Statement from Trevor Manuel, Chairman of Old Mutual 



Tuesday, 17 September 2019 Mr Trevor Manuel, Chairman of Old Mutual’s board of directors, apologises unreservedly for the following observation he made at the Old Mutual media conference on 13 September 2019, in the context of the pending litigation with the former CEO, Mr Peter Moyo:



“If you
take a board imbued with the responsibility and accountability and you get that
overturned by a single individual who happens to wear a robe, I think you have
a bit of a difficulty.”



Mr
Manuel commented:



“My unguarded observation, although withdrawn, has understandably caused discomfort for which I apologise unreservedly, to the honourable judge presiding and to my fellow South Africans. It was never my intention to show disrespect to the learned judge or his judgement.  I accept that my language was wholly inappropriate to express my disagreement with the decision and sincerely regret the manner in which I did so. My respect for the judiciary is unshaken and rooted in our sound legal process where all voices are heard with remedies available to address differences of legal position. I support the Board of Old Mutual’s efforts to make full use of the appeal process available to Old Mutual to state its case before the Full Court of the Gauteng Local Division of the High Court.  I remain fully committed to the integrity of the judiciary, and to the Constitutional value of the independence of our judiciary.”

“Sorry Judge Mashile” says Old Mutual’s Trevor Manuel

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Nigeria’s Ebola outbreak: Where are we 5 years after?

P&ID judgement: Nigeria’s legal options

By <a href="https://theconversation.com/profiles/elvira-bolat-392016">Elvira Bolat</a>, <a href="http://theconversation.com/institutions/bournemouth-university-1215">Bournemouth University</a> and <a href="https://theconversation.com/profiles/nasiru-taura-773412">Nasiru Taura</a>, <a href="http://theconversation.com/institutions/bournemouth-university-1215">Bournemouth University</a>

Digital technology has created new opportunities for businesses in sub-Saharan Africa to compete on a more equal footing. However, these businesses have yet to enjoy the full benefits because of a difficult operating environment.

Our recently published <a href="https://www.palgrave.com/us/series/15149">book</a>, ‘Digital Entrepreneurship in Sub-Saharan Africa: Challenges, Opportunities and Prospects’, details case studies of economic sectors where digital technologies are making a positive impact.

In Ghana, digital technologies have had an impact on the agriculture sector. Agri-tech firms like Farmable, Farmerline and Esoko have successfully pursued the creation of new business ventures and renewal of existing, matured corporate business models. These agri-tech firms support farmers with pricing data, crowdfunding and communication activities. They are also connecting farmers with buyers as well as helping them work out what differentiates them from competitors.

Digital technologies are playing a role in Nigeria’s agricultural sector too.
<a href="https://primewavesltd.com">Prime Wave </a>, an engineering company that supplies equipment to rice processing firms, and Al-Wabel Trading Company Ltd, a rice miller, have been working together to invent new technological solutions. These are aimed at improving the performance of rice processing. The innovative solutions the company came up with for rice processing can be applied more widely across the agricultural sector. However, these firms have had to overcome regulatory and institutional challenges in the sector. 

<h2>Crossing boundaries</h2>

Digital technologies have also become a part of arts, media and entertainment, in particular in Kenya and Nigeria.

Case studies from <a href="https://link.springer.com/chapter/10.1007/978-3-030-04924-9_4">Nigeria</a> show how small and medium-sized new media players benefit from embracing a culture of experimentation, partnership and continuous learning. These businesses have adopted a “mobile first” mindset. They do this by using mobile technology as a resourceful, quick and flexible solution to do business, connect and promote their content. 

The advertising, game development and media companies that took part in the research had all invested substantially in establishing their own systems for sharing data. These firms also embrace the <a href="https://www.goodreads.com/book/show/45152042-the-passion-economy">Passion economy</a> which centres around social causes and <a href="https://europeansting.com/2019/08/29/how-to-turn-africas-manufacturing-sector-into-a-high-tech-powerhouse/">high access to mobile technology</a> “as driving forces of the business”.

Nigeria’s movie industry, too, has benefited from digitisation. The technology has improved production time and quality. It has also helped extend the reach of movies to wider audiences. Foreign investors are taking <a href="https://techcrunch.com/2019/07/15/canal-acquires-african-film-studio-rok-from-irokotv-to-grow-nollywood/">greater interest</a> in this <a href="https://www.thejakartapost.com/life/2019/07/08/nigerias-nollywood-film-industry-reels-in-foreign-investors.html">fast growing business</a>.

A potential drawback of digital technology in the arts is that cultural artefacts created digitally can also appear in many places at once. So, instead of gaining visibility it is actually lost in the digital crowd. But <a href="http://eprints.bournemouth.ac.uk/31756/">Kenyan artists</a> have managed to use social media networks to build their own “cultural capital” and gain access to physical galleries.

<h2>Innovation hubs</h2>

There’s also been an increase in the number of digital hubs across the sub continent. But do they really help business to start up and survive?

The number of innovation hubs in Africa has grown sharply. There’s BusyInternet and <a href="https://hubtel.com">SMSGH Solutions</a> in Ghana; <a href="https://link.springer.com/chapter/10.1057/978-1-137-57878-5_3">Erik Hersman’s iHub and Safaricom’s M-PESA</a> in Kenya; and Nigeria’s Yaba, a suburb of Lagos labelled the country’s Silicon Valley.

A chapter in <a href="https://www.hiig.de/publication/innovation-hubs-in-africa-what-do-they-really-do-for-digital-entrepreneurs/">our book</a> discusses the social complexity of engaging these hubs. In Accra, the Ghanaian capital, hubs could not provide support that is relevant to local digital entrepreneurs’ circumstances. Entrepreneurs in Harare thought that hubs “wasted precious resources”. Most hubs on the subcontinent also appear to make little contribution to the creation of new businesses. 

Perhaps <a href="https://ssir.org/articles/entry/to_augment_techs_transformation_of_sub_saharan_africa_impact_investors_should_focus_on_the_startup_ecosystem#">“impact-oriented” investors</a> who are passionate about the region should assist digital hubs to make the necessary changes to how they operate.

Local conditions and culture can shape the “ecosystems” in which businesses operate. Some of these conditions, such as corruption, are hostile to business efficiency. The <a href="https://www.newtimes.co.rw/news/inside-africas-bid-digital-economy">challenges</a> are most pronounced in the communications, transport, and energy networks. Much of the region’s infrastructure is inefficient, and more than three-quarters of the <a href="https://www.aa.com.tr/en/africa/sub-saharan-africa-s-future-linked-to-technology/1556198">population remains offline</a>.

Take Nigeria’s movie industry. It needs more than <a href="https://guardian.ng/business-services/bank-sees-opportunity-in-lending-to-creative-sector/">investment</a>. It also needs government to make regulatory changes to protect the creative sector. Government should also prioritise the development of movie industry skills. The same can be said about <a href="https://www.digitalmusicnews.com/2018/09/20/latest-nigeria-music-industry-pricewaterhouse-coopers/">the music industry</a>. 

<h2>Afrocentric digital solutions</h2>

Overall, the book highlights that in a region with multiple social, environmental, economic and political challenges there is a need for more interrogation into how both incumbent and new players in sub-Saharan Africa are shaping the landscape with a view to meeting the <a href="https://www.un.org/sustainabledevelopment/sustainable-development-goals/">UN Sustainable Development Goals</a>.

Digital technologies, as some of our case studies show, can play an important role in transforming African economies. However, digital technology solutions must not just be mere adaptations of dominant Western services and products. They must be aimed at meeting the sub-continent’s needs. In this regard, there’s a lot to learn from Japan. 

Demand for technology after the Second World War resulted in the development of a plethora of advanced solutions which secured Japan’s status as an innovator. 
There are promising new ventures such as <a href="https://edition.cnn.com/2019/04/14/africa/google-ai-center-accra-intl/index.html">Google’s Artificial Intelligence lab</a> in Ghana – the company’s first in Africa. This is a centre of research into digital solutions to Africa’s problems.<img loading="lazy" decoding="async" src="https://counter.theconversation.com/content/120005/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" />

<a href="https://theconversation.com/profiles/elvira-bolat-392016">Elvira Bolat</a>, Principal Academic in Marketing, <a href="http://theconversation.com/institutions/bournemouth-university-1215">Bournemouth University</a> and <a href="https://theconversation.com/profiles/nasiru-taura-773412">Nasiru Taura</a>, Lecturer in Entrepreneurship and Innovation, <a href="http://theconversation.com/institutions/bournemouth-university-1215">Bournemouth University</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/digital-technologies-are-transforming-african-businesses-but-obstacles-remain-120005">original article</a>.

Digital technologies are transforming African businesses, but what are the obstacles that remain?

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By <a href="https://theconversation.com/profiles/oludara-akanmidu-495255">Oludara Akanmidu</a>, <a href="http://theconversation.com/institutions/de-montfort-university-1254">De Montfort University</a>

Nigeria has received a legal hiding after a UK court awarded a private company a US$9.6 billion <a href="https://www.grantthornton.co.uk/insights/quantum-matters--record-usd6.6bn-award-against-nigeria/">judgment debt</a> against the West African nation. The ruling has generated significant attention in both domestic and international media. This is understandable given that the sum amounts to 20% of the country’s foreign <a href="https://thenationonlineng.net/9-6bn-judgment-fraudulent-target-on-our-foreign-reserve-fg/">reserves</a>. This means it poses a significant threat to its economy. 

The big question is: What went wrong? How did Nigeria end up in this costly situation? For the answer, we must look back to January 2010 and a gas supply contract that went horribly wrong.

<h2>The Background Story</h2>

On 11 January 2010 Process and Industrial Development (P&amp;ID), a company based in the British Virgin Islands, signed a contract with the Federal Government of Nigeria. This contract is called a gas supply and processing agreement. Nigeria’s government agreed that, over a 20-year period, it would supply natural gas (wet gas) to P&amp;ID’s production facility. 

In return, P&amp;ID would process the wet gas by removing natural gas liquids and return approximately 85% of it to the government in the form of lean gas. This lean gas was to be returned at no cost to the Nigerian government. 

Based on this agreement, Nigeria was supposed to arrange for the supply of wet gas to P&amp;ID’s gas processing facility which it intended to build in the country’s Cross Rivers State. This required the government to construct pipelines and arrange facilities for transporting the wet gas. The government failed to do this for three years. 

P&amp;ID viewed this failure as a repudiation of the contract. In simpler terms, this means that the government renounced their obligation under the contract. Consequently, in March 2013, P&amp;ID began an <a href="https://www.grantthornton.co.uk/insights/quantum-matters--record-usd6.6bn-award-against-nigeria/">arbitration</a> action against the government before a London tribunal.

Clause 20 of the agreement, which both parties signed, provided that any disputes were to be resolved by arbitration with the seat of arbitration being London, England or any other place agreed by the parties. Nigeria tried to contest this, but its appeal to have the tribunal sit in Nigeria failed.

At the tribunal, P&amp;ID <a href="https://pacer-documents.s3.amazonaws.com/36/194469/04516479471.pdf">claimed</a> that it had invested $40 million in the project even though it had not acquired the land or built any facilities for gas processing. It claimed damages of about US$6.6 billion dollars: the amount of the net income it would have earned over the 20-year period of the agreement. 

In response, the government argued that the damages claimed were not a fair and reasonable consequence of the government’s breach of the agreement. This is because P&amp;ID never commenced building the gas processing facility. It also argued that P&amp;ID should be awarded only three years’ worth of income as by that time, the company should have found some other profitable investment which would reduce its losses from the breach. 

Similarly, the government objected to the measure of estimated expenses and income stream which P&amp;ID used to calculate its damages claim. 

<h2>The tribunal’s decision</h2>

In July 2015 the tribunal decided that by failing to fulfil its obligations, the government had repudiated the agreement. P&amp;ID was therefore entitled to damages. 

In January 2017, the tribunal by a majority of 2 to 1 made a final award of US$6.597 billion together with interest at the rate of 7% starting from 20 March 2013 until payment is made. The 7% <a href="https://pacer-documents.s3.amazonaws.com/36/194469/04516479471.pdf">interest</a> reflects what P&amp;ID would have paid to borrow the money or earned by investing the money in Nigeria. 

Following the tribunal’s award of damages, in March 2018, P&amp;ID brought an action before the Queen’s Bench Division of the English Commercial Court. It wanted permission to enforce the damages awarded by the tribunal. Despite delays by the Nigerian government, on 16 August 2019, the court made an order enforcing the tribunal’s final award which now stands at about $9.6 billion. 

In making this award, the court noted that the damages awarded were purely compensatory and not intended to punish the Nigerian government. The court also confirmed that there were no public policy grounds on which the award should not be enforced. This decision converts the arbitration award to a legal judgement. 

This case perhaps highlights issues with Nigeria’s ability to effectively manage its oil and gas resources as well as its facilities. Between January and June 2019 alone, it is reported that Nigeria <a href="https://guardian.ng/news/why-crude-oil-losses-persist-despite-huge-surveillance-contracts/">lost</a> 22 million barrels of crude oil.

These losses have been largely attributed to pipeline vandalism and aged pipelines. The Nigerian National Petroleum Corporation recently spent billions on oil pipelines maintenance. But other problems, such as <a href="http://saharareporters.com/2018/11/20/exclusive-protests-nnpc-awards-1848m-contract-without-following-due-process">corruption</a> and fraud in awarding security surveillance contracts for pipelines, persist.

<h2>Next steps</h2>

The $9.6 billion appears to be the largest amount of damages awarded against Nigeria to date. Evidence however suggests this is not the first time that Nigeria has failed to meet its contractual obligations. In 2016 it was reported that investors in Nigeria’s power sector <a href="https://qz.com/africa/591036/investors-are-threatening-to-pull-out-of-nigerias-fragile-privatized-power-sector/">threatened</a> to pull out due to the government’s failure to meet its contractual obligations.

This case also demonstrates an ongoing issue with the government’s attitude to critical infrastructural projects. The <a href="https://www.researchgate.net/publication/309943763_Politics_of_Hydroelectric_Power_Development_in_Nigeria_A_Case_Study_of_the_Mambilla_Hydroelectric_Power_Project">Mambilla</a> hydroelectric power project is a case in point. In spite of the huge potential offered by the project, it has been plagued by several controversies ranging from corruption and embezzlement of funds to the “irregular” awarding of contracts, and a general lack of political will. 

The Nigerian government is yet to pay the judgement debt. <a href="https://www.vanguardngr.com/2019/08/fg-alleges-conspiracy-in-9-6bn-judgment-debt/">Allegations</a> of domestic and international conspiracy surrounding the agreement continue to abound. For now, the government has said that it intends to appeal the amount awarded.<img loading="lazy" decoding="async" src="https://counter.theconversation.com/content/122740/count.gif?distributor=republish-lightbox-basic" alt="The Conversation" width="1" height="1" style="border: none !important; box-shadow: none !important; margin: 0 !important; max-height: 1px !important; max-width: 1px !important; min-height: 1px !important; min-width: 1px !important; opacity: 0 !important; outline: none !important; padding: 0 !important; text-shadow: none !important" />

<a href="https://theconversation.com/profiles/oludara-akanmidu-495255">Oludara Akanmidu</a>, Lecturer in Law, <a href="http://theconversation.com/institutions/de-montfort-university-1254">De Montfort University</a>

This article is republished from <a href="http://theconversation.com">The Conversation</a> under a Creative Commons license. Read the <a href="https://theconversation.com/explainer-how-nigeria-got-hit-with-a-9-6-billion-judgment-debt-in-london-122740">original article</a>.

Explainer: A UK court hit Nigeria with a $9.6 billion judgment debt, how did the West African country end up in this costly situation?

JOHANNESBURG (Reuters) &#8211; MTN Group Ltd said on Tuesday the chief executive officers of its Zambian and Cote d’Ivoire units would step down at the end of the month.



Africa’s largest mobile phone operator said Zambia’s Philip van Dalsen, who joined MTN in 2012 as CEO of MTN Cyprus, would be replaced by MTN Rwanda CEO Bart Hofker, in October.



Mitwa Kaemba Ng’ambi has been appointed as the new CEO of MTN Rwanda.



The firm said Freddy Tchala, its Cote d’Ivoire CEO, who had a 17-year stint at the firm, would also be leaving at the end of September with his replacement still to be announced.



Spokeswoman Karen Byamugisha said van Dalsen and Tchala are both stepping down due to personal reasons.



MTN has a presence in 21 countries in Africa and the Middle East.



Reporting by Tanisha Heiberg; editing by Jason Neely

CEOs of MTN’s Zambia and Cote d’Ivoire units are stepping down

NAIROBI (Reuters) &#8211; Somalia’s economy is expected to grow by 2.9% this year, from 2.8% last year, before growth quickens to 3.2-3.5% in the medium term, the World Bank said on Monday.



The Horn of Africa country has been in turmoil since 1991, when clan warlords overthrew President Siad Barre and then turned on each other. Over the past decade it has been hit by famine and sporadic terror attacks by al Qaeda-linked militant group al Shabaab.



The higher growth forecast for the next three-to-five years would depend on the country being able to sustain its current economic reform momentum, the World Bank said in a statement.



Tax collection by the government increased by 29% last year, as the economy recovered from a drought the previous year and the government changes its tax policies, the World Bank said.



“While this progress is&nbsp;encouraging, the available fiscal space remains insufficient to meet expenditure needs&nbsp;(for) education and health&nbsp;sectors,” the bank said.



It asked the government to form a fund dedicated to education to allow authorities in Mogadishu to mobilise more cash from regional states and other partners to support learning.



In May, the International Monetary Fund said Somalia’s economy was on the right track but warned that it was still vulnerable to fragile security, climate change and poverty.



Reporting by Duncan Miriri; Editing by Toby Chopra

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JOHANNESBURG (Reuters) &#8211; South Africa’s rand strengthened against the dollar on Monday, with momentum reignited by upbeat remarks from the U.S. Federal Reserve chairman and a Chinese economic stimulus package.



At 0734 GMT the rand was 0.34% firmer at 14.7700 per dollar from an overnight close of 14.8200.



Fed Chair Jerome Powell said on Friday in Zurich the central bank will continue to act “as appropriate” to sustain the economic expansion in the world’s biggest economy, sticking to a phrase that financial markets have read as signalling further interest-rate reductions ahead.



Powell’s remarks came as the Chinese central bank moved on Friday to cut how much cash banks must hold in reserve, releasing liquidity to shore up an economy hit by the Sino-U.S. trade conflict.



Easing policy is also expected in the Eurozone later this week when the European Central Bank (ECB) governing council meets.



“Risk-on trading patterns stemming from this move will be positive for emerging market assets this week,” Rand Merchant Bank’s Siobhan Redford said in a note.



Locally, investors will this week set their eyes on manufacturing and mining production data, which will provide an indication of the activity in the primary and secondary sectors of the economy.



“We expect the rand to trade sideways today and drift around the 14.80 level, but “risk-on” is still evident in the market thus we have a slight bias toward the rand drifting stronger,” Andre Botha, Senior Dealer at TreasuryONE said in a note.



In equities, the broader All-Share index inched up 0.04% to 55,615 points, while in fixed income the yield on the benchmark government bond due in 2026 stood at 8.15%.



Reporting by Nqobile Dludla, editing by Ed Osmond

South Africa’s rand strengthens, reignited by upbeat remarks from U.S. Federal reserve chairman

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NAIROBI (Reuters) &#8211; Kenya’s central bank on Monday approved KCB Group’s acquisition of National Bank of Kenya.



KCB is Kenya’s biggest lender by assets. Lenders in the East African nation have turned to consolidation to boost profit growth after the government capped commercial interest rates in 2016, crimping their margins.



NBK was founded by the government in 1968 but is now listed on the Nairobi Stock Exchange.



Reporting by George Obulutsa; Writing by Maggie Fick; Editing by Katharine Houreld

article

“Sorry Judge Mashile” says Old Mutual’s Trevor Manuel

World Economic Forum: Bestselling author Robert Kiyosaki shares his lessons on investing, financial education

Nigeria’s Ebola outbreak: Where are we 5 years after?

P&ID judgement: Nigeria’s legal options

Digital technologies are transforming African businesses, but what are the obstacles that remain?

Why Siemens believes East Africa is an investment hotspot

Digging deeper into the politics of xenophobia in South Africa

Naspers vs Prosus: Where is the value?

Explainer: A UK court hit Nigeria with a $9.6 billion judgment debt, how did the West African country end up in this costly situation?

CEOs of MTN’s Zambia and Cote d’Ivoire units are stepping down

Somalia’s economy expected to grow by 2.9%, what you need to know

WEF Africa Debate: Africa’s Economic Update

John Deere Africa re-energising its vision for Africa

South Africa’s rand strengthens, reignited by upbeat remarks from U.S. Federal reserve chairman

Namibian president Geingob on the good, the bad and ugly: Zimbabwe’s founding father

In conversation with John Sanei on his latest book ‘FOREsight’

Kenya’s central bank has approved KCB Group’s acquisition of NBK

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Advertise With Us

article

“Sorry Judge Mashile” says Old Mutual’s Trevor Manuel

World Economic Forum: Bestselling author Robert Kiyosaki shares his lessons on investing, financial education

Nigeria’s Ebola outbreak: Where are we 5 years after?

P&ID judgement: Nigeria’s legal options

Digital technologies are transforming African businesses, but what are the obstacles that remain?

Why Siemens believes East Africa is an investment hotspot

Digging deeper into the politics of xenophobia in South Africa

Naspers vs Prosus: Where is the value?

Explainer: A UK court hit Nigeria with a $9.6 billion judgment debt, how did the West African country end up in this costly situation?

CEOs of MTN’s Zambia and Cote d’Ivoire units are stepping down

Somalia’s economy expected to grow by 2.9%, what you need to know

WEF Africa Debate: Africa’s Economic Update

John Deere Africa re-energising its vision for Africa

South Africa’s rand strengthens, reignited by upbeat remarks from U.S. Federal reserve chairman

Namibian president Geingob on the good, the bad and ugly: Zimbabwe’s founding father

In conversation with John Sanei on his latest book ‘FOREsight’

Kenya’s central bank has approved KCB Group’s acquisition of NBK

News Tips

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