Africa Brief: AU move leaves ICC relations in tatters, CEOs in Africa expect operations on continent to grow and more…
Algeria looks at ‘reindustrialisation’ to reduce dependence on oil and gas
Algeria wants to revive long-neglected industries as a result of the disappointing economic performance due to its reliance on oil and gas. Prime Minister, Abdelmalek Sellal, told business leaders and trade unionists that “reindustrialisation must be the engine of strong and healthy economic growth”. This would result in sustainable employment and a far greater share of gross domestic product (GDP). Oil and gas exports account for more than 95% of foreign currency earnings. The industrial sector accounts for only 4% of GDP, compared with around 25% in the mid-1980s. There was an industrial boom in the 1970s, when investment multiplied 15-fold, according to Mr Rebah, who said that between 1968 and 1980 investment averaged 45% of GDP. Algerian leaders are looking to the country’s industrial potential in the hope of starting a revival, because despite its energy riches, the economy has under-performed in recent years, worsening social problems. The unemployment rate is 21.5%. Overall growth is expected to decrease from 3.3% to 3.1%. Today any revival will need the involvement of the private sector, whether Algerian or foreign, to bring in new technologies. Algeria is widely seen to have an unattractive business climate. Deterrents to private-sector investment include the high cost of doing business, limited access to finance and limitations on foreign direct investment.
For the full story read, Algeria looks at ‘reindustrialisation’ to reduce dependence on oil and gas by Amal Balloloufi, published by Business Day on 14/10/2013
AU move leaves ICC relations in tatters
Addis Ababa – Africa’s relations with the International Criminal Court (ICC) are in tatters after a special summit of the African Union (AU) resolved ‘that cases against the presidents of Kenya and Sudan should be deferred and that serving heads of state and government should be immune from prosecution. The ICC has charged President Uhuru Kenyatta and his deputy, William Ruto, with crimes against humanity over the ethnic killings of about 1,200 people immediately after the December 2007 elections in Kenya. Mr Kenyatta and Mr Ruto said before their election in March that they would fully co-operate with the ICC but there is little likelihood now that the president of East Africa’s most important country will attend the scheduled opening of his trial on November 12. There is doubt over the trial taking place at all. The AU denies it wants immunity for African leaders, but after this summit many human rights groups will beg to differ.
For the full story, read AU move leaves ICC relations in tatters by Elissa Jobson, published by Business Day on 14/10/2013
CEOs in Africa expect operations on continent to grow
African business leaders are optimistic about the prospects for revenue growth over the next year, despite the continent’s stagnant economic climate and challenges of corruption, inadequate infrastructure and a shortage of skills. A survey was done which indicated that 85% of CFO’s in Africa expected their operations in Africa to grow this year. The survey reflected that companies were implementing deliberate growth strategies based on an evolving understanding of the places where they operated, their customers and supply lines. The greatest risks to confidence and growth outlined included bribery, corruption and government not delivering on its promises. Other risks include inadequate infrastructure and a shortage of skills. Three-quarters of African CEOs reported that they were using traditional strategies such as an active succession plan to develop a leadership pipeline.
Excerpt by CEO’s in Africa expect operations in continent to grow by Michelle Curling-Hope published by The New Age on 14/10/2013.
Harare softens approach to indigestion
The Zimbabwean government is willing to discuss the imple¬mentation of the controversial policy with individual companies. Mr Nhema proposed a gradual implementation over five years of the 51% indigenisation programme. Mr Nkhema stated that: “The indigenisation sector is very flexible, it is neither an ambush nor an imposition on the operations of industry.” Industry chiefs said they were essentially not opposed to the indigenisation policy, but were not enthused by the manner in which it had been “overdrilled”.
Excerpt by Harare softens approach to indigestion by Ray Ndlovu, published by Business day on 14/10//2013
Angola to end tax exemption for oil producers blood
Angola, Africa’s largest oil producer after Nigeria, is imposing a consumption tax on petroleum companies that will increase certain costs by as much as 10%, according to government documents. The law, which comes into effect with its publication, requires companies to follow a tax schedule that adds 5% to most services and supplies and double that for equipment rentals. Angola created a special tax reform branch in 2010 to increase revenue and simplify taxation. Mr Luther, Director of the Reform Project, stated that by 2017 or soon after, a value-added tax on finished products and services will replace the consumption tax that is charged on each stage of manufacturing.
Excerpt by Angola to end tax exemption for oil producers blood by David Mcclleland, published by Business day on 15/10/2013
China’s commodities needs ‘will stay strong’
Although China’s economy is slowing, there is still a demand for Africa’s commodities. This is despite some economist predictions that as a result of the economy slowdown so will the commodity demand from Africa. China is Africa’s largest trade partner.
Excerpt by China’s commodities needs ‘will stay strong’ by Gilian Jones, Published by Business Day on 15/10/2013
SA ranks fifth in African index
South Africa ranked fifth out of 52 countries in this year’s Ibrahim Index of African Governance (IIAG). The country has not moved out of the top 10 countries in the IIAG since 2000.
For the full story read, SA ranks fifth in African index by Sapa published The Star Business Report on 15/10/2013
Zimbabwe says no SA nationals lost farms
The Zimbabwean government has denied claims that South African nationals and investors may have lost their land when the country embarked on its land seizure program in 1999 despite the existence of a bilateral investment promotion treaty between the two countries.
Excerpt by, Zimbabwe says no SA nationals lost farms by Tawanda Karombo, Published by Business Day on 15/10/2013