Gondwe’s first task will be to draft a newgovernment budget, due in parliamentlater in June.

Malawi, traditionally dependent onWestern aid donors, will look for “newfriends” in countries such as China andRussia, Mutharika said at his inaugura-tion. Around 40% of the budget comesfrom aid, leading the new president tosay, “We will continue with traditionalrelationships, but we are now lookingfor new friends in emerging economiessuch as Brazil, China, India, SouthAfrica and Russia.”

Britain and the United States havealready pledged to work with his gov-ernment. (© AFP 2,6/6 2014)

Meanwhile, the Nyasa Times (5/6)reports that Malawi’s development part-ners under the Common Approach toBudgetary Support (CABS), have saidthey will take a position on when toresume funding after they see the com-mitment of the new administration inaddressing concerns raised over thecountry’s public finance management.

The CABS chairperson, AlexanderBaum, told a local radio that the groupingis scheduled to meet the new administra-tion’s officials on the way forward afterthe appointment of cabinet ministers.

He said they felt it was important toengage with the new governmentbecause there were lot of issues thatneeded to be followed up.

“As the president has already that hewants to focus on key areas like publicfinance management and the manage-ment of the economy, I think the firststep towards that is discussion when thetime comes,” Baum said. (Nyasa Timeswebsite, Leeds 5/6)

NIGERIAGrowing Consumer Class

The country still lags in terms of workerproductivity, but more people havemoney to spend.

The value of Nigeria’s consumer marketcould reach US$1.4trn by 2030, from thecurrent yearly figure of US$400bn,according to a report by the MckinseyGlobal Institute (MGI).

The private BusinessDay newspaper onMay 28th quoted the report as estimat-ing that the value of food and non-foodconsumer goods would account for$1trn of the total.

In the report, entitled, “Nigeria’s renewal:Delivering Inclusive Growth in Africa’sLargest Economy’’, MGI said one of themost important under-appreciatedchanges in Nigeria was the growing sizeand strength of its consuming class.

“While the middle income is $680 peryear and 43% of the population livesbelow the poverty line, the number ofhouseholds in the consuming class isgrowing rapidly,” the report said.

“In 2013, an estimated 8m householdshad income of more than $7,500 peryear, the threshold which MGI considersas ‘emerging consumers’, with sufficientincome to meet all basic necessities andhave money to start buying more andbetter food as well as health and educa-tion services,” it added.

The report said that labour productivityin the country had grown by 3.6% peryear since 2010 and had contributed tothe greatest share of its Gross DomesticProduct (GDP).

The oil and gas sector had many oppor-tunities to improve productivity, thereport said, adding however, that thelarge share of the economy that existedoutside oil and gas was where the pro-ductivity gap to other countries emerged.

It explained that the recent rebasing ofthe economy had demonstrated that thenatural resources sector was a smallershare of the country’s economy, thusclearing the misconception by peopleoutside Nigeria that the oil sector is theengine of growth in the Nigerian econ-omy as it is in several Middle Easterneconomies.

The report, however, said in spite of theimprovement in labour productivity,Nigeria was still far behind other majordeveloping economies.

“At less than $9,500 per worker per year,Nigerian output is 58% less than theaverage of seven large developing econ-omies.

“Nigeria also has a low ratio of employ-ment to population of 31% comparedwith 52% in Brazil, 46% in Indonesiaand 48% in Russia,” the report added.

It said productivity was also being heldback by poor infrastructure, whichincreased the cost of doing business inthe country.

MGI was established in 1990 to developa deeper understanding of the evolvingglobal economy. (PANA, Lagos 28/5)

Oil Flows Again

Anglo-Dutch oil group Shell has resumedcrude oil exports from a key terminal insouthern Nigeria after repairing a sabo-taged pipeline, the company said onMay 16th.

Shell’s subsidiary in Nigeria, SPDC, saida “force majeure” declared on exportsfrom the Forcados terminal on March25th was lifted on May 15th “followingthe removal of a crude theft point on theexport line.”

“Force majeure” is a legal term releasinga company from contractual obligationswhen faced with circumstances beyondits control.

The company shut the underwater pipe-linewhen a leakwas discovered onMarch4th, leading to the suspension of exportsthrough the terminal, which can produceup to 400,000 barrels of crude per day.

Shell has blamed repeated oil thefts andsabotage of key pipelines as the majorcause of spills and pollution in the oil-producing region.

Crude oil theft or “bunkering” is amajor problem in Nigeria, with estimatesthat the country loses some $6bn inrevenue every year because of thepractice. (© AFP 16/5 2014)

Meanwhile, the European Union (EU)has approved an additional grant of €80mto boost job creation in the four stateswithin Nigeria’s Niger Delta region.

Nigeria’s Supervising Minister ofNational Planning, Alhaji Bashir Yugu-da, said in Abuja on May 22nd at thenational launch of the States’ Employ-ment and Expenditure for Results(SEEFOR) project, that the full imple-mentation of the grant in other States ofthe country had begun. The SEEFORproject is to be financed with a credit ofUS$200m provided by the World Bank.Yuguda said the additional financingwould translate to more jobs for youths,more financial prudence, greater accessto socio-economic services, a cleanerenvironment, and more accreditedcourses in technical and vocational col-leges.

The head of the EU delegation toNigeria, Mr Michel Arrion, said youthunemployment was one of the reasonsgiven for the rising spate of terrorismand other security threats as experiencedin Nigeria, stating that the grants werepart of efforts by the EU to strengthenand enhance self-sufficiency and accessto finances. (PANA, Abuja 23/5) Trade

union urges action on insecurity p. 20377A

SOUTH SUDANHumanitarian Intervention

The UN makes a bid to prevent faminein 2015.

The Food and Agriculture Organisation(FAO) is scaling up its emergencyresponse operations in South Sudandespite problems of access and insecurityin parts of the country, the UN agencysaid in a news dispatch from Juba onJune 5th.

FAO said it had extended its emergencyresponse for an additional three monthsto reach conflict-affected farmers, fishers

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and herders with vital emergency liveli-hood kits that will enable them to plantcrops, fish waterways and protect live-stock from fatal diseases.

Since the crisis began, more than 110,000emergency livelihood kits have beendistributed, including crop seeds, fishingkits, vegetable seeds and livestock healthkits.

With US$42m of funding received todate, FAO is supporting 1.3m people.

However, it said more funding isurgently needed to reach out to vulner-able rural communities in the worst-hitareas while building resilience through-out the country and prevent a furtherworsening of food insecurity.

FAO is therefore appealing for $108m aspart of the UN’s revised Crisis ResponsePlan and has received $42m to date.Additional funding could bring the totalnumber of people supported in 2014 to2.7m.

As well as targeting conflict-affectedcommunities with large-scale distribu-tions by truck, FAO successfully flew 21tonnes of crop seeds to Pibor in Jongleistate in partnership with the UnitedNations Missions in Sudan (UNMISS).

Subsequently, FAO undertook an emer-gency airdrop with the support of theWorld Food Programme (WFP) logis-tics capacity, dropping packages from aplane to a partner on the ground whothen distributed the seed to farmers.Although used only as a last resort dueto their high cost, airdrops guaranteethat farmers in the most inaccessibleareas receive support, enabling them togrow their own food and making theoperation cost-efficient in the long run.

Three tonnes of crop seeds were success-fully air-dropped in Mayendit county,Unity State, and will enable 250 house-holds to produce over 200 tonnes ofcrops including maize, sorghum, cowpeaand sesame.

“FAO is doing everything it can to assistthe highly vulnerable people of SouthSudan, including innovations in the deliv-ery of seeds through airdrops,” said SueLautze, FAO’s Head of Office in SouthSudan and the UN’s Deputy Humanitar-ian Coordinator in the country.

“The humanitarian response has beenfacing serious logistical challenges inreaching affected communities,” Lautzesaid. “Humanitarian access and insecu-rity remain the biggest threats to foodsecurity in the country – if we cannotreach those in most need there is a realrisk of famine later in 2014 and into2015.” (FAO 5/6)

On May 20th at a conference in Oslo,Norway, donors including the US and

the UK pledged more than $600m in aidto South Sudan. The sum raised will gotowards the total target of $1.8bn theUN says is needed to help millionsfacing starvation.

UN humanitarian chief Valerie Amossaid it was still possible to prevent afamine in the conflict-torn country.More than a million people have fledtheir homes since fighting erupted inDecember.

Thousands have died in the crisis thatstarted as a political dispute betweenPresident Salva Kiir and his sackeddeputy Riek Machar, but escalated intoethnic violence.

The conflict has left people unable tofarm and with little access to food, aidexperts say. Nearly four million people inSouth Sudan are now at risk of seriousfood insecurity, according to the UN.

The new aid announced at the donors’conference included $100m from the UKgovernment, nearly $300m from the USand $75m from the EU. The sum of$600m will be added to $536m alreadypledged – but that is still only two-thirdsof the way to the UN target. (BBC NewsOnline 20/5) Dire humanitarian warnings

p. 20380A

TANZANIAIllicit Outflows Report

Billions are lost to the country by trademis-invoicing.

Tanzania’s mining revenues are toutedas a key way to reduce reliance onforeign aid and pull people out ofpoverty, but experts argue companiesare swindling the government out of atleast $248m a year.

The East African nation topped theworst of a list of nations across thecontinent examined by the watchdoggroup Global Financial Integrity (GFI),with nearly $19bn in illicit flows over thepast decade, the equivalent to over sevenpercent of the country’s total govern-ment revenue.

“There’s a narrative in the developmentcommunity that there’s somethingwrong with developing countries,because we keep pumping money in,and they’re not developing as quickly aswe’d like them to,” said GFI economistBrian LeBlanc.

“The reality is that we’re draining moneyout, and we’re doing it at an increasingrate.”

The Washington-based GFI’s examina-tion of trade mis-invoicing reveals starkfigures. Mis-invoicing occurs when busi-nesses deliberately lie about the value ofthe goods they are importing or export-ing. There are a lot of illegal reasons todo this, including tax evasion and moneylaundering.

Globally, trade mis-invoicing is a $424bn a year problem, and makes up about80% of all the money that flows out ofdeveloping countries illegally, GFI said.

Numbers like this, when compared toaid, mean there’s far more money drain-ing out of Africa than going in.

Humanitarian Needs

Around 7.3m people are at risk of hunger

At least 4m face alarming food insecurity,particularly in Unity and Jonglei

Around 223,000 children face severe acutemalnutrition

Around a million are internally displaced,half of them children

More than 83,000 of the internally dis-placed are at eight UN bases

Close to 350,000 people have fled toneighbouring countries

The number of refugees abroad could riseto 863,000 by December

Source: UN South Sudan Crisis ResponsePlan, May 2014

SudanWater Shortage Protests

One person was killed on June 8th in thecapital, Khartoum, as police fired tear gasto disperse a demonstration over watershortages, police and witnesses said.

Hundreds of residents of southern Khar-toum took to the streets after repeatedcuts in drinking water supply to the area,blocking off a main road with rocks andtree branches, witnesses said.

Police said they intervened to disperse thecrowds and reopen the road in the Mayodistrict.

“One person suffered from (tear gas)inhalation and later died,” they said in astatement.

A witness, who declined to be named, toldAFP the police fired tear gas and “beat upthe protesters with clubs.”

Several areas of Khartoum have been hitby water cuts over the previous month, asituation exacerbated by rising summertemperatures.

President Omar al-Bashir has called for apolitical and economic renaissance inSudan, which is ravaged by war, povertyand political turmoil. His call to engagepoliticians in a national dialogue cameafter the government slashed fuel subsidiesin September 2013, sparking huge streetprotests. (© AFP 8/6 2014)

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