Included in this issue: Q&A with Rt. Hon. Mark Simmonds: Africa's huge potential; Making Islamic Finance Work for East Africa; African competitiveness rests on infrastructure investment; and more...


Addleshaw Goddard's Africa Business Group are delighted to publish our May newsletter. We hope you enjoy reading a selection of some of the most interesting business news and articles from around the continent. For a regular stream of business and legal news in Africa, please download our innovative "Doing Business in Africa" App, available for free for ipad users on the App Store or accessible from your browser here.

KROLL

Q&A with Rt. Hon. Mark Simmonds: Africa's huge potential

Kroll's Mark Simmonds draws on his years of experience as British Minister for Africa in describing both the huge potential for business in Africa, as well as the challenges to be found in this "vast and complex continent."

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GBS Africa

Making Islamic Finance Work for East Africa

The Islamic banking industry is growing rapidly as banks all over the world respond to the opportunities presented by this expanding new customer segment with a range of Shariah compliant products. There is no doubt that Islamic finance is an industry that has made tremendous progress and is taking bold steps in East Africa.

Click here for the article by Agnes Gitau

Agnes Gitau is an International Trade & Investment Expert with a focus on East Africa and a partner at GBS Africa.

For more information, please email Agnes Gitau.

NEWS

Investment within Africa

Is it worth it? - The Economist

For outsiders in particular, investing in Africa is strewn with hurdles

Last October MTN, a big South African mobile-telecoms company, hit a brick wall in Nigeria. The cash-strapped government there announced that the firm, which makes 35% of its revenue in the country, had broken rules about registering SIM cards and would be fined about $1,000 for every incorrectly registered account. The total came to $5.2 billion, nearly three times MTN's annual profits in Nigeria. In November the fine was reduced to $3.9 billion on appeal. As this special report went to press, the dispute between MTN and the Nigerian government had still not been resolved.

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What's to blame for sub-Saharan Africa's growth slowdown?

Brookings Global Economy & Development – The Global Connection Newsletter

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Business in Africa

Making Africa work - The Economist

The continent's future depends on people, not commodities

"IS ANYONE here actually hoping to make any money, or are you all just trying to minimise your losses?" The question, asked at a dinner in London for investors who specialise in Africa, showed how the mood has changed in the past year. The financiers around the table—mostly holders of African bonds—all said they were simply trying not to lose money.

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African competitiveness rests on infrastructure investment

Considerable investment in infrastructure using innovative sources of funding is needed to address Africa's low level of competitiveness. Indeed, the Programme for Infrastructure Development in Africa (Pida) estimates that Africa will need to invest up to $93bn annually until 2020 for both capital investment and maintenance. The current level is about $45bn.

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Africa is keen to change terms of engagement with investors

There is no evidence to prove bilateral investment treaties signed by African countries have made them more attractive to foreign direct investment, despite it being the main reason to sign them. The private sector tends to be the main beneficiary of treaties, with governments weakened by a lack of negotiating capacity.These are among the findings of an Economic Commission for Africa report looking at issues about, and the consequences of, investment policies and bilateral investment treaties.

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MalaFX Capital, a ECN Forex broker, is set to commence operations in Africa, with a promise to provide "undiluted ECN trading environment for Forex traders and Investors across the continent".

According to a statement released on Sunday by Comfort Essien, chief executive officer of the company, MalaFX, which was formed by traders, is bringing on board "the best and most unique trading experience" by increasing the awareness to it offers. Essien, a seasoned Forex trader with wealth of experience in the Forex market, said MalaFX Capital, established early this year, is poised to be a world leader in online Forex and commodity trading, offering different products and instruments to trade.

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Atlas Mara Exploring a Bid for Barclays Africa Group

The investment company Atlas Mara Limited, backed by the former Barclays chief executive Robert E. Diamond Jr., confirmed on Tuesday that it was in discussions with a group of investors exploring a bid for Barclays' business in Africa. In March, Barclays said that it planned to sell down its 62.3 percent interest in Barclays Africa Group over the next two to three years, in a strategy shift by James E. Staley, its new chief executive.

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Infrastructure/ Energy/ Renewable Investment

South Africa's Eskom to spend $23.5 bln on new plants, transmission over next five years

South African power utility Eskom will spend 340 billion rand ($23.5 billion) over the next five years on new power plants and transmission lines, the public enterprises minister said on Tuesday. Eskom is building new plants and transmission lines to augment a power-grid that nearly collapsed in 2008. The utility once again struggled to provide power early last year, resorting to enforced blackouts that dented economic growth.

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COUNTRY ANALYSIS FROM THE EASTERN AFRICA ASSOCIATION

  • The East African Community and trade agreements in Africa
  • Kenya – the collapse of two banks
  • The rising influence of China on Kenya's economy
  • Uganda – MPs and tax
  • Tanzania – 2016/2017 budget
  • Ethiopia – on the edge of a humanitarian crisis / foreign investment from China and India
  • Somalia – civil unrest and insecurity as Al-Shabaab carries out deadly campaign of violence

See attached document

Established almost 60 years ago, The Business Council for Africa network supports over 400 companies and entrepreneurs operating across the continent. The Business Council for Africa works closely with its members to promote business opportunities and facilitate sustainable investment across the continent. They organise over 30 African business related meetings in London each year and have 33 In-Country Directors in West and Southern Africa and thus provide a very useful platform for networking for both new investors and those already operating on the continent. The EAA was established in 1964 on the initiative of a number of prominent, mainly British based companies with business interests in East Africa and it now has over 400 member companies from more than 25 different countries. The EAA aims to facilitate successful participation in the economic development of Eastern Africa by member companies. The EAA exists to support the business activities of its members in the countries covered by providing channels of communication and lobbying on common issues, either through the various diplomatic missions, the international financial institutions or directly with the respective national government.

For more information, please email Karen Taylor or John Small.

Key contacts

Andrew Rosling

Andrew Rosling

Partner, Mergers and Acquisitions
London

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