Speaker 1: The money shows the Africa Business Report, doctor Rotundo and
Speaker 1: doing he's founding director of Tribe Africa Advisory and author
Speaker 1: of Rumble in the Jungle reloaded a Rotundo. Good to
Speaker 1: see you. How's it very well, Stephen? So I don't know,
Speaker 1: how do you say this? Perhaps PAPSS. This is the
Speaker 1: payment initiative. It's expanding to a lot more countries.
Speaker 2: It is. And this is spearheaded by the Africans and banks, Stephen,
Speaker 2: and the African Payment Settlement System. So I've educated you.
Speaker 2: There's something, Stephen, when you always educate me. And the
Speaker 2: reason why there's a bit of a hype now and
Speaker 2: this was announced that the recent on the news headlines
Speaker 2: is that fifteen financial institutions and fourteen national switches are
Speaker 2: now connected. So it's a milestone achievement. Why is this
Speaker 2: important because it's a key component of the IFCFTA with
Speaker 2: regards to the free movement of goods and people. Why
Speaker 2: is that such a big thing Because at the end
Speaker 2: of the day, if people and goods are moving across
Speaker 2: the country freely, across the continent freely, then there has
Speaker 2: to be a free move of money. And that's why
Speaker 2: it plays a key role. Just to give you some stats, Stephen,
Speaker 2: as of twenty twenty three, two BILLIONOIS dollars went through
Speaker 2: that system. The cumulative figure since it opened up in
Speaker 2: twenty twenty two or sixty eight billion NEUIS dollars. And
Speaker 2: the vision of PABs in terms of the coming years
Speaker 2: is that they want to expand or in this year
Speaker 2: twenty twenty five, they want to expand to thirty countries
Speaker 2: on the continent. And there's a key focus in terms
Speaker 2: of leveraging of AI, and one of the carriers that
Speaker 2: focusing is in the agrisector because agriculture plays a key
Speaker 2: role in the content. But another key component as well
Speaker 2: is that with anti money laundering. You know, Africa has
Speaker 2: always been sort of a had a big loop all there,
Speaker 2: and they're using AI through this application in order of
Speaker 2: managing that. So but a key milestone in terms of
Speaker 2: AFCFT and leveraging of a payment system that can integrate
Speaker 2: the continents even.
Speaker 1: I mean, it's fascinating to watch payment systems change and
Speaker 1: evolve and more and more. We've had out issues with
Speaker 1: the gray Less and the Financial Action Task Force and
Speaker 1: all the rest, but you've got to manage them very
Speaker 1: very carefully, people get quite a little more. It sounds simple,
Speaker 1: we should alway use the same payment system. Actually it's
Speaker 1: incredibly complicated.
Speaker 2: Now it is, and just to give you how complicated
Speaker 2: it is, perhaps at the moment, I think they're probably
Speaker 2: linking about. And these are individual accounts, banking accounts, five
Speaker 2: hundred million bank accounts within its system. So obviously it's
Speaker 2: from small startups to big corporates and it goes on
Speaker 2: and on. But the idea is that you've got a
Speaker 2: lot of money integrated to a lot of countries, interacting
Speaker 2: with a lot of multifaceted scenarios SOT. At the end
Speaker 2: of the day, if there's similess interaction and engagement from
Speaker 2: a financial perspective, that's all great. But the end of
Speaker 2: the day, it has to stimulate the economy. It has
Speaker 2: to stimulate trade and the free movement of people and goods.
Speaker 2: So it's something to continue watching. But a key milestone
Speaker 2: and Africian Bank has to be uplauded, and I think
Speaker 2: the president or Professor Benedict to step down from the
Speaker 2: leadership and with the new leader coming on board, I
Speaker 2: think a legacy he has left something quite significant as
Speaker 2: one of his achievements.
Speaker 1: Ethiopian investment Holdings. They've signed a deal with the US
Speaker 1: Private Equity fun They're going to build a five star
Speaker 1: hotel in Addis.
Speaker 2: A five star hotel in Addis Ababa. So why is
Speaker 2: this important? I mean, Ethiopia has been making a lot
Speaker 2: of key non economic initiatives just in terms of developing
Speaker 2: the economy. They've partnered up with the US. They've recently
Speaker 2: announced this is the big US Africa conference that happened
Speaker 2: in Angola. I think the cost of the investment is
Speaker 2: estimated about about two hundred and fifty million US dollars.
Speaker 2: That's quite significant. Why is that important? They've actually started
Speaker 2: trading on FCFT today, so one July, and that's a
Speaker 2: big another big mouthstone. Remember last year, Stephen, we talked
Speaker 2: about how they'd liberalized the economy by floating the currency
Speaker 2: they'd often also listed. I think earlier this year their
Speaker 2: first stock exchange over. They've reopened their stock exchange.
Speaker 1: I can't have a stock exchange for a five star hotel.
Speaker 1: I mean we all know this.
Speaker 2: So if you traveled to Ethiopia, you need to stay
Speaker 2: somewhere good. And but another thing also the airport that
Speaker 2: they've expanded. Remember that's also looking at processing one hundred
Speaker 2: million passengers. That's more than the population of South Africa.
Speaker 2: So all of these things they've attracted investors and the
Speaker 2: one to create obviously good lending ground for investors and
Speaker 2: investors coming onto the country. So two hundred and fifty
Speaker 2: million US dollars have gone into hotel. The Ethiopian investment
Speaker 2: holding the AH is the one driving the initiative and
Speaker 2: it's quite a significant thing. So quite excited about that
Speaker 2: and looking and I think Ethopia has got its challenges,
Speaker 2: but they're definitely making key initiatives from an economic reform
Speaker 2: perspective that will stimulate the economy take it to the
Speaker 2: next level.
Speaker 1: And then malaria obviously a major major issue for us
Speaker 1: and there's quite a lot more technology around this now.
Speaker 2: So just six hundred thousand people every year die in
Speaker 2: Africa because of malaria, so it's still taking its toll.
Speaker 2: And I think the impact on GDP steven is estimated
Speaker 2: to be sixteen billion US dollars in total in Africa.
Speaker 2: So you know, you'd have thought by now in terms
Speaker 2: of technology, in terms of investment in the medical space,
Speaker 2: that would have overcome the challenges of malaria, but was
Speaker 2: still far behind. There's a Japanese company called Sora Technology,
Speaker 2: and these are private investors, and they've used AI technology
Speaker 2: using drones that specifically go and detect mosquito breeding and
Speaker 2: apply and apply love resides, which are the insecticide to
Speaker 2: kill mosquitoes. And they've I think they've invested in Nigeria,
Speaker 2: they're looking going to Ghana and the rest of Africa.
Speaker 2: They've recently received another and these are the Japanese investors.
Speaker 2: They've injected another four point eight million US dollars in
Speaker 2: this initiative. The outcome of this obviously results in a
Speaker 2: seventy percent reduction in insecticize, a forty percent savings in
Speaker 2: prevention costs, and a fifty percent decrease in labor costs.
Speaker 2: At the end of the day, for Africa to be
Speaker 2: a healthy economist even or to be productive, for us
Speaker 2: to go to the next level where there's industrialization, you
Speaker 2: need a healthy workforce and malaria is one of the
Speaker 2: unfortunately those things that hold us back amongst other challenges.
Speaker 2: So this is a positive investment. I think the I
Speaker 2: think when I was looking at this article and reading
Speaker 2: it's even I think my frustration as where where the
Speaker 2: African investors. It's an African problem, but I think we
Speaker 2: should have more of African investors leading the charge. And
Speaker 2: in this case, these are private investors from Japan. From Japan,
Speaker 2: we're actually making this investment and they're seeing the return
Speaker 2: on investment. And the big question is where the African
Speaker 2: investors with regards to providing these homegrown solutions. So at
Speaker 2: the end of the day, we benefit as a continent.
Speaker 2: But still there's that gap of that query in terms
Speaker 2: of why African investors not investing in homegrown solutions.
Speaker 1: It's very it's very very interesting in Gambia. There's a
Speaker 1: farm fish in Europe likes farm fish big time. What
Speaker 1: impact is that happening on people in the Gambia.
Speaker 2: So the Gambia it's a very small country, Steven. You
Speaker 2: know when I when when you look at the GDP.
Speaker 1: That very interesting leader for a long time.
Speaker 2: Yeah, I didn't have to walk around a lot in
Speaker 2: terms of this country. I mean, Gamba is almost like
Speaker 2: I think it's the Lusuto Swail. It's a strip within Senegal.
Speaker 1: You know the colonial history of it that was so
Speaker 1: the idea was that a British this is the sort
Speaker 1: of colonial legend, right, So I mean don't take it.
Speaker 2: So history is history.
Speaker 1: Yeah, So the story was that a British warship went
Speaker 1: up a river and then fired shells in four different
Speaker 1: directions and where they landed with the borders of Gambit.
Speaker 2: Very possible.
Speaker 1: Yeah, that's the story.
Speaker 2: It's very possible. The gdpist even is two point three billion,
Speaker 2: the population is two point three million, so it's almost
Speaker 2: a GDP capital of one thousand dollars per person, which
Speaker 2: is which is actually fascinating. But anyway, coming back to reality,
Speaker 2: one of the big challenges that they have is that
Speaker 2: they've got a lot of European industrialized fishing businesses taking
Speaker 2: out fish from there from their shores, namely the I'm
Speaker 2: trying to remember the Bonga fish and the sardines. And
Speaker 2: what is the IMPACT's making is obviously, as a small economy,
Speaker 2: it relies a lot of fish as a subsidy for
Speaker 2: its people and its businesses. The estimated loss that they
Speaker 2: are making not just Gambia, but if you bring all
Speaker 2: the surrounding countries of Mauritania, Senegal, Guinea Bissau as well
Speaker 2: as say early on, they're losing about two point three
Speaker 2: billion US dollars. So it's quite significant for an economy
Speaker 2: like those in terms of the challenges that are there.
Speaker 2: So I think the big thing is now now they're
Speaker 2: fighting with the EU, trying to take back the rights
Speaker 2: with regards to those that they're given to the EU.
Speaker 2: And obviously that in itself is a complicatedness, especially when
Speaker 2: you're not a big economic powerhouse and you want to
Speaker 2: fit fight the big guys again. And I think it
Speaker 2: just highlights again is that the challenge that is always
Speaker 2: there for Africa was seeing with the d C with
Speaker 2: the US, when you structure these deals where you want
Speaker 2: to benefit economically, but it's the expense of the local people,
Speaker 2: there's always a balancing actor. I think that's where Gambia
Speaker 2: finds itself in terms of trying to sustain its economy
Speaker 2: and its people and something to continue watching.
Speaker 1: I mean Saudia rate is lending thirty eight million dollars
Speaker 1: to Tenisia.
Speaker 2: Thirty eight million US dollars, and you know, the when
Speaker 2: you look at the history of Saudi and Tunisia, it
Speaker 2: goes back apparently about seventy five years, and over seventy
Speaker 2: five years, Stephen, they've given Tunisia has received from Saudi
Speaker 2: through the Saudi Development Fund about one point two billion
Speaker 2: US dollars in sessional loans and grants to the point
Speaker 2: of one hundred and five million US dollars, and this
Speaker 2: is Saudi investing in Tunisia. And in this specific investment,
Speaker 2: the thirty eight million is targeted specifically towards the Oasis project,
Speaker 2: which is forecused in terms of one thousand hectares of
Speaker 2: agri land that has been refurbished and being developed. There's
Speaker 2: also to equip about twenty two wells in terms of
Speaker 2: digging and producing water and deliver about twenty and eighty
Speaker 2: five thousand units. So it's quite a positive story. I
Speaker 2: think the sad thing is that at the end of
Speaker 2: the day, Saudi is still battling in terms of debt.
Speaker 2: Their public debt is about fifty million US dollars. And
Speaker 2: the last thing, also Steven, is that they're the fourth
Speaker 2: highest Arab in the Arab world in terms of debt.
Speaker 2: I think there are dead sevens that are about three
Speaker 2: point eight billion US dollars and their third after fourth
Speaker 2: after Egypt, Lebanon and Jordan. So great the investment is
Speaker 2: coming in, but as an economy there's still a lot
Speaker 2: of reforms and things that they have to do to
Speaker 2: change direction and move in the right direction.
Speaker 1: Doctor Rutendo and Dowinki, thanks so much for coming and
Speaker 1: really appreciated. The founding director of Tribe Africa Advisory also
Speaker 1: author of the book Rumble in the Jungle. Reloaded