News type: Africa Bulletin

Across the world, the obstacles to data privacy have evolved faster than the regulatory and legal structures meant to protect that right. Many businesses in Africa have been victims of data breaches, resulting in significant financial losses and reputational damage. By implementing data protection laws, businesses can take proactive measures to prevent data breaches and ensure they are adequately protected from cyber threats and other data acquisition breaches.

The Data Protection regulation is crucial for business entities as it requires them to assess the impact of personal data processing to promote data transparency and avoid data breaches, leaks and theft of intellectual property. – Jean Eric – Sauzier, Partner, ALN Mauritius

Africa
Two African Banks Stake USD 16 Billion in Oil, Gas Projects
About USD 16 billion is being invested in oil and gas projects across Africa by the African Export-Import Bank (Afreximbank) and the African Finance Corporation (AFC). This was recently disclosed at the Cape Town, South Africa African Refiners and Distribution Association (ARDA) conference. This is coming as stakeholders at the conference urged Africans to keep funds within the continent to finance the over USD 190 billion yearly energy investment needed. Of the banks’ investment, USD 15 billion of the funds is invested by Afreximbank. AFC has already invested over USD 800 million, with an additional over USD 200 million expected to be finalised. Global Head, Client Relations at Afreximbank, Rene Awembeng, said the company’s oil and gas portfolio exceeds USD 15 billion with a healthy pipeline across the continent. Speaking on the sideline of the conference, he noted that the continent must focus on shared infrastructure and be ready to finance itself; otherwise, projected development may remain elusive. Awembeng stated that the continent is in a critical situation where demand for energy continues to rise on the backdrop of a surging population. With the continent relying mainly on the importation of petroleum products at a time when foreign exchange demand is hovering at USD 100 billion yearly and required energy investment annually stands at USD 190 billion, Awembeng said large infrastructure development, including refineries that would meet demand on the continent, must be prioritised and supported.

Source: The Guardian

The African mining industry is at a crossroads, facing both opportunities and challenges as it strives to sustainably meet the rapidly growing demands for mineral resources. The mining sector is critical to the continent’s economic development, providing employment and contributing significantly to the GDP of many African countries. According to Statista, Africa has abundant reserves of minerals and metals, including gold, diamond, cobalt, bauxite, iron ore, coal, and copper spread out throughout the continent. Africa continues to be a major producer of many important mineral commodities for the world.

According to the World Bank, the term “People-first Public-Private Partnerships (PPPs) for the Sustainable Development Goals” (now shortened to “PPPs for the SDGs”) was coined in 2015 alongside discussions around the Addis Agenda. After adopting this agenda, the United Nations’ Financing for Development Office convened a session that shaped the discussions on guidelines and documentation of PPPs. At first, PPPs were used for risk mitigation exercises for the private and public sectors. However, they have morphed into a broader concept of structuring agreements which can have significant development benefits which, include actualising the SDGs for developing countries.

Africa

Africa has USD 1.5 Trillion Green Hydrogen Economy Potential
A new study, titled Africa’s Extraordinary Green Hydrogen Potential, conducted by the European Investment Bank (EIB), International Solar Alliance and the African Union (AU), has revealed that Africa’s green hydrogen potential is approximately USD 1.5 trillion, and if maximised through to 2035, has the potential to position the continent as a global clean energy hub. Supported by the government of Mauritania, Europe’s HyDeal and Morocco’s UCLG Africa, the study has identified three green hydrogen hotspots, namely Mauritania and Morocco, Southern Africa and Egypt. The study stipulates that exploiting the continent’s solar energy potential by developing up to 1.2 gigawatts of new generation capacity in the three-specific hubs could enable the production of up to 50 million tonnes of green hydrogen per annum by 2035 at a globally competitive cost. This would help improve global energy resilience, the decarbonisation of heavy industries, the continent’s economic competitiveness and heightened GDP growth. Ambroise Fayolle, vice president of the EIB, stated, “Unlocking Africa’s green hydrogen potential will require close cooperation between public, private and financial partners.”

Source: Energy Capital & Power

In recent years, there has been a rise in global powers such as the US, China and the EU (European Union) seeking to strengthen economic, political and security relations in Africa. The US has traditionally used its foreign policy framework to determine the type of relations it will have with different countries across the globe. However, this has had to change as many African countries have shifted their focus East toward China. The recently concluded US-Africa Leaders Summit held in Washington D.C. will see Africa and the US reigniting relations. This summit also indicates that competition between these three major global powers will continue as we head into 2023 and beyond. According to Voice of America, the US has pledged USD 55 billion over the next three years, with trade, agriculture and infrastructure (digital, energy and physical infrastructure) getting the most attention. These three areas are critical for Africa’s growth and continue to take centre stage as global economic shocks such as the COVID-19 pandemic and the war in Ukraine contributed to slowed growth of these sectors. Below is a breakdown of the focus areas that the two continents made significant commitments.

Africa
Africa Seeks Bigger US Trade Slice for AGOA to Make Sense
African countries may need more trade privileges with the US even as Washington reviews the African Growth and Opportunity Act (AGOA) meant to expand what the continent will export. At the end of the US-Africa summit in December, Washington pledged to renew AGOA, bringing clarity to uncertainties that had befallen exporters from countries such as Kenya. But now experts say the narrow view of AGOA should be expanded to allow them to export more goods and hence benefit more countries that can make a diversified list of goods. “AGOA has to be expanded in two ways; expanded in its product coverage and in terms of country coverage,” said Melaku Desta, Coordinator of the African Trade Policy Centre, UN Economic Commission for Africa. “AGOA also excludes processed products as Africa is allowed to export Iron and ore but not steel products. So, it has to be expanded in terms of product coverage. It also has to be expanded in terms of country coverage.” The US Congress first passed AGOA’s legislation in 2000. It expires in 2025, having been extended four times before. Initially, it was meant to last until 2007 but was amended to clarify on preferential treatment of African goods and other standards required of goods.

Source: The EastAfrican

Technology has continued to push the boundaries of what is possible and achievable in our lifetime. In the past decade, technology has enabled Africa to innovate solutions to challenges such as food security, access to health, financial inclusion, and education. Digital technologies can help address the significant inequalities the continent faces, help manage climate change, increase food production, improve education, increase access to healthcare, and even democratise elections. All these benefits can significantly increase the living standards of people on the continent.

In 2023, Africa needs an economic turnaround after the COVID-19 pandemic disruptions and the war in Ukraine. These two events have caused global economic shocks, with Africa being among the most affected continents. However, where great challenges lie, great opportunities are presented. Many businesses are looking forward to major turnarounds, making their models more resilient to future shocks. Business can leverage numerous trends and opportunities to improve their best practices, which can be informed by gaps in their and related industries. These trends create a new and improved way of doing business and provide opportunities that help their growth.

Africa

AfDB Launches Model for Deploying Green Financing across Africa
The African Development Bank (AfDB) is encouraging the promotion of resilient, green and sustainable growth, with the launch of the African Green Bank Initiative, a model for deploying green financing across Africa. The initiative presented at COP27 in Egypt, will support the implementation of African countries’ Nationally Determined Contributions (NDCs). Part of the African Financial Alliance on Climate Change (AFAC), the African Green Finance Facility Fund (AG3F) will support the Green Bank Initiative. The AG3F will provide technical assistance to governments and financial institutions in creating and capitalising green facilities, co-invest alongside those in green projects and provide de-risking instruments to increase private sector mobilisation. Launching the initiative, AfDB vice president for Energy, Power, Climate and Green Growth, Kevin Kariuki, said the African Green Bank model would help increase the continent’s access to global climate finance. “The Green Bank Initiative is a powerful tool for reducing financing costs and mobilising private sector investments in climate action in Africa,” Kariuki said.

Source: AfDB