Africa

🇳🇪 West African heads of state officially recognized Niger’s ruling junta, but demanded a short period of transition toward civilian rule to ease economic sanctions. The resolution was made on Sunday, during the West African regional bloc’s summit in Nigeria’s capital Abuja. The leaders agreed that a heads-of-state group from Benin, Togo and Sierra Leone would engage with Niger’s leadership to agree on conditions for lifting sanctions. Recognition of the junta by the bloc has ended hopes that Niger’s elected president Mohamed Bazoum would be reinstated. The leaders requested the immediate release of Bazoum, who has been detained since the coup in July.

🇪🇹 Ethiopia is on track to join Zambia and Ghana as a sovereign defaulter after it failed to pay its bond coupon that was due yesterday. The finance ministry said last Friday that it had communicated to a group of bondholders that it could not pay the $33 million coupon due to its low foreign-exchange reserves which had impacted its ability to service external debts. The government will be deemed to have defaulted if a 14-day grace period expires without payments. A minister told Reuters there would be a call with investors holding the international bond on Thursday, Dec. 14.

🇳🇬 The Dangote Petroleum Refinery, a new plant belonging to Africa’s richest man, said it has bought a million barrels of crude oil as it plans to begin producing refined fuel. It is the first crude cargo received by the refinery, located on the outskirts of Lagos, since it was inaugurated in May. The company, in a statement, said it expects to refine 350,000 barrels of crude oil a day and will receive four cargoes of a million barrels each from Nigeria’s state-run oil company NNPC in two to three weeks. “Our focus over the coming months is to ramp up the refinery to its full capacity,” Aliko Dangote said in the statement.

🇬🇭 A Belgian woman who is a spokesperson for Ghana’s The New Force, the group behind a masked man widely expected to launch a bid for the presidency, was arrested and charged over alleged immigration irregularities. Shalimar Abbiusi, who appeared in a promotional video launching the group, pleaded not guilty. She was granted bail yesterday. The New Force issued a statement in which it said its spokesperson was questioned about the group, its backers and a potential presidential election bid. It said the “arbitrary detention” of its spokesperson “raises serious concerns about the abuse of power, persecution of perceived political opponents and several human rights violations.”

🌍 Nigerian football star Victor Osimhen was named the 2023 African Footballer of the Year at the Confederation of African Football (CAF) awards ceremony in Marrakech, Morocco. The striker, who plays for the Italian club Napoli, beat Egypt’s Mohamed Salah and Morocco’s Achraf Hakimi to the award. He scored 26 times in 32 appearances, including the goal that won Napoli their first Serie A title in 33 years. Asisat Oshoala, also a Nigerian striker, was named the CAF Women’s Player of the Year for a record sixth time. The striker was central to Barcelona’s entry into the Champions League after scoring 27 goals across all competitions.

The estimated amount African countries will lose each year to a new carbon tax by the European Union, according to the African Development Bank (AfDB). The Carbon Border Adjustment Mechanism (CBAM) is a tariff on carbon intensive products imported into the EU. AfDB President Akinwumi Adesina warned on the sidelines of COP28 that the mechanism would hurt value-added exports from Africa, including steel, cement, iron and fertilizers. He added that African countries would be forced to remain exporters of raw commodities rather than developing their manufacturing base. Set to take effect in 2026, the mechanism entered its transitional phase in October.

Why consumer goods multinationals are fleeing Nigeria

THE NEWS

LAGOS — Multinational companies are cutting back their presence in Nigeria or pulling out altogether as currency problems hamper their operations and hurt consumers.

Procter & Gamble, an Ohio-based consumer goods giant, last week became the latest big company to scale down its operations. It said it will stop producing its care and hygiene products in the continent’s most populous country.

P&G’s chief financial officer Andre Schuten said tough macroeconomic conditions, particularly the local naira currency’s weakness, is driving the shift. Nigeria is “very difficult for us as a U.S. dollar-denominated company to create value” in, Schuten said at Morgan Stanley’s Global Consumer and Retail Conference, an investor event in New York.

British multinationals GSK and Unilever are two other high profile consumer goods companies to have announced changes to their Nigeria operations this year. Each signaled forex pressures as fueling decisions to shift to a third party distributor model (in GSK’s case) or retire the production of well-known products (as Unilever announced in March). In September, another British group, PZ Cussons, said “foreign exchange challenges” was causing it to delist from the Nigerian stock market.

“Nigeria is a $50 million net sales business,” Schuten said, “a really small” market in the context of the company’s global net sales of $85 billion. P&G products, like diaper brand Pampers and laundry powder Ariel, will now be available in Nigeria on an import-only basis.

KNOW MORE

Nigeria’s naira has weakened sharply against the dollar since President Bola Tinubu initiated reforms in June to cancel fixed exchange rates while inflation reached an 18-year high in July, rising to 27.33% in October.

But even before Tinubu’s term, many of the largest companies in Nigeria, from cement producer Dangote to telecoms leader MTN, reported that the macroeconomic conditions had hit their earnings. New York-listed e-retailer Jumia and venture capital-funded startups that report earnings in dollars have noted similar challenges this year.

P&G began doing business in Nigeria in 1992 with production centered in two plants located in towns close to Lagos. In 2017 it opened a multimillion-dollar baby care products manufacturing plant but it was shuttered a year later in a “restructuring” attempt aimed at efficiency and sustainability due to difficulties in sourcing inputs.

Nigeria’s central bank governor, Yemi Cardoso, in a recent speech on his policy approach, said low forex inflows from declining oil revenues was a major cause of the country’s challenges, though he blamed the dollar’s strength and inflation in emerging markets on the effects of the war in Ukraine and the COVID-19 pandemic. He said the bank has taken actions over the past two months to achieve price stability, including a 108 billion naira ($136 million) sale of treasury bills. His response to industry concern around postponed monetary policy meetings was that the bank has fulfilled legal requirements to meet at least four times a year and was, in any case, reviewing the meetings’ value for efficiency.

Agric-tech startups make up the majority of climate resilience and adaptation solution providers in Africa, according to an analysis by investment firm Catalyst Fund of 262 investment pitch decks it received since January from pre-seed stage startups. However, nearly 75% of funding since 2019 in the climate-tech sector in Africa has been in energy and water solutions. About $3.4 billion has been invested in the African climate-tech ecosystem since 2019, but it’s only just over half of funding to fintech, according to researchers who track the data. Africa’s annual climate adaptation funding gap of $40 billion is driven mostly by weak private sector participation, the Global Center on Adaptation says.

Africa’s vaccines

→ What’s happening? Up to $1 billion will be allocated to boost vaccine manufacturing in Africa under a new scheme set up by Gavi, a vaccine alliance. The aim of the African Vaccine Manufacturing Accelerator is to increase local production of vaccines.

Under the initiative, announced last week and due to be launched in June 2024, the African accelerator will pay manufacturers if their vaccines are approved by the World Health Organization. It would enable African countries to choose shots made on the continent for the same as it would cost to import from outside the continent.

→ Why are they doing this? The COVID-19 pandemic highlighted inequalities in access to vaccines and the lack of manufacturing facilities in African countries. The African Union has targeted African manufacturers supplying more than 60% of the continent’s vaccines by 2040 — up from about 1% now.

→ What about efforts to combat malaria? In October, the World Health Organization (WHO) recommended a second malaria vaccine. The mosquito-borne disease kills more than 600,000 people every year, most of whom are children in Africa. The R21/Matrix-M — which had already been approved for use in Ghana, Nigeria and Burkina Faso — will be rolled out in those countries early next year, with doses expected to cost from $2 to $4 .The first malaria vaccine — Mosquirix, or RTS,S, from British drugmaker GSK — was approved by the WHO in 2021. It had been rolled out since 2019 in pilot programmes in Ghana, Malawi and Kenya.

→ What’s next for the Malaria fight? Health campaigners have warned that the supply of malaria vaccines is outstripped by demand, accusing the WHO of a lack of urgency in rolling out malaria shots.

Dr Patrick Aboagye, director general of the Ghana Health Service, told Semafor Africa that from early 2024 Ghana would move from a malaria “control phase” to “elimination phase”, which means stopping the local transmission of the disease altogether rather than merely reducing the number of cases to low levels. He also said the country had “seen a massive reduction in the malaria case load and malaria fatality has gone down” since RTS,S was first piloted four years ago.

Halidou Tinto, a global health scientist who worked on clinical trials for the R21 vaccine, told Semafor Africa “the manufacturing capacity of RTS,S is very limited if you consider the high demand of endemic countries.” He went on: “Having R21 coming on board in 2024 is very important as this will complement the missing doses that RTS,S will not be able to cover.”

— Alexis Akwagyiram

Today, Dec. 12, Kenya marks 60 years since it became a republic. Dr. Paul Abiero is a professor of history at Moi University in Eldoret, Kenya. He covers economic integration and democracy and its challenges in East African states.

Fashion designers, stylists and fans from across Senegal, Angola, Côte d’Ivoire, South Africa, and Congo gathered in Senegal’s capital for the 21st edition of the Dakar Fashion Week which closed on Sunday. This year’s edition, according to the event’s founder Adama Amanda Ndiaye, focused on the theme of sustainability, in which fashion designers used the platform to showcase, promote and celebrate African creativity in fashion, all while creating awareness about environmental conservation.

• COP28’s fossil fuel phase out has been phased out. The summit’s most controversial element was axed in a draft agreement — but the fight isn’t over yet.
• Ukrainian President Zelenskyy will visit the White House and meet with Congressional leaders as U.S. lawmakers consider a $60 billion aid package for Kyiv.
• One of the most highly trafficked financial news sites is creating AI-generated stories that bear an uncanny resemblance to articles published by competitors.

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Happy 60th jamhuri (republic) day to the people of Kenya!! 🇰🇪

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— Yinka, Alexis, Alexander Onukwue, Martin Siele, and Muchira Gachenge