For the last episode of the year, Tara and Karen give a whistle-stop tour of current news stories from across Africa. This week’s guest is a dynamic man from the world of food. A former East African Coca-Cola executive voted among the top 100 business leaders in Africa by Forbes Afrique, Peter Njonjo is the founder of Twiga Foods, the Kenya business-to-business food distribution platform which is disrupting the way small store holders in cities like Nairobi access produce from farms, bypassing the middleman and using the latest digital technology to force prices down.
Corruption undermines democratic institutions, slows economic development and contributes to governmental instability. It is no coincidence that the most corrupt countries in the world are also on the Fragile States Index. Many of these countries are in Africa. ARC continues to work with businesses operating in Africa to mitigate the risks posed by corruption and bribery. In 2021, we will be hosting a series of anti-bribery and corruption training events, we look forward to sharing more details on this with you soon. Please get in touch now if you are interested in participating.
The United Nations General Assembly (UNGA) designates 9 December as International Anti-Corruption Day. It is a day for governments, businesses, civil society and the whole of society to renew our commitment to working together to end the devastating impact of corruption on people’s lives around the world. ARC was pleased to mark this important day by hosting an anti-corruption virtual event.
The main themes addressed included trends in corporate corruption, exploring the continent’s biggest corruption breakthroughs in 2020 and uncovering what lies ahead in 2021.
Tara was joined in this virtual conversation by Kenya’s former anti- corruption tsar John Githongo and Lord Peter Hain – one of South Africa’s “most potent weapons” in the country’s fight against corruption.
Email us now to receive the full recording.
ARC’s Tara O’Connor examines and provides insightful analysis on all major economic and socio-political developments in Africa over the last 12 months in her monthly column for one of the continent’s leading online news platform – Engineering News. Click here to read all articles from 2020 online now.
Karen Allen and Tara O’Connor spoke with Maya Famodu, an award-winning entrepreneur venture capitalist. Maya’s talent-spotting led to an early investment in Paystack, now the subject of a $200m buyout by US giant Stripe– the biggest start-up acquisition to date to come out of Nigeria and one which belies the country’s bankruptcy at federal level. Listen to the full episode here & subscribe to The ARC Insider here.
By Tara O’Connor for Engineering News, published on 11th December 2020.
As the first year of the plague closes out, a second year threatens a second wave of the Covid-19 pandemic. Africa has seen fewer infections and deaths, but the virus has had other lasting consequences.
The effect on political stability has been acute in several countries, and acute and destabilising in Africa’s largest economy, Nigeria. It is a political truth in Nigeria that, when the oil price falls below $40/lb, its trickle-down economics fail and people’s distress is manifest in unrest. Unsurprising then that a video showing a member of the notorious Special Anti-Robbery Squad (SARS) executing a suspect prompted protests nationwide. What was surprising was the actions of a purportedly civilian government – which was to deploy the military to a peaceful protest. The army opened fire with no warning, killing 56 protesters, in scenes reminiscent of the worst days of military rule, which ended in 1999. Read the full article here.
In conversation with Gillian Lusk…
The recent announcement that Washington has agreed to remove Sudan from a terrorism blacklist has been heralded by many as signalling economic hope for a country that is slowly recovering from living under a brutal Islamist dictatorship for 30 years.
The removal will be implemented on receipt of a compensation payment amounting to $335m. The compensation money is for Sudan’s role in the bombing of two US embassies in East Africa by al-Qaeda in 1998. The legal claims are brought on the grounds that Al Qaeda carried out the embassy bombings and that Sudan facilitated Al Qaeda’s activities. Both facts are undisputed. The National Islamic Front regime hosted Osama bin Laden for at least five years; he was an integral part of the system and a close ally.
However, the United States (US) government’s linking of the compensation payment to the delisting has come under scrutiny from commentators inside and outside Sudan.
The main objection is that the US government should find the money, as the Islamist regime laundered literally billions through international banks, many of which were subsequently penalised by Washington. Therefore, the US should not be seeking compensation from Sudan, a country in dire economic straits after 30 years of predatory Islamist rule.
Last week, ARC spoke with Gillian Lusk, a seasoned Sudan expert to hear her thoughts on the recent de-listing and what may lie ahead for the country.
Gillian Lusk first went to Sudan on a visit in 1975 and stayed for twelve years. She worked firstly as an English teacher in Nyala, Darfur, and in the Gezira, and then moved to Khartoum. There she worked for a couple of years as a rewriter and reporter at “Sudanow” magazine before going freelance, writing mainly for Africa Confidential, Deutsche-Presse- Agentur, the Times, the Irish Times and the BBC. In 1987 she became Deputy Editor of Africa Confidential, based in London, and Associate Editor some 15 years later. She has now “retired” but not from Sudan: she still follows Sudanese events on a daily basis. She also chairs the Society for the Study of the Sudans – United Kingdom (SSSUK). SSSUK brings together Sudanese, South Sudanese and others interested in the two Sudans, holding an annual Symposium, publishing a twice-yearly journal, “Sudan Studies”, and this year, holding webinars, two of which can be viewed at SSSUK.ORG She speaks English, French, fair Italian and school German, and can get by in Arabic.
As we exchanged the now commonplace remarks about the uncertainty that Covid-19 has prompted in all of our lives, Gill remarks that, of course, this uncertainty and living in fear under constantly fluctuating restrictions are routine for people in many countries, including Sudan…
ARC: Gill, great to have you with us today. We would like to start by asking you what people in Sudan are saying about the US’ recent announcement that it will remove Sudan from a terrorist blacklist.
Gill: There are all kinds of reactions. Generally speaking, the Sudanese are all overjoyed except for the caveats outlined above around compensation and the fact that no one trusts President Donald Trump (2017-present) or his acolytes. They have been wanting this for the last year since the Revolution and the process has been long and very drawn out. At the same time, it was Donald Trump himself who made the announcement and via a Tweet, too – a strange, and arguably offensive, forum to use to announce such a consequential policy change. Trump does not command widespread trust among Sudanese people. Most Sudanese I have spoken to in the country pointed out immediately that he isn’t the only one responsible for this decision; it has to go to Congress. And in Congress, there are two Democrat senators pushing very hard for Sudan to pay compensation, not only for the East African bombings in 1988, which killed 224 people and injured hundreds more, but also for the September 11th attack on the World Trade Centre in New York and the Pentagon in 2001.
As Sudan has been declared legally partly responsible for the US Embassy bombings due to its facilitation of al Qaeda, which is the grounds for the compensation claim that has already been agreed upon, then of course it also facilitated 2001, and anything al-Qaeda and other Islamist groups have done with the help of the former Sudanese regime. It is no secret that the Sudanese government fully cooperated with al-Qaeda founder Osama Bin Laden. This was well known before but the Western media, and often Western and other officials, ignored it. If you had written that at the time in Sudan, before the former regime had been toppled, you might well have been killed.
ARC: So, there is a chance that this compensation amount could in fact increase when the decision goes to Congress?
Gill: It’s unclear. But the Sudanese people are puzzled by the fact that the very people who have just overthrown an Islamist dictatorship are now being called upon to pay for the crimes of that dictatorship. I know that this is international law to inherit the debts of a predecessor government, but the country hasn’t had rule of law for the last 30 years. Using the explanation that it is international law to a younger generation who have not known anything else or been taught about law, democracy or human rights is not easily accepted by them.
ARC: There have been a lot of reports in the last few weeks of protesters once again back on the streets protesting, what is behind the current protests?
Gill: There are different protests going on currently. I think the first calls to protest in October were by the Islamists of the former regime. They are trying to overthrow the transitional government, so they are doing everything in their power to call attention to its faults – which of course are many. However, the recent Islamist protesters in Khartoum were bussed in from all over the country by powerful members of the former regime. They did this because they are unable to get any support for their cause in Khartoum these days. By all accounts, they didn’t have enough anyway. Most people I have spoken to said they didn’t see very many Islamists at the protests held last week.
For those who are anti-Islamist, which is the overwhelming majority, the main trigger to come out in support of these recent protests is that they are hungry. One observer told me many on the streets supported the government, but they wanted them to do more, the situation is dire. A contact of mine who travelled to Sudan late last month reported seeing hundreds of cars queuing for miles at 2.00am. The queues were for petrol, but many are also queuing for hours for bread.
ARC: With the economy this bad, this delisting is clearly quite important?
Gill: Yes, the economy is on its knees, and it is exactly why it is so important to get on with the delisting in the hope that it opens up opportunities for foreign investment and potentially foreign aid. All of which have been closed until now. Because the sanctions have been American sanctions and they control the US dollar it has meant that a huge number of countries have not been able to trade with Sudan. Due to the very strict international banking regulations, even transferring money to the country is very difficult and a challenge for many in the Sudanese diaspora who wish to send money to their families.
ARC: What has the impact of Covid-19 been on the country?
It hasn’t devastated the country in the way people feared it would. Obviously, people have had Covid-19 infections and died but it hasn’t hit the country in the way it has many countries globally. When I was in Sudan in 1975, healthcare and education were not fantastic, but they were free. With the Structural Adjustment Programmes imposed by the International Monetary Fund in the 1980s, many found themselves unable to afford healthcare and over the last 30 years there has been no meaningful improvement in Sudan’s healthcare system. Therefore, it is a relief that clinically things have not been as bad as they might have been. You’ll see in the pictures of the protests and of the government in the media, nobody is wearing masks or taking Covid-19 particularly seriously.
What feels like a bigger threat to life currently is the floods. A million people are affected by floods in Sudan. Many people have drowned, their houses have collapsed. There is no insurance for most people in Sudan, meaning that lives have been totally decimated. It is a very serious situation.
Sudan has seen record levels of rainfall, which has caused flooding in the Nile River and its tributaries. This has been the worst flooding in at least a century.
On 4 September 2020, a three-month national state of emergency was declared [in Sudan] due to the floods, which have taken at least 99 lives and injured at least 46, with millions more affected. Climate change has been largely blamed for the rise in rainfall this year.
ARC: Sudan is now 14 months on from the revolution, how far has the country come in this time?
Gill: I would like to highlight something that I think is often overlooked in the international media’s reports on Sudan. That is just how unprecedented last year’s events were. The country’s younger generation was able to overthrow a deeply entrenched Islamist dictatorship using social media and raw courage. None of the armed movements, nor any party on the left or right, has ever been able to do that.
It was extraordinary that a bunch of students who came out and refused to go home over several months could topple [former president Omar al-Bashir’s (1989-2019)] regime. Foreign media still tend to ignore just how astonishing this peaceful revolution was. They also talk as though it was just a normal dictatorship, but it was actually a heavily entrenched one. The Islamist party infiltrated the whole system and used Leninist techniques to do so. It was a sophisticated regime entirely underestimated in the West and probably in Africa, too. All structures were built around the regime – everything was a state-owned enterprise controlled by security – from production to industry and marketing, it was to all intents and purposes a communist model but done in the name of Islam.
And of course, this is the problem now and something that will impact future investment and that businesses must be very prudent about. Just because al Bashir has gone, there are inevitably remnants of the regime. Organisations must know who they are dealing with, the due diligence will be a huge task for investors entering the countries now, even with removed sanctions. It is quite difficult to not go through the government, or at least the civilian administration. Due diligence processes must not only cover corruption, but ensure the company is not dealing with Islamists attempting to launder money through the organisation. This is a very serious concern and many organisations are still permeated with operatives who are sleeping for now – but pose a substantial integrity risk to business. This includes some of those at the heart of government and credited with moving Sudan forward. Mohamed Hamdan Dagalo, or “Hemedti” as he is known, is the head of the government economic committee and one of the most powerful men in the country. He was a commander of the Janjaweed, the government militias that massacred hundreds of thousands of people in Darfur.
The government has not been able to move enough people from the old regime out of parastatals and government departments because they don’t have people to replace them properly. The transitional government had to start from scratch. Although many people who have acquired skills abroad through study or work are heading back to Sudan now. And this will be an important part of rebuilding the country.
ARC: What happened to the private sector during al-Bashir’s regime?
Gill: A few big businesspeople did survive. Although they had to cooperate with the government, how much they cooperated is not clear, but they had to do so in some way. Many went into exile. Again, these survivalist businesses and the extent to which they cooperated with al-Bashir’s regime will need to be understood by foreign investors wishing to work with them now.
In terms of private sector activity, there has been gold mining by French and Russian companies as well as by Sudanese artisanal miners. Gold is widely viewed as having helped to keep al-Bashir’s government afloat financially for some years. Yet it has been marred by controversy as it has been mined without environmental concern, with the unregulated use of cyanide in gold mining, which raised concern among environmentalists and local communities. Large amounts of water are still required to produce gold – a commodity that Sudan does not have. If it is properly controlled, gold mining could be a source of interest now to investors. There of course could be many other minerals. A proper geological survey hasn’t been done for many years.
ARC: What of agriculture? I know it plays an important part in Sudan’s economy…
Gill: Yes, Sudan has been big on agriculture. Agriculture is mostly subsistence farming – some of it a bit modernised. But what mechanisation there was has often collapsed because the previous government didn’t seem to understand agriculture at all or have the slightest interest in it. It didn’t see it as a money spinner. They gave away land to a lot of potential allies, including many Syrians and other Arab interests – it is not clear how many were Islamists. Osama bin Laden was also handed several farms, which he used as camps to train fighters.
Yet, today agriculture could pose an exciting opportunity for the country.
ARC: What next for the country and what would be your advice to businesses looking to invest in Sudan?
Gill: Elections have been scheduled for 2022. The politics remains extremely complex and this is unlikely to change in the lead up to the elections. There are many actors jostling each other, which helps to create a fragile environment, as they need to cooperate rather than compete at this stage of the transition. The challenges the country faces, especially uprooting the ancien régime, mean everyone has to pull together to rebuild the country. It remains to be seen if we are going to see new parties in the next 12 months. The Sudanese communist party is angering many. This party is trying to undermine the government constantly, which is making a lot of people very upset and angry. And often people who would be naturally quite sympathetic to the communists are not sure why they are doing it. They run the risk of undermining the government to the extent that the Islamists seize power again – this is not an impossibility at the moment, making the country still a very fragile one and no doubt deterring a lot of investors.
That said, there are many economists in the transitional government and civil service, all aware of the need for investment, and they are keen for it not to be predatory. Hopefully things will change now and this recent announcement to remove Sudan from the US terrorist blacklist will undoubtedly set the ball rolling. I would have great faith in the Sudanese people, it would be a good place to invest. But investors must remain wary and extremely cautious of whom they are working with. They need to inform themselves well.
Get in touch now for further analysis on Sudan and other countries in the region: email@example.com