studies at tertiary level but still find the gap and where we find the downside of this, is for them to get jobs, for them to be leaders in their respective fields because society in Mauritius remains fairly conservative,” she says.
According to Gurib-Fakim, science is still dominated by males in many parts of the world.
As African countries aspire for economic growth and socio-economic transformation, Gurib-Fakim says: “It is becoming clear that any innovation or ambition to become a knowledge economy has to be driven by talented African scientists and with the knowledge that innovation is not instructed!”
She has a strong passion for protecting nature, fostering research and creating a better environment for women scientists.
This year Gurib-Fakim is nominated for FORBES AFRICA’s Person of The Year in recognition of her drive to protect her nation’s environment. She was listed by FORBES in June as being the 96th most powerful woman in 2016.
Her motto is: “Follow your heart, do what you enjoy best and you won’t have to work a day in your life.”

Step Forward The President With A Purpose

The respected Kenyan scholar Ali Al’amin Mazrui would have had interesting things to say about Africa’s current dalliance with Asia, especially the rise of Chinese business interests and influence across the continent.
Increasingly, companies from Japan, Singapore, Malaysia and South Korea have also been boosting their national GDPs with Africa-based projects. According to Linklaters, a commercial law firm, Asian-sponsored project finance funds in Africa grew by over 160% during the last decade, with Nigeria, South Africa, Mozambique, Egypt and the Democratic Republic of Congo the leading destinations for these commitments, which were in excess of $12 billion.
Mazrui would have advanced a quaint thesis for re-balancing Africa’s trade, cultural and diplomatic ties with Asia’s power blocs. He would have been especially aggrieved by the current state of inertia in the political economy of Africa’s most populous nation. A pan-Africanist and student of Nigerian affairs (his wife Pauline Uti, mother of two of his five sons, is Nigerian), the late professor is credited with stating way back in the 1970s that, “Africa produces what it does not consume and consumes what it does not produce.” And those were the early days of continental profligacy.
Nigeria could be Africa’s biggest culprit in this regard. The country is consequently experiencing its first recession in 30 years. Tired of waiting for the promised hope of a better nation, Nigerians now, rightly or not, accuse their current leader of bringing Africa’s largest economy by GDP to its knees.
President Muhammadu Buhari has been blamed for not ‘radicalizing governance’ fast enough, which was one of the reasons Nigerians voted for his All Progressives Congress (APC) party in 2015. Nigeria is engulfed in a torrent of crises never before seen in the history of the nation.
Clearing the cobwebs of the past is proving to be a delicate dilemma for the taciturn president and his team. Grappling with sluggish growth, dwindling external revenues, double-digit inflation and a prolonged currency constipation, he is leading the ethical campaign to wrestle with the seen and unseen forces of corruption and ineptitude. His seeming preference for advisers from his northern base is also being openly examined by civil society.
For Nigeria’s sake, Buhari needs to win the war against graft and impunity. His victory will begin to recreate a new nation, sealing his place in history and in the soft spot of a large-hearted nation.
But, can he do what is required to transform the ethos of governance, business and society? Will “the Nigerian system” allow him?
Will confirmed and well connected crooks go to jail? Will reportedly recovered looted funds be reinjected into the treasury? Will massive recovery of this commonwealth mean less recourse to external loans? Will the judiciary invoke its constitutional principles on its own stables? Will the Economic and Financial Crimes Commission (EFCC) ever successfully convict any person of influence?
Will federal and state legislatures reduce their allowances and salaries in tandem with the austere times? Do we need a referendum on their astronomical salaries? Will the Nigerian state significantly increase investment in education, healthcare and the police, using advanced technology tools and techniques to revamp these ecosystems? And when will politics with principles become the order of the day?
These are the sort of questions Nigerians are asking themselves. But they also realize their quest for jobs, stability and development is hobbled by a subculture of guile and graft.
Teaching at Uganda’s Makerere University between 1963 and 1973, the late Mazrui was known for poking fun at the megalomania of Africa’s fat-cat leaders and speaking truth to power. Naturally, Idi Amin disliked him a lot. He was also not able to get a job in any Kenyan university during the regimes of Jomo Kenyatta and Daniel Arap Moi. Were Mazrui alive today, he would have also queried the absence of truth and the dearth of altruism in the politics of modern Nigeria.
Mazrui would have encouraged Nigeria’s business, political and military intelligentsia to openly discourse their festering sores. He would have prayed for peace, unity of purpose and nation-wide reflection. He would have said hope should never be allowed to get into a cul-de-sac.
So will 2017 be the year Nigeria begins to recalibrate its moral compass? Nigeria desperately needs to lead Africa out of the nadir of homegrown frustrations.

Category: Investment Guide

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