Category: Business

Role reversal as African technology expands in Europe

Africans have long used technology developed abroad, but now a Kenyan cash transfer network which bypasses banks is being adopted in Europe.

The M-Pesa mobile money transfer system which allows clients to send cash with their telephones has transformed how business is done in east Africa, and is now spreading to Romania.

“From east Africa to eastern Europe, that’s quite phenomenal when you think about it,” Michael Joseph, who heads Vodafone’s Mobile Money business, told AFP in the Kenyan capital Nairobi.

“I think that this is something the rest of the world can look at, to say that there are ideas that can emanate out of the developing world, and take it to the developed world.”

M-Pesa – or “mobile money” in east Africa’s Swahili language – was introduced in Kenya in 2007 by Safari.com, the country’s largest mobile telecommunications company, in partnership with British giant Vodafone.

(Pic: AFP)
(Pic: AFP)

Since then the service has grown exponentially, with about $40-billion flowing through the service in Kenya alone.

Part of daily life
In Kenya, the system has become a part of daily life, with more than 18-million customers, and is used by almost two-thirds of the population with more than eight million transactions daily.

The network allows customers to bypass the traditional banking system, using an application available on the simplest of mobile phones to pay utility bills, buy a drink in a bar, or send cash to family and friends.

Romania is the latest nation Vodafone is tapping, with its first European launch last March.

For Michi Carstoiu, an engineer in the capital Bucharest, M-Pesa complements established online payment services.

“Most importantly, I save time – plus I think the transaction fees are smaller,” Carstoiu told AFP, shortly after activating his mobile phone account at one of the 1 000 outlets already open.

The number of distribution points is expected to triple by the end of the year.

“Everyone has a mobile phone, and it is very simple to send and receive money or make payments,” he added.

Users can charge up their phones by paying in cash at mobile-money agency points, and often at one of the points where they are doing a transaction.

Similarly they can withdraw cash against mobile-money credits at an agency, or when settling a bill, much in the same way as customers in Europe can obtain cash at some supermarkets when using bank cash cards.

Agents are often found in the form of shops or street kiosks.

The outstanding credit can be sent via a special text message to others for a small transaction fee.

African countries using the system include Egypt, Lesotho, Mozambique and Tanzania, and it has also been rolled out in India.

A savings version has been set up as well, allowing those without access to formal banking systems to earn interest on their savings.

The scheme has largely succeeded in Kenya because it meets the needs of millions of people without a bank account who would otherwise operate strictly within a cash economy.

They benefit from a network of M-Pesa agents spread across the country.

Romanians reliant on cash
Officials said that Romania was chosen as the European launchpad because many people in the eastern European country still rely on cash.

“The majority of people in Romania have at least one mobile device, but more than one third of the population do not have access to conventional banking,” Joseph said.

He is targeting seven million potential Romanian customers who operate in cash alone, and the company aims to reach 300 000 customers by the year’s end.

More than $1.2 billion worth of person-to-person transactions are sent on the system each month worldwide, according to Vodafone.

In Kenya, transactions can be as small as a single cent or as much as $1 600, while in Romania up to $9 000 can be sent each day.

Moving beyond emerging markets means adapting to fresh challenges however.

The operator will face different regulatory environments, and consumers who already have access to a wide range of financial services.

For Kenyans, where the network is used for everything from paying for grocery shopping and restaurant tabs to sending cash to relatives in remote regions, the spread abroad has given some a sense of pride.

In a way, the M-Pesa system has taken banking full circle, back to the founding principles of Venetian banking when money changers began keeping ledgers of credits and debits for traders who did not want to carry gold and silver with them.

These money dealers set up networks of correspondents, or agents, who ran parallel ledgers, enabling traders who otherwise had no “banking” system, to settle accounts, paying in or drawing out cash only when necessary.

“Technology that started out in Kenya is being exported to Europe,” said 24-year-old Rhoda Kibuchi, who runs an M-Pesa outlet in Nairobi. “It’s good news.”

Dear Zanu-PF, here’s my application for one of those 2.2 million jobs you promised

Dear post-election Zanu-PF (aka Government of Zimbabwe)

RE: APPLICATION FOR ONE OF 2.2 MILLION JOBS

With reference to your election manifesto, which excited even the MDC-T to splitting point and made me put a cross next to your name on the ballot paper, I hereby apply, publicly, for any one of the 2.2 million jobs you promised in Zim Asset. In case you have forgotten, this is that economic blueprint you came up with in October 2013, which is meant to “to provide an enabling environment for sustainable economic empowerment and social transformation to the people of Zimbabwe”.

July 31 marked exactly one year since I cast my first official ballot in the country’s elections, ending previous attempts at maintaining my political virginity. Now, there is some background I should give you. I do not bet or play the lotto because everything I put my bet on seems to lose. Even when I want my football team to win, I don’t watch the match. That is why I have not been voting all these years. I hated to see what I love losing. But last year, for the first time, I took the risk – and the jinx was broken! You won the election. However, looking back on my country, I’m concerned about whether the jinx was really broken. Could it be that in you winning massively, Zimbabwe actually lost quite a lot?

Forgive my rambling. With so many of my job applications gone unanswered, I do not know if it was my cover letter that failed me, or the comma that was missing from my CV, or if it’s just that none of the 2.2 million jobs you promised are on the market yet. But the issue at stake here is that I am looking for a job, and urgently so, because I am 31 and unmarried and cannot afford to be unemployed. One may ask why I am applying to you. Most of the companies I approached are either already closing down or downsizing staff, and employing me is an unrealistic dream for them. But I know you have 2.2 million jobs that you promised me in 2013, and I have come to claim at least one.

I am one of those “resources that gives Zimbabwe a comparative advantage over regional and other international countries is its economic complexity that includes the strong human resource base, which is an outcome of a deliberate educational policy instituted by the ZANU-PF Government at Independence in 1980.” Unfortunately, I have been trying to make myself a useful resource with little success, hence I’m approaching you so that you can employ me.

I hold a qualification in tourism and hospitality, among other numerous qualifications, and should be glad that tourism is one of your key target economic areas with huge potential. It’s just that I have not seen what you referred to in Zim Asset as “Quick Wins” or “rapid results yielded “in the shortest possible time frame (October 2013 – December 2015)”. Obviously I blame this on the fact that no initiatives have been implemented or “blitz interventions” made since I voted for you. Damn the sanctions, of course. Oh, I had forgotten that there are also sanctions-busting strategies. So damn the inaction. What have you been doing this whole past year?

Secondly, survival has taught me all these other vital skills and given me a great deal of experience, which will account for any gap periods in my CV. Like most others, I am now a serial entrepreneur, sometimes vendor, marketer, social media enthusiast, administrator, occasional job-hunter and writer. So, do not get me into the unemployed-experience-unemployed conundrum. I don’t deserve it, neither do millions other Zimbabweans who have faced desperate situations, including this economy, and lived through it.

And if there are any other things that you deem important which I do not have, such as a driver’s licence and a passport, please remember that I might not have been able to afford the $200+ required to bribe driving inspectors, or had the time to wait in unending queues at the Registrar General’s offices.

And lastly, if it turns out that all the other vacancies have already been filled by the numerous educated but unemployed youths roaming the streets – most of whom are thinking of leaving the country – I would like to become one of the officials in the Office of the President and Cabinet who will “play a leading and co-ordinating role as overseer of the implementation process to ensure attainment of set targets of the Plan.”

At least I know that vacancies still exist in this section of Zim Asset because, with nothing happening, my only guess is that no one is co-ordinating the implementation process of this brilliant document. My claim to employment in this section is backed by my qualification in monitoring and evaluation, and validated testimonies that I am discreet, patriotic and intelligent enough to meet your requirements.

Please note:

  1. Do not take this a joke; I really need a job and so do millions others. And the earlier you make those “blitz interventions” for “Quick Wins”, the better it is for all of us. December 2015 is not far away.
  2. At this point don’t refer me to non-working youth funds. I have tried those before. All I need is a job. A piece of land would be a welcome alternative though.
  3. Please ensure that I get a job in haste before South Africa and its post-election ANC deport the more than 3 million jobless Zimbabweans there back home.
  4. I can attend interviews as fast as the kombi you want to banish without an alternative can take me to the venue.

Regards (because we are compatriots and I deserve better from you),
Lawrence Hoba

 

Lawrence Hoba is an entrepreneur, author and passive politician.  His short stories and poetry have appeared in The Gonjon Pin and Other Stories, Writing Lives, Laughing Now, Warwick Review and Writing Now.  His anthology, The Trek and Other Stories (2009), was nominated for the NAMA in 2010 and went on to win the ZBPA award for Best Literature in English. It tackles the highs and lows of Zimbabwe’s land reform. Connect with him on Twitter: @lawhoba

Haircare share: Africa’s multibillion-dollar cut

With all the skill of a master weaver at a loom, Esther Ogble stands under a parasol in the sprawling Wuse market in Nigeria’s capital and spins synthetic fibre into women’s hair.

Nearby, three customers – one in a hijab – wait for a turn to spend several hours and $40 to have their hair done, a hefty sum in a country where many live on less than $2 a day.

While still largely based in the informal economy, the African haircare business has become a multi-billion dollar industry that stretches to China and India and has drawn global giants such as L’Oreal and Unilever .

Hairdressers such as Ogble are a fixture of markets and taxi ranks across Africa, reflecting both the continent’s rising incomes and demand from hair-conscious women.

“I need to braid my hair so that I will look beautiful,” said 25-year-old Blessing James, wincing as Ogble combed and tugged at the back of her head before weaving in a plait that fell well past the shoulder.

While reliable Africa-wide figures are hard to come by, market research firm Euromonitor International estimates $1.1-billion of shampoos, relaxers and hair lotions were sold in South Africa, Nigeria and Cameroon alone last year.

It sees the liquid haircare market growing by about 5% from 2013 to 2018 in Nigeria and Cameroon, with a slight decline for the more mature South African market.

This does not include sales from more than 40 other sub-Saharan countries, or the huge “dry hair” market of weaves, extensions and wigs crafted from everything from synthetic fibre to human or yak hair.

A man prepares wigs as he waits for customers in downtown Johannesburg on August 5 2014. (Pic: Reuters)
A man prepares wigs as he waits for customers in downtown Johannesburg. (Pic: Reuters)

Some estimates put Africa’s dry hair industry at as much as $6 billion a year; Nigerian singer Muma Geerecently boasted that she spends 500 000 naira ($3 100) on a single hair piece made of 11 sets of human hair.

Informal economy
Haircare is a vital source of jobs for women, who make up a large slice of the informal economy on the poorest continent.

But business in Wuse market has slowed recently, said 37-year-old Josephine Agwa, because women were avoiding public places due to concerns about attacks by Islamic militant group Boko Haram.

The capital has been targeted three times since April, including a bomb blast on a crowded shopping district in June that killed more than 20 people.

“The ones that don’t want to come, they call us for home service,” she said as she put the finishing touches on a six-hour, $40 style called “pick and dropped with coils” – impossibly small braids that cascade into lustrous curls.

Haidressers attend to clients in Lagos, Nigeria. (Pic: AFP)
Haidressers attend to clients in Lagos, Nigeria. (Pic: AFP)

Nigerians are not alone in their pursuit of fancy locks.

“I get bored if I have one style for too long,” said Buli Dhlomo, a 20 year-old South African student who sports long red and blonde braids. Her next plan is to cut her hair short and dye it “copper gold”.

“It looks really cool. My mum had it and I also had it at the beginning of the year and it looked really good,” said Dhlomo, who can spend up to R4 000 rand ($370) on a weave.

Daring styles
While South Africans change their hairstyle often, West Africans do so even more, said Bertrand de Laleu, managing director of L’Oreal South Africa.

“African women are probably the most daring when it comes to hair styles,” he said, noting that dry hair – almost unheard of a decade ago – was a growing trend across sub-Saharan Africa.

“Suddenly you can play with new tools that didn’t exist or were unaffordable.”

The French cosmetics giant this year opened what it billed as South Africa’s first multi-ethnic styling school, training students of all races on all kinds of hair, something that would have been unthinkable before the end of apartheid in 1994.

While the South African hair market remains divided, salons are looking to boost revenues by drawing in customers across ethnic groups, meaning hairdressers who once catered only for whites will need stylists who can also work on African hair.

L’Oreal is looking to build on its “Dark and Lovely” line of relaxers and other products with more research into African hair and skin and has factories in South Africa and Kenya producing almost half the products it distributes on the continent.

Hair from India, via China
Nor is it alone.

Anglo-Dutch group Unilever has a salon in downtown Johannesburg promoting its “Motions” line of black haircare products, and niche operators are springing up in the booming dry hair market.

“We supply anything to do with dry hair, across the board,” said Kabir Mohamed, managing director of South Africa’s Buhle Braids, rattling off a product line of braids, weaves and extensions that use tape, rings or keratin bonds.

Today there are more than 100 brands of hair in South Africa, making the market worth about $600-million, he said, roughly four times more than in 2005.

Much of the hair sold is the cheaper synthetic type and comes from Asia. Pricier natural hair is prized because it lasts longer, retains moisture and can be dyed.

India’s Godrej Consumer Products acquired South African firm Kinky in 2008 and sells synthetic and natural hair, including extensions, braids and wigs.

Buhle Braids, like its rivals, sources much of its natural hair from India, which has a culture of hair collection, particularly from Hindu temples or village “hair collectors”.

The hair is then sent to China where it is processed into extensions and shipped to Africa. Hair from yaks, to which some people are allergic, is now used less.

In one clue to the potential for Africa, market research firm Mintel put the size of the black haircare market in the United States at $684-million in 2013, estimating that it could be closer to $500 billion if weaves, extensions and sales from independent beauty stores or distributors are included.

What is certain is that Africa’s demand for hair products, particularly those made from human hair, is only growing.

“It hurts, but you have to endure if you want to look nice,” said Josephine Ezeh, who sat in Wuse market cradling a baby as a hairdresser tugged at her head. “Hair is very, very important.”

French winemaker Castel bottles its first Ethiopian wine

The grape names – merlot, syrah, cabernet sauvignon, chardonnay – are distinctly French, but the label on the Rift Valley wines is surprising: made in Ethiopia.

The French beverage giant Castel, one of the world’s biggest producers of wines and beers, is raising a glass to its first production of 1.2-million bottles of Ethiopian Rift Valley wine.

The African state’s former president Meles Zenawi, who died in 2012, encouraged Castel to develop vineyards in Ethiopia, one of Africa’s poorest countries, as a way of improving its image.

Half of the bottles are destined for domestic consumption and half for export to countries where the Ethiopian diaspora have settled, though 26 000 have already been snapped up by a Chinese buyer.

Lab equipment for testing wine is pictured at the Castel winery outside the town of Ziway, central Ethiopia. (Pic: AFP)
Lab equipment for testing wine is pictured at the Castel winery outside the town of Ziway, central Ethiopia. (Pic: AFP)

Although Castel does not expect its Ethiopian wine business to make a profit until 2016, it hopes to more than double production to 3-million bottles a year. Though Ethiopia is better known for its production of another drink, coffee, Castel says the African country has the potential to rival the continent’s main wine producer, South Africa.

“It’s not that difficult because the climate is good and it’s not too hot,” Castel’s Ethiopia site manager, Olivier Spillebout, told Agence France-Presse. “Exports are small now, but year after year they will grow.”

The company has produced a better quality wine called Rift Valley, selling in Ethiopia for the equivalent of €7 (£5.50) and a grape-mix wine called Acacia, retailing at the equivalent of €5.

It is not the first wine to be commercially produced in Ethiopia. Vineyards established near Addis Ababa and in the south-east by Italian troops who occupied part of the country from 1936 to 1941 were later nationalised, then privatised, and are now run by Awash Winery, which boasts Live Aid founder Bob Geldof as a director.

Landscape perfect for grape growing
Wine experts say parts of Ethiopia’s diverse landscape, which include high plateaux and verdant valleys as well as six climatic zones, are perfect for grape growing.

Pierre Castel, the billionaire founder of the family-run group, could see the potential in the sandy Ethiopian soil, the short rainy season, cheap land and equally cheap and abundant labour for wine production. The Castel company had been producing beer in Ethiopia since 1998 after buying the state-owned brewery called St-Georges.

After striking a deal with the Ethiopian government in 2007, Castel immediately dispatched the company’s best French experts who spent seven months looking for areas for the vineyards.

They finally chose a site 160km to the south of the capital, near the town of Ziway, where 750 000 vines, brought from Bordeaux, were planted over 125 hectares by 750 local workers. Merlot, syrah and cabernet sauvignon grapes were chosen for the reds that make up 90% of Castel’s Rift Valley production, and chardonnay grapes for the white wines.

Women pick grapes at the vineyard of the Castel winery outside the town of Ziway, central Ethiopia. (Pic: AFP)
Women pick grapes at the vineyard of the Castel winery outside the town of Ziway, central Ethiopia. (Pic: AFP)

A member of the Castel team, who did not want to be named, told the Guardian the aim of the company’s “considerable investment” in the Ethiopian vineyards was to produce a wine of international quality.

While there had been several grape harvests since 2007, this was the first time the company had bottled the wine produced.

“We have used the same savoir faire we used on our French vineyards and as we do on those in Morocco and Tunisia, to produce this Ethiopian wine,” he said. “Our objective is to produce a wine worthy of international standards so we preferred to have multiple trials before engaging in the process of commercialising the wine.”

He said the wine produced was “aromatic and fruity”, with a pleasant, middle-of-the-road taste.

A delighted Ahmed Abtew, the Ethiopian industry minister, said in a recent interview: “People who live outside Ethiopia remember the drought a decade ago, but when they see a wine labelled ‘Made in Ethiopia’ … their whole attitude immediately changes.”

Growing grapes in the Horn of Africa is not, however, without its hazards and French winemakers lament their vines being devastated by disease and a series of catastrophic hailstorms.

Castel’s Ethiopian vineyards are also surrounded by a two-metre-wide trench to deter pythons, hippopotamuses and hyenas.

Fish sperm potions and camel’s milk concoctions keep love alive in Nigeria

(Pic: Flickr / Ani Thompkins)
(Pic: Flickr / Ani Thompkins)

Has your love life lost its spark? Too tired after long days at work? Or maybe you suspect your partner’s eye has been wandering?

Zainab Usman, a Muslim from northern Nigeria, says she has the solution for all these problems. Walking through a room lined with jars, bottles and gourds, perfumed air trailing in her wake, she ticks off each remedy on delicately manicured fingers. Out come a stream of names that sound like a cross between children’s sweets and street slang for class A drugs.

There is the “wonder wand”, a vial of peppercorn-sized pills that promise to enhance intimate experiences. Zuman mata, which translates as “woman’s honey” in northern Nigeria’s Hausa language, is guaranteed to “keep a man coming back”. Or how about tsumi, a herb and camel’s milk concoction that Usman has nicknamed “cocaine” which, if its effects match up to the claims, is best taken only if the user has several days spare to recover?

This is the world of kayan mata (“women’s things”), a five-century-old practice in northern Nigeria and neighbouring Niger aimed at keeping married couples’ love lives lubricated, so to speak. Handed down the generations by women, the creams, scrubs, perfumes and tablets are made using local herbs and roots that grow in the arid north. Traditionally meant to prepare a bride for marriage and ensure social stability by keeping couples happily married, they are growing in popularity.

Men have their own version, called maganin maza (“men’s potions”), which includes chilli-infused foods.

Neither country particularly needs a helping hand in the sex department: 11 000 babies are born every day in Nigeria, the world’s eighth most populous country, while Niger has the world’s highest birth rate. But the centuries-old kayan mata is one of the few times when sex is openly discussed amid an otherwise decidedly old-fashioned approach to discussing physical intimacy and its consequences.

“In the north, girls start learning about it at a very young age,” said Usman, whose female in-laws presented her with a kayan matagift box on the eve of her wedding. It accompanied the equally traditional gara – a gift of kitchen utensils as the couple started a new home.

“The south is a good market for me because it’s still new here, although I’m not sure Lagosians are ready for this,” says Usman, who has started selling her wares in Lagos, hundreds of miles south of her home city of Sokoto.

As two giggling friends visit Usman, a third hovers disapprovingly nearby, though not so far as to be out of earshot.

“Do you have ones that uplift breasts?” the first friend asks.

“Of course,” replies Usman, pouring a thick liquid into a tiny jar. For good measure, she adds a green powder called danagadas (“the one from Agadez” – a city in Niger’s Sahara desert). “I can’t use this one very much, I’d be too tired,” she adds.

What happens, one of the women wants to know, if you stop taking the herbs?

“Your husband will notice a massive difference straight away,” Usman says, snapping her fingers. The two friends look at each other and fall about laughing.

“You guys are making me feel uncomfortable,” Usman says, a hint of reproach in her voice. “I’m trying to help you. It’s not a big deal – women have been using this for ages.”

The ingredients of kayan mata have changed little over 500 years except, perhaps, that dried camel’s milk is now preferred to fresh as the goods travel longer distances. Typically, products have a base of rice, honey, millet and tiger nuts. Fish sperm and manatee fat are sometimes thrown in. Key, though, are the roots of the desert-growing jujube, baobab and catchthorn trees, which have long been used medicinally across the Sahara. Some herbs are so localised English translations are hard to come by.

“There’s no reason to suppose that there’s not some interesting ethnopharmacology behind the use of these remedies,” says James Moffatt, a senior lecturer at St George’s hospital, University of London.

Nevertheless some may be placebos similar to the western perception that oysters are aphrodisiacs, he says. “If dim lights, mood music and a plate of molluscs do it for one culture, why not camel milk and dates for another?”

Business is certainly booming. Big-name dealers include one of the wives of former president Ibrahim Babangida.

In the labyrinthine streets of Wuse market in the capital Abuja, Umar Mohammed, 56, sits in his booth surrounded by imitation gold jewellery, intriguingly named fake perfumes, sequinned headscarves and incense burners.

But at a word from two visiting customers, he springs into life and throws open a cupboard full of the familiar vials and powders. “Why didn’t you say [what you wanted] right away?” after two elderly women in hijabs spend 15 minutes apparently poring over a single stick of incense.

He tries to sell them a dust-covered box of products whose extraordinary price is justified, he says, as it came from Malaysia. “When a woman uses these products, she will look and smell like a flower, which is how it should be.”