The Central Bank of Nigeria joined a growing list of emerging markets betting on digital money to cut transaction costs and boost participation in the formal financial system.
“Nigeria has become the first country in Africa, and one of the first in the world to introduce a digital currency to her citizens,” President Muhammadu Buhari said in televised speech at the launch in Abuja, the capital. “The adoption of the central bank digital currency and its underlying technology, called blockchain, can increase Nigeria’s gross domestic product by $29 billion over the next 10 years.”
The International Monetary Fund projects GDP for Africa’s largest economy to be $480 billion in 2021.
The issuance of the digital currency, called the eNaira, comes after the central bank earlier in February outlawed banks and financial institutions from transacting or operating in cryptocurrencies as they posed a threat to the financial system.
Since the launch of the eNaira platform, it’s received more than 2.5 million daily visits, with 33 banks integrated on the platform, 500 million c ($1.2 million) successfully minted and more than 2,000 customers onboarded, central bank Governor Godwin Emefiele said at the launch.
Central bank digital currencies, or CBDCs, are national currency — unlike their crypto counterparts, such as Bitcoin and Ethereum, which are prized, in part, because they are not tied to fiat currency. The eNaira will complement the physical naira, which has weakened 5.6% this year despite the central bank’s efforts to stabilize the currency.
“The eNaira and the physical naira will have the same value and will always exchange at one naira to one eNaira,” Emefiele said.
The digital currency is expected to boost cross-border trade and financial inclusion, make transactions more efficient as well as improve monetary policy, according to the central bank.
“Alongside digital innovations, CBDCs can foster economic growth through better economic activities, increase remittances, improve financial inclusion and make monetary policy more effective,” Buhari said. Digital money can also “help move many more people and businesses from the informal into the formal sector, thereby increasing the tax base of the country,” he said.
The Central Bank of Nigeria in August selected Bitt Inc. as a technical partner to help create the currency that was initially due to be introduced on Oct. 1.
Nigeria joins the Bahamas and the Eastern Caribbean Central Bank in being among the first jurisdictions in the world to roll out national digital currencies. China launched a pilot version of its “digital renminbi” earlier this year. In Africa, nations from Ghana to South Africa are testing digital forms of their legal tender to allow for faster and cheaper money transactions, without losing control over their monetary systems.
Africa Industrialization Week 2021 at UNIDO
A series of webinars on themes such as the Fourth Industrial Revolution, climate-related challenges in industrialization, and opportunities for Japanese and other international investors on the African continent, marked the beginning of Africa Industrialization Week 2021 at the United Nations Industrial Development Organization (UNIDO).
Africa Industrialization Week, observed by the United Nations system each year in November, focuses on raising awareness of the importance of Africa’s industrialization and the challenges faced by the continent.
“The African Continental Free Trade Area – AfCFTA – agreement, which came into being this year, opens up a huge market of 1.3 billion people and is a US$3.4 trillion economic bloc with the potential to lift 30 million Africans out of extreme poverty. Coupled with the African Union’s Agenda 2063 and the 2030 Agenda for Sustainable Development Goals, it will help focus on addressing the existing challenges and opportunities to accelerate the industrial development of the continent,” said UNIDO Director General, LI Yong, in his message on the occasion.
“The Fourth Industrial Revolution (4IR) has deep implications for sustainable development of Africa, and governments’ policymaking approach towards new technology and innovation needs to be more agile, flexible and resilient,” according to Bernardo Calzadilla-Sarmiento, UNIDO Managing Director of the Directorate of Digitalization, Technology and Agribusiness at UNIDO.
At a webinar on ‘Road to 4IR for Africa,’ Calzadilla-Sarmiento said that by 2030 Africa’s potential workforce will be among the world’s largest and there is a massive opportunity for growth when this is coupled with the needed infrastructure and suitable skills for innovation and technology use.
Other panellists from the field of robotics, Artificial intelligence and the Internet of Things also discussed the potential strengths and opportunities, as well as the challenges for African industrialization.
In a separate webinar, hosted by UNIDO’s Investment and Technology Promotion Office (ITPO) in Tokyo, the panelists discussed ways to facilitate and promote investment and technology transfer, especially from Japan, for industrial development in Africa. Panelists emphasized that there was a need to increase manufacturing capabilities and improve capacity building, especially in sectors like pharmaceuticals, both for domestic consumption and for export.
“There are projected business opportunities valued at US$ 5.6 trillion by 2025 due to the increased spending capacity of US$ 3.5 trillion and growth in household consumption to US$2.1 trillion. This creates great business opportunities for investors from Japan, as well as from the rest of the world,” opined Mansur Ahmed, Vice President of the Africa Business Council.
In a webinar on “Carbon-Neutral and Resilient industrialization in Africa,” the panelists discussed ways of addressing the challenges of climate change and ensuring an inclusive and sustainable industrial development on the continent. They agreed there is a need for a policy environment that allows private sector participation in energy generation, and a need to develop pathways aligning industrial policy goals with national climate action priorities and policies.
In 2016, the United Nations proclaimed the period 2016-2025 as the Third Industrial Development Decade for Africa (IDDA III) and tasked UNIDO with leading the implementation of the Decade, in collaboration with a range of partners. According to Victor Djemba, chief of UNIDO’s Africa division, UNIDO coordinated the development of a Joint Roadmap to better streamline international efforts into programmes and projects for the continent’s industrial development activities. “The vision for the implementation of IDDA III is to firmly anchor Africa on a path towards inclusive and sustainable industrial development,” he added.
Ethiopia: Humanitarian aid needed as situation deteriorates in Tigray
With the dire humanitarian situation in Tigray, Ethiopia, continuing to deteriorate, it is critical to establish a regular flow of humanitarian aid into the region, the Deputy Spokesman for the UN Secretary-General said on Wednesday.
Yesterday, almost 40 trucks with humanitarian supplies, including food, left the Afar capital of Semera for Tigray – the first convoy to do so since 18 October.
Meanwhile, trucks containing fuel and medical supplies are still waiting for clearance in Semera.
Around 500 trucks of humanitarian supplies are required per week, Farhan Haq informed journalists at a regular press briefing.
Seven million food insecure
In November 2020, heavy fighting between central Government troops and those loyal to the Tigray People’s Liberation Front (TPLF) have left Ethiopia’s northern regions of Tigray, Amhara and Afar in dire need of humanitarian assistance.
And after months of killings, looting and destruction of health centres and farming infrastructure, including irrigation systems that are vital to the production effort, those needs have only surged.
Currently, some seven million people throughout the country are suffering acute food insecurity.
Meanwhile following their suspension on 22 October, UN Humanitarian Air Service flights to Mekelle have resumed, allowing the UN and humanitarian partners to rotate staff in and out of Tigray and transfer a limited amount of operational cash.
However, said the Deputy Spokesperson, “humanitarian partners on the ground continue to report significant challenges due to cash shortages for operations”.
Despite a $40 total injection of new resources to Ethiopia – $25 million from CERF and $15 million from the country-based Ethiopia Humanitarian Fund (EHF) – the country still faces a funding gap of $1.3 billion, including $350 million for the response in Tigray.
Despite an extremely challenging operating environment, humanitarian partners continue to respond to urgent and growing needs across northern Ethiopia, including in Amhara and Afar.
In Amhara, a major food assistance operation kicked off in Kombolcha and Dessie towns, targeting more than 450,000 people over the next two weeks.
Yesterday, the UN announced that given the security situation in the country, and out of an abundance of caution, it is reducing its footprint in Ethiopia by temporarily relocating all eligible dependents.
“It is important to note that staff will remain in Ethiopia to deliver on our mandates”, said Stéphane Dujarric, Spokesman for the Secretary-General.
The UN will monitor the situation as it evolves, keeping in mind the safety of the staff and the need to continue its operations and support all those who need assistance.
Earlier this month, the Organization confirmed that at least 16 UN staff and dependents had been detained in the Ethiopian capital, Addis Ababa, and that it was working with the Government of Ethiopia to secure their immediate release.
Ghana Can Create Better Jobs through Accelerated Economic Transformation
Ghana has an opportunity in the coming decades, to accelerate economic transformation and create more and better jobs, after navigating through the heights of the pandemic. It can achieve this through fostering greater global integration, technological transformation, macroeconomic stability, and financial sector development, says the World Bank’s latest economic analysis for the country.
The newly released Country Economic Memorandum, Ghana Rising – Accelerating Economic Transformation and Creating Higher Quality Jobs says Ghana has all it takes to continue being an economic development star, if it takes the right steps to nurture growth and job creation.
“Ghana faces an acute challenge of generating more and better jobs and has a ‘missing middle’ of employment in mid productivity sectors”, notesPierre Laporte, World Bank Country Director for Ghana, Liberia and Sierra Leone. “This is the time for Ghana to fill that ‘missing middle’ by cultivating export-oriented activities in both manufacturing and services and harnessing the transformative potential of trade; it faces an historic opportunity to do so with the Africa Free Trade Continental Area (AfCFTA).”
The report highlights four main pillars for accelerating economic transformation and improving jobs outcomes:
- To create jobs, Ghana will need to drive sectoral transformation through the movement of workers into higher productivity firms and sectors and spatial transformation through trade, urbanization, and connectivity. ‘Global innovator’ services, in particular ICT and business services, could play a critical role.
- To deliver productivity growth and boost innovation and entrepreneurship, it will need to drive technological transformation through the adoption of digital and complementary technologies in domestic firms. To enable this change it will be key to improve internet connectivity, invest in foundational skills and advanced digital skills, and facilitate technology adoption for firms.
- To support more inclusive private sector development, Ghana will need to leverage the financial sector to facilitate firm expansion, technology adoption and innovation.
- To enable long-term inclusive growth, Ghana will need to double down on macro-fiscal stability, natural resources management and revenue mobilization (to generate the revenues to fund reforms for economic transformation). Environmental taxation can boost revenues while helping to minimize the impact of climate change on households and incentivize sustainable land-use.
“This report lays out three scenarios for an accelerated economic transformation for better jobs” adds David Elmaleh, World Bank Senior Economist, and co-author of the report. “Without reforms, in a ‘business as usual’ scenario, Ghana’s economy is currently projected to reach upper middle-income status by 2037, while under a ‘bright horizons’ scenario, which includes the adoption of some key reforms to drive economic transformation, Ghana’s economy could reach upper-middle-income status by 2032. However, under a ‘pitfalls’ scenario, Ghana would have to wait until 2040. The greatest impact on GDP would be from reforms to raise the productivity of export-oriented global innovator services and manufacturing. This can start now, under the new budget.”
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