Africa’s leaders, along with everyone else interested in US-Africa relations, have waited eight months for US President Donald Trump’s administration to explain its Africa policy. We aren’t there yet.
But in recent weeks Trump has indicated the level and extent of his interest. And, senior African affairs officials at the State and Defence Departments are at last attempting publicly to outline US goals and objectives toward Africa. This, apparently without much guidance from their president.
Trump’s inaugural address to the UN General Assembly said little about Africa – barely one paragraph <a href="https://www.whitehouse.gov/the-press-office/2017/09/19/remarks-president-trump-72nd-session-united-nations-general-assembly" target="_blank" rel="noopener">towards the end</a>. One sentence praised African Union and UN-led peacekeeping missions for “invaluable contributions in stabilising conflicts in Africa.” A second praised America, which
<blockquote>continues to lead the world in humanitarian assistance, including famine prevention and relief in South Sudan, Somalia and northern Nigeria and Yemen.</blockquote>
The next day Trump hosted a luncheon for leaders of nine African countries – Cote d’Ivoire, Ethiopia, Ghana, Guinea, Namibia, Nigeria, Senegal, Uganda, and South Africa. Only his welcoming remarks have been published but they are nearly devoid of <a href="https://www.whitehouse.gov/the-press-office/2017/09/20/remarks-president-trump-working-lunch-african-leaders" target="_blank" rel="noopener">policy content or guidance</a>. His opening gambit reminded me of a 19th century colonialist hoping to become rich, as he proclaimed:
<blockquote>Africa has tremendous business potential, I have so many friends going to your countries trying to get rich. I congratulate you, they’re spending a lot of money….It’s really become a place they have to go, that they want to go.</blockquote>
Trump called on African companies to invest in the US. Then, shifting to security cooperation, he urged Africans to help defeat Islamist extremists and the threat from North Korea.
The American president proposed no new presidential initiatives for Africa. But, at least, he did not say those launched by predecessors were a waste of money and would be ended. Nor did he mention opposition to foreign assistance generally. He also did not mention his renunciation of the <a href="https://www.theguardian.com/environment/live/2017/jun/01/donald-trump-paris-climate-agreement-live-news" target="_blank" rel="noopener">Paris Climate Accord</a> and refusal to fund <a href="https://www.nbcnews.com/politics/white-house/why-trump-seeing-red-about-green-climate-fund-n767351" target="_blank" rel="noopener">Green Climate Fund</a>. Both are crucial for Africa’s adaptation to global warming.
A “US-Africa Partnerships” conference at the <a href="https://www.sfcg.org/events-schedule/2016-09-13/" target="_blank" rel="noopener">US Institute for Peace</a> in Washington in mid-September provided additional clues to how this administration will conduct Africa policy.
Under Secretary of State for Political Affairs, Tom Shannon, offered the first high level <a href="https://www.state.gov/plus/rem/2017/274073.htm" target="_blank" rel="noopener">official statement on Africa</a>. Shannon, a highly accomplished Foreign Service officer, emphasised policy continuity. But, he implicitly affirmed Trump’s apparent desire for minimal engagement in Africa.
Shannon and Acting Assistant Secretary Donald Yamamoto at a later session, stressed the <a href="http://allafrica.com/stories/201709180753.html" target="_blank" rel="noopener">four main pillars</a> that have framed Africa policy for many years, would remain. These are:
<ul>
<li>peace and security;</li>
<li>counterterrorism;</li>
<li>economic trade, investment and development; and,</li>
<li>democracy and good governance.</li>
</ul>
They endorsed previous presidential initiatives, including specific references to former US President Barack Obama’s <a href="https://www.feedthefuture.gov/" target="_blank" rel="noopener">Feed the Future</a>, <a href="https://www.usaid.gov/powerafrica/aboutus" target="_blank" rel="noopener">Power Africa</a> and the Young African <a href="https://yali.state.gov/" target="_blank" rel="noopener">Leaders Initiative</a>. Their continuation, and at what levels, will depend on budget decisions. Trump’s initial recommendations, endorsed by Secretary of State Rex Tillerson, call for crippling cuts.
So far, the only new social development program that Trump has endorsed is the World Bank’s global Women Entrepreneurs <a href="http://www.worldbank.org/en/programs/women-entrepreneurs" target="_blank" rel="noopener">Finance Initiative</a>, championed by his daughter Ivanka. The US has donated $50 million toward its global start-up budget of <a href="https://www.forbes.com/sites/timworstall/2017/07/08/ivanka-trump-and-40-million-for-women-entrepreneurs-nice-idea-but-trivially-unimportant/#757bef521af2" target="_blank" rel="noopener">$315 million</a>. As Yamamoto noted at the September meeting, Africa could benefit from this initiative.
Trump will be less likely to challenge US military’s commitments in Africa. With this in mind I paid close attention to the <a href="http://allafrica.com/stories/201709140684.html" target="_blank" rel="noopener">address</a> by General Thomas Waldhauser, Commander of the US Africa Command (Africom) at the September 13 meeting. He set out Africom’s current engagements in Libya and Somalia, where he said the mission was to support locally engineered political solutions.
Critics of America’s many previous failed interventions in these two countries and elsewhere, will rightly remain sceptical.
The second part of his address dealt more broadly with Africom’s capacity building assistance, nationally and regionally. He said Africom only operates where
<blockquote>US and partner nation strategic objectives are compatible and aligned and, second, the operations are conducted primarily by partner nation forces with the US in a supporting role.</blockquote>
Africom, he said, conducts “some 3,500 exercises, programs and engagements” annually, with “5-to-6,000 US service members working on the continent every day.”
Waldenhauser ended his address with a surprisingly specific and positive view on China’s role in Africa. He praised China’s assistance to building much needed infrastructure throughout Africa and for the rapid growth in China-Africa trade which exceeded $300 billion in 2016.
On security issues, he commended Chinese President Xi Jinping’s pledge of <a href="http://uhuruspirit.org/news/?x=8706#.WdIYnVuCw9c" target="_blank" rel="noopener">$100 million</a> to the AU and for supporting UN peacekeeping missions with 8,000 police officers. He then referred to the construction of China’s first overseas military base, which is near the US base in Djibouti, as creating “opportunities found nowhere else in the world,” relating that:
<blockquote>China assigned the first soldiers to this base and expressed interest in conducting amphibious training between Chinese and US Marines. Across the continent, we have shared interests in African stability. We see many areas where we can cooperate with the Chinese military. For example, we both support UN peacekeeping missions and training with African defence forces. The fact that we have mutual interests in Africa means that we can and should cooperate.</blockquote>
To emphasise the importance of this comment he quoted Secretary of Defence James Mattis when he pointed out earlier this year:
<blockquote>Our two countries can and do cooperate for mutual benefit. And we will pledge to work closely with China where we share common cause.</blockquote>
But China-US security cooperation in Africa can’t succeed without the inclusion of African governments as equal partners in this “common cause”.
Such “win-win-win” experiments in mutual confidence building would not only benefit Africans, but could also serve as positive examples for other regions and could improve US-China relations globally. In the absence of a coherent and compelling US – Africa policy, this at least is one positive development that merits our attention. &#8211; Written by <a href="https://theconversation.com/profiles/john-j-stremlau-182813" target="_blank" rel="author noopener">John J Stremlau</a>, 2017 Bradlow Fellow at SA Institute of International Affairs,Visiting Professor of International Relations, University of the Witwatersrand
Originally published in <a href="https://theconversation.com/africa" target="_blank" rel="noopener">The Conversation</a>
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Trump’s Africa policy is still incoherent, but key signals are emerging

She was destined to be a teacher but fate had grander plans for the young Graça Simbine. Born in 1945 in rural Mozambique, the youngest of six children, she survived the dismal conditions of Portuguese colonial rule, and rose to being one of the most influential women on the continent.
However, ambition distinguished her early on. A prodigy, Simbine consistently found herself at the top of her class at the missionary schools she attended. Her academic talent led her to become one of the first Mozambican women to win a scholarship to study at the University of Lisbon in 1968 where she focused on German Philosophy and Linguistics.
Moved by the plight of those she left behind during her time in Europe, she became increasingly politicized and began campaigning for the independence movement back in Mozambique. Courting the attention of Portuguese authorities and facing arrest, she eventually abandoned her studies to join FRELIMO [Frente de Libertação de Moçambique or the Mozambique Liberation Front], a political movement that retains substantial popular support to date. Her first posting was as teacher at a school run by the movement in Tanzania where she taught languages and served as deputy headmistress.
<img loading="lazy" decoding="async" class="alignnone wp-image-31841 size-large" src="http://www.forbesafrica.com/app/uploads/2016/04/DSC04281-1024x683.jpg" alt="" width="1024" height="683" srcset="https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC04281.jpg 1024w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC04281-300x200.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC04281-600x400.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC04281-768x512.jpg 768w" sizes="(max-width: 1024px) 100vw, 1024px" />
Respected by her peers and senior officers, as a courageous and articulate member of the movement, Simbine found herself taking on greater responsibility within the movement. On one of those assignments, stationed in Mozambique in 1973, she met Samora Machel, then commander with FRELIMO. They married a year later.
Her standing within the movement earned her an appointment as the country’s first post-independence Education Minister. She held the post for over a decade. During that time, she put in place the foundations of Mozambique’s education system. One of her achievements was pushing primary school enrolment rates from 40% to over 90% for boys and 75% for girls, an absolute increase of 1.5 million pupils nationwide. Today, she remains deeply passionate about ensuring universal access to education for every child, not only in Mozambique but across the globe.
For Machel, education is not merely a right, it is the means to a greater end; political and economic liberation.
“I believe that education is freedom, and it must provide our children with the skills they need to become who they want to be,” she said at a press conference announcing the launch of the African Leadership University (ALU) in Mauritius last month.
Machel believes education for every child is within reach and, despite resource constraints, Africa is capable of providing world-class education to its professional and leadership cadres.
As an experienced policy-maker, Machel understands the importance of strong institutions in addressing intractable social challenges. Social institutions, Machel believes, must be designed to evenly empower citizens to achieve their individual and collective conditions. The challenges within the higher education system in Africa are only symptoms of a system that needs to be rethought.
“There is something quite courageous in interrogating the kind of education we’ve been providing our young people. Our children today are learning the same things that I was taught when I was in school in the 1950s. We never took the time to reimagine our education,” she says.
Commenting on the recent turbulence in South African universities, Machel points out that it is evidence of a systemic rather than a philosophical problem.
“This is not an emotional issue, it’s an issue of economics, it’s an issue of social justice. It is not only about higher education, but all the way down to early childhood development. This is the only reasonable way to look at it. There is a danger of #FeesMustFall playing against the students themselves. There is an issue on deciding who gets the benefits of the new system. We have not yet done the math.”
Machel’s voice on the issue matters.
<img loading="lazy" decoding="async" class="alignnone wp-image-31838 size-large" src="http://www.forbesafrica.com/app/uploads/2016/04/DSC05662-1024x683.jpg" alt="" width="1024" height="683" srcset="https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC05662.jpg 1024w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC05662-300x200.jpg 300w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC05662-600x400.jpg 600w, https://cms.forbesafrica.com/wp-content/uploads/2016/04/DSC05662-768x512.jpg 768w" sizes="(max-width: 1024px) 100vw, 1024px" />
She has served as a Chancellor at the University of Cape Town and as President of the prestigious School of Oriental and African Studies in London. Her argument also makes sense. For an education system to fully play its social role, it must also be accessible to as many people as possible at every stage. The trick is to strike a balance.
“There are only about 100,000 [South Africans] in university today. What about the millions who need to go to secondary school, primary school or kindergarten? We haven’t navigated the mathematics of such a system. You can’t give to tertiary education without taking away from something else.”
Machel is confident transformative solutions exist and only need to be developed. She is currently focusing her energies on the newly-established ALU that is seeking to position itself as the premier leadership education institution in Africa.
“It’s important to look at the future of our continent in the eyes of the human capability that we have. Take the faces and voices of the young people who will come through these doors, we have to present them to Africa and then to the rest of the world,” she says.
ALU is built on “a resource efficient model that pioneers technology and innovative learning to provide high-quality tertiary education at scale”. The university plans to build 25 campuses that would each host 250,000 students each.
But even at those numbers, Machel argues that the university will only address a small portion of the continent’s education needs.
If the challenge today is to provide a solution at scale, Machel reflects, the long-term challenge is to develop institutions that are distinctively African, designed to solve the problems of today but constructed to stand the test of time.

DSC05737

‘Education Is Freedom’

11r the past few years, Kenya has witnessed considerable growth in Shariah-compliant products, a sign of the vast potential of Islamic finance in Kenya. The country now boasts two fully fledged Islamic banks, one fully fledged insurance provider (Takaful), one Islamic fund manager and one approved Collective Investment Scheme (CIS). For all this, as at December 2014, the Global Islamic Finance Report (GIFR), the developers and publishers of the Islamic Finance Country Index (IFCI), an indicator of developments in Islamic financial services, ranked Kenya 22nd globally and third in Africa behind Sudan and Egypt, but ahead of South Africa, Tunisia, Algeria, Nigeria, Senegal and the Gambia.
According to the IMF’s Islamic Finance: Opportunities, Challenges and Policy Options, Kenya is poised to see further contributions in at least three dimensions: greater financial inclusion, especially of large underserved Muslim populations; greater support for small and medium-sized enterprises (SME), due to its risk-sharing features; and the lowering of systemic risk, owing to its prohibition of speculation – a major risk for conventional finance. Clearly, the decision to amend the Central Bank Act, allowing the monetary authority to recognize the payment of profits based on income from underlying assets rather than interest on government securities, thereby opening up the spectrum of Sharia-compliant investments, was a sound one.
Kenya is now gearing up to issue its eagerly-awaited Sukuk (Islamic bond) in the 2016/2017 fiscal year, hoping to limit domestic borrowing and increase funding for mega infrastructure projects. The government appears to be following in the footsteps of Senegal and South Africa, both of which managed to raise $200 million and $500 million respectively through Sukuks. Countries and companies raise $100 billion globally every year through Sukuks, with African countries accounting for just 1% of the issues. The planned sovereign issue is also set to pave the way for the private sector and further development of Kenya’s capital markets.
From a sovereign perspective, through Islamic bonds, the Kenyan government will able to access a new investor base. According to a report by Standard &amp; Poor’s (S&amp;P), the Islamic Sukuk investor base is estimated to be over $500 billion, excluding sovereign wealth funds, official investors (central banks and multilateral organizations), and other conventional investors. Essentially, the move will tap into a vast pool of Persian wealth.
Sukuk bonds are known to offer more favorable repayment terms than conventional bonds and therefore attract infrastructure financing. It’s also worth noting that investors from the Middle East accounted for only 2% of Kenya’s debut Eurobond. The planned Shariah-compliant bond should see a ramp up in participation.
Individual investors in the country are also set to benefit immensely as Shariah-compliant products are not restricted to Muslims. What is also vital, perhaps due to its unique qualities, is that Islamic finance has become a good vehicle to diversify risk away from traditional asset classes. It is noted that Sukuk bonds and other financial instruments avoided many of the most severe consequences of the recent financial crisis because they were underpinned by equity, as opposed to debt. For instance, while the S&amp;P 500 dropped 64%, Shariah-compliant indices lost no more than 53% and showed lower volatility, according to KPMG’s report, Islamic finance: From niche to mainstream.
Although Islamic finance has already taken off, there are some challenges facing the niche market. In January, the first International Islamic Finance Conference of Africa was held in Nairobi. It highlighted issues around regulations, investor education, compliance, and the limited range of available products and services. Kenya needs to deal with these challenges to see a smooth increase in Islamic financial products in its financial markets.
As the country positions itself as a financial and investment hub to tap into the growing capital inflows into Africa, it is important to celebrate the milestones achieved so far while working to improve further. With Islamic finance set to grow to $3 trillion within the next decade, according to S&amp;P’s report: Islamic Finance To Still Grow In 2016 But With A Sag, rising popularity of Shariah-compliant products in Kenya will surely contribute to the country’s growth story.

Islamic Finance On  The Rise In Africa

With the new South African visa regulations, it’s not just the small B&amp;Bs taking a hit – the high-end is feeling the effects too.
Foreigners who want to visit South Africa must apply for visas in person at South African embassies to have their biometric data captured. Residents of countries who require a short-stay visa for South Africa, and do not have a South African embassy in their country or city, will have to travel. Parents and guardians traveling with children must be in possession of an unabridged birth certificate.
The travel and tourism sector directly employs an estimated 679,500 people, is growing at a rate of 3% and contributes directly and indirectly to 9.4% of South Africa’s GDP. But Cape Town’s top-end is feeling the brunt of the legislature. The Westin, at R2,330 ($167) a night, is situated at the entrance of the Victoria &amp; Alfred Waterfront; with views of Table Mountain, Lion’s Head and the entirety of Table Bay. Within walking distance from town it’s a firm favorite for tourists. It’s an easy sell but the five-star hotel has already taken a hit.
“At The Westin, we have started to see the ramifications that the new visa regulations is having on the tourism industry. Damage to the local tourism industry has already begun.  We definitely anticipate a lull for the festive season this year. A further concern is the collateral damage that comes from this, such as the strain on the South African economy as well as job loss,” says Rob Kucera, FEDHASA (Federated Hospitality Association of South Africa) Cape Chairman and GM for The Westin Cape Town.
Occupancy rates have dropped significantly for The Westin. A study commissioned by the Tourism Business Council of South Africa said the tourism industry lost R886 million ($63 million) in direct spending last year because of the regulations and fears that Ebola might spread from West Africa. It’s estimated that South Africa is set to lose 100,000 tourists this year, translating into a R1.4-billion ($100 million) loss.
“We have changed our strategy to find business in other market segments and countries. We have taken a hit over our current winter period and the upcoming season will not be as good as last year,” says Kucera.
“There is no doubt that due to the new visa regulations we have challenging times ahead. As the industry body for the hospitality sector we are committed to encouraging these conversations for the benefit of the tourism industry and ultimately to safeguard the international tourist impression of South Africa as a holiday destination of choice,” he says.
South Africa’s President Jacob Zuma announced that a new inter-ministerial committee has been established to deal with the unintended consequences of the new travel visa regulations. The regulations are coming under fire – not only for the effects on the tourism industry but for the justification of them. The consequences come at a bad time for South Africa; the economy shrank by an unexpected 1.3% in the second quarter.
Tourism minister, Derek Hanekom, admits tourism has been hit. He said the number of visitors from China, one of South Africa’s major markets, has dropped by nearly 40% – and the numbers for other markets were similar.
In defense of the regulations, Home Affairs director-general Mkuseli Apleni briefed parliament. In his report, he claimed an estimated 30,000 children, 50% of whom are under the age of 14, are trafficked through South Africa every year, and that the new regulations would protect those children. The figure has since been dispelled by Africa Check and in parliament, it was stated that 23 children had been trafficked in a three-year period.
With too much room in the inn on all fronts, the tourism industry’s fears are mounting

Too Much Room In The Inn

Terrorism in Africa did not begin on September 11, 2001. It began in Sudan in the 1990s, where Osama bin Laden operated and where an attack against Egyptian president Hosni Mubarak was organized.
Three years later, in 1998, Al Qaeda cells blew up the American embassies in Nairobi and Dar es Salaam.
In retaliation for these attacks, the United States (US), in addition to an attack in Afghanistan, bombed a chemical plant in Sudan, claiming that it was producing elements for chemical weapons for Al Qaeda.
From the time of these attacks, US policy in Somalia became preoccupied with searching for, capturing, and killing the perpetrators of those attacks who were believed to have taken refuge there.
<div id="attachment_2882" style="width: 310px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-2882" class="size-medium wp-image-2882" src="/wp-content/uploads/2017/04/000_Par7496840-300x221.jpg" alt="" width="300" height="221" />A picture taken from a video distributed to Nigerian journalists in the country&#8217;s north in recent days through intermediaries and obtained by AFP on March 5, 2013 reportedly shows Abubakar Shekau (C), the suspected leader of Nigerian Islamist extremist group Boko Haram, flanked by six armed and hooded fighters in an undisclosed place. The suspected leader of Nigerian Islamist group Boko Haram denies any ceasefire deal with the government in a video obtained today. Abubakar Shekau makes no mention of kidnappings in the video, including last month&#8217;s abduction of seven members of a French family. Boko Haram was blamed for the kidnapping that occurred just over the Nigerian border in Cameroon. RESTRICTED TO EDITORIAL USE &#8211; MANDATORY CREDIT &#8220;AFP PHOTO / BOKO HARAM&#8221; &#8211; NO MARKETING NO ADVERTISING CAMPAIGNS &#8211; DISTRIBUTED AS A SERVICE TO CLIENTS</div>
The seeds of later US policy and all that has followed in Somalia were planted then.
Yet the vast majority of conflict and terrorist activity in Africa is not linked to international sponsorship or any vast conspiracy against the West.
The Lords Resistance Army in Uganda, the various militia in eastern Congo, the militants in the Niger Delta, the extremist sects in Kenya, Nigeria, and elsewhere are the principal security threats to the African population.
Africa is no more immune to the threats from terrorism than any other continent.
Its combination of relatively weak states, ethnic and religious diversity and sometimes discrimination, its poverty, and in many places its ungoverned space all lend Africa a significant susceptibility to the growth of radical and sometimes internationally connected movements that employ terrorism.
Some of these are aimed specifically at African governments, for example, the radical Islamic Boko Haram in Nigeria or the Mombasa Republican Council in Kenya.
These groups pose serious security challenges to key countries and potentially even a threat to the continent’s new success.
The biggest story in Africa south of the Sahara over the past few years hasn’t been plague, famine or war but the emergence of the world’s poorest continent as one of its fastest growing – thanks to factors that include fresh investment, economic reform, the spread of new technology, higher prices for commodity exports and generally greater political stability.
Nigeria and Kenya, the most important economies in West and East Africa respectively, are pillars of the change in Africa as well as having the largest and most easily accessible markets for foreigners.
Both now face growing battles with Islamist groups; Kenya throwing troops into neighboring Somalia in pursuit of Al-Shabaab fighters, Nigeria struggling with bombings and shootings by its home-grown Boko Haram sect.
Kenyan forces pushed into southern Somalia to drive back Al Qaeda-linked militants, blamed by Nairobi for a string of border incursions and kidnappings, including the abductions of foreign tourists from coastal resorts which have damaged one of Kenya’s most important industries.
Al-Shabaab has in return called for all-out war on Kenya and ‘huge blasts’ by its unknown number of supporters there. Grenade attacks, that have seen many killed and several wounded, jangled nerves in Nairobi, where more than 200 people died in an Al Qaeda bombing of the US embassy in 1998.
Killings by Nigeria’s Boko Haram sect &#8211; whose name means Western education is sinful &#8211; had been largely confined to a remote corner of the semi-desert northeast and ignored by much of the country until bombings struck the capital Abuja, killing hundreds. A suicide car bombing on the United Nations headquarters in August killed 24 people.
Boko Haram is now by far the biggest security headache for President Goodluck Jonathan in Africa’s most populous nation – which, if estimates of population and the Muslim-Christian balance are to be believed, might have more Muslims than any country in the Middle East.
While Islam in Africa has traditionally co-existed comfortably with other religions, more heavily populated Muslim regions are often relatively marginalized economically and politically. This leaves plenty of ground for radicalism to sprout.
Getting sucked into a foreign war against a Somali enemy, which drove out Ethiopia’s far more experienced army in 2009, is just what Kenya doesn’t need at a time when it is already in the doldrums due to drought, soaring inflation and a plummeting currency.
It is not only the cost in lives and money that count.
Counterinsurgency wars – even in regions distant from the main centers of business – can harm foreign investor sentiment starting to warm to Africa. They drain resources that might better be used improving infrastructure or education and lead to a greater role for security establishments at the heart of power and policy making, rarely a recipe for success in post-independence Africa.
Beyond the biggest countries, poorer neighbors may be at greater risk. A flood of weapons across the Sahara desert from Libya’s civil war – as well as hundreds of thousands of now unemployed former migrant workers – could further destabilize West Africa’s Sahel countries, already prey to kidnappings and attacks by Al Qaeda’s regional offshoot.
The challenge in combating terrorism in Africa is balancing a legitimate program of security improvements with a continuing and sustained attack on poor governance, poverty, and deprivation of human rights.
Getting the balance right is particularly acute because the democracies in Africa are fragile, and any crackdown on terrorist activity has to be carried out with great sensitivity to the historic grievances of marginalized groups, the incipient struggle for human rights, and the relatively weak civilian oversight of the military and security institutions.
Overall, optimism remains strong. Businesses compare Africa with China and India in past decades and eye a market of a billion consumers with money to spend on more than just basic survival.
Whether or not the threat of Islamist militant groups can be contained to the margins, the extra strain could certainly be felt in a continent where many have only recently seen good reason to believe in a better future.

Be Afraid

It’s the three-letter acronym, with a sting, that few can ignore. BEE—Black Economic Empowerment—is a decade old this year and has rarely been free of controversy.
Questions are being asked about whether BEE has brought more people of color into the South African economy or reached its expiry date.
There are many critics of the ruling African National Congress’ (ANC) policies. They claim that BEE has far from closed the gap between rich and poor, despite South Africa’s solid economic infrastructure and increased social welfare spending. South Africa’s GINI co-efficient numbers—the global measurement of inequality—remain among the highest in the world.
Professor Adam Habib, political commentator and new vice-chancellor of the University of Witwatersrand in Johannesburg, says BEE was never intended to be a policy to bring previously disadvantaged South Africans into the economic mainstream, even though it was presented as such. For him BEE was an exercise in exquisite deception.
“The ANC’s aim was not to deracialize the economy, through investing in small business or entrepreneurs, but a critical decision to deracialize the apex of white business in South Africa, which they did and created a class of capitalistic and parasitic bourgeoisie,” says Habib.
Habib uses the word “parasitic” because he says the BEE super elite have not created new business, promoted Greenfield projects or stimulated job creation or entrepreneurship that’s sustainable or meaningful.
“The irony is, it’s easier to get a tender worth R250 million ($25 million) than it is to get R25,000 ($2,500) to start a small business,” he says.
Habib says, the policy needs a complete overhaul. As he puts it: “Pigmentation becomes a tradable commodity in South Africa.”
His three checkboxes to justify BEE are: for small business development to be prioritized; a “one bite at the cherry” clause to apply for those who benefit from BEE deals; and firm action to stimulate new enterprise.
Moeletsi Mbeki is less confident that there is anything worth salvaging from the policy enacted during his brother, Thabo Mbeki’s, presidential tenure. He says BEE has not benefitted the majority of South Africans, black or white.
“In the 10 years of BEE, what we’ve learnt was that it was an important device to create an economic oligarchy for the politically connected, which was always the aim. The majority of South Africans, black or whites, are no better off because of policies like BEE or affirmative action,” says Mbeki.
“The ANC needs BEE to continue to perpetuate the illusion that everyone can enter into this circle of wealth.”
BEE has come with a complex system of scorecards, codes and charters that cut across two broad aims of skills development and employment equity. It is broken down into additional categories and indicators so government can assess companies for BEE compliance.
The ANC’s man on economic transformation is Enoch Gondongwana, who failed to respond to FORBES AFRICA’s requests for comment.
The party’s secretary general, Gwede Mantashe, has criticized BEE, saying he has “serious grievances with BEE focusing on shareholding rather helping beneficiaries gain a deeper understanding of business”.
Mantashe has slated a lack of transformation, saying the new breed of black CEOs is mere window dressing. He has also criticized growing wastage as BEE companies use the state as a cash cow, by providing poor quality goods at inflated prices.
The Black Management Forum (BMF) disagrees and says BEE has to continue because it serves the country’s growth and development needs.
“BEE is a moral initiative to redress the wrongs of the past. It’s also a pragmatic growth strategy that aims to realize the country’s full economic potential, while helping to bring the black majority into the economic mainstream. Given the fact that the economy has not transformed to encourage participation, which reflects the demographics of South Africa, makes talk of a ‘sunset clause’ irrelevant and premature,” says Rowena Baird of BMF.
Baird argues that BEE is not a racially divisive policy because its aim is not to take wealth from one group to give to another.
There are lessons from countries such as Malaysia that embarked on a 20-year-long National Economic Policy (NEP) in 1970. It was meant to eradicate poverty and restructure society, to eliminate the identification of race in economic life. It promoted affirmative action in favor of Malays but also had the effect of pushing Chinese economic, educational and cultural life to society’s periphery, leading many Chinese to feel like second-class citizens.
For Mamphela Ramphele, former managing director of the World Bank and leader of new political party Agang, the Malaysian story should be a warning to South Africa that making citizens feel alienated is a recipe for disaster.
“BEE can only work if it has real intentions to redress the legacy of the past that systematically disadvantaged black people,” she says.
Ramphele says that more structured programs need to be in place. She says well planned employee share schemes can mean money in the pockets of a wider range of previously disadvantaged individuals.
The South African Institute of Race Relations (SAIRR) says racial inequality has been declining, but it’s not because of the post-apartheid policies.
Anthea Jeffrey, head of special research at the SAIRR, says: “Such inequality has been declining steadily since 1970 and started under the Nationalist Party.”
Factors she cites include rising skills, unionization, and better paid jobs for Africans.
“Redistribution via the budget has played a vital part; 16 million people are now on social grants. The government also provides free RDP houses, free schooling in 60 percent of schools, free healthcare to many, and free basic water and electricity to the indigent. In addition, public sector employment has been steadily expanding, while average wages in the public sector, where Africans predominate, outstrip those in the private sector by around 40 percent,” she says.
“Despite its evident successes, racial inequality remains stark. The poor are far from being content as rising social and labor unrest makes clear. The number one aspiration of adults living in relative poverty is to get a job,” says Jeffrey.
Unequal skills and a lack of opportunity divide; makes policies like BEE and employment equity irrelevant to the poor because legislation doesn’t bring them in from the cold.

Paragons Or Parasites?

Adam Kahane is worried. The world-renowned facilitator, who helped shape ANC planning at the dawn of South Africa’s transition to democracy, has warned that the state lacks capacity to solve complex problems; that the citizenry is responding with protest and that the government, in return, reacts with brutal repression.
Kahane—a pivotal figure during the Mont Fleur scenarios in 1991 and 1992, that helped to shape South Africa’s democratic and economic thinking—was a central figure four years ago when the Dinokeng Scenario team came together to take stock of where South Africa was and to consider possible futures for the country.
In 2008, along with the Dinokeng team, he warned about a walking apart-scenario for the future of South Africa in which the state becomes weaker and ineffective, and that the disengaged citizenry loses patience and erupts into violence. The state then responds brutally.
Kahane said in an interview with FORBES AFRICA the walking apart-scenario is an apt description of Marikana  where scores of miners were shot dead at a mine owned by multi-national, Lonmin.
It is not a question of the state being weak morally, but its capacity has weakened to deal adequately with the challenges of society, he says.
“Some pockets of the state [are] strong, but on balance, its capacity is not strong enough to deal with the
problems effectively.
“All the scenarios that we discussed at Dinokeng coexist currently in South Africa, but what happened at Marikana, with social groups not getting what they think they deserve and protests erupting, and the state responding violently, makes this a catastrophic walking apart.
“All the mechanisms of solving disputes, between workers and trade unions, between citizens, the police and the state failed. It was a failure of mechanisms for working out disputes.
“Marikana shows that our capacity to work out difficult complex conflicts is degrading. In fact, it was a catastrophic degradation,” says Kahane.
He also warned that South Africans will have to rediscover their extraordinary capacity to work things through, instead of superficially papering things over.
Some observers have called Kahane a critical and pivotal figure in helping to shape South Africa’s economic thinking in the two years prior to the 1994 elections.
Clem Sunter, South Africa’s foremost corporate scenario practitioner, might have had Kahane in mind in January 2010, when he said that Africa had navigated its own transition to democracy and the global recession, “So take a bow, all you who were involved in the Mont Fleur initiative. You may have changed our history at a critical juncture in the fortunes of the world.”
But Kahane denies that his role was ‘pivotal’. He argues a meaningful role is a more apt description and salutes the impact of Trevor Manuel and Tito Mboweni on the ANC think tank during the Mont Fleur scenario discussions.
The Mont Fleur scenarios team questioned how South Africa’s transition will proceed and whether the country would succeed in taking off.
One of the dark prophecies that the country wanted to avoid, was Icarus, in which a constitutionally unconstrained black government comes to power on a wave of popular support and embarks on a huge and unsustainable public spending program, which crashes
the economy.
Manuel and Mboweni presented the Icarus scenario to the ANC’s leadership team. Icarus was a direct attack on the party’s orthodoxy.
Mont Fleur helped to shift the economic thinking and action of the ANC to avert an economic disaster.
“The post-1994 government had been more conservative and fiscally disciplined in its economic policies than what they were expected to be. Mont Fleur had a broad impact on the specific question to what constitutes a sustainable economic policy,” says Kahane.
“Trevor Manuel and Tito Mboweni had created the scenario and understood inside out what it meant. So I would not take personal credit [for shaping the ANC’s economic thinking], but Mont Fleur [had] made a useful contribution,” he says.
Asked whether the vibrant and vigorous debate about the nationalization of the mines presented a possible return in the ANC engine-room to socialist thinking, Kahane said one must understand the global debate about the matter.
“Not only in South Africa, but globally, the faith in markets and in the current form of capitalism that we had in the late 1980s and the 1990s has been eroded substantially. The SA government is trying to figure out what is the best way to get the social and economic results we want. In 1992, during the Mont Fleur scenarios, [the faith in capitalism] was much more credible that it is now.
“Globally there is a reopening of the question on sustainable economic models. In South Africa there are specific challenges about the extremely poor and about economic inequality which has worsened in a certain way since 1994.”
Kahane said the economic debates in South Africa are not entirely a parochial matter, but are vigorously debated elsewhere.
When Kahane and the Dinokeng-team debated possible options for the future, the most positive one was ‘Walking Together’. This tells the story of a state that becomes increasingly collaborative, listens to its citizens and leaders from different sectors and engages with critical voices.
When asked how South Africa can produce the Walk Together option, Kahane said changes by government won’t necessarily fulfill the ‘Walk Together’ scenario.
“The citizenry must increasingly stand up and say: this is what we need, think and what we want. The government might then readily or grudgingly respond to these voices.
“I think it is important that ‘Walk Together’ is driven by the citizens, and not by the state. The state will always generally have a tendency of saying, ‘We will take care of this, why don’t you keep quiet and let us do the job’. It is an error to wait for the state. The citizenry must push the country and state into walk together,” he says.
Although the drive by the citizens should not be a violent one, it is not necessarily a calm phenomenon. People will shout and push and shove, there might even be a cacophony of voices that must be tolerated in order to move to a ‘Walk Together’ scenario.
The mechanisms, cultures or institutions that allow conflicts to be addressed, even noisily, is sadly absent, he notes.
Kahane not only nudged South Africa towards a peaceful resolution, or helped post-dictatorship Guatemala move beyond the longest civil war in the history of the Americas. He and Reos Partners, of whom he is a director, have also been involved, intimately, in Zimbabwe with scenario planning and have released a document called The Great Zimbabwe Scenarios Project. They are also involved in Southern and Northern Sudan, in Europe, America and Australia.
A man equipped with such enormous insights and the author of the recently published book Transformative Scenario Planning: Working together to change the future, Kahane could offer some advice on how to arrest the current malaise in South African society, the hardening of the stance between government and some sections of society.
And Kahane says the possible answer lies in the excavation, the rediscovery of the capacity for dialogue and for collaborative action in South Africa.
“I have learned my craft in South Africa. South Africans have an extraordinary capacity to work things through. This existing capacity must be un-buried,” he says.
“We are always in a seesaw between walking together and walking apart. We are in a phase now where trust is low, polarization is high. It is about protecting myself and my people. It leads to walking apart.”
“Perhaps combinations were made that [were] superficial. Perhaps real economic, cultural or political differences were papered over. I said in a previous book of mine that love without power that papers over differences, is sentimental
and endemic.”
Kahane said the current situation might require a deeper capacity for engagement in which society and the state deal with difficult unresolved issues.
“A superficial coming together is inadequate. Difficult work is needed. We need to look at conflicts squarely and not pretend they are not there. We might be more wounded than we think we are, for untreated wounds are dangerous,” says Kahane.

Whither The Free Market

The city of Mutare, set in a hollow on the Zimbabwe-Mozambique border, is sweltering under another blue sky. In this border town hemmed in by dramatic mountains, a small scene is being played out in the historic stage play that is Zimbabwe’s indigenization policy.
The lead actor is 52-year-old Charles Tawazadza—a man who has gone from manager to boss at this busy dry dock almost overnight, thanks to the country’s attempt to give black Zimbabweans a larger slice of the economy.
<div id="attachment_143" style="width: 484px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-143" class="size-large wp-image-143" src="/wp-content/uploads/2017/04/Dryport_4-801x1024.jpg" alt="" width="474" height="606" />Mutare Dry Port, Charles Tawazadza</div>
“When you talk about this wealth, you are talking about the wellbeing of generations. We did not borrow this land or economy from our ancestors. We borrowed it for the future generations to come. If we don’t acquire it and make good use of it, future generations will be spitting on our graves instead of praising us,” he says.
The company, through which Tawazadza now strolls confidently in his corporate uniform, is one of thousands of foreign-owned outfits across Zimbabwe that appear destined to be taken over by people born and bred in the country. They range from mines to banks and safari companies. The Empowerment Ministry has threatened to revoke or suspend operating licences for more than 500 foreign owned companies, which haven’t yet fallen in line. That is a lot of valuable equity up for grabs and the word is the well connected are hovering.
Tawazadza has taken over Mutare Dry Port, a shipping cargo company with a $3 million asset value. It used to be called GMS Cornelder and had been owned by Mozambican investors since 2000. When pressure came to hand over 51% of the equity, the Mozambicans put forward Tawazadza, who had worked in management at the company for many years, to take control and settled for being minority shareholders.
Even Tawazadza’s name fitted—in Shona it means “to fill up”. Mutare Dry Port has rail sidings with a holding capacity of 24 wagons, a general and bonded warehouse, plus container handling equipment. It has global networks through partnerships operating under specialized air and ocean freights, road and rail transportation, and warehousing and container handling. It means everything from second-hand cars from Japan, to fruit from South America, arrives at Mutare Dry Port to fill up the rolling stock. Many of the goods arrive at docks in Beira in Mozambique and are shipped by rail to Mutare.
Rail runs into Tawazadza’s huge transit shed and container yard, which handles 180,000 tons of shipments every month. There’s even a runway—a legacy of the British Royal Air Force, which used the site as a base during World War II. Tawazadza compares the indigenization laws to the 2000 seizure of farms by liberation war veterans. He says they too are part of an “economic emancipation” program to empower black people.
Against the allegations that these deals are merely for political cronies, Tawazadza says: “I have never met Mugabe. The laws are not anything to enrich Mugabe. He was our leader during the liberation struggle, and he is our leader today in this struggle for economic emancipation. “If you look at the noise which is coming out of the indigenization and economic empowerment, it will come to pass,” Tawazadza says.
The whites in Zimbabwe, Tawazadza says, are “calledRhodesians because Cecil John Rhodes was here to create wealth for them. And this is what President Mugabe is doing for us.” President Mugabe’s jumbled commercial farm seizures have reduced agricultural production, leaving unexploited farms, after driving out over 4,000 former white farmers in the name of an agrarian revolution. Independent economist John Robertson claims farm production is 60% down compared to 1998, although government figures refute this. “Over 4,000 white farmers have been replaced by over 400,000 black owners. All these blacks represent Mugabe’s vision,” Tawazadza said. “People are negotiating and cutting deals without government intervention. I acquired this company on my own.
No one from government came to negotiate on my behalf,” Tawazadza said. But the laws could prove a Pyrrhic victory for a country desperate to emerge from a long recession. Capital could dry up, and the capacity of Zimbabweans to borrow and increase production may be limited. Investors say the laws could scare foreign companies with concerns about property rights, leaving Zimbabwe as a hard sell.
Ray William Black, of Investec Securities, said at a recent investor conference in Harare: “The economy of Zimbabwe has been improving over the last years, but to attract investment, foreign investors have a choice to make. If one country has more onerous conditions than another, then investment will stay away.
<div id="attachment_144" style="width: 484px" class="wp-caption alignleft"><img loading="lazy" decoding="async" aria-describedby="caption-attachment-144" class="size-large wp-image-144" src="/wp-content/uploads/2017/04/Dryport_5-1024x655.jpg" alt="" width="474" height="303" />Mutare Dry Port, Charles Tawazadza</div>
“No country should make it too difficult for investors if they want to attract money. In Zimbabwe, companies that have been operating are caught between a rock and a hard place. They are already under immense pressures, and facing major changes.”
Back in Mutare, Tawazadza has plans to expand and turn his company into a $10 million asset. For a man in the cargo business, with a name that means filling up, there is no turning back or thought of unloading his new business.

Tag: Policy

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