No. 51 – 3AMReads: Mozambique and Ivory Persist and Attract Capital | African Development Bank Makes Case for Investing in Africa

Bloomberg: Traders Snap Up Assets of Nation Where Default Is New Normal

I’m not really sure what to make of this article. I wrote a several weeks ago about how I was nervous about hedge funds investing in countries like Mozambique. While the independent audit of the country’s finances seems to have given investors increased confidence in the country, are we certain Mozambique is rounding the corner in being able to make it’s debt payments? I’d hate to see this turn into a situation where investors just have more assets to play with in order to get their money.

Reuters: Ivory Coast says long dated Eurobond raised $1.25 bln, 625 mln euros

Despite the tensions with its military, Ivory Coast continues to attract capital. Good stuff.

African Development Bank: Adesina – Its time to reboot and boost US-Africa Commerce and Investments

The Corporate Council on Africa is hosting is US-Africa Business Summit this week. Is Commerce Secretary Wilbur Ross speaking at the Summit a signal that we’re a few inches closer to seeing the US start to roll out bits of an Africa policy?

 

No. 40 – 3AMReads: AFC Head Makes Case for Infrastructure | GM Sells South Africa Operation 

Africa Finance Corporation CEO Makes Case for Infrastructure Investment

Andrew Alli is one of my favorite people to follow on Twitter. He is witty and always provides forthright analysis. During the celebration of the Africa Finance Corporation’s 10 years in business, Alli shared some observations on the importance of infrastructure in Africa. His admonishment to focus on working with companies that can scale and fixing the currency situation so that deals aren’t be done on US currency which is more risky. 

GM Sells Off South Africa Operations 

The auto industry is going to be really interesting to watch across the continent over the next several years. As global automakers fight for market share in a pending environment where ridesharing, autonomous driving, etc will be royalty, African countries still tangling with blackouts/brownouts just isn’t acceptable for a player like GM. The company can take its investment in a market like South Africa and drill down a bit further in a market like China where the path to seizing on huge growth potential is more visible. 

News like this crystallizes Andrew Alli’s statements about the critical role infrastructure investment plays in unlocking wealth on the continent. Foundational infrastructure combined with a wealthier consumer makes a more attractive investment for a GM. 

This piece also just brings back thoughts of where we’re going with technologies like artificial intelligence. Africa has to get the infrastructure right to be able to play in these spaces.

No. 24: Three AM Reads – Hedge Funds in Africa | Africa’s Cities are Big, but Isolated | Artificial Intelligence

A Case for More Hedge Funds Investing in Africa

Kurt Davis makes an interesting case for why it makes sense for hedge funds to be more active in core sectors across African markets – financial services, metals and mining, oil and gas, and agriculture and land. I admit that I bristled a bit at the thought. I’m still wincing from the episode in Billions when Bobby Axelrod, desperate to salvage his quarter, corrals a group of billionaire head fund managers to short the Naira and speed up its devaluation. The thing is, this sort of scenario isn’t a potential bad dream. Anyone remember George Soros breaking the Bank of England?

Hedge funds increasing their activity on the continent could be a real thing. I’m sure the industry already has a good bit of exposure during the Oprah-like bond issuance party African countries engaged in to raise capital for things like infrastructure investments or fiscal deficit management. That makes me nervous in situations like what Mozambique is going through right now, defaulting on its debt. That’s not what you want if you have activist investors like Elliott Management buying $100M of your debt, then dragging your country through courts around the world, seizing one of your historic ships in Ghana, and forcing you to a deal where they flip their $100M into a $2B payout. Just ask Argentina.

That said, hedge funds could play an important role in moving sectors along in their growth. Folks who are working with hedge fund money should just be sure that they’re doing everything possible to ensure things don’t go left. You don’t want that kind of stress in your life.

Africa’s Urbanization Problem

Daniel Knowles, in typical Economist Magazine style, applies sharp cynicism to the urbanization of Africa’s largest cities, arguing that while millions have added to their folds, they are just as isolated from the globalization taking place around the world. I can’t really argue with him.

He starts his case with Kinshasa, but my mind goes to Nigeria where Nnamdi Azikiwe International Airport was closed for six weeks to repair its lone runway. This isn’t a random airport. This is an airport for the capitol city Abuja. Imagine Hartsfield-Jackson closing down in Atlanta due to road resurfacing. I probably shouldn’t even mention that considering the infrastructure issues Atlanta is having these days, but I digress. The airport reopened last week, but caused a lot of inconvenience for transport to and from the city. We’ll have to wait and see what the economic impact the closure had on the economy, but I’m sure it wasn’t good.

As we move into an age shaped by the internet of things and artificial intelligence, it is going to be critical that Africa’s hubs are not stalling out. It is critical that leaders have the basics at good place, such that they have sufficient bandwidth to think through how to engage with a world of self-driving cars, robots, and human brains meshed with computers.

Speaking of Artificial Intelligence

I’ll leave you with an interesting list of African startups making their way through the world of machine learning and artificial intelligence. I look forward to adding these to my list of startups to keep an eye out for. It’s really important that African startups play a role in the development of these technologies. I’m working through The Singularity is Near: When Humans Transcend Biology by Google engineering director Ray Kurzweil. The future world people are dreaming up is starkly different from the one we live in and Africa really needs to be in the game. My fear is that if Africa isn’t part of shaping an AI world, it’s resources and people will become commodities in the sustenance of that world.

Queen of Katwe

Last year, I wrote about my frustration with the difficult time I was having finding a movie about a black princess that my daughter could watch.

As you can imagine, when I saw that Disney was coming out with a movie called Queen of Katwe, I was thrilled.

When I finally watched the trailer, I was further surprised to see what the content was about. You’ll have to check out the trailer to know what I’m talking about.

Kudos to Disney for telling a different story. As time progresses, I look forward to Disney exploring more of Africa’s history and telling her stories.

Lumumba Was Here

Wrote this last year.

Kwame Som-Pimpong

Yesterday was the 54th anniversary of the assassination of Patrice Lumumba, independent Congo’s first prime minister.

Georges Nzongola-Ntalaja, one of the first blacks to attend my alma mater, wrote a nice piece on the importance of Lumumba and his death. He recently published a biography of Prime Minister Lumumba that I look forward to reading.

Here’s a letter Lumumba wrote his wife, Pauline some time before his death.

Tomorrow, we celebrate the life of Martin Luther King, Jr.

Tuesday, President Obama gives his State of the Union address.

Lumumba and King were decades younger than President Obama when they died. It’s incredible how productive they were in such a short time. Much more work to be done still to realize their massive dreams.

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Top Posts of 2015

I got this email earlier today from WordPress recapping the year, so I figured I would share the top posts from the year.

1. What Does a Black Princess Look Like?

My daughter calls herself queen now, and me king. I’m not quite sure where she got that, but I smile wide every time I hear her refer to herself as that.

2. Why I Do What I Do?

It was helpful reading this again.

3. Thoughts on David Brooks’ Letter to Ta-Nehisi Coates

After writing this, I felt like I should apologize. There is nothing particularly forceful about it. Just a bit more honest about what I believe these days. I read it again before putting this post together and still felt an apology forming in my mind. An apology for putting distance between me and those who think they are white. For writing in terms of “them”. An apology for speaking plainly. That’s a frustrating feeling.

4. Osiakwan: Africa’s Time is Now

Here’s to Eric and Chanzo Capital scrapping for Africa’s potential.

5. Help Me With My Blind Spots

I’ve seen more blind spots since I wrote this post, thanks to my friends. I’m very grateful for them (my blind spots and my friends).

Here’s to more words (hopefully productive ones) over the next year.

Where Can I Buy African High Fashion?

Africa’s fashion industry has the potential to be massive and you should pay attention to it.

When I found out that Akin Adebowale, Kolade Adeyemo, Bobby Pittman, and the rest of the team were building Oxosi, I couldn’t wait to see what they would come up with.

Oxosi is an e-commerce platform that brings African high fashion to the US. Place your orders! Parts of African fashion have impacted taste in the West for a long time. It is good to see the creators of African fashion get credit for their genius through platforms like this.

The team has raised a good bit of money to start off and if their bet on the appeal of African high fashion in the US hits, Naspers and Tiger Global, two of the biggest investors in e-commerce out there, should pay attention.

Kudos to the Oxosi team. Here’s to, in the words of Paul Judge, building something from nothing.