The essence of privatisation in Africa is the acknowledgement by governments that it is not their business or responsibility to run enterprises.
According to my observations on the privatisation issue in Africa, state-controlled businesses tend to be insufficient entities run with insufficient commercial acumen. Historically, to offset losses, governments in Africa subsidised these enterprises with taxpayer’s money which should be spent on improving social services delivery.
In this vein, I tend to agree with the arguments of two prominent privatisation experts namely, the Economist’s American business Editor, Matthew Bishop and John Kay who is one of Britain’s leading economists. The two experts said there are essentially three factors that can justify privatisation. The factors are finance, information and control. The privatisation experts said the financing of both government and the firm is affected by privatisation. Their explanation is that the government raises finance from capital markets, and information is of relevance in setting prices. The experts said competition ensures that prices are consistent with efficient allocation of resources and lowest costs of supply. They argued that even in the absence of competition it has been suggested that privatisation may allow prices to be imposed that encourage greater efficiency of supply.
Some studies carried out in the United Kingdom also established that in the majority cases, the demand of shares exceed their supply immediately upon privatisation. However in his book, Privatisation in theory and Practice” Madsen Pirie said Africa has seen slower progress toward privatisation than anywhere else. He said part of Africa’s economic plight was its wholesale adoption of public sector economics after independence, much of it taught in good faith by its former colonial rulers. In 1985, a reversal of policy was declared by the Organisation of African Unity, which is now the Africa Union, when it stated that the positive role of the private sector is to be encouraged. As a result of this reversal of policy, I have noticed in recent years that the privatisation pace in Africa is on the increase.
Many African countries now recognise that they need privatisation to help them to develop capital markets, but they are hindered in their efforts to privatise by the very lack of those markets. Commenting on privatisation in Africa, the former president of the African Development Bank, Babacar Ndiaye noted that privatisation is vital for the resuscitation of the region’s depressed industries. He noted that privatisation efforts are under way in many African countries like Ghana, South Africa, Sudan, Tanzania, Uganda, the Gambia, Mali, Zaire, Malawi and many others.
As the privatisation drive continues to gain momentum in Africa, I have observed that the path to privatisation in many African countries has been strewn with political, legal and technical difficulties that have delayed proposals for years on end. Against this backdrop of my observations and that of other economists, many former state owned companies or enterprises in Africa prefer partial privatisation when compared to full-scale privatisation, since they do not have complete faith in the privatisation exercise.
The privatisation of utilities and infrastructure is also presenting a number of particular difficulties which are as follows: The demand of absolute political commitment, the social nature of service and infrastructure provision, the monopoly nature of service and infrastructure and the size of business and the investment requirements.
The added problems faced by African countries in their efforts to privatise is the issue of heavily degraded infrastructure, over-specified systems, underdeveloped capital markets, small markets and lack of regulatory capacity. As a result of these monumental problems, the issue of privatisation as a major force of economic change has proven to be a very challenging issue. However many privatisation experts are of the opinion that the many African countries that have started the process of privatisation will soon feel the real economic impact of this through tangible results such as improved efficiency and profitability.
Privatisation has proven to have an impact on alleviating poverty in terms of the fiscal, pricing and employment implications. A closer analysis of privatisation in Africa especially in Sub-Saharan Africa, shows that where governance issues, regulation and transparency are given prominence, privatisation can and has delivered much of its promises.
West Africa has a long history of privatization. In the first half of the 1980s more than 227 firms were privatized in the whole of Africa. Three-quarters of these were located in just six countries, five of which were in West Africa (Côte d’Ivoire, the Gambia, Guinea, Niger and Togo). By the late 1980s, 12 of the 18 Francophone countries had public-enterprise programmes in place. Between 1988 and 1993 the Nigerian government disposed of 55 small-scale state-owned enterprises (SOEs). In Ghana 159 SOEs were sold or liquidated between 1991 and 1995. However these official data underestimate the true number of privatizations, since countries like Mali with a sizable privatization programme are not included in the databases, while in other countries, such as Benin, only a small percentage of the real number of privatizations were reported. In total, it is estimated that 847 privatizations were effected in West Africa between 1980 and 1995.
The downside of privatisation is the issue of job losses, either through forced or voluntary redundancies. As a result of retrenchments, the privatisation drive in Africa is also on a collision course with many trade union movements on the continent.
By: Selbin Kabote
It was never going to be easy. Egypt is rapidly coming up to its second anniversary of the January 25 Revolution, and two years on the country is still grappling with the complex fallout of deposed president Mubarak’s ouster. The sheer scale and scope of the political and economic reforms needed would be challenging for any country, and as the debate over the constitutional referendum is proving, Egypt is no exception.
Some of the issues that president Morsi’s administration is now grappling with are short term and cyclical in nature — higher operating costs for retailers, for example, or depressed tourist numbers — but some are far more fundamental in nature, and far more concerning.
Perhaps among the most alarming — and one of the primary triggers for the revolution in the first place — is that of unemployment.With sluggish economic growth hovering around 2.6%, the 85 million person country is struggling to keep up pace with the increasing number of entrants to the job market every year.Thanks to depressed economic activity, in 2011 Tunisia and Egypt registered the largest increase in unemployment in the Middle East and North Africa region, rising 7% and 3.5% respectively.As of the third quarter of 2012, the official unemployment rate in Egypt stood at 12.5% or 3.3 million Egyptians according to the Central Agency for Public Mobilization and Statistics (CAPMAS), the state-run statistics agency.
This number of course fails to take into account figures for underemployment, but even so a close examination of make-up of those 3.3 million citizens reveals a worrying chunk of qualified young Egyptians who have been left without jobs.Young people between the ages of 15 and 29 are estimated to account for nearly 70% of total unemployment. According to CAPMAS, 90% of the 3.3 million unemployed people are educated to a secondary school level, while the IMF estimates that unemployment exceeds 15% for those with a university degree.
As in so many countries, two decades ago a university degree guaranteed employment, but as many recent graduates are finding out, this is no longer the case today. With over 2.5 million Egyptians attending the country’s universities and some 750,000 people entering the labor market every year, including 200,000 new graduates, swift actions will need to be taken to address the system’s deficiencies and face a rapidly expanding labor force.
What makes matters worse is the stubborn mismatch between the skills graduates are equipped with and the requirements of the job market. Although the country has made significant strides in education — with improved performance on indicators such as literacy rates which increased to 86.2% in 2007 from 73.2% in 1996 for those aged between 15 and 44 — employment rates for new graduates have not grown at the same pace.
Part of this is the result of a slow hollowing out of the middle-skilled ranks of workers. A 2013 study by the Egyptian Center for Economic Studies found that the country was not only grappling with a growing wage disparity, but also a decline in demand for middle-skilled employees relative to high- and low-skilled workers. As a result, the bulk of Egypt’s educated graduates, who make up large swathes of the middle class, are losing out to a small and highly skilled workforce at the top of the ladder and a larger proportion of low-skilled and manual laborers.
To try and not only increase employment opportunities for new graduates but also improve their employability, Egypt has sought to expand not only labor-intensive activities, such as manufacturing through the Industrial Modernization Center’s Industrial Development Strategy, while at the same time increased targeted skill training.
Vocational training is a sector that has been poorly cultivated, due in part to the unsurprising emphasis on university expansion over recent decades. Reforming vocational education is therefore key to address these problems and attract more students in the future.
As a result, programs such as the Technical and Vocational Education and Training System Reform Programme (TVET), launched in 2005 in collaboration with the European Union, are crucial. The project aims to boost the supply of skilled labour in job-intensive sectors such as manufacturing, construction, services, and tourism, which combined account for 80% of the country’s jobs.
The TVET, which will run until 2013, has so far trained some 50,000 job seekers and established more than 500 in-house training facilities in the garment, construction, agroindustrial and tourism industries, often in partnerships with private employers and sectoral associations.
Just as crucial, however, have been the efforts of employers more broadly. A shrinking pool of eligible labor presents an equally pressing concern for the private sector as for the government, which has prompted a number of companies to launch programs that increase practical and technical education. CedarBridge, a regional private equity fund, signed a seven-year agreement to invest €100 million (LE 813.5 million) in a network of courses and programs that would allow young Egyptians to receive training and certification from education companies including Pearson, Festo, TUV Nord, and Plato. The program’s first graduates are expected in May 2013 and CedarBridge estimates a total of one million young Egyptians will benefit from this initiative.
There are smaller-level initiatives as well. Last year, Euroconsult Mott MacDonald, an engineering consultancy, launched a four-year and nearly €2 million (LE 16.28 million) project to establish three schools and three training centers in conjunction with the Holding Company of Water and Waste Water in Egypt. The project aims at increasing the number of technicians in the water supply and sanitation sector and improving management at training facilities. Initial forecasts suggest the program could train up to 40,000 technicians.
Of course, training represents only one aspect of the hiring equation. Even with improved skill sets for technical works and middle-skilled employees, without sufficiently robust growth in key industries, job creation rates will remain static. The muted performance of the economy has put a strain on the hiring capacity of businesses, most particularly in the case of small and medium enterprises (SMEs) — Egypt’s main source of employment, accounting for between 70% and 80% of all jobs. As a result, efforts are underway not only to increase the overall sustainability of SMEs but also to encourage greater entrepreneurship among new graduates.
Certainly, there are no shortage of programs currently underway. The Egyptian Social Fund for Development (SFD) is one example.Dedicated to supporting small and microenterprises, last summer the SFD signed an agreement with Al Baraka Bank Egypt to extend SME financing to an additional 4,400 projects. A similar effort by the General Authority for Investment has seen the launch of Bedaya Centre Investment Fund for SME Development, with has a target of LE 1 billion and aims to help provide investment capital and general operating expertise for SMEs with a capital of between LE 2 million and LE 50 million.
There are also initiatives such as Egypt’s annual Young Entrepreneurship Competition, the sixth iteration of which took place most recently at the end of November. The competition aims at bridging the gap between the education system and the hiring capacity of the private sector by drawing in teams of more than 200 graduates from seven different universities to compete for seed funding for their business ideas.
Egypt has a lot of pressing concerns that need tackling, whether it be a new constitution, subsidy reform or expanded electricity generation. At this stage, employment is only one of many issues demanding attention but if the country is to ensure sustainable growth and consolidate the progress made since the January 25 Revolution, it is one of the most important. Economic opportunity — and the lack thereof — was a key factor in prompting the unrest that led to the Arab Spring, and ensuring that the youth of today have the ability to access secure employment is crucial. Like so many of the reforms Egypt needs, it will not be easy to guarantee, but doing so will go a long way in helping the country realize its potential.
Robert Tashima is the Africa regional editor with the Oxford Business Group, a leading provider of economic and political intelligence about the Middle East, Africa, Eastern Europe, Asia and the Caribbean.
Source: Business Today Egypt
The Government of Ethiopia Wednesday convened a meeting of African Ministers of Health and global experts aimed at accelerating reductions in preventable child deaths through sharper national plans and improved monitoring and evaluation.
The African Leadership for Child Survival – A Promise Renewed conference, follows last year’s Child Survival Call to Action, which was co-convened by the Governments of Ethiopia, India and the United States with UNICEF and launched a global roadmap to end preventable deaths of children under five.
The Call to Action challenged countries to lower their national rates of child mortality to 20 or fewer deaths per 1,000 live births by 2035. Under the banner of Committing to Child Survival: A Promise Renewed over 165 countries have since pledged to scale up efforts to end preventable child deaths.
The African continent shares a significant global burden of newborn, child and maternal deaths. Of the 3.5 million such deaths per year in Africa, more than 1 million are newborns. But some African countries such as Libya, Mauritius and Tunisia have already reduced their under-5 mortality rates to below 20 per 1,000 live births.
Setting the stage for the meeting, Ethiopia's Minister of Health Kesetebirhan Admasu said: "We are at a crucial juncture in our final sprint towards the 2015 Millennium Development Goals and the 2035 vision of ending preventable child deaths. Much will depend on country-level leadership and action on child survival. I strongly believe we can only accelerate our progress if we renew our commitments and live up to providing increased, sustained and more harmonized leadership and support."
USAID Administrator Rajiv Shah provided a clear message to participants: "Your leadership and dedicated focus is an essential part of this unified effort. It is wonderful to see so many countries gathered together to focus on how to sharpen national plans and develop scorecards to strengthen monitoring and evaluation. The work you are doing will continue when you return to your capital cities—and USAID stands ready to support you."
UNICEF Executive Director Anthony Lake said in another message: "In the past two decades, we’ve seen huge reductions in under-five mortality. But we must do better. In Sub-Saharan Africa alone, over 9,000 children under five die daily, mainly from causes we can prevent. If we can prevent children dying, we must. And with all of your skills and political leadership, we will."
Leaders will seek to give the global movement, Committing to Child Survival: A Promise Renewed, greater momentum and hope in Africa. Together with non-governmental organizations, the private sector and faith groups, countries are united around a simple premise: that every child everywhere deserves to reach their full potential.
The three-day meeting in Addis Ababa is ahead of the African Union summit 21 to 28 January.
By Martin Tsegaye
Source: Africa Science News
It has been years since northern Uganda's children had to troop to town centres at night for safety from abduction by the rebel Lord's Resistance Army (LRA), and most have moved on from the crowded displacement camps where they were born. But while they can sleep at night and look forward to a peaceful future, their lives are rarely easy.
Over the course of the 20-year-war between the government and the LRA, an estimated 30,000 children were abducted from their homes to serve as fighters, porters and sex slaves and baby-sitters.
"It was a terrible period I will never forget. It was a life of total fear, knowing that anytime you could go [get killed or abducted]," 20-year-old Welsy Ajok told IRIN. "That period [2002-2004], I and couple of other children slept in the streets of [Gulu] town on the bare floor at the shop veranda... Sometimes we heard the gunshots of the rebels raiding the vicinity of the town in the night."
Today, Ajok lives 24km south of Gulu Town, in the village of Patek. She rides a bike to school every morning, after bringing her two children - ages two and five - to an early childhood development centre.
"It's a relief, because our children have a different way of life that looks brighter. They are learning how to do things in school and at home," Patrick Ojwang, another Patek resident, said. "Forget about the LRA days. The children are happy, living a life of no violence - all we have to do as parents is provide a conducive environment for the children to learn and develop."
Yet poverty, harmful cultural practices and inadequate child protection mechanisms - both legal and community-based - continue to exact a toll on children’s welfare.
Many parents struggle to afford their children's education. While primary and secondary school education is free in Uganda, related costs like transportation, uniforms, books and school supplies pose significant financial challenges to poorer families.
In Purongo Village, situated along the Gulu-Arua Road, weary children return from labouring on local commercial farms. "That's what I and other children here do during holidays to raise money," said Langol Olango, a 14-year-old pupil at Purongo Hill Primary School. "On a good day, when I harvest a big area of the rice, they pay me 15,000 shillings [about US$5.50], but it's a very tedious kind of work."
Olango spends part of his earnings on his family's basic needs and the rest on school supplies.
Government officials in the north say the region's continued poverty is causing problems for children's education. "Though enrolment is high, the dropout rate is equally high year in, year out. The worst affected are girls," said Charles Irwenyo, the district education officer in Nwoya.
In April 2012, Uganda's Daily Monitor reported that the school dropout rate for girls in Gulu District was 40 percent. Teenage pregnancy is a major reason girls leave school. Other challenges include: long distances between homes and schools; pupil-to-teacher ratios as poor as 60 to one; and lack of an adequate diet.
A visit to health centres in the region revealed a high number of children seeking treatment. Medical workers say some of the common child illnesses are malaria, malnutrition, respiratory tract infections and diarrhoea.
Vincent Ouma, the district’s community service officer for children’s affairs in Gulu, told IRIN that child protection is also a major issue. "It's challenging for district/local government to provide direct support towards such challenges. We rely on the support of nongovernment organizations intervening in areas of child protection," he said.
A 2012 report on child protection in the northern Ugandan districts of Lira and Dokolo, by the NGO Child Protection in Crisis, found that major sources of harm include: sexual abuse, child labour, verbal abuse, unfriendly home environments, poverty, as well as harmful cultural practices like early marriage.
The Canada, Holland and UK branches of the NGO War Child are engaged in child protection programmes to keep children from being exploited.
"Our work focuses on prevention and response to issues of child protection... providing legal, advocacy... and promoting child protection in partnership with agencies like the police, district community development officers, probation officers, civil society organizations and community structures like child protection committees to address these challenges," said Beatrice Ocaya, a regional coordinator of child protection activities at War Child Holland in Gulu.
According to Johnson Kilama, the commissioner of police in northern Uganda, much more is needed to address child protection in the region.
"A lot of efforts are being undertaken, but it will take some time for people to understand that there is need to protect children wherever they are. It’s a collective responsibility," he said.
Freetown — The air is heavy with the smell of marijuana as Gibrilla (23) expertly rolls a large joint at the Members of Blood (M.O.B) gang base in a poor neighbourhood of Sierra Leone's capital, Freetown.
He is part of a generation of young people faced with a chronic shortage of jobs, many of whom have turned to routine drug use as a way to pass the time and deal with the stresses of life in what is still one of the poorest countries in the world.
"Most of the young guys smoke diamba (marijuana) here," says Gibrilla, gesturing towards the slum neighbourhood of Susan's Bay. He says he has been smoking since he was 11, and usually smokes about 15 joints every day. "I have my first one at about five o'clock in the morning when I wake up," he told IPS. "It makes me feel good."
Sierra Leone's high unemployment rate is fuelling a culture of drug use among the country's urban youth. Experts say the trend is responsible for acts of violent crime, while medical practitioners are concerned about serious health repercussions for long-term users, which the country is poorly equipped to address.
In another part of the city, Patrick, who estimates his age as "twenty-something", swigs from a plastic sachet of gin as he talks of his relationship with drugs.
"I use cocaine, marijuana, brown-brown (heroin) and liquor," he told IPS. "I did not choose to live like this. I was living the street life
... sometimes I did not even have somewhere to sleep. I had nothing."
Patrick now feels he needs drugs and alcohol just to get through the day. "I feel hopeless when I don't have them," he explains.
His friend Alimu, heavily tattooed, with the initials of his gang shaved into his hair, speaks of a similar dependence. "I don't want to stop," he says. "I need it now."
Alimu is not sure how much he takes every day, only that he spends all the money he can get on drugs and alcohol.
Assistant Superintendent of the Sierra Leone Police Force, Ibrahim Samura, says he is alarmed by the "spate of drug abuse and addiction".
"It is worse than before ... amphetamines, cannabis and heroin are all a problem," he says, adding that cannabis is the most widely available. "Cannabis is now grown in almost every district. In some places in the north it is even used as a currency for barter."
Samura says that there was a large increase in drug use and addiction during and after the country's eleven-year civil war. "People used drugs to deal with the stress of war," he explains.
Dr. Edward Nahim has been working on drug and mental health issues in Sierra Leone for over 40 years. He agrees that the problem is, to some extent, linked to the civil war. "The conflict itself might be a contributing factor, because once you've learnt bad habits it becomes difficult (to stop)."
But he also says that drug addiction in Sierra Leone is tied to a lack of job opportunities. "It is more common amongst the unemployed vagrants, because they don't have any work to do. (They) are the ones who spend most of their time in the ... drug abuse bases or ghettos," he says.
Impoverished and traumatised youth even use drugs just to "kill boredom", Samura says.
Youth unemployment in Sierra Leone stands at a staggering 70 percent, according to the World Bank, and many drug users in Freetown say that if the government provides jobs for them, they will no longer feel the need to use drugs and alcohol.
"If I have a job I will stop smoking," says Gibrilla. "But when I don't go to work in the morning I just sit down and smoke diamba."
Ibrahim Jones, a Susan's Bay resident sporting a 'Fight Against Drugs' wristband, also thinks reducing unemployment is crucial to addressing drug use. "People smoke because there are no jobs," he confirmed.
Samura says he is concerned about the relationship between illegal drugs and violent crime. He sees drug use as closely related to an increase in "gangsterism" in Sierra Leone.
"There are over 250 criminal gangs in this country," he told IPS, displaying a list with names such as 'Gang Killers', 'Blood Drain', 'Hisbola' and 'Da Elusive Thugs'.
He believes drug use "spurs them to behave abnormally and do things they wouldn't do in their right senses." On drugs, these young people "have the guts to kill, they'll be brave (enough) to stab."
The combination of high-grade cannabis and other drugs, together with cheap but potent local liquor, is also having severe mental health repercussions for long-term users.
"Drug abuse is a big problem in psychiatry in Sierra Leone today," says Nahim, who runs a small mental health clinic in Freetown. He says around 80 percent of his patients, all of whom are between the ages of 10 and 35 years, are suffering from drug-induced psychotic disorders.
"By the time they get to about 40 years they are dead from the physical and psychological complications of these drugs," he admits.
He adds that the problem is worst with young men, "but the girls are catching up now".
Sierra Leone lacks the means to effectively treat such victims of drug and alcohol-induced psychosis. Nahim uses what he calls the "cold-turkey method" to treat addicts, physically restraining them and administering "very strong tranquilising drugs" for sedation. "Then after ten days it's over," he says.
But relapse rates are high. After treatment there are few safeguards to prevent patients slipping back into drug use.
City of Rest Rehabilitation Centre is one of only a handful of establishments catering to drug users and the mentally ill on a longer-term basis. More than half of its 40 inpatients are suffering from drug-related problems.
It is run by Pastor Morie Ngobeh, who uses religion and counselling to treat individuals with drug-induced mental conditions. "We rely on prayer, for God to renew their minds," he says.
Abdulai Bah's family admitted him to City of Rest to deal with his chronic alcoholism. It is the second time he has been a patient there, but he feels that with a job waiting for him he will be able to stay off alcohol when he leaves in January.
"Some of my relatives promised to help me start my own business. If I start to get myself engaged, I will not drink alcohol again," he says with conviction.
By Tommy Trenchard
Abidjan — Who is young and who is not? At what age does youth come to an end? In Ivory Coast, the concept of youth has become more than a matter of birthday. Instead, it's being marked by various socio-professional traits - some of them defined by prejudices fuelled by the media and politicians.
Ivory Coast's ministry of youth considers anyone between ages 15 and 35 to be a "youth". But on Ivorian radio and TV, one often hears phrases like: "a young man of 38" or a "40-year-old youth". That's because in popular understanding, the notion of youth goes beyond numbers.
In some circles, youth is synonymous with - if not a euphemism for - people struggling to fit into society or those with almost no social responsibilities. Local media also often use the term 'youth' when referring to thugs or rioters, even when the people in question are adults.
As Arnaud Essoh, a computer engineer, observes, this attitude changes if the person described shows signs of social success. "For example, once you start working or get married - irrespective of age, whether you are 22 or 23 - your friends and family stop seeing you as a young person," he says. "They will show you the same kind of respect shown to elders. Ultimately, adulthood here is no longer based on age; it's about a person's financial and social status."
Irresponsible = young?
Luc Hien, 27, points out that defining 'youth' is a challenging exercise. "If we stick to a definition by the United Nations Development Programme, the term 'youth' refers to those between 15 and 24 years old," he says.
According to Stéphane Essoh, who is four years Hien's junior, politicians usually conflate the youth age bracket with the period during which one is irresponsible.
"They see us as children incapable of making any good decisions," he explains. "One only needs to look at the age of youth leaders in political parties or even the age of youth ministers to realise that. They are well above 40 and that has almost always been the case within the PDCI, the RPR and the UDPCI."
Meanwhile, Jeanne Tab notes the general consensus that "a young person is someone who is 35 years old at most". But, the 29-year-old student adds: "In reality, a youth is usually an unemployed person who is still under the care of a parent or a tutor."
If commercial slogans and ad campaigns are any indication, immaturity, irresponsibility, unemployment and carelessness are often associated with youth.
Communications expert Jean-Baptiste Appia points out how ad agencies are part of the problem. In their images and videos, they promote the negative social connotations associated with youth.
"One only needs to look at ads by Prudence on HIV/AIDS and Job Assist on unemployment to see how the youth are portrayed. On the one hand. they are presented as sexually loose, frivolous and irresponsible," he says. "On the other hand, they are jobless, careless and incapable of looking after themselves on the other."
Eric Kouadio is a 28 year old who stands against such labels. According to the communications engineer and volunteer web manager for a local NGO, it is "inappropriate" to associate "humiliating concepts" with the term 'youth'.
"Such definitions of youth hide the fact that many young people are invested in voluntary projects and therefore contribute to public life through their social actions," he says. "Why does one need to have a paid job in order to be considered a responsible and contributing adult in society?"
By Selay Marius Kouassi
Source: Radio Netherlands Worldwide