What to expect from Nigeria’s new ‘Committee on Fiscal Policy and Tax Reforms’
By asking Oyedele to lead the group that will likely have the most direct influence on federal taxation policy, Tinubu is signalling a willingness to listen to tax policy experts. Having expert advice on the menu is always good, but it does not guarantee that the government will act on recommended policies. Per local media reports, president Tinubu has appointed Taiwo Oyedele, PwC’s Fiscal Policy Partner and Africa Tax Leader to oversee a newly established presidential tax reform group. This is the latest signal of Tinubu’s fiscal policy direction following a series of recently announced tax policies. Taiwo Oyedele, an associate professor at Babcock University, a private university in southwestern Nigeria also leads PricewaterhouseCoopers’ tax business in Africa. His appointment came on the back of new tax programs including a planned expansion of value-added tax to street traders and informal businesses. Nigeria’s government is seeking to increase the revenue it collects from taxes to contain a deficit budget, beef up declining oil earnings and manage staggering debt that is at historic highs. By December 31 2022, public debt levels stood at $103 billion, according to Nigeria’s debt management office. Despite its reputation as an oil-producing country and decades of oil receipts, the country struggles to finance its budget. Between 1981 and 2022, Nigeria only recorded budget surpluses in 1995 and 1996. During his campaign, Tinubu frequently pointed to the rapid increase of state revenue during his 8-year stint as governor (between 1999 and 2007) as evidence of his plans to boost government revenues. As a first step in that direction, Nigeria announced a new annual vehicle ownership verification program. Under the program, car owners would pay N1000 ($1.3) per vehicle yearly, to obtain confirmation that they owned their vehicles. This was quickly followed by an expanded VAT collection plan announced earlier this week. Nigeria’s Federal Inland Revenue Service (FIRS) said it would work with the Market Traders Association of Nigeria to collect VAT from informal traders using “unified systems technology.” The tax plan generated muted uproar on social media networks and Nigerian media publications. The announcement came weeks after the government removed petrol subsidies and floated the naira. Oyedele roundly condemned the vehicle verification program, writing on LinkedIn and Twitter, “This tax is retrogressive. It is ill-conceived and poorly designed. Apart from the payment which seems to be solely for revenue generation, and perhaps more for non-state actors than for the government, it is illogical to have to prove annually that you own a vehicle for which you already have a certificate of proof of ownership issued by the government.” Oyedele however, expressed support for the VAT expansion program while cautioning that it needed “safeguards to prevent abuse.” The government followed that up with four executive orders that rescheduled the start date for new tax programs while suspending the collection of new taxes on telecom services, Single Use Plastics, tobacco, alcoholic beverages and some imports. On social media, Oyedele praised the executive orders By asking Oyedele to lead the group that will likely have the most direct influence on federal taxation policy, Tinubu is signalling a willingness to listen to tax policy experts. Having expert advice on the menu is always good, but it does not guarantee that the government will act on recommended policies. This is not Oyedele’s first public service rodeo. Since 2017, Oyedele served as a member of Nigeria’s National Tax Policy Implementation Committee under immediate past president Muhammadu Buhari. He continued in the same role under Tinubu until the recent announcement. Why is this all important? Nigeria like several African countries has been under scrutiny for debt distress following Sri Lank’s default and the dramatic political fallout. Around 96% of the Nigerian government’s revenues go to paying off the interest on its national debt. Against the background of Ghana’s debt default woes, Zambia’s drawn-out restructuring and Kenya’s fiscal stress, Nigeria’s economic policy decisions are keenly watched by investors and business people alike. Taxes affect consumption habits. Nigeria infamously has an even lower consumption capacity (measured by the number of people who spend $10 daily) compared to neighbouring Ghana. MTN Nigeria, the country’s largest mobile carrier by market share frequently reports lower average revenues per user compared to South Africa or Kenya, for example. By embracing a managed float of the naira, the government sent an early signal that it will embrace traditional economic management. But the unwillingness of the government to allow its bonds to reflect market price expectations has muted investor response even as bank stocks and inflation soared. If the events of the previous two days are any guide, Nigerians may expect mixed policy signals as Tinubu’s fiscal policy is fully revealed. Social media reactions show an expectation that Oyedele will provide a moderating influence on how federal tax policy is formed and implemented. But the new government’s reform zeal will be tested in the coming months as the impact of painful policies fully settles across the economy.
Read MoreYCombinator doubles down on fundamentals as it releases first ever ‘top companies by revenue’ list
As YCombinator shares its first ever list of top companies by revenue, is it a sign to the startup ecosystem about where VCs are headed in terms of priority metrics for their portfolio companies? For the first time ever, San Francisco-based accelerator YCombinator has released its top 50 alumni companies by revenue list. The esteemed accelerator is known for using valuations to rank companies. Of the listed companies, Africa has only one representative: Wave, the Senegalese mobile money app. Other startups which feature include Airbnb, Dropbox, Coinbase, and Reddit. Since the start of the VC downturn in early 2022, YCombinator has stressed to founders the need to move from a “growth at all costs” mentality to building business models which show a path to profitability. Is this new trend of spotlighting revenue as a core metric in judging alumni’s success the beginning of the accelerator’s shift towards bottomline growth heralding? Speaking to TechCabal on a call, Clive Butkow, CEO of Johannesburg-based VC firm Kalon Ventures believes that it is the beginning of not only YCombinator’s push for bottomline growth in its cohorts, but the VC industry in general. “In a downturn, every investor is going to be frugal with their funds because they are so hard to come by, so its not surprising to see YCombinator insisting on the importance of revenue as a growth metric. Of course revenue is still a topline metric so I think eventually, we will see them maybe sharing a Top 50 most profitable startups list,” he said. What does this development mean for African startups? According to Ato Bentsi-Enchill, head of special spurpose vehicles (SPVs) at Microtraction, a Nigerian early stage VC firm, the list should encourage African startups to prioritise metrics like revenue instead of growth at all costs. “Maybe this is a way to encourage startups who perhaps want to apply to YCombinator by showing them the revenue-making abilities of some of their alumni. At the same time, maybe its a subtle reminder to founders that ‘at the end of the day, you’re building a business and business is about making money, and for anyone to invest in your business,” he said to TechCabal. As VC dollars continue to be a unicorn, hard to find, Bentsi-Enchill advises startups that beyond focusing on revenue, it is important for them to think of addressing problems beyond just Africa. Global problem solving in a sustainable and business-sound way will be the next wave. “[At Microtraction], we are also thinking through refining our thesis to make sure that we’re investing in founders whose businesses have applications both on the continent, but can also be expandable across the world and address far-reaching problems,” he added. Regardless of YCombinator’s reasoning for putting out such a list for the first time ever, the fact that such a leading global investor is a sign of wind of change is blowing through the VC industry and whether African startups like it or not, they will have to adapt to the new modus operandi.
Read MoreWhat does remote work mean for compulsory in-person staff?
As more companies embrace the remote work model, some employees face uncertainties around their roles. *Karima is an office assistant at a lending startup in Lagos who earns about ₦80,000 monthly. Her responsibilities include providing managers and other staff with hands-on support, such as making a cup of coffee, welcoming guests or receiving and storing packages. Some days are busier for her than others, depending on the number of staff who come in. The startup runs a hybrid work arrangement, which sometimes reduces her workload. However, Karima worries about what could happen if the company decides to go fully remote. “I’m working on getting some tech skills for myself so that I can easily upskill and switch roles. Most startups are going remote, and if my startup fully goes remote, I might not have a job,” Karima shared. Karima occasionally offers some assistance to remote workers as well, but she argues that it’s work that can be outsourced. “I carry out tasks like overseeing the shipment of work materials to remote workers, but that’s not enough responsibility to keep me on a company’s payroll.” Karima is one of many compulsory in-person workers who are uncertain about the future of their jobs. In the middle of a funding winter, startups are doing all they can to cut costs and stay afloat: brutal layoffs, chopping down marketing budgets and embracing remote work as an operations cost-saving method. While most employees are happy to work remotely as it saves them the stress and time of a daily commute, not everyone can enjoy those benefits, as there is a category of employees whose roles are threatened by remote work. Compulsory in-person roles—administrative staff, office assistants, office managers, and janitors—whose jobs typically require their physical presence are the first to be affected by a shift to remote work. Not only do these employees stand to lose their jobs, it’s more difficult for them to find decent-paying jobs elsewhere. According to Karima who’s currently studying for a diploma at the Lagos cooperative college, the tech industry pays some of the most competitive rates for someone like her, who does not have a university degree. “For this my role and qualification, I’ll probably just earn slightly above the minimum wage. In my first job, before I came here, I was paid ₦25,000 for the same set of responsibilities—and I even had to do more work. I earn a decent amount of money here because it is a tech company and they have more money to an extent. If this company and other tech companies decide to fully go remote, it’s going to be very difficult for me to find another job that’s as good as my current one. This is why I’m doing my best to pick up new skills so that it will be easier for me to find something in the future.” Taiwo Ajaga is an admin manager at Big Cabal Media, which has a widely distributed staff. From a management perspective, Ajaga explains that remote workers indeed save the company money in terms of office space and utilities, and are ultimately easier to deal with. While his role requires him to be at work every day, Ajaga is well acquainted with digital tools that can facilitate his responsibilities in the case of a full shift to remote work. He also believes that a totally remote office should not be too difficult to circumvent for some compulsory in-person staff like office assistants and managers, as they can leverage digital tools to do their jobs well. “Transitioning to a fully remote setup can require adjustments, but with the right support, tools, and processes, admin roles can be managed effectively,” he shared with TechCabal. While there’s truth in Ajaga’s views, the considerably large digital divide in Nigeria must be taken into consideration. Only about 38% of the country’s population has consistent access to the internet due to factors like a lack of devices and poor internet connectivity. These factors, in addition to widespread digital illiteracy, undoubtedly obstruct the ability of staff to adapt to a fully remote work system. Additionally, a lot of compulsory in-person roles are lower-level, and do not pay well enough for staff to acquire the appropriate devices and stable internet connectivity. Is the hybrid work model a saving grace? Joseph*, a tech recruiter, believes that some compulsory in-person workers do not have adequate transferable skills and will eventually lose their jobs in the case of fully remote workforces. According to him, adopting a hybrid work model can mitigate these possible outcomes. “Considering the fact that a number of roles will be made redundant with a fully remote work arrangement, I think a hybrid work arrangement will cushion that effect. You won’t have these people just be without jobs, because to be honest, just a few of them have transferable skills. As a cleaner or office assistant, what skill do you want to transfer to a different role that will make you still relevant in the career space? So I always advocate for the hybrid work model,” he said. Abdul*, who also works as a tech recruiter, agrees with Joseph. He also believes that Nigerian companies won’t be going fully remote anytime soon as a large number of people aren’t equipped with sufficient digital skills to manage this. “I think the market is still largely hybrid and will remain so for the foreseeable future. While some startups might choose to go that route, I still think that office settings will still exist for a long time and that way, there will always be room for physical staff at other companies,” he shared with TechCabal. While the hybrid work model may serve as a middle ground, allowing for a combination of remote and in-person work, the challenges posed by limited literacy, inadequate internet access, and a lack of transferable skills create significant barriers for employees in compulsory in-person roles to adapt to a fully remote workforce. As companies navigate the changing landscape of work,
Read MorePoS operators may stop services as FCCPC blocks price increase
The regulatory clampdown on the recent price increase has raised uncertainty and apprehension among operators who are now faced with the prospect of significant changes to their business operations. On Wednesday, the Federal Competition and Consumer Protection Commission (FCCPC) barred PoS operators in Nigeria from increasing the service charges and threatened a sanction. The Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) fixed a service charge of ₦100 for withdrawals between ₦1000 to ₦2400. The president of AMMBAN’s Lagos chapter, Abiodun David, said the proposed price hike was due to the economic realities of PoS operators. According to him, PoS operators may consider other lines of business if the authorities don’t approve the service charge increase. “There is nothing strange in what we have done. The current realities are not convenient for us. Transporters and market traders have done so,” he said. “Why is our case different?” he wondered over the phone in an interview with TechCabal. POS service charge increase in Lagos remains unchanged in Abuja In Lagos and Abuja, the realities have been different. In Iju Ishaga, Lagos, Matthew, a PoS operator charged ₦400 for withdrawing ₦12,000. According to the new prices, the correct fee should be ₦600. In Abuja, the service charge for withdrawals and deposits is unchanged. Reuben, a regular user of the PoS service believes that if there are additional charges imposed on PoS services in Abuja, it will reduce his usage of the service for transactions. “Abuja is blessed with so many banks, and cash is mostly available in their ATMs. So instead of paying extra charges than what I am currently paying for the PoS service, why not just take a stroll to the nearest bank(s) around and get my money?” he asked.
Read MoreAfreximbank and Fiducia join forces to provide financing to SMEs through factoring
Through its partnership with African Export-Import Bank, Fiducia is providing financing to SMEs in Africa through factoring and actively raising awareness about its benefits among African businesses. Fiducia, an investment firm, is partnering with African Export-Import Bank (Afreximbank) to provide additional liquidity for small businesses in Africa through factoring. Factoring provides SMEs with immediate access to cash flow by converting their unpaid invoices to funds. Small and Medium Enterprises (SMEs) are the driving force of economic development in Africa, accounting for 90% of all businesses, 50% of employment and 40% of GDP across the continent. While SMEs contribute the majority of economic output and employment generation in Africa, they often lack access to financing they need to strengthen their businesses. Only 20% of African SMEs have a line of credit. The partnership between Afreximbank and Fiducia seeks to address this concern through factoring. “Fiducia is actively raising awareness about factoring and its benefits among African businesses,” Imohimi Aig-Imoukhuede, the CEO of Fiducia, told TechCabal. “Through joint promotional and educational campaigns, we aim to highlight the advantages of factoring and provide the necessary knowledge to potential users.” Fiducia’s move to reduce the financial gap through factoring is a novel solution and the company is currently testing the waters in Nigeria. According to the CEO, the startup is working with developmental finance institutions and legal firms to “develop a blueprint for the sector” while also advocating for the adoption of sector-friendly policies and regulations. “By collaborating with these stakeholders, we can create an enabling environment for factoring to thrive and expand its reach in Nigeria and across the continent,” he said. Zuvy raises $4.5 million to scale invoice financing in Nigeria How it works The factoring process, which Fiducia aims to implement through its marketplace, involves SMEs supplying goods to corporate buyers. The SMEs upload invoices, which are validated and approved by the corporate buyers. Funders then bid on the invoices, and Fiducia selects the successful funder. Fiducia sends funding instructions to the funder, and the SMEs receive funding. On the due date, the corporate buyers pay the funder. Fiducia facilitates the entire process, ensuring efficient transactions and business growth. “The goal is to facilitate smoother cash flows, improve inventory management, and enhance overall financial stability within the supply chain ecosystem,” Aig-Imoukhuede told TechCabal. Risks abound While Fiducia’s novel approach represents a way forward for financing SMEs in Africa, risks abound. SMEs that opt for factoring may have higher default rates compared to larger, more established businesses. To mitigate this risk, Fiducia says it maintains close relationships with clients and actively monitors their performance and market dynamics to detect potential disruptions in the supply chain. To minimise the credit risks financiers face, Fiducia provides them with market and sector data to help them to filter out those that do not conform to selected criteria. While concentration risk might pose another challenge to financiers, Aig-Imoukhuede asserts that Fiducia mitigates this by allowing financiers to diversify their portfolios. “By employing a proactive and risk-aware approach, we will support the sustainability and resilience of our factoring solutions.” Future Plans While Fiducia is testing the waters in Nigeria, it aims to “make factoring a convenient and reliable financing option for African businesses,” according to the CEO. Aig-Imoukhuede stated that Fiducia plans to deepen its presence across multiple markets on the continent through strategic partnerships.” By establishing strategic partnerships, we will leverage existing networks and expertise to reach clients (even SMEs in remote areas),” he said. “Ultimately, our long-term goal is to contribute to the growth and development of African economies by empowering SMEs, fostering financial inclusion, and driving economic prosperity through factoring,” he concluded.
Read MoreAirtel Kenya announces 5G with unlimited broadband plans
Airtel launches 5G in Kenya, following Safaricom’s lead. 5G Wi-Fi was also introduced. Airtel has become the second telco to launch 5G in Kenya after Safaricom rolled out the service in October 2022, following months of testing. Airtel, also Kenya’s second-largest network operator, announced the product at an event attended by multiple leaders in the ICT sector, including Kenya’s cabinet secretary for ICT, Eliud Owalo, and the director-general of the Communications Authority of Kenya (CA), Ezra Chiloba. Airtel 5G will initially be available to a select number of customers as the carrier only has 370 5G sites spread across 16 counties. The operator did not specify which areas would be served. However, the service is expected to focus on customers in major areas and cities such as Nairobi, Nakuru, Mombasa, and Kisumu. Ashish Malhotra, the managing director of Airtel Kenya, said, “Airtel 5G will revolutionise various sectors, such as smart cities, education, healthcare, Agri-tech, transport systems, entertainment, and more, shaping the future of Kenya.” Airtel has also followed Safaricom’s lead by announcing the availability of 5G Wi-Fi. Safaricom introduced a similar product last year, enabling customers to purchase a 5G router and connect to the network in areas with 5G signals. Airtel 5G Wi-Fi plans Airtel will sell 5G-supported routers to interested customers at KES 10,000 ($72) and for businesses for free, whereas Safaricom charges KES 25,000 ($180) for the same device. Airtel will offer 5G home broadband connections to residential houses and businesses. Plans start at KES 3,500 ($25) at 10Mbps. Customers needing higher speeds will pay more, with 30Mbps costing KES 5,500 ($40) and 50Mbps at KES 7,500 ($54). Airtel will also sell volume-based home data plans starting from KES 3000 ($22). These packages are also unlimited, making them appealing to customers needing high internet speeds. Safaricom also offers the same product at KES 3500 ($25), KES 6000 ($43), and KES 15000 ($108) for 10Mbps, 40 Mbps, and 100Mbps, respectively. Unlike Airtel 5G Wi-Fi plans that are unlimited, Safaricom’s 5G broadband is limited to a given volume of data. Airtel 5G bands and mobile plans Airtel Kenya told TechCabal that its 5G connection is based on a sub-6 GHz frequency band. This refers to the frequency range below 6 GHz. It includes frequency bands such as 600 MHz, 700 MHz, 2.5 GHz, 3.5 GHz, and 4.9 GHz. Sub-6 GHz signals have relatively longer wavelengths, so they can travel longer distances and penetrate obstacles like buildings and walls more effectively. However, they generally offer slightly lower data speeds compared to mmWave. mmWave operates at much higher frequencies, typically between 24 and 100 GHz. These high-frequency signals can provide fast data speeds, even reaching multi-gigabit-per-second rates. However, they have a limited range and are easily blocked by obstacles, including buildings and trees. Thus, mmWave 5G is primarily used in dense urban areas where high capacity and speed are needed. For now, Airtel customers need 5G-capable devices to access the network. However, the carrier has not announced specific 5G plans. Airtel argues that customers will be moving in and out of 5G areas and will be well-served by 4G bundles, which can access 5G without issues. In contrast, Safaricom has introduced 5G-specific bundles, cheaper than other plans but can be used on both 4G and 5G networks. Regulatory support More players may join the 5G race in Kenya, with the next candidate being Telkom Kenya. However, the state-run entity has been facing financial difficulties, leading to the telco’s failure to pay the American Tower Corporation (ATC) KES 200 million for tower leasing. As a result, ATC switched off half of the towers, impacting millions of Telkom customers. The presence of the Communications Authority of Kenya’s director-general, Ezra Chiloba, also indicates the regulator’s support for telcos as they transition to offering 5G services. The CA has not announced specific 5G spectrum fees but has chosen to bill telcos based on deployment and per-installed links. For example, if an operator installs 5G services in a particular area, they will pay fees for that specific area. The regulator will eventually establish a standard cost in the coming days.
Read MoreExclusive: Healthtech startup, Medsaf, lays off all its full-time employees amid claims of unpaid salaries
In March, Medsaf, a Nigerian healthtech startup, laid off all its full-time employees. Former employees allege that their salaries and benefits remain unpaid. Nigerian healthtech startup, Medsaf has laid off all its full-time employees, TechCabal can exclusively report. The company’s chief operating officer (COO), Rotimi Lawal, told employees on Slack that Medsaf had to reduce its workforce following “challenges ranging from funding gaps to account receivables due to different the macroeconomic policies and dismal payment behavior of hospitals in our industry.” A source told TechCabal that about 30 employees were affected. At the time of Lawal’s Slack message, several employees confirmed that they hadn’t been paid salaries since December 2022. The company acknowledged the salary delays and promised to make good on the payments. “In the context of how work activity has fared so far this year, with the majority of the employees staying at home and doing little or no work, the Company will be paying full salary for December 2022 to those who I haven’t paid yet and half payments for January 2023 up till March 2023. These payments will be made to the staff’s bank account in the Month of April 2023,” Lawal wrote in the Slack message. A former employee who spoke to TechCabal on the condition of anonymity said the company only paid salaries for March. Three other former employees told this publication that they still haven’t received their owed salaries and that there has been no communication from the management on the payment. They also alleged that their pensions and pay-as-you-earn (PAYE) tax were not remitted. Another source who left the company last October alleged that his pensions were paid for only three months of the 15 months he spent at Medsaf. “The best way I can describe the situation is a tragedy,” the source told TechCabal over a call. In an email response to TechCabal, Medsaf’s CEO, Nwakah, blamed the situation on investors reneging on funding commitments. “The funds we were expecting would have been enough to extend our run rate for 1.5 years and allow us to close on a $2m loan that would push our company into profitability. We told people not to come to work in January and told people formally that we were not extending their roles in March. So many of the employees that you are speaking with hardly worked in January and are requesting salaries that are owed to them when they were not actively working for the company,” she said. Unpaid salaries and financial struggles In 2017, Vivian Nwakah co-founded Medsaf to combat the proliferation of fake and substandard drugs in Nigeria and across Africa. Its website defines Medsaf as “a curated medication marketplace for African hospitals and pharmacies.” It also claimed it grew 200% during the pandemic and had raised $2.7 million in funding in January 2022. Two sources told TechCabal that Medsaf began to struggle in mid-2022 with delays in salary payments. According to the sources, the CEO told employees the company wanted to raise funds. “Some people left, but they [the management] kept promising that things would get better, so we decided to wait out for them,” one of the sources said. But the situation worsened, as the November salaries weren’t paid until the fourth week of December. According to our sources, the company also didn’t pay salaries from January till March, when the layoffs happened. Two other sources alleged that Medsaf also owed some of its vendors. Alleged financial misappropriation A former senior executive alleged that Medsaf’s CEO withdrew company funds for personal use. According to the source, Medbury Medical Services paid Medsaf over $100,000 in early 2023 for drug distribution projects but the money “was neither in Medsaf’s bank account nor was it in medication stocks.” “The money was used to pay other debts and siphoned out of the company. This left suppliers and employees unpaid,” the source told TechCabal. Medsaf did not specifically comment on these claims but suggested that the company’s lawyers would send a detailed response. Medbury Medical Services couldn’t be reached for comments at the time of writing this report.
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Steps to check CAO status 2023
The Central Applications Office (CAO) plays a vital role in facilitating the tertiary education application process in South Africa. If you’re an aspiring student seeking admission to a university or college, it’s essential to stay updated on your CAO status. This article provides a comprehensive, step-by-step guide on how to check your CAO status in South Africa. Step 1: Visit the CAO website To begin, access the official website of the Central Applications Office in South Africa. Open your preferred web browser and search for “CAO South Africa.” Click on the official link, which should direct you to the CAO homepage. Step 2: Log in to your CAO account Once on the CAO website, navigate to the login section. Enter your username and password to access your account. Step 3: Locate the “Check my Application Status” After logging in, explore the CAO website interface and find the section dedicated to checking your application status. Look for a tab or link labelled “Check Application Status” or something similar. The CAO website is designed to be user-friendly, making it relatively easy to find the relevant section. Step 4: Enter the required details In this step, you will be prompted to enter certain details to retrieve your CAO application status. Typically, you will need to provide your CAO application number or ID, as well as any other specific information requested by the system. Ensure you double-check the accuracy of the details you enter to avoid any potential errors or delays in retrieving your status. Step 5: Complete your CAO status check Once you have submitted the necessary information, the CAO system will process your request. After a few moments, your CAO status will be displayed on the screen. The status will provide information regarding your application, such as whether it is still being processed, accepted, deferred, or rejected. Make sure to carefully read and note down the information provided. Final thoughts on CAO status check Staying updated on your CAO status is crucial when pursuing higher education in South Africa. By following the step-by-step guide outlined above, you can conveniently check your application status through the official CAO website. Remember to regularly monitor your status throughout the application process to ensure you don’t miss any important updates or deadlines. Best of luck with your educational journey!
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👨🏿🚀TechCabal Daily – Kenya’s new ghost buster
In partnership with Share this newsletter: Lire en Français اقرأ هذا باللغة العربية TGIF Congratulations to the winner of our Referral Raffle: Tony! Thanks for reading and referring the newsletter. If you enjoy TC Daily too, you can win great prizes you actually need by spreading the word. We’ve got Showmax subscriptions, shopping vouchers and merch to give out. So spend our money, refer TC Daily today by sharing the code at the bottom of this edition. In today’s edition SA urges Starlink to engage ICASA Zimbabwean electricity industry seeks $246 million Kenya now has a unified payroll system Funding tracker The World Wide Web3 Event: The Africa Social Impact Summit Opportunities Internet Starlink not coming to SA unless it meets ISP requirements South Africans may not see Starlink anytime soon. This week, communications minister Mondli Gungubele reiterated the government’s stance on why Starlink cannot officially operate in the country: it needs to meet the SouthAfrica’s internet service provider (ISP) ownership equity rules first. The most critical of these rules is that ISPs like Starlink will have to give up a 30% ownership stake for historically disadvantaged groups (HDG) including black people, women, youth, or people with disabilities. Communications minister Mondli Gungubele It could take a really long time: Amending the regulations to accommodate Starlink would not be a simple process and would likely take several months or even years to pass through the public consultation process and government sign-off. Gungebele said that Starlink or its parent company SpaceX could engage with the Independent Communications Authority of South Africa (ICASA) to seek advice on local operations. Zoom out: Icasa has confirmed it had discussions with SpaceX regarding Starlink on two occasions. During these meetings, SpaceX sought guidance on the regulatory requirements or process for acquiring the necessary electronic communications service licences in South Africa. Elon Musk’s Starlink satellite internet service has already connected several African countries, including Mozambique, Rwanda, and Mauritius, with 35 more African countries scheduled for launch in 2023 and 2024. You’ll be in good company Moniepoint has made it simple for your business to access payments while providing access to credit and other business tools. Click here to open a business account today. Economy Kenyan government introduces payroll management system President William Ruto President William Ruto is ensuring civil servants in Kenya stay in check. The Kenyan president has ordered the implementation of a Unified Payroll Number (UPN) system in all state agencies to reduce the government’s wage bill and streamline payroll management. Promoting accountability: The UPN system aims to unify the payment structure for all government officials, including civil servants, teachers, and employees of state agencies, into a single, simplified system, ensuring fair and equal compensation for all public servants. Through a permanent and unique identification number assigned to each individual, the system can effectively address concerns like ghost workers, double-dipping, and incorrect compensation, safeguarding public funds and fostering accountable governance. Side bar: Double-dipping is when an individual receives multiple payments or benefits for the same period of work or service. On August 4, 2022, the head of the public service notified all Public Service organisations about the national government’s adoption of the Unified Human Resource System (UHR). This integrated system will function as a centralised platform for managing data related to human resources in the public sector, including payroll information. To this end, the Teachers Service Commission (TSC) has embraced the use of the UPN per the head of the public service’s decision last August. Zoom out: The introduction of the UPN system represents a major stride in the ongoing efforts to modernise administrative processes and establish a fair and efficient payment structure for government officials. Economy Zimbabwean industry seeks $246 million for floating solar panels Image source: Britannica Zimbabwe’s industrial electricity consumers are aiming to raise R4.7 billion ($246 million) for phase one of floating solar panels on Kariba Dam. Ownership agreement: The Zimbabwean government’s sovereign wealth fund will possess a 10% share in the company, while the remaining 38% will be open to investors, including development banks. Members of The Intensive Energy User Group, including mining companies, will have a 52% ownership stake in a development company responsible for the project located in Kariba Dam. The power station initially designed for 250 megawatts will generate electricity sold to the group and other eligible customers through a 25-year power-purchase agreement. Electricity shortages in Zimbabwe: Kariba Dam, the world’s largest dam between Zimbabwe and Zambia, causes acute electricity shortages in Zimbabwe. Low water levels hinder generation from the hydropower plant, coupled with frequent breakdowns at the thermal power station, leading to blackouts lasting over half a day. By installing 1.8 million photovoltaic panels on 146 modular units, the site has the potential to accommodate 1 gigawatt of capacity, according to a March report compiled for Zimbabwe Power Co. by China Energy Engineering Group. What are photovoltaic panels? Photovoltaic panels, also called solar panels, are devices that convert sunlight into electricity. Zoom out: These power supply challenges highlight the need for alternative solutions and investments in renewable energy sources to ensure a more reliable and sustainable electricity supply. GrowthCon 1.0: Learn how to unlock 10X Growth Connect with growth leaders, operators, and enablers to explore proven tactics for driving sustained business growth in Africa at GrowthCon 1.0. Experience curated masterclasses, case studies, a growth hackathon and more. Get your tickets now at 15% off. Use the discount code “TIX15”! TC Insights Funding Tracker Image source: TechCabal Insights This week, Nuru, a solar company in the Democratic Republic of Congo (DRC), raised $40 million in equity funding. The round was led by IFC, Global Energy Alliance for People and Planet (GEAPP), Renewable Energy Performance Platform (REPP), Proparco, E3 Capital, Voltalia, the Schmidt Family Foundation, GAIA Impact Fund, and the Joseph Family Foundation. Here are the other deals this week: MYDAWA, a Kenyan online pharmacy, received $20 million in an undisclosed round from Alta Semper Capital, a private equity firm. Zuvy, a fintech company, secured $4.5 million
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From hashtags to ballots: how an army of social media consultants and influencers impacted Nigeria’s 2023 elections
The EU Election Observation Mission released a report showing more social media activity during Nigeria’s 2023 elections. TechCabal interviewed campaign strategists to understand the social media strategies used by candidates, the costs, and how that might change in the future. While the actors on the Nigerian political scene may remain unchanged for years, the country’s politics adapts quickly. For instance, in 2015, social media was a big force in Nigeria’s presidential election campaigns. And a new report from the EU Election Observation shows that 2023 saw social media play an even more pivotal role in electioneering. Candidates and their supporters used social media to shape narratives and boost the appeal of their messaging to a wide audience. Image source: The EU Election Observation Mission Yet the correlation between social media activities and election outcomes remains tenuous. While the All Progressives Congress (APC) won the presidential election, its candidate made fewer social media posts compared to that of the other major parties; the People’s Democratic Party (PDP), Labour Party (LP), and New Nigeria People’s Party (NNPP). Despite how compelling social media conversations may be, only a fraction of Nigerians take part in social media discourse. Statista and the EU report show that only 31.6 million of 221 million Nigerians use social media platforms, and most of these users are young. This explains why youths make up 71% of the 12 million Nigerians who applied for voter cards last year. How much did social media matter? It takes a small army of social media professionals to give candidates and parties a voice on online; social media advisors and consultants are at the top of the pile but they all work with content creators and influencers. ”The candidates and their parties have separate social media advisors and consultants. Some consultants come with their own teams and campaign plan. But they all work in silos—independent of others,” Ayobami Adekojo, a strategist who worked for PDP said. Another strategist, Akin Adewale, who worked for APC, told TechCabal that these plans are based on the candidates’ strengths, weaknesses, allegations against him and his good deeds. And while social media was abuzz with election campaigns and discussions, it got little attention in most campaign budgets. Ayobami told TechCabal, “Only a drop of PDP’s budget went to social media.” Adeshina Ayomide, a member of the APC Campaign Council in the United Kingdom, said APC’s campaign budget was about ₦1.5 billion. “Most of it went to traditional media—television, radio, and print media —while only about ₦200 million went to social media channels,” he said. But Ayobami noted that this will significantly increase in the future considering the success of the Labour Party’s campaign. The party’s presidential candidate, Peter Obi, came third. It was the first time a third-force candidate showed such potential. He received the most votes in online polls including one by Bloomberg. Strategists link his performance to his party’s social media campaign. How presidential candidates used social media Of all the 18 presidential candidates, nine used social media. An analysis of 1,089 posts by the presidential candidates showed that they mostly used Facebook and Twitter. Their posts included videos of campaign rallies, press statements, encouragement, manifestoes and smear campaigns. There were also accounts dedicated to promoting parties and candidates. The EU report identified 946 of them and found that the accounts of these supporters saw higher activity than those of the candidates. For example, Labour Party supporter Aisha Yesufu posted an average of 22 videos per week on YouTube and had about 5,619,278 views. This is much more than Labour Party did. Image source: The EU Election Observation Mission Parties often paid to increase the reach of their messaging. From January till the middle of March, Nigerian political parties paid Meta ₦28,784,369 to advertise political content on Facebook and Instagram. They also paid influencers on TikTok, Snapchat, Facebook, Instagram and Twitter. Even though only 0.04% of the country’s total internet users are on Twitter, political parties employed influencers on Twitter the most. “This is because Twitter has more real-time audience and the algorithm of the platform makes it easier for news to spread quickly,” Akin Akinwale explained to TechCabal. PR professional Adeshina Ayomide, who also worked with APC says it is also because other platforms are mostly for entertainment and do not have political influencers like Twitter does. Image source: The EU Election Observation Mission These strategists pay influencers to post content pre-crafted by content creators and narrative shapers. Toyosi Godwin, who has 111,800 followers confirmed this. He told TechCabal that most of the time influencers are approached with pre-written tweets which they post upon payment of the agreed fee. “Even when the influencer writes the post by themself, the contractor must edit it before they can share it with their followers,” he added. The influencer’s fee depends on their follower count and Twitter influencers typically charged between ₦25,000 – ₦50,000 per tweet. While popular Facebook and Instagram bloggers like Tundeednut, Linda Ikeji, and YinkaTNT charge ₦1 million or more per post. Even though it is popular and lucrative, Influencers often claim that they do not dabble in the pay-for-tweet venture. Toyosi told TechCabal that he turns down such offers because he values personal freedom and public integrity more. Adeshina, who has over 14,000 Twitter followers said, “Influencers like me in APC received a monthly stipend of around ₦100,000. But it is purely to support our work rather than serve as a fee for our services. We were not directly remunerated for the work we undertook.” Image source: The EU Election Observation Mission Challenges of social media campaigns Influencers often suffer online harassment for the posts they make about candidates. They get attacked by people who suspect that they were paid to make the posts. “Opposition campaigns use troll farms,” Ayobami who has worked on PDP campaigns told TechCabal. There are WhatsApp and Twitter groups of people that have used several accounts to attack posts about their opposition. When these social media sweatshops are not bullying
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