The London office of Nigerian law firm Olaniwun Ajayi LP announces strategic growth and expansion plans to support clients across Africa

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The London office of Nigerian law firm Olaniwun Ajayi LP announces strategic growth and expansion plans to support clients across Africa

OALP is the first African law firm to develop a London presence offering high end English law capability

The London office of top Nigerian law firm Olaniwun Ajayi LP (OALP) announces its strategy to support both African and international clients with cross border investment and trade throughout Africa.

Launched in December 2021 as a standalone entity, OALP’s London office, Olaniwun Ajayi (UK) LLP, is the first time a leading African law firm has opened in London with English qualified lawyers with high-end expertise in doing business in Africa. It is OALP’s first international presence outside Nigeria.

The London office opened with three partners: senior partner Howard Barrie, Chair of Finance & Project Development Dr Gabriel Onagoruwa and Corporate Finance Chair Chuks Ibechukwu.

The London office’s core focus is Corporate Finance, Energy & Infrastructure and Project Finance offering clients integrated, cross border legal services for investments, projects and initiatives across Africa. The London office will also support the firm’s existing transactional capabilities in corporate finance, project development, corporate, M&A and private equity, supporting financial institutions, project sponsors, private and institutional investors, governments and government agencies with specialised English law capability which is key in many overseas investments across Africa.

Commenting on the London office strategy, managing partner Howard Barrie said: “Olaniwun Ajayi, London is OALP’s first international presence outside Nigeria with plans to extend its office network throughout Africa. Its unique approach will be to build on the firm’s market leading reputation for high end legal services across the key industrial and commercial sectors in Africa including power & renewable energy, infrastructure & utilities, oil & gas, mining & metals, manufacturing, healthcare, agribusiness and fintech. We are ideally placed to offer African and international clients an English law capability with a focus on corporate & project financing, infrastructure & energy.”

He added: “There have been significant changes in the requirements of international and domestic investors in and from Africa due to the multi-jurisdictional and cross-border nature of financing business, trade and infrastructure, frequently governed by English law. In the past, these investors and financial institutions have looked to international law firms based in London or Paris which have then in turn needed to work with a local law firm to provide relevant domestic legal advice. This model may not fully take into account the regulatory and cultural sensitivities that an Africa-centric approach provides. Olaniwun Ajayi is now able to fill this gap and provide clients with significant alternative options in investment or corporate and finance transactions.  It is clear that clients recognise the value of our proposition, the depth of experience within our team, and the efficiencies our strategy offers in terms of deal execution, which translates into better cost management and is critical given the macroeconomic headwinds in Nigeria and other African economies.”

Olaniwun Ajayi is planning additional recruitment in London and to extend their service offering in line with client requirements. The overriding aim is to develop a pan African structure where the firm’s services can be accessed throughout Africa and other key jurisdictions more closely integrated with the needs of the law where the transaction is taking place.

Howard Barrie advises on international project and structured trade finance and cross-border lending. He has advised governments, development finance institutions, project developers and commercial banks on financings including public-private partnerships. He has worked on transactions in more than 16 African countries.  Prior to launching OALP London, Howard was a partner in major international law firms for 29 years and is recognised as an Africa specialist in energy and infrastructure, oil and gas and mining sectors. He has been shortlisted by the Financial Times for its Legal Innovator of the Year award and recognised as one of The Lawyer’s Hot100 for his work in Africa.

Before joining Olaniwun Ajayi in London, Chuks Ibechukwu was Senior Counsel and Africa Regional Lead for Advisory Services, Private Equity and Funds at the International Finance Corporation and worked for over a decade at UK and US international law firms, including Latham & Watkins and Allen & Overy. He specialises in corporate, project and infrastructure finance, asset, leveraged and acquisition finance and debt capital markets, with a particular interest on impact investing and development finance, and he has advised on more than 50 project, corporate and structured finance deals contributing over US$40 billion of committed capital in 20 emerging markets.

Dr Gabriel Onagoruwa is a highly experienced transactional lawyer who specialises in energy and infrastructure projects in Africa. He was previously at White & Case and his practice focuses on advising development finance institutions, national and international oil companies, commercial banks, multilateral lending agencies, sponsors and developers on large-scale project financings, structured finance, investments and acquisitions across the energy, power, renewables, oil and gas including LNG, petrochemical, mining and real estate sectors. He regularly advises on market leading cross-border transactions in these sectors in Nigeria and across Africa.

Regulatory and deal developments in South African fintech

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Regulatory and deal developments in South African fintech

 By Ashlin Perumall, Partner, Baker McKenzie Johannesburg

 South Africa is an African fintech frontrunner, with several recent regulatory developments taking centre stage as the country prepares to fully adopt fintech and its various sub-segments. South Africa also has specific compliance and due diligence issues that must be addressed before and during fintech transactions.

Regulatory developments

South Africa has taken a coordinated approach to fintech across its regulators, first creating the Intergovernmental Fintech Working Group or IFWG, a consortium of the key financial regulators. This consortium includes the South African Reserve Bank, which also doubles up as the prudential authority and monetary systems regulator, the Financial Sector Conduct Authority (FSCA), the Financial Intelligence Centre and the country’s credit regulator. This group has engaged in public-private participatory discussions and the production of position papers to settle on the policies to advise the drafting of regulations.

Much of the focus of the IFWG has been the regulation of crypto assets, with anti-money laundering and South African exchange control being the primary focus areas. In short, South Africa is likely to adopt the approach of including crypto asset service providers within the remit of regulated financial service providers and accountable institutions in respect of Know your Customer (KYC), and also become more stringent on the cross-border flows of value enabled by crypto assets.

In the wider fintech arena, South African regulators have focused on the payments regulation environment, given the size of this sub-segment and because it has been due for a significant overhaul for some time as part of the central bank’s Vision 2025 programme. Vision 2025, commissioned in 2000, sets out the goals and strategies for the national payments industry, aimed at building a world-class national payment system that serves the economy and the people of South Africa.

Most recently, the South African Reserve Bank announced that it was working on a new Rapid Payments Programme (RPP). The RPP is aimed at modernising real-time payments such as immediate credit push, pay by proxy and request to pay functionality in the national payment system. When fully implemented, the SARB has stated that the RPP will offer a cost effective instant payment service across banks, a proxy service to embed user banking details, a request to pay service, as well as support for several known retail payment use cases. The SARB noted that it is working with several bank participants to build the technology solution that forms the backbone of the RPP solution. It is currently in the testing phase with its implementation planned for the second half of 2022.

Issues in South African fintech deals

The most prominent issue we still encounter during fintech deals in South Africa is the housing of the intellectual property (IP) in South African corporate startups. South Africa is subject to an exchange control regime, whereby any transfer of intellectual property offshore from residents requires Reserve Bank approval. As a result, many fintechs have either structured around this with IP sitting in offshore vehicles, or have not, which then separately raises concerns with many VC investors on global expansion. Either way, IP presents a specific deal structuring and diligence issue which must be looked at carefully in the South African context.

A more obvious deal issue is that most fintechs are Founder-owned and run startups with lean capital outlay, particularly for legal compliance. Nonetheless, the dramatic difference in round sizes from average seed capital to huge Series A or B rounds means that these companies suddenly are  considered to be mid-sized business in the country. The financial industry in South Africa is heavily regulated with robust, and active regulators, and regulatory compliance for mid to large institutions is essential. Noting that these sudden injections of capital should come with legal and regulatory investment is a must. Further, assessing the extent of this at due diligence stage is key to ensuring that the post-investment deployment of capital is geared towards closing these compliance gaps quickly.

Founder engagement is also important. We’ve seen that Founder reliance is quite heavy in African fintech’s generally, with centralization of both control and business value sitting with a few individuals and not institutionalized across fintech targets. This means that relationship building ahead of investments with Founders and key team individuals is crucial, as well as appropriate commitments and alignment of post-acquisition goals. Often Founders will expect investors to go along for the journey, so to speak, which may include future goals that are attractive to investors together with those that are not. Often, these goals include outside of Africa expansion, which may not necessarily align with investor goals. Reading data room slide decks on business growth and objectives should be treated as a source for issue spotting, alongside current arrangements and agreements.

 Whatever the challenges, fintech is guaranteed to be part and parcel of South Africa’s financial systems in future, as the country gears up to be able to implement financial technology in a way that benefits both the economy and its citizens.

World Trade Organization waives intellectual property rights to support vaccine production in Africa

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World Trade Organization waives intellectual property rights to support vaccine production in Africa

By Virusha Subban, Partner and Head of Indirect Tax, Baker McKenzie Johannesburg

The World Trade Organisation (WTO) announced in June 2022 an agreement to waive the intellectual property rights that usually apply in the manufacturing of vaccines, to assist the production of COVID-19 vaccines in developing countries. The measures were proposed to the WTO by the South African and Indian governments, with other developing countries supporting the move. The waiver agreement received unanimous support from WTO member countries. The agreement by multilateral parties indicates the level of global support and potential for partnerships to enable vaccine production in Africa.

The agreement means that governments in developing countries will be able to authorize the production of much needed vaccines or their ingredients, substances and elements, and use patented processes without patent holder permission during the pandemic. According to the World Health Organization, the continent has fully vaccinated just 15% of the adult population.

The agreement has been lauded for its role in boosting the global pharmaceutical supply chain and healthcare sector manufacturing capacity on the continent. In 2020, the African Union African Peer Review Mechanism published a report on Africa’s governance response to COVID-19,  which highlighted Africa’s supply chain challenges and overreliance on foreign trade and suggested that the continent boost its manufacturing capacity to build a strong African supply chain that could not be weakened by global blockages.

Africa needs a strong vaccine manufacturing capacity to tackle this and future pandemics. According to the International Finance Corporation (IFC), around 70 to 90 percent of the medicines consumed in Sub-Saharan Africa are imported. The Brooking Institution noted that Africa represents 25% of the global demand for vaccines, but imports 99% of its vaccine doses, with the 1% produced on the continent mostly relegated to the fill and finish steps.

Many WTO members have been actively involved in assisting countries in Africa to upscale their healthcare systems and boost local vaccine production. According to the European Commission, the European Union (EU), its member states, and the European development finance institutions, together known as Team Europe, are Africa’s top partners and the largest providers of Official Development Assistance in Africa. One of the aims of Team Europe has been to assist the continent with its pandemic recovery by investing in resilient healthcare systems and local vaccine production. The EU has provided a total of EUR 100 million in humanitarian assistance to support the rollout of vaccination campaigns in Africa, as well as to help ensure access to vaccines for vulnerable people, including in conflict-affected or hard-to-access areas.

At the Forum on China-Africa Cooperation in 2021, it was announced as part of China’s medical and health program that China would provide one billion doses of COVID vaccines to Africa, with 600 million of those doses being a gift, and 400 million produced by Chinese companies and via joint ventures with African countries.

According to USembassy.gov, the United States (US) and its partners had donated more than 50 million doses of COVID-19 vaccines to African nations by the end of 2021. It was also reported that a US pharmaceutical firm planned to build a vaccine production facility in Africa that could produce up to 500 million doses annually. The US has invested USD 100 billion to strengthen health security in sub-Saharan Africa over the past 20 years.

The UK Government reported on its website that by the end of 2021, GBP 105 million in UK emergency aid has been pledged to vulnerable countries to tackle COVID-19, with a strong focus on Africa. By the end of 2021, 30 million vaccines donated by the UK had reached four continents and provided COVID-19 protection in African countries including Angola, the Democratic Republic of Congo, Ethiopia, Ghana, Kenya, Malawi and Rwanda.

Last year, the IFC, the French Development institution PROPARCO, the German development finance institution DEG and the US International Development Finance Corporation (DFC) finalized a EUR 600 million joint financing package to enable the Aspen Group to produce vaccines in South Africa. A Financial Institutions team from Baker McKenzie advised the Aspen Group on this transaction. The IFC previously noted that this transaction was the largest investment and mobilization in the healthcare sector the organization has led globally to date. The South African-headquartered pharmaceutical company is playing a leading role in producing COVID-19 vaccine treatments and therapies for use across Africa.

Four vaccine initiatives are already underway in South Africa. The South African Government has noted that this WTO agreement will waive IP protections for Covid-19 vaccines to stimulate African industrialization, boost trade potential and unlock manufacturing capacity and innovation across the content. The Minister of Trade and Industry, Ebrahim Patel, said there would now also be an increased focus on promoting African vaccine producers to global procurers.

The WTO agreement will promote investment in the African healthcare and life sciences sector and supporting infrastructure, and ultimately improve reciprocal trade between the continent and its major trading partners. Most importantly, the increased manufacturing capacity for pharmaceutical products will drastically improve the ability of African governments to deliver efficient healthcare solutions for their citizens in the years to come.

ECA inaugurates the fourth edition of Africa Climate Talks..

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ECA inaugurates the fourth edition of Africa Climate Talks..

ADDIS ABABA, Ethiopia, 28 July 2022 / PRN Africa / — The all-important fourth edition of the Africa Climate Talks (ACTs!), takes place in Maputo, Mozambique this week under the theme “Ensuring a just and equitable transition and human security in Africa: building resilience.”

Convened as hybrid in-person and virtual participation, ACTs 2022 is co-hosted by the Economic Commission for Africa (ECA) and Eduardo Mondlane University, with the participation of other UN Agencies, the Africa Union Commission, African Development Bank, and the Pan-African Climate Justice Alliance (PACJA).

ACTs! 2022 ACTS comes against the backdrop of more frequent and severe weather events, including unprecedented droughts, cyclones and tropical storms in East and Southern Africa. The West Indian Ocean region in particular has suffered considerable damage and losses from weather and climate related events.

The first session ACTs! 2022, which open on 27 July, cover the Eastern and Southern African regions of the continent. A second edition will be convened in Niger, casing the experiences and perspectives of the central, western and northern African regions. The African Climate Talks has established itself as an important dialogue space that gathers regional climate perspectives from the grassroots organizations, civil societies, youth, women groups, the private sector alongside the academia and governments.

Since inception in the lead up to the Paris Agreement in 2015, ACTs! has served as the ground zero, which sets in motion the consolidation of an African common position at the annual United Nations Conference of Parties meeting on climate change. ACTs! serves as a forum for the continent to deliberate current concerns and catalyze African narratives and perspectives on climate change and economic development.

James Murombedzi who heads the African Climate Policy Centre (ACPC) says that the fourth ACTs! brings together Africa’s academia, civil society, private sector, regional institutions and development partners to contribute to continental discourses aimed at amplifying African narratives and solutions to the climate emergency.

The deliberations of the Maputo meeting will cover disaster preparedness, early warning systems, and insights of the sixth assessment report by the Intergovernmental Panel on Climate Change (IPCC), just transition, resilience building and the global stock take on adaptation. The all-inclusive forum will also benefit from engagement with the different policy and practical responses to climate impacts, and seek to contribute to the realization of the aspirations of Africa’s Agenda 2063 and the 2030 Agenda for Sustainable Development by identifying pathways to climate resilient development.

According to Murombedzi, the revitalized fourth ACTs! deliberations will also spotlight just transitions, science-informed climate action and resilience building. The solutions-oriented ACTs! will dwell on effective early-warning, early action systems and a just-transition that supports sustainable economic development pathways for Africa.

The issue of regional cooperation, continental synergies and global solidarity, aided by a strong multilateral framework in line with the aspiration of the Paris Agreement framework will also feature in the intensive ACTs! deliberations.

The 2022 edition of the ACTs! forum will help formulate the agenda and tone setting for the much-awaited CCDA-X conference that crystallizes the African message for COP27 slated for Sharm el Sheikh in Egypt later in November.

According to Murombedzi, the fourth ACTs! is cognizant of the climate related hazards facing the region and prioritizes science-based, informed decision making to empower policy and decision makers to act appropriately in a timely manner to safeguard development gains as well as ensure ocio-economic progress.

SOURCE United Nations Economic Commission for Africa

Kenya: Shared prosperity – the United States and Kenya sign Strategic Trade and Investment Partnership

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Kenya: Shared prosperity – the United States and Kenya sign Strategic Trade and Investment Partnership

By Virusha Subban, Partner specialising in Customs and Trade, Head of Tax, Baker McKenzie Johannesburg

The United States-Kenya Strategic Trade and Investment Partnership (STIP) was signed on 14 July 2022. The agreement outlines the enhanced engagement and high standard of commitment between the two countries, and focuses on increased investment and sustainable and inclusive growth that will be of benefit to both countries’ citizens and businesses. The agreement also includes the intention to support regional economic integration in East Africa.

A year ago, in July 2021, the United States (US) administration announced that it would renew its Prosper Africa initiative, to increase reciprocal trade and investment between the US and African countries. At that time, the US noted that the initiative would focus on improving trade and investment in sectors such as infrastructure, energy and climate solutions, healthcare and technology. Seventeen US government agencies working as part of this initiative were given a mandate to, among other things, empower African businesses, offer deal support and connect investors from the US with those in Africa.

Also noted at the renewed Prosper Africa launch was the intention to focus on trade projects that supported women, and small and medium enterprises in Africa. Under President Biden, US engagement with African countries promised to focus on strengthening these trade relationships in a strategic, co-operative and reciprocal way under the vision of ‘shared prosperity’ between Africa and the US.  The US has also expressed its support for the African Continental Free Trade Area, the Africa-wide free trade zone, stating that it wants to see the growth of Africa’s economic power in the world.

Via the US-Kenya STIP, the two countries have identified key areas that they will develop into “an ambitious roadmap for enhanced cooperation” including agriculture, anti-corruption, digital trade, environment and climate change action, good regulatory practices, a focus on micro, small and medium enterprises (MSMEs), promoting workers’ rights and protections, supporting the participation in trade of women, youth and others, increased collaboration on standards and the facilitation of trade and customs procedures. The agreement has a heightened focus on sustainability, innovation and good governance, and highlights the requirement that all measures introduced under the agreement must be advantageous to local communities, consumers and businesses in both countries.

With regard to the agricultural sector, the agreement notes that an enabling environment for agricultural innovation will be facilitated to increase food security and farm productivity. It also outlines the role of digital inclusion and accessibility, the need for resilient and secure digital infrastructure and online consumer protection in order to foster trust, address discrimination and promote development in the digital economy. Emerging issues in digital trade will also be monitored and considered. Environmental protection, climate change adaptation and mitigation and conservation are also high on the agenda. Both countries have highlighted the importance of sustainability when using natural resources as they strengthen their mutual commitments and trade relationship. A commitment to sound regulatory practices, such as adequate time for public consultations on proposed regulations, basing decisions on science and evidence and regularly undertaking risk and regulatory impact assessments is also noted as a key focus area.

The agreement outlines the importance of supporting MSMEs, in particular those owned by women, youth and persons with disabilities, stating that this is essential for sustainable economic growth. Best practice exchanges and roundtables are planned in this regard. Issues such as good pay, high quality jobs and the development of trade policies that facilitate the role of women and children in international trade are key focus areas of this agreement. Workers’ rights and protections, in particular compliance with local labour laws and the promotion of dialogues and mutual cooperation in the labour and employer arena, are also regarded as areas of importance.

The two countries stated via the agreement that they will engage in detail on their respective trade processes, and prepare, adopt and apply regulations, standards and procedures based on mutually agreed practices. They also acknowledged the pandemic’s impact on supply chains and the benefits of introducing streamlined and simplified border procedures, especially in terms of access for new entrants to the market. Also acknowledged in the agreement is the importance of accelerating the implementation of the World Trade Organisation Trade Facilitation Agreement, which provides for the expedited movement and clearance of goods, and outlines trade facilitation and customs compliance cooperation measures for customs authorities. The STIP agreement also notes that customs practices and enforcement procedures between the two countries will be considered in a mutually cooperative and transparent way. The introduction of trusted trade benefits for low risk importers, particularly for participants in the Authorized Economic Operator program, will also be considered. This will be a significant development that other African customs authorities will surely take note of and aim to emulate in the future.

The agreement aligns with and reinforces the ideals laid out in the US’s Prosper Africa initiative and, as such, further reciprocal bilateral and regional trade agreements with Africa countries are expected to be signed in the near future. Such agreements are expected to eventually replace the non-reciprocal African Growth and Opportunity Act (AGOA), which allows duty- and quota-free exports from eligible African countries into the US, and which is due to expire in 2025. The enhanced engagement and commitment outlined in the US-Kenya STIP will provide numerous opportunities for the citizens and businesses of both countries to prosper from increased and sustainable trade and investment.

The impact of the G7’s multi-billion dollar plan on Africa’s infrastructure gap   Heightened focus on sustainability and social impact

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The impact of the G7’s multi-billion dollar plan on Africa’s infrastructure gap   Heightened focus on sustainability and social impact

By Michael Foundethakis, Baker McKenzie’s Global Head of Projects and Trade & Export Finance, and Africa Steering Committee Chair

In late June 2022, it was announced at the G7 Summit in Germany that a USD 600 billion lending initiative, the Partnership for Global Infrastructure Initiative (PGII), would be launched to fund infrastructure projects in the developing world, with a particular focus on Africa. The G7 countries – Canada, France, Germany, Italy, Japan, the United Kingdom (UK) and the United States (US) – explained the PGII would help address the infrastructure gap in developing countries.

The US

The US has recently renewed its focus on impact-building and financing strategic, long-term infrastructure projects in Africa, with the Export-Import Bank of the United States (EXIM) supporting infrastructure development on the continent. According to a 2020 report by McKinsey and Company – Solving Africa’s infrastructure paradox – the US accounts for 38% of global investors who have an appetite for African investment, by far the most of any country. In 2021, the US launched a refreshed “Prosper Africa initiative”, focusing on improving reciprocal trade and investments that create jobs and build infrastructure between the two regions. In 2022, the US announced it would mobilise USD 200 billion over the next five years as part of the PGII, in the form of grants, financing and private sector investments. Some deals have already been announced, including, for example, a USD 2 billion solar energy project in Angola, and the building of multiple hospitals in Côte d’Ivoire.

The EU

In February 2022, the European Commission announced investment funding for Africa worth EUR 150 billion. The funding package is part of the EU Global Gateway Investment Scheme and is said to be in the form of EU combined member funds, member state investments and capital from investment banks.

In early 2020, the European Commission published its Comprehensive Strategy with Africa, outlining the region’s plans for its new, stronger relationship with the continent. The strategy document laid out five top priorities for the EU in Africa: the green transition and improving access to energy; digital transformation; sustainable growth and jobs; peace and governance; and migration and mobility.

The UK

The UK is also making a strong play for influence, investment and trade with Africa, post-Brexit. Further to key summits in 2020 and 2021, finance is being redirected into Africa from the UK. In 2022, UK development finance institution (DFI), British International Investment (formerly CDC Group), announced it had exceeded its pledge to invest GBP 2 billion in Africa over the last two years. The UK’s Global Infrastructure Programme helps partner countries (including in the African continent) to build capacity to develop major infrastructure projects, setting up infrastructure projects for success and paving the way for UK companies to support these projects.

Further, in November 2021, it was announced that the governments of South Africa, France, Germany, the United Kingdom and the United States of America, along with the European Union, were in negotiations to form a long-term Just Energy Transition Partnership. The partnership focuses on boosting the decarbonisation of the South African economy, with a commitment of USD 8.5 billion for first round financing. It is expected that 1-1.5 gigatonnes of emissions will be prevented over the next 20 years, assisting South Africa to accelerate its just transition. Discussions are also currently taking place to establish a similar partnership in Senegal.

African solutions

The African Development Bank noted in early 2022 that Africa’s infrastructure investment gap is estimated at more than USD 100 billion per year.

DFIs are increasingly anchoring the infrastructure ecosystem in Africa – serving a critical function for project finance as investment facilitator and a check on capital. DFIs can shoulder political risk and access government protections in a way that others cannot, enter markets others cannot and are uniquely capable of facilitating long-term lending. The large amount of capital needed to fill the infrastructure gap, however, means that DFIs cannot bridge it alone. Private equity, local and regional banks, debt finance and specialist infrastructure funds are primed to enter the market, and multi-finance and blended solutions are expected to grow in popularity as a way to de-risk deals.

The African Union’s 55 member states have stated that their primary funding needs include support in terms of safety and security on the continent, as well help in implementing the African Continental Free Trade Agreement (AfCFTA) and the massive infrastructure investment it needs to be successful. The development of supporting infrastructure is key to boosting AfCFTA’s free trade potential, especially in terms of transportation, energy provision, internet access and data services, education and healthcare infrastructure projects.

Infrastructure projects in Africa now also have a heightened focus on improving Africa’s capacity for green, low-carbon and sustainable development, via, for example, clean energy, community healthcare and support, green transport, sustainable water, wildlife protection and low-carbon development projects. Funding such projects comes with responsibility –  projects must not only be bankable and yield attractive returns, but must also be sustainable and provide tangible benefits to local economies and communities. All of Africa’s major partners have noted they will prioritise projects that commit to Environmental, Social and Governance principles, and access to capital for large infrastructure projects is likely to contain sustainability requirements.

That the focus of the PGII is on the sustainability and the social impact of these projects in Africa is further evidenced in the White House briefing room statement issued at the launch in June 2022, where it was stated that the PGII will “mobilize hundreds of billions of dollars and deliver quality, sustainable infrastructure that makes a difference in people’s lives around the world…”

World Trade Organization waives intellectual property rights to support vaccine production in Africa

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World Trade Organization waives intellectual property rights to support vaccine production in Africa

By Virusha Subban, Partner and Head of Indirect Tax, Baker McKenzie Johannesburg

In June 2022, the World Trade Organization (WTO) announced an agreement to waive the intellectual property rights that usually apply in the manufacturing of vaccines, to assist the production of COVID-19 vaccines in developing countries. The measures were proposed to the WTO by the South African and Indian governments, with other developing countries supporting the move. The waiver agreement received unanimous support from WTO member countries. The agreement by multilateral parties indicates the level of global support and potential for partnerships to enable vaccine production in Africa.

The agreement means that governments in developing countries will be able to authorize the production of much needed vaccines or their ingredients, substances and elements, and use patented processes without patent holder permission during the pandemic. According to the World Health Organization, the continent has fully vaccinated just 15% of the adult population.

The agreement has been lauded for its role in boosting the global pharmaceutical supply chain and healthcare sector manufacturing capacity on the continent. In 2020, the African Union African Peer Review Mechanism published a report on Africa’s governance response to COVID-19,  which highlighted Africa’s supply chain challenges and overreliance on foreign trade and suggested that the continent boost its manufacturing capacity to build a strong African supply chain that could not be weakened by global blockages.

Africa needs a strong vaccine manufacturing capacity to tackle this and future pandemics. According to the International Finance Corporation (IFC), around 70 to 90 percent of the medicines consumed in Sub-Saharan Africa are imported. The Brooking Institution noted that Africa represents 25% of the global demand for vaccines, but imports 99% of its vaccine doses, with the 1% produced on the continent mostly relegated to the fill and finish steps.

Many WTO members have been actively involved in assisting countries in Africa to upscale their healthcare systems and boost local vaccine production. According to the European Commission, the European Union (EU), its member states, and the European development finance institutions, together known as Team Europe, are Africa’s top partners and the largest providers of Official Development Assistance in Africa. One of the aims of Team Europe has been to assist the continent with its pandemic recovery by investing in resilient healthcare systems and local vaccine production. The EU has provided a total of EUR 100 million in humanitarian assistance to support the rollout of vaccination campaigns in Africa, as well as to help ensure access to vaccines for vulnerable people, including in conflict-affected or hard-to-access areas.

At the Forum on China-Africa Cooperation in 2021, it was announced as part of China’s medical and health program that China would provide one billion doses of COVID vaccines to Africa, with 600 million of those doses being a gift, and 400 million produced by Chinese companies and via joint ventures with African countries.

According to USembassy.gov, the United States (US) and its partners had donated more than 50 million doses of COVID-19 vaccines to African nations by the end of 2021. It was also reported that a US pharmaceutical firm planned to build a vaccine production facility in Africa that could produce up to 500 million doses annually. The US has invested USD 100 billion to strengthen health security in sub-Saharan Africa over the past 20 years.

The UK Government reported on its website that by the end of 2021, GBP 105 million in UK emergency aid has been pledged to vulnerable countries to tackle COVID-19, with a strong focus on Africa. By the end of 2021, 30 million vaccines donated by the UK had reached four continents and provided COVID-19 protection in African countries including Angola, the Democratic Republic of Congo, Ethiopia, Ghana, Kenya, Malawi and Rwanda.

Last year, the IFC, the French Development institution PROPARCO, the German development finance institution DEG and the US International Development Finance Corporation (DFC) finalized a EUR 600 million joint financing package to enable the Aspen Group to produce vaccines in South Africa. A Financial Institutions team from Baker McKenzie advised the Aspen Group on this transaction. The IFC previously noted that this transaction was the largest investment and mobilization in the healthcare sector the organization has led globally to date. The South African-headquartered pharmaceutical company is playing a leading role in producing COVID-19 vaccine treatments and therapies for use across Africa.

Four vaccine initiatives are already underway in South Africa. The South African Government has noted that this WTO agreement will waive IP protections for Covid-19 vaccines to stimulate African industrialization, boost trade potential and unlock manufacturing capacity and innovation across the content. The Minister of Trade and Industry, Ebrahim Patel, said there would now also be an increased focus on promoting African vaccine producers to global procurers.

The WTO agreement will promote investment in the African healthcare and life sciences sector and supporting infrastructure, and ultimately improve reciprocal trade between the continent and its major trading partners. Most importantly, the increased manufacturing capacity for pharmaceutical products will drastically improve the ability of African governments to deliver efficient healthcare solutions for their citizens in the years to come.

Study: African business leaders expect start-up boom

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Study: African business leaders expect start-up boom

 

  • Nearly 70% forecast the value of start-ups in Africa will more than double in five years
  • But cumbersome regulations and internet connectivity to address the digital skills gap could hold back expansion

African business leaders are predicting a boom in start-up businesses across the continent as the number of working age people launching new firms expands,  new research for blockchain-based mobile network operator World Mobile shows (please see the attached press release).

Start-ups across the continent are currently valued at around $7.6 billion – around 0.2% of the total $3.8 trillion value of start-ups globally – but nearly seven out of 10 (69%) of senior African business executives believe that will more than double in the next five years.

The rise in the predicted value of start-ups will be driven by growth in the numbers of people starting companies, the study with African business leaders from companies with combined annual revenues of more than $6.75 billion found.

Before the pandemic around 22% of working age adults on the African continent started new businesses***. But the research among senior executives based in Angola, Botswana, Cameroon, Ethiopia, Ghana, Nigeria, South Africa, and Tanzania found they expect that number to grow.

More than two out of five (43%) business leaders believe around a quarter of working age adults will have started their own businesses within five years. Almost all (97%) questioned expect the rate to increase from the pre-pandemic 22%.

Business leaders worry new business creation could be blocked by cumbersome regulations and a lack of digital skills due to poor internet connectivity seen as the biggest issues ahead of limited funding and fragmented markets.

They are hopeful about improvements – 70% expect the regulatory issue to become less of a problem over five years while 60% believe the digital skills gap on the continent will close.

 

Telecoms will be the fastest growing African business sector

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Telecoms will be the fastest growing African business sector

 

  • Three out of four African business leaders predict telecoms will lead the way on growth in the next five years 
  • Improvements in internet connectivity will be crucial to driving expansion in the wider economy

The telecoms sector will be the fastest-growing industry in Africa over the next five years as internet connectivity improves, new research* with business leaders for blockchain-based mobile network operator World Mobile shows.

When asked to pick the three sectors that they believe will see the strongest growth over the next five years, three out of four (75%) senior executives selected telecoms in the study.

It was comfortably ahead of the healthcare sector which emerged as the second choice selected by 61% of survey respondents as one of three industries that will see the strongest growth ahead of tourism at 44%

Senior executives at companies with combined annual revenues of more than $6.75 billion based in 

Tanzania, Angola, Botswana, Cameroon, Ethiopia, Ghana, Nigeria, and South Africa were interviewed for the study.

Improvement in internet connectivity was identified as central to growth in the economy and across all sectors. Around two-thirds (66%) say it is important while 20% believe it is very important. The table below shows which sectors senior business executives believe will be the fastest-growing over the next five years.

 

SECTOR HOW MANY EXECUTIVES BELIEVE IT WILL BE ONE OF THE TOP THREE FASTEST GROWING SECTORS IN AFRICA OVER THE NEXT FIVE YEARS
Telecoms 75%
Healthcare 61%
Tourism 44%
Financial services 36%
Retail 36%
Manufacturing 22%
Education 22%

 

World Mobile is helping to revolutionise internet connectivity in sub-Saharan Africa and is already working with the government in Zanzibar where it is launching a unique hybrid mobile network delivering connectivity supported by low altitude platform balloons. 

Its blockchain-based network vastly reduces capital expenditure and cuts costs compared to traditional telecom operators. World Mobile is in discussions to expand in Tanzania and Kenya, as well as other territories underserviced by traditional mobile operators. 

Micky Watkins, CEO of World Mobile said: “The expansion of telecoms across the African continent is central to driving economic growth and senior business executives clearly agree as they rank it well ahead of other major sectors of the economy.”

“To a great extent, growth in telecoms spurs growth in other sectors as societies become more digital and technology focused and that applies very much to financial services, healthcare, retail and education.”

“Not all parts of Africa however have strong internet connectivity and we want to help by providing a service which is affordable and reliable and look forward to working with governments across the continent.”

  World Mobile’s balloons will be the first to officially launch in Africa for commercial use, offering a more cost-effective way to provide digital connection to people and is the first step in its mission to help bring nearly four billion people online before 2030 in line with the UN and World Bank’s SDGs. 

The World Mobile approach is more sustainable, in environmental, social and governance terms. Environmental impacts are mitigated using solar-powered nodes, second-life batteries, and energy-efficient technology. World Mobile creates a positive societal impact through the application of its circular economy model – a “sharing economy” where locals share in the ownership and rewards of the network. 

 

Growing organic food, cannabis and medicinal plants: overcoming the challenges of vertical farming

Africa Bulletin
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Growing organic food, cannabis and medicinal plants: overcoming the challenges of vertical farming

The vertical farming market has been growing exponentially in recent years, and though the industry is proving to be increasingly more profitable, the practice of vertical farming is not without its challenges.

Accelerated demand for organic produce as well as rising concerns about sustainability have certainly paved the way for the development of an industry that shows incredible promise, and not just because it addresses consumers’ concerns.

Here, Ian Hart, business development director at adi Projects, a division of the multi-disciplined engineering firm adi Group, gives expert advice on the engineering solutions businesses need to adopt in order to be successful in the vertical farming field.

The advantages

When it comes to solving some of the problems associated with growing crops on soil, including cannabis and medicinal plants, vertical farming has a real role to play.

It is a well-known fact that environmental factors – particularly extreme weather events – can significantly affect the growth of crops, and climate change is an issue too, with experts predicting that rising temperatures might just cause certain types of crops to become extinct.

Vertical farming gives businesses more control over the growth of products, with producers no longer being forced to rely on seasonal changes, weather conditions and other factors that can easily cause disruptions.

Just as valuable in vertical farming is the ability to stack crops, which saves a considerable amount of space, as it is estimated that just one acre of a vertical farm can grow roughly the same amount of product as 10 to 20 soil-based acres.

Though vertical farming can efficiently eliminate some of these risks and concerns while also having a positive environmental impact, not being equipped with the right knowledge and systems to operate in the right way can result is a significant waste of money and resources.

The requirements

Vertical farming facilities have to maintain a delicate indoor environment that satisfies particular conditions.

This chiefly involves the presence of purified air that allow crops to grow without being contaminated by pests, spores and yeast that could easily harm produce.

“Growing plants and vegetables indoors requires specialist watering systems,” begins Ian.

“The plants themselves release large quantities of water as they are growing, so the main issue involves controlling that water within a closed loop air chain system inside the room.

“Air needs to be treated first to remove the contaminants that are present in the air stream, with the added challenge that the air itself will become wet due to the water evaporating from the plants – and this air can’t simply be let out through a window,” continues Ian.

In order to avoid waste and the added costs of cleaning air to such a high standard more times than what is strictly necessary, businesses need to rely on efficient technology that can de-water the clean air and feed it back into the overall system.

What’s the solution?

Using desiccants, which absorb the excess water contained within the purified air, is an effective yet expensive solution.

More convenient and efficient long-term is relying on systems that can exploit the air’s dew points and allow the water to condense back out again, as well as effectively deal with pressurisation and temperature.

“It’s all about facing up to specific challenges and designing bespoke solutions that can keep the environment within those facilities as pure as possible,” says Ian.

“You will naturally experience at least a small percentage of untreated air accidentally making its way into your facility, as well as some purified air escaping, and the ideal engineering solution should allow you to get the balance just right.

“There are multiple process elements that come into this, but getting the overall design correct is crucial,” he adds.

Being mindful from the onset will ensure continuity throughout, removing risk during the planning and construction stages and for the duration of the facility’s lifecycle.

Inefficiency and carelessness will result in waste of energy and ultimately of product, so relying on first-class systems and solutions is crucial.

Why are high standards required?

Though the majority of vertical farming facilities are dedicated to cultivating food crops, being able to grow products of a consistently high standard is particularly important in the context of medicinal plants such as cannabis.

Failing to control air circulation efficiently can lead to a build-up of harmful contaminants inside vertical farming facilities that, left uncontrolled, will inevitably damage the crops.

When it comes to growing products for the pharmaceutical and medical industry, higher standards need to be upheld in order to comply with MHRA regulations.

This is where the aforementioned design factors become even more relevant, as even minor miscalculations can cause producers to be unable to sell their product.

Ultimately, vertical farming provides a number of real opportunities to help brands forge solid reputations as innovators and helping create circular economies.

However, there are obstacles to overcome if vertical farming is to fulfil its potential. Partnering with professionals who have the experience to face these challenges and devise bespoke engineering solutions may just hold the key.

adi develop tailor-made solutions no matter how ambitious the project is, providing assistance every step of the way and integrating quality at every level.

For more information on vertical farming solutions, get in touch with adi today.

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