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Is Another ‘Scramble for Africa’ Underway?

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Zambian economy

There is another scramble for Africa according to international media, but this time it is about who can best profit from the continent’s business opportunities. And the charge is being led by foreign powers, with 70% of coverage about business in Africa referencing China, the USA, Russia, France, and the UK, according to the newly launched The Business in Africa Narrative Report, by Africa No Filter and AKAS.

The report shows that the keywords, stories, frames, and narratives associated with business on the continent are dangerously distorted. There is an overemphasis on the role of governments, foreign powers, and larger African states alongside an underappreciation of the role of young people, women, entrepreneurs, creative businesses, smaller successful African states, and Africa’s future potential.

Moky Makura, Executive Director at Africa No Filter, said: “We wanted to understand why Africa is seen as a high-risk business destination and why the cost of money is at a premium. The report gives us an insight into why. It shows that business opportunities on the continent are both underrepresented and misrepresented, and now that we know this, we can work on educating the media and changing the narrative around business in Africa.”

Richard Addy, report author and co-founder of award-winning international audience strategy consultancy, AKAS, added: “This ground-breaking report offers a detailed data analysis on the narrative around business in Africa. This rigorous research is important because narratives, frames and stories are the lenses through which we perceive and experience Africa. They inform beliefs, behavior and ultimately dictate policy.”

In addition to the dominance of foreign powers in business stories featured in international media, the report highlighted a number of other key frames dominating dangerous distortions played out in stories, and the underrepresentation of businesses across the continent, including:

  • More negative coverage: International media are more likely to have a negative tone. African media are twice as likely to reference corruption in their coverage of business in Africa compared to international media, with corruption featuring in 10% of African media stories.
  • Africa is Nigeria and South Africa: Nearly 50% of articles in global media outlets reference South Africa or Nigeria, crowding out business stars like Mauritius, Namibia, and the Seychelles. Mauritius is the highest-ranking African country in the World Economic Forum’s Global Competitiveness Index.
  • Silencing creativity, amplifying technology: Nollywood is the world’s second-largest film industry, and music genres like AfroBeats and AmaPiano are influencing pop culture globally, yet creative businesses were only featured in 1% of all business news articles across African and global media. Additionally, while 22% of Africa’s working-age population started new ventures between 2011 and 2016, the highest rate of any region globally, African start-ups received declined coverage.
  • Youth and women are underrepresented: African countries claim the top three spots in the Mastercard Index for the highest concentration of women business owners globally, but business news and analysis on gender equality issues have declined. Africa also has the youngest population globally. However, youth and women are underrepresented in business stories. In fact, online news coverage of young people has declined between 2017 and 2021. In addition, stories about African youth globally are often framed through negative stereotypes, invoking images of inactivity, violence, and crime.
  • Government, policy, and regulations dominate: 54% of business news in 2021 was framed through government action and policies. Additionally, African media focused more on themes related to government than on those related to entrepreneurship. Yet, African countries make up six of the top 10 countries whose populations were most likely to search for the topic of entrepreneurship in 2021.
  • Missing Free Trade Area and investment: The African Continental Free Trade Area is the largest free trade area in the world by the number of countries taking part, yet it makes up under 1% of business news and analysis while mentions of Foreign Direct Investment fell from 3.2% in 2017 to an even lower 1.9% of coverage in 2021.

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Economy

Nigeria’s Plan to Review Oil Companies’ Gas Flaring Strategies

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Oil

Nigeria is ramping up its efforts to address environmental concerns in the oil and gas sector with a comprehensive plan to review gas flaring strategies of international and indigenous oil companies.

The Minister of State for Environment, Dr. Iziaq Salako, announced this initiative during a national stakeholders engagement meeting on methane mitigation and reduction held in Abuja, Investors King reports.

Gas flaring, a common practice in the oil industry, releases methane—a potent greenhouse gas—into the atmosphere, contributing to climate change and posing health risks to communities near oil facilities.

Nigeria aims to end routine gas flaring by 2030, aligning with global climate goals and commitments.

Dr. Salako explained the importance of reducing methane emissions and highlighted the detrimental effects on public health, food security, and economic development.

He outlined practical steps being taken to tackle methane emissions, including the development of methane guidelines and the engagement of government institutions.

The ministry, through the National Oil Spill Detection and Response Agency, will conduct periodic reviews of oil companies’ plans to ensure compliance with the gas flaring deadline.

Deloitte management consultants will assist in conducting comprehensive forensic audits to scrutinize the legitimacy of forward-contracted transactions.

President Bola Tinubu’s commitment to environmental sustainability underscores the government’s dedication to addressing climate change and fulfilling its multilateral environmental agreements.

The engagement event served as a platform for stakeholders to discuss methane mitigation strategies, existing policies, and implementation challenges.

Collaboration and dialogue among diverse sectors are crucial in charting a unified course towards sustainable methane reduction in Nigeria’s oil and gas industry.

As the country navigates its environmental agenda, ensuring accountability and transparency in gas flaring practices remains paramount for achieving a greener and healthier future.

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Economy

Interest Rate Jumps to 24.75% as CBN Takes Aggressive Stance Against Inflation

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Dr. Olayemi Michael Cardoso

The Central Bank of Nigeria (CBN) has announced a significant increase in the monetary policy rate, known as the interest rate, to 24.75%.

This move disclosed by CBN Governor Olayemi Cardoso during the 294th Meeting of the Monetary Policy Committee press briefing in Abuja, represents a bold step by the apex bank to address the mounting inflationary pressures faced by the country.

With inflation soaring to 31.70% in February, the CBN aims to moderate this upward trend by tightening its monetary policy stance.

This decision follows the previous hike in the interest rate to 22.75% in February, showcasing the CBN’s commitment to combatting inflationary forces.

While the bank opted to maintain the Cash Reserve Ratio at 45%, the significant increase in the interest rate underscores the urgency of the situation and the need for decisive action.

Governor Cardoso emphasized that these measures are essential to stabilize the economy and safeguard the purchasing power of the Nigerian currency.

The 294th MPC marks the second meeting under Governor Cardoso’s leadership, indicating a proactive approach to addressing economic challenges.

The next MPC meeting is scheduled for May 20th and 21st, 2024, highlighting the ongoing commitment of the CBN to navigate Nigeria’s economic landscape amidst inflationary pressures.

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Economy

Nigeria Braces for 10th Consecutive Interest Rate Hike by Central Bank

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Central Bank of Nigeria (CBN)

As Nigeria grapples with persistently high inflation, the Central Bank of Nigeria (CBN) is gearing up to implement its tenth consecutive interest rate hike in a bid to curb the soaring prices and attract investment.

Analysts surveyed by Bloomberg are anticipating a substantial 125 basis-point increase in the key rate to 24%, marking one of the most significant adjustments in the current tightening cycle.

The decision, expected to be announced by Governor Olayemi Cardoso on Tuesday at 2 p.m. in Abuja, comes on the heels of inflation accelerating to 31.7% in February, far surpassing the central bank’s target range of 9%.

This surge has been primarily attributed to the sharp depreciation of the naira, prompting authorities to devalue the currency twice since June to narrow the gap with the unofficial market rate and encourage investor confidence.

While these measures have seen the naira strengthen in recent days and bolstered investment inflows, including a fourfold increase in overseas remittances and significant foreign investor portfolio asset purchases, there remains a palpable need for more decisive action.

Giulia Pellegrini, a senior portfolio manager at Allianz Global Investors, emphasized the necessity for the CBN to intensify its tightening efforts to regain foreign investors’ confidence in the local bond market.

While acknowledging the positive strides made by the central bank, Pellegrini stressed the importance of a more assertive approach to prevent the diversion of investor attention to other frontier markets.

As the Nigerian economy navigates through these challenging times, the impending interest rate hike signals the CBN’s determination to address inflation head-on and foster a more stable economic environment.

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