Daily Archives: October 19, 2018

SOUTH AFRICA TO SHOWCASE INVESTMENT OPPORTUNITIES

PRETORIA– Next week’s much-anticipated Investment Conference will be a platform for South Africa to woo investors and showcase a more coherent narrative about the direction of South Africa’s economy.

This is according to Economic Development Minister Ebrahim Patel who on Thursday addressed the media on preparations to host the country’s first Investment Conference.

Themed ‘Accelerating Growth by Building Partnerships’, the conference will be held on Oct 25-27 at the Sandton Convention Centre. The Investment Conference follows a commitment made by President Cyril Ramaphosa during the State of the Nation Address in February this year.

Patel said the aim of the conference is to market the compelling opportunities in the country so as to encourage investments and create jobs.

Government would engage potential investors on “where we want the economy to go, where the opportunities are, how we are going to increase the rate of growth and how this would impact growth in the continent”.

“Government will use the opportunity to engage with investors and share the progress it is making in its journey towards political and economic recovery. This requires strengthening the credibility of our public institutions and unlocking the latent potential and innovative spirit of South Africa’s economy.”

The conference is also an opportunity to take further the many discussions and issues that came up during the Jobs Summit, FOCAC and BRICS Summit and now talk to people with resources who can invest in South Africa, Patel said.

South Africa was going for “a more coherent storyline instead of doing one thing and waiting an entire year to do another”.

President Ramaphosa is expected to open the conference on Friday. This will be followed by the announcement of bankable projects and then the plenary will break into sector-specific sessions.

Sessions will bring together both foreign and local investors the respective ministers to work out what can be done practically to boost investment.

About 50 investment experts are expected to attend and lead discussions.

While the summit will focus on the economy as a whole, delegates will drill down to key areas where there is a scope for growth. The President is also expected to meet and brief a number of Chief Executive Officers.

On Friday, investment announcements will be made. “Companies will take to the podium to indicate what they are committing to invest or they’ll sign Memoranda of Understanding when the investment commitments would be realised,” he said.

Patel said the conference is a key milestone in the country’s bold ambition to raise at least R1.2 trillion in new investment over the next five years. It is one in a series of initiatives being undertaken by government to ensure economic recovery and growth, and to create jobs and prevent further job losses.

In April this year, President Ramaphosa appointed four investment envoys, namely, former Minister of Finance, Trevor Manuel; the former Deputy Minister of Finance Mcebisi Jonas; businesswoman Phumzile Langeni and veteran businessman Jaco Maree.

Source: NAM NEWS NETWORK

SOUTH AFRICA CONTINUES TO BE AFRICA’S INVESTOR DESTINATION

PRETORIA– South Africa’s strong financial market infrastructure and robust legal framework has ensured the country remains the ultimate destination for investors in Africa, according to the Absa Africa Financial Markets Index.

The Index, produced by the Official Monetary and Financial Institutions Forum (OMFIF), provides a toolkit for countries seeking to strengthen their financial markets infrastructure.

It assesses countries according to six pillars: market depth; access to foreign exchange; tax and regulatory environment and market transparency; capacity of local investors; macroeconomic opportunity; and enforceability of financial contracts, collateral positions and insolvency frameworks.

According to the report, South Africa continues to lead the index supported by strong financial market infrastructure and a robust legal framework.

South Africa scored an impressive 93 out of 100. Its closest competitor, Botswana, lags behind with a score of 65.

However, the report noted its macroeconomic performance has worsened.

“Additionally, it no longer tops the index across all six pillars, having been overtaken by Kenya on ‘access to foreign exchange’ and by Nigeria in ‘market transparency, tax and regulatory environment,” read the report.

South Africa’s open and highly liquid foreign exchange market has exposed it to capital outflows, “reflecting concerns about the country’s macroeconomic trajectory”.

According to the Index, of the surveyed countries South Africa is the only country where the total value of listed equities is more than $100 billion, at $1.1 trillion.

It also tracks progress on financial market developments annually across a range of countries and indicators. This year’s edition extends coverage to three additional countries – Angola, Cameroon and Senegal – and pays special attention to policies to enhance market growth, including financial inclusion and investor education, OMFIF said.

The Index evaluates financial market development in 20 countries, as well as highlighting economies with clearest growth prospects.

The aim is to show not just present positions but also how economies can improve market frameworks to meet yardsticks for investor access and sustainable growth.

Source: NAM NEWS NETWORK

Trump Administration Rethinks Foreign Aid With Eye Toward China

A gleaming new $3.2 billion railway cuts in half the travel time from Kenya’s capital, Nairobi, to the coast. Major investments in transportation, energy and maritime infrastructure are turning Pakistan into a major economic corridor. A new industrial zone in Thailand boasts solar, rubber and industrial manufacturing plants and is slated to host 500 companies by 2021.
All are parts of China’s ambitious Belt and Road Initiative, featuring billions of dollars in infrastructure investment across Asia, Africa and the Pacific. The global impact is forcing the administration of U.S. President Donald Trump to rethink elements of its plan to cut back on foreign assistance under an “America First” strategy.
U.S. Secretary of State Mike Pompeo, interviewed Friday in Mexico City by VOA contributor Greta van Susteren, said Chinese foreign investment will not overwhelm the U.S.
“We don’t have any problem with Chinese commercial investment. That’s their right to go compete in the world,” he said. “I’m convinced that if we compete with them all over the world we’ll do incredibly well.”
When “very senior people” in the administration traveled abroad and “saw that China was eating our lunch, they thought to themselves, ‘We have to do something,’ ” said Daniel Runde, an analyst with the Center for Strategic and International Studies (CSIS) in Washington.
And in a number of quiet moves affecting private investment, humanitarian aid and women’s empowerment abroad, the administration and the U.S. Congress have been doing just that.
Major policy reversal
In what is being seen as a major policy reversal, Trump this month signed the so-called BUILD Act, described by the nonpartisan CSIS as “the most important piece of U.S. soft power legislation in more than a decade.”
The new law merges and boosts agencies and programs that had once been targeted for deep budget cuts, creating a new entity tasked with providing loans, political-risk insurance and equity stakes to U.S. firms investing in developing countries, from Afghanistan to Zambia.
The agency will be known as the U.S. International Development Finance Corp., or USIDFC, and have a $60 billion budget. It will absorb the existing Overseas Private Investment Corp. (OPIC) and more than double that agency’s current budget of $29 billion.
The USIDFC is “a much-needed instrument of commercial diplomacy that the U.S. has been sorely lacking,” said Witney Schneidman, a former deputy assistant secretary of state for African affairs, in a recent blog post for the Brookings Institution.
In a follow-up phone interview, Schneidman said he thought the new agency would help “get U.S. companies interested in Africa on its own merit. … It does put the U.S. on level with the Chinese” by matching Beijing’s policy of making equity investments in companies seeking to do business overseas.
Dwarfed by China
Even at $60 billion, the new U.S. program will be dwarfed by Chinese investments in Asia and Africa. But Brookings analyst George Ingram said its impact can be magnified by partnering with other international lending organizations.
“The French, the British, the Scandinavians – they all have similar organizations,” Ingram said. “And now that the [USIDFC] has equity authority, this new entity will be able to be a much more effective partner than OPIC could be.”
The BUILD Act has its critics, especially among free-market conservatives who believe the government should not get involved in private business decisions.
“The idea of equity participation was kind of sold politically that it was going to be the U.S. responding to China’s One Belt, One Road [initiative] and yet there was no mention of China in the legislation at all,” James M. Roberts, an editor for the Washington-based Heritage Foundation’s annual “Index of Economic Freedom,” told VOA in an interview.
By ensuring equity stakes, “that means the government is going to be a shareholder in foreign companies,” added Roberts, who has listed a potential for “cronyism and misallocation of capital” among his concerns.
Advocates of the plan include Mark Green, head of the U.S. Agency for International Development, whose Development Credit Authority is being folded into the USIDFC. By encouraging U.S. private investment abroad, he has said, the new enterprise will “spur economic growth in less developed countries and advance the foreign policy interests of the United States.”
Interviewed last week for VOA’s “Plugged In With Greta Van Susteren,” Green, a former Republican congressman who later served as ambassador to Tanzania, said there’s a “fundamental difference” between U.S. and Chinese approaches to development abroad.
China favors loans that can include “unsustainable financing that mortgages a country’s future,” he said. In contrast, USAID expects recipients to implement reforms.
“We ask them to respect certain rights and values. What we want for them is to become eventual trading partners, but equal partners,” Green added.
Other measures
The Trump administration has demonstrated a renewed openness to international aid in other ways as well, including a recent five-year extension to an anti-hunger measure known as the Global Food Security Act. It supports USAID programs such as the Feed the Future initiative, which partners with governments, NGOs, private enterprise and others “to strengthen agricultural markets and then entire food systems,” said Beth Dunford, who oversees the initiative.
Pending in Congress, meanwhile, is the Women’s Entrepreneurship and Economic Empowerment Act, aimed at improving women’s access “to economic participation and opportunity.”
It calls for supporting women’s property and inheritance rights and ending gender-based violence. It also requires that USAID integrate efforts to empower women in all of its programs, and it broadens support for women-run small- and medium-size businesses.
The bill, which enjoys bipartisan backing, is being promoted by first daughter Ivanka Trump. She tweeted her thanks this week to four U.S. senators for advancing the bill.
“Women’s economic empowerment doesn’t always get a lot of attention in Congress, so this bill is something we’re quite excited about,” said Nicole Ellis, who manages policy communications for the international relief agency CARE.
Gayatri Patel, CARE’s senior policy advocate, said the agency is working closely with legislators, noting they want “practical recommendations and approaches.”
That might include endorsing approaches such as the CARE Village Savings and Loan Association program that CARE started in Niger in 1991.
“You get women in a community to save, they give each other loans,” Patel said. “It’s really an entry point for women for more formal economic endeavors … to start businesses or pay for their children’s education, to connect with the market and mentor or be mentored by others in the community.”
The goal, she said, is to encourage aid that has “a catalytic effect on women, their families and their communities.”

Source: Voice of America

Sudanese Official: We Are Not Sponsoring Terrorists

The U.S. should consider removing Sudan from its list of states sponsoring terrorism, a senior Sudanese diplomat in Washington told VOA, citing the country’s efforts against terror groups on its soil.
Waleed Basheer, the deputy chief of mission at the Sudanese Embassy in Washington, welcomed the recent annual U.S. report on terrorism, but voiced concern over Sudan’s inclusion on the list.
“The U.S. report confirmed that Sudan is not sponsoring terrorism. Nevertheless, the United States continues to designate Sudan as a state sponsor of terrorism,” Basheer told VOA. “This is kind of contradicting; it is simply unjust and unfair.”
U.S. report
The annual U.S. report on terrorism — featuring a breakout by country — was released last month. It acknowledges Sudan’s cooperation in combating terrorism in the region in 2017.
“The Government of Sudan continued to pursue counterterrorism operations alongside regional partners, including operations to counter threats to U.S. interests and personnel in Sudan. Sudan’s de-radicalization program focused on reintegration and rehabilitation of returned foreign terrorist fighters and those espousing terrorist ideologies,” the report said.
However, U.S. officials insist the nation should continue to build upon its positive actions.
“Sudan continues to be designated a state sponsor of terrorism. If we conclude that Sudan has sufficiently built upon the positive actions it has taken, including by improving respect for human rights, enhancing humanitarian access, and advancing Sudan’s peace process, and determine that the relevant statutory criteria have been met, we would consider beginning the process to rescind Sudan’s State Sponsor of Terrorism designation,” a U.S. State Department official told VOA.
But some analysts, such as Kelsey Lilley, who was a coordinator for the Atlantic Council’s Sudan Task Force, contend there is a disconnect between the language in the U.S. report and the U.S. policy regarding Sudan.
“There is clearly a disconnect between the moderated, but positive, language of the State Department report on terrorism … and its continued inclusion on the State Sponsors of Terrorism list,” Lilley said.
“Sudan is alongside Syria and Iran, as well as North Korea. It is hard to reconcile those states’ support for terrorist activities with what we know, at least openly, about Sudan,” she added.
Positive measures
Sudanese officials assert they have increased regional collaboration in countering terrorism and violent extremism.
“Sudan joint forces with neighboring countries to protect the borders are very effective and resulted in the decline of both ISIS and al-Qaida’s terrorist activities in the region,” Basheer said, using an acronym for Islamic State.
He added that the country also has taken measures against money laundering and transnational crimes.
“We are controlling and monitoring the movement of passengers with a heavy patrol at the borders. We are combating transnational crimes, combating money laundering, human trafficking, illegal immigration and drug trafficking,” he said.
Sanctions history
Sudan was designated a state sponsoring terrorism by the Clinton administration in 1993. The country also was hit with U.S. sanctions over Khartoum’s alleged support for multiple terror groups, including al-Qaida, Hamas and Hezbollah.
Osama bin Laden and his followers lived in Sudan between 1992 and 1996.
Last year, the Trump administration lifted sanctions on Sudan and withdrew the country’s name from the list of countries with travel restrictions. The hope, at least inside Sudan, was that the removal of sanctions would help revive the economy.
That has not happened. Sudan’s economy remains in crisis due to surging inflation, a high foreign debt and the loss of oil revenue due to the secession of South Sudan in 2011.
But some analysts, like Omer Ismail, a senior policy adviser at Enough Project, a Washington-based think tank that studies conflicts in Africa, says the Sudanese government is responsible for the economy.
“The regime is built on corruption and managed to steal the country’s resources. Businesses through government contracts managed to transfer money out of Sudan. That is why the economy suffered multiple times and became worse even than before the economic sanctions were lifted,” Ismail said.
However, David Hoile, director of the London-based Africa Research Center, blames Sudan’s terror designation for its economic hardships.
“Because Sudan is on the list, the American government is legally obliged to oppose any bank loans, any credits, any instruction from the IMF or World Bank, or any financial institution, with which the American government is involved,” Hoile said.
“This is a huge obstacle to any economy,” he added.
Maintaining leverage?
Some experts say keeping the country on the list is important because it gives the U.S. leverage over Sudan.
“Their [Sudan’s] behavior continues to be appalling. This behavior needs to be condemned,” Eric Reeves, a professor at Smith College in Massachusetts and an expert on Sudan, told VOA.
“As recently as 2013 the regime was supporting radical Islamists in Libya, probably until 2014. That will be one example of radical Islam being supported by the Khartoum regime. As long as they are on the list, they are going to want to do more,” Reeves added.
Removing the country from the list would take away that leverage, according to Ismail.
“I believe that removing Sudan from the terrorist list is going to take away a huge advantage from the U.S. to use to pressure the Sudanese government to make changes,” Ismail said.
Hoile of the Africa Research Center believes that with changes in Washington, the prospect for the country’s removal looks promising.
“With [U.S. President Donald] Trump, you have a man who is independent, who is not wedded to pre-existing dogma. He is not wedded to the old song on Sudan,” Hoile said.
“Sudan may come off the list in the next [few] months,” he added.
“The removal process mandates that the U.S. intelligence community conducts a months-long review about whether the Sudanese government is supporting terrorism,” Lilley said, adding that even if the administration supports it, Congress has 45 days to block the move.

Source: Voice of America