Monday, 22 June 2020

President of Dangote Group, Aliko Dangote has said that despite the challenging economic situation in 2019, Dangote Cement  was able to sustain 54,000 jobs in four African countries, where the company has its operations. The countries are Nigeria, Ethiopia, Senegal and South Africa.

The business mogul who disclosed this to shareholders at the company’s 11th Annual General Meeting in Lagos said that more jobs would be created as the company intensifies the export of clinker to other neighboring countries from Nigeria.

“According to our 2019 socio-economic impact assessment study specifically on our operations in Nigeria, Ethiopia, Senegal, and South Africa, we sustained 54,005 jobs (direct, indirect, induced) in these four markets in the year under review,” he said.

Dangote told the shareholders that the year 2019 was a strong year given the tough business environment across most of its operating geographics, disclosing that the group recorded volumes of 23.7 million metric tons and revenues of ₦891.7 billion.

He said: “We recorded a strong EBITDA margin of 44.3 percent. As a result of this performance, the board has recommended for your approval a dividend of ₦16.00 per ordinary 50 kobo share.”

Speaking on the local Nigerian operations, he said: “Nigeria’s cement market grew slightly in 2019. We estimate that total market consumption was up between 2 per cent-3 percent on the 20.7Mt estimated in 2018.”

Dangote explained that the modest performance was in spite of the fact that the market generally was impacted negatively by the disruptions related to the 2019 election cycles, heavy rains and the loss in land export volumes due to the border closure.

“Dangote Cement’s Nigerian operations remained at 14.1Mt in 2019, including export sales of 0.45Mt. Domestic sales in Nigeria were nearly 13.7Mt, compared to 13.4Mt in 2019. This implies a 2 percent growth

Published in Business

The mobile gaming industry continues to grow with developers generating revenue in millions of dollars on a daily basis. Data acquired by Finbold.com shows that by June 2020, games on iOS devices generated approximately $13.29 million in daily revenue.

 

From the data, Fortnite leads in average daily revenue at $2.75 million followed by Roblox with revenue of $2.40 million. Augmented reality mobile game Pokemon Go ranks third with returns of $1.86 million while Coin Master closely follows at $1.80 million. Candy Crush Saga brings in the fifth-highest daily revenue of $1.42 million.

Supercell’s freemium mobile strategy video game Clash of Clans is sixth with returns of $0.94 million while Gardenscapes is seventh at $0.84 million. Elsewhere COD: Mobile generates $0.69 million average daily revenue as of June 2020 to rank in the eighth spot. Homoscapes comes ninth after returning of $0.35 million while cartoon adventure game Toon Blast closes the tenth spot with an average daily return of $0.24 million on iOS devices globally. 

Top 10 mobile gaming app by revenue

 

Roblox leads in new daily installs

Our research also focused on the worldwide iOS gaming apps by the number of daily new installs as of June 2020. Roblox leads the way with an estimated average of 21,034 installs on a daily basis. COD: Mobile is second with an estimated average of 20,566 daily installs while Pokemon GO comes third at 19,291. Elsewhere Clash of Clans is fourth with installs of 19,206 on average per day. Single-player, casual mobile game Coin Master closes the top five categories with about 19,169 installs. 

Candy Crush Saga is sixth in new installs at 19,139 followed by Toon Blast at 18,518. Gardenscapes comes eighth at 18,150. Homescapes and Fortnite install come ninth and tenth at 15,845 and 15,728 respectively. It is worth noting that despite Fornite having the highest daily revenue, it trails other games in new daily installs. The highlighted data excludes re-installs during the period under review. 

 Top 10 mobile gaming app

Just three years since its launch, Fortnite has become popular receiving two nominations under the Mobile Game of the Year at the 2018 Golden Joystick Awards and Best Mobile Game at The Game Awards 2018.

Additionally, Fortnite is frequently updated with developers putting in new patches constantly, tweaking statistics for all guns while creating new weapons and grenades for users. The game is also easy to learn for amateurs. Furthermore, social media attention for Fortnite has led to a rise in its popularity leading to high grossing. Entertainers are making videos on the game and the memes for social platforms growing game’s community.

The rise of mobile gaming industry

One aspect that has led to high grossing in mobile games is the growing popularity of free mobile games funded by in-game advertising. More developers are selling ad space to monetize their games. One aspect that has emerged is rewarding video ads, which unlocks game content in exchange for watching an ad. 

Over the years, mobile gaming has now become one of the key segments of the video game industry as smartphones expand the gaming market beyond consoles and personal computers. Over the next years, smartphone gaming is set to play a major role in the gaming industry with developers putting a focus on more sophisticated gaming apps on mobile devices.

The mobile gaming industry will also keep expanding thanks to technological advancements. The continuous evolution of technology like the introduction of augmented and virtual reality and sensor technology offers gamers with an improved gaming experience with features like realistic visuals and real-time data. It is projected, that in 2020 mobile gaming will generate over $77 billion in revenue.

Published in Business

A key objective of Kenya’s agriculture growth and transformation strategy and the Big Four Agenda is increasing smallholder productivity and incomes.

The strategies also aim to enhance value-addition and agro-processing, which could create employment in agricultural value chains. The overall goal is to transform rural economies into commercially viable concerns.

But the government sometimes pursues policies that undermine these objectives.

Sorghum farming is a case in point. In Kenya, sorghum is mainly grown in areas characterised by low rainfall and high temperatures. For decades, there was little incentive to grow the crop because production costs were high, market integration low, and yields consistently low at about 0.7 tons per hectare. Ethiopia has consistently attained a national yield of 2.5 tons/ha. Farmers were unable to break even. Production was mainly for domestic consumption.

But thanks to the government policy supporting the use of sorghum for commercial beer brewing in 2004, through waiver of the excise duty, demand for sorghum increased, giving smallholder farmers an opportunity to transform their agriculture and livelihoods.

First, sorghum beer processing provided a stable market. Contracts entered between the main brewer and farmers guaranteed farmers a market and stable prices. Farmers responded by increasing their production. Some attained up to 3.3 tons/ha, which translated to an increase in incomes of about 220%.

Contract farming for sorghum beer processing expanded from three counties in 2010 to the current ten counties, with four more in the pipeline. During this period, the number of farmers has grown from 2,300 to 48,000 and farm-gate price per kilogram from 23 to 37 KES. Yield has improved due to better agronomic services and inputs provided on credit by the industry.

Second, researchers have been given an incentive to support the industry and responded by doubling the number of improved varieties from 20 in 2012 to 40 in 2017. These improved varieties are higher yielding, drought tolerant, pest and disease resistant and tailored for specific soils, rainfall and temperature.

Third, the policies on flour blending provide additional uses for sorghum in agro-processing. Despite this growth, Kenya remains a net importer of sorghum.

But the sorghum value chain, which is now years in the making, faces severe disruption. The National Treasury now seeks to reduce the excise duty waiver for beer made from locally grown sorghum, millet or cassava or any other agricultural produce from 80% to 60%. This measure is of course intended to increase tax revenue for the government.

But this policy will likely result in increased prices for the end consumers. This will in turn force the processor to cut down on production, and thereby reduce demand for the raw material. It is important to note that the main objective of changing the policy in 2004 was to fight illicit brews by making sorghum beer more affordable for people with low incomes.

Reduced demand will not only lower sorghum prices but increase costs for farmers forced to invest in storage and management of unsold produce. And more jobs will be lost along the value chain as economic activity scales down.

Learning from past policy failures

Existing evidence shows that such a policy move is counterproductive. In 2013, a similar proposal was implemented when a 50% excise duty was introduced. As a result, the price of sorghum beer increased as the added tax was passed on to consumers. The demand for sorghum plummeted as the beer processors scaled down processed volumes and also cancelled contracts for farmers.

This had a negative impact not only for farmers, but for others in the value chain, like input sellers, grain aggregators and transporters. Instead of the government raising revenue, it actually lost Ksh 2 billion in forgone tax revenue due to losses accruing to the sorghum beer processors and others in the chain.

The policy measure was rescinded in 2015.

The new regulation is ill-timed. This year, the agriculture sector has suffered several shocks. From December 2019, the desert locust invasion affected most of the arid and semi-arid lands. Also, excessive rainfall has been experienced in most parts of the country. Although the former did not pose a severe threat to sorghum farming, the latter posed a significant threat to productivity arising from flooding and waterlogging.

The COVID-19 pandemic has disrupted the economy in a way never experienced before. The demand for sorghum beer was already depressed following the closure of bars, restaurants and hotels in March 2020. Curtailing the industry during such economic shocks can only lead to worse effects for the economy.

Inconsistent policy choices

The adverse policy also contradicts other government’s policies and investments. The government, through support from development partners such as the World Bank and European Union, has also invested heavily in the sorghum and millet value chains through the projects like Kenya Climate Smart Agriculture Project, the National Agricultural and Rural Inclusive Growth Project and the Kenya Cereal Enhancement Programme. Several counties have prioritised sorghum as an essential food and commercial crop.

The president opened a Ksh 14 billion plant in Kisumu County two years ago which is serving as a key market for farmers in the western region. Another processing plant is being set up in Nakuru County. These investments have been made as a result of a stable and predictable policy environment that has existed in the past.

Across the value chain various players have invested and continue to do so with the expectation that this environment will persist and guarantee them a return on their investments. These actors include seed breeders working on sorghum varieties, seed companies, grain processors and investments in post-harvest storage and management.

The proposed regulation will be a disincentive to such investments, especially by the private sector, and possibly lead to capital flight.The Conversation

 

Timothy Njagi Njeru, Research Fellow, Tegemeo Institute, Egerton University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Published in Economy
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