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Pervasive Negative Narrative is Africa’s Greatest Challenge

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Tony Elumelu
  • Pervasive Negative Narrative is Africa’s Greatest Challenge

The Chairman of Heirs Holdings, Mr. Tony Elumelu has identified the pervasive stereotypes in the media around Africa and the resulting negative narrative as “Africa’s greatest challenge.”

Elumelu, who spoke at a gathering of senior policymakers and developments experts hosted by UK’s leading foreign policy institute, spoke on a panel alongside United Kingdom Minister of State, Department for International Development (DFID), Rory Stewart.

“I believe that the greatest challenge Africa has as a continent when it comes to attracting investment is in the way it is portrayed. Information presented about Africa is neither holistic nor properly contextualised, and has led to the kind of narrative that we have had for so long on Africa.

“As an investor, when all you have heard about Africa is corruption, how would you pass a positive investment decision to go and invest in the continent? The result is that the vicious cycle of neglect continues and is even reinforced,” he added.

Elumelu, who is the chairman of the United Bank for Africa Plc, therefore called for an urgent “reset of mindset,” to attract the level of global private capital that would drive job creation and reduce poverty on the continent.

“We must reset the way we see and discuss Africa. People do business with people they are comfortable with. Investors who repeatedly hear horrible things about our people and the continent will never invest here.

“We will continue to host national gatherings and seminars to discuss unemployment, poverty and income inequality if we do not fix the existing information asymmetry, the poor quality of information that is put out,” he added.

The Founder of the Tony Elumelu Foundation also rallied public and private sector stakeholders and the development world to increase support to African SMEs, describing them as “the lifeblood of our economy”.

Elumelu, who had committed $100m to African entrepreneurs, emphasised the critical importance of mentoring and funding for the survival of small businesses.

In a continent where only 700 companies generate over $500m in annual revenue, half the number in other regions, he called for targeted support to grow these small businesses into scalable companies capable of becoming big corporates in the future.

According to Elumelu, SMEs are known to be the largest job creators and should be prioritized because of the inverse relationship between security and prosperity – “when there is prosperity, security is not an issue, but when there are fewer jobs, insecurity heightens.”

Elumelu called on local and foreign investors to invest in electricity, stating that this more than any other investment “will encourage the creation and growth of businesses of scale in Africa.” According to him, “long term private investment in electricity infrastructure will create an enabling environment for business growth.”

Also at the event, a new Chatham House report, “Developing Businesses of Scale in Sub-Saharan Africa” which referenced Elumelu’s economic philosophy of ‘Africapitalism’ was launched. Africapitalism calls on the private sector to invest in strategic sectors for the long term to transform the continent. The report outlined the policy issues Africa must address to support the private sector to enhance job creation, encourage innovation and drive industrialisation.

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Guinness Nigeria Postpones Spirits Importation Exit, Extends Deal with Diageo

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Guinness - Investors King

Guinness Nigeria Plc has announced a delay in its plan to halt the importation of spirits as it extended its agreement with multinational alcoholic beverage company Diageo until 2025.

The decision, communicated through a corporate notice filed with the Nigerian Exchange Limited on Tuesday, cited a longer-than-expected transition period for separating its business from Diageo’s.

Initially slated for discontinuation in April 2024, the importation of premium spirits like Johnnie Walker, Singleton, Baileys, and others under the 2016 sale and distribution agreement with Diageo will now continue for an additional year.

The extension comes as the process of business separation between Guinness Nigeria, a subsidiary of Diageo, and Diageo itself faces unexpected delays.

In October, Guinness Nigeria had announced plans to cease importing spirits from Diageo, a move aimed at reducing its foreign exchange requirements.

However, the separation process has encountered unforeseen hurdles, necessitating the extension of the importation agreement.

The notice, signed by the company’s Legal Director/Company Secretary, Abidemi Ademola, highlighted the ongoing efforts by Guinness Nigeria and Diageo to implement the separation, originally scheduled for completion by April 2024.

The extension underscores the complexity of disentangling the businesses and ensuring a smooth transition.

Guinness Nigeria reaffirmed its commitment to the long-term growth strategy, aligning with Diageo’s decision to establish a new, wholly-owned spirits-focused business.

Despite the delay, both companies remain dedicated to managing the importation and distribution of international premium spirits in West and Central Africa, with Nigeria as a key hub.

The postponement comes amid challenges faced by Guinness Nigeria, including significant exchange rate losses, which amounted to N49 billion in the 2023 half-year operations.

Despite these setbacks, the company remains optimistic about its future prospects in the Nigerian market.

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Private Sector Warns: Interest Rate Hike to Trigger Job Cuts and Inflation Surge

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Private employers

As the Central Bank of Nigeria (CBN) announced a hike in the Monetary Policy Rate (MPR) from 22.75% to 24.75%, concerns have been raised by the private sector regarding the potential ramifications on job stability and inflationary pressures.

The move, aimed at curbing inflation and stabilizing the exchange rate, has prompted apprehension among business operators who fear adverse effects on the economy.

Representatives from the Nigerian Association of Chambers of Commerce, Industry, Mines and Agriculture (NACCIMA) and the Nigerian Association of Small Scale Industrialists have voiced their worries over the increased difficulty in accessing affordable credit.

They argue that the higher interest rates will impede the private sector’s ability to borrow funds for expansion and operational activities.

This, they fear, could lead to a reduction in business investments and subsequently result in widespread job cuts across various sectors.

The Lagos Chamber of Commerce and Industry (LCCI) acknowledged the necessity of the interest rate hike but emphasized the potential negative consequences it may bring.

While describing it as a “price businesses would have to pay,” the LCCI highlighted the current fragility of the economy, exacerbated by various policy missteps.

They cautioned that the increased cost of borrowing could stifle entrepreneurial activities and discourage expansion plans critical for economic growth and job creation.

Experts have echoed these concerns, warning that the tightening monetary conditions could exacerbate inflationary pressures and hinder economic recovery efforts.

With inflation already soaring at 31.70%, the rate hike could further fuel price hikes, especially in essential goods and services, thus eroding the purchasing power of consumers.

However, CBN Governor Yemi Cardoso defended the decision, citing the imperative to address current inflationary pressures and ensure sustained exchange rate stability.

He emphasized the need to restore the purchasing power of ordinary Nigerians and expressed confidence that the economy would stabilize by the end of the year.

Despite assurances from the CBN, stakeholders remain cautious, calling for a more nuanced approach that balances the need for price stability with the imperative of fostering economic growth and job creation.

As businesses brace for the impact of the interest rate hike, all eyes are on the evolving economic landscape and the measures taken to mitigate its effects on livelihoods and inflation.

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Breaking Barriers: Transcorp Hotels CEO Shares Journey from Crisis to Success

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Dupe Olusola

Dupe Olusola, the Managing Director/CEO of Transcorp Hotels Plc, reflects on her remarkable journey from navigating the depths of a global pandemic to achieving unprecedented success in the hospitality industry.

Appointed in March 2020, amidst the onset of the COVID-19 pandemic, Olusola found herself at the helm of a company grappling with the severe economic fallout and operational challenges inflicted by the crisis.

Faced with a drop in occupancy rates from 70% to a mere 5%, Olusola and her team were confronted with the daunting task of steering Transcorp Hotels through uncharted waters.

Undeterred by the adversity, they embarked on a journey of transformation, leveraging creativity and resilience to navigate the turbulent landscape.

Implementing innovative strategies such as introducing drive-through cinemas, setting up on-site COVID-19 testing facilities, and enhancing take-away services, Transcorp Hotels adapted to meet the evolving needs of its guests and ensure continuity amidst the crisis.

Embracing disruption as a catalyst for growth, Olusola fostered a culture of collaboration and teamwork, rallying her colleagues to overcome obstacles and embrace change.

Through unwavering determination and a commitment to excellence, Transcorp Hotels emerged from the pandemic stronger than ever, breaking profit and revenue records year after year.

“It’s indeed been a great opportunity to learn and relearn, to lead and to grow. When you see success stories, remember it’s a journey with twists, turns, ups and downs but in the end, it will all be okay”, she said.

Olusola’s leadership exemplifies the power of adaptability and perseverance, inspiring her team to transcend limitations and chart a course towards unprecedented success.

As Transcorp Hotels continues to flourish under her stewardship, Olusola remains steadfast in her dedication to driving innovation, fostering growth, and breaking barriers in the hospitality industry.

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