5 Things to Know About Climate Change in the Caribbean!

Originally posted on caribbeanclimate:

Natural events and human activities contribute to an increase in average temperatures around the world. Increases in greenhouse gases such as Carbon Dioxide (CO2) is the main cause. Our planet and our region are warming. This leads to a change in climate.

  1. The Caribbean is a minute contributor to global greenhouse gas emissions, but will be among the most severely impacted.
  2. We are already experiencing its impacts. More frequent extreme weather events, such as the 2013 rain event in the Eastern Caribbean; the extreme droughts being experienced across the region, with severe consequences in places like Jamaica; the 2005 flooding in Guyana and Belize in 2010. And further Climate Change is inevitable in the coming decades.
  3. Inaction is VERY costly! An economic analysis focused on just three areas - increased hurricane damages, loss of tourism revenue and infrastructure damages - could cost the region US$10.7 billion by 2025. That is…

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How Anti-World Bank Activists Misunderstand Business

I was recently made aware of Interoccupy‘s (link) protest against the World Bank at their fall meeting in Washington. What follows is my reaction to what I feel is Interoccupy’s misunderstanding of the arena in which most businesses operate:

I have followed the history of problems with World Bank lending. Economist Joseph Stiglitz has written extensively about the issue. I find that the World Bank is torn between its role as a bank–it does after all make loans and its business model depends on loans being repaid–and its role as a development institution. When countries fall behind on a loan the World Bank behaves as banks usually to, telling the debtor to cut back on anything not directly related to loan repayment, which sometimes means cutting muscle as well as fat out of public budgets.

Interoccupy’s complaints revolve around the World Bank’s Doing Business rankings and the Bank’s alleged encouragement of large land acquisitions by agribusiness corporations. I take issue with Interoccupy’s charge that the rankings are only about serving the interests of multinationals. The countries that score high on this and similar rankings by the World Economic Forum have been the best performers in recent years not only in GDP growth but in income growth and lifting their people out of poverty. Furthermore the rankings also serve the interests of smaller businesses who do not have the ability to influence governments. The rankings are based on surveys local businesses which in the developing world will be mostly small and mid sized. Among the survey topics are Starting a Business, Getting electricity, Enforcing Contracts, and Getting Credit.

What would really change the game is if a group like Interoccupy developed their own doing Business ranking based on a concept of profitable and responsible business. Organizations like the Global Impact Investor Network (www.theGIIN.org) are developing tools to measure social impact that they would find useful. If they then cited examples of commercially successful companies that followed these principles they would have a strong case for reform.

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Africa 8 and 3 Cities to Watch

Two recent stories caught my attention for their deeper analysis of African economic growth:

A post in LinkedIn’s African Financial Professionals group links to an article about the Africa 8. The Africa 8 are 8 countries highlighted in a study by Ecobank, a pan African bank based in Togo. Ecobank predicts Angola, Republic of the Congo, Cote d’Ivoire, Ghana, Kenya, Mozambique, Nigeria, and Rwanda to be the drivers of growth on the the continent. Ghana, Nigeria and Kenya are known to be attractive due to their political stability (Ghana), size (Nigeria) and tech driven dynamism (Kenya). Cote d’Ivoire has put its civil conflict in the past and in some ways is like a francophone version of Ghana. Congo and Angola are all about oil. Mozambique shows high rates of growth but one wonders if its influence is felt beyond its borders.

The question for all these countries is whether they will evolve into more than just natural resource plays which are vulnerable to market swings and technological and social trends such as the global imperative to move away from fossil fuels. Many of these economies are also carrying large amounts of public debt which could become a problem if US interest rates rise or commodity prices fall.

The second story identifies three African cities that are at the beginning of their growth curve: 1) Abidjan, Cote d’Ivoire, 2) Dakar, Senegal, 3) Ouagadougou, Burkina Faso. http://www.emia.org/news/story/978 This is another way of acknowledging the growth prospects of the countries for which these are the major cities.

In addition to Cote d’Ivoire’s positive outlook, Abidjan is considered one of the most attractive cities in West Africa and is an important center for meetings, tourism and commerce. Dakar, the capital of Senegal is a port at the westernmost location on the African continent, giving it easy access to Europe, North and South America. If West Africa is serious about regional integration then Dakar will become even more attractive as a gateway city. Ouagadougou stands out in this group in that although it is a national capital it is not one of the region’s most important cities. It is included largely because of growth in Burkina Faso’s gold mines.

Investors and entrepreneurs considering entry into Africa should start by investigating the locations cited above. Each is brimming with opportunities and fraught with challenges—all for different reasons. Knowledgeable advisors both at home and on the ground can help point the way.

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Major African Stock Index and Exchange Rate Changes in Q2-2014

Advansa International follows exchange rates and stock market indexes for several emerging and frontier markets. Exchange rates and stock indexes are recorded on the last trading day of the week. The tables below show changes from the last trading day of the last full week of the quarter for several key markets in Africa.

Table 1 

 STOCK MARKET INDEX TRACKER 2ND QUARTER 2014

AFRICA

COUNTRY

2ND QUARTER PCT CHANGE

GHANA-Local Currency

-1.42%

GHANA-US$

-18.45%

KENYA-Local Currency

-2.78%

KENYA-US$

-3.86%

NIGERIA-Local Currency

10.06%

NIGERIA-US$

11.33%

SOUTH AFRICA-Local Currency

5.62%

SOUTH AFRICA-US$

5.32%

WEST AFR. BOURSE-Local Currency

-2.17%

WEST AFR. BOURSE-US$

-2.99%

MSCI AFRICA-Local Currency

4.25%

MSCI AFRICA-US$

3.94%

MSCI EMERGING MARKETS-Local Currency

4.44%

MSCI EMERGING MARKETS-US$

6.22%

Sources: Stock exchangewebsites, Financial Times, Advansa International data

 

Table 2

2ND QUARTER 2014 EXCHANGE RATE TRACKER

AFRICA

COUNTRY

2ND QTR PCT CHG 

 

YTD JUN PCT CHANGE 

CFA AREA*

-0.81%

-0.99%

GHANA

-17.03%

-27.12%

KENYA

-1.07%

-1.94%

NIGERIA

1.27%

-1.49%

SOUTH AFRICA

-0.30%

-1.42%

TANZANIA

-1.09%

-4.35%

UGANDA

-1.85%

-3.70%

Sources: Financial Times, Advansa International data

*Includes most French speaking countries such as Benin, Cameroon, Cote D’ivoire, Guinea, Senegal, Togo and others

The big markets–Nigeria and South Africa performed well. Both markets were up in local currency and in dollars.It appears that the long term story–the demographic boom, the growing middle class, the improved political environment in some countries–are causing investors to look past current bumps in the road.

Despite lackluster growth, South African stocks have been strong. The country remains an attractive investment destination, its stock market being the largest and most liquid in Africa.

Nigerian stocks have proven attractive to investors and Boko Haram attacks and new competition from North American shale oil have not changed anyone’s thinking so far. Most of the market activity is in the financial services sector lead by such firms as Access Capital and Guaranty Bank. Consumer goods companies such as Nigerian Brew have also showed strength. The naira actually gained a little during the quarter and remains within the narrow range that has prevailed all year.

In Ghana, currency weakness continues as the nation has sought IMF assistance to help get its accounts back toward balance. Trading activity is as usual dominated by the large consumer and financial service companies such as Fan Milk, UT Bank, and EcoBank. The stock market has weakened, reflecting caution among investors even though the economy is still growing. Could be a chance to get in the market cheap.

In fact, the current period is a possible second chance for international investors to invest in African assets at favorable prices when exchange rates make deals affordable and much of the bad news is already priced in.

 

 

 

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Call to scale up climate partnership for small islands

Originally posted on caribbeanclimate:

The heads of three regional organisations, together with the Commonwealth, have called for the strengthening of a global partnership to support climate change planning and finance in small island developing states. 

The Climate Resilient Islands Partnership was formed in 2011 and launched at the Rio+20 summit to support island nations, many of whom face existential threats as a result of climate change and rising sea levels, by providing a facility for sharing learning and providing mutual technical assistance.

Ahead of the International Conference on Small Island Developing States, in Samoa between 1-4 September 2014, the Commonwealth, the Secretariat of the Pacific Regional Environment Programme, the Caribbean Community Climate Change Centre and the Indian Ocean Commission united in calling for new partners to scale up the partnership.

Speaking at a parallel event, the heads showcased some of the achievements of the partnership since it was launched at Rio+20. These include joint…

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Ghana’s Currency, Millennium Challenge and Economic Prospects

The Millennium Challenge Corp. recently signed a second compact with the Republic of Ghana.http://www.state.gov/secretary/remarks/2014/08/230295.htm  This compact’s focus on the power sector addresses a major challenge to Ghana’s economic growth and to Ghanaians’ overall quality of life. The signing of the MCC compact is a good time to reflect on current economic and business conditions in Ghana.
Ghana is potentially a strong economic engine for the region and Secretary of State Kerry is right to cite Ghana’s commitment to good governance and economic prosperity. However the country faces some major challenges. Among them is the rapid depreciation of Ghana’s currency. Our data shows that the cedi lost about 27% in the 1st half of the year and has continued to fall since then. Currency weakness in Ghana is a symptom of persistent trade deficits as well as rising government spending. The financial community has noticed and has raised the issue in several forums and publications. It doesn’t change the longer term story of Ghana’s growth potential (in fact dollar based investors might find favorable prices for Ghanaian assets) but it does raise questions about how government will handle the problem while remaining investor friendly.
Red flags went up earlier this year when the government began to restrict the movement of currency, damaging Ghana’s reputation for financial openness. The more sensible answer is to change the character of Ghanaian trade. Surpluses might be a lot to ask but Ghana should at least aim for smaller trade deficits. Ramping up the nascent oil sector would help but there should also be greater orientation toward exporting in several sectors. This is why reliable electric power is so crucial. It’s location, general business friendliness and political stability make Ghana a logical export platform for the West Africa region as well as destinations further abroad. However for indigenous and foreign investors to locate in Ghana reliable electric power is essential. For that reason we should all hope for the success of this second MCC compact.

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What Tech Hubs Are Getting Wrong in Africa (and How to Fix It)

advansa:

Tech hubs and accelerators are a good way for investors to build relationships in the target market and to get acquainted with the local entrepreneurial community. This can mitigate some of the risk inherent to angel/venture investing. Social investors should consider becoming the kind of corporate partner the author suggests are necessary for accelerators to become sustainable.

Originally posted on :

In a post about Africa’s growing tech hub community, researcher Dan Evans (whose work we’ve covered previously), writes:

“Based on the maturity and business viability of many of the small tech firms that we have met with over our data collection visits, and the modification of many incubators’ business models, we completely understand the thought-process behind this “pivot” in strategy. For example hubs that we have previously visited like iceaddis and iLab in Liberia, andHiveColab in Uganda have all scaled back their original lofty aspirations. These hubs originally planned for a multi-tier membership model, charging rent for office space, and acquiring equity of the companies that were the most mature. Based on these assumptions, they thought they could be self-sustaining in a short period of time. All have scaled back their expectations and operate more as collaboration spaces for the local tech community and offer technical training…

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Call for proposals – your green idea could win up to US$15,000

Originally posted on caribbeanclimate:

Untitled

greenovators_EN

Are you a young innovator?
Are you a citizen of Latin America and the Caribbean?
Are you passionate about climate change?

If so, you are eligible to participate in the Greenovators contest, organized by Inter-American Development Bank (IDB) and EARTH University, in collaboration with the Ibero-american General Secretariat and Costa Rica’s Ministry of Environment and Energy.

The proposed project must provide specific indicators to monitor the impact of the project because the work that are awarded seed funds must commit to a monitoring report for evaluation by the end use of funds to deliver. Your project should be in one of the following areas:

  • Education and Awareness
  • Energy Efficiency
  • Renewable Energy
  • Sustainable Transport
  • Sustainable Business
  • Resilient Agriculture
  • Water resources
You could win
  • 5 prizes of US$ 15,000
  • 10 prizes of US$ 10,000
  • 15 prizes of US$ 5,000

Contest participants can also win a trip to Costa Rica and participate in the…

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5 Bad Reasons to Start a For-Profit Social Enterprise

Originally posted on HBR Blog Network - Harvard Business Review:

Should a new social good organization choose a for-profit model or a nonprofit one? This is a question we face each year at my organization, Echoing Green, when we evaluate thousands of business plans from social entrepreneurs seeking start-up capital and support. This year, nearly 50% of those plans proposed using a for-profit model. And when we asked these entrepreneurs why, some of their reasons were just plain bad.

They are not alone. New entrepreneurs are increasingly starting for-profit firms whose primary purpose is social impact. Supporting this trend is a tremendous increase in capital available for “impact investing.” According to a recent JPMorgan/GIIN report, impact investors invested nearly $11 billion across 4,900 deals in 2013, up 250% from 2011.

At Echoing Green, the social impact of our portfolio is our highest priority, so we’re agnostic on which form the organization takes. With the new possibilities for for-profit models (including B Corps,

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Coral Reefs Report and Climate Change News

Originally posted on caribbeanclimate:

With only about one-sixth of the original coral cover left, most Caribbean coral reefs may disappear in the next 20 years, primarily due to the loss of grazers in the region, according to the latest report by the Global Coral Reef Monitoring Network (GCRMN), the International Union for Conservation of Nature (IUCN) and the United Nations Environment Programme (UNEP).

The report, Status and Trends of Caribbean Coral Reefs: 1970-2012, is the most detailed and comprehensive study of its kind published to date – the result of the work of 90 experts over the course of three years. It contains the analysis of more than 35,000 surveys conducted at 90 Caribbean locations since 1970, including studies of corals, seaweeds, grazing sea urchins and fish.

The results show that the Caribbean corals have declined by more than 50% since the 1970s. But according to the authors, restoring parrotfish

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