Fuel shortages in Equatorial Guinea: An aberration to Africa’s liberty by Chofor Che, 29 July 2013

Equatorial Guinea is a state situated in Middle Africa. With an area of 28,000 square kilometres (11,000 sq mi), Equatorial Guinea happens to be one of the smallest states in Africa. It is composed of two parts, a mainland and an insular region. The mainland region, Río Muni, is bordered by Gabon on the south and east and Cameroon on the north. The insular region is composed of the islands of Bioko (formerly Fernando Pó) in the Gulf of Guinea and Annobón, a small volcanic island south of the equator. Bioko island is the northernmost part of Equatorial Guinea and is the site of the country’s capital, Malabo.

Equatorial Guinea is one of sub-Sahara’s largest oil producers. With a population of 650,702, it is the richest state per capita in Africa, and its gross domestic product (GDP) per capita ranks 69th in the world. However, the wealth is unevenly distributed and just a few people have benefited from the oil riches. According to the United Nations, less than half of the population has access to clean drinking water and that 20% of children die before reaching five.
On the 25 of July 2013, the government of Equatorial Guinea announced that the state had suffered from a shortage in petroleum products especially fuel. This news came as a big shock to Africa and the whole World. According to a report from the Economist dated 25 July 2013, tensions between France and Equatorial Guinea are set to rise as the regime blames a French company for the shortages.

Some experts were invited over the weekend to a special programme to the popular broadcasting station of France 24, to share their views on why Equatorial Guinea has to suffer from fuel shortages despite its oil rich status. Some of these experts were of the view that the West especially France has always had a strategy to distabilise regimes in Africa by making the population riot against these said regime. These analysts added that France caused the fuel shortages to make the population of Equatorial Guinea riot against the regime in power. Other invited analysts added that the regime in power was the cause of fuel shortages. For long now, just a few corrupt officials have been benefitted from the proceeds of oil and gas production in Equatorial Guinea. Oil and gas multinationals especially from France have been given the lee way to manipulate regimes at the expense of the populace.

In as much as the government of Equatorial Guinea blames France for fuel shortages, the bigger share of the blame rest with the government of Equatorial Guinea. This was a scenario which was foreseeable especially as the state allowed few corrupt individuals to benefit from the oil and gas sector in Equatorial Guinea. The state of Equatorial Guinea like many other states rich in oil and gas in Africa, has allowed multinationals from the West in complicity with the World Bank and International Monetary Fund, to manipulate oil and gas production as well as the prices of finished products. Despite the oil and gas wealth in Africa, states like Equatorial Guinea are still plagued by underdevelopment.

Africa can indeed benefit from oil and gas if the people and not corrupt government officials are put first. States in Africa like Equatorial Guinea need to start rethinking their development policy especially in the oil and gas sector. Local content needs to be amplified upon. Talking about local content and holding workshops on local content is not enough. Africans need to be adequately employed and remunerated in the oil and gas industry. Africans especially Equatorial Guineans need to be involved in deciding on policy on fuel prices, especially as these products are necessary for human survival. Such measures can save Africa and Equatorial Guinea from an aberration.

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The end of the visa quagmire plaguing six member states circulating within the Economic Community for Central Africa, By Chofor Che, 24 July 2013

Lying over about one third of the African continent, Central Africa is adjacent to all of Africa’s sub regions. This sub region is the region in Africa most endowed with natural resources especially crude oil and forests reserves. It also holds the largest water reserves on the African continent. Despite such wealth, the manufacturing base in the Central African sub region remains very narrow and although there is availability of relatively good agricultural land, food production is still below the needs of the population.

Many organisations have been created in the sub region with the aim of attaining economic cooperation among the member states. This is notably with the case of the Economic Community for Central African States (ECCAS) which was founded in 1983 and became operational in 1985. Six out of the eleven member states of the sub region share a common currency zone (the CFA Franc) and a monetary zone union known as CEMAC (Communauté economique et monetaire d’Afrique centrale). These six states include Cameroon, the Central African Republic, the Republic of Congo, Gabon, Equatorial Guinea and Chad. The large population in these six member states makes it potentially a huge consumer market, yet sub regional cooperation arrangements have not succeeded in unleashing this full economic potential and move it towards economic integration. Goods manufactured in Central Africa do not circulate easily in the ECCAS zone. Citizens for instance, of Cameroon, are still requested to obtain visas before travelling to Gabon. In contrast citizens of other sub regional groups like the Economic Community of West African States (ECOWAS) are not requested to obtain visas to circulate in member states. This precarious situation in the above mentioned six member states of ECCAS, impinge on the development of the market for consumer goods while stifling local entrepreneurship. Local producers are left with no choice than to be involved with smuggling and illicit exportation.

The Head of States for the above mentioned six states of the Economic Community for Central Africa (ECCAS) met during their last summit in June 2013. During this meeting the Heads of State for the six states in the ECCAS zone, agreed that visa requirements would henceforth not be obligatory for citizens of member states circulating in these states. This move is to take effect as from January 1, 2004.

Eradicating visa requirements for these six member states is indeed a laudable initiative which would go a long way to facilitate business transactions and economic ties amongst member states of the ECCAS zone. This would indeed unleash the full economic potential and facilitate the move towards economic integration in the sub region. It is also hoped that the eradication of the visa requirements for these six concerned states would facilitate the circulation of goods and agricultural produce in these member states. Eradicating visa requirements without ensuring that stringent barriers like heavy taxation of goods and agricultural produce are equally dismantled would serve no purpose. While citizens of the six member states of ECCAS that share the CFA franc await to benefit from the ‘no visa’ requirement move, it is important that Heads of State of these member states also put in place other measures like curbing heavy taxes. It is also important for these Heads of State to encourage partnership cooperation among the private sectors of these member states so as to facilitate rapid regional integration and economic growth.

 

Western worries about money-laundering are threatening an economic lifeline for millions of Africans Jul 20th 2013 | NAIROBI |From the print edition of the Economist

FOR Mohamed Abdulle, sending money to his family in Somalia means a trip to a high street in Stratford, East London, home to a large expatriate community. Once there he hands over cash, a telephone number and a name, usually that of his grandmother who lives in Somalia’s capital, Mogadishu, to an agent. A few minutes later Mr Abdulle, who works as a shop assistant, gets a text message letting him know the cash has arrived on the other side. This fast and reliable system, developed during decades of war in Somalia, is used by hundreds of thousands in the global diaspora, as well as by some UN offices and aid agencies to pay staff.

Perhaps not for much longer. Barclays, a big retail bank, has served notice that it will close the accounts of some 250 money-transfer businesses. The bank said the decision followed a routine legal review. Some money remitters “don’t have the proper checks in place to spot criminal activity,” the bank says, or could “unwittingly” be financing terrorists.

Barclays was among the last British banks willing to deal with agents who cheaply transfer money to poor countries. Many European banks have become nervous about such cash transfers after the American government last year forced HSBC, another big British bank, into a $1.9 billion settlement over allegedly shoddy money-laundering controls.

The impact of Barclays’ decision will be felt across east Africa. Without accounts, the transfer agents cannot operate and their businesses in Somalia’s neighbours, Kenya and Ethiopia, may be hindered, too. The agents, who need a bank account to get a licence, insist they have no problems with law enforcement or regulators. Cash going to extremists in Somalia is sent in sacks by plane, not from a London suburb a few hundred dollars at a time.

The agents are asking what extra measures banks want them to take. Abdirashid Duale, who runs Dahabshiil, the largest Somali money-transfer agency and a customer of Barclays for the past 15 years, says he is willing to comply with any transparency checks the bank requires. He estimates that $500m is sent to Somalia from Britain each year and thinks much of this money will switch to underground agents if legal operators are put out of business.

Dominic Thorncroft, who heads the British money-transfer trade association, says as many as 50 of his 170 members face closure. Under pressure from British MPs, some of whom are elected in constituencies with large migrant populations, the bank has agreed to a 30-day stay which ends in mid-August.

Meanwhile, a group of 100 academics and other notables has written to the British government asking it to avert a humanitarian crisis in the Horn of Africa. An estimated 40% of Somalia’s population depends on money sent from abroad. A recent study showed that three-quarters of recipients need the money to buy essentials, such as food and medicine.

“This will mean children being pulled out of school, people going hungry or not getting medicines they need,” said Laura Hammond, a lecturer at the University of London. The Somali Money Services Association, another British trade body, warned that the consequences of the closure of the accounts would be “worse than the drought” that ravaged Somalia two years ago and killed tens of thousands.

So far attention has focused on Somalia, where years of conflict have destroyed the banks and left no real alternatives to cheap money transfers. But the 250 firms put on notice by Barclays also include some serving Ghana and Nigeria, as well as India and Bangladesh. More sophisticated and expensive competitors such as Western Union may now benefit. A reduction in competition in the African remittance market will drive up prices.

Africans already pay more than any other migrant group to send money home. The cost of remitting to sub-Saharan Africa, typically around 12%, is three percentage points higher than the global average, according to the World Bank. If African rates could be brought in line with those of South Asia, African migrant families would save more than $4 billion a year. Instead rates are likely to rise further.

Some observers are calling for the creation of new institutions that could replace private banks. One suggestion is a “remittance bank” hosted by the UN or a multilateral agency. Another is a code of conduct worked out by remitters, banks and regulators. “This needs to be driven by government,” says Leon Isaacs of the International Association of Money Transfer Networks. “Or the banks won’t get the comfort they want.”

From the print edition: Middle East and Africa

 

Africa Cotton and Textile Industries Federation (ACTIF) strives to ensure fabric is fully produced in Africa, July 18, 2013, sourced from http://www.fibre2fashion.com (Kenya)

The International Monetary Fund (IMF) maintains that, the African region is on track to grow by five percent before the end of 2013. This is, no doubt, a reflection of the competing involvement of Asian powers in the continent, which is raising concerns from the west in terms of trade, exports and imports, cooperation and sponsorship.

According to the World Bank statistics, over the last 10 years, Africa has experienced an increase in export of more than two hundred percent, and an increase in import of two hundred and fifty percent from 2001 to 2011. This has sparked the interest and attention of the west to rethink their position in terms of trade policies towards Africa. For instance, as detailed in Senator Coons’ Embracing Africa’s Economic Potential, March 2013, the Obama administration has recognized the need to accelerate and deepen economic engagement in Sub-Saharan Africa.

Some of the policies in the June 2012 policy document (US Strategy Toward Sub-Saharan Africa) in lure of this objective by the administration include: 1) working with African partners to promote an enabling environment; 2) improving economic governance and transparency while reducing corruption; promoting regional integration; 3) expanding African capacity to access global markets; 4) encouraging US companies to trade with and invest in Africa. In line with the above objective, it is inextricably fundamental for the US to review and authorize the extension of the African Growth and Opportunity Act (AGOA) beyond 2015, since AGOA has been the back bone for economic growth and development for several African countries.

However, while some countries in Africa remain unaware of the opportunities AGOA offers, many African countries still lack the much needed industrial base and competitive productive capacity to fully maximize the opportunities of AGOA. It is against this back drop that ACTIF continually lobbies for the extension of AGOA as it strives to empower local cotton, textile and apparel value chain in the African region in order to increasing its competitive capacity in the global market.

Currently, the demand for fabric in the Sub-Sahara African market far exceeds the present production and supply. Considering the economic cost in sending African cotton to Asia for processing into fabric before shipping it back to Africa to be cut and sewn into garments, ACTIF is playing a key role in cutting this cost by ensuring that the fabric is fully produced adequately in Africa.

This calls for urgency in exploring the opportunities for investing in weaving, spinning dyeing and finishing in the region. In line with this achievement, African governments should be taking initiatives in creating investment-friendly regimes as currently being witnessed in the case of Ethiopia. Also there has been a remarkable increase in support by international organizations such as Business Advocacy Fund that approved its support to ACTIF in carrying out AGOA outreach programs.

Other international organizations, such as Innovations for Poverty Action (IPA) are also actively conducting studies on how to improve various industrial sectors including the Textile and Garment sector across Africa.

Rajeev Arora – ACTIF

 

Can Cameroon’s adherence to the Comprehensive Africa Agriculture Development Programme help in fighting poverty in the country? By Chofor Che, 19 July 2013

Africa is very wealthy with vast amounts of territory for agricultural produce. Despite such wealth, the continent continues to lag behind in the agricultural sector. Countries in Central Africa like Cameroon, Gabon, Equatorial Guinea and Chad still face difficulties in feeding their ever growing populations. As a result of this mêlée, African Heads of State have amplified upon measures to ensure that the continent benefits commendably from the agricultural sector.

The Prime Minister of Cameroon, Philemon Yang officially signed documents on the 17 of July 2013 confirming Cameroon’s adherence to the Comprehensive Africa Agriculture Development Programme (CAADP). African Heads of State established the CAADP as part of the New Partnership Agreement for Africa’s Development (NEPAD) in July 2003, during a reunion in Maputo, Mozambique with aim of improving and promoting agriculture across the African continent. They agreed to apportion 10 per cent of their budget to the improvement of agriculture in Africa.

Following a report in Cameroon Tribune dated the 18 of July 2013, Prime Minister Philemon Yang, after signing the CAADP agreement, called on government officials to partner with the private sector to ensure that Cameroon’s agricultural sector is a success. On the 13 October 2011, Prime Minister Yang had addressed an administrative correspondence to NEPAD’s Executive Secretary, assuring him of Cameroon’s adherence to the CAADP initiative.

Cameroon’s Minister of Agriculture and Rural Development, Essimi Menye in an interview with the local press, was optimistic that the CAADP initiative will assist government create the National Programme for Investment in Agriculture. He added that the government of Cameroon will ensure that by December 2013, the National Programme for Investment in Agriculture is tabled before the Head of State for his approval. The National Programme for Investment in Agriculture is supposed to boost agricultural production from the current 4 per cent to 10 per cent by 2020, added Minister Essimi Menye.

Other parties of the private sector who signed the CAADP agreement expressed their commitment to collaborate with government to ensure that Cameroon benefits from its agricultural sector. The representative of the African Union (AU) and NEPAD, Mariam Sow Soumare assured the Prime Minister that the AU was going to give Cameroon all its support to ensure a success of this initiative. Mr. Tchoungi Roger, Deputy Secretary General of the Economic Community of Central Africa States, ECCAS, added that ECCAS was also going to assist the government of Cameroon in this initiative.

The CAADP initiative in a laudable initiative and would be instrumental in the alleviation of poverty in Cameroon. The only fear is that similar situated programmes in the past have not yielded any fruit. Some of the past initiatives have either been hijacked by corrupt government officials and the money squandered or siphoned without any account. Poor farmers, who are supposed to benefit from such programmes have not benefitted much. They continue to benefit less from their produce, while corrupt officials embezzle funds destined for them.

It is imperative for NEPAD and ECCAS to ensure that the CAADP initiative does not remain entirely under central government control. There is need to ensure that the private sector also has a say especially in the financial management of this project. For sure a lot of foreign assistance shall be pumped into this initiative and if care is not taken, this money will be embezzled as before. If the government of Cameroon is serious about attaining some of the Millennium Development Goals, if not all, by 2015, then it is germane for a change of policy and state practice. Without this change of strategy which is of utmost importance to agricultural development in Cameroon, then the CAADP initiative will remain futile.

 

Bad governance and corruption in the Cameroon Football Federation (FECAFOOT) leads to suspension by the World’s Football Federation (FIFA) – Chofor Che

The World’s Football Federation (FIFA) provisionally suspended the Cameroon Football Federation (FECAFOOT) on the 4 of July 2013. According to a BBC source, this was due to government interference of the FECAFOOT elections, which took place on 19th June 2013. During the period of suspension, Cameroon is not to take part in any regional or international matches, including club matches and friendly matches. In addition, no FECAFOOT member or official shall benefit from any development programmes or training courses during the suspension period.

Article 13 and 17 of the FIFA Statutes oblige member associations to manage their affairs independently with no interference from third parties. During these elections, former FECAFOOT boss Iya Mohammed who doubled as boss of the state owned cotton company, SODECTON, detained by the Cameroon authorities for alleged financial mismanagement of this state-owned cotton company, emerged victorious. The elections were cancelled by FECAFOOT’s appeals committee.

FIFA’s ruling came as a result of the 19 June elections, when FECAFOOT vice president and former transport minister Mr. John Begheni Ndeh installed himself as president on 28 June. Accompanied by the forces of law and order some of whom were stationed at FECAFOOT’s headquarters, Mr. Ndeh took over the federation and suspended the Secretary General Tombi A Roko. This also led to the resignation of FECAFOOT’s first vice president Seidou Mbombo Njoya, who had expected to step in as interim boss.

FECAFOOT has long been plagued by corruption and mismanagement. This has led to the poor performance of the national football team, the indomitable lions. A team which was once Africa’s glory is today classified as one of the weakest football teams on the continent. Cameroonian footballers prefer to play abroad for foreign clubs than to be humiliated back at home by their very own FECAFOOT.

Events leading to this unfortunate situation were alarming and visible. Despite cries from the public and footballers of the corruption and mismanagement of state funds pumped into FECAFOOT, the state remained silent to such cries. Many argue that since Iya Mohammed was a protégée of FIFA it was difficult for the state to intervene in the internal affairs of FECAFOOT. The state therefore allowed a very prestigious institution like FECAFOOT to be humiliated internationally.

A normalisation committee is to be set up as per Article 7 paragraph 2 of the FIFA statutes to revise the FECAFOOT statutes and to organise elections for new office bearers. This normalisation committee will be set up by FIFA in collaboration with the African Football Federation. The suspension will be lifted once the Cameroonian authorities allow the normalisation committee to enter the premises of the headquarters at conduct the said elections.

In as much as FIFA may be right in suspending FECAFOOT provisionally, Cameroon remains a sovereign state and has a right to meddle in matters affecting its wellbeing. Where the state of Cameroon erred was that it allowed an individual like Iya Mohammed to control FECAFOOT and SODECOTON for too long. In allowing such an individual like Iya control two important institutions for long, some state authorities benefited from corrupt dealings that were orchestrated during his era. The great football state, suffered from this state action.

In as much as Cameroon may have learned its lesson or not, it is vital for institutions like FIFA to ensure that institutions like FECAFOOT are not controlled by certain individuals for long. The state also has a say in issues concerning FECAFOOT, but should not take this advantage and usurp the powers of FECAFOOT. The indomitable lions have done no wrong to suffer from corrupt practices from big institutions like FIFA and FECAFOOT. If the state of Cameroon wants to regain its fame in the football circles once again, then it is vital to combat corruption and rethink its governance strategy over institutions like FECAFOOT.

This article is published at http://africanliberty.org/