The impact of manufacturing on economic development has been widely studied. Very few countries have been able to grow and accumulate wealth without investing in their manufacturing industries, and a strong and thriving manufacturing sector usually precipitates industrialisation. The manufacturing sector is widely considered to be the ideal industry to drive Africa’s development.
There are ever increasing concerns for petroleum exploration and development prospects across Sub-Saharan Africa arising from the dramatic falls in oil and gas prices since mid-June 2014. The primary supply-side reasons are the US shale oil and gas revolution, strong production from conflict regions such as Iraq and Libya, and OPECs November 2014 statement that they would not cut production.
National participation in the development of a country’s resource base is an important goal throughout Africa. To move beyond a symbolic presence in the upstream and play an effective, meaningful role, national oil companies (NOCs) require a clear mandate and sufficient resources, and the support of government.
Universal Health Coverage will be high on the agenda at this year’s meeting, and rightly so. No country can say that it perfectly fulfils the World Health Organization definition of “access to key health interventions for all at an affordable cost, thereby achieving equity in access” and at least 60% of the world’s 192 countries are thought to be a long way off. Currently, more than one billion people lack access to even the most basic healthcare, and over 100 million are pushed into poverty each year through catastrophic healthcare costs.
We are one world; we are affected by the wellbeing of our neighbours and our business partners… The stories of human suffering coming out of West Africa are staggering. The human cost of this strange disease, immense. The fall-out of the epidemic is not just health-related. It is also economic.
Several African countries are expected to see substantial expansion in their agricultural sectors over the medium to the long term because of an abundance of unexploited arable land, government reform programmes, political stability, public and private investment, and/or improved infrastructure. The East African Community (EAC) has a good share of the top ranking nations in this regard; while Uganda’s expansion is not expected to be so strong over the next five years, Kenya, Mozambique, Rwanda and Tanzania however are all countries with promising prospects in the nearer future.
Africa has vast agricultural potential, but there is a large leap from the current system, dominated by small-scale and subsistence farming, to commercial farming where the benefits of economies of scale can be reaped. Nevertheless, the answer lies not only with commercial farming, but also in reducing the potential that goes to waste with small-scale farmers’ lack of access to stable markets, technology and finance.
As much as 73% of African finance executives believe that the role of finance will increase five years from now, according to the findings of our KPMG Africa CFO Survey 2014. This is compared with the 56% obtained in our Global CFO Survey 2013. Moreover senior finance executives all over want to increase their “Decision Support” capabilities and decrease efforts on “Transaction Processing” in the next two years.
“A growing body of evidence suggests that financial institutions and financial markets exert a powerful influence on economic development, poverty alleviation, and economic stability,” says Martin Čihák, lead economist at the World Bank. Financial sectors on the African continent remain largely underdeveloped, while banking industries continue to dominate the landscape in terms of total assets and services. Nonetheless, financial sector development has been on the agenda of African policymakers for some time.
We were having a meeting with a client the other day, on a peculiar tax situation they were likely to face on a proposed contract. We had expressed our view on the issue, but further suggested that the matter be referred to the Federal Inland Revenue Service (FIRS) for their opinion. But there was a problem. The problem, as pointed out by the client, was how much reliance they could place on the opinion from the FIRS.
For Africa to succeed it is imperative to ensure that fundamental resources are available to farmers to enable them to manage their production process more reliably and at a lower cost. This includes the provision of access to agricultural inputs and services including mechanical tools, seeds and fertilisers, amongst others; secure access to land and water resources; infrastructure, particularly roads, so as to ensure good “farm-to-market” access; pre- and post-harvest support (storage, marketing and value addition); and rural microfinance services, especially microcredit.
As the leaders of today’s finance functions continue to work hard to boost their relevance and value to the business, they are shifting their focus outward to those financial management activities that contribute the most to better business decisions that improve the bottom line. Their biggest challenges lie in creating the efficiencies needed to gather and process basic financial data and continue to deliver traditional finance outputs while at the same time redeploying their limited resources to enable higher value business decision support activities.
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- Manufacturing in Africa January 29, 2015
- Oil and gas commercialization in a period of price volatility: Constructively engaging government January 27, 2015
- 5 key recommendations for governments & NOCs January 26, 2015
- Mobile banking series: An overview of why mobile banking remains important for financial inclusion in Africa April 22, 2013
- Telecoms – An African development opportunity September 26, 2013
- Mobile branchless banking in emerging markets February 10, 2014
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