President Robert Mugabe and his wife Grace wave the National Flag. Photo credit /alamy.com
Zimbabwean President Robert Mugabe is set to appoint a woman deputy after a special ruling party congress next month, the first lady said and added that there was nothing wrong if her husband appointed her Vice President.
The 93-year-old Mugabe has held power in the southern African nation since independence from Britain in 1980 and consistently refused to anoint a successor. He argues that the ruling ZANU-PF party would choose his replacement if and when he decides to retire.
Grace Mugabe told a ZANU-PF rally in the second city of Bulawayo that the party would amend its constitution this month and the changes would be adopted at a special December congress to ensure that one of Mugabe’s two deputies would be a woman.
Allowing Mugabe to appoint a woman deputy could scuttle the presidential ambitions of Vice President Emmerson Mnangagwa, who had been seen as a shoe-in to succeed Mugabe. Phelekezela Mphoko is the second Mugabe deputy, but lacks any political base.
Mnangagwa, nicknamed ‘Ngwena’ (Crocodile), has seen his political stock plummet in the last few months, on accusations by party rivals that he was plotting to get Mugabe to step down in his favour. He denies the accusation.
On Saturday Grace cranked up the pressure against Mnangagwa, calling him the “root cause of factionalism” that was gnawing at the ruling party. She also accused the vice president’s supporters of booing her while she gave her speech.
“Before that special congress, this November we need the constitution to be changed accordingly so that when we are going we will adopt the proposal that one of the vice presidents should be a woman,” Grace said in a speech broadcast on state TV.
“What if I get in (as vice president)? What’s wrong with that? Am I not in the party? If people know that I work hard and they want to work with me what is wrong with that?” Grace said.
A visibly angry Mugabe told the same rally that he and his wife were tired of constant insults from people who identified themselves as Mnangagwa’s supporters.
The National Resistance Movement (NRM) has started ‘consultative meetings’ across the country on the Age Limit Bill that seeks to remove the 75-year age cap on presidency.
Rodgers Mulindwa, the party spokesperson, said in a statement that senior party leaders will start meetings in different parts of the country today.
“The National Party Chairperson Gen. Yoweri Kaguta Museveni has already deployed his senior cadres to take lead in the exercise that will last not more than seven working days,” the statement reads.
Below is the list of the party officials and the regions they will consult.
Greater Masaka: Al-Hajji Moses Kigongo.
Acholi: Hon. Richard Todwong.
Kampala: Hon. Rose Namayanja, Mr. Godfrey Nyakana and Dr. Hassan Galiwango.
Greater Luwero and Mukono: Hajji Abdul Nadduli.
Greater Mubende: Hon Ruth Nankabirwa.
Greater Mpigi: Hon Mathias Kasamba.
West Nile: Hon Hudu Oleru and Hajji Nasur Gaddafi.
Lango: Hon Sam Engola and Hon Lydia Wanyoto.
Karamoja: Hon Simon Peter Aleper and Mr. Gabriel Kato.
Busoga: Hon. Ali Kirunda Kivejinja and Hon Milton Muwuma.
Bukedi: Hon. Mike Mukula.
Sebei and Elgon: Hon Dominic Gidudu.
Teso: Dr. Kenneth Omona.
Bunyoro: Hon Kahinda Otafire and Mr. Oscar Kihika.
Rwenzori: Hon Matayo Kyaligonza and Dr. Robert Rukaari.
Ankoke: Hon Maj. Gen. Jim Muhwezi and Mr. James Tweheyo.
Former Democratic Party (DP) Member of Parliament Issa Kikungwe is dead.
According to close family sources, Kikungwe, who represented Makindye Sabagabo in the Ninth Parliament and was also a Kampala city mayoral aspirant in the 2016 elections, passed on this morning at Mengo Hospital, where he has been undergoing treatment after suffering a brain clot.
The friends said Kikungwe was operated upon in India, and was set to return to the Asian country for a second operation early next year.
The National Social Security Fund (NSSF) Managing Director Richard Byarugaba is serving his third term, the longest-serving MD in the history of the once-troubled organization.
However, since assuming leadership, Mr. Byarugaba has transformed the Fund into a user-friendly entity, with members now able to enjoy a raft of benefits as they gravitate towards retirement, or even while in retirement.
Below are some of the initiatives taken by the current management to turn around the Fund, giving hope to the members.
The NSSF Strategic Plan 2015-2025: The foundation of steady progress
Two years ago, Mr. Byarugaba presented a ten-year strategic plan to members as a foundation for the Fund’s development, concluding in 2025.
According to Mr Byarugaba, the strategic plan aims at giving the Fund’s members a better life, and the plan is delivering on the promise.
The strategy is service focused, people-centred, technology-based to grow the fund and is to help NSSF become the social security provider of choice in the Ugandan pension sector. It calls for member participation more so through compliance through the remission of monthly contributions.
Following the tenets of the strategy, NSSF administrators want to provide members with customer experience; not just the best but legendary and gone are the days when members had to struggle to get information regarding their savings. Today, the members are updated on all transactions.
This strategy, Mr Byarugaba says, was informed by a survey carried out to establish members’ concerns which include safety of savings, accessible and timely service and relevance in the entire life cycle.
Through the strategy, the NSSF promises to give real rate of return to members and ensure that they get access to several service channels including e-portals and alerts.
Relationship management is part of what the managers at NSSF are doing, which they say is good for growth.
“Value-adding products catering for the social security needs are being provided such as short term loans for housing, education, health and business,” a senior official at the Fund told EagleOnline.
According to the official, the strategy to deliver customer experience is being built on NSSF’s strong financial base, excellence in business processes, as well as a delightful place ‘to work all the time and every time’.
“To build a strong financial base and grow the fund, managers will continue to improve compliance levels, diversify investment portfolio and roll out new voluntary saving products such as the voluntary savings scheme,” he added.
The Fund’s investment portfolio is in three major asset classes; Fixed Income, Equity and Real Estate, and as a way of diversification the NSSF has started on the development of its real estate projects, investment in securities. The recent commissioning of the US$400 million Lubowa Housing Project is a just one of them.
Construction works at the Pension Tower
Other real estate investments include the Shs15.5 billion Mbuya Housing Project, the Shs3.3 billion Jinja Commercial Complex, the upcoming Mbarara Commercial Complex and the Pension Towers. In line are ‘off-taker’ projects in Kasangati, Ssonde and Garuga. All these are part of the strategy.
The Shs3.3 billion Jinja Commercial Complex
Further, NSSF, as way of diversification, has appetite for investment in infrastructure projects, private equity funds, corporate bonds and asset-backed securities.
With a strong financial base NSSF managements hopes to grow total fund to Shs 20 trillion by 2025 and keep administration costs below 1% of Assets.
Currently NSSF has assets worth fund is at Shs7.924 trillion, and managers also are to develop products for a life partners of the Fund including long term health facilitation in retirement.
The Fund also wants to give medium term health, education and housing benefits. In the short term, members are expected to get loans for housing, education and health needs.
And by 2025, the target is to process age benefit payment within two days.
“There are no traffic jams along the extra mile; we will go the extra mile for our customers,” Mr Byarugaba says.
According to Mr. Byarugaba, to make the NSSF a delightful place to work, management wants to improve staff competence to 85%, with professional certification, enhance performance culture and align it with reward to performance. The management of the Fund also wants create a ‘talent pool’ and think tank.
“The objectives are to have a motivated staff with an engagement index of more than 90%,” Byarugaba says.
Byarugaba believes that a motivated and engaged workforce, supported by excellent processes and a strong financial base that delivers superior results, will all work together to give members a reason to choose to stay with the Fund.
The NSSF Board Chairman Patrick Kaberenge said that the Fund is steadily progressing towards achieving a total Fund value of Shs20 trillion in 2025 because of an effective corporate governance framework that is delivering tangible benefits to the Fund, as well as a strong leadership team.
Indeed, many members believe the re-appointment of Mr Byarugaba as MD for the next five years is good for the strategy to achieve its objectives as he is the one who launched it.
Further, they say that with the help of his new deputy Patrick Ayota and Corporation Secretary Richard Wejuli Wabwire, Mr. Byarugaba’s dream of positioning NSSF as the region’s number one pension Fund surely can be achieved.
The inaugural NSSF Annual Members Meeting: Rejuvenating the Fund
The first ever NSSF Annual Members Meeting was held on March 19, 2013, less than three years after the current Managing Director Richard Byarugaba assumed office.
The NSSF Annual Members Meeting is about members. It is a gathering where NSSF managers listen to members voices.
The introduction of the Annual Members Meeting was welcomed by members who for long had been kept in the darkness when it came to the Fund’s activities. Indeed, for the members the annual meeting is transparency at work.
This is because the board and management use the occasion to explain the performance of the Fund in terms of annual financial statements, investments, expenditures and how they arrive at the interest rates paid to members.
NSSF Voluntary Membership Plan: Attracting more savers
In June this year, NSSF has launched a Voluntary Membership Plan that will provide employers and workers that are not compelled by the mandatory provisions of the NSSF Act the opportunity to voluntarily save for their retirement. The Fund also introduced a mobile money platform through which it will receive voluntary savings through its code *254#.
According to Mr. Byarugaba, the Fund is responding to the need for a voluntary savings option by many Ugandans as well as enhancing the Fund’s growth strategy in terms of membership and contributions.
“The Plan will enable us recruit and register two types of voluntary members – Voluntary Employers – Under NSSF (Voluntary Registration and Contributions) Regulations, and Individual Voluntary Contributors with specific reference to Sections 10 (1) and 10 (3) of the NSSF Act respectively,” he said about the new initiative.
Under its provisions, NSSF will recruit and register employers with less than 5 employees as well as accept contributions from former NSSF members who were paid their respective benefits, but are still able and willing to save with the Fund.
According to Mr. Byarugaba, there is a potential customer base of close to two million workers who do not have any form of social security cover out of about four million Ugandans working in the formal sector. The former group needs to be tapped into, he says.
“We have been piloting this plan in the market and it has been well received. As at end of May 2017, we had recruited 3,017 voluntary employers, and have collected over Ugx 2.6 billion,” he says.
“In addition, we recently carried out a survey and about 19% of workers in the formal sector who do not have social security cover told us they would start saving as soon as the Fund started a Voluntary Membership Plan, which is about 836,000 people. There is also an additional 700,000 former members of the Fund whose accounts are currently inactive mainly because their employers no longer remit contributions, or are now self-employed. They would like to continue save with us,” Mr. Byarugaba added.
In addition to receiving contributions, the Fund is also set to start paying its members who qualify for their benefits through mobile money via its existing NSSFGO code *254# accessible to the MTN and Airtel subscribers.
And Byarugaba said that mobile money is a channel the Fund must embrace not only for the convenience of contributors and beneficiaries but also because it offers a number of other advantages.
Membership growth: The strength of numbers
The Fund has registered consistent membership growth over the last six years; last financial year over 106,000 new members and over 2,800 employers were registered. The Voluntary Savings Plan is expected to accelerate this growth in the medium and long terms, Mr Byarugaba notes.
Meanwhile, statistics indicate the number of new employees registering with the Fund has increased from 106,434 in the 2014/15 to 119,571 in the last financial year. The number of new employers registering their workers with the NSSF grew by 2,887 in the 2015/16 financial year.
NSSF Torch Awards: Rewarding innovation and selflessness
In line with its Corporate Social Responsibility (CSR) agenda, in 2012, NSSF launched Torch Awards, an initiative through which the Fund recognises and supports projects run by institutions or individuals that have transformed communities and made a difference through those projects.
In order to ensure transparency, the NSSF places adverts in the media calling for submissions of project proposals from institutions or individuals that have changed lives of the community targeting; Youth, Education, Health and the Disadvantaged.
“To date, eight projects that have gone on to impact communities have been recognised and given financial support totalling to Shs150m since Torch Awards were launched in 2012. Projects that have benefited from this initiative include 40 Days Over 40 Smiles Foundation (40-40), Childcare and Rescue Home, Youth and Women Empowerment Foundation, among others,” Mr. Byarugaba says.
NSSF ‘Friends with Benefits’ Financial Literacy Campaign: Giving hope to members
Last year the National Social Security Fund (NSSF) launched a savings and financial literacy campaign dubbed ‘Friends with Benefits’ aimed at educating its members and the general public about a savings culture and better usage of benefits.
The campaign runs as a TV show programme profiling retired workers who invested or used their NSSF benefits to transform their lives, and those of the communities around them.
While addressing journalists at the launch of the campaign at Workers House, the Managing Director said: The campaign aims at showcasing inspiration success stories from members who have received and used their benefits to change their lives, those of their families and even the communities they live in so as to motivate existing and potential members to invest in retirement savings.”
At the same function Barbra Arimi, the NSSF Head of Marketing and Communications said Friends with Benefit will inspire so many Ugandans.
“Our objective is to inspire both our existing and potential members, especially the younger generation to save for their retirement. As was the case in the first season, we shall showcase stories of willing NSSF beneficiaries to demonstrate various projects one can undertake to improve their lives using their NSSF benefits,” Ms. Arimi said.
And this was proved; following the inaugural campaign held last year, the Fund registered a significant increment in its Voluntary saving plan with over 400 people joining the plan and shs670, 000,000 collected between the months of September and December when the TV show aired.
As part of the campaign, participants are required to submit a short and compelling story, stating how they utilized their NSSF savings and transformed their lives.
A case in point is that of Harriet Balyama, who applied for her benefits when she discovered she had a brain tumor. She used her savings for treatment and the balance to complete her housing project. She was one of the over 500 applicants and emerged winner of the campaign, walking away with shs30m which she used to complete construction of rental units. She says poverty now lives in the past!
The Friends with Benefits second season will run for a period of 6 months, and started with the call for submissions on October 4.
In January, National NSSF unveiled a web-based whistleblower platform for aggrieved employees to report employers who fail to remit their contributions to the Fund, as required by the law.
Announcing the platform at the time, Mr. Byarugaba said that over 25,000 employers were meant to pay NSSF contributions, but 12,000 of those are not complying and of the 13,000 who are complying only 8,900 are consistently remitting NSSF contributions for their employees.
“These figures show that a significant number of workers are being cheated out of their benefits by their employers,” Mr. Byarugaba noted, adding that the whistleblower platform would help bring more contributors on board.
“It is illegal for an employer to withhold their employees’ social security contributions. The campaign is aimed at empowering employees to be vigilant and speak out to ensure that their employers remit their savings to the Fund. We do believe that when employers are compliant, workers will have an opportunity to save for their retirement,” Mr. Byarugaba said.
He noted that anonymity of the whistleblower is the main aspect of the platform, put into consideration during the design stage.
“The safety of any whistleblower is of utmost importance, we have taken all the necessary steps to ensure that the identity of whoever reports cases of non-compliance is not revealed to the public, in line with the Whistleblowers Act,” Mr. Byarugaba said.
Communication channels: Embracing emerging trends
Through different channels like Website, SMS, Kiosks, emails and NSSF app, members can check their statements and find out if their money is being remitted on a monthly basis and in the right amount. In order to report an employer who is not remitting contributions, an employee can log onto www.nssfug.org or call 0417331557/07.
Last month Uganda celebrated 55 years of Independence in a colorful ceremony held in Bushenyi District in the western part of the country, as they looked back to the year 1962 when the national flag in red, yellow and black stripes was hoisted and the British blue-white- red Union Jack lowered to make a political statement that Ugandans were finally free to govern themselves.
Over the last five decades and even before, the one other thing Ugandans have known and celebrated is the Sadolin paint brand, a proven household name in Uganda. In fact many a Ugandan say Sadolin Paint has never disappointed and they believe that the brand is the number one paint in the country and will continue to be for generations.
Ugandans say the Sadolin Paints brand, despite the economic instability and political upheavals the country has gone through, has found itself in all spheres of Uganda’s life history: used by government departments; the real estate and construction sector; educational, religious and financial institutions; hospitals, industries, markets, non-government organisations, homes and even used at the sendoff of loved ones, at the graveyards.
Further, Sadolin Paint has a presence in almost all towns and village hardware shops, and this is evidenced by the used up tins you find everywhere in the country, some used as water cans by households. It is a testimony of the wide network the Sadolin company has created over the decades.
According to company officials, over the years the Sadolin Paints brand has made its name through technological innovations and it will be hard for any new brand to come and expunge it from the Ugandan market. It is the market leader, respected and used by Ugandans from all walks of life.
“Sadolin is a market leader here in Uganda and maybe in the region. Others will just have to follow,” says a top tax revenue officer when asked about paint companies that pay most taxes. “I think that the good quality of Sadolin Paint attracts more clients to it,” the ‘taxman’ added.
But why do people love Sadolin brand? A simple quality research shows Sadolin paint is liked because of its good qualities and easy application, withstanding the adverse environmental conditions for long and forms a thin film of uniform nature when applied.
Sadolin Paints brand, according to those who have used it, is decorative and resistant against chemicals. “I have used Sadolin Paint on the number of projects and I can tell it is good and makes an artist like me or any other person love his work,” says Moses Kamoga, an artist who works with one of the big construction companies in Uganda.
Another painter adds that: “I have worked with Roko Construction Company since 1992. I can tell you that Sadolin paint is the best that I have ever used. The new technology they use to produce the paint is superb. The experience I have with Sadolin is that it is water resistant, easy to remove, environmentally friendly, does not allow moulds and algae to grow on it. It is also relatively cheap,” he says.
Unlike other companies in Uganda, Sadolin has a rich history that started when Gunnar Sadolin founded Sadolin Farver in 1907- a concern focused on artist’s paintings and inks. This shows how far Sadolin Paints has come and therefore worth the praise of its users spread worldwide and particularly here in East Africa.
Paying taxes
The ranking of the top 100 taxpayers released in February 2016, shows that Sadolin Paints paid Shs11,132,609,038 in taxes in 2014, an indicator that the company has over the years been key in the development Uganda.
Corporate Social Responsibility (CSR)
Ugandans appreciate Sadolin Paints for being involved in community activities and the company has partnered with a number of non-governmental organisations to refurbish schools and health centres in several parts of Uganda. Indeed, Sadolin Paints is aware of global CSR requirements and its responsibility towards employees and society.
Awards
Sadolin Paints has received many awards but among the major ones, was when it emerged among the top manufacturers in the region that performed well in reducing their contribution to environmental pollution in Uganda. The company recycles and re-uses wastewater to wash the vessels. This means less water is used from the main water supply and there is close to zero discharge of untreated wastewater into the environment.
Sports
Who in sports doesn’t know the Sadolin Football Club? The club is sponsored by Sadolin Paints and has participated in the Uganda football league. Sadolin Paints knows that Ugandans enjoy football. “Football is happiness to us and we thank Sadolin for what they have done for this club,” says a fan of the Club, Ahamed Kizito.
Employment
There is no doubt that Sadolin Paints has provided both direct and indirect jobs to Ugandans for all the decades it has been in Uganda and continues to do so. It has provided both professional and causal jobs, thus catering for all classes of Ugandans.
The future is bright
The proposed installation of the over Shs10 billion manufacturing plant is expected to provide more jobs and help stimulate Uganda’s economy.
Felix Aduba, the Public Relations Officer for Sadolin says the brand is here to stay. “Those wishing for its closure can go and hang,” he says.
For now, despite some challenges it has faced in the recent past, Sadolin Paints remains the market leader in Uganda, says Mr. Aduba.
Coca-cola Beverage Africa (CCBA) staff pose with the boxers and ushers during the launch of a new brand Power Play energy drink at the company head offices in Namanve.
Coca Cola Beverages Africa (CCBA) Uganda has today launched another exciting global brand in its energy drink category – the Power Play Energy drink that company officials say will take the market by storm.
Speaking at the launching the brand today, CCBA Managing Director Conrad Van Niekerk said: “We are proud to introduce a high quality and trustworthy global energy drink into Uganda. With the current trend of busier schedules and more complicated lifestyles, people need an energy boost on a daily basis and this product provides the perfect offering. Power play celebrates the Ugandan culture of ‘Work hard, Play hard'”.
Launched under the tagline “Charginga Ne Power Play”, the brand is anchored on the need for a quick and effective energy boost.
“Whether it is long hours at work, the hustle on the street, dodging traffic on Boda Boda, studying through the night, dancing and celebrating culture, Power Play is an appropriately refreshing drink,” Van Niekerk said, adding that the brand will blend well with extreme sport enthusiasts, and will be a good blend for ‘people excited by speed, high energy, flash and instant thrill’.
The Power Play launch at CCBA Head Offices in Namanve was marked with excitement with a cocktail of parade of activities involving baggies, bikers, dancers and comedians, with Patrick Oyuru, the CCBA Commercial Director, saying the drink is designed to give consumers the best value for money per volume consumed.
“At only Shs2, 000 for a 400ml pack, consumers will be guaranteed a uniquely delicious flavor. With its communal, expressive, creative and uplifting style, Power Play Energy Drink will energize, refresh, and stimulate you instantly,” Mr. Oyuru said.
Derrick Mutumba, a Boda Boda rider at Oilcom stage in Namanve had this to say after tasting the brand: ‘Ate kano Coke kereese kakabi’.
Derrick Mutumba, a Boda Boda rider at Oilcom stage in Namanve had this to say after tasting the brand: “Ate kano Coke kereese kakabi, energy drink mungi ate akawowo kakabi mwana, namaanyi otandikirawo! Kyakabi” translated as “This is a superb energy drink with a great taste! The energy derived from the drink is instant!”
Power Play is now available at all official Coca-Cola Distributors across the country.
UCC ED Godfrey Mutabazi regulates communications sector
The Executive Director of Uganda Communication Commission (UCC) Eng. Godfrey Mutabazi has said media and telecommunication companies have registered reduced earnings in newspaper sales and voice calls respectively, due to the emergence of social media platforms like WhatsApp and Facebook.
Speaking at the release of a quarterly UCC Industrial Report at the regulatory agency headquarters in Bugolobi, Eng. Mutabazi also said sales of major newspapers have dropped due to instant access of news from different broadcasting websites via internet.
“Due to internet trends, traditional media are craving to form online websites to cop up with the current broadcasting mechanisms,” Eng. Mutabazi said, adding that online broadcasting has outplayed traditional media in terms of business.
He added: “The country has a lot of good network and telecom service providers are compelled to lower subscription costs and this has eased accessibility of internet.”
The report indicates that internet subscribers increased by 3.7% from 16,484,312 to 17,102,456 between April and June 2017 as the internet penetration increased from 43.8% to 45.4% indicating a 1.6% increase.
‘Following the growth outlook of the telecom sector that has seen every gadget being driven by data, the report indicates that Broadband Internet is increasingly being accessed, thus leading to growth of broadband in the country’, the report states in part.
Chris Bwakira, Vice President and Area Business Head, East Africa at Mastercard with Jacqueline Muna Musiitwa, Executive Director at FSD Uganda
Over half of Uganda’s adults are forced to keep their savings at home because of a lack of access to formal financial services, in the process slowing the country’s growth as large numbers of citizens remain in exclusion.
To reverse this trend, Mastercard and Financial Sector Deepening Uganda (FDSU) have partnered to develop financial solutions that will improve the livelihoods of Ugandans and also strengthen the country’s economy.
The partnership, announced during Financial Inclusion Week, will allow Mastercard, including the Mastercard Labs for Financial Inclusion, and FSDU to focus on the key sectors like education, agriculture, trade and health by creating and rolling out secure and simple digital payment solutions.
“Digital payments have played an important role in connecting Ugandans to financial services securely and seamlessly: 53 out of every 100 Ugandan adults have transacted because of mobile money solutions2, for instance, which shows us that the ability to include people in the economy is driven by innovative digital solutions,” said Chris Bwakira, Vice President and Area Business Head, East Africa at Mastercard.
According to Mr. Bwakira, Ugandans have also indicated a healthy appetite for digitalized consumption, mobile in particular.
“Mobile penetration sits at 65 percent and continues to grow rapidly, illustrating that as businesses, we should be targeting solutions that are convenient for citizens and that are easily accessible and available on platforms that they have adopted and use regularly,” Mr. Bwakira said.
According to Mr. Bwakira, Mastercard Labs for Financial Inclusion is working on an education payment project in Uganda, to be followed by an agricultural payments project next year.
Solutions developed by Mastercard and FSD Uganda will seek to close gaps and build on the education pilot, eventually linking to other initiatives in trade and health, which are also core sectors.
Approximately 60 percent of Uganda’s citizens are involved in agriculture, making pioneering tools and solutions in these areas a driver of growth.
The two partners have also committed to focus on meeting objectives in specific areas, most notably in protecting consumers, driving engagement with government surrounding policy, as well as carrying out research and partnering with other critical stakeholders to share knowledge and expertise around financial inclusion.
Other areas of interest include customer education and awareness building aimed primarily at people who have been traditionally excluded from banking and financial services, engagement with the Ugandan government around policies creating a more enabling environment for investment in financial services and information technology.
“Uganda takes building a more inclusive economy extremely seriously, as evidenced in the recently launched National Financial Inclusion Strategy 2017-2022.
Strategic partnerships between organizations with the same values such as FSD Uganda and Mastercard, are an important step on the journey towards creating a country where financial services are accessible, affordable and beneficial to all,” said Jacqueline Muna Musiitwa, Executive Director at FSD Uganda.
Bwakira agreed, adding that a greater roll out and uptake of digital payment solutions will feed into Uganda’s overall National Financial Inclusion Strategy, which runs until 2022 and aims to increase access to formal financial services.
“Addressing the challenges that face ordinary Ugandans, particularly rural and low-income citizens, cannot be solved overnight, but with continued partnerships and the introduction of tools and services that allow more people to access formal financial services, we are making definitive strides in the right direction,” he noted.
Prime Minister Ruhakana Rugunda will mid next week launch the construction of the long-awaited Shs5 billion National ICT Innovation Hub at the Institute of Institute of Information and Communication Technology, Nakawa.
According to a brief, the ground-breaking ceremony for construction of the ICT hub is expected to attract cabinet ministers, officials from telecom companies and leading stakeholders in the ICT sector.
The Government set aside Shs75 billion to support ICT innovators in the country under a five-year National ICT Initiatives Support Programme in the country, with Shs15bn will be available every year.
Mid this year the minister of finance Matia Kasaija provided Shs10 billion to innovators, the brief issued today indicates.
Africa has to deal with the fact that its oil and gas industry continues to face market challenges arising from the low oil price, competition for revenue growth and local talent together with new expectations from investors and regulators.
“Africa’s oil & gas industry is experiencing significant change and upheaval. There are fundamental shifts in companies’ strategies, business models and ways of working,” says Chris Bredenhann, PwC Africa oil and gas advisory leader.
The sustained lower price of oil has been accepted as the new normal in the oil & gas industry with companies putting plans in place to enable a more agile response to commodity price fluctuations in the future. For some, this means a diversification of portfolio, with many considering moves to an energy mix that includes some form of renewables. Despite the challenges, there are a number of opportunities on the African continent.
“The time is opportune for oil & gas companies to take up and utilise advances in technology as an enabler in meeting some of the challenges faced. Instead of playing catch up the rest of the world, we believe that the industry should be ‘learning to leapfrog’ so that they are not only ahead of disruption – they actually cause it,” Bredenhann says.
PwC’s Africa oil and gas review, 2017 analyses what has happened in the last 12 months in the oil & gas industry within the major and emerging markets.
As at the end of 2016, Africa is reported to have had proven natural gas reserves of 503.3 Tcf, up 1% in total gas reserves on the continent. About 90% of African gas production continues to come from Algeria, Nigeria, Egypt and Libya though the overall quantity produced in 2016 reduced by 1.1% down to 208.3 Bcm.
Africa’ share of global oil production has continued its downward trend from the past four years, dropping sharply, moving it down from 9.1% of global output last year to 8.6%.
The challenges in Africa’s oil and gas industry. The top challenges in the oil & gas industry have remained similar to those in previous years with uncertain regulatory frameworks, corruption, and tax requirements remaining in the top six for the past four years. It is notable that financing costs and foreign currency volatility have both become more critical challenges since 2015 when they were ranked eleventh and tenth, respectively.
“It is disheartening that governments are not catching up to demands and calls from oil & gas companies to ensure regulatory certainty to players who are looking to invest in hydrocarbon plays in various African countries,” Bredenhann comments. Upstream regulation in South Africa remains uncertain, with the separation of oil & gas from mining still not achieved in the Mineral and Petroleum Resources Development Act (MPRDA). Other key markets in Africa, such as Nigeria and Tanzania, are also experiencing significant regulatory issues.
Corruption has remained among the top three challenges over the last four years, with numerous instances occurring across the continent. Despite the existence of anti-corruption programmes at government and corporate levels, the effectiveness of such programmes is questionable. In the context of corruption issues, it is not surprising that the costs of finance have risen to third among major challenges for African players. It is likely that the regional issues and uncertainties combined with a constrained wider industry, have led banks and other institutions to be wary of offering favourable financing terms.
The lack of skills development continues to be a problem in Africa, and it is becoming a global challenge in the oil & gas industry overall.
Lower oil prices
Aside from those challenges highlighted by companies, adjusting to the new normal of lower oil prices remains a concern for companies. The oil price has been relatively ‘stable’ through 2017. Having recovered since the January 2016 low, it has typically been trading in the $50-60/bbl range. As the Brent oil price reached close to $60/bbl in September 2017, the market began asking whether ‘lower for longer’ may be over. The demand for oil is picking up, and supply is easing off, suggesting a market rebalancing is underway. However, as we have often seen with global oil prices, nothing is ever certain.
Oil & gas companies cited geopolitics, supply and demand as the three major reasons for the current oil price environment. Looking ahead, respondents expect modest increases in prices over the next two years – with 65% and 52% expecting the price to be in the $51-60/bbl range for 2018 and 2019 respectively.
The changing competitive landscape. In response to many of these challenges, oil & gas companies are looking to alter their strategies and operating models, which has changed the competitive landscape. Companies reported that major changes anticipated or recently experienced in the competitive environment are driven by the growth in alternative fuels, the impact of technology-driven disruption and the need for cost reduction.
Oil and gas companies and growth. Oil and gas companies cited ‘too little investment in developing capabilities’ as the most significant impediment to business growth. This was followed by weak strategy and leadership.
According to PwC research, companies become ‘Fit for Growth’ by doing three things consistently and continuously: they focus on a few differentiating capabilities; they align their cost structure to these capabilities; and they organise their businesses for growth.
According to PwC’s Oil & Gas Review, 75% of companies say that they have reviewed their Africa strategy in the last three years, but they also acknowledge that there are issues with incoherence and a problem with executing it in day-to-day business.
PwC’s Fit for Growth approach emphasises that investment in capabilities that enable the organisation to create unique value for customers is key for sustainable growth.
Survey respondents indicated that they are investing in the development of new or the enhancement of existing capabilities (18%), local content and skills development (14%), infrastructure improvements (13%), and regulatory compliance (12%) over the next three years.
It is notable that cost management as a strategic focus has fallen in importance this year. One-third of respondents indicated that they had no cost-cutting intentions. Just under half of respondents intend to reduce costs by up to 20%.
Achieving sustainability
The need to strategically assess the portfolio of activities oil & gas companies in Africa pursue in order to be sustainable in the drive towards a low-carbon environment is necessary. The review results indicate that M&A and partnerships are key to delivering the intended and repositioned strategies and growth. The minority of respondents were related to an M&A proposition to drive growth, with approximately 30% of respondents being targeted for acquisition and about 40% having targeted an entity themselves. The majority of respondents referred to a partnership proposition with nearly 60% having both been approached or approaching another entity for partnership.
While some oil and gas companies continue to explore opportunities for cost reduction and improved efficiency, consideration is now being given to how they will stay ahead of the competition. Given the perception of slow uptake of digital solutions in the oil & gas industry, it is surprising that nearly a quarter of companies stated that they had implemented some form of digital solution, from production and drilling to mobile solutions.
Leveraging local content
More than 25% of oil and gas companies said that projects had been postponed or delayed by local content policies, and about 15% have relocated or cancelled projects in response to local regulations. About 10% indicated an acceleration of their projects. One-third of respondents think that there are more local companies today that can serve the sector. Just under one-third acknowledge that local skills at the right level are available in their country and 11% said that new players have emerged in upstream as a result of the regulations.
“The oil & gas industry in Africa is riddled with complex challenges and adversity, but with challenge comes opportunity. The opportunity is there for players who are willing to ‘reimagine the possible’ in a future that looks very different to our present.
“It is clear that African oil players must ‘learn to leapfrog’ to remain competitive in the new energy future,” concludes Bredenhann.
