In praise of the resourceful Nigerian

dev1.jpg

Nigerians are go getters…you just have to admire their fighting spirit. While there are many Nigerian conmen out there (who over the decades have tarnished the reputation of Africa, and Africans), there are many more honest and hardworking Nigerians doing some very interesting things – involved in some innovative businesses, so it’s no overstatement to say we can all learn from their ingenuity http://www.nairaland.com/2512295/top-14-nigerian-innovators-watch

Malawian entrepreneurs in contrast appear to be different. While this is a generalisation, some Malawian business people will see the purchase of a private jet or building of a hotel, and think that such is a sign of development or wealth…??

Instead of buying a private jet (in a very poor country) or building a shopping mall, Malawian ‘entrepreneurs’ who have significant capital resources should consider investing their money into something transformative that has a potential to create a massive industry, one that will improve the lives of large numbers of people, especially since Malawi is a country that needs to let go of it’s over-dependence on Tobacco. And this is not about social enterprises as you’ll see below.

To give an example, the Indians invested into call centres after China took over their manufacturing edge, and recently there has been an increase of so many Indian companies getting into industries like the provision of SEO services (they control 6.6% of the global market https://moz.com/industry-survey), building Apps and other businesses which are not only scalable, but have the potential to employ hundreds of thousands of people. That’s even before you mention Automotive (On top of Tata Motors, they also own Jaguar), … But back to Malawi for a moment; we cannot be building shopping Malls, Golf courses or Hotels and claim that such is a sign of development? Building Shopping Malls or Hotels only encourages consumerism, spending… spending… spending… it doesn’t increase the net worth of the majority of people, it doesn’t in itself help improve the lives of those who buy from those malls, and generate incomes for them. A shopping Mall will not increase your earning potential, and only benefits the few families who have the capital to set up shop in them, including those investors who own the Mall.

I would rather Malawians build institutions that provide skills to our people to enable them to be qualified so that they can work in sectors that manufacture goods and compete with the likes of Kenya, Vietnam, Malaysia and Brazil.

All well and good talking about wanting Africa to make stuff, to make motorcycles, cars, aeroplanes, refridgerators and whatever else… but are the people who will make those things sufficiently qualified?

Most people like to give an example of China, South Korea, or Singapore as examples which Africans should emulate, but what they forget to mention is that in these societies, a greater proportion of the workforce is extremely highly qualified (not in terms of just having PhD’s, but they have transferable technical skills: They understand Physics, Electronics and Engineering principles and Manufacturing processes, and can use such skills and knowledge to apply to problems with the hope of finding a solution. If a solution is found, they can come up with a product that embodies that solution). In addition many innovators fromthese countries are trained in business, unlike the situation in our African countries where too many people who run businesses don’t even follow the fundamental concepts essential for a successful business.
What Malawi should be striving for, is to equip it’s young people with skills so that they can become resourceful and attempt to solve the problems within their communities/ global challenges, and in the process increasing their earning potential.
Let me proivide another example. If a Malawian national had invented a device similar to this ocean cleaning bin http://www.boredpanda.com/floating-rubbish-bin-ocean-clean…/ it is possible with visionary leadership, a good strategy and the right kind of funding to create a factory that would employ 3000 – 4000 people in Malawi over 5+ years, making these devices within Malawi, and selling them all over the world. The invention would make huge profits for the owner of that company…. in any case, this is only a simple device, and there’s nothing too complicated about it. In my view it can even be made from dry reeds weaved in the same way as weaved baskets, so no excuse for the unavailability of raw materials:

reed-basket
In case you are asking why such a business would work, it has to be because sea / ocean debris is a real concern all over the world, and there is a huge demand (a market, which is an essential component for a product based business) for a simple device that can be made cheaply and deployed to clean oceans and lakes of all the plastic and other waste that’s thrown into them(waste that endangers marine life).
In contrast, even if a Shopping Mall or Hotel creates jobs for 200 – 300 people, comparatively it’s far less than what a factory making goods that can be exported globally has the potential to employ. Further, the money that shopping mall makes for the owner would be miniscule compared to the profits that would be generated by a product that is a commercial success globally.

Young Tanzanian switching on rural areas with solar energy

 George Mtemahanji - Copyright: http://www.modenatoday.it
George Mtemahanji – Copyright: http://www.modenatoday.it

“In Africa it is difficult because when I start talking with people about our company and solar solutions, they often look at us like we can’t be taken seriously just because we are young,” he explained.

“It is really stressful for young people to build businesses on the continent because there are many stereotypes about us.”

His advice to other young entrepreneurs facing similar challenges is not to let it prevent them from getting up every day and trying their best to achieve their dreams.

“If we do not believe in ourselves, no one can believe in us. So we must have self-confidence.”

Young Tanzanian switching on rural areas with solar energy

Selling Malawi for Peanuts

In whatever we do as a country, we need to make sure that the development path we take should be sustainable for the inter-generational cause. Our generation inherited a beautiful country and as the current custodians of this land, it is our duty to safeguard the interests of current and future generations of native Malawians.

It is my belief that those who fought to extricate colonialism were driven with the fervent desire to see this country independent of foreign dominion that was British Imperialism. It is therefore our duty to honour the wishes of those who fought and died for our Malawi by making sure that native Malawians are the drivers of development in Malawi.

David Korten, one of the leading proponents of alternative development once wrote,

The survival of our civilization, and perhaps our very lives, depends on committing ourselves to an alternative development practice guided by the three basic principles of authentic development: justice, sustainability and inclusiveness-each of which is routinely and systematically violated by current practice‘.

Today, Malawi is slowly creating an economy which will become dependent on some foreigners who are only here on temporal basis to make a fortune. Native Malawians are slowly being excluded from many vast opportunities that this nation has to offer, and I believe that the development course taken today by us, will harm the interests of our children and future generations because of our shortsightedness.

The biggest issue that is worrisome in this country is the sale of lucrative land to foreigners. According to Watipaso Mzungu’s report in the Nation newspaper of 17th January, only 5 native Malawians own business land in Limbe. It is a sad development on our part because just about 3 decades ago, native Malawians owned lucrative land especially in the cities of Malawi.  At the rate we are going, native Malawians will end up being excluded in their own country because we only want to satisfy our current intra-generational needs. I am not saying that it is wrong for foreigners to invest in Malawi, but we need to exercise caution when prime land is being sold to foreigners without securing the interests of native Malawians. A good example is that of the conflict between the locals of Masasa in Mangochi and Mota Engil. The locals claim they were not consulted about the selling of their land by the government to Mota Engil. The traditional authority tried to coax the locals to give up their land to Mota Engil, a transnational corporation which has plans to build a 5 star hotel and golf course by the lake in Mangochi. In the end, the irate locals of Masasa fought with the T/A, councillor and the police which left 2 people dead and others seriously injured. These are the situations which are unsustainable for Malawi because we are ready to deprive our own people their lake which ancestors lived with for many generations. The 5 star hotel and golf course is a welcome investment but it should not be to the detriment of the locals at Masasa. I am sure the lake has many vacant tracts of land where this 5 star hotel can be built without displacing people. Development is about including a people’s livelihoods in projects which ensure that poor local communities are not excluded from benefitting from our natural resources.

Another worrying aspect of this land issue is that there are some unscrupulous chiefs who sell large tracts of valuable customary land to foreigners without securing the interests of future generations in their communities. Malawi has one of the most beautiful natural beaches in the world and there is need for us to limit and protect the sale of this land. The large swathes of land along Lake Malawi should be protected for our future generations’ livelihoods and investment opportunities. Future generations of Malawi might have the access to the much needed capital or funds to invest in these areas, and it is in our best interests that we preserve prime land along the lake shore. It would be very selfish of us to deprive our future compatriots of investment opportunities in their own country because of our ineptitude in prioritising national and indigenous interests. According to the Africa Conference on Land Grab’s research, over 55 million hectares of land in Africa has been “grabbed” since the year 2000. These land grabs are happening without any informed consent from development managers and thus millions of vulnerable communities in Africa are at risk of being displaced from their own lands.

Conflicts between Paladin the Australian mining company and the local people at the Kayelekera mining facility shows that Malawi is not ready to manage finite resources in a sustainable manner. Foreign investors scour the earth to find countries with surplus natural resources but with weak or ineffective environmental laws, because it reduces operating costs for firms.  Paladin has been mining uranium for years in Karonga but where do the proceeds go? Can anyone really point out any structure in this country that was built using proceeds from uranium mining? Uranium is a finite resource and if we are not careful, we will deplete our reserves with nothing to show for it. Once again, Malawians are handing out natural resources to the foreigner who will only continue to exploit us.

In the midst of conflicts between the locals and Paladin at Kayelekera, we hear that the government is busy employing foreign companies to explore the possibility of oil in Lake Malawi. Lake Malawi is a source of food and income for the poor living along the lake shore, and if there was to be an oil spillage, we risk the well-being and livelihoods of current and future lakeshore inhabitants. For centuries, our people have lived in harmony with this lake and it would be very selfish of our generation and our leaders to put others at risk because of our voracious greed. In terms of attraction for tourism, Lake Malawi is all we have. I’m sure no Malawian needs any reminder of what happened with Nyika National Park. If it was not for this lake, we would have no tourists coming to Malawi because Lake Malawi is the epitome of attraction in this country. I believe that oil drilling in Lake Malawi is not sustainable because oil is finite resource and also an environmental hazard that can destroy livelihoods and the lake’s Biodiversity. Lake Malawi provides 70 to 75 per cent of the animal protein consumed by both urban and rural communities. It would therefore be negligent for the government to sanction oil drilling in the lake which provides critical habitat for an amazing array of plants and animals including bacteria, fungi, algae, plankton, mussels, snails, crustaceans, insects, fish, amphibians, reptiles, birds and mammals.

When our leaders go outside of this country, they are always selling Malawi to the world as a place of investment opportunities. Indeed Malawi is a peaceful country which offers cheap labour and less competition for businesses, and it is therefore a haven for foreign investors. What we have to remember is that a foreign investor is seeking to make maximum profits, and the only way to do this in a host economy is by “cost reduction”. In Malawi, a lot of native Malawians employed by some foreign companies are being underpaid and exploited for monetary gains which sometimes do not even benefit our economy. A lot of our able graduates are languishing without jobs because some of our so-called investors only employ their relatives in top-tier jobs while Malawians are employed in low-tier jobs. Foreign direct Investment (FDI) is important in modern-day economics and plays the largest part in the growth of economies in a globalised world. However, when FDI is benefiting the foreigner than the host country, there is need to improve the structures to combat unscrupulous employers exploiting the weak and poor. There are a lot of foreign owned companies in Malawi who are exploiting the local personnel simply because our institutional governance structures are either weak or corrupt.  Malawians should not just be used for menial jobs only because we have educated people in this country who can fill up higher positions in foreign owned businesses.

We also have foreign investors who travel hundreds or thousands of miles away to invest in salons, clothes shops or other small enterprise trading entities. As much as Malawi needs investors, I doubt that these small trading entities are bringing any meaningful monetary gains for the country. If our trading partners in the West were following our pattern and forms of foreign investment, it is highly unlikely that their economies would have grown to astronomical heights. Malawi is a poor country that has a high unemployment rate and there is need to protect local entrepreneurs with small business enterprises. If foreigners monopolise the smallholder business market, the local Malawian entrepreneur is at risk of losing his/her business.

If we are to sustain development, native Malawians need to be the primary drivers of the economy and not the other way round. When we give licences or contracts to transnational corporations, Malawians should also be included in these processes to ensure accountability and justice. The Kayelekera mine is a good example whereby we are giving away our uranium to foreigners without any visible gain for the country. If we cannot get a good deal with foreign mining companies, it is not wrong for us to preserve our uranium for our future generations who might be in a better position to manage such resources. In this modern age of technological advancement, uranium plays an important part in the generation of energy. As our population grows, our hydro-electrical plants will not be enough to sustain Malawi and who knows, the future generations of this country might have the capability of setting up nuclear plants! It is therefore important for us to always think for our future generations because they too have the right to enjoy the resources this country has today.

All in all, I believe that we are the generation that is supposed to build a strong foundation for the house of Malawi, and if we fail, our future compatriots will inherit a broken country with little or no promise. And don’t be surprised if at that time, your”investors” all flee, and the country is thrown into chaos and violence.

Development is about continuity and the little we can manage to do in our lifetime is enough for others to carry on. If we do not have the capability to extract natural resources today, then there is no need for us to entrust our wealth with foreigners who are only here exploit our God-granted gifts. We cannot do everything in our lifetime.

Paja amati kuthamanga sikufika!

Leadership for the Africa we Want – Kigali, May 2014

Sponsored by the African Development Bank.

Shorter version focussing on points made by Thabo Mbeki and Benjamin Mkapa:-

My Comments

  • Education has not been a priority for most countries across Africa. As a consequence, Africa doesn’t have enough high quality and decisive leaders and effectors capable of transforming not only their own countries, but the continent. Thus, Africa needs to develop and entrust young people with the knowledge that will empower them to be agents of change. Agents of change capable of prioritising what the continent needs.
  • Further, African people are disunited. Most African people have been divided on political lines such that they often fail to distinguish when our economies are failing because of external influences (or external cause) – which calls for supporting the leadership – and when a national leader’s policies are failing – which calls for criticism.
  • The Neo-liberal Institutions such as the IMF have fed African governments a crippling poison of conditionalities that work for them and their backers but that has made it extremely difficult for sustainable progress to be made across Africa. Before countries like Great Britain, the US, Canada and New Zealand had market based economies operating under market forces, there were long periods of a planned economy in these countries. In fact in Britain, it was only beginning the 70’s and 80’s that state-owned companies were privatised. Before that most infrastructure (not only in Britain) from Railways, Hospitals, Factories, Utilities (Energy companies, Water companies and Gas companies), Mining, Telecommunication companies belonged to the state (or the state was a large and active player in such industries). And that ownership provided employment, tax revenues and dividends to the State. Yet when the likes of the IMF and World Bank came to Africa, they told African leaders that the state must not own anything. The reasons they gave was that it was inefficient for the state to be in business. They were right to an extent but only because the inefficiencies came as a result of the inherent limitations which those state companies possessed. Specifically, these parastatals were not run efficiently as profit-making businesses in a business sense:- you had the wrong kind of leadership calling the shots (not innovators of the calibre and ingenuity of say Lord Alan Sugar, Sir Richard Branson or Sir Philip Green). So how do you expect an organisation to be profitable and innovate if it’s run by the wrong people? Secondly, there was little investment in employee training – so lifelong and transferable skills in tune with technology were not being passed down. To see understand this anomaly consider this: What percentage of over 60’s who were civil servants in the 70’s and 80’s or who were working in government institutions at the time of the privatisations of major UK industry were comfortable with using computers and other technology at the time or even today? Most were not, and even now only a small percentage is conversant with technology. The reason :- Because when they were working for  these government-owned businesses, there was little or no investment into their skills development. In other words when technology was changing, they didn’t have the skills to keep up. Further, there was little competition between these companies and other independent companies so not enough incentive for innovation. No surprises then that parastatals were inefficient and didn’t perform particularly well. But since we now know all these things, as I clearly articulated here, I don’t believe that its impossible to run a government-owned company profitably in this day and age.
  • Ageism is a real problem in Africa. So is Regionalism and Tribalism. Until we begin to entrust people with responsibility on a merit-based criteria (and not by how old they are or from which region they come from, or what religion they are) we’ll struggle to find an edge.
  • Advanced Business Training If Steve Jobs had a business school which he run, what kind of graduates would the school produce? Correct me if I’m wrong, but I think formidable ones. Africa needs to train its young people to be formidable in business…
  • Capital Without money Africa can’t advance, because where will the tools of development come from? Financial Investment in young people (and I’m not talking minute $1000 – $2000 type business loans) is a necessary tool to development.

 

They are building an airport city in Manchester

dx1DSC_0042

 

 

 

 

 

 

Someone please remind me again why I live in this city

Most readers will probably not know that Manchester is quite an experimental city. The first free electric intercity metroshuttle buses in the UK began operating in Manchester. Manchester is set to have a 100MBps fibre optic network corridor interconnecting homes, businesses and universities along the famous Oxford Road. Manchester is home to one of a handful of Fablabs [small-scale workshop offering (personal) digital fabrication] across the world, complete with 3-D printers and such kit, an outfit that helps innovators seamlessly bring their ideas to life. Manchester is now home to Media City, the home of the BBC, a futuristic Media installation that is undeniably as state of the art as it gets. It was in Manchester that Graphene was first successfully isolated in 2004, at the University of Manchester, (and the scientists who discovered it won the Nobel Prize in Physics), and the invention (touted a ‘miracle material‘ and the next big thing) is set to transform technology in ways never imagined before. Beetham Tower, which is home to the Hilton hotel, restaurants and apartments was the tallest building in the UK outside London when it was completed in 2006, and is currently the tallest residential building in the UK. Manchester was the first city in the UK to get a modern light rail tram system when the Manchester Metrolink opened in 1992. Manchester will introduce a water taxi service between Manchester city centre and MediaCityUK at Salford Quays, the only one of its type in the UK. And now, they are building an Airport city, right next to the airport:

This slideshow requires JavaScript.

If you want to do something new and fresh to your town and city, or if you want to push the boundaries, you should look to Manchester, because the chances are, if it’s not been done around here before, it’s either not worth doing, or is about to be done.

At this point I must state the obvious. Yes, you saw it coming, here it goes: Manchester is also home to two of football’s greatest clubs (and recently a National Football Museum), although we can probably argue about the ‘greatest’ bit forever, since curiously enough, despite my unashamed infatuation with this city, I happen to be an Arsenal fan :-).

Oh, and Manchester is the third-most visited city in the UK by foreign visitors, after London and Edinburgh.

But that’s not even half of what makes this city great…

As with most things, it didn’t just start yesterday. Anthony Burgess, Manchester born writer and composer (best known for  A Clockwork Orange), recalled in his autobiography published in 1986 how London “was an exercise in condescension. London was a day behind Manchester in the arts, in commercial cunning, in economic philosophy” For Burgess, Manchester was the real deal. And I think he had a point. This city, in the somewhat narrow frame of liberty in which its officials have been allowed to operate has been a pioneer for many years. During the industrial revolution, German writers and scientists came to Manchester, to observe first hand what these things called ‘factories’ were. With cotton mills springing up everywhere across Manchester, the city’s economy boomed, and created wealth for the industrialists. Manchester became the world first industrialised city, not least because of the textile factories and the Port of Manchester. During this time, it was dubbed ‘Cottonpolis’. Despite the city’s reliance on cotton, and the ‘pro-slavery spirit of America‘ which Sarah Redmond, a free African American Activist and Abolishionist talked about in 1859 when she visited to raise awareness about slavery, the pioneering spirit of Manchester soon had a welcome outcome: In 1862, Lancashire mill workers, at great personal sacrifice,took a principled stand by refusing to touch raw cotton picked by US slaves.

With the cotton industry on its knees, [President] Lincoln acknowledged the self-sacrifice of the ‘working men of Manchester’ in a letter he sent them in 1863. Lincoln’s words – later inscribed on the pedestal of his statue that can still be found in Lincoln Square, Manchester – praised the workers for their selfless act of “sublime Christian heroism, which has not been surpassed in any age or in any country.

P1050639The dynamism didn’t stop there, in 1821 the Manchester Guardian was founded.

It will zealously enforce the principles of civil and religious Liberty, it will warmly advocate the cause of Reform; it will endeavour to assist in the diffusion of just principles of Political Economy. – Prospectus outlining  the aims of the Guardian [Spartacus]

In 1878 the GPO (which became British Telecom, the telecommunications giant BT) provided its first telephones to a firm in Manchester. The world’s first stored program-computer was built in Manchester, at the Victoria University of Manchester by Frederic C. Williams, Tom Kilburn and Geoff Tootill, and ran its first program on 21 June 1948.

And it’s not just inventions and infrastructure that defined the city’s dynamism. Manchester has also been home to some great minds including the Chemist and Physicist John Dalton, Physicist J. J. Thompson, Engineer and Philanthropist Joseph Whitworth, and the Textile Merchant and philanthropist John Rylands.

Karl Marx and Friedrich Engels began to write the Communist Manifesto at Chetham Library (the oldest public library in the English-speaking world) in Manchester. As Luke Bainbridge of the Guardian puts it:

This is the home of the industrial revolution and the city that split the atom, the birthplace of the computer and the Guardian, the suffragette movement, the free trade movement, the co-operative movement, the anti-corn law league, vegetarianism, the nation’s first free library, the world’s first intercity railway and the engine room of rock’n’roll that has produced the country’s best bands of the past 30 years, from Joy Division to Take That. 

Basically, without Manchester, and a lot of its creativity, innovation and history, it’s quite likely that much of the world as we know it wouldn’t be where it is today. Certainly not in the shape that we know. We’d probably still be in the dark ages. Or worse. 😉

And that thought alone, whether you agree with it or think it is far-fetched, is enough reason to learn from what this city has achieved, and continues to achieve.

Links

Coffee, Cococut Water and Car Parks.

Remember my article here, about how the Coconut Water industry was set to grow to over $1 billion? Well, the industry has indeed grown, and most analysts agree it has passed the billion dollar mark. It’s grown so big, even the Chinese are now throwing money at the stuff (see another story here). And here look, coffee!

SSome companies are already mixing the stuff with Cafe Late. How neat is that?

On the subject of business ideas, I saw this today, during my walks:

DSC_0015 DSC_0017 DSC_0016

A car park near MediaCity, the BBC’s new home in Salford. The building has a supermarket, a cafe, some restaurants and at least two lifts. But essentially, it’s a car park.

Standing there in rush hour traffic it wasn’t hard to notice just how busy the place was. Lots and lots of cars driving in every minute. By any measure it’s a lucrative business, and the owner of the car park must be raking it in. Mind you, in the UK, the car parking industry (local authority sector) is worth around £1.5 billion.

Now, I’ve seen such car parks before. In the UK, in the US, in France, even in China. I’ve seen shopping malls which look as if they are firstly a car park, and only secondly a Shopping Mall – atleast by virtue of the enormous size of the car park.

But my point is, as infrustructure across Africa develops, it will be interesting to see if more establishments adopt such integrated and somewhat commercially focussed methods of utilising space.

While countries with better performing economies in Africa (like South Africa, Kenya and Botswana) are likely to already have such structures which have various businesses within a car park, growing up in Malawi, I don’t remember ever seeing anything like this. But again, that was a long time ago.

Ahmed Dassu Letter to President Joyce Banda

On Jun 7, 2013, at 2:42 PM, Ahmed Dassu wrote:

 Excellency

 I refer to your response to my request for an audience during your visit to London for the G8 summit, which was “not available. JB,” which appears both intentionally abrupt and unbefitting of your high office and public servant number one!  Therefore I feel it prudent to address in this email the issues I had wished to discuss with you had you granted me the audience, in order to avoid any misrepresentation or misunderstanding.

 That I share a passionate interest in Malawi and its future with my colleagues Edgar and Thom of Nyasa Times, as I do with many other Malawians is widely known.  Arising from this I had expressed to Edgar and Thom some concerns regarding recent political developments and the continued unabated and open corruption in the sector of public procurement, and asked if Nyasa Times would carry an opinion piece by me, expressing these concerns.  Instead both Edgar and Thom suggested that as you were travelling to London soon I should meet you, Excellency, to put across my concerns directly.  This is what prompted me to request an audience with you.

 Turning first to the political scene.  On President Mutharika death, although I had previously expressed deep reservations about your leadership in a TV interview on MTV, I was amongst the first to publicly demand that constitutional order should prevail, and that as Vice-President you should be sworn in as President.  I convinced others to do the same, including a person who had during President Mutharika’s administration been at the forefront of publicly humiliating you and who had publicly demanded press censorship – now a leading office-bearer in your party, the PP. 

 Indeed on your swearing-in as President, in common with a majority of Malawians, I considered this as a Godsend for a new beginning for Malawi; this conviction was further strengthened by the words of wisdom in your inaugural address to the nation – full of promise and hope.

 Sadly, in office instead of being the stateswoman we had all expected you to be, you practise the politics of marginalisation and victimisation based on whether one is perceived to be your supporter or not. Instead of honouring the high expectations we Malawians built up on your assuming office, your Presidency is built and sustained on the foundations of Members of Parliament, now transformed into political prostitutes who who have been induced to defect from their own parties to your party by patronage and corruption , which the high office of President enables you to practise. Given the opportunity I would have pleaded with you, Excellency that it was not too late for you to live up to the high expectations and hope for a new beginning that were aroused on your ascendancy to the highest office in the country.  That you should focus on how Malawians judge you and how they will perceive you in posterity, and be the stateswoman that the world assumes you are instead of the power hungry, corrupt, vindictive woman, engaged in theft of public funds and who will do whatever it takes to remain in power, which is what a majority of Malawians now see you as doing.  What we see is you practising the politics of marginalisation and victimisation, all glitter in orange with no substance where it concerns democracy, accountability and transparency. 

 You are not minded to accept that you were not elected to the high office of President, just as your party was not elected to govern.  It is blatantly obvious that you are subjecting Section 65 to the patronage and corruption to sustain you an unelected President, in office instead of leading Malawi by consensus.  You have followed in the footsteps of President Mutharika and set aside Section 65 by encouraging resort to courts in the usurping of the powers of Parliament. You have condoned and sheltered those ‘political prostitutes’ who have defected to your party. In a parliamentary democracy there can be no more damning indictment.  Sadly the Speaker himself has fallen victim to allowing the usurping of the powers enshrined in the Constitution for Parliament and become a political prostitute himself.

Turning now to the issue of business, I believe that Edgar and Thom had conveyed to you the need for the wiping out of corruption in government procurement so that companies like mine and others which were prejudiced during President Mutharika’a administration could be encouraged to submit competitive tenders for fertilizer and in other areas of government procurement and thereby reduce costs and improve delivery.  

 It may be foolhardy to ask you to recall, so in the light of what has since transpired, so permit me to remind you that as Vice-President you had publicly said that President Mutharika had institutionalised corruption in government procurement of fertilizer and that you would be exposing the corruption. So it was reasonable, your having implied President Mutharika was corruptly awarding government contracts to selective companies, that these companies were guilty accomplices in the corruption of which you accused President Mutharika.  However in office you have proved no less corrupt, in fact even more so, as immediately on assuming office you proceeded to award contracts for the supply of fertilizer to the very same Indian-owned companies, except for a black indigenous Malawian who, because of his tribe and colour, was identified as a supporter of President Mutharika, when in fact he was no more a supporter of Mutharika then were Abdul Master, Apollo or the other Indians who are paying you millions of Dollars in corrupt deals.

 Indeed the vast unexplained assets and resources now at your and your party’s disposal since you assumed office are ample evidence of the high level of corruption in your government.  I go so far as to challenge the very concept of the Supplementary Fertilizer Subsidy Programme as being a manifestation of the unprecedented corrupt practices and an instrument for the bribing of voters with corruptly acquired funds by you. For as if you were cheating children in a kindergarten you cloud your corrupt misdeeds by telling Malawians that “I personally and my friends will fund the fertilizer for the Supplementary Fertilizer Subsidy Programme”. Where will the funds come from? No doubt the public purse that you are busy looting.

 And who are these friends other than those who are awarded the government contracts by you corruptly?

 In conclusion let me add that I know that in writing to you I expose myself to your reknown vindictive nature and possible victimization by you.  But I shall persevere whatever consequences I am made to suffer, for the struggle for a better, democratic, free Malawi, free from the hunger for power of individual politicians like you have turned out to be, is one I have engaged in since 1972.  My commitment to Mother Malawi is for Malawians to judge.  Indeed, I am convinced posterity will judge me a far better citizen of Malawi  than contemporary politicians like you have done.

God Bless Malawi

 Ahmed Dassu

Source: The Oracle

Another reason why Africans should own their own resources

man-40134_640Last week a well written article appeared on Al Jazeera arguing against the false and somewhat misleading picture of Corruption that is often put out by the western media. In it, it was suggested that over $900 billion a year is lost from developing to developed nations through tax evasion and illicit financial outflows. While this is a major problem for Africa, as was pointed out several years ago by Kofi Annan here, another reason which results in these outflows is that very few major industry (million dollar revenue generating) in Africa is in fact owned by Africans.

The combination of imperialist colonial legacies, poverty, a lack of capital, insufficient education, corruption, plain hypocrisy and other factors has resulted in a state of affairs whereby even capable Africans find it hard to buy into and run their continent’s biggest industries. While there are many Africans doing well in business throughout Africa, they are by far in the minority, and comparatively too few of them on the ground, than say the number of Canadians who own and control multi-million pound ventures within Canada, or say the number of Portuguese who own and control multi-million dollar companies in Portugal.

Thus, this picture inevitably creates an opportunity or gap for foreign corporations and investors to come in, and sweep away ownership of the whole lot – armed with huge amounts of capital. No surprise the profits end up everywhere else but in Africa…

In my view, far from the land grabs of Robert Mugabe (which others have tried to justify – see here and here), another reason in support of more Africans owning their continent’s industry is that doing so could mean that large amounts of money remain on the continent, to be used for education, health  -building hospitals and providing good wages for doctors, eliminating poverty, fighting corruption, policing and security, building infrustracture, improving the plight of women, investment in the youth, creating jobs, etc. It means essential capital is not being wired out to already rich countries. This in my view is a better strategy against poverty, than aid and handouts, whose monies are comparatively miniscule to the monies being siphoned from Africa.

According to the website of Britannia Mining Inc (a US company with operations in Canada and Malawi) here, the Nthale Iron Ore surface deposits which they found before 2009 are estimated from their geological survey to be at least 4.6 million tonnes in quantity. As often happens with these things, especially if we focus on the word ‘Surface’,in practice the deposits can be far larger than the estimate.

Last Friday, on the 7th of February 2014, before close of trading the price of Iron Ore on the international market was hovering around $125 per ton (see latest figures here). Whichever way this price goes (whether up or down) the next few years, 4.6 million tonnes at $125 per ton is still worth at least $575 million, a hefty sum by any measure. Even if we go with the 68% iron ore component indicated on their website, that’s still worth $391 million

Suppose Britannia Mining invested $100 million into Malawi, to cover processing the Ore, overheads including construction, logistics, wages, corporate governance activities, etc, (and it was proved that they had indeed invested such sums because sometimes businessmen overestimate the level of investment when the truth is much lower) I’d think the benefit to the Britannia would be significantly higher and disproportionately in their favour than in the favour of Malawians. Looking at previous examples of resource conflicts involving corporations in Africa, I seriously doubt that first they would invest such sums. Further, I doubt that Malawians or the Malawian government would benefit equally or at least proportionally from the resource. Which begs the question, who actually owns the resource?

As many others have opined elsewhere (see this for example), the unrestrained greed and unguarded capitalism of western businesses in Africa is causing a lot of damage and harm to Africa, and Africans. And that’s even before we get to what China is doing…

Even if the market price of Iron Ore dropped to say below $100, (say it dropped to $65, which is highly unlikely – the last time it hit $100/ ton was back in Aug 2012, and that was only for a very brief period of time), there would still be at least $300 million worth of deposits to be mined.

Don’t you think if the company that was exploiting the deposit was owned or part-owned (say 50%) by the Malawian government, or a group of Malawians, that the majority of the benefit of the resource would remain in the country, as opposed to being wired out of Malawi?

Post Paladin, and the tax outrage they caused when it was revealed that the Malawian tax authorities were missing out on tax revenues worth $200 million, how much tax have Britannia paid to the Malawian government so far, and how much have they made out of Nthale? The reason that question is crucial is because no level-headed Malawian is keen to see Malawi descend into a chaotic easy target where rich corporations (which are already wealthy and well resourced) come into the country and make billions, while the local population remains poor.

And if governments across the world do not speak against unrestrained greed, who will, seeing most governments in Africa are headed by people who have neither the will nor inclination to do so…?

Kenyatta + Branson
image from https://www.facebook.com/myuhurukenyatta

In my view, Africa needs trade partners who will help rebuild the continent, and not those looking for a quick buck, irrespective of the ethics of the means of acquiring that buck.

If you are looking to make money quick, stay away from Malawi. We don’t want get rich quick capitalists or investors. What Malawi needs are Responsible Capitalists, as opposed to a Liberal and unguarded Capitalists – a badge which brings to mind Halliburton’s Iraq heist (or even ILLOVO’s tax avoidance fiasco –  ILLOVO [which is British owned via Associated Foods Limited] is  company that last year posted a 43% rise in profits per share), an incident which it is fair to say has probably been responsible for not only much suffering, but also global unrest.

Depending on who you ask, its undeniable that corporate wrongdoing is currently happening, and the continent of Africa is being systematically ripped off. Yet there has to come a time when the tide turns, and the wrongdoing is forced to stop (sadly it’s not going to stop voluntarily). In the words of the African Development Bank president Donald Kaberuka here:

“The reality is, Africa is being ripped off big time …Africa wants to grow itself out of poverty through trade and investment – part of doing so is to ensure there is transparency and sound governance in the natural resources sector”

In my view this means rectification, and possibly includes learning lessons from those whose policies do not exacerbate the already bad situation; lessons from the likes of Brazil instead of blindly accepting unfair and discriminatory terms from organisations such as the IMF – whose policies towards the poor countries couldn’t be said to be favourable for local ownership of industry.

Maybe Malawi’s mining sector has more to learn from the likes of Vale and Debswana. Debswana is 50% owned by the Botswana government and 50% owned by De Beers. Vale is the world’s biggest producer of Iron Ore, and their profits recently doubled (Interestingly, in the same article Vale says the price of Iron Ore would hit $130 per ton, which it did, confirming the plausibility of my above little theory). They’ve seen an increase in production, which last year hit 73.4 million tonnes of Iron Ore. They are also a major tax contributor to the Brazilian government, with recent tax payments of $9.6 billion, far greater than anything any corporation have had to pay to an African government.

Similar

Its all in the mind

 

brain-1Most Malawians I know are involved in some kind of commercial activity besides their ordinary / daytime jobs. And while many of them have experience and a good grounding regarding how to sell (even those who run micro business or lifestyle businesses), some may not know certain marketing or selling facts/ techniques. It is for their benefit that I have provided this link to these marketing techniques.

President Uhuru Kenyatta’s Speech During the Groundbreaking of the Greenfield Terminal at Jomo Kenyatta International Airport

“Airports today are important vehicles for propelling economic growth. An airport, being the first point of contact by the visitors, be they tourists or businessmen, has a lot to tell about the community and country in which it is located. It can, therefore, influence positively or negatively the level in Foreign direct Investment and indeed the number of people wishing to visit a country….

My Administration is keenly aware of the aviation infrastructure deficit that currently exists not only in Kenya but also on our continent. Without sufficient aviation infrastructure, our region will remain unexploited and expensive for commerce and business.”

Full speech here:- President Uhuru Kenyatta’s Speech During the Groundbreaking of the Greenfield Terminal at Jomo Kenyatta International Airport

I have often laboured with this point on this blog a number of times (see previous articles here, here, here and here). And it’s because it’s a very important point. Before any economic development occurs, one of the critical factors which must be addressed by the leaders of African countries, and which must be a top priority, is the development of first points of contact such as airports to such a level of excellence that they meet global standards.

In other words our Airports across Africa should generally have the same facilities and be of the same standard as the airports in Bangkok, Durban, Moscow, Manchester, Santiago or Wellington.

When that begins to happen, Africa will have moved towards a place where it can compete with other countries across the world.

Manchester Airport : Fact Sheet