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Burundi’s Poor Infrastructure Slowing Economic Growth

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President Evariste Ndayishimiye of Burundi has expressed concern that the lack of infrastructure and poorly developed human capital are slowing down economic growth of his country.

He made these remarks in a speech at the 58th edition of the African Caucus on August 04.

“The priority must be oriented towards the development of human capital,” said Ndayishimiye. According to him, young intellectuals and women still lack the capital to start their projects.

The Burundian leader also cited the lack of technicality in order to meet the needs of the labour market as another challenge to be taken up in order to boost the economy.

According to President Ndayishimiye, his government plans to reform the education sector to “make education more professional than general”.

He said this would also boost the already existing Youth Bank (BIJE), the women’s bank and the youth economic empowerment program.

In addition to human capital, the lack of infrastructure is also a challenge for the development of Burundi.

To resolve this problem, Ndayishimiye indicated that his government is planning, among other things, for the construction of a railway and a highway joining Bujumbura, and Gitega, the modernization of the port of Bujumbura and the extension of the Melchior Ndadaye international airport.

Despite the challenges of economic instability, President Ndayishimiye noted that Burundi has business opportunities.

“We have opportunities but we are missing the key to starting,” he said, adding that his government intends to install a nickel and iron refinery in Burundi.

Other opportunities, he adds, are agro-pastoral mechanization, industrialization, tourism, health care, ICT development and vocational education.

“We are doing our best to encourage the private sector and investors to come and invest here,”

He requested the World Bank to deploy more financial support for Burundi than that of previous years.

For Domitien Ndihokubwayo, Burundian Minister of Finance and Chairman of the African Caucus, African countries must make economic digitization a reality.

“It’s not just about writing and speaking. Africa must also act so that it does not always lag behind others, ” Ndihokubwayo noted.

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Rwanda Launches Campaign To Reactivate Tourism After COVID-19 Shocks

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Rwanda has launched a campaign to reactivate tourism after the sector suffered devastating effects as a result of the Covid-19 pandemic.

A tourism exhibition was lunched on Thursday evening in Kigali as part of a tourism week.

The tourism Week 2021 is an initiative that seeks to campaign for recoveries after the shocks incurred by the tourism sector.

Dubbed ‘Rwanda Tourism Week 2021 is the first tourism exhibition event organized by the tourism sector since 2020. The event has attracted participants from Ghana, Tanzania, Zimbabwe, Somalia, Kenya, DRC, South Africa and Botswana.

The sector managed to earn US$ 498 million in tourism revenues in 2019 but because of COVID-19 but because of COVID-19, the activities were affected according to Rwanda Development Board.

Zephanie Niyonkuru, the Deputy CEO of RDB, speaking at the event, said, Rwanda continues to provide the required support to the tourism industry to ensure that it continues to recover and attain pre-COVID-19 levels growth levels.

“The tourism sector has significantly suffered from the adverse effects of COVID-19 but the government has also made several interventions entailing to support the sector with dedications of 50% of the economic recovery fund to the hotels that helped them to restructure their loans,” he said.

Citing statistics, he said the tourism sector is a country’s primary contributor to Rwanda’s GDP adding that the sector’s contribution to the economy grew from 4.7% to 15% in the last 19 years (2000-2019), however, that pandemic affected the sector contribution with an economic contraction by 3.4%.

He further said intra-Africa travel is undoubtedly a key booster for tourism recovery on the Africa’s continent but only through tourism leader’s efforts

“The AfCTA, the outcome, the outcome of the African Union Heads of State Summit held in Kigali in 2016 and signed by African countries in 2018, is a valuable instrument to make intra-Africa tourism a reality.” he adds.

When COVID-19 hit in March 2020, Revenues from foreign visitors dropped 35% in the final first quarter compared to 2019. One of the reasons for this decrease in revenues is the international visitors who had stopped coming due to cancellation of meeting and tourists travels.

For instance, in 2020, RDB slashed gorilla permits from US$1,500 uniform price to US$200 for Rwandans and East African Community nationals residing in Rwanda and US$500 for foreign residents as part of promotional efforts to encourage domestic tourists after the decline of international travelers.

Regardless of local initiatives aimed to recover the sector, the region is also launching strategies to recover through events and marketing campaigns. On the same note, the East African Community (EAC) launched a new regional tourism media campaign in Arusha Tanzania as part of the plans to implement the six member’s blocs tourism plan.

The EAC’s branding campaign dubbed Tembea Nyumbai will start on December 1.

The East African Business Council indicates that the tourism sector contributes to the 10% GDP and accounts for 17% of export earnings and about 7 in terms of jobs.

Nonetheless, during COVID-19, 4.2 million foreign tourists were not able to travel to their preferred East African Community destinations.

Read RDB’s Report HERE

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Nigerian SME Funder, Sabi, Receives US$6M To Expand In Kenya

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Sabi, Africa’s leading B2B marketplace serving the informal sector, has received US$6 million bridge round led by CRE Venture Capital to support its continued fast-paced growth in Nigeria and beyond.

Sabi is platforming Nigeria’s $244 billion informal trade sector by providing the digital infrastructure to help SMEs grow their businesses. Over 175,000 merchants use Sabi’s category agnostic platform to manage their businesses and make B2B transactions. Merchants are transacting at over a US$100 million GMV annualized rate on Sabi’s platform.

The company has been operational in Nigeria for just over a year and recently became operational in Kenya.

Sabi’s network of over 10,000 agents now interacts with merchants across all 36 Nigerian states, delivering the online and offline support needed to properly service the over 41 million micro, small, and medium-sized enterprises in Nigeria alone that can benefit from the Sabi platform.

Sabi’s bridge round follows the company’s seed round closed in mid-2020 which also attracted leading international investors including Janngo Capital, Atlantica Ventures, and Waarde Capital. This bridge round financing will help fuel the company’s rapid growth as it eyes new markets including South Africa, which is also home to a multi-billion dollar informal sector.

Anu Adasolum, CEO of Sabi, commented, “we are excited to have closed this bridge round as Sabi continues to grow at an incredible pace. Our merchant users are taking advantage of every part of our platform, and the quality of the B2B partners we have brought onto the market is clear from the ever-increasing transaction volume.”

Pardon Makumbe, Co-founder & Managing Partner of CRE Venture Capital, added, “CRE Venture Capital is proud to support Sabi’s continued growth across Nigeria and expansion into Kenya and South Africa.

Sabi’s online/offline approach to serving informal businesses, combined with the quality of its platform and service provider curation, has clearly taken root in

 

Nigeria. The company is on track to be one of the fastest-growing African companies of 2021 and is showing no signs of slowing down.” Ademola Adesina, co-founder of Sabi, added, “now that Sabi is operational all across Nigeria, we look forward to bringing our solution into new markets with similar informal sector challenges, starting with Kenya and then South Africa. Sabi’s team, platform, and investors are ready to continue scaling Sabi into Africa’s leading B2B marketplace.”

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Ecobank Group Secures €100M Credit Facility From European Investment Bank To Fund SMEs

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Ecobank Group has signed an agreement for a €100 million long-term credit facility for over 9 years with the European Investment Bank (EIB). The facility affirms joint Ecobank Group and EIB targeted support for business investment across Africa, with particular support for the sectors most impacted by the COVID-19 pandemic.

Ade Ayeyemi, Chief Executive Officer, Ecobank Group, said the bank will provide a range of initiatives that will support the growth and success of Africa’s Small and Medium-sized Enterprises and create employment opportunities.

“This informed the credit facility that we have just secured from the EIB which we believe will deliver real impact in our joint mission to develop SMEs across Africa. The €100 million facility will support the recovery of African SMEs from the COVID-19 pandemic while also helping to provide them with the impetus to grasp the immense growth opportunities from the African Continental Free Trade Area vast single market. We thank the EIB for its focus and commitment to the continent,” he said.

Ambroise Fayolle, Vice-President, European Investment Bank, said the EIB, as part of Team Europe, works with leading banks and financial partners across Africa to enhance private sector access to finance.

He added that the latest cooperation with Ecobank Group will help companies to better tackle challenges triggered by the COVID-19 pandemic, unlock economic and social opportunities, especially for SMEs and women-owned and women-run enterprises, across Sub-Saharan Africa in the coming weeks.

The latest cooperation between Ecobank Group and the European Investment Bank to support private sector investment across Africa was formally agreed at the EU Delegation to Togo in Lomé, in the presence of Koen Doens, Director-General for International Cooperation and Development at the European Commission.

The announcement was made during a Team Europe visit to Togo by EIB Vice President Ambroise Fayolle, Rémy Rioux, Chief Executive Officer of the Agence Française de Développement and Koen Doens.

The facility is split into three regional facilities: West & Central Africa, Eastern Africa, and Southern Africa. Funding will be provided through Ecobank affiliates, for investment projects undertaken by private sector companies. The EIB made the facility available through its COVID-19 Rapid Response Facility, for private sector entities active in eligible productive sectors, with fewer than 3,000 employees.

The EIB loan will also be accompanied by technical assistance under the AWRI (African Women Rising Initiative) program of the EIB with gender finance focused training and capacity building for lending to women entrepreneurs, closely aligned with the Ellevate by Ecobank initiative which supports women-focused businesses across the continent.

Ecobank Group and EIB both recognise the importance of ensuring access to finance by female-owned and female-focused businesses, in particular during times of economic and investment uncertainty related to COVID-19. Ecobank Group and EIB are also working on a €15 million “SME Access to Finance” Risk Sharing Facility Agreement granted by the EU’s European Fund for Sustainable Development (EFSD), that will support loans to SMEs worth €95 million.

This facility agreement follows on from the EIB’s signing of a €12.5 million loan to Ecobank Malawi in December 2020, to improve access to finance for SMEs in Malawi’s agricultural sector to expand, upgrade and modernise their equipment.

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