5 African Cleantech Startups You Need To Watch

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5 African Cleantech Startups You Need To Watch

A woman uses a solar light from M-Kopa. Image: Georgina Goodwin/M-Kopa

Africa is extraordinarily rich in energy power potential. According to McKinsey and Company’s 2015 Brighter Africa report, the continent has 10 terawatts or more of potential capacity for renewable energy. If sub-Saharan Africa pushes renewables, it could result in 27 percent decrease in carbon emissions worldwide.

But sub-Saharan Africa is in an energy crisis. Two out of three Africans lack access to electricity — that’s 621 million people. The Brighter Africa report also stated the sub-Saharan Africa region has 13 percent of the world’s population, but 48 percent of the share of the global population without access to electricity.

African entrepreneurs and technologists are coming up with solutions to solve their own energy problems. In 2014, Bloomberg New Energy Finance predicted that 1.8 gigawatts of renewable energy would be commissioned. That’s a huge leap from the previous 14 years. And in the first quarter of 2015, Bloomberg reported, South Africa emerged as one of the top clean energy leaders.

Here’s a look at five African cleantech startups bringing power to the continent.

M-Kopa Solar

M-Kopa started a pay-as-you-go solar revolution in Africa by capitalizing on the popularity of mobile phones on the continent. Customers replace kerosene lamps with a solar light and radio/phone charging stations over several months in installments via SMS messaging on mobile money networks. The company was started by the founders of M-Pesa, Kenya’s incredibly popular mobile money system that has served as a model for the rest of the world.

Quaint Global Energy Solutions

This Nigerian company develops renewable power projects, and recently received a US Trade and Development Agency grant as part of Power Africa, a US government initiative. Quaint Global is working with California-based Tetra Tech, an energy project developer, on a feasibility study to determine the best way forward with the project. The effort will bring 50 megawatts of clean energy to Kaduna State, a state in Nigeria, and could also leverage more than $160 million.

Freedom Won

This South African company was founded in 2011 to grow Africa’s clean energy and electric vehicle solutions. The first electric vehicle prototype they developed was Freedom1, a Jeep Grand Cherokee, and since then, they have built several more, mostly for safari drives for wildlife tourism.

More recently, Freedom Won created a wall-mounted Tesla Powerwall-like system called the FreedomCOR, which uses lithium-ion batteries to store renewable energy. The modular batteries range in size from 5 kilowatt hours to 30 kilowatt hours for residential, and even larger for industrial, and reportedly last up to 13 years.

African Clean Energy

According to this company, three billion people worldwide cook on open fires or with dirty, dangerous fuel, and accidents resulting from that kill four million people a year. To help solve this massive problem, African Clean Energy developed the ACE 1 Ultra-Clean Biomass Cookstove, which burns any type of biomass cleanly and smoke-free indoors or outdoors. It reduces fuel use about 70 percent, saves 50 percent of costs, and drastically improves the lives of women and children, who do the majority of the cooking.

iCoal Concept Ltd.

Earlier this year, the World Bank’s Kenya Climate Innovation Center launched a crowdfunding mentorship program for entrepreneurs in East Africa, to provide them financial services and mentorship. One of the startups chosen was iCoal Concept Ltd., which turns the waste from charcoal into modern energy. The company collects charcoal waste from the community and repurposes it into  charcoal-based briquettes that are 35 percent cheaper than regular charcoal.

Kenyan households use 700 tons of charcoal per day. But now that iCoal has a handle on the market, the startup is producing three tons of its own SmartCharcoal per day for hotels, farmers, and residential communities.

Source:Forbes.com Lyndsey Gilpin

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Black Buying Power vs Black Buying Potential

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The recent murders of unarmed black men in several US cities have enraged thousands of people, both nationally and globally. They have also resulted in the creation of movements that call for the black community to withhold the $1 trillion in buying power from major corporations and instead to spend them with black owned businesses.

I support this message because well structured black businesses that offer quality goods and services deserve a chance to survive and thrive just as much as any other business does. Currently, all other communities in the US practice group economics at a high level. They buy from their own people, help their businesses grow and strengthen their economic and political power base. It is common sense and I’m not upset about it. They understand the game and are playing it because this it is in their best interest to do so.

Unfortunately, the black community has not yet fully embraced this method of economic development. From the 1880’s into the 1960’s, a majority of American states enforced segregation through “Jim Crow” laws . Black people were prevented from patronizing white businesses and establishments. This forced them to create their own businesses and transact with each other. The black dollar circulated within the community several times over before leaving, bringing rise to hundreds of successful black businesses. The buying power of black people during that era was used to strengthen their economic power base and create wealth. It did so until the end of Jim Crow in 1965 when integration became legal. At that point, black dollars started leaking from the community and have not been back since. Now, over 90% of black income is spent in other communities.

This is why the term “buying power” is a bit misleading. It is currently just a marketing phrase that defines the ability of a certain demographic to spend its disposable income with different corporations. Are we spending this income on items that appreciate or depreciate in value? Are we increasing debt incurred when exercising this “power” with credit cards? Power can defined as the ability to control people and things. What does the black buying power currently control or influence? From what I can tell, it influences the allocation of corporate marketing budgets. It controls who corporations will target to make the most profit from a certain good or service. It does not seem to control or influence anything that contributes value to the community from which the dollars come from.

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I would argue that right now, this trillion dollar buying power is really just buying potential. It shows that black people spend a lot but it doesn’t not show that any assets, wealth or political influence are being created by this spending. The true buying power of a community should be defined as its ability to not only support businesses that will create employment in that community, but also create political as well as economic influence. The political power gained will help to create laws and policies that will ultimately affect the community positively. Money talks and politicians listen to those with money. Who do you think will get a politicians attention; the person that yells “I voted for you!” or the person that yells “I wrote you a $1000 check!”

A trillion dollars of buying “power” could and should even have an international reach. Nigerian billionaire investor and philanthropist, Tony Elumelu recently announced that he has committed $100 million to create 10,000 entrepreneurs across Africa over the next 10 years, targeting the creation of 1,000,000 new jobs and $10 billion in annual revenues. True buying power should be able to accomplish something similar even if on a much smaller scale. How about pooling $10,000 to create or support a well planned business that manufactures, distributes and sells certain food or non food items that the black community and even other communities already spend millions on each year?

There are many stigmas attached to black businesses, some accurate and many not. Over the past few weeks I have done some research and come across several black owned businesses that I never knew existed. These businesses provide products and services that are simply amazing! I’m asking that we begin to think and spend more strategically just as others are doing.

Nigerian Billionaire Tony Elumelu Commits $100 Million To Create 10,000 African Entrepreneurs In 10 Years

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Tony Elumelu

Nigerian billionaire investor and philanthropist Tony Elumelu has committed $100 million to create 10,000 entrepreneurs across Africa over the next 10 years.

Elumelu made the commitment on Monday during a press conference in Lagos to announce the launch of The Tony Elumelu Foundation Entrepreneurship Programme (TEEP).

TEEP, a Pan-African entrepreneurship initiative of the Tony Elumelu Foundation, is a multi-year programme of training, funding, and mentoring, designed to empower the next generation of African entrepreneurs.

The programme will identify and help grow 10,000 start-ups and young businesses from across Africa over the next 10 years. These businesses will in turn create 1,000,000 new jobs and contribute $10 billion in annual revenues to Africa’s economy. The 10,000 start-ups selected from a pool of applicants across Africa will participate in a comprehensive programme which will include a customized 12-week business skills training course, mentoring, an entrepreneurship ‘boot camp’ and seed capital funding among other things. Interested entrepreneurs will be able to submit their applications to join the programme as from January 2015 through the Tony Elumelu Foundation’s website.

“The opportunity and challenge in Africa is scale – in our people, our resources and our horizons. In my business and philanthropic journeys, I have always sought ways to help inspire a generation across our continent. This programme brings together my own entrepreneurial experience and my fundamental belief that entrepreneurs – women and men across Africa – will lead Africa’s development and transform our futures,” Tony Elumelu, founder of The Tony Elumelu Foundation, said in a press statement.

The programme will be backed by a $100 million grant from the Tony Elumelu Foundation, an African-based, African-funded philanthropic organization that supports entrepreneurship in Africa by enhancing the competitiveness of the African private sector. The Foundation is solely funded by Tony Elumelu, a billionaire who has derived an estimated $1 billion fortune from banking, energy, investments and real estate according to FORBES’ recent ranking of Africa’s 50 Richest People.

“It is our opportunity to empower a generation,” said Elumelu.

More details about the program, including eligibility and the application and selection processes are available on the Tony Elumelu Foundation website at: www.tonyelumelufoundation.org/TEEP.

Souce: Forbes.com

The Russians are coming: Russia increases its role in African Trade

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Russian President Vladimir Putin (R) shakes hands with his Egyptian counterpart Abdel Fattah al-Sisi (L) during their meeting at the Bocharov Ruchei residence in Sochi on August 12, 2014 during the Egyptian leader's first official visit to Russia. (AFP Photo / Alexei Druzhinin)

Russian President Vladimir Putin (R) shakes hands with his Egyptian counterpart Abdel Fattah al-Sisi (L) during their meeting at the Bocharov Ruchei residence in Sochi on August 12, 2014 during the Egyptian leader’s first official visit to Russia. (AFP Photo / Alexei Druzhinin)

I’ve said it before and I will say it again. Africa is the last frontier.The Continent has been the trade and investment location of choice for all of the BRICS nations several years now. Recently, Russia, a nation that has been largely absent from the scramble for Africa, has reared it’s head and is making moves.

I am certain that this decision was prompted by recent US sanctions against Russia related to the situation in Crimea. In response to those sanctions, Russia suspended imports of meat, fish, fruit, vegetables and milk products from the United States, the 28-nation European Union, Norway, Canada and Australia for a year. This will cost these nations more than about $17.5 billion for the duration of the year long ban.

Russia is now stepping up its search for partners to fill this void with suppliers in Latin America and Africa.

According to Russia Times, “Russia held talks on creating a free trade zone with Egypt and countries in East Africa have said they are ready to triple or quadruple trade with Russia.

“African suppliers have declared their readiness to supply Russia with up to 100,000 tons of fruit and vegetables per week, products that before were re-exported to Russia via the European Union,” Elena Nagornaya, president of the Russia-Africa trade alliance, told ITAR-TASS.

African countries are ready to directly export pineapples, bananas, citrus fruits, apples, nuts, avocados, strawberries, as well as ginger to Russia. Negotiations are underway with major Russian grocery chains.”

Egypt said it is ready to boost agricultural deliveries to Russia by 30 percent. The head of the Ministry of Agriculture of the Russian Federation, Nikolay Fedorov said this will close half of a possible deficit following Moscow’s ban on the import from some Western countries. In 2013, Egypt’s exports of agricultural products to Russia totaled $440 million, meanwhile in the first half of 2014, they have already supplied $460 million. Trade turnover between the two countries in 2013 amounted to $3 billion and more than doubled in the first half of this year to $2.5 billion from $1.2 billion in the same period of last year, according to ITAR-TASS estimates.

I am optimistic about this opportunity. However, my concerns with Russia in Africa are the same as those with China in Africa. I want the business conducted to be mutually beneficial, not just for the companies involved but for the people of Africa.

Sources:

http://www.rt.com

http://www.eurasiareview.com

What Africa Needs – Part 2

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Here you go! Part 2 of the 5 part series, What Africa needs: Increased Inter- Africa trade.

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According to the Economist, “The bulk of the Africa’s trade is with Europe and America: only 12% is with other African countries, according to research by Ecobank, a Togo-based bank. By comparison 60% of Europe’s trade is with its own continent. The same is true in Asia. In North America the figure is 40%.”

According to Reuters Africa, it costs South African grocer, Shoprite $20,000 a week to secure import permits to distribute goods in one country. As if that isn’t enough, in order to send one of its trucks across the border to neighboring Zambia, 1600 additional documents are required.

An excessive amount of border check points  are yet another problem.  To transport goods from Nigeria to neighboring Ghana, you have to go through about 5 border checks. Ghanaian President, John Dramani Mahama admits that he is aware of the problem and states that Ghana is working to reduce the number of border posts to just one. In my humble opinion, zero would be better but you have to start somewhere right? The legal and illegal payments made at these borders are all costs that are passed on to consumers in order for the traders to make a profit. At one checkpoint in Mali, border agents extort as much as $4,000 every day. In addition to the aforementioned high costs of trade, unclear policies are another hindrance. Seeds from Kenya can be held indefinitely at an Ethiopian border because they don’t meet Ethiopia’s standards. Tanzania may ship corn to Kenya only to find out there is now a ban on the importation of corn.

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The issue of infrastructure also needs to be addressed. Lack of adequate road, rail, and other physical infrastructure continue to impede trade within and between African countries. According to a report from the UN Economic Commission for Africa, only about 30% of African roads are paved and, as a result of this “shipping a car from Japan to Abijan costs $1500 while shipping that same car from Addis Ababa to Abijan would cost $5000.” Some of these unpaved roads have potholes big enough to swallow an SUV. The railways in Kenya and Uganda face multiple constraints, including ageing equipment and infrastructure with some over a century old.

These are just some examples of red tape and trade barriers that are costing Africa billions of dollars and depriving the region of new sources of economic growth. However, in spite of all this, there is reason to be optimistic. It seems that for the past few years, this issue has become too dire to ignore and strides are being made to rectify it.

In 2012, South Africa’s President Jacob Zuma unveiled a plan to spend $97 billion on infrastructure by 2015 to upgrade roads, ports, and transportation networks. At the World Economic Forum held this May in Abuja, Kenya’s President Uhuru Kenyatta called on African leaders to work together in removing obstacles that hinder movement across the continent. In his speech, he said free movement would help Africa meet its development targets. He also announced plans for Kenya and Nigeria should sign agreements that will boost trade and investment between the two countries. Since then, the Nigeria Export Promotion Council, NEPC, and its Kenyan counterpart have pledged to explore the vast market opportunities in Africa to promote trade and investment

Also at the 2014 World Economic forum, Africa’s richest man, Aliko Dangote spoke on the matter of visa issuance stating that presently, he and other Nigerian businessmen are required to obtain visas to enter about 38 African countries but a foreigner has more access to these same counties than he does because all they need to do is get a visa at the airport and pass through.Steps are being taken to streamline the visa process so that African businessmen and investors can invest in other countries with ease.

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In Kenya, barriers that formerly prevented professionals like doctors and lawyers from practicing in Rwanda have been removed. Now, a Kenyan lawyer can practice law in Rwanda without sitting for the bar all over again. This will also lead to a reduction in unemployment because new graduates will have more job options and not so new graduates will have more opportunities to provide services.

At the end of the day, increased inter Africa trade is the best way for Africa to use all of its resources and talent become self sustainable, grow and thrive. The less cumbersome the trade process is, the lower the cost of goods and services will be. The lower the cost of goods and services, the more people can afford them. The more people can afford them, the more people will be empowered and gradually lift themselves out of poverty.