I am really enjoying audible during lockdown. It’s something to do while i do something menial or to relax.
The latest listen is Dan Simmons’ “Hyperion”. I listened to about an hour last night and I’m hooked.
Another cool thing I just discovered about Audible is that you can exchange books you have already read. So I’m refreshing my library to help get me through this lockdown.
Easter tomorrow. Wishing you chocolate, health, and peace of mind.
Happy Saturday chimps.
It’s nearly the end of the day and I haven’t yet managed to write a blog post.
I’m on about 22 posts in my bid for 30 straight. I nearly laughed it off today, but I will be damned if I am going to let this very difficult day get in the way of a good writing streak!
That’s the thing about streaks, once they start you are less likely to quit.
This still counts, and the streak goes on!
Happy Friday night chimps.
It’s nearly the end of the day and I haven’t yet managed to write a blog post.
I’m on about 22 posts in my bid for 30 straight. I nearly laughed it off today, but I will be damned if I am going to let this very difficult day get in the way of a good writing streak!
That’s the thing about streaks, once they start you are less likely to quit.
This still counts, and the streak goes on!
Happy Friday night chimps.
A four way video call with some old friends last night means I have some homework to do. I was recommended two books to read.
In my quest to connect South African and Kenyan businesses they seem quite relevant, so I bought them on amazon while i was still chatting on the call:
| The Bottom Billion: Why the Poorest Countries are Failing and What Can Be Done About It (Grove Art) and It’s Our Turn to Eat |
One thing this Covid 19 virus has shown us is how useful virtual meetings can be. The various services available (Skype, Hangouts, Zoom etc.) have experienced a massive surge in demand and use over lockdown periods around the world. Zoom in particular has become very popular and very varied in its use cases. Security issues are popping up due to the scale and choices they made with their software. Still, it’s changing the options for work and socialising – all due to a lockdown.
Last night we swayed between a Whatsapp chat group and a Google Hangouts chat. Hangouts was clearer and easier through the laptop compared to Whatsapp.
Our call was full of stories about Kenya days growing up, nostalgia, catching up on news. I really enjoyed it and can’t wait to read the books I was recommended. The call was cut short by my friend who needed to join another Zoom call straight afterwards. A sign of the times.
Those times are changing fast. Stay safe and keep in touch out there! Chats like this are golden and good for the soul.
Happy Thursday Chimps.
…Health and peace of mind.
The FM Global Resilience Index is an effort to show resilience at a national level (although it sometimes splits a country up into regions such as USA – coasts are vulnerable to flooding compared to mainland USA).
The results from 2019 are interesting – Kenya ranks 99th (just dropping into the 4th quartile) vs South Africa’s 47th (hitting the middle of the world rankings after some poor performance leading up to the rankings themselves).
From my experience this difference makes sense. Infrastructure is one of the most obvious difference in the two countries for me (SA scores 59 vs Kenya’s 39) – a factor with direct impacts on resilience. For 30 years or so, Kenyan governments almost refused to invest in infrastructure. For a variety of reasons, roads went to pot(holes) and electricity became a punchline. This can’t be good for a country’s resilience and as a boy arriving in SA I would be astounded at the smooth highways, the lack of power cuts. It bears mentioning that SA is heading down the same path. Watch this space.
In 2019, South Africa fell eight places in the overall Index (from 39th to 47th), in part due to its 20-place drop in the corporate governance ranking (from 14th to 34th). Those state capture cases are biting the country hard. Kenya is hardly able to gloat on this though – fraud and corruption has blighted the East African country for decades.
So the obvious test of these rankings is now upon us. Which country can respond better to the COVID 19 pandemic? There’s a positive spin on things – let’s see this damned virus as a “test of resilience”. I hope both these beloved countries can make it through relatively unscathed. I fear for the worst though.
To all in SA and Kenya – Keep healthy and well – then let’s rise up the ranks.
The post-war push for integration and globalisation led to the creation of many (MANY!) supranational organisations. Chief among them the UN (1945), World Bank (1944), the IMF (1945), and the WTO (which in 1995 replaced the General Agreement on Tariffs and Trade from 1948).
These organisations have set out to integrate the global economy like never before. We are all, in a sense, still recovering from horror scenes in places like Nagasaki, Hiroshima, Normandy and Stalingrad. From the awful promise mutually assured destruction.
Mostly and until recently, these supranational organisations have been successful. Conflict is down, wealth and health are up. Trade has trumped conflict and the globe has become a lot smaller. For example, the WTO touts statistics that in the post-war era as a whole, trade grew at one-and-a-half times the rate of expansion in global GDP; in the two decades running up to the financial crisis of 2008, it expanded at fully double the rate of world growth.
However, cracks have started to appear. What seems to be an inability of organisations such as the WTO to keep up with the times has led to parties like America becoming disenfranchised with new powers (China) being treated as a ‘developing’ country, and Britain feeling stuck in its ties to the sluggish economies of the EU.
Today’s more skeptical attitude can also be felt in developing cities like Nairobi. Kenya is a centre for the UN in Africa, and anecdotally I have witnessed the ridicule of vehicles baring UN number plates. The story goes that these UN minions are out of touch, keeping to themselves in barricaded communities, spending enormous amounts on foreign goods and high salaries for foreign workers who don’t actually do very much to help Africa or the world.
At a macro economic level, the new attitude towards these supra-nationals means that when trade is liberalised, it is through bespoke arrangements between willing partners—not by across-the-board multilateral negotiations. In this new world, it could soon become hard to remember what the point of the WTO is. As stated in this excellent article:
“Even with the best will in the world, a technocratic body like the WTO is always going to struggle to deal with brute political power play. And right now, it is operating in anything but a good-will environment. The many useful things that this inherently feeble body can usefully achieve are slipping beyond its reach—because it is as strong or as frail as its most powerful members, above all America, want it to be.”
https://www.prospectmagazine.co.uk/magazine/worryingly-troubled-organisation-why-the-wto-is-in-serious-peril
With this global backdrop, Kenya and South Africa are commonly involved in their own fair share of supra-national organisations:
South Africa and Kenya are both members of the World Trade Organisation (WTO); African Union (AU) which is in the process of negotiating a continental free trade area (CFTA) as well as members of the tripartite free trade agreement (TFTA) comprising of members of the Common Market for East and Southern Africa (COMESA), the East African Community (EAC) and the Southern Africa Development Community (SADC), … but there has been no bilateral trade agreement between the two countries….
https://www.tralac.org/resources/our-resources/12248-south-africa-s-trade-with-kenya.html
Trump would probably argue that these supranational organisations are getting in the way of a fruitful bilateral agreement.
I would probably agree.
In 1998 I was a 16 year old just starting to drink alcohol in Nairobi. I remember clearly the arrival of South African beers (Castle lager) in the bars as an alternative to Tusker, the king of Kenyan beer. Castle came in cans, and until then it had all been glass Tusker bottles. Tusker soon started to can their beer to keep up, which I always nostalgically thought was a pity.
What I didn’t understand was the turbulent backdrop to these shiny cans and bottles sitting on the shelves in all the pubs. A corporate war was started when SA Breweries landed in Nairobi and invested in a plant in Thika. SAB entered East Africa’s largest economy through a business partnership with local brewer East Africa Breweries Ltd, maker of Tusker.
Lucrative markets and very similar products meant that it was a race to the bottom for both parties to keep or gain market share. After much drama (accusations of sabotage, protectionism, underhanded tactics by both parties), a price war benefiting consumers and a huge influx of different brands of beer into the market, the deal soon fell apart, forcing SABMiller to shut down its Thika plant and exit Kenya in 2002.
So what? Why does this matter? To me this is an important example of the SA vs Kenya dynamic. Synergies and opportunities are spotted, but what could have been an opportunity for strengthened bonds and cultures turned into a one-on-one brawl. Perhaps this is due to the nature of the product itself. Highly commoditized, all that was left was grabbing market share by any means. Prices dropped, tactics by all accounts got dirtier.
If South Africa and Kenya are to trade successfully, then perhaps the product traded needs to contain a little more differentiation, a little more art. It must demonstrate clearly its addition and novelty to the local market. Ideally there is no local equivalent to protect, because neither country wants to let the other one in if they feel the market already exists. Both are proud of their status as African giants. As an example, South Africa won’t allow Tusker to be sold in SA. A trademark technicality has kept it out for decades.
Recently SABMiller is back in the Kenya market but is only importing beers into the market. A more cautious approach is probably wise considering the first foray.
If I was going to trade goods into Kenya, I would try to find something that is just not available yet, and introduce it carefully with local partners. This was done with cell phones, pay tv and many other goods which didn’t trigger a price war. I’m sure there will be more to come.
Anyways. Happy Sunday chimps!
I just received an email from my bank. It was an investment piece describing various scenarios they had researched for the effect of Coronavirus on the markets. Lots of volatility, mixed with under priced companies which will be good bets when the timing is right. (That’s a ridiculously simplistic summary by me, but you get the picture).
So when will the timing be right? When there are no more cases recorded? When the death rate slows? (For the best stats check out worldometer.info/coronavirus).
I just got off the phone from my folks in Nairobi and I think we’re in for a long haul in Kenya and in South Africa. I don’t have the spare cash or the inclination to be making any bets at this stage.
I’d like to thank my bank for thinking of my cash investment at such a time as this though. Its comforting to know some things don’t change.
Kenya has a positive story to tell potential investors: In the past 5 years Kenya has risen 80 places in the World Bank’s Ease of Doing Business Index, from 136th to 56th. 80 places??!!! That is a large chunk of the table right there. I would liken it to Usain Bolt taking the baton in the final leg of the school relay, blitzing the field from last place.
This is a clear demonstration of the Kenyan government’s commitment to attract and retain local and foreign investments in the country. It is also just a statistic which is a simplification of a far more complex reality.
Regular visits to the country in this period have shown me what this change means in real life – populations have boomed, infrastructure projects are going up all over the place, demographics are changing (Chinese takeaway anyone?) and general busy-ness (as opposed to business) and traffic in hubs such as Nairobi and Mombasa have become anything from manic to unbearable.
Contrast this to South Africa’s fortunes on the index – slipping from 43rd to 84th in the last five years. These years have been blighted by massive corruption scandals, theft, crime, strong and irrational unions, and macro economic factors conspiring against the growth in SA. Labelling as junk status was inevitable. Check the below charts for GDP per capita growth over the years in the 2 countries:
SA GDP / Capita
And here is Kenya’s:
You can see from the charts that South Africa is still a far richer place. In practice this means that life here is closer to a western standard of living. It is far less chaotic and ‘Jua Kali’ as it is in Kenya. Roads are smooth, phones and power lines are (largely) unbroken. Shops have everything you could desire. You could argue strongly that life is easier here.
Probably the biggest factor working against ease of doing business here in SA is government policy and the legacy of apartheid. It still looms so heavily over every government decision. Contrast this to Kenya where independence and colonial legacy is becoming less and less of an issue. Power lies with the local elites. Tribal politics trumps racial issues.
Chimpwithcans 