Business

Opinion: Major World Economies are Becoming Increasingly Isolationist, Except Those in Africa

Published

5 years ago

September 2, 2019

Eric

By Fareed Zakaria

The best word to describe the mood of the global economy these days is gloomy. The pessimism is closely tied to the loss of faith in free markets and free trade, the two forces that propelled the world economy for the past seven decades. The United States, long the staunchest supporter of these ideas, has moved into full-scale mercantilist mode. Britain, the original free trade superpower, is pulling out of the European Union, its largest free-trade relationship. China is striving to become less reliant on foreign firms and global supply chains. Everywhere the trend seems the same. Except in Africa.

Last month, unnoticed by much of the media, Africa’s leaders announced the creation of a continent-wide free-trade area that will potentially bring together 1.3 billion people in a $3.4 trillion economic zone. The success of this project hinges on whether nations actually do reduce tariffs and other trade barriers, but if they do, trade could rise by as much as 50 percent in the next few decades, according to theInternational Monetary Fund. As the IMF put it, “This could be an economic game changer for the continent.”

Africa has six of the world’s 10 fastest-growing economies. By 2050, a new African middle and upper class of 250 million people could stimulate a five-fold rise in demand for goods and services. The World Bank found that a third of all business-regulation reforms from 2017-2018 took place in sub-Saharan Africa, and the continent boasted five of the 10 most-improved economies in the institution’s annual Doing Business Index. More than 400 African companies already take in at least $1 billion in annual revenue. These data points come from a recent Brookings Institution op-ed, “The high growth promise of an integrated Africa,” by Landry Signé and Ameenah Gurib-Fakim.

One country that has bet big on Africa is China. In 2000, trade between China and the entire African continent was $10 billion. Today it’s $200 billion, making China its largest trading partner. Beijing has invested heavily in aid and loans for the region. President Xi Jinping hosted an African summit in Beijing last year and announced that China planned to spend $60 billion in credit, investment and development projects for the continent for the next three years.

Of course, there are many caveats to the rosy picture of Africa. It’s easier to announce the intention to reduce trade barriers than to actually enact such laws. Africa continues to face massive problems in the form of corruption and mismanagement, not to mention conflict. Some of the continent’s promising growth statistics reflect the simple fact that Africa is rich in natural resources, and a growing world economy has created high demand for these products.

The most encouraging aspect of today’s Africa is the striking rise in private business. The region has the highest rate of entrepreneurship in the world, with 22 percent of working-age Africans launching new businesses, compared with 13 percent of their counterparts in Asia and 19 percent in Latin America. Places such as Rwanda that are truly business friendly and have a strong rule of law are experiencing sustained economic growth and rising standards of living.

I witnessed firsthand the energy of African entrepreneurs on a recent trip to Nigeria. I was a guest of the Tony Elumelu Foundation, which has committed $100 million to train and assist 10,000 entrepreneurs across the continent. The energy and optimism of these young men and women, from all 54 of Africa’s countries, were infectious. Their only complaint was that the world was missing the big good news about their continent.

Africa will demand the world’s attention over the coming decades. It will add 1 billion people to its population by 2050 and 2 billion more by the end of the century, at which point more than one in three people on the planet will be African. That demographic boom could create enormous problems if it is not accompanied by job opportunities and political stability. But it could provide the world with energy and dynamism as populations age and growth slows in most of the rest of the world. Much of this will depend on Africa’s leaders, who will have to finally fulfill the promise of the continent and its people. Too many have stolen from their people for too long.

Africans know the price they have paid by being locked out of global markets and of living in countries with limited private enterprise. They understand that the only real and sustainable path out of poverty is expanding free markets that are, of course, well-managed and regulated by effective governments. Much of the world today could be reminded of that simple lesson.

Culled from Washington Post

Business

Italian Oil Giant Eni Gets FG’s Approval to Sell Agip Oil to Oando

Published

1 day ago

July 25, 2024

Eric

Italian oil and gas giant, Eni, on Wednesday announced that it had received regulatory approval from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC) for the sale of Nigerian Agip Oil Company Limited (NAOC) to Oando Plc.

In a statement issued on Wednesday, Eni said it had received formal consent to finalise the deal. It will be the first deal to be approved under the Petroleum Industry Act (PIA) and under the new upstream regulatory body, the NUPRC.

Chief Executive Officer of NUPRC, Mr. Gbenga Komolafe had announced during an industry conference on July 3 in Abuja, that Oando had completed the acquisition of 100 per cent shares of Eni in its subsidiary, NAOC, adding that an announcement was imminent.

Confirming this in the statement, the Italian oil company said it had obtained all other relevant local and regulatory authorities’ authorisations.

“Having already obtained all other relevant local and regulatory authorities’ authorisations, this achievement will allow Eni to proceed to the completion of the transaction for the sale of Nigerian Agip Oil Company Ltd (NAOC), Eni’s wholly owned subsidiary focusing on onshore oil & gas exploration and production as well as power generation in Nigeria, to Oando PLC, Nigeria’s leading national energy solutions provider, listed on both the Nigerian and Johannesburg Stock Exchange.

“NAOC Ltd participating interest in SPDC JV (Shell Production Development Company Joint Venture – operator Shell 30 per cent, TotalEnergies 10 per cent, NAOC 5 per cent, NNPC 55 per cent) is not included in the perimeter of the transaction and will be retained in Eni’s portfolio.

“Eni remains committed to the country through investments in deepwater projects and Nigeria LNG,” the company stated in a statement.

The company also said it was developing plans for economic diversification in the country.

Eni said this includes assessing the potential production of agri-feedstock for Enilive bio-refineries and various nature- and technology-based projects, such as clean cooking initiatives to offset emissions.

Eni has been operating in Nigeria since 1962, actively engaging in hydrocarbon exploration and production, as well as power generation.

Currently, Eni has a substantial portfolio of assets in exploration and production, with an equity production of approximately 40,000 barrels of oil equivalent per day net of NAOC contribution. Eni also holds a 10.4 per cent interest in Nigeria LNG.

NAOC focuses on onshore oil & gas exploration and production as well as power generation, Eni said in the statement.

Aside from Eni, other companies in the process of getting approval are Shell Petroleum Development Company (SPDC), which is selling to Renaissance Consortium as well as ExxonMobil which is selling some of its oil assets to Seplat Energies.

Others are Chappal , which is buying from Total Energies as well Equinor which recently entered into a preliminary deal with the same Chappal Energies to sell some of its assets.

Arise News

Business

NNPCL Invested Only 7.2% in Our Refinery, Not 20%, Dangote Confirms

Published

2 weeks ago

July 14, 2024

Eric

By Eric Elezuo

President, Dangote Industries Limited and Africa’s richest man, Aliko Dangote, has said that contrary to popularly held view that the Nigerian National Petroleum Company Limited (NNPCL) invested 20 percent stake in Dangote Refinery and Petrochemicals, the company has only 7.2 per cent share holding.

Dangote made the revelation while addressing a full house of top media executives during a press parley and tour of the facilities at the Ibeju-Lekki site of the refinery and fertilizer plant.

Speaking matter of factly, Dangote, who said that the success of the refinery will depend majorly on the line of the policies the government of the day take, noted that while NNPC was originally billed to acquire 20 per cent share holding, it could only afford to pay 7.2 percent, which it now owns, having failed to remit the balance, which was due in June.

“NNPC do not own 20 percent stake in the Dangote refinery. They were meant to pay their balance in June, but have yet to fulfil the obligations. Now, they only own a 7.2% stake in the refinery,” Dangote confirmed.

Business

CIBN Appoints UBA CEO, Oliver Alawuba As Chairman

Published

2 weeks ago

July 11, 2024

Eric

The Group Managing Director/Chief Executive Officer, United Bank for Africa, (UBA) Plc, Oliver Alawuba has been appointed as the Chairman of the Chartered Institute of Bankers of Nigeria (CIBN), the Body of Banks’ CEOs.

The CIBN announced this appointment on its website on Monday, July 8, 2024.

This prestigious appointment underscores Alawuba’s extensive experience and visionary leadership in the banking sector, as well as his unwavering commitment towards advancing the financial industry in Nigeria and across Africa.

In his role as Chairman, Alawuba will be at the forefront of fostering collaboration and driving strategic initiatives among the top executives of banks in Nigeria.

Like he has achieved as the GMD of Africa’s Global Bank, UBA, his leadership is expected to bring innovative solutions and strengthen the collective efforts of the banking community while addressing the dynamic challenges and opportunities within the financial sector.

The CIBN also announced the appointment of Mrs. Miriam Olusanya, the CEO of GTBank, as the Vice Chairman of the Body of Banks’ CEOs. Her appointment, alongside Alawuba’s, signifies a strong and unified leadership team poised to enhance the banking landscape in Nigeria.

UBA extends its heartfelt congratulations to Alawuba and Olusanya on their appointment and the Bank is confident that their combined expertise and visionary leadership will usher in a new era of progress and innovation for the banking industry in Nigeria, and that under their guidance, the Body of Banks’ CEOs will continue to play a pivotal role in shaping policies and strategies that will drive sustainable economic growth and enhance the overall stability of the financial system in Nigeria.