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The African Union Has A New Chair And Here Is Where His Primary Focus Will Be

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The new African Union Chair receives the baton from his predecessor

President Kagame of Rwanda hands over the baton to President el-Sisi of Egypt

The African Union held its 32nd Summit on February 10, 2019. At the Summit, Member States elected President Abdel Fattah el-Sisi of Egypt as the new AU chair.

El-sisi takes over from President Paul Kagame of Rwanda. The new AU Chair addressed the Summit after the elections, setting his agenda for the African continent.

El-Sisi’s Profile

El-Sisi is the current president of Egypt–serving his second term after his re-election in 2018. El-Sisi is a graduate of the Egyptian Military Academy. After years in service, el-Sisi rose to the position of the director of military intelligence in 2010. Ultimately, he became Defense Minister and Commander in Chief when Mohamed Morsi was ousted.

In 2018, Forbes ranked el-Sisi at number 45 in the list of most powerful people in the world. The new African Union Chair has managed to restore Egypt to stability. As a result, this achievement saw his approval rating rise. Consequently, in the 2018 election, el-Sisi was re-elected with 97 percent of the vote.

El-Sisi’s Tasks as New AU Chair

Key on President el-Sisi’s agenda is the fight against terrorism on the continent. In his address at the Summit, the new African Union Chair stated that terrorism is one of the critical problems facing Africa. In addition, el-Sisi stated that the bloc will prioritize ‘preventive diplomacy’ and mediation in promoting peace in the continent.

El-Sisi’s new tasks differ from that of his predecessor. Whereas President Kagame focused on creating a free-trade zone that spans across the continent, eL-Sisi is putting his focus on fighting terrorism. However, there is a common agenda. Like his predecessor, el-Sisi will be required to align his approaches with the AU Agenda 2063.

The African Union Chair Position

The African Union Chair position is a ceremonial position that rotates within the five regions of the continent. As such, a succeeding Chair cannot come from the same region with current Chair.

In order for a candidate to win, he/she must garner the support of at least two-thirds of member states—or through consensus. President Thabo Mbeki was the inaugural Chair of the AU in 2002.

Term Limit

The African Union chair serves for one year. After that, member states elect a different Chair from a different region. The five regions of the AU include–Central, West, East, Southern, and North.

President Cyril Ramaphosa of South Africa has been announced as AU Chair for the year 2020. This means the AU leadership will be shifting from the North to the Southern region.

South Africa will have national elections on 8 May, 2019. As such, Ramaphosa will become Chair of AU in 2020 if he wins the South Africa elections and remains president—The AU chair position is held by a sitting president.

AU Commission

The AU commission is the Secretariat of the African Union. A Chairman leads the Commission, assisted by a deputy Chair. Additional members are the commissioners.

The Chair of the Commission chairs all meetings of the Commission. The position of AU Chair, therefore, is different from that of AU Commission chair.

 

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Business and Development

Pan African eCommerce Giant Jumia Makes History with NYSE listing

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Jumia

Jumia Technologies made history on 10th April 2019 following the approval of the Securities and Exchange Commission (SEC) allowing the pan-African e-commerce giant to sell its shares on the New York Stock Exchange (NYSE). Consequently, Jumia started trading its shares at $14.50 using the ticker symbol JMIA. This makes Jumia Technologies the first African startup to secure major global exchange listing.

Jumia is currently active in fourteen African countries including Nigeria, Ivory Coast, and Tanzania. The e-commerce platform has 81,000 active sellers with over 5,000 direct employees. According to a statement contained in its recent SEC filing, Jumia Technologies added three hundred thousand new active customers in the first quarter of 2019.

Through the sale of its American Depositary Shares, the company can raise up to $316. According to the Corporate Communications officer, Lisette Kwong, Jumia initially set its IPO at $14.50 but it opened and closed at higher prices.

Jumia’s Brief History and Growth

Jumia was co-founded in 2012 by Sacha Poignonnec, Jeremy Hodara, Tunde Kehinde and Raphael Kofi Afaedor. The company was an outgrowth of the Rocket Internet Company. However, its rapid growth allowed it to secure funding from investors like Millicom group, MTN, Orange, Goldman Sachs, and CDC. According to The Guardian, MTN is the largest shareholder with 29.7%. Rocket Internet is second on the log with 20.6%. Other investors and their stake include AXA Africa holdings (5.8%), AEH New Africa eCommerce (8.4%), and Millicom (9.6%).

The two Nigerian co-founders, Raphael Afaedor and Tunde Kehinde are credited with the creation of some of the company’s components including JumiaPay. However, they left the company in 2015 to build other startups.

What Next For Jumia?

Jumia’s share price was up by 61% in early trade. Inasmuch as NASDAQ is traditionally for technology companies, Jumia decided to list on NYSE. The Head of International Capital Markets at the NYSE, Mr. Alex Ibrahim said the company did so because they saw the benefits. According to Ibrahim, the volatility of NYSE is higher than its competitors. Speaking on the listing of the company on NYSE, the co-founders said,

“This achievement has been made possible thanks to the hard work of our teams, the trust of our consumers, as well as the commitment of our sellers and partners. All stakeholders deserve credit for this milestone, and we are just at the beginning of a long and great journey. We are going to continue to focus on our mission and to work even harder to help consumers, sellers, partners, and all stakeholders benefit from this technological revolution.”

Previous Awards

Jumia is attracting lots of attention but the pan-African eCommerce giant is not a stranger to accolades. Some of the awards on Jumia’s archive include;

  • Best New Retail (World Retail Awards 2013)
  • Online Retail Brand of the year (Brand Journalists Association of Nigeria (2013)
  • The innovative business of the year (Success Digest 2013)
  • Leadership ICT company of the year (2013)
  • Best use of Mobile App (Rima Awards)

E-commerce website of the year (Beacon of ICT Award)

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Business and Development

Gambia’s AfCFTA Ratification Means Africa Will Soon Become The Largest Free Trade Area In The World

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Gambia President Adama Barrow

The dream for a Continental Free Trade area in Africa became a reality when Gambia ratified the agreement. Initially, prospects of the agreement becoming a reality were hindered by a lack of numbers—falling short on the minimum threshold. With Gambia ratifying the agreement, the bill can now be actualized.

Gambia became the 22nd African country to approve the African Continental Free Trade Area Agreement—AfCFTA. Ethiopia was the 21st country to ratify AfCFTA when it approved the agreement on March 21, 2019. Gambia parliament ratified the agreement on April 2 2019.

African Continental Free Trade Area Agreement

The African Union brokered the agreement in 2018. The agreement was then signed by 44 countries on March 21 2018 in Kigali, Rwanda—out of a total of 55 member states. Among other provisions, the agreement requires member states to remove tariffs from 90 percent of goods. In addition, member countries will be required to allow free access of goods and services across the continent.

From March 17 to March 21, 2018, an Extraordinary Summit on AfCFTA was held in Kigali, Rwanda. During the summit, the agreement establishing AfCFTA was presented to African leaders for signatures. The agreement was framed such that it goes into force 30 days after 22 countries have ratified the agreement instruments. Furthermore, ratifying states are required to deposit the instruments with the Chairperson of AUC—African Union Commission.

Gambia’s ratification and completion of all due processes satisfy this constitutional requirement to bring the agreement into effect.

Required Instruments

Only 20 countries have ratified and deposited the required instruments with the AUC Chairperson—as of April 16, 2019.  Two countries, Zimbabwe and Sierra Leone, have obtained parliamentary approval but have not deposited the instruments.

The 20 countries that have already deposited the instruments of ratification include The Gambia, Ethiopia, Egypt, Togo, Senegal, Ivory Coast, Uganda, South Africa, Namibia, Mauritania, Mali, eSwatini (former Swaziland), Guinea, Djibouti, Congo Republic, Chad, Niger, Rwanda, Kenya, and Ghana.

Notable Non Signatory

The AfCFTA is moving forward, however, Nigeria’s lack of commitment to the agreement is a big blow. Nigeria is Africa’s largest economy but only an estimated 10% of its trade volume is done with other African countries. Nigeria’s hold out has been blamed primarily on influential Labor Unions

During the 2019 African CEO Forum in Kagali last month, President Kagame of Rwanda who had championed the AfCFTA during his tenure as the African Union Chairperson shared that he had reached out to Nigerian president Muhammadu Buhari to sign the deal.

There are still concerns however about how the agreement will be executed. At the same event, African billionaire Naguib Sawiris said: “The challenges are going to be in the implementation.”

Impact of the Agreement

The AfCFTA is expected to boost free trade and investment across Africa. Once it comes into effect, the African Continental Free Trade Area Agreement area will create the largest free trade area in the world. The agreement will bring together all the 55 member states of the AU. This means the agreement will cover a market of over 1.2 billion people. The Economic Commission for Africa estimates that this agreement has the potential of boosting intra-African trade by 52.3 percent.

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Business and Development

Mauritius and Kenya Sign New Deal. Ban Lifted on Kenya’s Produce

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Kenya’s president and Mauritius Prime Minister witness the signing of the deal

Kenya and Mauritius signed a new deal that saw Mauritius lifting a ban on Kenyan farm produce. The new agreement enhances trade between the two African countries. Mauritius had initially banned baby beans, baby carrots, broccoli, and avocados from Kenya. Bilateral talks between Mauritius Prime Minister Pravind Jugnauth and Kenya President Uhuru Kenya culminated in the lifting of the ban on these products.

Agreements

The bilateral talks also saw the signing of the Double Taxation Avoidance Agreement—DTAA. In addition, the two leaders signed a memorandum of understanding on cooperation for the development of an Export Processing Zone in Kenya.

Kenya and Mauritius also signed an Investment Promotion and Protection Agreement. Other agreements signed include MOU in the field of arts and culture, an MOU in the field of higher education and scientific research, and an MOU on tourism.

Impact of the Deal

The signed agreements will boost Kenya’s ambitions to reach its development goals. According to President Kenyatta, the agreements will particularly boost Kenya’s manufacturing sector and create employment opportunities.

The new deal will further foster cooperation between Mauritius and Kenya. This means that the cordial relationship between the two countries is enhanced. This relationship will boost trade and investment opportunities in both countries.

Both Kenya and Mauritius have long coastlines, and more benefits can be derived in their blue economies through cooperation. President Kenyatta stated that there is a need for the two countries to look for ways of enhancing maritime transport by linking the Port of Mombasa to Port Louis. An established link is considered a catalyst for growing trade and businesses in the two countries.

The key benefit to Kenya from the deal is the promotion of its agricultural produce. Mauritius lifted a three-year ban on Kenyan avocado. Kenya lost the avocado market in Mauritius in 2015. The ban was due to the Mauritian National Plant Protection Office citing low hygiene standards of the Kenyan avocados. Lifting of the ban will now see more exports of avocados to Mauritius, along with other farm produce such as baby carrots and broccoli.

Kenya’s deal with Mauritius follows an initial pact with China. In 2018, Kenya signed deals with China and the Republic of Korea that opened opportunities for farmers to export more agriculture products to the two countries. The Kenya-China agreement opened opportunities for Kenya to export meat, flowers, and a selection of fruits and vegetables to China.

Kenyatta’s visit to Mauritius for the deal makes him the first Kenyan president to visit Mauritius.

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