Tucci Goka Ivowi, Deputy Chief Executive Officer at the Ghana Commodity Exchange
The framework for successful Intra Africa trade already exists. The seven action points highlighted are both my recommendations and my current views on the status quo. I surmise (unsurprisingly) that what is remaining is to continue to add value, improve the quality of goods and services, and then increase the scale.
1. Recognise the role Diasporan play.
I don’t know if I still classify today, but once upon a time, I was a diasporan. I came to Ghana from the UK on holiday about 18 years ago, and never went back, except for on holidays. On one of these trips back to London I received a Christmas hamper which tickled me and I’m not sure I’ll ever forget it. One of my sisters-in-law gave me a large delightful hamper with lots of goodies in it. One of those goodies was a pack of ‘Chocomilo.’ For those who don’t know what that is, it is a confectionery product produced by Nestlé in Ghana and Nigeria only.
Now the irony for me was that I was the person responsible for the brand and product business in Central and West Africa. But I travelled to another continent and received it as a gift, unbeknownst to my sister in law. I was excited to know that ‘my product’ was so valued that she bought and carted boxes of it from Nigeria during her last holiday. And many others do the same. But it also highlighted for me the relevance and role that diasporans (and multinationals) play in the global trade of African or any country of origin products.
2. Learn from multinationals who successfully contribute to intra-regional Trade
That was just one product. That product is made in two countries using mainly locally sourced raw materials, and mainly local labour from the respective countries. That product is then sent across the ECOWAS region so that consumers in other countries can enjoy it too. They have found audience in multiple countries, they understand the customs, taxes and other legal frameworks of the countries they do business in. African companies can learn a lot from multinationals like Nestlé. They play a positive and beneficial role in Intra-African trade!
So diasporans and multinationals help by:
- Contributing to increase in exports – large volumes of goods are exported and responsible multinationals pay large sums in taxes
- Contributing to introducing goods and to increasing demand in foreign markets – market expansion.
I can’t leave out the strong influence and impact that other aspects of culture have in expanding markets. Thanks to diasporan presence globally, modern African music and film has steadily been expanding its footprint. If Intra Africa trade is supposed to benefit Africa, it sometimes has to reach beyond the shores of Africa. What is attractive globally, becomes attractive locally. Once African film, for example, is appreciated by global markets, it becomes less taken for granted in its home markets.
3. Build Alliances, one person, one country, one step at a time
Alliances are key to any successful venture; even individuals who are establishing their own companies need a string of alliances to succeed. Those alliances may come in the form of investor, advisory, connections, advocacy… These are all useful and in some cases instrumental to business success.
A former team member organised an Innovation Forum bringing together start up business owners from across central and west Africa. At first the participants were a bit suspicious as to why a multinational would bring them together. Did the host organisation want to steal their ideas? At the end, they were most grateful for the opportunity to exchange with people facing similar triumphs and, particularly, hurdles as they were and realised they could learn from each other as some were further ahead in the process.
They even started to recommend to one another suppliers of raw and packaging material and what they had learnt working with trans-border companies. What these types of alliances do is they help create scale leading to better pricing, they provide opportunities for market expansionand so many other softer opportunities. If you can be successful in Cameroun, why not expand into Burkina Faso, perhaps with a local partner? African companies can become global too if they see the benefits and capitalise on strategic partnerships.
African countries are far behind today, making the need to form strategic alliances with one another even more pertinent. There is no solid argument in favour of waiting until all countries are on board, or until ‘everything is ready’ before being able to benefit from synergies and partnerships. Strategic alliances can be formed between one or two countries in strategic areas. With reference to Ghana and Cote d’Ivoire’s recent stance on cocoa, it’s not only the act or the outcome, but it’s the collaborative nature of the bilateral ‘teams’, (from the two Heads of State, to the Ministers, to the technical teams), that we can learn from.
What this type of alliance will do is foster a long running collaboration and start strengthening a country’s position to position it better for growth. As the old adage goes, “too many cooks spoil the broth.” You are are potentially stronger if you develop smaller alliances and build on them. If you wait for everyone, too many different priorities will slow down the process and consequently, progress.
4. To Function effectively, negotiate trade-offs at the onset
A big country like Nigeria being subject to influence by albeit a consortium of smaller countries, will arguably always be a barrier to the effective functioning of a regional trade bloc. It will slow down the take-off of any policy or real initiative. It must be agreed upon that to function in unity, there must remain a certain level of autonomy for individual countries, particularly when it comes to making macro-economic decisions. It is the same for business alliances. Determine the roles each will play before jumping in.
5. The Integration of Infrastructural development within the trade zones should form part and parcel of the Efforts
Even without a trade bloc, African nations would benefit more greatly from trade if transport networks (road and rail infrastructure for one) was better. The increase in the exportability of goods may generate more revenue than that to be derived from tax benefits. Informal trade is everywhere. Reducing structural barriers will propel trade further. So countries shouldn’t limit their infrastructure to within their borders. They should integrate the region as part of their infrastructure planning and development.
6. Stop bemoaning the plight of Africa and become globally Competitive
Until it happens, we won’t stop hearing that what stops Africa from being competitive is the lack of value add that our products and even services offer. Any country that has thrived through trade, has thrived because of value addition. Nation states can start by investing in infrastructure, whilst scaling up industrialisation efforts as a first point of call. Although Africa indexes slightly higher in intraregional trade of manufactured goods vs raw commodities, the value is still low.
And even where commodity trading is still needed, markets can be better structured through, for example, the intervention of a commodity exchange. Commodity exchanges, such as that recently established in Ghana, seek to provide efficient and risk free trading solutions, establish fair and transparent price discovery mechanisms, develop product standards and contracts to protect producers and traders, amongst other things. Lack of structure disturbs markets; exchange rates and nothing else dictate trading behaviour. This is limiting and myopic behaviour which curtails growth in business value for countries and for the continent. Africa should be the originators of many more recognisable quality brands which are the result of adding value to commodities which have African countries as their home.
As the African Continental Free Trade Agreement comes into effect, a good starting point will be to look at the harmonisation of the regulatory frameworks which will be a pre-requisite for smooth implementation of intra-Africa trade and then ultimately, once scale increases, to international trade.
7. Take Action now; refine later
As an entrepreneur, one should:
- Learn more about other African countries; study those markets
- Understand customs and legal frameworks of the countries you are interested in doing business with
- Produce goods and services that will have an audience within the continent
- Create partnerships
- Get going – you will refine your products and services as you go along.
Credit: Tucci Goka Ivowi
Diaspora investments: A must for the development of Africa
Image Source: rupixen.com
It has been three years since his Excellency president Nana Akufo-Addo of Ghana shared some controversial thoughts on Africa’s dependence on aid or support from Europe in a decades long effort to develop the continent.
He was applauded for his bold statement and stance, but many (especially people from the Ghanaian diaspora) thought they were only words. Words they had heard many times before, but without plans or actions backing them. This might be true from their perspective, yet for the current generation of descendants from those who have been sold into slavery, it was good to hear an African leader show some backbone.
“We can no longer continue to make policy for ourselves, in our country, in our region, in our continent based on whatever support that the western world or France, or the European Union can give us. It will not work. It has not worked, and it will not work”.
The Diaspora Is Linked To The Strength of Africa
President Nana Akufo-Addo’s views on European aid are commendable, even if we debate how much he will be able to back up his words with actions.
“The place of the Diaspora, the status of the people in the diaspora, of the African diaspora, is intimately linked with what happens on the continent. An Africa strong and performing, transforms your position, your status here in Europe”.
He was addressing diaspora members in France, but he could have been addressing all people of African descent worldwide. The fact is that his ability to back his words, not exclusively but to an important extent, is contingent on the support he as an African leader receives from the African diaspora.
Remittance Coming From The African Diaspora
As a member from the African diaspora, one might ask: “Are we not supporting enough?”
Ishmeal Lamptey (Source: unsplash.com)
According to the World Bank Sub Saharan Africa received an estimated 48 billion US dollars in remittance funds from the African diaspora in 2019.
A study by Comstock, Iannone, Bhatia published in March 2009 (yes, the phenomenon has been studied for some time now) shows most funds are spend on costs of sustenance (29%), medical costs (16%) and education (12%).
When looking at the order of precedence these costs take in relation to each other, we see that unforeseen costs come first, second are medical costs and the last are for education. This underlines what we all know. The fact that there is often a sense of emergency to these transfers.
The Need To Move From Remittance To Investment In Africa
So, to answer the question of the diaspora, if it is not doing enough…well no. Harsh isn’t it? The fact of the matter is that the remittance funds are our own version of aid to the continent. It is keeping our people our family from dying but it’s not helping with any development.
We, the African diaspora, need to make the transition from remittance to investment. Remittance will always be part of the financial flows, but when seen in relation with Foreign Direct Investments (FDI) from the diaspora, they shouldn’t dominate as they do at present.
Following the content of a few independent journalists, there is now ample proof that at least some in the diaspora are not only willing, but able to move to the continent and start new businesses. But this group is a very small minority. The vast majority will not be able to follow suit and we should not want them to.
The revenues of the use of their human capital is needed to generate the investment flows Africa needs. The challenge Sub Saharan Africa faces is that of aggregation of available funds originating from the diaspora. The funds are clearly there, the industries which need them for we’ve identified, but now we need to create a robust infrastructure to aggregate and get them to their destination.
Like we pointed out in our previous article about thinking sufficiently big; while we keep our eyes on the end goal, we might need to start building one stone at a time. From individual projects, to industries, to the whole economy.
When doing so, we need to keep in mind that Africa is a unique environment. The common instruments of capital allocation used in the world should certainly be our starting point, but not limit our imagination when pooling the diaspora funds and channeling them into the continent.
As we have admonished a few times now; Africa should think BIG. And that also applies to its diaspora. In the coming articles we will continue exploring the idea of “thinking big” in the African context. So please make sure to subscribe to our Newsletter. We invite you to share your thoughts with us on the matter and get a discussion going with us and our other readers.
Article By: Jerrol Cambiel, Chief Executive EU Operations Debnoch Capital
North Ladder Secures $5 Million Series A Financing Round To Accelerate Global Expansion
North Ladder Team (Source: Siddharth Sudhakar)
North Ladder (previously called BuyBack Bazaar), a UAE based secured trading platform for pre-owned luxury assets and electronics, today announced a $5 million Series A funding round led by regional venture capital firm BECO Capital. The new investment will help the company scale up its technology platform, enhance customer experience and pursue further geographic expansion.
The homegrown start-up also revealed that it will begin operating under the new brand name North Ladder effective immediately, representing the company’s strategy of charting new markets and supporting individuals across the globe in their endeavour to elevate their financial situation. The disruptive and innovative technology platform is the first of its kind, providing access to verified buyers of second-hand goods and instant cash. North Ladder currently enables users to sell electronics such as phones, laptops, tablets, and smart watches, as well as luxury assets including watches and cars, with a unique option of buying it back within a few months.
The Series A financing builds on an exceptional year for North Ladder which saw rapid growth of its clients, network of buyers and corporate partnerships. To date, the platform has witnessed over 15,000 transactions in the UAE, with over 85 different nationalities served while earning an impressive 4.9/5 customer satisfaction rating. In 2021, the start-up is looking to establish its presence in the Kingdom of Saudi Arabia and the United States, with a focus on scaling the platform significantly in the next 18 to 24 months.
“North Ladder has demonstrated tremendous success with its unique model of helping customers access immediate funds against their assets. The provision of a seamless and trusted digital platform for the sale of pre-owned goods has immense socially transformative potential at a global scale. We are excited about partnering with them to take their services to the next level,” said Dany Farha, CEO & Managing Partner, BECO Capital.
The company recently appointed Sandeep Shetty, former Managing Director of the core ride hailing business at Careem, as Cofounder and Chief Executive Officer of North Ladder. Prior to Careem he also led the digital transformation program at Emirates NBD and has held leadership positions at McKinsey & Company and GE Capital across India, the United States and the Middle East. Sandeep joins the leadership team of co-founders Pishu Ganglani and Ricky Husaini who together bring years of prior global start-up, financial services, technology and operations experience.
“Our exciting partnership with the region’s leading investor BECO Capital gives us the opportunity to scale operations in the UAE and expand to other strategic markets, with the mission of meaningfully impacting people across all strata of society,” said Sandeep Shetty of North Ladder. “Our global auction brings professional buyers from around the world to compete and provide local customers with the best prices and no hidden surprises.”
Since its launch in 2018, North Ladder has been recognized as one of the “Top 5 innovative start-ups in the MENA region” by PayPal backed accelerator, Village Capital and awarded as an Innovator by Entrepreneur Middle East.
Legacy Premier Foundation Congratulates New World Trade Organisation (WTO) Head Dr Ngozi Okonjo-Iweala
Ngozi Okonjo-Iweala © AFP via Getty Images
The entire team at Legacy Premier Foundation hereby congratulates Dr Ngozi Okonjo Iweala as the new chief of the World Trade Organization (WTO).
With a proud heart and jubilation, we salute our quintessential woman of many feats on this global call to service.
This is a perfect example of a narrative that says “when opportunity meets preparedness success is inevitable”. Madam Director, you are an epitome of this simple quote. Over the years, you’ve carefully built a track record of competence with your records very visible in the public domain.
We are very pleased to send our warmest congratulations on your appointment as the seventh (7th) Director General of the foremost World Trade Organization, also making history as the first African and female to hold this prestigious position.
At this time where the world is battling with the Covid-19 pandemic, with a gradual return to normalcy, there are still some undulating terrains in the global trade landscape. We believe with you at the helm of affairs coupled with 25 years of diplomatic dealings and demonstrated leadership as a World Bank executive, you will saddle the affairs of the WTO and the entire global trade economy through these sensitive times.
We wish you much success in your new post and we look forward to the pleasure of working with you, in the place of making our African continent prominent in the scheme of world trades, and much more rejuvenation of hope that an African has all it takes to get to the zenith of his or her career without any equivocation.
We wish you a resounding success with legendary actions for global impact.
Signed: Dr Remi Duyile, Former VP, Bank of America and Founder, Legacy Premier Foundation
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