Insights Report – Tomorrow’s Africa Summit

Tomorrow’s Africa Summit

Sense Strategy’s 25 Years Anniversary

30 September 2024

Moderator & Keynote Speaker: Erik Almqvist, Founder and Chief Executive Officer at Sense Strategy, Owner Almqvist Family Office

Speakers:

• E. Ambassador Zaake Wanume Kibedi, Ambassador of Uganda to the UAE
• E. Ambassador Lovemore Mazemo, Ambassador of Zimbabwe to the UAE
• Khaled Hegazy, Chief Operations Officer e& International (Etisalat). Board Member Maroc Telecom and PTCL. Responsible for Regulatory Affairs, Partner Markets and Portfolio Management for e& 15 Opco’s outside the UAE.
• Daniel Kwaku Ganyoame, Executive Director at Africa ICT Right, an ICT-oriented NGO covering 107 schools and 18,000 students in Western Africa
• Watson Vuyo Matsa, COO and Chief Visionary Officer at eSusFarm Africa. Pioneering agri-fintech solutions in Southern Africa

Africa’s GDP is expected to increase more than 7 times between now and 2050 – thus becoming the world’s fifth largest economic region after Asia Pacific, China, Europe, and the US. 

With a GDP of approximately USD 3 trillion and a population of 1.5 billion people in 2024, this summit and panel will discuss bottlenecks and solutions to untapping the growth and investment opportunities of Africa. 

Africa is one of the richest continents in terms of natural resources, with multiple recently discovered significant oil reserves. Exploration, production and financing will be discussed as well as how entire countries can have 99% renewable power generation.  

Whereas most continents will face a slowed down or reversed population growth, more than 1 of 2 children born by the end of this century will be born in sub-Saharan Africa. 

Smartphone adoption and mobile data consumption is growing faster in sub-Saharan Africa than in any other region in the world. At the same time connectivity affordability is a challenge as is cybersecurity which requires cross-country solutions driving the digital economy. 

Africa has the largest uncultivated arable land in the world. 40% of its population work in the sector and yet it is a net importer of food. This calls for new sustainable solutions which will be discussed at the summit.

On Uganda by H.E. Ambassador Zaake Wanume Kibedi, Ambassador of Uganda to the UAE

Almost all (99%) of Uganda’s energy comes from renewable sources, with 93% derived from hydropower from the River Nile and the remaining 6% from solar energy. UAE companies Masdar and Amea Power are playing a significant role in advancing renewable energy with their 150MW and 20MW solar plants, respectively. Uganda boasts a diverse mix of renewable energy sources. The country discovered oil in 2006, leading to the establishment of UNOC in 2013, which was officially incorporated in 2015. Oil exploration and extraction are currently underway in the Kingfisher and Tilenga areas, with an investment of $80 billion. Major players in this project include Total and CNOOC.

Uganda is constructing a 1,445 km pipeline to export crude oil to Tanzania. A portion of the oil will be refined domestically for local use, while the remainder will be exported. UAE oil companies are also exploring opportunities in the downstream, midstream, and upstream sectors.

Uganda is set to establish an industrial park that will encompass petrochemical, agro-industry, real estate, housing, hospitality, and cargo exports. This park will also feature Uganda’s second international airport. The influx of foreign direct investment (FDI) into Uganda has surged by 79% year-on-year.

The African Continental Free Trade Agreement (AfCFTA) is poised to have a significant impact on Uganda and other Eastern African states. By facilitating the free movement of people, trade, capital, and investment, the agreement supports industrial development and value addition across African nations. This, in turn, is expected to boost foreign exchange earnings. Consequently, African countries are anticipated to experience robust growth rates over the next decade.

On Zimbabwe by H.E. Ambassador Lovemore Mazemo, Ambassador of Zimbabwe to the UAE

Companies based in the UAE have operations spanning across Zimbabwe. The real estate and tourism sectors present attractive opportunities for investors. Zimbabwe is in the process of developing a smart city and has established partnerships for the construction of hotels. The high demand for energy is a direct result of rapid industrialization. Amea Power and Skypower are collaborating on projects valued at 2600 GW.

Zimbabwe is keen on exploring gold, lithium, copper, and cobalt mining opportunities. The United Arab Emirates (UAE) ranks as its second-largest trading partner. Tobacco exports are particularly in high demand. Additionally, other commodities are gaining traction in the Zimbabwean market.

The founding fathers of the African Union envisioned a future characterized by both economic and political integration. This vision was realized through the Lagos Plan of Action and the Abuja Treaty, which established regional units dedicated to fostering economic integration. These regional bodies played a pivotal role in dismantling barriers, facilitating trade and cross-border investments, and encouraging dialogue among nations. Furthermore, the creation of subregional pillars facilitated the integration of small islands into the broader continental framework. The foundation of economic integration across the continent was firmly established on these strategic plans.

On Digital Transformation

Mobile penetration in sub-Saharan Africa is on the cusp of reaching 48%, with over 50% of these mobile phone owners now owning smartphones. The continent is leading the global charge in smartphone growth, indicating significant economic development and the emergence of digital economies.

Digitalization is essential for economic growth in Uganda. The Ministry of Information and Communication Technology has established innovation hubs to support this. During the COVID-19 lockdown, a single mother utilized her smartphone to create maps, demonstrating the practical applications of digital technology. Uganda must strive to enhance internet accessibility and affordability across the nation. The Innovation and Digital Policy 2023 is designed to facilitate these efforts.

Zimbabwe has made strides in its digital payment system, but there’s a pressing need to expand its digital infrastructure nationwide. This includes fostering digital government platforms, nurturing digital entrepreneurs, enhancing digital skills, and providing more facilities to elevate Zimbabwe’s digital literacy. Such measures are crucial for accelerating the country’s transformation.

On Investment in the Telecom Sector by Khaled Hegazy, Chief Operations Officer e& International (Etisalat); Board Member Maroc Telecom and PTCL

Africa boasts a youthful population and a high GDP per capita, presenting ample opportunities for investment in the telecommunications sector. Despite facing challenges, investing in this area can significantly boost the economy and foster a positive cycle of growth.

Etisalat is transforming from a telecommunications company into a technology conglomerate. They have established five verticals and secured EU approval for an additional four countries. E& International oversees the operations of the company across 15 countries. Telecom revenue represents a significant portion of their overall revenue.

The International Vertical specializes in managing telecom operations beyond the UAE and related industries. E&E is a systems integrator that offers enterprise solutions globally, acquiring companies in the cybersecurity and cloud architecture sectors. It distinguishes itself from traditional telco companies, positioning itself as a mega system integrator with significant growth potential.

E& is a global provider of enterprise solutions, specializing in technology and consumer solutions. They have expanded their portfolio through acquisitions such as Starzplay, EA, and Money, among others. Recently, Eon Capital acquired a 15.1% stake in the Vodafone Group, marking a continuation of its transformation from a traditional telecommunications company to a telecommunications company.

Bridging the Digital Divide by Khaled Hegazy, Chief Operations Officer e& International (Etisalat); Board Member Maroc Telecom and PTCL 

Egypt and Morocco enjoy a geographical advantage, thanks to the extensive submarine cable networks that connect Asia, Europe, and Africa. Establishing data centres in these regions can offer significant value-added services. To attract major corporations such as Amazon and Microsoft, it’s essential to maintain an attractive investment climate.

TCL acquired Telenor to become the largest operator in Pakistan. The CEO views investing in Pakistan as the most significant decision of his career. He believes that regulators should work to make their countries more appealing to investors by lowering barriers to entry. Countries must also take global competition into account to attract investors. The focus should be on leveraging geographical advantages for monetization.

What makes a country attractive for FDI by Jamal Al Jarwan, Secretary General, UAE International Investors Council 

UAE’s FDI inflow has reached 800 billion dirham and is expected to exceed a trillion dirham by 2024. The UAE prioritizes political stability, security, transparency, and advanced regulations to attract foreign investors. FDI inflow is expected to exceed a trillion dirham by 2024. The UAE is the top FDI destination in the Middle East, North Africa, and South Asia. Compliance with regulations is crucial for competitiveness. India is advancing well in Asia, but infrastructure challenges remain.

The Technology Infrastructure by Daniel Kwaku Ganyoame, Executive Director at Africa ICT Right

Africa ICT Right is dedicated to bridging the digital divide by bringing technology to underserved communities and equipping individuals with the essential skills of the 21st century. Our efforts have led to the establishment of over 100 public schools in Ghana, providing access to technology and educational opportunities. Additionally, we have trained more than 20,000 individuals in STEM (Science, Technology, Engineering, and Mathematics) concepts, fostering a culture of innovation and learning.

Our initiatives encompass a range of activities designed to engage and empower communities. This includes the creation of ICT labs within schools, the promotion of coding and robotics clubs, and the organization of STEM outreach programs aimed at reaching out to local communities. Our goal is to spark a passion for science and technology, preparing students for future careers in these fields.

The organization is dedicated to bridging the urban-rural divide by introducing technology to underserved communities and offering opportunities for both students and adults who might otherwise be left behind. Gender inclusion is a key focus, particularly on women and girls who are frequently underrepresented in the STEM field. We provide training and encouragement to these individuals, aiming to inspire them to pursue careers in these areas. Our mission extends beyond gender equality; it also aims to maximize the talent pool for future technological and tech innovations in Ghana by driving STEM initiatives.

A maternal health app is being utilized to enhance maternal health outcomes within underserved communities in Ghana. It offers support through information, access to healthier pregnancy and childbirth, and assists health facilities in registering pregnant women and monitoring complications. Data from deliveries and immunizations is leveraged to deliver immunization services to children. The app has made a significant impact on the health sector.

The organization is dedicated to emulating Ghana’s achievements in East African countries, focusing on positive transformation, education, technology, and economic empowerment. We are developing a strategic plan to expand into the East Bloc region. This includes scaling our digital literacy program, implementing strategies to strengthen STEM education, and providing digital skills training for entrepreneurs and small businesses. Additionally, we aim to establish ICT hubs and internet access points to bridge the digital divide in rural areas. We plan to collaborate with local partners to tailor our programs to the unique culture and educational landscape of each region. Our three-year plan is set to begin with the implementation of these initiatives starting in January next year.

On the Agricultural Sector by Watson Vuyo Matsa, COO and Chief Visionary Officer at eSusFarm Africa

• The need for enhanced practices in innovation and sustainability is growing due to population growth and land depletion.
• Farmers must explore methods to boost productivity and accurately forecast market demand.
• Innovation should span the entire value chain, from production to consumption, to foster increased productivity, creativity, and sustainability.

Lack of Digital Identity in Rural Africa by Watson Vuyo Matsa, COO and Chief Visionary Officer at eSusFarm Africa 

A team from Rhodes University identified a significant information asymmetry gap in African capital markets, which was impeding financial inclusion. Their goal was to effectively and efficiently operate capital markets across Africa, even in countries lacking first-world infrastructure. It is noteworthy that smallholder farmers in Africa control only one to two-thirds of the value of their agricultural output. Equipping farmers with the necessary information and tools to comprehend their crops and weather conditions is essential.

To address this, the team focused on two key areas:

1. Collecting data and building a digital platform for farmers: This involved gathering data and establishing a digital platform that would provide farmers with access to valuable information and resources.
2. Creating a digital identity for farms: By developing a digital identity for farms, the team aimed to facilitate bankable solutions. This connection between digital information on the farm and the potential for making a farmer financially viable was a central focus.

Understanding transactional and credit history data is crucial for assessing the stability and creditworthiness of agricultural institutions. The lack of comprehensive data on farmers’ histories has necessitated the development of a unique behaviour score to evaluate farmers’ operational activities on the ground. Revenue represents the output, while operations serve as the input. Without monitoring the output of a farm, it was impossible to accurately assess its performance. This deficiency in farmer behaviour data in the market has significantly impeded lending and insurance decisions. By analysing farmers’ behaviours, bankers can make informed decisions about providing finance at the end of the farming season. The behaviour score offers a unique method for evaluating the impact of a farmer’s actions on their output.

The company has developed a Farmer Score, a unique system that evaluates farmers based on best practices, aiming to help them generate extra income from high-quality crops. This initiative marks the company as the sole entity in Africa to undertake such a venture. To assist farmers, they have established a fundamental algorithm designed to guide them through their agricultural processes. This algorithm offers customized recommendations, tailored to each farmer’s needs, encouraging the adoption of new practices and the transition to innovative methods. The company is tracking the rate at which farmers are embracing these changes and is planning to introduce this as its inaugural product within the financial sector.

The company, though not directly associated with the insurance sector, sought government projects to collect data on farmers’ practices. This approach led them to clients in Swaziland, South Africa, and other nations. They discovered that merely designing an algorithm was insufficient; farmers required the ability to upload their data for analysis. It became clear that agricultural programs were not equipped to handle change management effectively. The company realized the importance of data for various purposes, including farmer education, rating farmers, and facilitating access to capital markets. They pinpointed banks and insurance companies that were interested in de-risking farmers to attract their business. The initial step in this process involved identifying which data was crucial and which needed to be collected.

Insurance companies depend on data for financial protection. The first insurance company was established in Uganda, and today, there are several in Nigeria as well. Rwanda’s national agricultural scheme offers subsidies to small farmers for insurance coverage, yet these benefits are deemed too costly. However, blockchain parametric insurance, coupled with AI insights, aims to dismantle structural barriers in agriculture, paving the way for a brighter future.