News - Afrikan Heroes

Nigerian government urged to deregulate the downstream petroleum sector in a sustainable manner

September 24, 2020

The federal government has been urged to embark on the deregulation of the country’s downstream petroleum sector in a manner that is sustainable. The call was made by a consortium of Civil Society Organizations (CSOs) requesting the government to entrench the deregulation drive of the downstream sector of the petroleum industry by enacting an appropriate legislation or embedding it as part of the Petroleum Industry Bill (PIB) expected to be submitted to the National Assembly soon. The consortium also demanded that the government commences moves to repeal the laws establishing the Petroleum Equalization Fund and the Petroleum Products Pricing and Regulatory Agency (PPPRA) to signal its commitment to the full deregulation of the sub-sector.

The group arrived at this decision at the end of a one-day webinar held within the week demanding from the relevant authorities, especially the Central Bank of Nigeria (CBN) to ensure a level-playing field for all importers of Premium Motor Spirit and not place the Nigeria National Petroleum Corporation (NNPC) at an advantage over others. They equally called on the national oil company to “take urgent practical steps to reverse the fortunes of the loss making refineries as revealed in its published 2018 Audited Reports of its Subsidiaries,” noting that “the refineries remain cost centers that the Nigerian government can ill afford given the impact of Covid-19 pandemic and other fiscal pressures on the economy.

The group urged the government to create an enabling environment for the private sector to contribute to the efficient running of the refineries so that Nigerian can reach its domestic refining goals.” The group further called on the President and the Minister of Petroleum Resources to “demonstrate his honest commitment to the deregulation efforts by expunging the laws that entrench the potential of returning to a subsidy regime and pre-deregulation state,” adding that: “the government repeal the PPPRA Act, the PEF(M)B Act and the Price Control Act specifically, section 6(1) of the Petroleum Act, Schedule 1 of the Price Control Act, all acts that ensure a potential of returning to a price fixing regime and demonstrate to the Nigerian people that the ‘declaration of full deregulation’ is merely a statement of intent and not yet honored.”

According to them, there is need for the Federal Government to “commit to the sustainability of the deregulation regime by entreating it in law, either through a stand-alone legislation, or through appropriate clauses integrated into the Petroleum Industry Bill (PIB) will allow for the sustainability of the no-subsidy regime. “While we await appropriate legislation, we require the government to clarify the role of the Petroleum Support Fund in the new deregulation regime. Clarity is required about how that fund is being managed, whether the over-recovery sums was deposited there and how they are expected to be spent.” It also urged the Ministry of Petroleum Resources to “back up its deregulation policy statement by empowering appropriate agencies including the Federal Competition and Consumer Council to take over the consumer protection interests of Nigerians that may be adversely taken advantage of in a deregulated downstream sector to protect the interests of the people would not suffer exploitation in the hands of profiteering marketers.”

On the issue of ameliorating the immediate effects of the removal of petrol subsidy, the group entreated the government “channel the revenues used for subsidy to improve the lives of its originally intended beneficiaries; impoverished Nigerians and not the rich, by investing in enablers of economic growth and development such as development of rural roads, education, health services and agriculture.” According to the group, “if the NNPC must remain a player in the market, it must strive to operate under the same conditions and rules as other players in the sector regulated only by the prevailing market forces and competition.” While commending the government for “providing initial regulation to support the deregulation efforts in June 2020,” the CSOs noted that the “government’s engagement with the public on the effects of the deregulation leave a lot to be desired.

“We encourage the government to ramp up its engagements with the public to improve their awareness and understanding of the deregulation process and all it portends for the Nigerian people.” Recall that it had earlier issued a 10-point recommendation in May 2020 in a bid to support the government’s attempt to achieve sustainable deregulation of the downstream sector. The consortium which was formed in April 2020 and spearheaded by the Nigeria Natural Resource Charter (NNRC) comprised of the following civil society organizations: Civil Society Legislative Advocacy Centre (CISLAC), BudgIT, Connected Development (CODE), Media Initiative for Transparency in Extractive Industries (MITEI), OrderPaper Advocacy Initiative, Women in Extractives (WiE), Extractive 360, Centre for the Study of the Economies of Africa (CSEA), Youth Forum on Extractive Industry Transparency Initiative (Youth Forum on EITI), Publish What You Pay (PWYP), Africa Network for Environment and Economic Justice (ANEEJ), African Centre for Leadership Strategy and Development (CentreLSD), Centre for Development Support Initiatives (CEDSI), Centre for Transparency Advocacy (CTA) and Koyenum Immalah Foundation (KIF).

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

MTN Ghana to Become a Fully Digital Operator by 2023

September 23, 2020

MTN Ghana has revealed that it is investing in becoming a fully digital operator by 2023. This was made known by Selorm Adadevoh, MTN Ghana CEO, who noted that the company was leveraging the strength of its “fintech” and some six pillars to “deliver a bold new digital world to customers”. The telco said that the COVID-19 pandemic has heightened the importance of digital operations and “MTN is transforming by expanding the mobile money (MoMo) ecosystem”.

MTN has introduced a month-to-month payment option that aims to give customers “control of their spend commitments”. With no lock-ins, no credit checks and no complicated paperwork, MTN Month-to-Month is available to anyone that either doesn’t want to be tied to a contract or who is unable to get a long-term contract due to not meeting minimum requirements.

New or existing customers simply need to choose the package they want and opt for the month-to-month payment option, allowing them to experience the MTN network without a 24-month obligation. All they will be asked for is their name, SA ID and debit order details should they opt to pay via debit order.

“These are uncertain times for many, so with this product, we are responding to our customer’s needs with greater flexibility, as not everyone can afford the commitment of a fixed contract. We developed this offer with freelancers, entrepreneurs, independent contractors and part-time temporary workers, who live from contract to contract, in mind and we hope it can help alleviate some of the pressure being felt by so many right now, ” says Jacqui O’Sullivan, Executive Head of Corporate Affairs, MTN South Africa.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Ukheshe Africa Restructures its Management

Ukheshe, the South African micro transaction platform that allows customers to pay and get paid has undergone a series of management restructuring. The firm announced the appointment of Victor Ndlovu as its new Vice President for Africa and Paul Opie as Head of Issuing for Ukheshe Africa. Both appointments come as the fintech innovator continues to branch out from its South African roots into Africa. Joining Ukheshe from Wirecard South Africa, where he was responsible for driving regional business development, Opie says he is looking forward to working on local solutions that meet local market requirements and expanding them more broadly.

Victor Ndlovu, new Vice President for Africa

“The challenges in the African payment industry as well as current global trends presents an opportunity for us to provide cost-effective payment acceptance infrastructure, such as QR code or mobile, rather than POS. Increase in acceptance creates trust and limits the want to withdraw cash from ATM. Low-cost acceptance, transacting and open-loop interoperability for local use and international e-commerce is a true opportunity for Ukheshe.”

According to the most recent Banking in Africa report, African banking groups are still emphasising investment on e-banking and mobile banking services. Some groups are also deploying or planning the development of fintech, with a focus on facilitating mobile money, electronic transfers and back-office operations. In addition, a fair proportion of banking groups surveyed for the report are also investing in lending-related fintech, including data analytics and blockchain technology.

Ndlovu says financial inclusion remains a key challenge on the continent as millions still lack access to regulated financial services. “Ukheshe provides fintech solutions for the underbanked. This fits perfectly with my professional passion of helping people step out of poverty in Africa and contribute to the growth of their economies and communities.”

Commenting on the company’s recent appointments, Clayton Hayward, co-founder and CEO of Ukheshe, says both Ndlovu and Opie’s qualifications, career experience and in-depth knowledge of the sector are an invaluable asset to the team. “We are pleased to welcome such skilled and committed professionals to the fold who will no doubt enhance our capacity to compete in a uniquely demanding market.”

Unlike any eWallet or QR payment service Ukheshe works with your lifestyle, not the other way around and is now Masterpass certified which means it can accept payment from Zapper and most banking apps.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Nigerian Medic named one of TIME’s Most Influential People in the world

TIME named Nigerian physician Dr. Tunji Funsho to the 2020 TIME100, its annual list of the 100 most influential people in the world. According to Time Magazine, it’s not often an entire continent eradicates a disease, but on Aug. 25, 2020, that happened when Nigeria was declared polio-free, clearing the virus from its last redoubt in all of Africa. The person who did more than any other to drive polio to continent-wide extinction was Dr. Tunji Funsho, a former cardiologist and now the chair of Rotary International’s polio-eradication program in Nigeria.

Dr. Funsho could have retired years ago, but in 2013, with polio still paralyzing children across Nigeria, he decided to step up to lead the Rotarians’ effort. Together with the Bill and Melinda Gates Foundation, the WHO, the CDC and UNICEF, Funsho and Rotary helped lead National Immunization Days, getting millions of doses of the polio vaccine to children in cities and villages around the nation.

They also sponsored health-education initiatives at community centers, mosques and even birthday parties. This summer, the country marked four years without a case of wild polio, qualifying it for its polio-free certification, leaving Afghanistan and Pakistan as the only places in the world in which polio remains endemic.

“Certification will be an achievement,” Funsho told TIME in 2018. “But we’re not in a hurry for that. We’re in a hurry to make sure no child is paralyzed.” In Nigeria and in Africa as a whole, that moment has arrived. The list, now in its seventeenth year, recognizes the activism, innovation and achievement of the world’s most influential individuals.

Dr. Funsho, a cardiologist based in Lagos, Nigeria, is the first Rotary member to receive this honor for the organization’s work to eradicate polio, having played an essential role in ensuring Africa’s certification as wild polio-free in August of 2020.

“I’m honored to be recognized by TIME for my part in ensuring that no child in Africa will ever again be paralyzed by wild polio, a disease that once disabled 75,000 African children every single year,” said Dr. Funsho. “Eradicating the wild poliovirus in Africa was a team effort that required the cooperation and dedication of governments, partners, Rotary members, hundreds of thousands of health workers, and countless parents who chose to have their children vaccinated against polio.”

As the leader of Rotary’s Nigeria National PolioPlus Committee, Funsho has worked alongside Rotary members throughout the country to raise awareness about the importance of polio immunization, encouraged governments and public figures to support polio eradication, and served as a vocal leader and advocate for Rotary’s fight to end polio in Africa.

Dr. Funsho works closely with Rotary’s partners in the Global Polio Eradication Initiative (GPEI): the World Health Organization (WHO), UNICEF, the U.S. Centers for Disease Control and Prevention, the Bill & Melinda Gates Foundation, and Gavi, the Vaccine Alliance. As a member of Nigeria’s Presidential Task Force on Polio, he has coordinated immunization and advocacy campaigns with the Minister of State for Health and the Inter-Agency Coordination Committee for Polio Eradication. He has also worked closely with the Sir Emeka Offor Foundation, the Dangote Foundation, the Traditional Leaders Council and the Federation of Muslim Women’s Association of Nigeria.

In August 2019, Nigeria reached three years without a case of wild poliovirus. Nigeria’s progress, led by Rotary, its GPEI partners and local and national governments, was the result of decades of sustained efforts, including domestic and international financing, the commitment of hundreds of thousands of health workers, and innovative strategies to immunize children who previously couldn’t be reached due to insecurity in the country’s northern states.

On 25 August, the African region was certified wild polio-free. This historic announcement means that five of the WHO’s six regions, representing more than 90 percent of the world’s population, are now free of the wild poliovirus. The virus is now endemic in just two countries, Afghanistan and Pakistan.

Rotary’s nearly 32,000 members in Africa have played a critical role in helping the region achieve its wild polio-free status by holding events to raise funds and awareness for polio, and working with world governments and national and local leaders to secure funding and support for polio eradication.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

What Africa needs to recover well from Covid-19 disaster—IMF

September 22, 2020

The International Monetary Fund (IMF) has warned that ‘policy-induced distortions that stymie private investment’ must be eliminated and public finance management systems must be improved. According to the Fund, sub-Saharan Africa will need hundreds of billions of dollars and reforms that bring change for a resilient recovery from the damage wrought by the coronavirus pandemic.

Support from the international community that includes stepped-up debt relief, financing and capacity development will be needed, MD Kristalina Georgieva and Abebe Aemro Selassie, the director of the lender’s Africa department, said on Tuesday in a blog post. The IMF has approved more than $15bn in financial assistance and debt-service relief to Sub-Saharan African countries to offset the effects of the pandemic and “certainly will be doing more in the years ahead”, they said. The regional economy will probably contract 3.2% in 2020, before rebounding to grow 3.4% in 2021, the IMF said in its World Economic Outlook published in June.

In addition to assistance from multilateral lenders, many African nations have taken advantage of the Group of 20 leading economies’ debt-service suspension initiative to free up funds to finance the fight against the pandemic. While countries including SA and Ivory Coast announced fiscal-support packages, very little of that was new spending, and as a ratio of GDP it lagged advanced economies.

Policymakers must ensure that the fiscal support deployed to fight the virus also works towards building a smarter, greener and more equitable future, and implement reforms that encourage investment from the private sector, Georgieva and Selassie said. “Important as external support will be, it will be neither effective nor sufficient unless policy-induced distortions that stymie private investment are eliminated or public finance management systems improve,” they said.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

New Leak Shows How $ 2 Trillion Was Laundered Through World’s Biggest Banks

September 21, 2020

Investigations from the International Consortium of Investigative Journalists (ICIJ) has revealed how some of the world’s biggest banks helped their clients, some of whom have questionable means to launder money around the world. The leaked documents from the FinCen files show that about $2tn of transactions are popularly illegally transacted through some of the world’s biggest financial institutions for customers some of whom are known criminals. The FinCEN Files are leaked documents from the Financial Crimes Enforcement Network (FinCEN) that have been investigated by International Consortium of Investigative Journalists (ICIJ). The reports describe over 200,000 suspicious financial transactions valued at over US$2 trillion that occurred from 1999 to 2017 across multiple global financial institutions. The documents appear to show that whilst the United States Government had received this financial intelligence they did little to stop activities such as money laundering. A report by the BBC describes the importance of the files as showing how the “world’s biggest banks have allowed criminals to move dirty money around the world”.

The Financial Crimes Enforcement Network, a bureau of the United States Department of the Treasury is saddled with the task of analysing information about financial transactions to combat domestic and international money laundering, terrorist financing, and other financial crimes.

The FinCEN files revealed how top tier banks such as HSBC, JP Morgan, Barclays Bank, Deutsche Bank, Standard Chartered amongst others helped highly connected individuals move money round several accounts in the world. JP Morgan allowed a company to move more than $1bn through a London account without knowing who owned it.

According to reports the FinCEN files are more than 2,500 documents, most of which were files that banks sent to the US authorities between 2000 and 2017 raising concerns on most of the transactions they carried out on behalf of their customers without following laid down rules because they understood the kinds of transactions involved. The documents are utilised by the banks to report suspicious behaviour.

FinCEN collates suspicious activity reports (SARs), reports required to be filed by financial institutions when they suspect their clients are engaging in financial crime. The files contained about 2,657 leaked documents, including 2,121 SARs, in 2019 and shared them with the ICIJ made up of 400 journalists from 88 countries who proceeded to investigate the leaks which were brought to the public’s attention on 20 September 2020.

The ICIJ has stated that the files are mostly from 2011-2017. Further they noted that the findings may not be representative of all SARs, as the files received are less than 0.02% of the more than 12 million SARs that financial institutions filed with FinCEN during this time. Some of the records were gathered as part of U.S. congressional investigations into Russian interference in the 2016 United States elections; others were gathered following requests to FinCEN from law enforcement agencies.

Deutsche Bank, and Bank of New York Mellon as involved in money laundering. They also criticise the United States government for not forcing the banks to stop this activity. ICIJ equally reported that American Express, Bank of America, Bank of China, Barclays, China Investment Corporation, Citibank, Commerzbank, Danske Bank, First Republic Bank, Société Générale, VEB.RF and Wells Fargo as being involved in the SARs. The ICIJ noted 62% of the leaked filings involved Deutsche Bank, with at least 20% involving addresses in the British Virgin Islands.

Prominent individuals highlighted within the leaks include former Donald Trump campaign manager Paul Manafort, Iranian-Turkish gold trader Reza Zarrab, fugitive businessman Jho Low, and alleged Russian organised crime boss Semion Mogilevich. One of Russian President Vladimir Putin’s closest associates used Barclays Bank in London to avoid sanctions which were meant to stop him using financial services in the West. Some of the cash was invested in works of art, the report added.

Other reporting on national connections to the FinCEN Files includes Canada’s CBC reporting on HSBC and Australian Broadcasting’s coverage.

ICIJ and Deutsche Welle (DW) report that Germany’s Deutsche Bank accounted for 62% of the leaked SARs. DW further notes that Deutsche Bank was responsible for $1.3 trillion worth of suspicious transactions, even after hundreds of millions in fines for violating U.S. sanctions. They also reported that the files revealed Deutsche Bank was a major source for money laundering for organised crime, terrorists and drug traffickers. The Indian Express reported that Jindal Steel and Power was flagged by Deutsche Bank for money laundering.

The SARs, with additional investigations by the Organized Crime and Corruption Reporting Project, also provide further details on the scheme employed by Reza Zarrab to evade economic sanctions on Iran, and its links with the Magnitsky tax fraud and other Russian money laundering schemes.

In Ireland, The Irish Times reported of a Dublin business, “an international company services operation”, whose very successful Riga, Latvia office helped clients from Russia and the former Soviet Union establish secret accounts with Estonian and Latvian banks, with UK LLP shell companies formed back in the 1990s. The FinCEN documents show 646 of 2100 Scottish and English company SARs are linked to this Irish company, the largest number of any such entity. As for his relationship to money laundering, the company founder likens himself to the innocent seller of a criminal getaway car.

The files also revealed a consulting firm for the Tokyo Olympic bid committee paid $370,000 to the son of one-time IOC member Lamine Diack. Diack was jailed for corruption earlier in 2020. The FinCEN Files implicated former Mexican president Enrique Peña Nieto in money laundering. It also revealed that Group Grand Limited was controlled by Alex Saab and Alvaro Pulido.

The files revealed that US banks have notified their authorities of around $160 million that has gone through the partly state-owned DNB group. The transactions via DNB took place mainly from 2015 to 2017. Some transfers date back to 2008. The Gazeta Wyborcza reported that in 2013 and 2014, the HSBC facilitated the transfer of $80 million from investors to the World Capital Market fund, a pyramid scheme that the bank was aware of at the time.

The Central Bank of the UAE failed to act on SARs related to evading sanctions in Iran.

A report by the BBC suggests that the FinCen Files reveal that the United Kingdom (UK) bank HSBC was involved in numerous illegal money transfers. At the time, HSBC was subject to a deferred prosecution agreement for the laundering of $881 million on behalf of the Sinaloa and Norte del Valle cartels. The files also describe how Barclays Bank laundered money on behalf of Arkady Rotenberg, a close associate of Vladimir Putin, who is under sanctions for his involvement in the Ukrainian crisis. The BBC further notes that the UK is judged a “higher risk jurisdiction” due to the number of the country’s companies appearing in SARs.

NBC News reported that North Korea carried out a money laundering scheme in the U.S. using shell companies and help from Chinese firms to launder money through U.S. banks.

When BuzzFeed News reached out to the named banks for response to the allegations, American Express and Bank of China did not respond; Bank of America and First Republic Bank declined to comment. Even as the worldwide group of journalists was preparing their reporting of the FinCEN Files, FinCEN announced on 16 September 2020 that they would be overhauling their money laundering programs. FinCEN condemned the leak, saying that it could impact on US national security, compromise investigations, and threaten the safety of institutions and individuals who file FinCEN reports.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Issues in ensuring COVID-19 vaccine compliance

September 19, 2020

By Derek Yach

An effective COVID-19 vaccine could help us emerge from isolation and end the social distancing required during this pandemic; but it will only work if people are willing to be vaccinated [1].

We conducted a survey in June of 2020 that addressed whether people’s willingness to use a COVID-19 vaccine and adopt other preventive healthcare measures was associated with trust. The survey was conducted in nine countries: China, India, Indonesia, Italy, Japan, South Africa, Sweden, the United Kingdom, and the United States. A thousand individuals were surveyed in each country, and the responses were weighted to the most recent census data.

**Derek Yach, MBChB, MPH, the Foundation for a Smoke-Free World**

While an average of 86% of the respondents had increased the number of times they washed their hands in April and May of 2020, an average of 21% said that they would not get vaccinated. These figures were highest in Sweden (31%) and South Africa (30.6%), but were not much better in the United States (28%) and Italy (23%) (Figure A). Unfortunately, many of these levels barely reach the cusp of vaccine coverage needed to achieve population-wide herd immunity against COVID-19.

Sources show that the public is most concerned with vaccine effectiveness and the risk of vaccine side effects Worry about side effects has historically had a big influence on vaccine acceptance. In the UK, concern about reported neurological complications from common childhood vaccines lowered the vaccination rate from 81% in 1974 to 31% in 1980, leading to a resurgence of pertussis that resulted in over 100,000 cases.In 2018, 20% of respondents to the Wellcome Global Monitor survey in the UK said they believed that the risk of vaccine side effects was fairly high or very high .

Interestingly, our survey showed that respondents who said they would get vaccinated had more education than those who said they would not get vaccinated. These results were highest in the U.S. and Sweden . This may mean that people with more education have more information, but this correlation will need to be further explored before it can be explained.

Dr. Bruce Gellin, U.S. Deputy Assistant Secretary for Health and Director of the National Vaccine Program in the Department of Health and Human Services, has said that the foundation that underpins vaccination acceptance is trust. Our survey explored respondents’ trust of both their national government and the medical profession.With the exception of China, India, and Indonesia, most respondents had relatively low levels of trust in their national government, but most of the respondents said they trusted the medical profession. Trust in both entities, but especially in the medical profession, was generally higher among those who said they would get vaccinated. These findings emphasize the importance of having medical professionals lead messaging about vaccine safety, effectiveness, and benefits.

A recent piece in the Journal of the American Medical Associationon flu vaccination during the COVID-19 pandemic stated that strong, unified messaging is essential to vaccine compliance. The article cites the CDC’s call to action that urges physicians to make every effort to get their patients vaccinated and acknowledges that physicians and healthcare professionals are the most trusted source for accurate information on vaccine risks. The role of medical professions in preventing larger public health crises that could overwhelm the world’s healthcare resources cannot be overestimated.

We suggest that healthcare professionals partner with their national governments and international healthcare experts, such as the World Health Organization, to create consistent, accurate messages about the benefits of vaccination for COVID-19. These messages should use simple language that people with no more than an elementary education can understand; acknowledge peoples’ fears about vaccine side effects and cite accurate, verifiable data on side effect risks; and state whatever data is available on vaccine effectiveness. This will ensure that the greatest number of people will get vaccinated as soon as a vaccine is ready leading to a potential end to the current COVID-19 pandemic.

Derek Yach, MBChB, MPH, is of the Foundation for a Smoke-Free World.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

How Illicit Gold Trade Thrives with Impunity in the Democratic Republic of Congo

A new report has published how the Democratic Republic of Congo’s (DRC) illicit gold trade continues to thrive despite efforts to clean up the sector.

Traders and exporters who are legally registered in the DRC, Rwanda, and Uganda are operating without apparent fear of sanction, even after being publicly named by the United Nations and international organizations year after year as contributing to the illicit trade of artisanal DRC gold.

In its latest report, IMPACT documents how registered traders and exporters provide a sheen of legality by declaring a small percentage of their gold exports while pocketing massive profits from the illicit trade. They thwart attempts to disrupt their scheme by reconfiguring their operations across the region when necessary or by creating phantom entities.

This means that gold smuggled out of DRC and flowing onto the legal international gold market –into consumer products—is potentially tied to criminality, money laundering, armed groups, and human rights abuses.

“Much effort has been made to strengthen responsible artisanal gold trade in DRC, but as long as these shady intermediaries between the miners and the market operate with impunity, all such efforts are futile,” said Joanne Lebert, IMPACT’s Executive Director.

IMPACT found that despite efforts by the DRC government and international actors to introduce traceability and due diligence for artisanal gold supply chains in DRC, the illicit trade appears to be booming: only a fraction of gold production is exported legally, meaning, declared to authorities with all duties and taxes paid.

The report uses several case studies to illustrate the extent of the problem, including that of Bukavu-based Cavichi SARL, a licensed exporter from 2013-2016:Between 2015-2016, Cavichi SARL exported 25.7 kg as declared to DRC authorities, but 5,290 kg as declared to Rwandan authorities in transit documents.Cavichi SARL significantly undervalued its exports, with the 5,290 kg having a declared value of $17.3 million USD whereas international market value at the time would place it closer to $191.5 million USD.Though the company closed down, its founder Caetano Victor Chibalonza continues to operate as a gold trader.
IMPACT’s investigation also takes a closer look at Rwanda as a transit point for DRC gold and the recent growth in Rwandan gold exports. Research suggests Rwandan authorities are failing in their due diligence on gold entering from DRC into Rwanda.

These failings are demonstrated by the case of two phantom entities, Congo Golden Mining Ltd and Omega Gold Mining Ltd:Responsible for 18 gold shipments totalling 627 kg from 2015-2016, Congo Golden Mining Ltd and Omega Gold Mining Ltd are phantom entities that only appear in Rwandan transit documents.Rwandan authorities failed to pick up on fake or suspect documentation such as the vague address, “Building Dubai, UAE”, listed for the phantom entity Al Haitham DMCC, the supposed buyer for Congo Golden Mining Ltd’s gold shipments.
Artisanal mining is often poverty-driven and economic incentives to operate through illicit channels remain great. While some traders and exporters see the benefit of working with traceability and due diligence schemes, those described in this IMPACT report have no incentive to do so.

In light of its conclusion that traceability and due diligence systems for DRC gold cannot make a dent in the scale of illicit trade until the intermediaries’ systems are dismantled, IMPACT is calling on the Government of the DRC to:Investigate, bring to account, and expose well-known intermediaries, including by revoking or denying any trading, exporting, or refining licenses of individuals and companies tied to the illicit tradeStreamline the steps for legal gold exports, ensuring they are clear and not arduous, and that related costs do not discourage legal trade
“This is the moment to bring the intermediaries out of the shadows. For too long, they have been allowed to get away with gaming the system. Never has it been clearer than now, with COVID-19, how these traders profit off of miners’ vulnerability. Authorities must act to halt their operations,” said Joanne Lebert, IMPACT’s Executive Director.

IMPACT also calls on the Governments of Rwanda and Uganda to foster cooperation between law enforcement agencies to identify trade discrepancies and enhance regulatory controls on any gold that is declared as DRC gold.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

Interswitch Plans to Revive its Africa venture fund, to Invest in More Startups

September 18, 2020

Group Chief Executive Officer at Interswitch, Mr. Mitchell Elegbe

Riding against the backdrop of the disruptions caused by the Covid-19 pandemic, the pan-African fintech company Interswitch is planning to revive its Africa venture by investing in more startups across the continent. Interswitch, which is Africa’s second unicorn earlier, planned an IPO before the Covid-19 pandemic put paid to that dream, company sources say that that plan is still in the offing bidding for the right time. But for now, the fintech giant plans to revive investments in African startups.

Founded in 2002, Interswitch pioneered the infrastructure to digitize Nigeria’s then predominantly cash-based economy. The company now provides much of the rails for Nigeria’s online banking system that serves Africa’s largest economy and population of 200 million people. Interswitch has expanded to offer personal and business payment products in 23 African countries. The fintech firm achieved unicorn status in 2019 after a $200 million equity investment by Visa gave it a $1 billion valuation.

Interswitch, which is well beyond startup phase, launched a $10 million venture arm in 2015 that has been dormant since 2016, after it acquired Vanso — a Nigerian fintech security company. But the company’s CEO assured that it will soon be back in the business of making startup bets and acquisitions. According to Mitchell Elegbe, Interswitch CEO, “we’ve just certified a team and the plan is to begin to make those kinds of investments again.” Elegbe said “this time around we want to make financial investments and also leverage the network that Interswitch has and put that at the disposal of these companies,” adding that “we’ll be very selective in the companies we invest in. They should be companies that Interswitch clearly as an entity can add value to. They should be companies that help accelerate growth by the virtue of what we do and the customers that we have,” he said.

Recent venture events in African tech have likely pressed Interswitch to get back in the investing arena. As an ecosystem, VC on the continent has increased (roughly) by a factor of four over the last five years, to around $2 billion in 2019. But most of that has come from single-entity investment funds, while corporate venture funding (and tech M&A activity) has remained light. That’s shifted over the last several months and the entire uptick has occurred in African fintech around entities that could be viewed as Interswitch competitors.

In July, Dubai’s Network International acquired Kenya -based mobile payment processing company DPO for $288 million. Shortly after the acquisition, DPO’s CEO Eran Feinstein said the company would pursue more African acquisitions on its own. In June, another mobile-money payment processor, MFS Africa, acquired digital finance company Beyonic. And in August, South Africa’s Standard Bank — Africa’s largest by assets and lending — acquired a stake in fintech security firm TradeSafe.

Since the rise of Safaricom’s dominant M-Pesa mobile money product in Kenya, fintech in Africa has become infinitely larger and more competitive. The sector has hundreds of startups and now receives nearly 50% of all VC investment on the continent. The opportunity investors and founders are chasing is bringing Africa’s large unbanked population and underbanked consumers and SMEs online. Roughly 66% of Sub-Saharan Africa’s 1 billion people don’t have a bank account, according to World Bank data, and mobile-based finance platforms have presented the best use cases to shift that across the region.

Interswitch has established itself as a leader in Africa’s digital finance race. But it’s hard to envision how it can maintain or extend that role without an active venture arm that invests in and acquires innovative, young fintech startups.

For now, the company is focusing on its expansion as it plans to maintain focus on Africa for the time being. “There are enough opportunities for Interswitch on the continent. We’d like to be in as many African countries as possible…and position Interswitch as the (financial) gateway to the continent,” he said. Elegbe explained the company would continue to work through alliances with major financial services firms to open up global financial access for its African client base. In August 2019, Interswitch launched a partnership that allows its Verve cardholders to make payments on Discover’s global network.

“Nigeria has a very large population and a very large market. We have lots of challenges that need to be solved, but it makes sense to me that lots of money is finding its way to Nigeria because the opportunity is there,” he said. Elegbe’s advice to tech investors considering the country, “Don’t take a short-termist view. There are good people on the ground doing fantastic work — honest people who want to make impact. You need to seek those people out.”

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry

InfraCredit completes drawdown of AfDB’s $10m loan agreement

September 17, 2020

Lagos Nigeria based InfraCredit, an ‘AAA’ rated specialised infrastructure credit guarantee institution, says it has completed the drawdown of a $10m subordinated unsecured 10-year facility under the subordinated loan agreement with the African Development Bank (AfDB). This was made known in a statement highlighting the processes of the drawdown titled ‘InfraCredit completes drawdown of AfDB $10m subordinated unsecured 10-year facility.’

Chief Executive Officer of InfraCredit, Chinua Azubike

According to the bank’s Director of Financial Sector, Stefan Nalletamby, at the time of the bank’s board approval of the facility, said, “The bank’s support will strengthen the capital base of InfraCredit, underpinning the expansion of the company’s core business of guaranteeing of bonds issued to fund infrastructure projects.

“This adds to the bank’s existing initiatives to mobilise domestic institutional savings and stimulate non-sovereign local debt capital market development in Nigeria. “This ultimately helps to increase private sector financing for critical infrastructure projects in key sectors including energy, agriculture, water, health and education, through local capital markets.”

Specifically, this facility will help to increase private sector financing for critical infrastructure projects in sectors such as power, renewable energy, telecommunications, healthcare, transportation, agriculture, amongst others. This investment by AfDB demonstrates the strong investor confidence in the fundamentals of InfraCredit’s business and will promote the deepening of the local debt capital market. Pursuant to the drawdown, InfraCredit’s capital base will increase to $146 million (c. NGN 58.5 billion).

According to the Chief Executive Officer of InfraCredit, Chinua Azubike, ‘’Despite the impact of COVID-19, and changes to macro-economic assumptions, we are pleased to have reached yet another milestone in our pursuit to strengthen our robust balance sheet and guarantee issuing capacity. Notwithstanding challenging market conditions, we have continued to demonstrate our strong fundamentals, solid underlying portfolio performance, proven track record and profitability. With the admission of AfDB to our capital structure, we are confident of our continuing ability to deepen market penetration and support access to long term domestic credit for the growing pipeline of infrastructure projects that will create jobs and support local economic growth”.

InfraCredit provides local currency guarantees to enhance the credit quality of debt instruments issued to finance creditworthy infrastructure assets in Nigeria that conform to its eligibility criteria.

Kelechi Deca

Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry