Further south along Avenida Marginal, a seafront road along Mozambique’s booming capital, sits the newly erected Radisson Blu hotel and the construction site for the expansion of the Southern Sun hotel. A quick right turn up Rua Jose Craveirinha takes you to Avenida Julius Nyerere and the growth center of Maputo’s real estate boom.

Apartment blocks, hotels and modern offices characterise the changing waterfront and city center of Maputo. Slowly displacing the Portuguese colonial style buildings are new condominiums and two to three bedroom apartments that rent for at least $2000 to $3000. The older apartments will still cost about $800 to $1000. Mozambique’s GDP per capita will hit about $1250 for 2013. Prices are obviously inflated. But regardless the increase in price, buyers come in doves, largely from Mozambique’s thriving energy industry. It is no wonder people think this country is Angola waiting to happen, says a finance manager at Vale, at current projected growth numbers for real estate prices, only oil & gas companies will survive in the country.

Office space in the city center goes upwards of $40 per square meter. The price is expensive but not too extreme. But with the growing influx of foreign investors and companies, the prices can only remain reasonable for another one or two years. For comparison, Luanda, Angola’s thriving capital offered similar prices per square meter before its oil boom. Now businessmen pay upwards of $100 per square meter in the city. The change in prices, continues the finance manager at Vale, climbed sharply from reasonable to ridiculous in a matter of two years.

For several years Luanda has been in the top two for most expensive cities in the world, often taking the top spot. That is partly due to a rapid influx of oil money and partly due to a limited supply of goods after the civil war ended in 2002. Maputo is more gas money than oil money (for now) and has strong trade with South African companies. But the positives that lend well for keeping food prices down do not affect real estate.

Specifically limited supply of hotel rooms and office spaces will persist for the near future. If you could double the amount of real estate tomorrow, says one government insider, then maybe price growth could slow. This is not possible but do not think investors and developers are not working together to make such growth happen in near term. Skyrocketing prices and accompanying investment returns attract investors from Europe and Asia. The Portuguese were first movers of some sort to their former colonial outpost but have been slowed by tightening restrictions on their movement into the country. Now other Europeans join the South Africans and Asians in reaping the rewards of the sector.

Maputo may not see Angola’s prices for local goods. A bar of soap in Luanda can be double the price of the same brand in Maputo. The same goes for certain foods and beverages. Maputo is still a tourism heaven, says one local real estate agent, with its beaches, open culture, and kind people which are hard to find in tandem in most parts of the world. But, he continues, one cannot think that the gun on its flag feels pressed against your head when you see the bill for your monthly rent whether commercial or personal.

The post Mozambique’s Skyrocketing Real Estate Prices appeared first on Ventures Africa | .

This move will improve Nairobi’s attempt to be East Africa’s banking and life insurance hub.

Last year, the Central Bank of Kenya (CBK) thoroughly went through three license requests, including JP Morgan Chase’s application. JP Morgan Chase is US’s biggest bank by assets.

“The applicants had been granted approval-in-principle by the end of 2012, and processing for final authorisation was at an advanced stage,” Business Daily quoted CBK as saying in its annual bank supervision report released last week.

JP Morgan Chase follows an increasing number of big global lenders that have set up shop in Kenya in an effort to benefit from huge deals that are being struck in the region.

This office will conduct financing transactions for the bank. However, the office will not take money from the people.

The CBK revealed that it had approved the applications of the Central Bank of India and Rwanda’s Bank of Kigali already.

Apparently, these lenders have already opened offices in Nairobi.

According to Business Daily, other international lenders with a presence in Kenya include British-based HSBC, India’s HDFC, Bank of China, and South Africa’s Nedbank and First Rand.

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Speaking to the National Assembly’s portfolio committee on economic development concerning its corporate plan for 2013/14, Safa’s chief executive, Thakani Makhuvha, said the agency hopes to double lending and the number of business owners financed – with disbursements reaching almost R1.6 billion ($175 million) to over 34 000 small firms; in the next five years.

The Agency is also looking forward to expanding the pilot project it has with the SA Institute of Chartered Accountants in a programme which takes young graduates and trains them on how to assist small businesses, from Gauteng to KwaZulu-Natal and Mpumalanga while rolling out further nine branches or satellite offices per year, which would be co- located within Seda or IDC branch offices, to add to the 11 regional offices it already has.

Sefa lends between R500 ($55) and R5 million ($546,000) to small, micro and medium enterprises through retail finance intermediaries, via banks, using its credit guarantee scheme, and directly to private individuals.

Makhuvha said the cost of Sefa lending finance to business owners is expected to fall from 44c – for every rand disbursed in 2013/14 to 25c for every year lent out in 2017/18.

The Industrial Development Corporation (IDC) has committed over R987 million ($108 million) as a shareholder’s loan to the agency until the end of 2014/15, with an option of a further R400 million capital injection in two years time.

IDC’s chief executive Geoffrey explained that the transaction had been structured as a loan and not a grant because there had to be a chance for the IDC of recouping the loan to ensure that Sefa funds sustainable businesses.

“What we are not planning on doing is that we give funding to Sefa and that they then become reckless,” he said.

The post South African SMEs To Get $80.5m Boost appeared first on Ventures Africa | .

Commenting on the $9.04 million initial phase project which is expected to rehabilitate 2 treatment works, complete the Chikanga Reservoir, and supply laboratory and other equipment for maintenance, ZimFund Manager, Eng. Emmanuel Nzabanita said, “I am delighted that this project that is expected to have a major impact on the people living in Mutare has commenced.

The UWSSR project has been designed to improve the health and social wellbeing of the residents of the beneficiary cities, through the equitable provision of adequate water supply and sanitation services, thereby reducing the wide spread of cholera and other water related diseases.

The ZimFund grant will enable the provision of urgent support for the restoration and stabilization of water supply and sanitation services in the six municipalities, by undertaking emergency rehabilitation to the systems and reducing pollution of the water sources.

In addition to the water and sanitation projects, ZimFund is also supporting the Emergency Power Infrastructure Rehabilitation Project (EPIRP) to the tune of $35 million.

The EPIR Project is linked to UWSSR Project, in that it will also improve the electricity supply to the water treatment plant of the Harare city water supply as well as the other five urban water supply systems, with a possible contribution to the reduction in the incidence of cholera and other water related diseases.

The post Zimbabwe Multi-Donor Trust Fund Launches Infrastructure Development Project appeared first on Ventures Africa | .

Egyptian investment bank, EFG Hermes, already dominant in the Gulf and flush with Qatari money, is now targeting wealthy African investors.

VENTURES AFRICA – 2012 was a dramatic year for EFG Hermes, the Cairo based investment bank with a market capitalisation of around $800 million. The ructions of the Arab Spring, particularly severe in its Egyptian home turf, caused the company’s income to fall sharply.

In early 2012, Qatar-based QInvest offered EFG Hermes $250 million in return for 60 percent of most of its operations, with the company name changed to EFG Hermes Qatar. Within weeks, a rival investor appeared. Planet IB, which claimed to have backing from wealthy businessmen including telecoms billionaire Naguib Sawaris, offered to pay $1 billion for 100 percent of the company’s equity.

The company brushed off this attempted hostile takeover, saying that it was unclear who the investors in Planet IB were or what funds they held. Naguib Sawaris failed to confirm his interest in the company and the deal evaporated, leaving QInvest as the sole bidder.

This was all very exciting for Egyptian market watchers, who had never experienced a hostile takeover before. It also held the interest of commentators in the region, who had grown accustomed to EFG Hermes playing a dominant role in investment banking over many years.

Founded in 1984, the Egyptian Financial Group (EFG) was the first investment banking firm in Egypt and was, for many years, closely associated with the country’s government, creating and analysing privatisation plans. Nine years after EFG’s formation, in 1993, former Commercial International Bank executive, Yasser El-Mallawany,created Hermes and became general manager of the Corporate Banking division.

Initially, EFG and Hermes competed for the same custom, bringing securities brokerage to Egypt, based on their executives’ experiences on Wall Street in the United States. They followed up with corporate finance, sales and trading and asset management, taking lead roles in several Initial Public Offerings (IPOs) in the mid-1990s in Egypt, as the country’s markets liberalised.

By 1996, the logic of a merger became clear and the two companies formed EFG Hermes, helping them to offer a wider range of services and to expand to neighbouring markets.

A series of merger and acquisitions deals in the following years helped the company to grow quickly, assisted by the arrival of Hassan Heikal shortly before the merger of the two companies.

Heikal previously worked in the Corporate Finance Division of Goldman Sachs on Wall Street and has led EFG Hermes’s expansion into new markets. He won commissions from a wide range of multinational clients, including Vodafone, Heineken, PepsiCo, Pirelli and Bayer, as well as large Egyptian clients such as Orascom.

With its headquarters in Egypt and a presence in several North African countries, EFG Hermes certainly has the potential for further expansion in Africa and has the ambition to pursue this path. In 2011, it was named African Investment Bank of the Year at the annual African Banker awards held in Washington DC – the first Egyptian-based bank (and the first bank from an Arab country) to win the award.

The company has also played pivotal roles in large deals in Africa, including the $450 million acquisition by Japan Tobacco of Sudanese tobacco firm, Haggar, which controls 80 percent of the country’s cigarette market, and the $1.2-billion takeover by Qatar Telecom of North African telecoms company, Tunisiana.

In recent months, however, EFG’s regional aspirations in the Gulf have taken priority over its African plans. The battle between Planet IB and QInvest demonstrated the potentially rich rewards at stake for a company that can win the majority of investment banking in the Middle East, as the region diversifies away from purely hydrocarbon investment and attempts to make longer-term investment plans.

EFG Hermes is itself part-owned by the Dubai Investment Group (with an 18.5 percent stake) and the Abu Dhabi Financial Authority (9.8 percent), so it functions as a quasi-sovereign wealth fund. There are strong reasons for the Dubai and Abu Dhabi authorities to prefer a bidder from their own locality (Qatar), versus an Egyptian bid, which could lessen their influence, if not remove them altogether. (Planet IB does, in fact, have some Arab backing, including Sheikh Tariq bin Faisal al-Qassimi, a cousin of the ruler of Sharjah).

When it came to a vote, on 16 September 2012, the company’s shareholders decided, by an overwhelming majority of 86.9 percent, to approve the “strategic alliance” of QInvest. “This transaction will net Egypt $250 million in foreign investment while setting the Arab world’s leading investment bank on course to expand into Africa and Asia,” the company said.

A new legal entity – EFG Hermes Qatar – will be created, 60 percent owned by QInvest and 40 percent by EFG Hermes, offering a full range of investment banking services, securities brokerage, asset management, research and infrastructure funding activities.

Mona Zulficar, EFG Hermes chairperson, said that Shareholders have given resounding approval to the Board of Directors’ vision of creating the definitive investment bank in the Arab world, a platform from which EFG Hermes will grow to comprehensively cover the Middle East, Africa, Turkey, and south and southeast Asia.

Commentators have noted that EFG Hermes is in a tricky situation, with its net income (as of early 2012) only a fifth of its 2008 levels, and its share price down 60 percent since the start of the Egyptian uprising. “EFG Hermes investors have spotted a way out of their predicament,” the London Financial Times reported. “The bank’s model is right, the Qataris will help it to achieve its potential.”

Until the Egyptian political situation calms and investors can gain proper clarity about the future direction of the country and the legal security of their investments, EFG Hermes’ position is likely to remain precarious. But once stability returns, the prospects for the company in its own locality, in the Middle East, Africa and Asia, should brighten considerably.

The post EFG Hermes: Egyptian Bank Plans African Rollout appeared first on Ventures Africa | .

Bashir told Reuters that the deepened gold exploration would be done with the assistance of Chinese and Russian companies are interested in African business.

According to Reuters, gold has now become Sudan’s biggest foreign currency earner, partially replacing oil profits that had made up more than 50 percent of state income until almost 18 months ago when South Sudan became independent and took most oil reserves.

Sudan plans to supply around 50 tonnes of gold this year, possibly making it Africa’s third-largest gold miner after South Africa and Ghana. This would thrust Sudan into the top 15 gold producers internationally.

Reuters has reported industry players as saying Sudan is high on the list of exploration firms in Africa because much of the massive country has not yet been looked at.

US restrictions and Sudan’s many skirmishes have prevented many companies in the past from doing business in Sudan.

However, stakeholder curiosity about the country is now on the increase because of the high gold price.

The post Sudan To Increase Gold Production – President Omar al-Bashir appeared first on Ventures Africa | .

Spur Corporation operates brands such as Panarottis Pizza, Spur and John Dory’s. The expected surge in headline earnings per share is in line with other fast foods operators in South Africa who have generally reported significant increases in profitability and revenue generation.

The rise is also in line with chief executive Perre van Tonder’s earlier projections. He said in January that sales across its operations would increase by 17.5 percent during the same period under review.

Business Day reported at the time that that the surge in sales was underpinned by “quality, good value and innovative marketing,” according to the company’s chief executive.

“It is therefore particularly pleasing to report such strong growth across our brands in this challenging environment and to continue to attract increasing volumes of customers,” Tonder said on Tuesday.

The company is expecting profits before tax to come in at about 22 and 27 percent stronger while profits after tax are projected to be between 30 and 35 percent higher.

Results for the period will be announced on March 7 while the results projections lifted up the company’s stock 0.04 percent higher.

The post Restaurants To Lift SA Listed Spur Corp’s Earnings appeared first on Ventures Africa | .

This came after Harmony met the National Union of Mineworkers (NUM), the Association of Mineworkers and Construction Union (Amcu), Solidarity and Uasa on Tuesday.

“The mine remains closed until an agreement has been reached, and all the conditions of re-opening it have been agreed upon and committed to by all the unions and other stakeholders involved,” Harmony Gold CEO Graham Briggs told iAfrica.com.

They reportedly talked about the situation in terms of section 189 of the Labour Relations Act, which codifies the requirements for retrenchment.

Kusasalethu mine said the unions accepted its reasons for issuing the section 189 which could lead to the possible closure of the mine and retrenchment of all employees, according to iAfrica.com.

After safety and security concerns arose, Kusasalethu was closed on January 3rd, leaving about 500 miners without access to the hostel premises.

The company said though Harmony and the unions are to meet again next month, bilateral discussion between the parties would continue in the interim.

The company closed its operations at the end of December, but said it would continue to pay the basic salaries of workers.
The mine employs 5 193 workers and another 990 contractors and according to the company’s website about 5200 employees would be affected if the mine closed permanently.

The Kusasalethu mine where mined ore is treated, is on the border of the Gauteng and North West provinces. It comprises twin vertical and twin sub-vertical shaft systems.

The post Harmony Gold Mine To Remain Closed Until Further Notice appeared first on Ventures Africa | .

The development depressed share price as the stock lost more than 5 percent in early trade on the JSE to 13990 rands from 14840 rands.

Analysts said the market could have been caught by surprise as they thought the company was doing well in terms of sales despite an increase in competition in South Africa.

Throughout the country, townships – areas zoned for black people and meant to keep them poor by the apartheid system – have seen a boom in the renovation and building of houses.

“This lacklustre performance could mean that Cashbuild has to deal with tough competition. It is true that renovations and house constructions have surged in the townships. But why are Cashbuild’s revenues so low? Where are people from the townships buying their building materials?

In South Africa, competition for this company has emerged with the coming into the market of companies like Build It, Builders Warehouse and many others.

Cashbuild said transactions through the tills during the 2nd quarter and half year remained at similar levels to those of the comparative periods.

It said total units sold decreased by 5 percent, with existing stores’ units decreasing by 7 percent. Half year units sold decreased by 2 percent on prior half year, with existing stores’ units decreasing by 4 percent.

The company said operational profits during the period had declined from those reported in the second half of the prior financial year.
The company did not give reasons for the poor performance, saying it could not comment on these as it was in a closed period – a period when they are preparing results and are not allowed by law to discuss them.

Cashbuild is the largest retailer of building materials and associated products, selling directly to cash-paying customers through its 193 (and growing) stores in South Africa, Namibia, Lesotho, Botswana, Swaziland and Malawi. Cashbuild which employs in excess of 4 000 people, comprises Cashbuild Limited and the operating subsidiaries registered in countries where it retails.

The post Increased Competition Decreases Cashbuild’s Revenue appeared first on Ventures Africa | .

Reuters quotes Prime Minister Abdelillah Benkirane as saying: ”No one wants to reach a situation like in Greece… raising the retirement age is an obligation to avoid collapse.”

Moroccan retired workers have been waiting for a reform for years. But challenges to revamping the system abound.

The reform process has been long and tedious. A commission was set up nine years ago to draw up reform plans but no final solution was agreed on due to “the lack of political courage.”

The government will soon put in place an agreement with its social partners, Economy and Finance Minister Nizar Baraka said recently.

“We’re going to work with our social partners to ensure that the findings from the technical studies on the issue are implemented, particularly the introduction of a unified system and the creation of a second additional sector-based level,” he added.

According to Reuters, the deficit of the Moroccan Pension Fund (CMR) for public sector workers is currently on track to reach 1.28 billion dirhams ($151 million) in 2014, 24.85 billion dirhams in 2021 and 45.66 billion dirhams in 2030, Benkirane said.

In 2013, the CMR will start to dip into its reserves, and the reserves of all of Morocco’s pension funds will be drained by 2050 if there is no reform, the government’s High Planning Authority said in a report published last month.

The agency added that only 27 percent of Morocco’s economically active population was contributing to the pension system, against 80 percent in countries of the Organisation for Economic Co-operation and Development.

In addition to the CMR, the government operates a pension fund for private sector workers and one for workers on state contracts.

Benkirane, appointed prime minister after elections in late 2011, did not give any further details about the planned pension reforms.

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