Mother Ghana is Struggling

My neck hurts after shaking my head while reading this Economist piece on Ghana’s economic woes. Some highlights:

  • Public debt could reach 70 percent this year
  • The Ghana Cedi has lost over 99 percent of its value to the dollar (Keep in mind Ghana switched from the New Cedi to the Ghana Cedi)
  • Since 1966, Ghana has sought IMF help 16 times

Elections are coming up next year, so we will probably see more spending. President Mahama has a lot of work on his hands in the lead-up. I imagine he will cite progress made on addressing power issues and the exploding budget, and that he should be re-elected to continue righting the ship.

Elections are a lot of work. Perhaps, the better move would be to not seek re-election, double down and get reforms right over the next 18 months, and hand off an improving situation to his successor.

Shoutouts 

There should be an app that tracks when you’re bragging about your friends and sends them updates when you do. 

One of my good friends and daughter’s godmother, Livi, is pursuing her PhD at the University College London and got upgraded from a Master’s candidate to a PhD candidate a few days ago after writing a chapter of her thesis and giving a lecture to the faculty. I’m extremely proud of her. In college, she would talk about pursuing one and to see her reach a major milestone in that goal is super inspiring. 

My little brother, Kwadwo, just released a new short film called Yours Only. It’s a dope mix of a dystopian future and folks who take a moment to worship in the midst of a tough situation. 

The youngest Som-Pimpong sibling, Delali, just graduated from middle school and got an award for how she embodied the ethos of her school. I’m super proud of the beautiful young woman she is. I pity the fool who steps to her incorrectly. I’ve been picking up serious weight in the gym. 

This list could go on. It’s so awesome watching friends and family take big steps in their lives. 

Improving My Podcast Listening Experience 

Imagine navigation apps like Waze and Google Maps being able to recognize what podcast or radio show you’re listening to and adopting the voice of the host or artist you’re listening to in providing directions. 

Waze currently overshadows my podcast listening.  The volume on the podcast I’m listening to lowers when the Waze navigator tells me where to turn next. Because of this, I miss little details in the episodes. Integrating the directions more cleanly into whatever I’m listening to would be great – have the podcast content stop, replaced by the next set of directions in the voice of whomever I’m listening to.

There’s got to be the technology to do this. Google just updated Google Now to provide more contextual support for users. For example, if you’re texting with your friend about what movie you will, you can call up Google Now without leaving the text application. Google Now will read your text and pull up information on the movies you and your friend mentioned in your texts. There’s got to be a way to port that kind of machine learning to how apps interact sonically.  

What Does a Potential Liberty Global-Vodacom Deal Mean for Safaricom?

Liberty Global and Vodacom are in talks for some sort of deal. Early rumors were that the two were considering a merger, which would be one of the biggest ever, but Vodacom denies a merger being part of deliberations. 

What’s interesting about this news, besides John Malone continuing to take over the media world, is that Vodacom has a 40 percent stake in Safaricom, Kenya’s leading telecommunications provider. If a deal happens, could Vodacom sell off Its stake in Safaricom while spinning off its Middle Eastern and African subsidiaries like Vodacom Ghana and Vodacom Egypt?

The global media world is in consolidation mode. You probably heard about DirectTV potentially acquiringT-Mobile. John Malone’s Liberty Broadband is backing the proposed Charter-Time Warner merger. In Europe, where Liberty Global and Vodacom are based, telecom providers are pushing quad-play – television, mobile, telephone, and Internet. A deal between the two companies would probably position them to compete in this market. 

Safaricom is entering the bundling competition in Kenya, recently seeking regulatory approval to offer television services. Perhaps, it would benefit from a Liberty-Vodacom deal by gaining access to intelligence on how to best compete in this space. I think Liberty and Vodacom could benefit from tapping into Safaricom’s expertise in mobile banking and figuring out how to incorporate that into a bundling strategy. 

Why Akinwumi Adesina Won the African Development Bank Presidency

Bobby Pittman, head of Kupanda Capital, did a nice interview with the Center for Global Development where he serves as a board member alongside the likes of Ngozi Okonjo-Iweala and Lawrence Summers. He highlights the reasons Dr. Adesina won the AfDB presidency, and some things on which he will have to focus. Three points that stood out are:

  1. The AfDB picked a lot of low-hanging fruit in developing the private sector on the continent. Now that the private sector has advanced significantly, a lot of thought has to go into how to most effectively catalyze the private sector. Dr. Adesina has the track record and skill set to take the development of the private sector to the next level. 
  2. The AfDB’s focus on areas like the private sector, infrastructure, and regional development, in comparison with other development banks has contributed to its success. Maintaining that focus will continue to position the AfDB for success. 
  3. There are a lot of voices that could be part of the AfDB’s conversation, but are not currently. Work has to be done to incorporate their viewpoints into the AfDB’s work. 

I am excited about Dr. Adesina taking the reins at the AfDB and look forward to seeing the bank continue to do good work on the continent. 

Corruption: FIFA or Wall Street

A couple of weeks ago, several banks agreed to pay criminal fines close to $9 billion for currency rigging, a felony crime. Around the same time, the corruption deal with FIFA started heating up. 

I get that billions of people love the beautiful game and the corruption in the sport has been ongoing for decades. It was definitely time for something to correct that. A total of nearly $9 billion in fines is enormous. Rate fixing is a serious crime, yet the banks involved got exemptions from criminal charges. 

I often hear Wall Street saying that the markets will take care of themselves, as if we’re talking about some all powerful, all knowing being. Really? Since the beginning of time, people have tried to cheat people when it comes to getting something valuable. 

We just went through several painful years during the Great Recession. Some of the same banks involved there faced fines in this case – J.P. Morgan. Citigroup. Corruption in FIFA will negatively impact people’s lives, but hubris on Wall Street could negatively impact a lot more people. 

Why You Should Pay Attention to Africa’s Retail and Fashion

For us, today, Africa is more important than the U.S. In five to 10 years, Africa can become the new frontier for luxury. – Ermenegildo Zegna

While reading this Quartz piece on Africa’s fashion opportunity, I came across this Global Retail Development Index put together by A.T Kearney. The Index ranks the top 30 developing countries for retail investment based on market attractiveness, country and business risk, market saturation, and time pressure. Time pressure relates to how quickly a country’s retail sector is growing. If it is growing really quickly, a retail investor needs to move fast to take advantage of growth before it’s too late.

Botswana (18th), Nigeria (23rd) and Angola (30th) are on the list for 2015, with Ghana, Zambia, and Namibia on the verge of breaking onto the list.

The report points to Sub-Saharan Africa mirroring China in 1987 when retail brands were beginning to enter the country. Nearly 30 years later, retail growth is extremely fast and retailers are beginning to really focus in on profitability now that they are approaching scale. The authors of the report believe Africa could be at this point in 2040 or so, though it will probably be a bumpy ride.

One of my mentors was recently telling me about the tens of thousands of dollars of champagne his clients bought during a night on the town in Lagos a few years ago. It’s no secret that Nigeria’s wealthy have a lot of disposable income and that champagne is in demand on Banana Island. I had no idea, though, that retail sales of champagne in Nigeria was second only to France. The report authors point to this as an anecdote on the opportunity for luxury brands in Sub-Saharan Africa.

Speaking of luxury, Hannel Rupert, a South African entrepreneur, wrote an op-ed in Business of Fashion calling for luxury brands to partner with Africa’s fashion industry, moving beyond fashion for charity campaigns or one-off collaborations. A good place to start, in her opinion, is to bring some end-process manufacturing to countries like Ethiopia, Cameroon and South Africa which have strong capabilities in areas like leather crafting.

I worked on a retail project a few years ago, working with a client who had quality issues with its product lines but wanted to figure out a way to tap in the U.S. retail market. Established brands bringing their expertise on details like this could help deal with issues like this. At the same time, there are already a burgeoning number of African fashion shops that put out really high quality material. Having access to end-process manufacturing that matched their products could help them reach scale in Africa and the rest of the world.

As an aside, I finally watched Jidenna’s Classic Man music video. Does anyone know if Ikire Jones made the white blazer Jidenna wears in the film?

As a further aside, Angola made the list for the Global Retail Development Index. I’m sure a lot of folks immediately thought about Luanda’s high cost of living. The New Yorker has a piece in its June 1 issue on the inequality of Angola’s oil boom. The author cold have spent more time on the U.S.-Russia proxy war. Over the decades that Angola was in civil war, how U.S. support did Jonas Savimbi and UNITA get? What more detail can we get about the Heritage Foundation, Grover Norquist and Jack Abramoff supporting Savimbi? How was President dos Santos able to maintain control in the face of a U.S.-supported rebel group? How did all of that contribute to Angola’s current political and economic environment? Just a few questions the author could have explored.

Back to fashion. The Quartz Africa piece mentions McKinsey’s Lions on the move report that came out in 2010. The authors forecasted spending power in Sub-Saharan Africa reaching $1.4 trillion by 2020. Perhaps a halfway-point check-in on how the continent is doing relative to that forecast is in the works?

This African fashion conversation is very exciting and I look forward to seeing where it goes. As of late, President Muhammad Buhari’s swagger has had me thinking about taking Traditional Wear Fridays to the next level and pulling out the Fugu.

Photo credit: Daily Mail | Nigeria