The selection of Hage Geingob as a future presidential candidate, during the party congress, has been widely seen as the end of the 50 years of liberation politics, which former President Sam Nujoma had dominated. A sigh of relief by the local and international business community—who feared a Zimbabwean-like land nationalization program and a confiscatory tax regime, had either of his opponents won—was heard across Namibia.
While he still has to face national and presidential elections in two years’ time, Namibia’s single-party dominant system is such that only a major political catastrophe would prevent Geingob from replacing President Hifikepunye Pohamba in 2015.
Geingob was Namibia’s prime minister since independence, in 1990, until suddenly being dismissed by Samuel Nujoma in 2002. He was banished to the political wilderness for five years before being re-appointed as prime minister by Pohamba in a transitional Cabinet that is notable for its promotion of technocrats.
Government insiders said that Geingob’s surprisingly easy victory over the more trenchant elements of the party, that has ruled Namibia since independence, would now see the country adopt a more developmental economy model. This is opposed to its current ‘mixed economy’ approach, whose success, to a large extent, would depend on oil and gas being discovered off the Namibian Atlantic coastline.
Geingob’s approach was not at variance with the ruling party’s official policies, his stress on an energy-based economy, which is needed to bring development to rural areas and address massive unemployment of more than 53%, was one that would see the state take on a more assertive role in developing the economy, according to analysts.
While the details still are not clear, chances are that Namibia under Geingob will adopt a policy of national champions as espoused by the Asian Tigers. This will boost local manufacturing and the development of so-called ‘energy corridors’ linking Namibia to its land-bound neighbors such as Botswana, Zambia and those further afield such as the Democratic Republic of the Congo, amongst others.
“The Namibian government under Geingob is increasingly likely to look towards the other BRICS (Brazil, Russia, India, China and South Africa) countries for development partners because of the ongoing crises in the Euro and Dollar areas,” says Professor Andre du Pisani, head of the University of Namibia’s Economics department and a high-level government advisor.
The stress, he said, would be more on pragmatic politics and economic cooperation, rather than the ideological stance that has characterized much of SWAPO’s 50-year-long history as battler of imperial colonialists.
As a stable democracy blessed with good, if not super-abundant, resources supported by a strong mining industry; a world-class fisheries sector and good tourism potential—Namibia has never quite met high expectations because of a lingering ideological rift between moderates and hard-line nationalists that often saw executive decisions getting bogged down in turf battles.
Geingob has made much of the fact that while the country, and its ruling party, has adopted progressive policies over the past 22 years, where it most often failed was in implementing those policies. His political victory as a moderate has raised hopes that the economy would now get out of the blocks and overcome its political inertia.
And signs are that this time, this could actually happen. In what amounted to the biggest surprise over the outcome of the party’s congress, incumbent President Pohamba announced a sudden major Cabinet reshuffle two days later that firmly sidelined the hard-line factions without totally alienating them by re-assigning half of the 24 ministerial positions in a careful political balancing act.
Former regional government and housing minister Jerry Ekandjo, who is Geingob’s strongest opponent and a noted party hardliner and Nujoma loyalists, who backed by the party’s youth league had waged an increasingly nasty campaign for the presidential nomination, were re-assigned to the ministry of youth and sports instead.
Former justice minister and party secretary-general, Pendukeni Iivula-Ithana, who had hopes of becoming Namibia’s first female president, was thrown a political lifeline by being handed the politically powerful home affairs portfolio. This after she switched her support to Geingob during the congress, rather than supporting Ekandjo, whose political views she echoes.
And to keep everything in the family, Utoni Nujoma, who first backed Iivula-Ithana but then switched back to Ekandjo, was handed the justice portfolio.
He was replaced by technocrat Netumbo Nandi-Ndaitwah as foreign affairs minister.
Pohamba, who had taken over from Nujoma as his preferred candidate in 2004, has always labored under the perception that he was a mere figurehead doing Nujoma’s bidding; this amounted to his greatest political moment in the 50 years he has lived in Nujoma’s shadow: “Going out with a bang,” as he had put it to a political confidante.
His open backing of Geingob, which upset the other two candidates no end, has effectively allowed him to bestow his own legacy upon the party by helping to elect the first non-Oshiwambo person to the country’s most powerful office and so bring to an end to Nujoma’s domination of a party he helped found in 1960.
Geingob’s victory also saw moderates make a clean sweep of all the top offices in the party hierarchy; putting paid to a mooted plan to have the hard-line Ekandjo take over the presidency for one term in order to prepare the way for Nujoma’s son, Utoni, to have a clean run at the presidency in 2019.
In his closing speech to the congress, Pohamba, with uncharacteristic frankness, referred to a “watershed” moment in the party’s history. Although he did not say so, the message was clear after Nujoma had called for a female presidential candidate, allegedly to split the pro-Geingob vote and hand victory to Ekandjo, only to see Iivula-Ithana humiliated with a mere 10% of the vote as delegates deserted her in favor of Geingob.
All agree that the rising resource nationalism as espoused by the hard-line factions in the party had now been taken off the table, although questions remained how an even-handed Geingob would be in framing policies as future president, says Graham Hopwood, director of the Institute for Public Policy Research (IPPR), a local think-tank.
“The question hanging over the Geingob candidacy is whether he will be able to distance himself from the interests of big business when making executive decisions and crafting policy,” Hopwood noted.
On the one hand, Geingob fought off Walmart’s proposed entry into the local market as not being in the interest of Namibia, but then also granted special tax status to French nuclear company Areva, a benefit that other uranium miners did not have, according to Hopwood.
This latter aspect is perhaps the most troubling aspect in an otherwise newly optimistic landscape: Geingob has admitted to receiving a $300,000 consultancy fee from Areva, albeit while still just a party backbencher in 2007.
But at least one can now expect that any future political debate over Namibia’s future would be centered on issues, rather than personalities, and that in itself amounted to major political progress, all agreed.

The Tide Turns

March 19, 2010. It was a joyful Friday night in Robertson in South Africa’s Western Cape. Wedding guests drove through the cool breeze of a warm night on their way back from a cruise on the river and everyone was merry. The piercing sound of a cellphone stopped the joy in its tracks.
“I just knew there was something wrong,” says Carl Bates.
“I always knew I would get a phone call from New Zealand late at night. This was at 10:15 on a Friday night. I always thought it was going to tell me that one of my grandparents had passed away.”
The voice on the other end of the line told Bates the bad news: his father had suffered a stroke back home in Wanganui in New Zealand and couldn’t speak or use the right side of his body. It was the prelude to a worst day that would tear at the heart of the Bates Family.
“I knew what this would mean for me: wealth destruction, business destruction and family destruction.”
It was a story rooted in rural Wanganui. The Bates family was known for its entrepreneurs in the small town, population 45,000, where the Wanganui River flows into the sea on the west coast of New Zealand’s North Island. Between them they ran a butcher’s shop, a greengrocer’s, a bicycle shop, a florist and a concrete plant.
“They were all small businesses. I was wondering why have none of these businesses made a whole lot of money? What is stopping them succeed? This whole learning and thinking was going on in my brain,” says Bates.
One of the biggest fish in Wanganui was Mike Bates, the father of Carl, who ran a plumbing; property; plant and vehicle hire business.
“I was born on March 13, 1983; dad’s business was incorporated on August 15, 1983. I had grown up with the business. I had learned about the business and watched it grow; I had watched the trials and tribulations, like when his secretary had stolen his money from him and when builders had gone bankrupt and we had not been paid,” says Bates.
“My dad was fun loving, carefree, a little bit unreliable but he was clever. He was determined and stubborn and he was a winner. People knew who he was; he wasn’t in everyone’s good books. He was fit and went to the gym and had played international roller hockey for New Zealand. He was only 51 when he suffered the stroke.”
Sadly, for Bates junior, in the years leading up to the tragedy, he had struggled to talk to his father of the dangers of building a business around one person. Ironically, passing on this message to entrepreneurs around the world was the core of his business. In his late 20s, Bates built up a R10 million-a-year ($1.16 million) business, Sirdar, which he expanded to South Africa in 2008 after a chance meeting over breakfast in Hong Kong. The business specializes in coaching entrepreneurs through independent non-executive directors assigned by the company.
Bates, who entered Massey University, Palmerston North, aged 16, had a claim to being a wunderkind of Wanganui. He studied accountancy and finance, while working full-time at McDonald’s. At 17, he was elected chairman in Palmerston North for the Young National Party; at 18, he became a director of a private hospital in the city; at 20, he was a director of Arena Manawatu—the largest multi-stadium complex in New Zealand.
Little in life could have prepared Bates for the ordeal he was to suffer on March 26, 2010, as he sat in South Africa and agonized over his father’s business.
“I was the power of attorney, along with the family lawyer, while everyone agreed that this decision to liquidate his business had to be made, I knew dad would blame me,” says Bates.
“On March 26, 2010, I made the single hardest decision of my life. I assigned the resolution that put my dad’s business into voluntary liquidation. It involved 30-odd staff; some of whom had been with dad for 30 years. My granddad, Ken, a greengrocer and part-time magician, who has just won a lifetime award at the New Zealand Magic Convention, had to talk me through signing the bit of paper. He was on the phone from Wanganui coaching me, though it was late at night. What it meant was that 30 years of business had gone. It couldn’t have carried on, the business was all built around my dad and the minute you took him out, it didn’t work. Most small-business people do this. My brother worked in the business and he said he didn’t want to take it over in the middle of the building depression.”
The signing of the paper was not the beginning of the end, to borrow words from Winston Churchill, but maybe the end of the beginning.
“The bank jumped all over the problem, they froze accounts, called in mortgages and what they did to my dad’s property company was send it under and all the businesses followed. To save the family, my mum and I took over some R6.5 million ($757,000) of debt on property assets. The value of the assets and the value of the property left us with negative value. We were drained trying to hold it all together. I used to get up at 4am bleary eyed, in South Africa, to negotiate with the banks and key creditors,” says Bates.
The rift between father and son proved just as complicated and even more heart rending.
“In an instant the hierarchy of our family was turned upside down. I was gutted, I knew dad would hold it against me, which he did. He literally didn’t communicate with me for six months. He can’t talk but he can communicate.”
Clearing up the financial mess by realizing family assets, triggered even more pain.
“A trespass notice was served on him to get out of the house in December 2011 while we were still dealing with tidying up the mess. One of the things we had to do was sell the house he lived in… He decided he didn’t want it sold and he barricaded himself in and got someone to change the locks to stop us getting the building inspector in to do the final inspection. We had a cash offer on the table, but couldn’t sell. Dad had another mini stroke while he was driving to buy some food. While he was in hospital we had to sell the place, then he didn’t communicate with me for another six months.”
As the Bates family balanced the books and licked its wounds slowly, very slowly, the sun peeped through the clouds over Wanganui.
“Out of every hardship comes opportunity. I think for my father it was a release from something that could have killed him. Dad’s stroke was the basis for a book I wrote called The Laws Of Extreme Business Success, I knew dad’s business had some problems, I wanted to show him the way he could make it a sustainable business. Ironically, he had the stroke and his businesses has gone and now I am travelling the world telling business people like him what they can do to create a sustainable business, moving from being a craftsman to being entrepreneurs. Now, he spends his time doing what he always wanted, he doesn’t have to work, he has no financial pressure and spends his time sketching, painting and recovering. He is exercising every day and slowly getting movement back. He is a case study for Auckland University on stroke recovery.”
Even so, the family feud was not quite over.
“I went home to New Zealand in August 2012. When I went to his house he tried to close the door on me and if my grandmother wasn’t there he wouldn’t have let me in. Then after two minutes in the house he made us go and then his social worker asked me to come back next day. That started us talking and when I came back to South Africa he started skyping me,” says Bates.
“I use this story as an example. I talk about my dad and I think about him all the time.”
Finally, father and son appear on the road to healing the wounds of their worst day.

A Tale Of Sorrow And Salvation

Tales of entrepreneurial success are usually based on events or circumstances that define and distinguish each story. At times, these relate to the individual’s planned or fortuitous foray into a business venture; the painstaking process of building same, a bruising setback or a stroke of fate that leads to the game-changing break. The interplay of these elements is what makes each entrepreneur’s story unique, and in the case of Hakeem Belo-Osagie, the Nigerian entrepreneur and chairman of the mobile telecommunications company Etisalat, the chemistry between these elements is as vivacious as ever.
After more than a decade of running UBA and overseeing a transformation of its fortunes, Hakeem, or Keem as he is widely referred to, shifted his focus to the telecoms industry. Two prior unsuccessful attempts to obtain a license were followed by a successful third bid with the Mubadala Company of Abu Dhabi. The new player, Etisalat Nigeria, rolled out its services six years after the first mobile operator had launched in the Nigerian market. Etisalat became the fourth operator alongside MTN, Glo and Airtel.
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“I had made two attempts to get into the telecoms industry before. The first time was when we had the first bid for GSM and there I was a partner to Orascom. Four licenses were given and we were fifth, so we just missed it. With the second attempt, this time working with Orascom again to buy NITEL, we won, but we were told that our price was too low. I thank God that we were rejected because I think that it would have been very difficult managing NITEL. And then the third time, this time I was not working with Orascom, I was working with a company called Mubadala, which is one of the sovereign wealth funds of Abu Dhabi, and this time we were successful in getting a license and that is the foundation of the company called Etisalat.”
Experts and skeptics predicted a rough ride for the company due to its late entrance into the industry. But since its commencement of commercial operations in October 2008, Etisalat has surprised with its solid growth and achievements. The newcomer had two million subscribers in its first year and gained the reputation of being the most innovative telecoms company in Nigeria. By 2011, it had 12 million subscribers, despite the intense competition in Nigeria’s telecoms sector.
As mobile penetration continues to increase in Africa’s largest telecoms market—with recent figures showing that the aggregate mobile subscriber base has surpassed 100 million—telecom infrastructure continues to mushroom across the country. Etisalat has invested more than $2 billion in building and expanding its network. Of the estimated 20,000 cell sites scattered across the country, Etisalat’s infrastructure accounted for around 15% in 2011. Belo-Osagie points out that the expansion of the company’s network will continue.
“We had some gaps in our network in the South-South and South Eastern part of Nigeria and we are now in the process of filling those gaps, right now we have something in the range of just over 4,000 base stations. We are very happy with our rollout because we think with this number of base stations we can cover the whole country. However, our objective over the next few years is to double that number and get to the range of about 8,000 base stations.”
By October, Etisalat had surpassed its target for the year of 14 million subscribers.
“What we are particularly happy about is our 3G data offering, which we think is universally accepted as the best and the fastest in the market. As a company, we are going to continue to pioneer innovative solutions as we seek to distinguish ourselves from our competitors.”
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True to his words, Etisalat is stealing a march on its competitors in the mobile banking race with its recent introduction of an innovative SIM application called ‘Easy Wallet’. The application, which comes pre-loaded on every Etisalat SIM card, encourages the adoption of mobile phone as the preferred means of conducting basic financial transactions. Belo-Osagie promises that the coming months will see more such mobile money products.
“Well, I think we are very proud of the fact that our partner Etisalat indeed won a prize for having one of the best mobile applications in the world&#8230; at the recent telecommunications conference. In addition to that, we’ve built on the strengths of Mubadala, which is a sovereign wealth fund very much in the area of finance. You will notice that many of the Nigerian directors have, at one time or another, been involved in banking. We felt that it should only be natural that we be a leader in the area in which telecoms and banking cross each other.”
Being the resolute operator that he is, Belo-Osagie wants Etisalat to rise to the second position in the industry.
“I do think though that with the correct strategy we can become the number two [telecom] company in Nigeria. We focus very much on the youth market. We focus very much on the data market and we focus very much on the quality of services. I think we are also helped by the fact that we have two very financially strong shareholders, Mubadala and Etisalat, and we have funded our rollout, so the amount of debt that we have on our books is relatively small. I believe that with the strategy that we have, especially one that has avoided a lot of changes of management which Airtel has gone through, and the depth of management we have in comparison with Glo, I think that we will eventually get to the second position in the market place.”
He describes the challenge of catching up with the market leaders as “a management and intellectual challenge,” which he enjoys. With an air of confidence that is almost palpable, he offers a concise analysis of the industry.
“Realistically, I don’t think that any company can beat MTN in Nigeria because the gap is very large between MTN and everybody else. And while I think that MTN can improve its quality of service, I think that it has a strong management; there is a real commitment to Nigeria from MTN, and they’ve also done a lot in terms of the development of local staff.”
Belo-Osagie’s childhood fantasies had nothing to do with running businesses. His early ambition was to become a mathematician. Later, while studying at a sixth form college in Wales, he developed an interest in public service and went on to study politics, philosophy and economics at Oxford University. He obtained a law degree at Cambridge University before undertaking the Harvard MBA program. While at Oxford, he obtained work experience as an intern at the OPEC headquarters in Vienna.
His graduation from business school would coincide with the enactment of a policy by the Nigerian government that permitted federal ministers and the president’s advisers to employ aides. Through much more than a stroke of luck, Belo-Osagie was appointed as an aide to the president’s adviser on petroleum. He would go on to hold the position for six years, despite a coup d’état that led to the arrest and incarceration of his initial boss. Following another coup, which occurred when he was getting married, he made the decision to abandon the precarious public sector to pursue opportunities in the private sector.
He set up a consulting firm which advised international companies that sought to play in Nigeria’s oil industry. The venture was a resounding success and after a few years and millions of dollars in the bank, his entrepreneurial instinct sparked the hunger for another venture. This led him to cast his attention to the financial sector and, as fate would have it, the Nigerian government decided to privatize banks established by the British, which were still under government control.
Sensing the opportunity, Belo-Osagie cashed in and acquired UBA in a landmark transaction. The consequent modernization of the bank, which he spearheaded, led the bank to remarkable achievements. The UBA acquisition would become the transaction that cemented his reputation as an astute and dogged entrepreneur.
Before the triumph with UBA, Belo-Osagie tasted his share of failure. He set up a financial services company called KMC in the early 1980s.
“We did very badly, but that failure was very useful to me because it taught me a lot about what not to do. One of the things that I believe is that setbacks are a very vital part of life because setbacks strengthen you. You learn lessons from them; you learn to be tough; you learn to be bold. Therefore learning the lessons from the failure of KMC, I, with a group of others, set up First Securities Discount House, which was a great success.”
Despite his media shyness, Belo-Osagie is well-known in business circles locally and internationally. Indeed, he maintains a good friendship with Daniel Yergin, the Pulitzer Prize winning author and energy analyst under whom he authored a special paper on the state of international oil markets, while at Harvard Business School. His calm and unassuming demeanour belies a strong intellect and an uncanny ability to spot lucrative opportunities. This is best reflected by his status as one of Africa’s wealthiest men with an estimated fortune of $400 million, which saw him at number 40 of the ‘Africa’s 40 Richest’ list in December.
When asked about recent calls urging telecoms companies to list on the Nigerian Stock Exchange, he pauses to gather his thoughts, before explaining meticulously and systematically the role that the telecoms industry will have to play in fulfilling Nigeria’s aspirations.
“One way or another, all of us telecoms are going to have to accept that we are living in a certain country, that the country has certain communal, social and national interests and we are going to have to adjust to those interests. I don’t think that the interest of the company and the interest of Nigeria necessarily have to conflict. But I think that there has got to be flexibility on both sides. And I don’t think that the telecoms companies will be successful if they have an attitude that is inflexible. So for me, sooner or later the Nigerian companies will have to list, and I honestly don’t have a problem with that at all.”
Government and telecoms companies should be discussing how the listing process should unfold, with the question being on the various policy options for listing, according to Belo-Osagie.
“Should all the companies be listed? Should it only be companies that have been in existence for a certain number of years, or companies that have reached a certain level of profitability?” he asks rhetorically.
He feels that it will be counter-productive, were government to compel the operators to list. He advises that consultation rather than fiat, should be adopted by government, so that the healthy atmosphere, which he believes the Nigerian government, and to an extent, a lot of African governments have done good to create, is sustained.
As the conversation switches to the subject of the future of Nigeria and Africa, Belo-Osagie points out that he is cautiously optimistic about Africa’s future. He believes that a lot of the growth in Nigeria and Africa stems from the dismantling of many of the barriers imposed by the over extensive state investment and participation in the economy, in African countries. In his opinion, reforms, especially those in the Nigeria, need to be stimulated. He observes further that governments have an important policy role that needs to be refined.
“No matter how effective a private sector is, it cannot generate electricity outside a set of policy measures that determine how everything works together.”
Belo-Osagie believes that a crucial factor to the performance of African economies in the next few years is the extent to which the African public sector is reinvigorated across the continent. He notes that, Africa’s success hinges on the paradox that sees governments relinquishing control in terms of administering the economy, while developing and exercising its capacity to articulate and implement policies. He expresses his concerns that the pace of the policy strengthening across Africa is not taking place fast enough. Comparing developments in Africa with Asia, he says: “Whether it is Japan, Singapore or South Korea, you will see the hand of the government that is pushing, that is encouraging, that is putting together the infrastructure, that is ensuring that a competitive system is established, you will see them in all of those areas. You will see them ensuring that things like airports, immigration, state security, all have the tools to do well in their area. The success of each of those areas is as important to the running of an economy, as is simply giving licenses to private companies”.
Outside his business ventures, the entrepreneur is a generous philanthropist. As one who had the privilege to attend prestigious universities, he is very active in supporting education. He is one of the largest donors to the African Leadership Academy, an advanced level college in South Africa, to which he has given more than $1 million. He announces with pride that the school has named part of the library after him and his wife for their contributions. Keem is also in his third term as president of the King’s College Old Boys Association, the college where he attended secondary school in Lagos in the 1960s. He also sponsors an annual scholarship, The Hakeem Belo-Osagie Scholarship, at Oxford University.
An ardent lover of jazz music and fan of Manchester United, Belo-Osagie takes a broad yet simplistic view of success.
“There is a quotation, which was adapted from something that John F. Kennedy said, defining happiness, which I think is a definition of success as well. He said it’s ‘The full use of ones talents, along lines of excellence, in the life affording one opportunity, and in the direction towards service’. I think that one thing that makes you happy or successful is to know that you are operating at the peak of your abilities. The abilities can be in the carpenter who takes great pride in his craftsmanship, making the great table. It can be the great singer, the great mathematician. ‘In a life affording you opportunity’, by that I mean that to be successful there must be the opportunities for you to exploit, and that part of the kind of society we must create is a society in which more and more people have the opportunities to develop those talents. And in the African societies that we have today, we are not doing enough of that. And then we say, ‘In the direction towards service’, which simply says that the ends, the objectives cannot be solely focused on me, me, me. So I like that definition of success or happiness because it says a lot which I think is important.”
For a person who has traveled the world and been actively involved in business for more than three decades, he clearly knows a thing or two about what success means.

Tag: February 2013

FORBES AFRICA SOCIAL MEDIA

The Tide Turns

A Tale Of Sorrow And Salvation

Africa’s Unassuming Giant