Pulse #42 - On the brink: Mozambique’s $120bn crisis, DRC measles resurgence, TikTok paying African artists, victory for African languages
In this week's Pulse...
Economic and humanitarian costs of violence in Mozambique, refugees in Kenya face uncertain future as camp closures loom, TikTok royalties to secure loyalty of African artists, DRC measles resurgence threatens regional health, potential spoils for Africa in US-Russia energy power play, blockchain's potential for intra-Africa trade, decolonising the African mind using native languages, and more
The Data Room
Remittances to sub-Saharan (SSA) are one of the largest and most stable sources of external financing, rivalling official direct aid (ODA) for the top spot. At $48bn in 2019, remittance flows to SSA are now considerably higher than financing from other sources such as foreign direct investment (FDI), and debt & equity flows. So vital are remittances that they account for more than 10% of the GDP in South Sudan (34.4%), Lesotho (20.1%), Gambia (15.6%), Cape Verde (11.9%), Comoros (11.4%) and Senegal (10.7%). However in absolute terms, Nigeria receives more than half of all remittances to SSA.
Numbers in the Spotlight
(USD120bn) worth of gas projects disrupted by violence in Mozambique
(USD400mn) intra-Africa trade finance transaction executed using blockchain
(USD1mn) promised by The Weeknd for Tigray, Ethiopia humanitarian crisis
in Kakumba and Dadaab camps will not be moved for 30 days, as granted by Kenyan court
across Africa to benefit from new TikTok agreement to pay royalties to artists
of a book written in an indigenous African language to be nominated for the International Booker prize - Ngũgĩ wa Thiong’o
On The Continent This Week
Effective internal and regional security, and foreign policy
The cost of violence in Mozambique. Energy Giant Total is withdrawing its staff and suspending a $20bn gas project in northern Mozambique following last week’s jihadist attack in the area. Fighting involving militants linked to the Islamic State (IS) group has left more than 2,600 people dead and 760,000 displaced, jeopardising up to $120bn of natural gas projects - Africa’s largest-ever private investment. At the end of March, IS claimed responsibility for what has been described as the deadliest attack since the violence began in 2017, forcing hundreds of foreign contractors to flee. As the situation continues to deteriorate, leaders of the Southern African Development Community (SADC) leaders in Southern Africa have agreed to meet to consider a regional response to the violence. Until the fighting ends, Mozambique is likely to continue facing not only humanitarian, but also huge economic consequences.
Exporting culture & identity
TikTok will pay African artists.TikTok will start paying songwriters, composers, and music publishers on the Continent. The short-form video-sharing platform has announced a multi-year licensing agreement covering 58 territories across Africa, that will ensure artists are paid royalties when their music is used on TikTok, calculated according to market share and usage of their songs. African tracks are already proving popular on the platform - e.g. videos tagged #Amapiano received 181mn views last year. With over 25 music-streaming platforms in Africa, including Apple Music, Spotify, YouTube Music, Mdundo and Boomplay, the move will help position Tiktok as the platform of choice for African artists. By 2025, Africa’s music streaming revenues are expected to grow by 16.11% annually, pushing the market volume to $493mn.
Proportional representation in politics, business and community leadership
International Booker nomination a victory for African languages. Kenya’s Ngũgĩ wa Thiong’o has become the first writer of a book written in an indigenous African language to be nominated for the International Booker prize, proving that an authentic African story first written in a local language, can achieve success on the global stage. Thiong’o is nominated as writer and translator of The Perfect Nine, a novel-in-verse described by the judges as “a magisterial and poetic tale about women’s place in a society of gods”, and written in his native Gikuyu. Thiong’o is known for his 1986 Decolonising the Mind, in which he examines how the colonial classroom is a tool of psychological conquest in Africa, narrating how his classmates were often beaten for speaking their mother tongues - a trend that continues today. Can the recognition of Thiong’o’s work spark a renaissance in the use of local language in schools, literature, and beyond?
Baseline healthcare & disease protection
Urgency needed to prevent measles resurgence in DRC. As multiple public health players across Africa focus on rolling out Covid-19 vaccines, measles is making a resurgence in DRC. Measles - which is the most contagious disease in the world (nearly 10 times more than Covid-19) - has infected more than 13,000 children in DRC since January 1, just 8 months after authorities declared an end to the worst known outbreak in the country’s history. Although still one of the leading causes of death among young children, measles is often overlooked, with donor funding and manpower often mobilised to contain more high-profile diseases such as Ebola or Covid-19. To avoid the spread to neighbouring countries, players ought to commit some resources to contain the disease.
Home-grown digital infrastructure & platforms
Should Africa leap to 5G? Kenyan telecom operator Safaricom is rolling out a 5G wireless network, expanding the Continent’s coverage of the technology that is expected to fuel transformative new technologies - not just for consumers but also for businesses, infrastructure and defence applications. Kenya has become the second country in sub-Saharan Africa (SSA) to adopt 5G, after South Africa. Next-generation 5G networks can be 100 times faster than 4G, have greater bandwidth, and reduce latency to virtually zero - thus driving cost efficiencies and promoting economic growth. However, with significant unused 4G capacity, and 4G adoption still relatively low (9% in 2019), the focus for most operators and other stakeholders has been on increasing 4G uptake. With only 3% of Africans expected to be connected to the internet via 5G by 2025, the Continent is far from the stage of being able to reap the wide scale benefits of 5G.
High value skills development and talent repatriation
Can blockchain unlock the potential of intra-Africa trade? One of the largest intra-African trade finance transactions facilitated by blockchain has been executed between a Moroccan fertiliser company and an Ethiopian buyer. The transaction worth $400mn may provide a case study for how blockchain can unlock the untapped potential of intra-continental trade. The continental free trade area, AfCFTA, launched this year to bring together a market of 1.3bn people in a $3.4trn economic bloc. However progress has been slow due to, among others, lengthy cross-border transactions and supply chain disruptions. Blockchain enables trades to take place in under two hours, compared to over three weeks through the traditional banking system. Parties to the transactions can also simultaneously view, edit and validate documentation-improving transparency and traceability. Can adopting blockchain be a viable option for accelerating the implementation of AfCFTA?
End-to-end value chain capture
How cold chains can increase food security. Two leading players in the cold chain logistics industry have signed a partnership, expected to significantly reduce postharvest losses (PHL) in Africa. Under the partnership, cold hubs in large facilities such as airports, maritime ports, and industrial zones, will be linked to relatively smaller on-farm cooling technologies. This will ensure that farm harvests are promptly stored in on-farm cold chains before being transported to larger cooling facilities for further distribution. The value of PHL in SSA is estimated at $4bn annually. Over 40% of food produce in Africa spoils before it reaches the consumer; that figure surges to 60% for fresh produce, due to lack of cold chain solutions near farm. As such supply chain efficiencies achieved via cold chains can reduce food loss, increase income generation from farming and agri-industry, improve product quality and safety, and contribute to food and nutritional security.
Essential infrastructure, personal living-space & utilities
What options do refugees have as closure of Kenyan camps looms?Kenya’s high court has blocked the imminent closure of the Dadaab and Kakuma refugee camps - but only for 30 days. On March 24, Nairobi gave the UNHCR two weeks to shut the camps over alleged infiltration by terrorists. However some speculate the decision is a play by Kenya to “extort bribes from the international community”. The refugees have limited options - including self-settlement within Kenya, voluntary repatriation back home, seeking asylum in a third country, or waiting to be relocated to the border with Somalia. Until a plan is unveiled by the UNHCR, the fate of 410,000 people remains uncertain. Concerns are mounting that lack of security and opportunities for these refugees can only lead to increased instability, wherever they may land.
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