Over the course of history, humans have been trading goods and services using different means. All these means have something in common - the agreement of their value, and thus their use in operations. One example of an ancient form of human exchange was witnessed in Micronesia where they used an exchange method called the ‘yap’ which were massive ray stones. These ray stones were so big that people were unable to move them, however they were still being used as a means of exchange just by knowing who was the owner of which part of the ray stone. The idea behind this is simply that ray stones or any other exchange mean does not have any intrinsic value apart from the fact that people came to an agreement of their value. Cryptocurrencies could be interpreted as the digital version of the ‘yap’ ray stones. Just like internet has changed the way we communicate in modern day, cryptocurrencies are about to change is a modern, digital means of exchange with an agreed upon value. Cryptocurrencies are digital currencies that are not ruled or governed by any institution. They are designed to be used outside of the intermediary rule that is applied today by financial and governmental institutions. It introduces a very independent, yet very secure system. According to the Coinmarketcap, as of August 2017, there were 843 currencies, where Bitcoin, Ethereum, Ripple, Bitcoin Cash and Litecoin remain the best ones mainly based on their value in USD and their circulating supply. Bitcoin alone has on average daily transactions of 288,953 which is the equivalent of 150 million USD. In addition to that, it is important to mention that Bitcoins are released through a process of mining. In the cryptocurrencies system, accounts given to the users are similar to simple blank sheets of paper. In these sheets, every user has to write down any transaction they were part of. What is special about this system is that any transaction written by any user appears in every other users’ sheet. This essentially gives any user the access to transactions happening in the whole system. The only difference is that the users are connected through a computer code network rather than paper sheets. The rationale behind this system of sharing everyone’s transactions is having everybody else confirm their ownership of coins following the basic and historical exchange system rule. The list of all the transactions is called the blockchain system. This blockchain technology works like a database in which all the transactions are stored, and that automatically performs calculations right after any transaction to update the users’ account and show each users’ balance. Cryptocurrencies are growing in popularity and increasingly been used in African nations. According to an article written by Rainer Michael Preiss, an Adjunct Researcher at NTU_SBF Center for African Studies, digital currencies, primarily bitcoin are increasingly taking roots in countries like South Africa, Ghana, Kenya, Botswana, Zimbabwe and Nigeria. Various factors make Africa a potential platform for a successful blockchain economy yet one of the main possible reasons for its growing popularity would be that Africa has a need for an alternative to its local fiat money mainly due to its lack of reliability and accessibility. Bitcoin and cryptocurrency systems in general suggest not only a better alternative to fill these existing gaps but also an opportunity for the population to control their wealth and enhance transparency, giving birth to a new era of stronger social justice in Africa. This innovative means of trade is about to update the way humans exchange and perform transactions. It suggests a practical and transparent way of doing so. These advantages are simplifying the process of trading and could potentially solve certain social and financial issues faced within societies. Tareq Amhoud, Analyst at Infomineo. Sources: https://coinmarketcap.com/ https://www.howwemadeitinafrica.com/cryptocurrency-great-african-opportunity/59402/
Although sub-Saharan Africa has not been famous for its status as a leader in female inclusion within the economic sector, African women are surprisingly beating the odds and defying the obstacles in the field of entrepreneurship in the region. High Female Entrepreneurship Rate Holding a comparison between some of the most developed economies in Africa and in other regions, Nigeria outranks the US and the UK in terms of percentage of entrepreneurs among women with a rate of 41% for the African country against 10% and 5.7% for the two developed countries respectively. Yasmin Belo-Osagie, co-founder of the organization She Leads Africa, stated that, “Sub-Saharan Africa has the highest rate of female entrepreneurship across the globe, with more women starting businesses in Africa than anywhere else in the world.” The extent of the presence of female entrepreneurs is, however, not symmetrically spread across all African countries. Some strong leaders do drive up the rate in the region, namely Kenya, Ghana, Nigeria and Zambia. In fact, the percentage of female entrepreneurs in the three latter surpasses 50% of their total pool of entrepreneurs. Barriers to Female Entrepreneurship The aforementioned figures become even more impressive when considering that the road for African female entrepreneurs is not paved with roses. Women entrepreneurs are facing and circumventing various obstacles pertaining to the social context prevalent within their countries. The dominant culture in sub-Saharan countries is still one that expects women to hold a traditional role confined to home making and child rearing. This has been supported by a study published by the French Development Agency in 2013, which reported that “Time surveys from 11 cities in sub-Saharan Africa show that women spend more time on domestic activities than their male counterparts regardless of household status—head of household, wife, or daughter.” Hence, society might not be open to female entrepreneurs pursuing business ambitions that would take them away from their homes. Business is all about networking. Well, that’s another closed door in the face of African women. Indeed, most networking events take place in mostly male-dominated venues, such as bars of membership clubs, where a woman’s presence by herself might be ill-perceived by social standards. African female entrepreneurs also have limited access to finance in comparison with their male counterparts. Experts estimate the unmet yearly financial needs for women-owned businesses worldwide to be between $260 billion and $320 billion. According to the 2014 Findex report, only 30% of women in sub-Saharan Africa have access to bank accounts. Besides, women in Nigeria and other developing economies have shown to be 20% less likely than men to have a bank account and 17% less likely to have borrowed formally. Factors such as legal restrictions on women to open bank accounts without a male relative’s authorization do contribute to the low account penetration rate among women in the region. Initiatives for Female Entrepreneurship Development Despite the presence of these barriers, there are various development initiatives set in different African countries aiming to alleviate the difficulties and promote female entrepreneurship. In east Africa, 1,200 micro-businesses and 200 small and medium businesses benefited from the Women’s Entrepreneurship in Renewables Project (wPOWER) since its launch in 2013 by the U.S. State Department. The aim of the project was to train female solar entrepreneurs in business management and project financing. In Zambia, the “WECREATE” program launched by USAID has mentored 28 female potato farmers in 2015 on how to expand their business operations. MasterCard has, on its part, committed to three partnerships directed at promoting women entrepreneurship in Egypt, Nigeria and South Africa. These partnerships will be centered on providing young African women with the necessary education, training and mentorship to develop financial literacy, and providing them with easy access to a network of women with an interest in entrepreneurship. Empretec, a capacity-building program created by the United Nations Conference on Trade and Development (UNCTAD) that assists aspiring and female entrepreneurs in strengthening their entrepreneurial and business skills, was recently launched in Kenya, Ghana and South Sudan. The second batch of 40 female entrepreneurs completed the Empretec course on entrepreneurial skills in South Sudan in October 2016. The legal situation in the region is improving as well. According to the World Bank’s 2014 Gender at Work Report, sub-Saharan Africa has reduced the number of gender discriminatory laws against women, mainly regarding property ownership and inheritance rights, by more than half between 1960 and 2010. To sum it all up, African female entrepreneurs are fighting their way to the top despite discouraging cultures and unfavorable business environments with the increasing support of international organizations, local governments, and corporate sponsors that channel their resources and expertise into helping female entrepreneurs fulfill their ambitions. Meryem Khaled, Associate at Infomineo References [1] http://www.idgconnect.com/abstract/10416/sub-saharan-africa-highest-female-entrepreneurship-rate-globally [2] http://documents.worldbank.org/curated/en/884131468332686103/pdf/892730WP0Box3800report0Feb-02002014.pdf [3] http://thenationonlineng.net/financial-inclusion-can-boost-women-entrepreneurship-others/
Located in the southernmost part of the African continent, South Africa shares borders with six neighboring countries: Botswana, Namibia, and Zimbabwe to the north, Mozambique and Swaziland to the east, and surrounding the kingdom of Lesotho. The country's climatic conditions vary, with a predominantly semiarid climate and a subtropical climate along the east coast, characterized by sunny days and cold nights.[1] Notably, agriculture in South Africa plays a crucial role in its economic landscape. The World Bank classified South Africa as an upper-middle-income economy until 2015. The Role of Agriculture in the South African Economy South African population annual growth currently stands at 1.6%.[2] Meaning, the country will be home to over 80 million people by 2035. Therefore, food production must more than double—against fewer natural resources—if the country is to feed her rising population. Agriculture’s contribution to total Gross Domestic Product (GDP) has been declining since 1960 when the sector contributed 10% to 2.5% in 2015.[3] The trend is a global phenomenon, as countries develop from primary industries based economy to the secondary or tertiary sector based. However, despite its declining contribution to the GDP, agriculture remains a significant provider of employment in South Africa, especially in the rural areas. The sector is a major foreign exchange earner. Commercial agriculture is estimated to contribute more than 5% of the country’s labor force. In 2013, it generated about R147.4 billion in income and R116.9 billion in expenditure. The sector still remains one of the primary creators of jobs in the country with nearly 20% of all households engaged in agriculture.[4] Agriculture in South Africa: Key Statistics South Africa classifies 79.4% of its land as agricultural, with the permanent pasture accounting for 69.2%— suitable for grazing and livestock farming. Animal husbandry is by far the largest agricultural sector in the country. In 2011, arable land was 9.9%, forest 7.6%, permanent crops 0.3% and the rest of agricultural activities accounted for 13%.[5] In other words, climate-soil combinations leave just 12% of the country as suitable for the production of rain-fed crops. Strictly, only 3% is considered fertile, falling short of countries like India, where arable land accounts for more than 50% of the country land area. The country's rainfall is not evenly distributed across the country, with water availability being one of the limiting factors of production in South Africa. Currently, up to 1.3 million hectares of land are irrigated, producing 30% of the country’s crops. Up to 50% of the country's water is used for agricultural purposes.[6] Why is Agriculture in South Africa one of the world’s most productive and robust? Despite the above shortcomings, The country is not only food self-sufficient but also a net food exporter— making it one of the less than ten countries (the US, Argentina, Canada and Australia among others) globally that exports food regularly. The country’s commercial farming is well developed despite the fact that majority farmers are still engaged in subsistence-focused practices especially in the rural areas. Grain industry Producing about 30% of the country's total gross agricultural production. Maize, wheat and sunflower account for the largest area of farmland. Up to 15,000 farmers produce maize, most of whom are in the northwest, northern, and eastern Free State, the Mpumalanga Highveld and KwaZulu-Natal midlands. The country is the top maize producer in Africa and 12th in the world, behind some of the world’s largest producers such as the US, Argentina, Brazil, and Mexico among others. The country produced eight (8) million tons of maize in 2015.[7] Wheat is produced mainly in the Western Cape and the eastern parts of the Free State. Average wheat production has been constant over time against a steady increase in consumption, leading to remarkable rise in imports to meet local demand. Barley which is another important grain especially in the brewing industry is produced mostly on the southern coastal plains of the Western Cape. The region accounts for over 98% of the country’s barley production. Sugar industry South African sugar industry ranks among the top 15, out of the 120 main sugar producing countries in the world. Sugarcane production mainly stretches across two provinces of Mpumalanga and KwaZulu-Natal, and is grown by over 24,000 registered growers. Processing of the cane in these regions is through about six milling companies that are operating in the cane-growing areas. The industry produces over 2 million tons of sugar per season, with up to 75% of this marketed in the Southern African Customs Union (SACU) and the rest exported to other African markets, and Asia among others.[8] Livestock industry The livestock is the largest agricultural sector in South Africa. The country is home to about 14 million cattle and almost 30 million sheep.[9] Overall, the country’s livestock production has kept pace with the local demand for the red meat while the milk production has been relatively constant. However, imports of dairy products exceeded exports in the last decade. The case is different from poultry subsector which has seen significant increase in production over the last 20 years. Despite the remarkable significant increase in poultry production, the country is still unable to meet the massive increase in local demand for white meat. Consequently, chicken is currently one of South Africa’s largest agricultural imports. Fruits South Africa is a major producers and exporter of some of the highest quality of deciduous fruit and citrus. Western Cape and in the Langkloof Valley in the Eastern Cape are the main deciduous fruit growing areas. Important export groups are wine, citrus, grapes, apples, pears and quinces. The industry's export earnings account for more than 10% of South Africa's total agricultural export’s earnings.[10] Challenges in the agricultural sector Since 1994, South Africa has faced a myriad of challenges, ranging from the country’s decision to play by the global rules of free trade, lack of adequate land reforms to insufficient support to a large number of farmers. While liberalization was aimed at making South Africa compete with some of the best in the world, the critical aspect (support for the players) was lost. The support was instrumental in facilitating the actors' effort to compete. In contrast, the competing countries were very supportive of their sector players. Land reforms were also unable to keep pace with the expectation without risking the country’s productivity. In fact, only 7.5% of the land targeted for redistribution to black people has so far been transferred, a situation that is likely to lead to proposals that could be counterproductive to the sector.[11] Regulatory framework Although its contribution to the country’s economic growth is declining, agriculture remains a key focus of the country's Development Plan, with the government spearheading a number programs aimed at promoting commercially oriented smallholder farming. The sector has seen some radical changes in the recent past. Previously, the industry was heavily regulated with financial concessions and subsidies available to farmers. However, farming has since been deregulated with the sector now more or less expected to respond to free market conditions. The producers make independent decisions based on where to purchase or sell the farm products. In fact, farmers are increasingly using the South African Futures Exchange to exchange futures contracts and hedge prices for their products, a pointer to a mature economy. Opportunities in the agricultural sector The sector presents opportunities both in primary production, processing and service areas such as financial and insurance services among others. For instance, poultry subsector is one industry that exhibit great investment potential. As mentioned, despite the significant increase in poultry production, the country is still unable to meet the massive increase in demand for white meat, with the deficit met by imports. Even some most popular crops such as—wheat, yellow maize and sunflower—the local production alone is not enough to meet the processing capacity, a clear demonstration of the need for additional investment to boost the country’s export capacity.[12] Financial institutions could also tap into this expanding sector providing finance to smallholders as well as financial advisory services to the established farmers seeking black economic empowerment (BEE) partners. Currently, the six major sources of credit to farmers include: banks (56%), the Land Bank (30%), agricultural cooperatives and agribusinesses (9%), private creditors account for 3% and other creditors and financial institutions for the remaining 2% credit sources.[13] [1] "South Africa". S.A Info, 2016: Weather and climate. Retrieved Apr. 15, 2016 via http://bit.ly/1NsfxPw. [2] "South Africa". World Bank, 2015. Retrieved Apr. 21, 2016 via http://bit.ly/1UCeZyp. [3] "South Africa". World Bank, 2015. Retrieved Apr. 21, 2016 via http://bit.ly/1Xzmynr. [4] "South Africa". Stats SA: Agricultural Statistics. Retrieved Apr. 21, 2016 via http://bit.ly/1VuoW1s. [5] "South Africa". CIA, 2016. Retrieved Apr. 15, 2016 via http://1.usa.gov/1myh9t2. [6] "South Africa". WWF: Agriculture Facts and Trends. Retrieved Apr. 15, 2016 via http://bit.ly/1imEVt9. [7] "South Africa". USDA, 2015: Corn Production by Country. Retrieved Apr. 21, 2016 via http://1.usa.gov/1alf521. [8] "South Africa". S.A Info, 2016: SA Sugar Association. Retrieved Apr. 26, 2016 via http://bit.ly/1MYTAND. [9] "South Africa". S.A Info, 2016: Weather and climate. Retrieved Apr. 25, 2016 via http://bit.ly/1NsfxPw. [10] "South Africa". WWF: Agriculture Facts and Trends. Retrieved Apr. 15, 2016 via http://bit.ly/1imEVt9. [11] "South Africa". PLAAS, 2013: The Distribution of Land. Retrieved Apr. 15, 2016 via http://bit.ly/22TlVGT. [12] "South Africa". DAFF, 2012: The Status of the Agro-processing Industry in SA. Retrieved Apr. 26, 2016 via http://bit.ly/236kKUy. [13] "South Africa". SA Government, 2015: Agriculture Sector. Retrieved Apr. 26, 2016 via http://bit.ly/1Tw5TQt.
The African continent is often considered as a place of great opportunities for mining resources. But, figures show a different reality: the African continent accounts for 5.5% of the world total production in 2011[1], behind Asia (58.2%), Northern Americas (14.5%), Europe (9.9%) and Southern Americas (7.0%) and close to Australia (4.9%). This apparent contradiction is explained by the fact that, despite the relative small weight of Africa in the World mining production, Africa is the leading region of production for specific minerals, often highly valuated. (more…)
According to fDi Magazine (a division of The Financial Times), South Africa has been crowned as the African country of the future for 2013/2014, with Morocco in second position and Mauritius in third. This ranking takes into account 6 key indicators with data gathered from 55 countries: Economic potential, Labour environment, Cost-effectiveness, Infrastructure, Business friendliness and FDI (Foreign direct investment) strategy. (more…)