African Development Bank is delivering for Africa: Adesina
In an impassioned speech delivered at the Center for Global Development in Washington, DC, on Wednesday, April 19, African Development Bank President Akinwumi Adesina spoke about Africa’s enormous potential, and the Bank’s ambitious development agenda, which he said was well underway.
The Washington think tank was an apt venue for Adesina to take stock of his first 19 months in office. Two years earlier, on April 16, 2015, the then Nigerian Minister of Agriculture and Rural Development participated in a debate in that same room with other candidates vying for the AfDB Presidency ahead of the Bank’s Presidential elections in May 2015.
“Africa was in the limelight for a very good reason,” Adesina said ahead of a panel discussion on “The Challenge and Logic of Greater Financing for Africa” on the sidelines of the World Bank-IMF Spring Meetings. “The African Development Bank set the leadership tone for all MDBs for the transparency in electing its President through an open and competitive process,” he added, referring to the Bank’s live-tweeting of the election results.
Two years on, Adesina told the packed room that the vision he outlined in his inaugural speech, the five development priorities known as the High 5s, are being rolled out across the continent. “Our vision for Africa at the Bank is encapsulated in the High 5s: Light up and power Africa; Feed Africa; Industrialize Africa; Integrate Africa; and Improve the quality of life for the people of Africa,” Adesina said, enumerating an impressive list of initiatives the Bank is undertaking.
“We launched the New Deal on Energy for Africa, with a commitment of $12 billion from the Bank over the next five years, with the goal of leveraging $45-50 billion. Our goal is connect 130 million people to the grid, 75 million via off grids and provide some 150 million with clean cooking energy.
“We’ve set up a whole new Vice Presidency just for Power and Energy: the first and only Multilateral Development Bank to do so. Last year, we financed $1.7 billion in the power sector across 19 countries, and will increase this to $2 billion this year, leveraging $5-7 billion. We’ve launched a $500 million Fund for Energy Inclusion with $100 million seed capital, to provide affordable finance for companies investing in renewable energy.
“Just as electricity powers an economy, so does food provide energy for people. Africa’s annual food import bill of $35 billion, estimated to rise to $110 billion by 2025, weakens African economies, decimates its agriculture and exports jobs from the continent,” Adesina said, noting that $35 billion is just about what the continent needs to close its power deficit.
“To rapidly support Africa to diversify its economies, and revive its rural areas, we have prioritized agriculture,” he continued. “The Bank has committed $24 billion towards agriculture in the next 10 years, with a sharp focus on food self-sufficiency and agricultural industrialization. The recent drought and famine facing some countries (South Sudan, Somalia, Nigeria, Kenya, Ethiopia and Uganda) deserve swift action, as 20 million face food insecurity and severe malnutrition. The Bank is taking action and is planning to deploy $1.1 billion, following Board approval, to address the crisis and ensure that drought does not lead to famine.
“We’re taking action to level the playing field for women in Africa. That’s why we launched the Affirmative Finance Action for Women in Africa (AFAWA) with the goal of mobilizing $3 billion for women entrepreneurs. “We’ve taken on the biggest social issue facing Africa today: the high youth unemployment rates. Today, a third of Africa’s 230 million youths (about 20% of the global youth population) are unemployed or discouraged, another 1/3 are in vulnerable employment largely in the informal sector while only 1/6 are in wage employment.”
To tackle that problem, the AfDB has launched the Empowering Novel Agri-Business-Led Employment (ENABLE) Youth initiative for young ‘Agripreneurs’ in several countries, including Nigeria and Sudan. It has also partnered with the European Investment Bank to launch the Boost Africa initiative for young innovative entrepreneurs, and is investing in training for young people in science, technology and math to prepare them for the jobs of the future.
“Our vision for Africa is clear,” said Adesina as he outlining some of the institution’s successes in 2016:
• 3.3 million Africans benefitted from new electricity connections;
• 3.7 million Africans benefited from improved access to water and sanitation;
• 5.7 million Africans benefitted from improvements to agriculture;
• 9.3 million Africans benefitted from access to better health care services;
• 7 million Africans benefitted from improved access to transport.
“The African Development Bank is delivering for Africa and it has the capacity to deliver more for Africa,” Adesina said. “It now needs substantial financing wind behind its sails. It’s time for speedy financing actions to accelerate Africa’s development.”
Business
LLR transforms from Company to Group reporting
Botswana Stock Exchange listed diversified real estate company, Letlole La Rona Limited (“LLR” or “the Company” or “the Group”), posted its first set of group financial statements which comprise the Company and Group consolidated accounts, which show strong financial performance for the six months ended 31 December 2023, with improvements across all key metrics.
The Company commenced the financial year with the appointment of a Deputy Chairperson, Mr Mooketsi Maphane, in order to bolster its governance and enhance leadership continuity through the development of a Board and Executive Management Succession Plan.
At operational level, LLR increased its shareholding in Railpark Mall from 32.79% to 57.79% and proudly took over the management of this prime asset.
The CEO of LLR, Ms Kamogelo Mowaneng commented “During the period under review, our portfolio continued to perform strongly, with improvements across all key metrics as a result of our ongoing focus on portfolio growth and optimisation.
“We are pleased to report a successful first half of the 2024 financial year, where we managed to not only grow the portfolio through strategic acquisitions and value accretive refurbishments but also recycled capital through the disposal of Moedi House as well as the ongoing sale of section titles at Red Square Apartments. The acquisition of an additional 25% stake in JTTM Properties significantly uplifted the value of our investment portfolio to P2.0 billion at a Group level. Our investment portfolio was further differentiated by the quality of our tenant base, as demonstrated by above market occupancy levels of 99.15% and strong collections of above 100% for the period”.
The growth in contractual revenue of 9% from the prior year’s P48.0 million to the current year P52.2 million, increased income from Railpark Mall, coupled with high collection rates, has enabled the company to declare a distribution of 9.11 thebe per linked unit, which is in line with the prior year.
In line with its strategic pillars of ‘Streamlined and Expanded Botswana Portfolio’ as well as ‘Quality African Assets’, the Group continuously monitors the performance of its investments to ensure that they meet the targeted returns.
“The Group continues to explore yield accretive opportunities for balance sheet growth and funding options that can be deployed to finance that growth” further commented the CEO of LLR Ms Kamogelo Mowaneng.
Ms Mowaneng further thanked the Group’s stakeholders for their continued support and stated that they look forward to unlocking further value in the Group.
Business
Botswana’s Electricity Generation Dips 26.4%
The Botswana Power Corporation (BPC) has reported a significant decrease in electricity generation for the fourth quarter of 2023, with output plummeting by 26.4%. This decline is primarily attributed to operational difficulties at the Morupule B power plant, as per the latest Botswana Index of Electricity Generation (IEG) released recently.
Local electricity production saw a drastic reduction, falling from 889,535 MWH in the third quarter of 2023 to 654,312 MWH in the period under review. This substantial decrease is largely due to the operational challenges at the Morupule B power plant. Consequently, the need for imported electricity surged by 35.6% (136,243 MWH) from 382,426 MWH in the third quarter to 518,669 MWH in the fourth quarter. This increase was necessitated by the need to compensate for the shortfall in locally generated electricity.
Zambia Electricity Supply Corporation Limited (ZESCO) was the principal supplier of imported electricity, accounting for 43.1% of total electricity imports during the fourth quarter of 2023. Eskom followed with 21.8%, while the remaining 12.1, 10.3, 8.6, and 4.2% were sourced from Electricidade de Mozambique (EDM), Southern African Power Pool (SAPP), Nampower, and Cross-border electricity markets, respectively. Cross-border electricity markets involve the supply of electricity to towns and villages along the border from neighboring countries such as Namibia and Zambia.
Distributed electricity exhibited a decrease of 7.8% (98,980 MWH), dropping from 1,271,961 MWH in the third quarter of 2023 to 1,172,981 MWH in the review quarter.
Electricity generated locally contributed 55.8% to the electricity distributed during the fourth quarter of 2023, a decrease from the 74.5% contribution in the same quarter of the previous year. This signifies a decrease of 18.7 percentage points. The quarter-on-quarter comparison shows that the contribution of locally generated electricity to the distributed electricity fell by 14.2 percentage points, from 69.9% in the third quarter of 2023 to 55.8% in the fourth quarter. The Morupule A and B power stations accounted for 90.4% of the electricity generated during the fourth quarter of 2023, while Matshelagabedi and Orapa emergency power plants contributed the remaining 5.9 and 3.7% respectively.
The year-on-year analysis reveals some improvement in local electricity generation. The year-on-year perspective shows that the amount of distributed electricity increased by 8.2% (88,781 MWH), from 1,084,200 MWH in the fourth quarter of 2022 to 1,172,981 MWH in the current quarter. The trend of the Index of Electricity Generation from the first quarter of 2013 to the fourth quarter of 2023 indicates an improvement in local electricity generation, despite fluctuations.
The year-on-year analysis also reveals a downward trend in the physical volume of imported electricity. The trend in the physical volume of imported electricity from the first quarter of 2013 to the fourth quarter of 2023 shows a downward trend, indicating the country’s continued effort to generate adequate electricity to meet domestic demand, has led to the decreased reliance on electricity imports.
In response to the need to increase local generation and reduce power imports, the government has initiated a new National Energy Policy. This policy is aimed at guiding the management and development of Botswana’s energy sector and encouraging investment in new and renewable energy. In the policy document, Minister of Mineral Resources, Green Technology and Energy Security Lefoko Moagi stated that the policy aims to transform Botswana from being a net energy importer to a self-sufficient nation with surplus energy for export into the region. Moagi expressed confidence that Botswana has the potential to achieve self-sufficiency in electric power supply, given the country’s readily available energy resources such as coal and renewable sources.
Business
MMG acquires Khoemacau in a transaction valued at P23Bn
MMG Limited, the Hong Kong-based mining company specializing in base metals, has successfully concluded the acquisition of Khoemacau Copper Mine, a state-of-the-art, world-class copper asset nestled in the northwest of Botswana.
On Monday, MMG announced that the acquisition of Khoemacau Mine in Botswana was finalized on 22nd March 2024. “This acquisition enriches the company’s portfolio with a top-tier, transformative growth project and signifies a monumental milestone in the Company’s journey,” MMG communicated in an official statement published on the Hong Kong Stock Exchange.
Upon completion of the acquisition, MMG remitted to the Sellers an Aggregate Consideration of approximately US$1,734,657,000 (over P23 billion), a sum subject to potential adjustments post-Completion.
In addition to the Aggregate Consideration, MMG, in accordance with the Agreement, advanced an aggregate amount of approximately US$348,580,000 (over P4.5 billion) as the Aggregate Debt Settlement Amount, to settle certain debt balances of the Target Group (Cuprous Capital/Khoemacau).
On November 21, 2023, Khoemacau announced that the shareholders of its parent company [Cuprous Capital] had agreed to sell 100% of their interests to MMG Limited.
MMG is a global resources company that mines, explores, and develops copper and other base metals projects on four continents. The company is headquartered in Melbourne, Australia, and has a significant shareholder, China Minmetals Corporation, which is China’s largest metals and minerals group owned by the Government of the People’s Republic of China.
On December 22, 2023, Khoemacau Copper Mining (Pty) Ltd received the approval from the Minister of Minerals and Energy of Botswana regarding the transfer of a controlling interest in the Project Licenses and Prospecting Licenses associated with the Khoemacau Copper Mine, a result of the Acquisition.
The Botswana Competition & Consumer Authority (CCA) on January 29, 2024, notified the market that it had given its approval for the takeover of Khoemacau Copper Mining by MMG Limited.
On January 29, 2024, the CCA issued a merger decision to the market, stating that after conducting all necessary assessments, it was ready to proceed.
The Competition Authority affirmed that the structure of the relevant market would not significantly change upon implementation of the proposed merger as the proposed transaction is not likely to result in a substantial lessening of competition, nor endanger the continuity of service in the market of mining of copper and silver ores and the production, and sale or supply of copper concentrate in Botswana.
Furthermore, the CCA stated that the proposed merger would not have any negative impact on public interest matters in Botswana as per the provisions of section 52(2) of the Competition Act 2018.
Earlier this month, Minister of Minerals & Energy, Lefoko Maxwell Moagi, informed parliament that his Ministry was endorsing the Khoemacau acquisition by MMG Limited. He noted that not only was the company acquiring the existing operation but also committing to an expansion program that would cost over $700 million to double production, create more jobs for Batswana, and increase taxes and royalties paid to the Government.