Category: Opinion Piece

  • “Trump’s unfounded attack on Cyril Ramaphosa was an insult to all African”-President John Dramani Mahama

    If we want to solve injustices in Africa today, we cannot forget the injustices that shaped our shared history
     
    The meeting at the White House between Donald Trump and the South African president, Cyril Ramaphosa, was, at its heart, about the preservation of essential historical truths.
     
    The US president’s claims of white genocide conflict with the actual racial persecution and massacres that took place during the two centuries of colonisation and nearly 50 years of apartheid in South Africa.

    It is not enough to be affronted by these claims, or to casually dismiss them as untruths. These statements are a clear example of how language can be leveraged to extend the effects of previous injustices.

    This mode of violence has long been used against Indigenous Africans. And it cannot simply be met with silence – not any more.

    The Kenyan writer Mzee Ngũgĩ wa Thiong’o wrote: “Language conquest, unlike the military form, wherein the victor must subdue the whole population directly, is cheaper and more effective.”

    African nations learned long ago that their fates are inextricably linked. When it comes to interactions with the world beyond our continent, we are each other’s bellwether.

    In 1957, the year before my birth, Ghana became the first Black African country to free itself from colonialism. After the union jack had been lowered, our first prime minister, Dr Kwame Nkrumah, gave a speech in which he emphasised that, “our independence is meaningless unless it is linked up with the total liberation of Africa”.

    Shortly after, in 1960, was the Sharpeville massacre in South Africa, which resulted in 69 deaths and more than 100 wounded. In Ghana, thousands of miles away, we marched, we protested, we gave cover and shelter.

    A similar solidarity existed in sovereign nations across the continent. Why? Because people who looked like us were being subjugated, treated as second-class citizens, on their own ancestral land. We had fought our own versions of that same battle.

    I was 17 in June 1976, when the South African Soweto uprising took place. The now-iconic photo of a young man, Mbuyisa Makhubo, carrying the limp, 12-year-old body of Hector Pieterson, who had just been shot by the police, haunted me for years.

    It so deeply hurt me to think that I was free to dream of a future as this child was making the ultimate sacrifice for the freedom and future of his people. Hundreds of children were killed in that protest alone. It is their blood, and the blood of their forebears that nourishes the soil of South Africa.

    The racial persecution of Black South Africans was rooted in a system that was enshrined in law. It took worldwide participation through demonstrations, boycotts, divestments and sanctions to end apartheid so that all South Africans, regardless of skin colour, would be considered equal.

    Nevertheless, the effects of centuries-long oppression do not just disappear with the stroke of a pen, particularly when there has been no cogent plan of reparative justice.

    Despite making up less than 10% of the population, white South Africans control more than 70% of the nation’s wealth. Even now, there are a few places in South Africa where only Afrikaners are permitted to own property, live, and work.

    At the entrance to once such settlement, Kleinfontein, is an enormous bust of Hendrik Verwoerd, the former prime minister who is considered the architect of apartheid.

    Another separatist town, Orania, teaches only Afrikaans in its schools, has its own chamber of commerce, as well as its own currency, the ora, that is used strictly within its borders.

    It has been reported that inside the Orania Cultural History Museum there is a bust of every apartheid-era president except FW de Klerk, who initiated reforms that led to the repeal of apartheid laws.

    Both Kleinfontein and Orania are currently in existence, and they boast a peaceful lifestyle. Why had the America-bound Afrikaners not sought refuge in either of those places?

    Had the Black South Africans wanted to exact revenge on Afrikaners, surely, they would have done so decades ago when the pain of their previous circumstances was still fresh in their minds. What, at this point, is there to be gained by viciously killing and persecuting people you’d long ago forgiven?

    According to the UN Department of Economic and Social Affairs, half of the population of South Africa is under 29, born after the apartheid era and, presumably, committed to building and uplifting the “rainbow nation”. For what reason would they suddenly begin a genocide against white people?

    Ramaphosa was blindsided by Trump with those unfounded accusations and the accompanying display of images that were misrepresented – in one image, pictures of burials were actually from Congo. Trump refused to listen as Ramaphosa insisted that his government did not have any official policies of discrimination.

    “If you want to destroy a people,” Archbishop Desmond Tutu once said, “you destroy their memory, you destroy their history.” Memory, however, is long. It courses through the veins of our children and their children.

    The terror of what we have experienced is stored at a cellular level. As long as those stories are told, at home, in church, at the beauty and barber shop, in schools, in literature, music and on the screen, then we, the sons and daughters of Africa, will continue to know what we’ve survived and who we are.

    Mzee Ngũgĩ wa Thiong’o wrote: “The process of knowing is simple. No matter where you want to journey, you start from where you are.” We journey forward with a history that cannot be erased, and will not be erased. Not while there are children dying in the mines of the Congo, and rape is being used as a weapon of war in Sudan.

    Our world is in real crisis; real refugees are being turned away from the borders of the wealthiest nations, real babies will die because international aid has been abruptly stopped, and real genocides are happening in real time all across the globe.

    SOURCE

    THE GUARDIAN ONLINE

  • Boosting Ghana’s Industrial Development: A Strategic Approach-(By:Charles Dzradosi)

    Boosting Ghana’s Industrial Development: A Strategic Approach-(By:Charles Dzradosi)

    Former Secretary,Avetime-Vane Citizens Association

    First Edition published in the Evening News of July 4th 2001

    Introduction

    After a sharp contraction of 1.7% in 2023, Ghana’s industrial sector rebounded with a strong 7.1% growth in 2024, driven by mining, manufacturing, construction, and electricity.

    The 2025 Budget has projected a modest 4.8% growth in 2025. The 2024 performance, compared with the projected growth for 2025  has been the subject of some debate among analysts, but no clear reasons have been offered to explain the low projections.

    Even though there are various theories being propounded as explanations to Ghana’s generally  slow down in industrial growth over the last three decades, not much has been achieved especially in the manufacturing sub-sector, beyond the flagship programmes promoted over the last ten years.

    Personally, I think that what has been lacking for many years is the necessary political will to deal with some of the structural and attitudinal issues at stake.

    However, on the other hand, because of the complex challenges facing the nation as a whole, I believe it takes more than just a change in government policy or political will to grapple with the problems and challenges of the industrial sector as a whole, and the manufacturing sub-sector in particular.

    Reviewing Trade Liberalization

    There is no doubt that the current structure of the economy of Ghana favors the importation of all kinds of products, and encourages the buying and selling of foreign goods in the country.

    Trade liberalization policies over the decades have opened up the economy to more foreign imports of industrial goods and processed foods. Whiles this has to some extent challenged local industries to be more efficient and innovative, some of them cannot compete on the local market because of the relatively low import tariffs levied on the competing imported products.

    The result is that local industries – both large and small are unable to expand and grow substantially. More and more people are therefore leaving agriculture and small-scale industrial production and going into the buying and selling business.

    To help arrest this trend, ASSI, AGI, Ghana Employers Association, TUC and other stakeholders must work with government to review import duty levels on selected imports, and also review the trade liberalization policy in general.

    Changing attitudes of society

    On the other side of the coin Ghanaians must reassess their tastes for foreign goods and learn to appreciate Ghana-made products. Questions are always been raised about the quality of some Ghanaian products. But many forget that barely sixty years ago the Japanese were associated with poor quality goods.

    Where is our national pride? The “Adjoa Yankey” tag that was placed on Ghana-made batik especially in the late 1980s was not an issue of the quality of the batik, but of the mentality that low-priced and affordable locally produced cloth is of low value. Now more than ever before, the slogan – “Buy made in Ghana goods!” must become one of the cornerstones of the country’s industrialization strategy.

    Encouraging positive business ethics

    Another attitudinal problem facing our industrial development is the individualism and one-man-business culture among most Ghanaian entrepreneurs. This negative business attitude does not help promote the sustainability of enterprises.  It is a well-known fact that many Ghanaian enterprises flourish and die off with the life-cycle of the founder.

    To arrest this problem, schools, polytechnics and universities for the learning of business, science and technology, must improve their curricula with the learning of ethics and social values that promote and encourage team-ups among entrepreneurs and within enterprises in order to enhance productivity and sustainability.

    Promoting Entrepreneurial Success stories

    The government and the industrial sector must also team-up to promote the success stories of local entrepreneurs in industry to serve as examples for others. Small and medium scale entrepreneurs who have excelled in their various fields and who have a willing-to-share attitude, should be directly supported with funds to enable them expand and develop better technologies and systems of production.

    Any such entrepreneur that has been supported will then be required to offer training services for other entrepreneurs in a similar venture, thus enhancing total productivity in that industry.  This strategy will also spare the government of any obligation to spread limited funds thinly and inefficiently over too many industries of similar orientation.

    Formulating A Strategic Industrial Policy Focus

    One of the tendencies of export promotion in Ghana is the unrestricted manner in which a wide range of products is exported as “Ghanaian Products”. In many instances however similar products are exported with different levels of quality, with inconsistent measurements, with different prices and/or with unclear labeling, etc.

    The result is that products that are of good quality are “contaminated” with those that have poor quality. Foreign markets are unable to keep track of the quality and price differentials of the same products supposedly coming from the same country.

    This situation eventually erodes confidence in potential foreign markets. One solution to this problem therefore is to support a new generation of entrepreneurs to become more professional in business and encourage them to network among themselves and so ensure mutual compliance to product standards, especially for the export market.

    Pursuing Comparative Advantages

    Another issue within this context is Ghana’s lack of focus on goods and products for which Ghana has comparative advantages. The point must be emphasized that government must pursue a policy of strategic prioritization of selected processed and semi-processed products for which Ghana has comparative advantages.

    This will enable a more focused, specialized and stable position in the global economy and also shape Ghana’s industrial image abroad. This strategic focusing should therefore not be confused with the negative effects of focusing on cocoa, timber and gold. (This is because we hardly add value to these primary export products).

    If we support these strategic products we will get to that point where Ghanaian manufacturers and exporters can oblige foreign markets to scramble for our unique and quality products no matter the price.

    Achieving Self-sufficiency

    The increased globalization of the world economy implies that national economies and industries that rely heavily on foreign markets will be prone to the vicissitudes of those markets.

    On this score it is almost impossible for governments to undertake any successful interventionist program in the short term. However one important strategy is for developing countries to ensure self-sufficiency in their basic food and material needs. Food self-sufficiency is not only necessary for basic human survival and for ensuring savings on scarce foreign exchange, but also, if properly directed it will produce surpluses for food processing and manufacturing industries.

    Conclusion

    The main conclusion from the above discussion is that developing countries like Ghana must take time to assess and optimally utilize their internal human and natural resources as a basis for launching into the global market. This strategy, which has gained currency within development circles is known as “glocalization” – a fusion between global demands and local resource endowments.

    If we as a people do not find our own internally generated ways of getting past international trade barriers, no amount of globalization will change our socio-economic conditions. For indeed, the structural relationship we currently have with our trading partners is one of the major causes of our poverty and indebtedness.

     

  • Gloom as oil price drops; more uncertainty looms-By Emeka Eke Editor-in-chief, GlobalFocus Media

    Gloom as oil price drops; more uncertainty looms-By Emeka Eke Editor-in-chief, GlobalFocus Media

    Crude Oil future continues to fluctuate even as President Donald Trump looks set to impose higher levies on two of the United States’ biggest suppliers; Canada and Mexico!

    With China gearing up for countermeasures if the United States implements its planned threat to increase tariffs on Chinese imports, the battle for superiority and dominance is only just getting started!

    As the US relies majorly on oil imports from Canada and Mexico for its refineries, the potential tariffs may have a complex effect on crude prices which by extension, may affect some oil-dependent economies including in Africa.

    Attempts to broker an end to the Russia-Ukraine war added a different twist to the market last Friday, after Trump’s highly anticipated meeting with Ukrainian President Volodymyr Zelenskiy ended with a tense exchange! The two leaders failed to sign a deal that was set to make the US a major partner in extracting Ukraine’s oil and gas, as well as rare earth minerals.

  • Trump’s ‘electroshock’ on Ukraine ends the debate: Europe cannot rely on the US for its security-By Browen Maddox

    Trump’s ‘electroshock’ on Ukraine ends the debate: Europe cannot rely on the US for its security-By Browen Maddox

    Independent Thinking Expert comment   Published 14 February 2025

    Director and Chief Executive,Chatam House

    The Munich Security Conference begins today with European leaders in a state of shock, following the news that President Donald Trump has spoken directly to Russian President Vladimir Putin in a 90-minute phone call. Trump evidently did so without consulting Ukraine or NATO allies.

    He announced the call after the fact, along with the news that direct negotiations to end the war in Ukraine would begin ‘immediately’. He proposed a summit in the near future in Riyadh, Saudi Arabia.

    With his actions the president has unilaterally lifted Putin’s diplomatic isolation and provoked astounded reactions across Europe. When the initial shock subsides, the significance of the change in US policy that this represents will sink in. The conference has much to consider – but at least certain truths are now painfully clear.

    Walking back

    Trump’s credentials as a dealmaker are now unquestionably damaged. This week, before any negotiations have commenced, his administration has publicly vowed that Ukraine will not be part of NATO, implied that Russia could keep territory it has taken in its war, and firmly stated that no American troops will defend Ukraine.

    Boris Pistorius, Germany’s defence minister, was the first to make the point that there is no art in any deal that makes the most important concessions before negotiations even begin. Among other defence ministers and intelligence chiefs gathering for the conference, ‘appeasement’ is the term being exchanged, in deliberate recognition of its historical resonance here in Munich.

    Yet even that fails to capture the full significance of President Trump’s actions. Trump has made clear that friends and allies count for nothing. He has fundamentally undermined European confidence in US commitment to NATO and the principle of mutual defence – the underpinning of peace and security in Europe for over 75 years.

    And he has jettisoned the notion that the US should try to set the principles by which the world is ordered. President Trump has made clear that the pursuit of what he sees as immediate US interest is more than a campaign slogan, it is his resolved policy.

    As was the case following Trump’s Gaza proposals, US officials attempted to walk back or reframe certain elements of the president’s language: the US might still help contribute to a security guarantee for Ukraine, it was stated. Europe’s leaders will be far from convinced. The damage has been done. Even after the president leaves office it could take years, even decades to repair.

    Europe’s response

    EU countries and the UK now have immediate, difficult decisions to make: how to support Ukraine; how to defend the European continent; and what form US relations should now take.

    On Ukraine, European countries have a few cards to play. They hold most of the frozen Russian assets which presumably will form part of a negotiation with Putin. They have also been a prime customer for Russian gas. Even if the pressure to buy this cheap energy again is rising (it is an audible issue in the German election campaign), it remains a bargaining point.

    the us has made clear that it does not intend to help defend a line of cessation of fighting between Ukraine and Russia.

    But any durable peace requires a convincing security guarantee for Ukraine. That is now imperilled. Besides ruling out NATO membership, the US has made clear that it does not intend to help defend a line of cessation of fighting between Ukraine and Russia, stating that any such defence will have to come from European countries.

    In practice, that is likely to mean a military presence deployed by the UK, France and Poland. But any useful commitment would absorb almost all of the UK’s diminished armed forces. And it is hard to see how any purely European defence of Ukraine could be effective without support from US airpower and missile technology. (The Trump team has hinted this might be available).

    SOURCE

    CHATAM HOUSE NEWSLETTER

  • Africa: The Sahel Can Revolutionize Renewable Energy Access and Affordability Up to the Last Mile (By Reshmi Theckethil)

    Africa: The Sahel Can Revolutionize Renewable Energy Access and Affordability Up to the Last Mile (By Reshmi Theckethil)

    DAKAR, Senegal, January 31, 2025/ — By Reshmi Theckethil, Lead Portfolio, Climate Action, Disaster Risk Reduction, Energy, and Resilience | Sahel Resilience Project Manager, UNDP Sub-Regional Hub for West and Central Africa (www.UNDP.org). 

    Imagine a Sahel region where every household, school, and hospital has access to clean, affordable energy—where renewable power not only serves homes but also drives economic transformation. Given the region’s rich solar, wind, and hydro resources, this vision is achievable. With one of the highest potential for solar energy production globally, at 13.9 billion kWh/year compared to the global consumption of 20 billion kWh/year, the Sahel’s renewable energy capacity remains underutilised. Currently, over 55% of energy production is dominated by fossil fuels like oil and gas, while renewable sources remain marginal.

    Over the last two decades, primary energy demand in almost half of the Sahel countries has grown by more than 4% annually [1]. However, urban areas benefit disproportionately, leaving nearly half the population without electricity. Connectivity disparities are exacerbated by the high costs of power generation and infrastructure, with reliable electricity reaching only about 20% of the population.

    Renewable Energy: A Driver of Human Development  

    Renewable energy in the Sahel is more than a technical solution—it’s a catalyst for sustainable human development. Policies that localise green energy solutions can end energy poverty and foster resilience. The transition from fossil fuels to renewables, as outlined in Nationally Determined Contributions (NDCs), offers inclusive opportunities for growth, improved social outcomes, and environmental protection. Coordinated strategies can ensure climate resilience while prioritising human welfare outcomes.

    For women and youth, renewable energy access is transformative. It reduces reliance on time-intensive manual labour, opening opportunities for innovation and increased productivity across sectors. Solar-powered agricultural hubs could allow farmers to process produce locally, boosting incomes and reducing waste. Solar-powered irrigation could regenerate arid lands, combat food insecurity, and create sustainable livelihoods.

    International Commitment to the Sahel  

    Cognizant of the region’s potential, UNDP is implementing the United Nations Integrated Strategy for the Sahel (UNISS), aiming to provide clean, affordable energy to over 150 million people by 2025. Since 2021, renewable energy initiatives have benefitted more than 70.7 million people in areas like the Lake Chad Basin [2] and Liptako-Gourma [3].

    These efforts, supported by partners such as Sweden, Germany, the Netherlands, the United Kingdom, the African Development Bank, Norway, Japan, and local actors, leverage the productive use of energy to address structural energy poverty with climate and security considerations.

    Initiatives like the Africa Minigrids Programme, the Regional Stabilization Facility, the Sahel Resilience Project and the Energy4Sahel initiative remain crucial to the region as they strengthen local regulatory capacities and empower communities to develop scalable, innovative solutions. For example, in Mauritania, Aziza Sidi Bouna, Founder and CEO of SB-GAZ, designs biodigester prototypes that supply homes with clean energy at a fraction of the cost of propane gas traditionally used for cooking. In Gambia, Jankey Jassey, a young renewable energy engineer, is at the forefront of creating space for young girls to work in the renewable energy sector.

    In Guinea, a young researcher, Marc Tambo, took on the bold task of mobilising his community to build a micro-plant that could power an electric plant, creating energy access for many and job opportunities for the community.

    Strengthening Regional Collaboration  

    As the world shifts towards clean and equitable energy transitions, the region can spearhead sustainable and human-centred African green innovation. By working with development partners, the private sector, and the diaspora, Sahelian countries can adopt targeted green industrial policies to ensure and expedite necessary technology transfers and access to financing, as well as affordability and efficiency improvements.

    To create long-term solutions devoid of temporary market distortion, incentives for commercial investments must be considered. These investments must result in lasting customer-centric solutions that model cost-effective electrification scenarios and innovations aligned to socioeconomic development metrics.

    Capitalising on the African Continental Free Trade Area (AfCFTA) opportunities, these nations can widen market access and promote cross-border energy interconnectivity and regional power pools. However, bridging the gap between ambitious policies and ground-level implementation sustained political commitment and strategic investments. Governments must ensure ministries and agencies prioritise energy access policies, with transparent public dashboards tracking progress.

    Civil society involvement in oversight and expenditure analysis is critical to achieving national electrification targets.

    Through partnerships, innovative incentives, and public-focused investments, the Sahel can close the energy gap and bridge the rural-urban divide.

    Renewable energy offers a transformative path to sustainable, inclusive development. By fostering innovation and effectively leveraging resources, the Sahel can become a model for climate resilience and economic revitalisation, achieving energy access and affordability up to the last mile.


    [1] International Energy Agency (2022). Clean Energy Transitions in the Sahel. International Energy Agency. Paris.

    [2] Cameroon, Chad, Niger and Nigeria

    [2] A historically marginalised area at the intersection of Burkina Faso, Mali, and Niger
    Distributed by APO Group on behalf of United Nations Development Programme (UNDP).

    SOURCE
    United Nations Development Programme (UNDP)

  • Solutions for Igniting Africa’s Digital Revolution – Insights from “Unstoppable Africa”

    Africa is steadily progressing in its digital transformation, drawing on the continent’s resources, creativity, and youthful demographic to drive change—yet there remains significant ground to cover. As the digital era continues to accelerate, we must seize this opportunity to position Africa as a key player on the global stage. If we fail to act decisively and work together, we risk being sidelined in the global digital landscape.

    At the recent “Unstoppable Africa” event hosted by the Global Africa Business Initiative in New York on the sidelines of the UN General Assembly High-Level week, I led a panel discussion titled ‘The Panel of the Future: Solutions for Igniting Africa’s Digital Revolution.’

    During the panel discussions, esteemed speakers — including H.E. Paula Ingabire, Minister of ICT & Innovation for Rwanda; Mr. Peter Ndegwa, CEO of Safaricom; Ms. Doreen Bogdan-Martin, Secretary-General of the International Telecommunications Union (ITU); and Mr. Cheick Camara, Vice President & Managing Director of ServiceNow Africa — each brought a unique perspective on how Africa can leverage its strengths to build a robust digital economy.

    H.E. Paula Ingabire highlighted Rwanda’s proactive approach to emerging technologies, positioning the country as a proof-of-concept hub for innovative companies and start-ups to launch, test and scale.

    Mr. Peter Ndegwa stressed that connectivity must be a fundamental right across the continent, with Safaricom already scaling up its assembly of affordable smartphones, while Ms. Doreen Bogdan-Martin was optimistic about Africa achieving significant digital transformation by 2030. Mr. Cheick Camara reminded us that it is essential for Africa to create and contribute to AI models. In addition, AI alone will add $16 trillion to the global economy by 2030, a wave that Africa must not miss.

    The reality is that African nations are at a critical turning point, confronted with the risk of being sidelined in the global digital race. As countries worldwide rapidly embrace technological advancements, particularly in fields such as artificial intelligence (AI), machine learning, and data analytics, the continent must act swiftly to avoid being marginalized.

    The pace of innovation and technological advancement is incredible. Daily, new developments take place, reshaping industries and redefining how we live and work. Since we last gathered at Unstoppable Africa, the technological landscape has evolved rapidly, highlighting the critical need for African nations to keep pace with global trends.

    One of Africa’s most significant advantages is its youthful population. With over 60% of Africans under 25, we are blessed with a demographic comfortable with technology and eager to experiment – qualities that are vital for driving technological advancement.

    Alongside our youthful population, Africa boasts a wide variety of cultures. The panel discussion emphasized that promoting a culture of creativity is essential for achieving sustainable growth. This means creating an environment where new ideas can flourish, and failure is seen as a steppingstone to success rather than a setback.

    To capitalize on these strengths, however, African nations must prioritize investments in education and technology infrastructure. An educational system that includes digital literacy, critical thinking, and project management skills is essential to preparing the workforce for the digital economy.

    Beyond driving digital success, project management empowers Africa’s young leaders with the frameworks and skills needed to address complex challenges in an ever-evolving digital landscape, building a future-ready workforce that can take African innovations to scale.

    Furthermore, enhancing technology infrastructure—such as improving internet access and digital services—will empower citizens to participate actively in the digital economy. This is consistent with the four key pillars of Africa’s digital revolution namely: Digital Infrastructure and affordable devices, Internet access and cost, Digital skills and education, and Digital Innovation.

    By empowering citizens with knowledge and access to technology, African nations can cultivate a skilled workforce capable of leading innovation in various sectors, from agriculture, where digital tools can boost productivity and sustainability, to healthcare, where telemedicine and AI-driven diagnostics offer new solutions for widespread challenges. Fintech and renewable energy also represent high-impact areas where African innovations are already showing potential to lead globally.

    Additionally, the insights shared by our panelists highlighted the importance of collaboration among various stakeholders—governments, businesses, civil society, and international partners.  This collaborative approach is essential for building an ecosystem where digital technologies can thrive, enabling Africa to contribute meaningfully to global advancements and ensuring that the continent leads in certain areas of the digital revolution.

    Government policies can provide the regulatory frameworks and infrastructure needed for digital growth, while businesses bring in expertise, resources, and technology to accelerate technological advancement. Project management is essential in transforming these ideas into reality. By leveraging project management principles, countries and companies on the continent can strategically allocate resources, streamline efforts, and scale innovations across multiple sectors.

    Beyond driving digital success, the discipline empowers Africa’s young leaders with the frameworks and skills to address complex challenges in an ever-evolving digital landscape, building a future-ready workforce. Civil society offers critical perspectives on inclusivity and the ethical use of technology, while international partners bring valuable experience and investment to support Africa’s digital journey.

    This collaborative approach empowers Africa to move beyond simply “catching up” with the rest of the world; it positions the continent to lead in key areas of the digital revolution, from fintech and digital agriculture to health tech and renewable energy. By leading in such sectors, the continent can redefine its role in the digital age, showcasing the transformative potential within its borders.

    Now is the time to join forces and drive a digital revolution that secures a prosperous and inclusive future for the continent and generations to come!

  • Brics+ countries are determined to trade in their own currencies – but can it work?

    Brics+ countries are determined to trade in their own currencies – but can it work?

    By:Academic Journalist,

    Associate Professor, China Studies Centre, University of Sydney

    The Conversation ,First Published,26th November,2024

    Photo(Brics Summit 2024)

    Brics+ countries are exploring how they can foster greater use of local currencies in their trade, instead of relying on a handful of major currencies, primarily the US dollar and the euro.

    The forum for cooperation among nine leading emerging economies – Brazil, China, Egypt, Ethiopia, India, Iran, Russian Federation, South Africa, United Arab Emirates – emphasised this determination at their 16th summit in October 2024.

    Economist Lauren Johnston recently wrote a paper on this development. The Conversation Africa asked her for her insights.

    Why do Brics+ countries want to trade in local currencies?

    There are economic and political reasons to use local currencies.

    Using local currencies to trade among themselves will lower the transaction costs and reduce these countries’ dependence on foreign currencies.

    Over the past few centuries, the world’s economy has developed in a way that makes certain currencies more valuable and widely trusted for international trade. These include the US dollar, the euro, the Japanese yen and the British pound. These currencies hold value around the world because they come from countries with strong economies and a long history of trading globally.


    When people or countries trade using these currencies and end up collecting or holding them, they consider it “safe” because the value of these currencies remains stable and they can be easily used or exchanged anywhere in the world.

    But for countries in the global south, like Ethiopia, whose currency (the birr) isn’t widely accepted outside its borders, trading is far more difficult. Yet these countries struggle to earn enough of the major currencies through exports to buy what they need on international markets and to repay their debts (which tend to be in those currencies). In turn, the necessity of trading in major currencies, or the inability to trade in them, can create challenges that slow down economic growth and development.

    Therefore, even some trade in local currencies between Brics+ members will support growth and development.

    Oil exporter Russia is a unique case. Though there are fewer foreign currency constraints overall, Russia faces extensive financial sanctions for its war of aggression against Ukraine. Using a variety of currencies in its foreign transactions may make it easier to get around these sanctions.

    Politically, the reasons for using other currencies primarily relates to freedom from sanctions.

    One of the tools for making sanctions work is an international payments systems known as Swift (Society for Worldwide Interbank Financial Telecommunication). Swift was founded in 1973 and is based in Belgium. It enables secure and standardised communication between financial institutions for international payments and transactions. And it’s almost the only way to do this.

    It was first used to impose financial sanctions on Iran in 2012, and has since been used to impose sanctions on Russia and North Korea.

    If a country is cut off from Swift, it faces disruptions in international trade and financial transactions, as banks struggle to process payments. This can lead to economic isolation and challenges in accessing global markets.

    The reality, and possibility, of exclusion from Swift’s payments system is one of the factors galvanising momentum towards a new payments system that also relies less on the currencies of the countries that govern Swift – like the euro, Japanese yen, British pound and US dollar.

    What are the likely challenges they will face?

    The Brics+ plan to use local currencies faces some hurdles.

    The central problem is the lack of demand for most currencies internationally. And it’s hard to supplant the international role of existing major currencies.

    If, for example, India accumulates Ethiopian birr, it can mainly only use them in trade with Ethiopia, and nowhere else. Or, if Russia allows India to buy oil in rupees, what will it do with those rupees?

    Since most countries seeking alternatives to dollar dependence tend to sell more than they buy from other countries, or are lower-income importers, they must consider what currencies to accumulate via trade.

    When it comes to payment systems, at least, alternatives are emerging.

    Brics+ is creating its own, Brics+ Clear. Some 160 countries have signed up to using the system. China also has its own, Cross-border Inter-bank Payment System, which broadly works the same way as Swift.

    There’s a risk, though, that these payment methods could merely fragment the system and make it even more costly and less efficient.

    Has trading in local currencies been done elsewhere?

    Not all trade is done in major western currencies.

    For example, in southern Africa, within the Southern African Customs Union, the South African rand plays a relatively important role in cross-border trade and finance. Just as in south-east Asia the currencies of Singapore and Thailand compete to be the dominant currency in the sub-region.

    China – the world’s biggest exporter and producer of industrialised goods – is also signing bilateral currency swap agreements with countries. The goal is greater use of the renminbi in the world.

    As a means of circumventing sanctions, India and Russia recently trialled using the rupee to trade. Russia’s oil exports to and through India have risen strongly since the Ukraine war and some 90% of that bilateral trade takes place in the rupee and rouble. This leaves Russia with a challenge – what to do with all the rupees it has accumulated. These deposits are sitting in Indian banks and being invested in local shares and other assets.

    Another example of efforts to side-step major international currencies is China’s model of “barter trade”. The model works like this: China exports, for instance, agricultural machinery to an African country and receives payment in that country’s currency. China then uses that currency to buy goods from the same country, which are then imported back to China. After these goods are sold in China, the Chinese trader is paid in renminbi.

    Ghana is one country involved in this barter model. Challenges facing the model include the digitisation of payments and trade, and trust – high levels are needed to establish and maintain relationships between trading parties as individuals and as businesses. It also requires some level of centralisation and coordination, but lacks strong laws, regulations and industry standards. This means that different platforms and enterprises may not be compatible, which can add to transaction time and costs.

    Another example is when Chinese investors in Ethiopia make profits in birr. They use these birr to buy Ethiopian goods, like coffee, and export the goods to China. In China, when they sell these goods, they receive renminbi. So they transfer their profits from Ethiopia to China by increasing Ethiopia’s exports to China.

    Anecdotal reports suggest this is feasible at a small scale but has relatively high coordination costs.

    There could be other challenges. For example, if Chinese buyers pay Ethiopian coffee farmers in their local currency, instead of US dollars, it could lead to fewer dollars being available overall. Some international transactions still rely heavily on dollars.

    How should Brics+ nations structure their arrangement?

    There is no simple, or easily scalable, solution to moving past the reliance on major international currencies or circumventing Swift.

    A fast, digital payment system is needed. This system would calculate and balance currency demand efficiently. It must also be reliable, replace parts of the current system, and not create extra costs for countries that aren’t using it yet.

    Although some Brics+ members, like Russia, may have more interest in fast-tracking change, this may be less in the interest of other Brics+ members. A move away from Swift, for instance, requires buy-in from local financial institutions, and those in African countries may not be under pressure to shift to a new lesser-known platform.

    Given these challenges, I argue that Brics+ should progress incrementally. What can happen soon, though, is to conduct some trade in local currency.

    SOURCE

    THE CONVERSATION

  • Editor’s Pick

    At this most crucial moment in Ghana’s development history, it is disheartening to hear of incidents like the recent Zogbie one that has led to the loss of precious lives.

    The various ethnic groups in the Northern region should consider the fact that, they are never real enemies against each other but rather, poverty, squalor and under development is their real common enemy they need to confront together in their own interest.

    We of the Economic and Environmental News Africa magazine, therefore wish to implore the youth in the northern region in particular to rather give priority to using their youthful exuberance in promoting and building peaceful co-existence and harmony between the various ethnic groups for  their collective well-being.

    We implore Dagomba and Konkomba youth to rather strive towards being agents of change and sustainable development not agents of needless acrimony,hatred and war.

    Dagomba and Konkombas are age-long historical neighbours and relations were based on mutual respect,paceful co-existence which also resulted into  intermarriages.The mother of the late Ya Naa Yakubu i(1799–1839) whose two sons,Na Abudu and Na Andani founded the current Abudu and Andani royal gates,elders say was a konkomba.  Thus,the age-long accolade of honour, bestowed on Konkombas in Dagbon traditional governance circles as ,”Na Mayili Nima” transalated,the King’s mother’s people.

    Not only Dagombas alone resist German Colonial rule that reached its crescendo at the famous battle of Adiboo,but some Konkombas communities  too were repotted to have did same in their perhaps taking a cue from their historical neigbours,the Dagombas.

    The Eco-Enviro News Africa magazine focused on the progress and sustainable development of Africa and humanity at large,wish to implore Dagomba and Konkomba youth to rather focus on  Issues of the region’s development challenges including climate change impact on agriculture, biodiversity loss. the idea of Dagombas are enemies to Konkombas is an aberration  and has no anthropological basis.

    Dagombas and Konkombas ought to Leverage each others core competencies of each other draw upon their collective strength so as to enable them make more meaningful contribution towards various central government’s efforts aimed at uplifting their socio-economic lives that would also  narrow  down and eventually close  the age-long colonial legacy,the North-South development gap.

    The North’s Share of FDI

    Due to the relatively higher  infrastructure  the southern part of the country enjoys over the North, a greater chunk of Foreign Direct Investment(FDI) remain in the south  while a negligible amount goes up North. Series of Periodic ethnic conflicts like the recent one under discussion,cumulatively given the  Northern sector a bad name in both local and international investor circles.

    The North’s Unique Selling Points

    The five Northern regions of the country put together are blessed with an enormous primary agriculture and agribusiness,tourism,mineral deposits potential   potential that could be harnessed not only for improving the socio-economic lives of their people, but to the benefit of the country’s gross national economy.

    A national agriculture policy framework that could target the five northern regions leveraging both rain-fed and irrigation fed farming in the regions, could effectively help in addressing Ghana’s disturbing annual multi-billion rice and general agricultural products import bill.

    No wonder the African Development Bank’s President Adesina during an official visit to Ghana in 2017, had cause to candidly state that, with the northern sector’s arable land potential of 7 million hectares suitable for rice cultivation, Ghana has no business importing rice.

    Down the Memory Lane   

    In the early to mid-seventies, these regions collectively were said to have been contributing to over seventy percent of Ghana’s agriculture GDP. Thus, it was bestowed the accolade, the ‘Granary of the nation”.

    Indeed, they together, constituted the heartbeat of the late General Acheampong-led Supreme Military Council’s Green Revolution that was at the time known as, “Operation Feed Your Self’(OFY) with the catch phrase,” O biara ndo” in local Twi, translated as, “All must farm”

    Agricultural production and productivity was at its zenith under the programme to the extent that, Ghana attained food self-sufficiency and exported her surplus rice and maize to other African countries.

    Dagombas and Konkombas   must learn to at all times adopt dialogue in the resolution of their differences human that they are, and not through  physical confrontation.

  • How Would a New BRICS Currency Affect the US Dollar? (Updated 2024)

    How Would a New BRICS Currency Affect the US Dollar? (Updated 2024)

    By:,First Published,July 8,2024

    The BRICS nations are interested in creating a new currency to compete with the US dollar, and recently announced plans for a blockchain-based payment system. Learn about the developments thus far and how investors can prepare for the possibility.

    The BRICS nations, originally composed of Brazil, Russia, India, China and South Africa, are looking to establish a new reserve currency backed by a basket of their respective currencies.

    The potential BRICS currency would allow these nations to assert their economic independence while competing with the existing international financial system. The current system is dominated by the US dollar, which accounts for about 90 percent of all currency trading. Until recently, nearly 100 percent of oil trading was conducted in US dollars; however, in 2023 one-fifth of oil trades were reportedly made using non-US dollar currencies.

    Central to this ongoing situation is the US trade war with China, as well as US sanctions on China and Russia. Should the BRICS nations establish a new reserve currency, it would likely significantly impact the US dollar, potentially leading to a decline in demand, or what’s known as de-dollarization. In turn, this would have implications for the United States and global economies.

    It’s still too early to predict when a BRICS currency will be released, but it’s a good time to look at the potential for a BRICS currency and its possible implications for investors.

    Why do the BRICS nations want to create a new currency?

    The BRICS nations have a slew of reasons for wanting to set up a new currency. Recent global financial challenges and aggressive US foreign policies have prompted the BRICS countries to explore the possibility. They want to better serve their own economic interests while reducing global dependence on the US dollar and the euro.

    When will a BRICS currency be released? There’s no definitive launch date as of yet, but the countries’ leaders have discussed the possibility at length. During the 14th BRICS Summit, held in mid-2022, Russian President Vladimir Putin said the BRICS countries plan to issue a “new global reserve currency,” and are ready to work openly with all fair trade partners.

  • Africa- Policy Reform and Revitalization: The Key to Expanding South Africa’s Natural Gas Infrastructure (By NJ Ayuk)

    Africa- Policy Reform and Revitalization: The Key to Expanding South Africa’s Natural Gas Infrastructure (By NJ Ayuk)

    South Africa is in many ways one of the most modern countries in Africa, particularly with respect to electricity access. Yet while its numbers compare favorably with most other African nations (as of 2021, 89.3% of the population had reliable access to electricity, making it the fifth-highest ranking in the continent according to the World Bank), it still shares some of the same core problems as the others: an unreliable energy supply facing a rapidly growing population, an expanding economy, and increasing urbanization.

    With climate change looming large over any debate about energy, the pressure is on from more economically developed nations for Africa to bypass older energy technologies and jump straight to renewables. As wonderful as that may sound in theory, the key to supplying a growing nation is stability, and the key to stability is diversity.

    For South Africa, whose current power generation structure is dominated by coal, that means including natural gas — which Africa has in almost as much abundance as sun and wind — to help steady the supply of energy while renewable technology continues to mature.

    Diversifying the energy supply is not as simple as opening the door and putting out the welcome mat, however. For energy suppliers to thrive in a new market, they need to see stability as well — stability of policy and infrastructure. Companies don’t like doing business where the rules are Byzantine, and their physical needs are difficult or impossible to supply.

    To support the expansion of its natural gas infrastructure and ensure a more prosperous future, there are several policy initiatives that South Africa should embrace.

    Physical Needs

    The most obvious place to start is expanding the existing gas networks to support wider distribution.

    Current supply is highly localized in just three areas around Gauteng, Mpumalanga, and KwaZulu-Natal. Adequate storage facilities are sorely lacking outside of these zones and need to be built before pipeline networks can be installed to distribute the gas.

    Plans are currently underway to develop such facilities in Coega, Richards Bay, Saldanha Bay, and just across the border in Maputo, Mozambique. This is a good start, but more will be needed to facilitate prompt additional power generation when a renewables-based grid needs assistance. Terminals and regasification plants for liquefied natural gas (LNG) would also enhance the country’s import capacity.
    Public-private partnerships with corporations such as ExxonMobil and Royal Vopak, along with international collaborations among governments, could help accelerate these developments.

    South Africa also needs to do more to access and utilize its own native supply of natural gas in areas like Mossel Bay, the Orange River Basin, and the shale formations of the Karoo Basin. Seismic surveys and exploratory drilling are needed to more accurately characterize the resources available and optimize the location of gas processing and transport infrastructure. Energy independence is an important factor in long-term stability, as evidenced in Europe when Russian gas imports were abruptly cut off.

    The country could also benefit from converting old, mothballed coal-fired power plants to use natural gas instead. This could save time and money by requiring fewer new builds, and also recover jobs that were lost when these facilities were decommissioned. Although some coal plants can be converted to diesel, LNG is a more environmentally friendly option that more efficiently supports combined-cycle and open-cycle gas turbine plants.

    Policy Needs

    As is so often the case, much of what stands in the way of progress comes down to policy and paperwork. It’s all well and good to say we need more exploration, but unclear permitting and consulting processes, lengthy appeals timelines that exceed regulatory allowances, and limited permit validity periods for reconnaissance activities are highly discouraging to potential investors and developers, who need assurance that they aren’t throwing their time and money into a bottomless pit.

    Instead, development partners need clear, stable, and supportive regulations to ensure legal certainty for projects. Policy implementation and permitting must be transparent and provide a clear framework for discussion and decision-making when considering risks, mitigations, and economic development goals.

    A policy brief published by Eye for Business and commissioned by The EnerGeo Alliance in May 2024 offered a number of suggested policy reforms aimed at streamlining energy development in South Africa. The EnerGeo Alliance is a global trade alliance for the energy geoscience industry, representing geoscience companies, innovators, and energy developers. Steps recommended by the brief include well-thought-out reforms that could quickly spur much-needed investment in the country:

    • Implementing clear and stable policies that support the development and integration of natural gas within the energy sector.
    • Addressing policy gaps regarding new gas sources and creating incentives for investment in gas infrastructure.
    • Streamlining geoscience survey permitting and consultation processes to provide critical data for identifying and developing domestic natural gas resources.
    • Providing certainty for project proponents who have received relevant exploration rights and environmental authorizations.
    • Considering standardized and coordinated assessment of environmental impacts and consultations to provide greater confidence for all stakeholders and reduce redundant assessments and consultations.
    • Initiating regular licensing rounds for offshore exploration activities to provide opportunities for investment and enhance competition.
    • Extending the validity of reconnaissance rights to offer project proponents more flexibility in seismic data acquisition, even when weather and environmental sensitivities cause slowdowns.
    • Prioritizing the construction of LNG terminals and other necessary infrastructure to support natural gas import, storage, and transportation.
    • Establishing a clear timeline detailing how natural gas can add value in the immediate future, well before renewables become available.
    • Establishing stringent safety standards and regular maintenance schedules for gas infrastructure to mitigate risks and ensure long-term operational integrity.

    To expand on that last item, while it is important for economic development to provide a supportive environment for investors, any wise society must also take steps to protect itself from being taken advantage of due to lax or nonexistent regulation that can result in compromises to oil and gas infrastructure. A stable supply of energy can only occur when safety and security regulations are respected and consistently enforced.

    With national energy demand expected to triple by 2040, South Africa must plan wisely to expand and stabilize its energy supply, both imported and domestic, while respecting well-founded concerns about future climate change. Natural gas is the most reliable, efficient, abundant, and lowest-carbon fuel available to bridge the gap to a fully renewable future. If we are to utilize it responsibly, we must first provide a sound, sensible, and transparent policy foundation to smooth the road for all who wish to see South Africa prosper in the decades to come.

    Distributed by APO Group on behalf of African Energy Chamber.

    SOURCE
    African Energy Chamber