Blogs

For growth, look to Africa

first_imgIf you’re looking for robust economic growth during this prolonged, fitful recovery from the recent global economic crisis, look toward Africa. Ethiopia’s gross domestic product grew almost 10 percent in 2014, Tanzania’s 7 percent, the Democratic Republic of the Congo’s 9 percent, Rwanda’s 7 percent. Those numbers, of course, mask other problems, such as gaping inequality and millions living in poverty. Still, Donald Kaberuka, the former president of the African Development Bank, said that from an economic standpoint, the numbers are no fluke.Kaberuka acknowledges that helping millions of people out of poverty is an enormous job, but he also points to increased government stability, regulation that sets a level economic playing field, ample natural resources, and a young, growing population hungry for both jobs and consumer goods, all good signs for the future.Kaberuka, who is now the Hauser Leader-in-Residence at Harvard Kennedy School’s Center for Public Leadership, sat down with the Gazette recently to talk about his 10 years at the helm of the bank, which is charged with fostering development on the continent. He also discussed Africa’s economic future, and his own plans for his fellowship year.GAZETTE: Let’s start with some background on the African Development Bank. What is its mission?KABERUKA: The African Development Bank is the continent’s premier development institution. We commit, every year, close to $8 billion in funding, a combination of loans, grants, and guarantees, to fund various sectors of development. In the last years, our key investment has been infrastructure — 60 percent of the portfolio in energy, highways, the kind of things that Africa needs. Beyond funding, we are also an important player in the policy dialogue with countries. We are firm believers in the concept that development is not simply about money. If development was about money only, Libya would be the most developed country in the world. So it’s about money, it’s about policies, and it’s about delivery capacity.GAZETTE: What would you say were the main achievements of the bank during your tenure there?KABERUKA: I took office in 2005, at a time when Africa was changing dramatically, reversing years of decline for the first time with real per-capita growth, which was over 7 percent in many countries.We decided to focus on how to best to stimulate this new momentum in Africa. And we made the following choices: Number one, a big push on infrastructure. In the last 10 years we have put into infrastructure about $28 billion and, assuming a leverage [expansion across the economy] of one to five, you can imagine this is quite an important contribution. The second thing we did was to lead from the front on the private sector. The cliché overseas for a long time was that Africa was a risky place to do business, and we set out to show that the return on investment in Africa was actually higher than that on other continents. We have to put our money where the mouth is, and so we increased significantly the bank’s support for business, from $300 million a year to $2.8 billion at the time I left office, per annum. The third thing we did was to focus on deepening Africa’s internal single market. We’re a continent of 1 billion people, but we needed to deepen that market by cross-border infrastructure, removing nontariff restrictions, increasing regional public goods, all things that deepen a market of 54 countries into one single market. And finally … improving the quality of institutions, institutions that support the economy: financial management, tax collection, oversight institutions, functioning commercial codes — which are sometimes as important as money.We give a particular focus to natural resource-rich countries — exporters of oil and gas and minerals — because these have enough money of their own, if well managed, to avoid the Dutch disease, or the resource curse, as they call it. And also [we give] special attention to countries coming out of years of conflict and war, like Liberia, Sierra Leone, and many others. So these basically were our areas of focus. I’m glad to tell you that under my presidency, the general capital of the bank went from $32 billion to $100 billion. We tripled the capital of the bank in 10 years. We managed to raise soft grants for poorer countries almost 2½ times, to $5 billion. We managed to put out there a powerful counter-cyclical response to the global financial crisis, which minimized dramatically the damage to African economies.GAZETTE: What was that response? Was it increased lending?KABERUKA: The global financial crisis for many low-income countries took the following form. Our banking sector was quite solid, well-regulated. There was no issue of capital adequacy, there was no issue about liquidity, there was no issue about toxic products. But there was retrenchment by the European banks from funding, for example, African trade and business. So we had to step in where the European banks were retrenching. We had to pick up some of the important projects that risked being abandoned, because abandoning projects and picking them up later can actually be more expensive. And in a few countries we provided a bit of liquidity, just as a precaution.Botswana [is] a very well-managed country, one of the best in the world. But the diamond market was tanking, because in a crisis like this there is a flight to safety in gold and away from prestige things like diamonds. So we had to step in with about $1.6 billion to help Botswana cope with that particular problem … It took different forms depending on the different countries.GAZETTE: How does the bank do its business? Is it different from a commercial bank?KABERUKA: The African Development Bank, like the World Bank, is actually three institutions in one. You have the bank, which is a triple-A-rated institution. It is able to raise money from the capital markets very competitively and pass it on to customers for 20 years, again at very competitive pricing.Then you also provide soft loans … to countries that are not a great risk. And then there are countries — say like Liberia, Sierra Leone, Central African Republic — where it has to be grants. The money we raise from donors is simply for those poorer countries. But for other countries, middle-income countries, financial markets, we give them loans. And as a triple-A-rated institution, we are able to do so competitively.GAZETTE: Is there ever a conflict between running a financially sound institution and the need to invest in development projects?KABERUKA: We do not want to lose money, so we do this analysis carefully. The dividend we would like to give our shareholders [comes from] the bank side of the institution making a good profit, that we then use to fund low-income countries.So it is important that the bank side is as solid as it could be. We are not Bank of America, not Barclay’s. We fund projects on the basis of a number of metrics, including development effectiveness. We look at avoiding crowding out. If other institutions can do it, we don’t do it. We are prepared to take some risks which commercial institutions won’t, but at the end we want to keep the AAA as a solid bank, so it can make money to fund poorer countries.GAZETTE: Where are the African economies today? Do they still have the promise they had a few years ago, and, if so, in what areas do you see that promise being?KABERUKA: Africa is part of the world, so we cannot avoid the global slowdown in the emerging markets or the prolonged after-effects of the global financial crisis. But I’m telling you African economies have fared much better than expected and much better than in other parts of the word. A large number of economies are still growing very strongly.And, contrary to what people might think, this is not about commodities. It is not about oil and gas, and minerals. It is mainly about investment. It’s about the internal market and consumption, about growth in regional trade, but also the improvement in policy and fundamentals.Now the recent decline in commodities is an issue for some countries that depend on one or two commodities. But there is room for fiscal adjustment to take care of [them]. So I remain very confident that, provided African countries keep the good policies of the last decade, we can overcome this particular [problem]. That said, there are two challenges we must overcome. The first challenge is one of job creation for Africa’s growing youth. We are a young continent, so job creation that comes from transforming our economies and moving up the global value chain is critical for every single country. Number two, the issues of inclusion and inequality … It’s about sharing the prosperity so they don’t have very wealthy people amidst a sea of poverty and misery, for that is neither politically sustainable nor economically sensible.GAZETTE: Do you see the consumer market being a major driver in future years?KABERUKA: Absolutely, domestic consumption has been a major driver of recent growth. This has been facilitated mainly by increased internal migration, not simply in large cities but even in small towns, the wide spread of simple technologies like mobile phones, which has increased access to financial services, improved knowledge of what is available in the world. So I expect that in coming years investment, domestic consumption, and growing regional trade will be key drivers, provided we are able to address the issues of jobs and inclusion.GAZETTE: It sounds like you’re pretty confident that this road of democracy, increased stability, and economic growth is a sustainable one?KABERUKA: Of course, nothing is preordained. It all depends on consistency of policies. It depends on what happens in the world, and I’m hoping this crisis in emerging markets will be dealt with. But you know behind every cloud there’s a silver lining. And the silver lining for African economies is the rising real wage in China. Because these companies, whose margins are being squeezed in China, are going to invest in Myanmar, Vietnam, Laos. But now they’re looking at other places, most likely India and Africa. So the next time you go to Ethiopia, you’ll be amazed at the number of Chinese factories and manufacturers around Addis Ababa. And I would like to see that happening more and more.So the slowdown among the large emerging markets and the shift of the Chinese economic model from export-led to domestic consumption-led and increases in real wages might actually open opportunities for some low-income countries to create jobs in their countries.GAZETTE: Is China the biggest development force in Africa today, as far as external countries?KABERUKA: China has been a major player in infrastructure. Definitely, there’s no doubt about this — energy and transport. I think the relationship between China and Africa has been in transformation, but I should tell you that in some countries, Turkey is bigger than China. In other countries Malaysia is bigger than China … There is too much focus on China sometimes, because of the high visibility of what they do. But I think it has been a very productive relationship with all the large emerging markets. Of course, we’re not forgetting our traditional partners.GAZETTE: What about the African economy is most exciting to you right now? Is there a particular project or trend that is most exciting when you think about 10 years in the future?KABERUKA: For a long time, the narrative about Africa was about commodities, what can we get from them? Oil and gas, copper, cobalt …I think as President Obama was saying at the last U.S.-Africa summit: Look at Africa as an opportunity for investment. Why an opportunity for investment? Because of its demographics. We’ll be 2 billion people not that far from now.This is a continent where the demographic depth … the penetration of the simple technologies, and diversification of partners means that it is a continent where the future markets lie. If you’re looking for a short-term kill, you could have a problem. But if you’re there for the long term, this is the place to be. The opportunities are related to the demographics, so there is increased demand for all kinds of services, financial services, health care, education. There will be demand for new technologies, so I think if you had to ask me where the future opportunities are, they’re related to the demographic dynamics.GAZETTE: Let’s talk about your role here …KABERUKA: I’m a Hauser Senior Fellow at the Kennedy School.GAZETTE: What do you hope to accomplish during this year?KABERUKA: I hope to share, like I’m doing now, about development … in Africa. I hope to share with colleagues here at Harvard and students and, hopefully, the wider public, American companies, about opportunities on the continent. I welcome very much the offer the Kennedy School gave me to do this. For the few months that I’m here, that will be my main preoccupation.GAZETTE: And had you been to Harvard before?KABERUKA: I used to come to Harvard in my previous function as a speaker, so I’ve spoken several times at the Law School, at the Kennedy School, so yes, I’ve been here a couple of times. And of course, at the bank I have recruited many staff from here, and many from Harvard Business School, Harvard Law School, the Kennedy School. We know the University very well, and it has been a pleasure working with many of the graduates, both African and non-African.GAZETTE: How about post-fellowship, do you have any plans?KABERUKA: I am going back to my continent. That is where I belong for this task of attracting more investment in Africa and encouraging the dynamics, which I think are both challenging and exciting.GAZETTE: Is Rwanda still your home? You grew up there, right?KABERUKA: Yes, Rwanda is my home … but I’ll be active across Africa.GAZETTE: You were finance minister there before. Do you see a role in government, or will your activities be more across Africa?KABERUKA: I see myself as bringing my knowledge, my experience to bear — my network — across the African economic space. While in my country, that will get special attention, but I want to bring my experience to bear for all of the 54 African countries.last_img read more

We’re getting right balance – Dyche

first_img “We take that side of things seriously, the development of players no matter what their age is, and if they choose to run with our ideas and our thinking, it’s been pretty positive so far the outcome that they’ve got, which of course affects the team in a positive manner. “We’re looking to work with all the players, no matter what age. We want them to improve, we want them to engage and be aligned with what we do. “It’s important as a team we are totally aligned on the outcome, and that is delivering good performances in order to get wins.” The partnership between strikers Vokes and Ings was key to Burnley’s promotion last season, the pair netting 41 league goals between them. Ings will be looking to pick up where he left off on Monday but Vokes must wait until later in the season for his chance after rupturing a cruciate ligament in March. “He’s still a while away yet but he’s doing really, really well,” Dyche said. “There’s no timescale – we wouldn’t do that to a player with that type of injury. He’s been out on the grass, very light training. Not with us, with the physios, but he’s going well and he’s in good spirits. “He’s a great character. He’s someone who’s done fantastically well and will do again.” Burnley boss Sean Dyche hopes he has the right balance in his squad to succeed in the Barclays Premier League. With a small budget, Dyche’s options are limited anyway, but the former Watford boss is also determined to keep the squad dynamic that proved so important last season. Midfielders Matt Taylor and Steven Reid have added a lot of top-flight experience, while strikers Lukas Jutkiewicz and Marvin Sordell, winger Michael Kightly and goalkeeper Matt Gilks have also come in. Dyche said: “We want to find a balanced group in Burnley’s world, both financially and what we think is right for the group and how we operate. I think we’ve done that so far and we are looking to add further. “Obviously the two main lads with experience we’ve brought in are Steven Reid and Matty Taylor. “They’re still active, they’ve made it clear they are by getting games under their belt in recent seasons, but they also have that real depth of Premier League knowledge about going around the country and playing at all the Premier League stadiums and I think that’s important because it gives that balance to the group.” Jutkiewicz, 25, is already on his ninth professional club having joined the Clarets from Middlesbrough last month. He impressed on loan at Bolton last term and was Burnley’s star turn in pre-season, scoring six goals in as many games. “He’s open-minded, big Juke, and we like that,” Dyche said. “(Sam) Vokes proved last year how open-minded he was and (Danny) Ings, the way we work and the way we operate. The Clarets play their first match back in the top flight on Monday when Chelsea visit Turf Moor. Dyche has so far resisted the temptation to make wholesale changes to the squad that finished second in the Championship, adding only six players to what was already a small group. Press Associationlast_img read more

The Latest: Swiss soccer clubs aiming to restart on June 19

first_imgAguero will race for Red Bull alongside Albon. Courtois will run for Alfa Romeo in his second virtual race. Arthur will be with Haas.Golfer Ian Poulter will make his third appearance with Renault.The virtual Spanish GP will take place during the same weekend the real race was scheduled to run at the Barcelona-Catalunya circuit. The race will consist of a qualifying session and a 33-lap race.The F1 season hasn’t started yet because of the coronavirus pandemic.___ ___The International Canoe Federation says it is planning its budget in case the Tokyo Olympics get canceled in 2021 because of the coronavirus pandemic.The ICF says its board “approved two budget scenarios” up to 2022 taking into account “the chance of no competition or Olympics in 2021.”The ICF is due to get about $16 million from the International Olympic Committee as a share of revenue from the postponed Tokyo Games.The ICF has postponed or canceled all international events through August. It is due to have an election congress in December when president Jose Perurena steps down after 12 years. Aulas argued for a playoff system to end the league by late August and reserved the possibility to claim damages he estimated at tens of millions of euros (dollars).___The Kontinental Hockey League says it will not name a champion after it stopped the season part-way through the playoffs because of the coronavirus pandemic.The Russia-based league shut down in March but didn’t immediately decide how the final standings would be determined. The league is widely considered to be the strongest outside the NHL.The KHL says the eight teams still in the playoffs at the time the season ended will be ruled as jointly finishing in the top eight positions. Share This StoryFacebookTwitteremailPrintLinkedinRedditThe Latest on the effects of the coronavirus outbreak on sports around the world:___The Swiss soccer league says clubs will discuss on May 29 if they want to resume playing in June amid the coronavirus pandemic. Seifert was speaking after a video conference with members from the country’s 36 clubs in the top two divisions. The second division will also resume on May 16.___The French Tennis Federation says it will refund tickets purchased for the French Open because of uncertainty related to the coronavirus pandemic.The clay-court tournament at Roland Garros was initially slated to be held May 24-June 7 but has been rescheduled for Sept. 20-Oct. 4.The FFT says it “has taken the decision to cancel and refund all tickets purchased for the original dates of Roland Garros.” The president of French soccer club Lyon says he hopes the resumption of the German league can prompt a reversal of the decision to end the season in his own country.The top two leagues in Germany have been given the go-ahead to play in empty stadiums following a meeting between Chancellor Angela Merkel and state governors.The 10 remaining league matches in France were canceled last week. Paris Saint-Germain was declared champion and Lyon finished outside the European places in seventh.Lyon president Jean-Michel Aulas says on sports daily L’Equipe’s website “it might not be too late to imagine … something coherent on a political level.”He adds that “by adapting our methods we could probably have finished the league.” More teams are returning to full-team training instead of working in small groups. Borussia Mönchengladbach is resuming full training despite what it called “very weak positive” coronavirus tests for one player and one staff member. The club says the player has since tested negative twice and the staff member is isolating at home after one negative test.___Brescia captain Daniele Gastaldello says his entire squad opposes resuming the Serie A soccer season amid the coronavirus pandemic.Gastaldello tells Italian daily La Repubblica “we don’t feel safe. They’re asking us to resume training and to get back out onto the field right away … It’s putting all of the players’ safety on the line.” The Gibraltar soccer federation says it has declared the league season null and void with no champion.The top two teams in the league were Europa and St. Joseph’s when the coronavirus pandemic caused the season to be suspended. The federation says they were so close in the standings it could not declare a champion “in the interests of sporting integrity.”The federation said last week that on government advice the season could not be completed by a UEFA-set deadline for Gibraltar of July 20.Europa will enter next season’s Champions League qualifying rounds. St. Joseph’s and third-place Lincoln Red Imps will enter the Europa League.___ May 7, 2020 The FFT is also working closely with French authorities “to establish the necessary measures which will ensure the health and security of all guests attending the tournament.”Refunds will be received by end of May and a new ticketing procedure will be opened if the tournament goes ahead.___Formula One says Manchester City forward Sergio Aguero, Real Madrid goalkeeper Thibaut Courtois and Barcelona midfielder Arthur will compete alongside drivers in this weekend’s virtual Spanish Grand Prix.Charles Leclerc, Lando Norris, Alex Albon, Antonio Giovinazzi, George Russell and Nicholas Latifi will be the F1 drivers in Sunday’s event. ___German soccer league managing director Christian Seifert says the Bundesliga season will resume on May 16.The matches will be played in empty stadiums because of the coronavirus pandemic.The announcement comes one day after Chancellor Angela Merkel and the country’s 16 state governors agreed the season could resume.The Bundesliga was suspended on March 13 with nine rounds remaining. Seifert says the league will begin again where it left off. Associated Press The league says the meeting of the 20 clubs will be two days after the next Swiss federal government update on easing restrictions.A restart on June 19 leaves seven weekends and six midweek games to meet UEFA’s preferred Aug. 3 target to complete domestic seasons.St. Gallen leads defending champion Young Boys on goal difference and is five points ahead of third-place Basel.Switzerland’s government has said professional clubs can resume training Monday. Games in empty stadiums should be possible from June 8.The league says the government has advised that teams are no longer eligible for an unemployment insurance program when players start training. The league says it is having “very constructive” talks with the government about further federal aid. He says “I’m speaking for me and for my teammates” and adds it’s not worth it “if the price of resuming is us getting seriously injured.”Most clubs in the Italian league are resuming training on an individual basis this week but last-place Brescia is one of the holdouts.Brescia is one of areas hit hardest by the virus but Gastaldello says he was never tested.He says “we’ll know if we’ve had it only once they test us before training.”Brescia president Massimo Cellino has also been a vociferous opponent to resuming the season but says it’s not because he wants his club to avoid relegation. The Latest: Swiss soccer clubs aiming to restart on June 19 ___Soccer clubs from Germany’s top two divisions will discuss setting a date to resume the suspended season amid the coronavirus pandemic. It could be as soon as next week.The German Football League’s board reportedly favors a start date of May 15 but some clubs want it later.Werder Bremen sporting director Frank Baumann backs a May 23 start to “reduce the injury risk” with more training and because some clubs were cleared to return to training earlier than others. Mainz wants two weeks to prepare.The league was given the go-ahead Wednesday to play in empty stadiums following a meeting between German Chancellor Angela Merkel and state governors. The Italian government has not yet approved the resumption of the season.___More AP sports: https://apnews.com/apf-sports and https://twitter.com/AP_Sports,Tampa Bay Lightning advance to face Dallas Stars in Stanley Cup finals, beating New York Islanders 2-1 in OT in Game 6last_img read more