kelvin mpemba
New Member
- Jun 20, 2017
- 2
- 5
Let me tell you something that will blow your mind, the other day on my way back home in the late evening I came across an old man who was selling watermelon. His price list reads 1 for TSh.3,000 and 3 for TSh.10,000. A young man stopped by and bought 3 watermelons one by one paying TSh. 3,000 for each. As the young man was walking away, he turned around and said out loudly despite having a facial mask covering his mouth (to prevent himself from the pandemic COVID-19), “Hey old man, do you realize I just bought three watermelons for TSh.9,000 instead of TSh. 10,000?, may be business is not your thing”.
To my surprise the old man smiled and mumbled to himself,” people are funny.Everytime they buy three watermelon instead of one, yet they keep trying to teach me how to do business”. It is for certain that humans are egocentric in nature; the need to matter and to be better than everyone else, the old man used that knowledge to his advantage .That is when I realized, lack of trading information is perhaps more of a constrain in business development compared to infrastructure inadequacy
It is surprising that people don’t know what their neighbor country are selling, for instance a person who wants to join international trade, first thing that comes in mind is China or Europe and doesn’t think of a neighbor nation as a market, an African nation will go to China to purchase apples which are produced in South Africa, or purchase Maize in New Zealand that Burundi are selling. Perhaps Intra-trade in Africa has only been 17% by 2019 simply because of using the same business techniques rather than being innovative and making changes on the current approaches that are used in conducting business. Most of agricultural goods in our mother continent are exported beyond the borders of Africa and not amongst ourselves for many years.
I believe for effective exchange of information, the scale of device used to transfer information should start from the least i.e. analog devices (phones) which are used by small traders to the most advanced level which are smartphones and laptops with the assist of the internet. , Providing media officials with adequate training and education on the Intra Africa trade can help to create awareness to the majority at an effective way (television radio, socio-media & newspaper) in a limited time, also creation of advertorials and jingles in national dailies to project the importance and benefits of the intra Africa trade. I have to comment that African governments have been slow boosting intra Africa trade but now with the current flow of information, digitalization and accessibility of information, government has observed that their own intra African trade is taking place and shaping out with or without them
On the contrary to popular belief, intra-regional trade needs to be improved in their trading system before we head to intra Africa trade, using regional blocks such as EAC, SADC and ECOWAS they will be a very good start in building milestones to achieve high level of trade amongst ourselves. It is very obvious that if we cannot achieve efficiency in intra-regional blocks intra Africa trade will likely fail
While acknowledging efforts so far invested by the government across Africa encouraging the public private partnership, I would look beyond protectionism and provide more incentives free trade promotion, need for more execution. The government has to work with private sector (banks and microfinance) to see what the gaps in terms of infrastructure and services are and what should be done to resolve them.
“If you want to go fast go alone. If you want to go far, go together”, a very famous African proverb which gave me a thought that this was an accusation of the lonely runner who wanted to go quickly, until I realized that speed and distance are morally neutral objectives. There are times we need to go fast and there are times when we need to go far, some people need to do each more often than the other. Africa has a good history of protectionism, while it’s true an economy adopts protectionism policy to encourage domestic investment in a specific industry, it has a downside of giving consumer an access to fewer goods at a high price based on little completion available. It is time Africa needs to talk to herself, looking at the key issues that for many years have impeded trade and investment.
Reduction of tariff and non-tariff barriers of which in Africa they are relatively high, will reduce friction of moving goods from one nation to another i.e. Promotion of open market economy there is a need for more execution that has to work with the private sector to see what are the gaps in terms of the infrastructure, information flow and policy and what can be done to fill this gap, by eradicating import tariff, barriers to entry, bureaucracy procedures in the cross border areas and promote transparency in the market to minimize market risk, foster competition and reducing price
In 2018,I visited my uncle, a local coffee peasant in Kilimanjaro who has a dream of expanding his business and become a big commercial farmer in Tanzania, if not in Africa, but the financial institution (banks and micro finance) within his region have been a huge setback to his progress, they charge high interest rate for loan payment moreover banks which are intended to support agriculture are located in urban areas where farming is less likely to happen this is a huge setback for SME growth, but I believe that SME need security to scale up production for export and financial institution has to play part in the growth if such enterprise, foreign exchange should be accessed at a reasonable charges to facilitate international trade.
Deliberate efforts are to be made to connect Africa, more railways and roads construction among nation to ease logistics rather effort are to be made to get less barrier to avoid market spoil for example it might take up to 2 weeks in country border for a truck driver to clear his documentation. Also a good supply chain within Africa should be organized to minimize the logistics cost and improve the trade volume. But on the contrary, Africa trade will be about 1 trillion dollar by 2030(www.un.org), meaning that is what the available infrastructure of Africa can carry, but why is intra Africa still 17%-18% of it? Market knowledge is still a key that I insist, if China can ship apples to a given country using the available infrastructures, why can’t Tanzania ship oranges through the same infrastructure that is the question we need to ask ourselves, am not saying infrastructure is not a problem it is basically is but a generalized one
Risk aversion is well-known common behavior universal to humans, as a general and robust characteristic of people’s decision making: people are less likely to gamble when they are unsure if they will obtain the expected value of the bet made, and in African intra trade risk bearing facilities are inadequate.
“The irony is that the person not taking risks feels the same amount of fear as the person who regularly takes risks” ~Peter McWilliams, this is where export trading companies are needed, traders do not understand the risk the foreign country presents and are more likely to not trade due to less information ,but with these trading house existence, it will help to boost export in high extent , they may help an agricultural trader to find overseas buyers and provide them with other pertinent market information. Also they provides support services for firms and business people engaged in exporting. This may include warehousing, shipping, insuring, and billing on behalf of the client. That easing the trading process at a high extent
It is with no doubt that agriculture is the heart of most African economies and I firmly believe that with the right approach intra Africa trade can unlock agricultural potential in the continent, boosting development of other sectors as well, creating more employment in a given country and lastly build competitiveness among nation to foster development.
“By 2030, the size of the food and agri-business in Africa will reach $1 Trillion. So if you are thinking of how to make money, that is the sector to be in”~ Dr. Akinwumi A. Adesina
To my surprise the old man smiled and mumbled to himself,” people are funny.Everytime they buy three watermelon instead of one, yet they keep trying to teach me how to do business”. It is for certain that humans are egocentric in nature; the need to matter and to be better than everyone else, the old man used that knowledge to his advantage .That is when I realized, lack of trading information is perhaps more of a constrain in business development compared to infrastructure inadequacy
It is surprising that people don’t know what their neighbor country are selling, for instance a person who wants to join international trade, first thing that comes in mind is China or Europe and doesn’t think of a neighbor nation as a market, an African nation will go to China to purchase apples which are produced in South Africa, or purchase Maize in New Zealand that Burundi are selling. Perhaps Intra-trade in Africa has only been 17% by 2019 simply because of using the same business techniques rather than being innovative and making changes on the current approaches that are used in conducting business. Most of agricultural goods in our mother continent are exported beyond the borders of Africa and not amongst ourselves for many years.
I believe for effective exchange of information, the scale of device used to transfer information should start from the least i.e. analog devices (phones) which are used by small traders to the most advanced level which are smartphones and laptops with the assist of the internet. , Providing media officials with adequate training and education on the Intra Africa trade can help to create awareness to the majority at an effective way (television radio, socio-media & newspaper) in a limited time, also creation of advertorials and jingles in national dailies to project the importance and benefits of the intra Africa trade. I have to comment that African governments have been slow boosting intra Africa trade but now with the current flow of information, digitalization and accessibility of information, government has observed that their own intra African trade is taking place and shaping out with or without them
On the contrary to popular belief, intra-regional trade needs to be improved in their trading system before we head to intra Africa trade, using regional blocks such as EAC, SADC and ECOWAS they will be a very good start in building milestones to achieve high level of trade amongst ourselves. It is very obvious that if we cannot achieve efficiency in intra-regional blocks intra Africa trade will likely fail
While acknowledging efforts so far invested by the government across Africa encouraging the public private partnership, I would look beyond protectionism and provide more incentives free trade promotion, need for more execution. The government has to work with private sector (banks and microfinance) to see what the gaps in terms of infrastructure and services are and what should be done to resolve them.
“If you want to go fast go alone. If you want to go far, go together”, a very famous African proverb which gave me a thought that this was an accusation of the lonely runner who wanted to go quickly, until I realized that speed and distance are morally neutral objectives. There are times we need to go fast and there are times when we need to go far, some people need to do each more often than the other. Africa has a good history of protectionism, while it’s true an economy adopts protectionism policy to encourage domestic investment in a specific industry, it has a downside of giving consumer an access to fewer goods at a high price based on little completion available. It is time Africa needs to talk to herself, looking at the key issues that for many years have impeded trade and investment.
Reduction of tariff and non-tariff barriers of which in Africa they are relatively high, will reduce friction of moving goods from one nation to another i.e. Promotion of open market economy there is a need for more execution that has to work with the private sector to see what are the gaps in terms of the infrastructure, information flow and policy and what can be done to fill this gap, by eradicating import tariff, barriers to entry, bureaucracy procedures in the cross border areas and promote transparency in the market to minimize market risk, foster competition and reducing price
In 2018,I visited my uncle, a local coffee peasant in Kilimanjaro who has a dream of expanding his business and become a big commercial farmer in Tanzania, if not in Africa, but the financial institution (banks and micro finance) within his region have been a huge setback to his progress, they charge high interest rate for loan payment moreover banks which are intended to support agriculture are located in urban areas where farming is less likely to happen this is a huge setback for SME growth, but I believe that SME need security to scale up production for export and financial institution has to play part in the growth if such enterprise, foreign exchange should be accessed at a reasonable charges to facilitate international trade.
Deliberate efforts are to be made to connect Africa, more railways and roads construction among nation to ease logistics rather effort are to be made to get less barrier to avoid market spoil for example it might take up to 2 weeks in country border for a truck driver to clear his documentation. Also a good supply chain within Africa should be organized to minimize the logistics cost and improve the trade volume. But on the contrary, Africa trade will be about 1 trillion dollar by 2030(www.un.org), meaning that is what the available infrastructure of Africa can carry, but why is intra Africa still 17%-18% of it? Market knowledge is still a key that I insist, if China can ship apples to a given country using the available infrastructures, why can’t Tanzania ship oranges through the same infrastructure that is the question we need to ask ourselves, am not saying infrastructure is not a problem it is basically is but a generalized one
Risk aversion is well-known common behavior universal to humans, as a general and robust characteristic of people’s decision making: people are less likely to gamble when they are unsure if they will obtain the expected value of the bet made, and in African intra trade risk bearing facilities are inadequate.
“The irony is that the person not taking risks feels the same amount of fear as the person who regularly takes risks” ~Peter McWilliams, this is where export trading companies are needed, traders do not understand the risk the foreign country presents and are more likely to not trade due to less information ,but with these trading house existence, it will help to boost export in high extent , they may help an agricultural trader to find overseas buyers and provide them with other pertinent market information. Also they provides support services for firms and business people engaged in exporting. This may include warehousing, shipping, insuring, and billing on behalf of the client. That easing the trading process at a high extent
It is with no doubt that agriculture is the heart of most African economies and I firmly believe that with the right approach intra Africa trade can unlock agricultural potential in the continent, boosting development of other sectors as well, creating more employment in a given country and lastly build competitiveness among nation to foster development.
“By 2030, the size of the food and agri-business in Africa will reach $1 Trillion. So if you are thinking of how to make money, that is the sector to be in”~ Dr. Akinwumi A. Adesina
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