Africa Green Media

 

Further to fellow MercatorNet blogger Jotham Muriu Njoroge’s “African nations rank high on ease of doing business 2015,” it appears that some international players have noticed.

But first, to recap Njoroge: 

Countries from Sub Saharan Africa were amongst those that ranked high on the various lists and indexes in “Doing Business 2015”. Mauritius, for instance, was first on the “Ease of doing Business Index” and in the 230 business reforms recorded worldwide, over half came from African countries, mainly dealing with the reduction of complexity and costs in starting a business. A quarter of the global reforms concerning the strengthening of legal institutions also come from Africa. Five of the countries that were ranked among the top ten in economic progress were from Sub Saharan Africa, and Nigeria was on the same page with 10 other countries comparing the ease of doing business at a city level.

That’s good news. Many countries have thrown off foreign rule only to discover, human nature being what it is, that there can be equal or worse tyrants at home.

Bluntly, the world over, some people who won’t and maybe can’t make a living working are happy to make a living by impeding the efforts of those who do (obstructive bureaucracy).

Insecure governments may be more inclined to give them free play than others would. And prying them loose is often difficult. But not impossible:

This goes to show that as more countries in Africa are maturing politically, and their populations are being better educated, a corresponding economic growth is being felt strongly enough to feature in documents concerning global business. More

Reforms sometimes rush ahead of capture in data. For example, as Nation tells it, the Kenyan government has emphasized that it is ahead of such reports:

Mr Mohamed said on Wednesday that the survey did not include reforms undertaken by the government in the last one year and, therefore, did not reflect the current situation in the country. ][“These latest results do not capture the reforms undertaken by the government in the last 12 months. We see an improving business climate as a result of the reforms that various government agencies have undertaken, but more needs to be done,” Mr Mohamed said. (29/10/2014) More.

According to an article (August 15, 2014) in the Wall Street Journal—unfortunately, paywalled—banks are vying for a share in Africa’s mobile banking market:

In Kenya, where telecom companies dominate the mobile-payments market, one of the country’s largest banks is fighting to retake some of its traditional turf.

George Kabiria, who makes decorative sculptures for this city’s lush garden homes, recently sold a small iron frog to a customer through M-Pesa, Kenya’s most popular mobile-payments service. Mr. Kabiria’s customer punched in a few numbers and transferred 700 Kenyan shillings, or about $8, to the iron monger.

Mr. Karbiria, for example, avoids keeping cash in his shop in high-crime Nairobe. He thus appreciates the relative security of Kenya’s M-Pesa ($18 billion annual transactions as of 2014), controlled by the Vodafone Group, totalling 43% of Kenya’s economy. In short, Kenyans like banking by phone.

A Kenya bank, Equity Bank, has been challenging Vodaphone’s dominance. But if all goes well, Equity will need to make clear why it is a better choice from the perspective of the customer. At stake: In sub-Saharan African, nearly a quarter of the population banks on mobile phones whereas only a minuscule proportion of Europeans and Central Asians do (416 per 100,000).

When considering these stats, two factors are worth noting: In many developing regions, land lines are no longer being built, as they were elsewhere in the past. Mobile phones simply make more logistical and environmental sense.

So, for example, while many Canadians bank by (land line) phone, that is because the land lines already exist, and the resident pays for them anyway. In Kenya, the same people would probably bank by mobile phone. Phone banking participation statistics can be somewhat skewed if such factors are ignored.

Second, reliable access to the Internet matters too. Paperless billing has become much more popular in recent years than anyone who owns six four-drawer filing cabinets had ever anticipated.

The trend to mobile banking can certainly help developing countries, by bypassing traditional constraints on growth.

No banking means no credit rating, for example. That restricts business to dealings within a close, often clan-based system, which unintentionally but certainly inhibits sharing of knowledge and technology. Especially for women. 

On the other hand, avoiding fraud and other crimes may prove a complex problem for the future, for all of us in years to come. Here’s a 2015 KPMG vid on banking issues in Africa:

 

Denyse O’Leary is a Canadian journalist, author, and blogger.

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Denyse O’Leary is an author, journalist, and blogger who has mainly written popular science and social science. Fellow Canadian Marshall McLuhan’s description of electronic media as a global village...