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Cameroon has registered timber, banana, cocoa, rubber and cotton as top five exported products in 2013, according to the National Port Authority (APN) statistics published on Friday.Cameron exported 1,746 million tons of timber; representing 66.2 percent of the country’s exports in 2013.
Banana accounted for 10.6 percent of export in the same year with 279,506 tons, representing the country’s second exported products.
Cocoa with 182,829 tons (6.9 percent of export), timber with 47 665 tons (5.8 percent of export) and cotton with 133 063 tons ( 5 percent of export) came third, fourth and fifth respectively among the top five exported products in 2013.
Total volume of exports at the port of Douala reached 2,639 million tons in 2013, up from 2,598 million tons in 2012.
Like exports, imports also increased slightly from 6,958 million tons in 2012 to 7,864 million tons in 2013, an increase of 906 tons, reprsenting 13 percent in relative value.
Africa has a particularly rich heritage. It is fondly remembered as the cradle of civilization because of the influence Egypt exerted over the rest of the world in ancient times. In more recent times, Africa has become an “economic mega block‐buster” offering some of the highest returns on Foreign Direct Investment in the world today.
A lot of studies, research and analysis have been conducted on the African continent and rightfully so. Investors continue to be wooed by the potentials embedded therein as more and more reports on Africa are reveal a steady upward trend in investment inflow. The continent, despite its well-publicized challenges, is being touted as the World’s top destination for investment flow.
Africa’s countries, however, do not offer the exact same potential returns for all categories of investment. A way of segmenting the countries would be to divide them into “high risk, high rewards” and “low risk, high rewards.” Both categories bear enormous potential, but differing levels of risks and economic stability.
Some characteristics of the Low Risk, High Rewards economy include Diversified economies, relative macroeconomic and political stability, relatively low incidents of insurgency.These countries are South Africa, Tunisia, Morocco, Kenya, and Ghana.
The risk of operating in these geographies is relatively low and the returns continue to be high. These are the most attractive spots on the continent, but the question of sustainability should be asked especially as other regions continue to develop economically.
High Risk economics hold traits such as they are mostly oil producers or have relatively non‐diversified economies, lower levels of macroeconomic and political stability than their counterparts in the low risk, high rewards category and higher levels of insurgency with the potential to cripple economic potential.
In this category you can find countries like Nigeria, Egypt, Angola, Uganda, and Tanzania.
These countries, surprisingly, do not attract significantly lesser investment than their more stable counterparts. In fact, over a four year period from 2007‐2011, these countries have received similar attention in terms of investment. For instance, Angola and Tunisia received similar investments over the four year window, the same hold for Morocco and Egypt.
Nigeria also is said to be the top gainer of foreign investment despite the heightened insecurity challenge it faces. This has been largely attributed to the country’s huge consumer space, with population exceeding 170 million people.
With more cooperation between African governments in promoting macroeconomic and political stability as well as curbing insurgency, we can expect to see more economic fortunes arise from the African continent.
The first hotel to be built in the city of Angoche, in Mozambique’s Nampula province may start operating this year, the head of Economic Activities Services for the district, Miguel Massunda Júnior told Mozambican daily newspaper, Notícias.
The hotel, construction of which is expected to cost US$664,000, is owned by Mozambican group Kirimba and will offer 42 beds along with other related services, such as a restaurant.
Massunda Júnior also told the newspaper that once the hotel opens to the public the city will finally have better quality accommodation and the number of beds available will increase from 67 to 109.
Angoche now has three bed and breakfast units – Parapato, Mafamede and Sporting – as well as some private homes that take in overnight guests.
With the exceptions of the provincial capital Nampula and the port town of Nacala, Angoche is one of the few municipalities that has the facilities to become one of the busiest urban areas in the province, particularly in economic terms, as it has electricity, running water, mobile and fixed-line telephone services and banks.
Most of the 172,000 inhabitants of Angoche work in the agricultural, fishing and informal retail sectors.
The Caribbean Climate Innovation Center (CCIC) — a project of the World Bank and its global entrepreneurship program infoDev — has announced the 11 winners of its first regional Proof of Concept (PoC) competition. The successful applicants will receive grants of up to USD 50,000 to develop, test, and commercialize innovative, locally relevant climate technology solutions.
Officially closed on April 20, the PoC has received more than 300 applications from 14 countries, including territories within the Caribbean Community (CARICOM) and the Organization of Eastern Caribbean States (OECS). Entrepreneurs were asked to submit proposals for innovative products, services, or business models in sustainable agribusiness, water management and recycling, solar energy, energy efficiency, and resource use sectors.
“This overwhelming response is very encouraging for the future of the CCIC and its activities,” said Everton Hanson, Chief Executive Officer of the Caribbean CIC. “The process was very competitive and even the unsuccessful applicants submitted interesting ideas that show great potential.”
The 11 winning proposals represent seven Caribbean countries — Jamaica, Trinidad & Tobago, Dominica, Antigua and Barbuda, Saint Kitts and Nevis, St. Lucia, and Belize. Particularly noteworthy is also the high engagement achieved among women, with four winning concepts submitted by female applicants.
The PoC grants are designed to help entrepreneurs prove the value of their business concept by providing the resources and the skills necessary to prototype, test, develop, and commercialize services and products. In addition to funding, the PoC winners will also get access to the suite of advisory services offered by the CCIC, as well as considerable exposure and networking opportunities through the center’s media events.
The CCIC will work with Caribbean countries to develop innovative solutions to local climate challenges. By supporting Caribbean entrepreneurs with a suite of services to commercialize new climate-friendly products, the CCIC will spur economic development, decrease reliance on imported fossil fuels and increase resilience to climate change.
The Caribbean CIC is part of infoDev’s Climate Technology Program (CTP), which is currently implementing a global network of innovation centers across seven other countries, including Kenya, Ghana, Vietnam and Ethiopia. The center is also part of the broader Entrepreneurship Program for Innovation in the Caribbean (EPIC) funded by the Government of Canada.
As part of efforts to enhance its operations, First Bank of Nigeria Limited (FirstBank) has concluded plans to raise fresh capital through the issuance of a new Tier-2 subordinated Eurobond. According to a reliable industry source, the bank will commence the road show for the bond on Thursday in London, preparatory to issuance of the dollar-denominated instrument.
UK Trade and Investment (UKTI) rail specialist Jake Rudham believes that there are many investment opportunities in the Namibian railway sector that firms from his country could exploit.Speaking at the conclusion of a one-day visit to Namibia, Rudham said UK companies had the necessary expertise to help the southern African country to develop its infrastructure projects, including railway.
He expected more UK companies to engage with TransNamib on projects such as the Trans Kalahari Railway.
“We look forward to further engagement and developing these opportunities,” the official said.
UKTI is the UK Government’s trade promotion body and the visit by Rudham followed the success of the fact-finding mission to Namibia by a British business delegation in September 2013.
During his stay Rudham met senior Namibian government officials, including Minister of Works and Transport Erkki Nghimtina, and representatives of the National Planning Commission, railways utility TransNamib and Namibia Port Authority.
Despite a slight deceleration in 2013 due to lower oil revenues, Angola’s economy appears to be back on track with real GDP growing by 4.4 percent, according to the World Bank’s latest Angola Economic Update.The expanded agricultural output and lower food import prices have also helped curb inflation rate to a single digit.
"Angola’s inflation is projected to remain on a downward trend as we expect global agriculture price indexes to decrease, and domestic agriculture production to continue its recovery from the 2012 drought", said Gregor Binkert, World Bank Country Director for Angola.
Elisa Gamberoni, World Bank Economist and lead author of the report said although the outlook for 2014 is favorable in light of an expected increase in oil production, absent of new discoveries, oil production is unlikely to further accelerate GDP growth.
"Non-oil GDP would thus need to expand rapidly to bring Angola back to the strong performance observed before the 2009 crisis", he added.
He explained that refocusing public expenditures on capital investment could positively affect Angola’s economic outlook, but only if execution capacity can be increased and the quality of public investment can be ensured.
On August 4th, the International diaspora Engagement Alliance (IdEA), Developing Markets Associates (DMA), Homestrings and Small Enterprise Assistance Fund (SEAF), will jointly host the Africa Diaspora Investment Symposium. The morning event of the symposium will highlight the tremendous potential of crowdfunding and other investment channels for the African diaspora to support economic growth.
Read more: https://www.homestrings.com/news-and-analysis/2014/july/02/crowdfunding-to-ramp-up-the-african-diasporas-contribution-to-development-at-us-africa-investment-symposium-in-washington-dc/#.U7ZJBvmSzK8
Judging by the dust on the label, the bottle hasn't been handled for years, yet it feels warm to touch. Perhaps that's because it's part of a wine collection that I'm told belongs to Russian President Vladimir Putin and my palms are perspiring.
Select frontier markets, once eyed skeptically as fraught with danger, are now some of the most robust economies in the world. But the shares of companies exploring and producing in these markets often continue to lag based on long-held fears that are no longer valid. How does an investor decipher that fine line between real and perceived? Carlos Andres, the chief analyst and managing editor of the Frontier Research Report and theGlobal Resource Investor, makes his living informing retail investors about risks in the junior resource space. In this exclusive interview with The Gold Report, Andres discusses how to capitalize on the narrowing gap between real and perceived risks in South America and beyond.
The Gold Report: Carlos, you note in the January edition of Frontier Research Report, entitled “2011 In Review: A World in Turmoil,” that only three countries with major stock exchanges finished 2011 in the black: Indonesia, the Philippines and Malaysia. Is the face of global risk changing?
Carlos Andres: In a word? Yes. Some emerging and frontier markets with significant natural resource endowments continue to emerge as robust places to invest and weather economic storms for savvy investors. Paradoxically, the world’s developed economies have become the more risky markets.
TGR: What factors are contributing to that?
CA: On the one hand, robust natural resource demand has asserted itself over the last decade, led by Asia in general and China in particular. Latin America deserves favorable mention as well. This is reflected in the rise in global commodity prices over the same period. It’s being fueled by factors such as population growth, industrialization, urbanization and infrastructure development driving income growth and middle-class expansion. As a result, when you are operating in these markets, there is a strong sense of economic activity, optimism and wealth creation. It’s tangible. You can see it and feel it.
On the other hand, as has been covered ad nauseam by media of all kinds, developed world markets are mired in myriad types of interlinking crises: financial, political, budgetary, debt, employment, military, etc. This fuels a high degree of uncertainty for investors in these markets. To a certain extent this is masking the economic growth on other markets.
TGR: Can you rank what you consider the top risks in the junior resource space?
CA: There are a lot of risks competing to be on that list! Consulting firm Ernst & Young recently released its annual metals and mining Top 10 report. At the top of the list, and I don’t disagree, is resource nationalism. There’s a resurgence of resource nationalism and it does seem to be taking on a rather virulent strain as of late.
“Some emerging and frontier markets with significant natural resource endowments continue to emerge as robust places to invest and weather economic storms for savvy investors.”
Second on the list is a significant shortage of skilled geoscientists. An all-time record of $18 billion was spent on non-ferrous metals exploration in 2011. As mining activities have picked up, so has the demand for skilled and experienced workers. There are not enough of them to go around.
Another rising risk factor, stemming from the success of the sector, is cost inflation. There is competition for the factors of production, including capital equipment. This is a significant factor underpinning the viability of mining projects.
Ernst & Young also lists capital project execution, or the ability to raise enough capital to execute projects successfully. That’s obviously a problem given current weakness in capital markets. Despite record production levels and profitability, investors have fled the sector. There’s a large disconnect that should spell opportunity for discerning investors
TGR: Does that particular risk speak to a lack of skilled management, too?
CA: Yes. Management has to shepherd capital very carefully and conservatively when cash is tight. It does come down to experienced management teams who are shrewd and very nimble on their feet. They must be creative about where and how to obtain financing as well as how they allocate it. Also, their accomplishments and reputations often have a lot to do with being able to bid away financing from management teams who are weak in this area.
Ernst & Young also talks about maintaining a social license to operate, which is a sophisticated way of saying it’s a good idea to get along with the locals near the mine. As we are learning, management teams ignore this issue at their peril.
TGR: The industry has done a poor job of that, by and large.
CA: It has. It’s becoming an increasing area of concern and focus for management teams as problems have flared in various locales. The shrewd companies are beefing up in that area to respond to social needs and concerns. It requires an added dimension of expertise. These issues have added to the costs for many companies. It has become a problem for both mines that have been operating for a very long time as well as new projects.
TGR: Investing in small-cap resource plays can be a high-risk game. What are some things that investors routinely do that expose them to more risk than is necessary?
CA: It’s obviously important for investors to pick the right management with the right projects in the right jurisdictions with financial firepower. The average retail investor often falls down on the job in this area despite the fact that there are lots of good news and research resources out there to help separate the wheat from the chaff.
“Robust natural resource demand has asserted itself over the last decade, led by Asia in general and China in particular.”
There are maybe 3,000 publicly traded junior resource stocks and a lot of them are not worth their listing. The first step is to eliminate the worthless, which means the list of 3,000 quickly becomes 300 or less that are worth considering.
However, many investors who are committed to this sector tend to engage in very poor trading strategies. This is not covered nearly as much as it should be. I’ll try to reduce it to some simple ideas: When trading, investors often feel as if they have to get in on this before it’s too late and, therefore, they will chase price as it moves up. Although it is certainly possible to make money this way in some cases, it is a bad habit that will work against you in the long run.
Investors also tend to allocate far too much capital to individual companies while at the same time not maintaining sufficient cash reserves. When price moves against them, their investment capital is fully deployed. Given the inherent volatility in junior resource stocks in particular, the prices of shares can move dramatically against them. These folks end up selling with large losses. They become demoralized and never return to these markets. Whereas if they had pursued a different trading strategy, they might find themselves not only being able to endure the storm, but able to generate wealth and become successful long-term investors in the sector.
TGR: What would you suggest?
CA: Something along these lines: Investors first find a company they like. It’s at a certain price. It’s a good price, but good strategy says you shouldn’t allocate all your money at once. Given that many investors will allocate far too much of their capital to one stock, once decided on an amount, an investor should probably reduce it. It’s a good risk-management practice in volatile markets.
If you decide to allocate $10,000 (K), maybe you just spend $1K at the current price and wait and watch. If the price falls significantly, say 20%, and you still think it’s a great company in a great jurisdiction, you spend another $2.5K. You are buying on the way down because you believe in the fundamentals, rather than chasing the price up because you are relying on the herd as proof for the value of the stock. You want to be selling to the herd and not buying from them. The only way to do this consistently over the long-term is to make a habit of buying value at distressed prices, like now.
Therefore, the lower the price goes, in 20% increments, for example, you would spend larger and larger chunks of your allocation of $10K. Thus you are lowering your basis as you go. When the price finally does turn around, you will have made a significant purchase right near the bottom. It allows investors to manage emotions and risk while accumulating value. If the company’s stock takes off just after the initial investment of $1K, you may have missed out on putting $9K in, but you still get to participate in the upside and you will sleep well at night.
There are, of course, more nuances to this type of approach to trading. These are the basics just to give some idea of how investors should be thinking.
TGR: Resource nationalization is a big part of jurisdiction risk. My sense is that there’s greater jurisdiction risk now than there was even five years ago. What’s your view?
CA: It was always there, but more countries are jumping on the bandwagon and asking for a bigger slice of the pie by raising taxes, royalties and the ownership interest a country takes in a mine. In some cases, such as in Africa, there is free-carried interest where the state is entitled to 10–20% of the mine without having to bear any of the development costs. It is creating uncertainty so the analyst has to wade through this.
“With any good fortune, the buying season for gold, and potentially for mining stocks as well, is ahead of us in the fall of this year.”
Some countries, like Indonesia, are adding a new twist. In order to capture a bigger piece of the pie, the government wants to require companies that extract natural resources to build refineries and smelters to refine products in-country before they are exported. Going from ridiculous to sublime, Indonesia is also requiring that after 10 years of owning a mine, a company must divest itself of 50% by selling to Indonesian concerns.
Where it starts to get really intense is outright nationalization. We’ve seen some of that in Argentina and Bolivia lately. There were rumors in mining-powerhouse South Africa as well, but cooler heads appear to have prevailed for now.
TGR: When companies are investing the kind of capital it takes to develop a large mine, they don’t want to lose half of it after just 10 years. That’s quite extreme.
Frontier Research Report has success identifying countries where there is more “perceived risk” than there is actual risk. What are some of those jurisdictions?
CA: We like to profit on the difference between perceived risk and actual risk because we’re able to buy things really cheap if perceived risk is higher than the reality. A company’s true value is revealed when it meets significant milestones and investors take notice. However, there are times, like the present, when the margins between perceived and actual risk narrows a bit.
TGR: Or a lot.
CA: Indeed. Now is one of those times where perceived risk is moving close to actual risk. It’s narrowed, even in some of my favorite jurisdictions, like Peru, which is a mining powerhouse and is No. 2 in the world in copper, No. 2 in silver and No. 6 in gold. Nevertheless, it’s experiencing some problems with local unrest to the point where it’s receiving international attention. It’s brought a cloud over Newmont Mining Corp.’s (NEM:NYSE) Minas Conga project, which has the green light from government but is moving very slowly in the face of local opposition.
TGR: It’s forced Peruvian President Ollanta Humala to change around his cabinet somewhat in order to try to appease both sides.
CA: That’s right.
TGR: Humala is a former soldier. He’s perceived as a leftist, but is he anti-mining?
CA: No, I don’t believe he is. Prior to the election, we argued to our subscribers that if he won the presidency, given the nature of politics in Peru and the importance of mining to the economy, he would find it very difficult to enforce his platform overnight and would have to moderate it. In the lead up to the election we started to see him do exactly that.
After he was elected, he proceeded to raise royalties and taxes. The mining companies went along with that. He said he would distribute funds and enact social programs in the rural regions of Peru. It seemed to work out fairly well at first. The local unrest that developed almost immediately after he was elected took many, including me, by surprise. There has always been local unrest but it flared unexpectedly.
TGR: These communities feel that they’ve been left out of the boom that the country has participated in over the last 10 to 15 years.
CA: I think they felt that if they acted out their social displeasure, maybe they would have the backing of their leftist president, but he perhaps caught them by surprise as he proved unable or unwilling to offer that support.
TGR: Ultimately, is Peru is a good place to be investing?
CA: Will mining companies be able to execute projects in Peru and successfully move them from start to finish? Can that still happen logistically, politically, from a regulatory standpoint in Peru? Absolutely. Will investors get comfortable funding projects in a country where there is local unrest? That’s the rub. Can companies raise financing in the capital markets in order to push projects through? That’s the question mark.
In environments like Peru, where mining will continue robustly even under a cloud, it will be more and more important that investors be able to differentiate well-managed, well-capitalized companies, with sound projects.
TGR: Your model portfolio took somewhat of a beating in 2011, along with most portfolios with a focus on this particular sector. Your gold holdings included Lion One Metals Ltd. (LIO:TSX.V; LOMLF:OTCQX; LY1:FSE), Gran Colombia Gold Corp. (GCM:TSX.V), Mariana Resources Ltd. (MRY:TSX; MARL:LSE), Minera IRL Ltd. (IRL:TSX; MIRL:LSE; MIRL:BVL), Rio Novo Gold Inc. (RN:TSX), Sulliden Gold Corp. (SUE:TSX; SDDDF:OTCQX; SUE:BVL)and Azumah Resources Ltd. (AZM:ASX). Auryx Gold was in there too, but it was taken over by B2Gold Corp. (BTO:TSX; BGLPF:OTCQX).
CA: All of these companies except one are still in the portfolio.
TGR: A couple of those companies in there have projects in Peru, including Sulliden, which is suffering from the cloud hanging over Peru after Bear Creek Mining Corp.’s (BCM:TSX.V) license to mine the Santa Ana silver deposit was pulled. Does Sulliden simply wait it out or can it lift its share price by continuing to derisk its Shahuindo project?
CA: Sulliden has experienced management with a strong track record, is well capitalized with $44 million (M) in the bank and is far enough along to shepherd the project through to completion. The question is will the Peru cloud eventually lift and will markets begin to improve so that Sulliden can achieve its true value for shareholders? I believe so. As Shahuindo moves toward development over the next 18 months, its share price is likely to improve substantially. The company will release a definitive feasibility study in August, which will likely add ounces to what is already an impressive 3.4 million ounce (Moz) deposit. Sulliden is also ramping up for mine development. This company has done well for our subscribers and will likely, in our view, add more value in the near future.
TGR: What are you expecting from the feasibility study due later in August?
CA: I’m relatively certain the results will be positive. It will contain a resource estimate update to the existing 3.4 Moz deposit, which includes 66 Moz silver. The deposit remains open in all directions, including at depth, so there is excellent exploration upside. The update will likely add ounces and upgrade existing ounces that are currently in the Indicated and Inferred category. The initial production profile of the open-pit mine will be scaled down from 150,000 ounces/year (150 Koz/year)to 100 Koz/year. That will reduce the initially planned development cost of $200M by half.
With a definitive feasibility study and a smaller, simpler mine plan, the approval process will be easier to navigate as well. The definitive feasibility study will feed the all-important environmental impact assessment, which will be submitted in the fall. It should take 9–12 months to obtain approvals and Sulliden has recently hired a seasoned specialist to manage the process for them.
The Sulliden story has all the hallmarks of a management team that is thinking soberly and strategically with the wherewithal to get across the finish line.
TGR: Minera IRL also has significant assets in Peru. It has a mine in production, Corihuarmi, with about another three years of production left. Minera is counting on future production from its Ollachea project. Can Minera IRL bring it into production within that timeframe?
CA: Chances are very good. Corihuarmi, which may be exhausted by mid-2015, is currently producing 30+ Koz/year. When Ollachea comes on-line, it will have production of 117 Koz. It will be an underground mine and the access tunnel is currently under construction and progressing on schedule.
The deposit itself currently contains 2.6 Moz Indicated and Inferred with solid grades between 2.8 and 4 grams per tonne (g/t) with a higher-grade core within the resource envelope of 5.3 g/t. Ollachea also remains open in all directions.
Minera is currently in the middle of preparing a definitive feasibility study that is due by the end of the year and the company is already working on mine financing options. Permitting and financing are scheduled for 2013 with mine development in 2014 and production scheduled for 2015. So, yes, I think the schedule is reasonable.
In addition, Minera IRL is a very well-managed company with the venerable Courtney Chamberlain at the helm and roughly $45M in the bank. Finally, exercising tremendous foresight, the company has an excellent relationship with the local community through numerous programs, including an agreement that provides for a 5% ownership interest, and a recently signed 30-year surface rights agreement, which enjoyed wide spread local support.
The company should be able to weather the storm and continue advancing its projects in Peru, as well as its Don Nicolas project in Argentina.
TGR: Some of Argentina’s oil and gas resources have been nationalized in recent months. Is Don Nicolas at risk?
CA: The country does not have a history of nationalization in the hard-rock mining industry, although it does in the oil and gas industry. The nationalization of the oil company, YPF SA (YPF:NYSE), has a lot to do with the fact that Argentina has gone from energy exporter to net energy importer in a massive way over the last few years. It used to provide all its own energy, but now it’s suddenly importing large quantities of natural gas to keep the lights on and it’s been draining the country’s foreign exchange. As a result, the government has been reacting rather radically. However Argentina didn’t try to nationalize the mining industry in the 2001 crisis and so far mining companies are soldiering on.
TGR: What about the move by President Cristina Fernández de Kirchner to restrict access to imported mining equipment?
CA: The government of Argentina is not necessarily targeting mining specifically. It is making policy decisions related to keeping foreign exchange in the country. It is impacting mining companies, but it hasn’t shut things down for them. Is there added risk? Yes, especially with imposing capital controls and rules on the way dividends are repatriated and capital equipment purchases are made. It is having an impact on mines. But it hasn’t shut down operations or exploration.
TGR: What are some other junior explorers that you believe have been unfairly punished by events beyond their control, or that are unusually undervalued due to perceived risk?
CA: Gran Colombia stands out in this regard. It sits in the junior ranks in the sense that it is continuing exploration on two very promising mining areas in Colombia. In reality, it has several legacy operating gold mines with large underlying deposits that are currently under development and hence is masquerading as a junior. The company’s Marmato deposit has over 12 Moz gold and 75 Moz silver and yet it’s valuation on an enterprise value per ounce level is around US$20 or 1.3% of the gold price. That’s unbelievably low.
Marmato is in the heart of a historic mining district in the center of Colombia dating back to the centuries when the Spanish controlled it. The company is developing an open-pit mine, scheduled to begin production in 2015.
In the meantime, Gran Colombia is deriving cash flow from the existing underground mine, which produces about 30 Koz/year. The company has another well-known historic holding formerly known as the Frontino gold mine but recently renamed Segovia. Three or four underground mines are currently producing over 100 Koz/year. Segovia has 1.4 Moz so far, but it’s going to get a lot bigger. So the company has cash flow from legacy operations, a world-class deposit at Marmato, lots of silver, a solid deposit at Segovia, with tremendous exploration upside.
TGR: The deposits tend to be high-grade underground vein deposits in Colombia, but they’re difficult to exploit en masse. There are these smaller high-grade operations, but nothing at scale. That’s what Gran Colombia is trying to do with the pit at Marmato. Do you think that it will prove successful?
CA: I do. Gran Colombia has a very experienced management team that has developed large gold deposits before. Although Marmato is operating a legacy underground mine, the massive deposit is being developed with a large open-pit bulk-mining design in mind. The drill results look good and I expect the company to be able to rationalize the pit dynamics and the grade.
TGR: These older operations that Gran Colombia is running have been grandfathered into the new mining act there. However, there have been very promising, much larger deposits that have not been green-lighted. What makes you think that this one will be?
CA: Because the management team has already accomplished what no other mining company would even attempt. Both Frontino (now Segovia) and Marmato had some significant legacy issues that had previously caused miners to shun them like the plague. Frontino had a $200M legacy pension problem from a bankruptcy in the ’70s. Marmato was previously fragmented into dozens of different ownership interests. In addition, the historic town of Marmato, which sat right in the middle of the deposit, had been partially destroyed by a landslide, creating a humanitarian dilemma.
All of these issues have been completely resolved by Gran Colombia management. The company was able to raise the $200M in capital markets to resolve the pension issue in exchange for a 100% unfettered interest in Frontino. It consolidated all of the individual land holdings at Marmato so that it now has 100% ownership of the entire site. Gran Colombia has also aided the government in rebuilding the city of Marmato further down the hillside, which has been completed. All of this was considered impossible.
Atypically, the management team hails from the region and is well connected. Executive Co-Chairmen Serafino Iacono and Miguel de la Campa are from Venezuela and were responsible for finding and defining one of the larger deposits in South America. Their success with Bolivar Gold and later Pacific Rubiales established a tremendous reputation for them both and so they are able to open doors that few others can. In addition, the President and Chief Executive Maria Consuela Araujo is the former Minister of Foreign Relations and former Minister of Culture in Colombia. That gives you some idea of the pedigree of management.
TGR: Lion One appears to be sitting on the tip of an iceberg with its high-grade low-tonnage Tuvatu gold project in Fiji. How is their story coming along?
CA: Lion One is making good progress. It has become evident that the company is sitting at the periphery of a large volcanic system at one edge of a large caldera. In geologic and physical terms, it is very similar to the nearby historic and still-operating Vatukoula mine, which also sits in a caldera. For reference, Vatukoula has historic production and remaining resources totaling 11 Moz. In this context, Tuvatu has an initial existing deposit of roughly 650 Koz established in the early 2000s.
Over the last eight months, Lion One has established that consistent mineralization is extensive laterally and at depth from the existing deposit. In short, this deposit is going to grow. Another is that the company has a deep pool of local geo and mining talent to draw on from Vatukoula, who have lengthy first-hand experience with the above- and below-ground geology.
Thus, on the exploration front Lion One is working hard to nail down the geological system underpinning the deposit. At the same time, it is pushing to establish a commercially viable mine plan scenario that could support the long-term exploration and development of what is shaping up to be an extensive gold field. This is a project to keep an eye on. The company is well-managed by an experienced team and it has about $15M in the bank
TGR: Do you have some tips on how to hone our approach in order to take advantage of opportunities while mitigating risks in the junior resource space?
CA: As we alluded to earlier, on one side of the ledger, it’s important to pick the right management, projects and jurisdictions. On the other side of the ledger, it is equally important to look at trading strategies and how much money to allocate to a particular company. The tried-and-true approach is not to invest more than you can afford to lose. I know everyone knows that, but I suspect a lot of retail investors lack the discipline to stick to it. Wait for the prices to come to you. Buy light in the beginning and buy in ever increasing amounts as the price declines. The rule is accumulation rather than chasing prices as they run away from you. The downside is far too high to chase prices like that.
TGR: Did we see the bottom for small-cap resource stocks in May?
CA: Indeed, they’ve come off the bottom a little bit—especially some of the more well known ones. I think they’re still probably meandering along the bottom as a whole, but some of the more prominent names will bounce off the bottom.
With any good fortune, the buying season for gold, and potentially for mining stocks as well, is ahead of us in the fall of this year.
TGR: Hopefully, Carlos. Thanks for speaking with us.
Learn more about the companies mentioned in a special report at www.globalresourceinvestor.com.
Carlos Andres is the managing editor and chief analyst of the Frontier Research Report, a natural resource-oriented monthly investment newsletter focused on high-risk, high-reward junior exploration companies in emerging and frontier markets. Andres identifies countries and companies where “perceived” risk is much higher than “actual” risk, providing opportunities to profit significantly. Andres has been a natural resource analyst and investor for over 15 years.
LONDON: Jumia, the Lagos-based internet retailer, is expanding its operations to target those West Africans working abroad who send money home to relatives.
Meeting in Paris, the international community promised to contribute USD 11 billion to support the economic recovery of Benin, exceeding the small West African nation's fundraising goals.
Held at the headquarters of the World Bank in Paris, the Roundtable was chaired by the President of Benin, Boni Yayi. It was attended by members of the Government, international organizations like the World Bank, the United Nations Development Programme (UNDP), the World International Fund (IMF), the African Development Bank (AfDB), the African West Bank Development (BOAD), the Benin international and private investors, as well as members of the diaspora.
Benin's Minister for Development, Marcel de Souza said that "the idea of organizing this roundtable comes from the Government's desire to lay the foundations of a prosperous and sustainable economy, aiming for rates of economic growth strong enough to reverse the curve of poverty and unemployment."
While economic growth rose to 5 percent in 2013, that level is still not sufficient to create enough jobs or to substantially reduce poverty, affecting about 35 percent of the population. Almost 60 percent of the youth in Benin are unemployed.
The Government aims to boost economic growth to 8 percent and reduce the poverty rate to 25 percent over the same period.
To revive the economy, the Government of Benin also plans to invest in priority sectors such as transport, energy, agriculture and tourism. The country has many advantages, including its proximity to Nigeria and the entire West African sub-region, in addition to its political stability, macroeconomic stability and low inflation.
In terms of achieving the Millennium Development Goals, Benin has made significant progress with the implementation of several initiatives such as free primary education for girls and free caesarean sections for mothers giving birth. The objectives relating to universal primary education, child health and access to clean water can be achieved by 2015 if current efforts are maintained.
Given the limitations of development aid, the contribution of the Beninese diaspora has become a central issue for development financing. Statistics show that remittances from the Beninese diaspora, the equivalent of 4 million people, represent 2.5 percent of Gross Domestic Product.
The Government said it wishes to involve the diaspora in the development and economy of Benin.
This initiative is strongly supported by UNDP, represented in Paris by Abdoulaye Mar Dieye, Regional Director for Africa and Odile Sorgho-Moulinier, UNDP Resident Representative in Benin.
"UNDP support in this process shows our deep conviction that we must fully integrate this powerful instrument, the diaspora, at the forefront of our development financing efforts," said Mr. Dieye.
The initiative will aim to create mechanisms to facilitate and better focus the diaspora's investments. The Government is considering measures for the benefit of Beninese expatriates, including the improvement of the delivery of administrative documents, tax benefits for investors operating in strategic sectors supported by the State, and ease of access to special economic zones .
JOHANNESBURG (Reuters) - South Africa's biggest private hospital group Mediclinic International raised $300 million by issuing new shares to fund acquisitions in Switzerland, it said on Thursday.
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Stockport Exploration, a Canadian firm prospecting for gold in Western Kenya, will begin mining operations at a cost of Sh74 million, part of the cash raised from local investors.
The firm that is mining in Migori raised $1.15 million (Sh100 million) through a private share placement in October 2013 that saw TransCentury chairman Zeph Mbugua appointed to its board.
Kestrel Capital was the transaction adviser in the deal.
Stockport said that extraction would now begin after it completed analysis, which was the first phase of its mining programme.
“Based on results from Phase 1, a Phase 2 programme will be undertaken to meet the remaining requirements for establishing a small-scale mining operation,” said Stockport in a statement.
The miner said that the second phase would see it begin to look for companies to offer services.
“Phase 2 of the programme will include finalising the agreement with a service provider to procure equipment and provide managerial services, process tailings and quartz rubble, and use a sophisticated small-scale mining operation at the SPL 214 target (its site) to fund ongoing exploration expenditures,” said the firm.
Stockport expects that it will begin to make revenues from its operations by the end of this year.
Stockport joins other mining firms that have raised capital for expanding operations and improving working capital in the western part of the country.UK firm Red Rock Resources raised Sh71 million through a bond to fund operations for its sites also in Migori County. African Queen Mines of Canada also seeks to raise Sh8 million for its operations in Homa Bay and Siaya.
Stockport also joins Base Resources, the Australian firm mining titanium in Kwale County, as miners that have sold shares to local investors.
In June last year, Base Resources announced that local, large institutional investors that included pension and asset managers had bought a one per cent stake in the miner for Sh170 million.
Analysts say that local businesses stand to benefit as more mining firms increase their operations.
“The construction of new mines across the region to exploit the rich set of natural resources in a historically underexplored region requires local engineering and construction capacity where TransCentury fits into,” said a report on the infrastructure firm by Old Mutual Securities.
The World Bank committed a record $15.3 billion to sub-Saharan Africa’s development in its most recent financial year, which ran from July 2013 to June 2014.
The bank delivered $10.6 billion in new lending for 160 projects during the year, including a record $10.2 billion in zero-interest credits and grants from the International Development Association, its fund for the poorest countries.
Sub-Saharan Africa has huge potential hydropower resources that could generate a tremendous supply of electricity, but only 10% of that potential has been harnessed, the bank said on Monday.
“Boosting access to affordable, reliable and sustainable energy is a primary objective of the bank’s work in Africa,” it said.
In Nigeria, the bank is working on a plan to increase its installed generation capacity by about 1,000 megawatts while mobilizing nearly $1.7 billion of private-sector financing.
The bank also supported the 80-megawatt Regional Rusumo Falls Hydroelectric Project in Burundi, Rwanda and Tanzania, and provided a $100 million grant to Burundi for the Jiji-Mulembwe hydropower project.
As one of the most attractive investment destinations in the world – second only to North America – Africa has been placed firmly in the spotlight for those seeking new ventures for their money.
The Washington-based World Bank Group this fiscal year has approved and disbursed a historic record high funding to Ethiopia, The Reporter has learnt. According to the information obtained, this fiscal year alone the World Bank has approved USD 1.6 billion and disbursed some 1.3 billion for eight projects in the country.
As government regulators crack down on the financing of terrorists and drug traffickers, many big banks are abandoning the business of transferring money from the United States to other countries, moves that are expected to reverse years of declines in the cost of immigrants sending money home to their families.
While Mexico may be most affected — nearly half of the $51.1 billion in remittances sent from the United States in 2012 ended up in that country — the banks’ broad retreat over the last year is affecting other countries in Latin America and parts of Africa as well. The banks are being held accountable not only for the customers who directly use their money transfer services but also for their role in collecting remittances from money transmitting companies and wiring them abroad.
“This is transforming the business and may increase the costs of international money transfers,” said Manuel Orozco, a senior fellow at the Inter-American Dialogue, a research group in Washington.
JPMorgan Chase and Bank of America have scrapped low-cost services that allowed Mexican immigrants to send money to their families across the border. The Spanish bank BBVA is reportedly exploring the sale of its unit that wires money to Mexico and across Latin America. And in perhaps the deepest retrenchment by a bank,Citigroup’s Banamex USA unit has now closed many of its branches in Texas, California and Arizona that catered to Mexicans living in the United States and stopped most remittances to Mexico as it faces a federal investigation related to money laundering controls.
Regulators say the banking system was being exploited by terrorists and drug lords seeking to launder money. While they have not banned banks from engaging in higher-risk businesses like money transfers to certain countries, they acknowledge that banks must now invest significantly more to monitor the money moving through their systems or face substantial penalties.
But the government’s efforts to root out illicit activity have effectively put the banks into a law enforcement role, industry experts say. And the result is undercutting another public policy goal — helping immigrants, who are primarily low income, move into mainstream banking. Even with the current relatively low remittance fees, the costs can still add up. Some Latin American immigrants say they regularly send three remittances a week to pay for last-minute school supplies or rent.
Manuel Santiago, a 48-year-old Mexican living in Queens, said he sometimes pays $4 to send as little as $20 at a time to his son and daughter in Mexico. “I am supporting my family and things come up irregularly,” he said.
The pendulum has swung so far, participants in the industry say, that regulators are pushing banks out of some activities considered beneficial to the broader economy.
“The money transfer business has become the whipping boy of regulators who want to show how tough they are,” said Paul S. Dwyer Jr., chief executive of Viamericas, a money transfer company based in Maryland with a large focus on Mexico.PhotoThe government’s efforts to root out illicit activity have effectively put the banks into a law enforcement role, industry experts say.Credit Drew Angerer for The New York Times
Shut out by many large banks, more of Mr. Dwyer’s customers are turning to large retailers in Mexico to pick up money sent from the United States, and some of those retailers charge money transfer companies as much as double the banks’ fees, he said. Mr. Dwyer’s company is recouping the additional costs by increasing the difference — or the spread — between what customers pay in dollars and what their family members receive in Mexican pesos.
A World Bank report on remittances found that the costs had been steadily falling over the last five years. But industry experts are expecting that trend to reverse.
A spokesman for Western Union, one of the largest remittance players, said the company was among those capturing business from the banks.
While immigrants say they have not noticed broad price increases from companies like Western Union, industry experts say higher costs are inevitable with fewer banks acting as middlemen for money transmitters.
“If you are the only game in town, you may be able to charge a premium,” said Daniel Ayala, head of global remittance services atWells Fargo, adding that the bank has not passed increased regulatory costs to customers, leading to a decline in profits.
Many banks had considered remittances an attractive business because they generated steady fees and required little capital. In some cases, remittances could satisfy Community Reinvestment Act requirements to serve a certain percentage of low-income customers.
But the regulatory pressures and increased costs of compliance have started to outweigh the potential profits.
JPMorgan stopped its Rapid Cash program in November, partly because the bank grew concerned about some of the risks, a spokeswoman said. As part of its program, JPMorgan had teamed up with the large Mexican bank Banorte. Many people picking up remittances in Mexico sent from Chase branches in the United States were not customers of Banorte, making it more difficult to monitor them.
Last year, Bank of America canceled its SafeSend product, regarded as one of the least expensive ways for immigrants to send money to Mexico. A spokeswoman said the bank canceled the product because of “limited demand” and would not elaborate. A BBVA spokesman declined to comment on the possible sale of its Bancomer Transfer Services unit.
Some banks still make certain wire transfers to Mexico, but the costs of such services can be five times as high as a typical remittance, making it prohibitive for many immigrants.
Even if banks invested in new software to screen for worrisome transactions, they would still have to manually investigate many suspicious activities and report them to regulators. Banks fear that a single mistake could lead to costly penalties like the $1.9 billion settlement that the British bank HSBC agreed to pay over money laundering issues in 2012. HSBC has stopped paying out remittances at its Mexican branches.
And the heightened diligence can slow, or even stop, vital payments.
Domingo Garcia, a 36-year-old limousine driver in Los Angeles, said he grew frustrated with Wells Fargo when one of his family’s remittances totaling roughly $1,500 failed to clear. In the same week, he said, family members had tried to send another large remittance. His mother needed the money to pay for her chemotherapy treatment in Mexico. “The hospital was saying it would not give her the medicine until they were paid,” Mr. Garcia said.
Wells Fargo declined to comment on a specific customer’s transaction, but said there could be a number of causes for delays, including efforts to screen for fraud and the bank’s limits on the amount of transfers allowed each month. While the bank remains committed to Mexico, it has slowed the expansion of its money transfer network to other high-risk countries.
Citigroup’s Banamex USA, which has been ensnared in a criminal investigation related to money laundering, is an example of how compliance problems at an obscure affiliate can have serious consequences for a global bank like Citigroup. The New York parent has removed many of the veteran managers at Banamex USA and installed a “cleanup team” of executives to improve its compliance systems, according to a person briefed on the matter.
Citigroup inherited the small California bank when it acquired Banamex, Mexico’s second-largest bank after BBVA Bancomer, in 2001. Because Banamex USA was overseen by executives at Banamex’s headquarters in Mexico, it did not come under the same compliance systems as Citigroup’s units in the United States, this person said. It also wired cash on behalf of money transfer companies in the United States to Banamex accounts in Mexico, people in the remittance industry say.
In reality, it may be nearly impossible to fully monitor money flowing through some parts of the world. Regulators worry, in particular, about remittances to Somalia, a haven for terrorist groups with no formal banking system. Banks in the United States have had to wire money to banks in Dubai. Much of the money is then moved into Somalia through a network of traders.
One of the few banks willing to take that risk is Merchants Bank of California. But in the face of scrutiny from regulators, the bank has told some money transfer companies in cities with large Somali enclaves like Minneapolis that it may no longer be able to provide them with banking services.
Merchants Bank’s exit could be a big blow to Somalia, where remittances are a major source of income for a country that has suffered from recent famine, according to the antipoverty group Oxfam.
“We’re looking for alternatives,” said Abdulaziz Sugule, president of the Olympic Financial Group, a money transfer company in Minneapolis that Merchants Bank may drop, “but it’s going to be tough.”
Foreign direct investment (FDI) into Africa increased by 4% to $57 billion over the past year, driven by infrastructure investments in addition to “international and regional market-seeking”, according to latest figures released by the United Nations.
The UN Conference on Trade and Development’s (UNCTAD) 'World Investment Report 2014' said the increase was driven by the Eastern and Southern African sub-regions.
Foreign direct investment flows into Southern Africa almost doubled in 2013 to $13bn, “mainly due to record-high flows to South Africa and Mozambique”, the report said. “In both countries, infrastructure was the main attraction, with investments in the gas sector in Mozambique also playing a role”.
In East Africa, FDI increased by 15% to $6.2bn as a result of rising flows to Ethiopia and Kenya. The report said: “Kenya is becoming a favoured business hub, not only for oil and gas exploration but also for manufacturing and transport.” In addition, “Ethiopia’s industrial strategy may attract Asian capital to develop its manufacturing base”.
FDI flows to North Africa fell by 7% to $15bn while Central and West Africa saw inflows fall to $8bn and $14bn respectively, which the report said was due in part to “political and security uncertainties”.
The report highlighted the growing trend of “intra-African investments”, which it said are being led by South African, Kenyan, and Nigerian transnational corporations. Between 2009 and 2013, the share of announced cross-border greenfield investment projects originating from within Africa increased to 18%, from less than 10% in the preceding period, the report said.
UNCTAD said: “For many smaller, often landlocked or non-oil-exporting countries in Africa, intra-regional FDI is a significant source of foreign capital.”
The increase in FDI inflows to the continent is in line with efforts by governments’ leaders towards deeper regional integration, UNCTAD said. However, “for most sub-regional groupings, intra-group FDI represents only a small share of intra-African flows”, UNCTAD said.
According to the report, only in two regional economic cooperation (REC) initiatives did group FDI make up a “significant part” of intra-African investments, “largely due to investments in neighbouring countries of the dominant outward investing economies in these RECs”. The two initiatives highlighted are the East African Community (about half) and the South African Development Community (more than 90%).
The report said: “South Africa and Kenya RECs have so far been less effective for the promotion of intra-regional investment than a wider African economic cooperation initiative could be.”
UNCTAD said intra-African projects were concentrated in manufacturing and services. Between 2009 and 2013, only 3% of the value of announced intra-regional greenfield projects was in the extractive industries, compared with 24% for extra-regional greenfield projects.
UNCTAD said: “Intra-regional investment could contribute to the build-up of regional value chains. However, so far, African global value chain participation is still mostly limited to downstream incorporation of raw materials in the exports of developed countries.”
UNCTAD’s findings correspond to a report published last May by consultancy Ernst & Young (EY) which indicated a growing trend in FDI projects in Africa.
EY’s report on market attractiveness in Africa (80-page / 2.4MB PDF) said Africa was “increasingly being taken more seriously as an investment and business destination, but in many sectors, a window of opportunity does still remain open for establishing an ‘early mover’ advantage”.
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The Sustainable Development Goals which are currently being formulated by the UN and other stakeholders, face gaps in both public and private investment in developing countries.An estimated annual $2.5 trillion funding is to be disbursed for this purpose said UNCTAD’s World Investment Report 2014 released in Nairobi, Kenya on Tuesday.
The report, which is subtitled Investing in the SDGs: An Action Plan, offers a bold framework to understand and enhance the role of private sector contributions to the pursuit of positive economic, social and environmental outcomes in developing countries.
Private sector contributions – through both good governance in business practices and investment in sustainable development – will be critical to the realization of the SDGs, the report says.
Public sector contributions will remain indispensable, but may be insufficient to meet demands across all SDG-related sectors.
Nevertheless, increasing private sector contributions poses challenges and policy dilemmas which must be addressed, says the report.
Among the key findings of the report states that estimates for total investment needs in developing countries alone range from $3.3 trillion to $4.5 trillion per year, for basic infrastructure such as
Canadian trade finance agency Export Development Canada will open its first African office in Johannesburg in 2015, Canada's minister of international trade, Ed Fast, announced on Monday.
Fast, who is on a 10-day tour of Burkina Faso, Madagascar, South Africa and Tanzania, was addressing a media briefing in Johannesburg when he made the announcement.
Fast said Canada had chosen Johannesburg as the location for its first Export Development Canada (ECD) office because of the city's economic position as the financial gateway to southern Africa.
He said the ECD, through its Johannesburg-based team, would focus on connecting more Canadian businesses, particularly small and medium-sized enterprises (SMEs), to the growing supply chains within intra-African trade.
"South Africa is Canada's most important commercial and political partner in Africa and is the only country in Africa - and one of only 20 around the world - to be identified by our government's recent Global Markets Action Plan as an 'emerging market with broad Canadian interests'," Fast said.
"When most Canadian businesses look to South Africa, they see a country so far away they think it's impossible to trade with it. The EDC will change that," Fast said, adding that on-the-ground support in southern Africa would help Canadian SMEs to boost their exports and create jobs and opportunities at home.
Fast also said the South Africa-Canada Chamber of Commerce would be revitalised to provide a forum for Canadian companies and investors in the country.
President Jacob Zuma, during the state visit of Canadian Governor-General David Johnston in May last year, said South Africa offered good investment prospects for Canadian companies, adding that they should take advantage of infrastructure projects on the continent, as well as get more involved in Africa's mining sector.
Johnston said the success of the Canadian-designed Gautrain demonstrated both the quality of South African infrastructure and the strength and expertise of Canadian technology.
There were several areas in which South Africa and Canada could co-operate, including mining, infrastructure, agriculture and education, he said, adding that the success of Africa was critical to the success of the world.
"This remarkable experiment of bringing diversity together and reinforcing democracy that we have seen in South Africa from last 19 years is inspiring all of us ... and we will be with you all the way as you bring the African continent together to extend those values and achievements that you have already demonstrated so well here," he said.
VENTURES AFRICA – According to the ex- Central Bank of Nigeria (CBN) Deputy Governor Mr. Tunde Lemo, the value of mobile money payment as at May 2014 has amounted to $1.7 billion (N271 billion) for 25 million transactions, confirming a growing adoption rate of alternative payment services in the country.
This shows an increase in mobile money transaction when compared with the figure posted in August 2013, which amounted to N10.1 billion ($61.9 million) for 1.6 million transactions. Mr. Lemo made this known while speaking at an event organized by Nigeria Deposit Insurance Corporation (NDIC), the agency responsible for maintaining Nigeria’s financial system stability.
The apex bank of Nigeria, issued a regulatory frame work for the operation of mobile payment services in the country in 2009, to reduce the Number of unbanked Nigerians. As at 2013 the apex bank granted licenses to 15 non-banking operators and 6 banks.
The Cash-Lite policy of the CBN was introduce in a bid to modernize Nigeria’s payment system; reduce the cost of banking services, drive financial inclusion, improve effectiveness of monetary policy, reduce the high security and safety risks, reduce high subsidy, foster transparency and curb corruption and ultimately meet the federal government’s Vision 2020.
The main Factor responsible for lack of traction of mobile money operations is inadequate capital investment on the part of mobile money operators.
“There is need for higher investment on agent network’s marketing than initially forecasted. N500 Million was the initial official requirement for mobile money operators but it has been revealed that 500million was inadequate”. This statement was made by Mr. Dipo Fatokun, Director, Banking and Payment System Department of the CBN.
Operators of Mobile money are complaining of lack of basic infrastructure such as power, telecommunication networks and others. There is also the difficulty in reaching the unbanked especially in remote areas as agents are not available.
According to MEF a global community for mobile content and commerce,15 per cent of mobile media users used mobile payments to pay for goods globally in 2013.
Africa continues to dominate mobile banking uptake with an average of 82 per cent of consumers engaged in this activity last year.
Although Turkey went to Somalia to provide humanitarian aid in 2011, Mogadishu has been offering more political power. If accurate steps are taken, a stronger Turkey in a stronger Somalia may be visible.
MOGADISHU – The 16th century was the first time Turks entered Somali territory when local governors asked Sultan Süleyman the Magnificent to rescue Mogadishu from the Portuguese navy, which was looting the city. Although the Ottomans lost to the Portuguese navy, they left behind mosques and a castle. After three centuries, the Ottomans were in Somalia again to help the local people who were resisting a British invasion and suffering from a humanitarian crisis. The Ottomans established an embassy, dug water wells and trained people to create an army.