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dele på twitter C-ab er avbrutt obligasjonsproblem HVORDAN DU BRUKER DENNE MAGAZINE CELL C, avbrutt en planlagt obligasjonsutstedelse på 600 millioner i offshore obligasjoner med forfall i 2021. Dette var etter at Blue Label Telecoms kunngjorde sin intensjon om å kjøpe en 45 eierandel i mobilselskapet for R5,5 milliarder kroner. Den internasjonale obligasjonen var en av betingelsene som var nødvendig for å bli møtt før aksjeavtalen kunne gå, men ble ansett unødvendig når Cell C bestemte at det ville være i stand til å oppfylle sine maksimalt tillatt lån på R8 milliarder uten det. Obligasjonen var planlagt med den tilsynelatende intensjonen om å redusere gjeldsbelastede Cell Cs netto låneopptak fra R20,7 milliarder til R8 milliarder. Til tross for at det ble rapportert som et middel til å rekapitalisere balansen, ville det nye obligasjonslånet i realiteten ikke ha redusert den samlede innflytelsen, men i stedet for å forlenge løpetidet for Cell Cs samlede gjeldsforpliktelser. Divergerende rating meninger Kanskje for tidlig, Standard Poors (SP) oppgradert Cell Cs globale kredittvurdering fra B - til B i oktober. Dette ble gjort i påvente av en betydelig gjeldsreduksjon og forbedret likviditetssituasjon, etter gjeldsfinansieringen og utvidet gjeldsløpsprofil. dele på facebook hva som skjer i kredittmarkedene Som en del av den foreslåtte eierendringen vil nye og eksisterende aksjonærer bidra med R16 milliarder i fersk egenkapital og bruttogjeld vil falle fra R23 milliarder i juni 2016 til R10 milliarder. Cell Cs sub-investment grade kredittvurdering er begrenset av en relativt svak markedsposisjon i Sør-Afrika, som er en fjern tredjedel til behemoths Vodacom og MTN. Dette negative er delvis kompensert av Cell Cs etablerte merkevare, forbedring av nettverkskvalitet og voksende kundebase. Mobiloperatøren planlegger å foreta betydelige investeringer i nettverket for å øke sin markedsandel fra 16 av mobilkunder nå til 20 i de kommende årene. Cell Cs strategi har utviklet seg til en verdi proposisjon fokusert på nettverkskvalitet og kundeservice, fra sin tidligere strategi for aggressiv prissetting for å øke markedsandelen. I motsetning til SP valgte Moodys å ta en mer konservativ tilnærming, og endret retningen av sin vurdering på Cell Cs B3-vurdering til usikker, i påvente av gjennomføringen av kapitalrekonstruksjonen. Rangeringen gjenspeiler selskapets 100-eksponering for lavvækstmiljøet i Sør-Afrika. Konkurransemessige utfordringer i markedet er historisk høye priser og lave bidrag fra høyere betalende kontraktskunder og Cell Cs overveiende mobiltilbud mot konkurrenters konvergente produktstrategier. Moodys citerer også utførselsrisiko knyttet til den nye strategien, hvis feil vil undergrave alle forsøk på å redusere innflytelse. Det økonomiske bildet Celle C har hatt tøffe få år økonomisk, selv om tidevannet ser ut til å vende mer nylig. Inntektene i regnskapsåret 2014 var R11,6 milliarder, med et netto tap på R4,9 milliarder. Inntektene økte til R13,2 milliarder i 2015, men nettotapet utvidet til R5,6 milliarder. Halvårsresultater til juni 2016 viser at omsetningen var R6,96 milliarder, opp fra R6 milliarder i samme periode i 2015. Og mer lovende var resultatet før skatt i juni 2016 en positiv R2,8 milliarder sammenlignet med tap av R1,2 milliarder i juni 2015. Når det gjelder innflytelse, forventes den justerte gjelden til EBITDA-tallet å øke fra 7,3 ganger i 2015 til 4,5 ganger i 2016 (justert gjeld inkluderer finansielle leieavtaler). Imidlertid forventes negative frie kontantstrømmer frem til 2018, på grunn av de betydelige kapitalinvesteringene som kreves for å opprettholde veksten. Transnet halvårsresultat Transnet ga sine foreløpige resultater for de seks månedene som ble avsluttet 30. september 2016. Halvårsinntektene økte med 1,2 til R32,6 milliarder, mens veksten avtar fra 6,4-tallet i samme periode i fjor. Dette var på grunn av den svake økonomien, med lav vekst og deprimerte råvarepriser dempende kundeefterspørsel. Driftsutgifter, hvorav en stor del er fastansatte og energikostnader, økte med 2,3 til R187 milliarder. Avskrivnings - og finanskostnadene økte kraftig med henholdsvis 16,3 og 23,9, noe som resulterte i at nettoresultatet falt med 43,2 til 1 milliard kroner. Transnets store kapitalutvidelsesplaner er blitt presset videre. Capex på kort sikt forventes å være reaktivt, basert på påvist kundebehov. Capex reduseres derfor med 41 til R9,4 milliarder. Den lavere kapitalutgiften resulterte også i et redusert finansieringsbehov, med en samlet gjeld på 5,1 til R127,7 milliarder. Ny gjeld på R11,8 milliarder ble økt, og av dette var mindre enn R400 millioner fra de børsnoterte obligasjonene, da de månedlige auksjonene ble redusert. Dette er overraskende, ettersom spredninger på Transnets-obligasjoner har økt det siste året blant negative følelser om SOE og generelle markedsforhold. Londa Nxumalo CA (SA) er kredittanalytiker CIG er en av de få selskapene som har det bra i industriparken. Den har nylig sluppet sterke årlige resultater: Inntekter var opp 26 til R4,5 billon (FY15: R3,6 milliarder kroner) og overskuddsveksten klatret 16 til 255,3cshare (FY15: 220.7cshare). Likevel har aksjene mistet 32 ​​de siste 12 månedene. Det er vanskelig å fastslå hva som kan kjøre denne bearish oppførselen, men vi mistenker at følgende kan være mulige årsaker. Dårlig kontant konvertering. Selv om CIGs veksthistorie er imponerende, er den dårlige kontokonverteringen en grunn til bekymring. Mens inntektene har vokst til en gjennomsnittlig verdi på 36 år siden 2011, blir mye av det ikke omgjort til kontanter ettersom skyldnere har stått opp og vokst til 93 om året. Dette er delvis fordi prosjektene har blitt større og tar lengre tid å fullføre. Uten stor lindring fra kreditorene blir det opprettet likviditetsbrister, noe som tvinger konsernet til å låne for å finansiere virksomheten. Selv om ledelsen sier at selskapet har tilstrekkelige driftskapitalfasiliteter fra bankene for å finansiere eventuelle kortsiktige likviditetskrav, er det absolutt bekymringsfullt, spesielt for investorer som kan forvente et utbytte. Prosjektbasert forretningsmodell. I motsetning til sine jevnaldrende (Invicta, Hudaco og Barloworld) som selger en stor del av sine produkter til ettermarkedet (vedlikehold) der inntjeningen sannsynligvis vil være tilbakevendende på grunn av kortere utskifting, er Concos forretningsmodell i stor grad basert på bestillingsboken. Det må derfor fortsette å vinne nye kontrakter for å erstatte modne. Denne modellen har en tendens til å ha en positiv effekt på CIGs aksjekurs når investorer føler seg positive om potensialene til kraftbransjen. Gitt den forventede nedgangen i SA-kraften, mistenker vi imidlertid at noen investorer kan begynne å redusere sine beholdninger i selskapet, forutsatt nedgang i ordreboken. CIG flytter imidlertid inn i ettermarkedet, etter å ha opprettet en divisjon for å målrette slikt arbeid. Usikkerhet om SAs fornybare energiprogram. CIG har i løpet av de siste årene hatt stor fordel av det uavhengige kraftproducentprogrammet (REIPPP). Nesten en tredjedel av Concos-inntektene i FY14 og FY15 kom fra fornybare energiprosjekter. Eskom har imidlertid tvunget på videreføring av fornybarhetsprogrammet. Dette har truffet Concos fornybar energi bestillingsbok, som gikk ned til bare R400 millioner sammenlignet med R1,1 milliarder i fjor. Potensiell fortynning fra fortrinnsrettsemisjonen. Investorer kan være prissetting i en potensiell inntjeningstynning fra gruppens planlagte rettighetsemisjon. Rettighetsemisjonen tar sikte på å øke R750 millioner som kreves for oppkjøpet av Conlog (diskutert nedenfor). Det vil se selskapet utstede 39 millioner aksjer. Gitt at spørsmålet vil føre til en betydelig økning i antall utstedte aksjer, synes det rimelig å forvente noe fortynning. Imidlertid viser ledelsens beregninger at oppkjøpet vil være verdiøkende. Virksomhet: CIG er en diversifisert infrastrukturgruppe med bred rekkevidde over hele Afrika. Operasjoner spenner fra installasjon og vedlikehold av høyspennings elektrisk infrastruktur til avfallshåndteringstjenester og levering av bygningsmaterialer. Den opererer gjennom sine datterselskaper: Conco, West End Claybrick, Drift Supers og Angola Environmental Servicos Limitada. Opplysninger: Analytikeren har ingen økonomisk eksponering for instrumentet som diskuteres. Synspunktet representerer hans sanne syn. For Intellidexs fullstendig ansvarsfraskrivelse, metoder og definisjoner, klikk her. dele på facebook HVORDAN DU BRUKER DENNE MAGAZINE-oppkjøpet tilbyr løfte om CIG Conlog kan lette kontantstrømspørsmål Orin tambo, cfa intellidex Driftsmiljø utsatt for interne og eksterne støt Finansieringsutfordringer ved Eskom kan se forsinkelser eller nedskalering av prosjekter Forsinkelse i fortsettelse av fornybar energi Program forårsaket av Eskoms Sterk ordrebok med god geografisk balanse Økt eksponering for vekstsektorer og geografisk diversifisering gir pute mot deprimert SA økonomi Fokus på å øke sin drift og vedlikeholdsarbeid vil gi betydelig livrenteinntekt. Til tross for de ovennevnte problemene, tyder våre risikojusterte verdivurderinger på at aksjen fortjener en kjøpsvurdering. CIG skjermer godt på verdi og vekst. Dens verdien attributter er attraktive: det er på en forward-pris: inntjening flere av 8,5 og en priceearnings til vekst ratio på 0,5, støttet av en god underlag av eiendeler. Vi oppfordres av CIGs oppkjøpsstrategi til å målrette selskaper som er svært kontantgenerative, har potensial til å gi livrenteinntekter og vil diversifisere virksomheten. I 2012 kjøpte selskapet 31 aksjer i det angolanske selskapet AES, som er involvert i innsamling, gjenvinning og avhending av oljebasert avfall opprettet under boreprosessen. Mer nylig kjøpte Conlog som design, produserer, markedsfører og distribuerer forhåndsbetalte og smarte elektroniske måleinstrumenter og løsninger. Disse oppkjøpene reduserer noen av problemene vi reiste over. AES og Conlog har forskjellige driftsmodeller og er utsatt for vekstdrivere som er forskjellig fra de som påvirker Conco. Enda viktigere er at Conlog har et høyt kontantomregningsforhold og er lett på arbeidskapital og kapitalutgifter, som vi tror vil lindre de arbeidende kontantstrømproblemer. dele på twitter Neste investeringsgrense: Vannklikk-knappen for å spille av videoer dele på twitter Finn ut hva Fred Platt (CEO, Accentuate), Warren Hurter (direktør, FCP Energy) og Amy Jones (direktør, Truter Jones Inc) måtte si om Betydningen av å forbedre infrastrukturen i Sør-Afrika. dele på facebook Det er anslått at R180 milliarder vil bli investert i energiinfrastrukturprosjekter i Sør-Afrika de neste tre årene, mens ytterligere R250 milliarder vil bli gjort tilgjengelig for investeringer i vei - og transportinfrastruktur. Det er en klar investerings mulighet for de som er i stand til å kapitalisere på disse investeringene. Moneyweb og Financial Services-gruppen Nedbank arrangerte en rundpakke med C-suite i forrige måned, med sikte på å stimulere diskusjoner på høyt nivå om investeringsmulighetene i sektoren og hvordan kapitalen skal distribueres. andel på twitter Afrimat-aksjekurs (gjenopptatt) Inntekter er stort sett transaksjonsmessige og sårbare for konjunkturmarkeder Lider av kjente kostnader for energi og arbeidsinngangskostnader Arbeidsintensiv industri, sårbar for industrielle tiltak Sterk ordrebeholdning med god geografisk balanse Økt eksponering for vekstsektorer og geografisk diversifisering gir pute mot deprimert SA økonomi Fokus på å øke sin drift og vedlikeholdsarbeid vil gi betydelig annuitetsinntekt Diversifisering til stort sett uutnyttet marked for industrimineraler Produkter med knapphetskvalitet kan opprettholde inntjening i deprimert miljø Agil forretningsmodell gjør det mulig å etablere operasjoner raskt på prosjektsteder Sunn kontantstrøm og sterk balanse HVORDAN DU BRUKER DENNE MAGAZINEN Afrimat er en av de mest konsistente småkapslingsdiskene på bourse. Den har økt sin inntjening i gjennomsnitt på 22 år i løpet av de siste fem årene og erklært utbytte hvert sjette år siden notering for ti år siden. Mens vi forventer at konsernet fortsetter å legge ut gode vekststall og betale et godt utbytte, viser våre verdivurderinger at etter en 28 rally siden vårt kjøpssamtal i mai, handler aksjene nå nærmere våre estimater av virkelig verdi. De nylig utgitte resultatene for halvårsskiftet til slutten av august viser at overskuddssultatet hoppet over 25, omregnet til overskudd per effektivitetsforbedringsinitiativ, som økte resultatveksten per aksje på 95,2c (1H16: 76c). Veksten ble drevet av diversifiseringsstrategien, samt kostnadsreduksjoner og overgår veksten i omsetningen. Ledelsen rapporterer at alle prosessanlegg er fullt operative og arbeidsforholdene fortsatt er tilfredsstillende. Et utbytte på 20cshare (1H16: 16cshare) ble erklært. Forskjellige appell av Afrimat Driftsmiljø utsatt for interne og eksterne støt Finansiering av utfordringer på Eskom kan se forsinkelser eller nedskalering av prosjekter Forsinkelse i fortsettelse av fornybar energi program forårsaket av Eskoms Orin Tambo, CFA Intellidex Vi verdsetter Afrimat ved R28.95share, som faller i vår vaktregion. Våre verdivurderinger er basert på følgende utsikt: Sterk omsetningsvekst. Vi forventer at Afrimats topplinjevekst skal drives av høyere salgsvolum, et bredere produktspekter og prisøkning. Sterke offentlige utgifter på landsbygda på infrastruktur, samt på andre små infrastrukturprosjekter, som for eksempel vanndistribusjonssystemer og sanitære prosjekter, vil forbli nøkkelen til å drive etterspørselen etter gruppens byggematerialer. Det vil bli supplert av flere greenfield-prosjekter som er igangsatt rundt om i landet og i Mosambik, og ved bidrag fra ulike oppkjøp. Driftsmargin utvidelse. Afrimat utvidet sin driftsmargin fra ca 12 i 2012 til 18 år. Dette har vært den største drivkraften i resultatveksten. Nøkkelen til denne forbedringen har vært en endring i produktmikset som har avhendet marginale virksomheter, samtidig som man får mer verdifulle eiendeler, noe som resulterer i forbedret effektivitet og kostnadsreduksjoner. Vi tror at flere fordeler fra disse tiltakene fremdeles skal realiseres. Afrimat har også kjøpt virksomheter de siste månedene. Da den integrerer disse og benytter den ekstra kapasiteten, forventer vi at driftsresultatet vil vokse fremover omvekstveksten, noe som vil se at driftsmarginen øker til rundt 18,7 på mellomlang og lang sikt. Oppkjøp. Vi forventer at oppkjøp vil fortsette å spille en viktig rolle i Afrimats vekst som de har gjort de siste årene. Tidligere oppkjøp medførte produktdiversitet, skapte nye inntektsmuligheter og økt lønnsomhet. Afrimat er nå en diversifisert virksomhet som leverer industrisektoren med metallurgisk dolomitt og kvartsitt (til kunder som ArcelorMittal), silisiumdioksyd (glassmakere), keramikk og kalk. Det har også nylig kommet inn i jernmalmgruvemarkedet, som sannsynligvis vil bringe inn utenlandsk valuta. Gitt Afrimats sterke balanse og svært kontantgenererende operasjoner, forventer vi at det skal inngå flere oppkjøp. Nettoeffekten av de ovennevnte faktorene skal oversettes til 14 til 16 årlig inntjeningsvekst de neste fire årene noe under vekstraten de siste årene, men fortsatt svært respektabel. En nøkkelfaktor som gir Afrimat en kant over sine konkurrenter er posisjoneringen i forhold til prosjektoperasjoner. Aggregater er tunge, så plassering i nærheten av brukspunkter er nøkkelen. Med mer enn 35 åpne gruver i hele SA, kan Afrimat produsere og levere til lavere transportkostnader enn mange andre spillere. Det har også introdusert mobilt utstyr som gjør det mulig å utnytte muligheter som og hvor de oppstår. Flere produktlinjer betyr mange kunder. Virksomhet: Afrimat er et gruveselskap med åpen pit for industrielle mineraler. Det leverer et bredt spekter av byggematerialer, alt fra aggregater og betongprodukter til ferdigblanding og industrimineraler. Det gir også boring og sprengningsløsninger for bygg - og junior gruveindustrien. Opplysninger: Analytikeren har ingen økonomisk eksponering for instrumentet som diskuteres. Synspunktet representerer hans sanne syn. For Intellidexs fullstendig ansvarsfraskrivelse, metoder og definisjoner, klikk her. dele på facebook HVORDAN DU BRUKER DENNE MAGAZINEN Hva vi liker om selskapet Godt posisjonert innen en bransje med sterke grunnleggende En sofistikert infrastruktur for å imøtekomme medievekst i både detaljhandel og engrosvirksomhet Bevist økonomisk beregning og track record Meget erfaren, grunnleggerledet Ledelsespark Risikofaktorer Forretninger er avhengig av bildet og omdømmet til merkevaren. Enhver manglende opprettholdelse av gunstig merkevarekjennelse kan ha en negativ innvirkning på inntjeningen. Veldig konkurransedyktig industri kan gjøre det vanskelig å oppfylle vekstmålene. Helseindustrien er svært regulert. Manglende overholdelse eller regulatoriske endringer kan ha en negativ innvirkning på inntjeningsandelen på facebook Dis-Chem: Sunn vekstutsikter Virksomhetens art: Dis-Chem driver butikkapotek, men bortsett fra vanlige forbutikkvarer som personlig pleie, ernæring og babypleie produkter, det lager også konditorier, tørrvarer, husholdningsartikler og andre tilleggsprodukter. Det har også en engrosvirksomhet som serverer tredjeparts apotekforhandlere og egne apotek. Til tross for at den er ny på børsen, er Dis-Chem trolig den største aktøren innen detaljhandelapoteket, og står for om lag en femtedel av det markedet. Den nærmeste konkurrenten er klikk. Opplysninger: Analytikeren har ingen økonomisk eksponering for instrumentet som diskuteres. Synspunktet representerer hans sanne syn. For Intellidexs fullstendig ansvarsfraskrivelse, metoder og definisjoner, klikk her. andel på twitter Den mye forventede noteringen av Dis-Chem fant sted fredag ​​18. november. Gruppen åpnet handel på R23.36share, men prisen falt deretter til R20,55, og avregnet til R21,48 når markedene ble avsluttet. Nær 28 millioner aksjer verdt over R600m handlet på debut dagen. Den nåværende prisen på R21.48share setter Dis-Chem til en pris: inntjeningsgrad (PE) på 28,1, som vi synes er kostbar til tross for vekstutsikter selskapet tilbyr. Dens nærmeste konkurrent, Clicks, som tilbyr lignende vekstutsikter, har en PE på 26. Vi tror Dischem bør også verdsettes på rundt det nivået. Dis-Chem tilbyr tydeligvis investorer eksponering for en eksepsjonell virksomhet som har hatt bemerkelsesverdig vekst gjennom årene. Den har tredoblet sin butikkbase siden 2008. Inntekter og resultat før rentebeskatning, avskrivninger (Ebitda) har vokst med en sammensatt rente på henholdsvis 20,8 og 21,6 de siste tre årene. Vi forventer at Dis-Chem skal opprettholde denne fantastiske veksten. Ledelsen har lagt fram en vekstplan for å doble fotavtrykket de neste fem til åtte årene. Nye butikkåpninger vil få betydelig innvirkning på omsetning, driftsresultat og kontantstrøm. Da det øker butikken sin, er det sannsynlig å øke gebyrbaserte inntekter ved hjelp av dispenserings - og logistikkavgiftene det mottar fra narkotikaprodusenter for å distribuere sine produkter til detaljhandelapotekene. Det vil sammen med kostnadsutvanningene som kommer fra de modne butikker som ble åpnet de siste tre årene, drive overskuddsmarginer. Tretti butikker, en tredjedel av eksisterende butikker, ble åpnet de siste tre årene. Vekststrategi og innvirkning på inntjeningen I sentrum av Dis-chems er vekststrategi sitt ambisiøse mål om å åpne 100 butikker de neste fem til åtte årene. Basert på dette målet må gruppen åpne 13 til 20 butikker i året. Dette er allerede på vei siden ledelsen har sikret 29 leieavtaler for nye butikker i løpet av de neste 18 månedene. Utvidelsen skal være todelt: Å åpne nye apoteker og konvertere eksisterende uavhengige apotek til Dis-Chem butikker. Dis-Chem eier også en grossistvirksomhet som, til tross for å være en liten bidragsyter nå, er klar til å utvide. Målet er å fange forsyningskjedene til uavhengige apotek og utvide til distribusjonsvirksomheten, hvorved det ville tjene både grossister og forhandlere. Disse tiltakene vil få betydelig innvirkning på Dis-Chems lønnsomhet. Som det øker butikken sin, vil den kunne utnytte den eksisterende hovedkontorets kostnadsbase og forbedre fortjenestemarginene. DisChem har de siste årene gjort betydelige investeringer i hovedkontoret, som nå har en stab på 651. Ledelsen mener at hovedkontorets kostnadsgrunnlag på rundt R316m i året er tilstrekkelig for å imøtekomme sin langsiktige vekst. Dette betyr at det kan doble sine butikker uten noen betydelig økning i faste kostnader, en faktor som vi forventer vil utvide marginer. Ledelsen sier at nye butikker vanligvis gjenoppretter alle kostnader knyttet til åpningen innen 18 måneder etter handel, og når løpetiden innen fire år. Ved forfall forventes hver butikk på 1800m2 å ha inntekter på opptil R198 millioner og Ebitda på rundt R15 millioner, ifølge våre beregninger. Dette innebærer at 20 nye butikkene åpnes, vil på forfall ha potensial til å legge mellom R2,2 milliarder og R4 milliarder til inntekter. Etter å ha vurdert de ulike forfallstidene for eksisterende butikker og den planlagte ekspansjonsstrategien, tror vi at gjennomsnittlig vekst i inntekter på 21 år over de neste fem årene er oppnåelig. Hvordan vil Dis-Chem finansiere veksten Dis-Chems planlagte butikker vil ha gulvstørrelser fra 1000m2 til 1800m2. Den store butikken vil koste rundt R22 millioner, inkludert kapitalutgifter og arbeidskapital. Forutsatt at gruppen ønsker å nå sitt mål på kortest mulig tid (fem år), må den tilbringe rundt R240 millioner - R400 millioner på nye butikker hvert år. I tillegg må det oppusses sine eldre butikker. Dis-Chem har en tendens til å oppusse sine eksisterende butikker hvert syv år til en pris av 40 av den opprinnelige investeringen. Vi ser på utgifter i området rundt R500 millioner i året på butikkene. Dis-Chem er svært kontantgenererende, med tilstrekkelig kontanter fra drift for å finansiere hoveddelen av ekspansjonsplanen fra interne ressurser. Selv om gruppens kontantstrømoppstilling viser at operasjonelle aktiviteter har blødt kontant i løpet av to og et halvt år til slutten av august, tror vi at det er god plass til å reversere trenden. Dis-Chems utbytteregning på 2,1 milliarder kroner over den perioden spiste opp om lag 90 av kontanter generert fra handelsaktiviteter. Dette, sammen med det som ser ut til å være et lønnsom arbeidskapitalstyringssystem, forårsaket nettoutstrømningen. Den første muligheten vil åpenbart være å kutte utbytteutbetalinger. Ledelsen indikerer at det vil begrense utbetalingsforholdet til 40. Basert på vårt inntjeningsestimat på R891 millioner for FY18, vil om lag R500 millioner bli deklarert som utbytte, noe som er langt lavere enn R1,1 milliarder betalt i FY16 og R890 millioner som allerede er betalt i 1H17. Det vil frigjøre mye penger for å kanalisere mot butikkutvidelser. Verdivurdering Vår diskonterte kontantstrømsmodell viser Dis-Chem aksjer er verdt R19.11share. Vi ser ingen kjøpsmulighet til dagens pris. Men dunkel verdsettelse betyr at det ikke er noe kjøp Orin Tambo, CFA Intellidex Dynamique-modellen, bare NEDC kombinert drivstoffsyklus Ts og Cs gjelder Klikk her for å spille av video Rollover bildene for å forstørre Den nye RENAULT Kwid lar deg leve for mer utforsking, mer spenning og flere opplevelser. Så hvorfor ikke gå om det i stil Med sin crossover look, er du bundet til å snu hodene underveis. Den 7 berøringsskjermnavigasjonen som er komplett med et multimediesystem lar deg lytte til favorittsporene dine direkte fra telefonen. I tillegg gir RENAULT Kwid deg plass til å være akkurat som du vil være, hvor du vil være, med sin 300 l oppstartsplass og komfortabel hytte. plass til å være akkurat som du vil være, hvor du vil være, med sitt 300 l oppstartsrom og komfortabel hytte. Med sin SUV-inspirerte design, tømmer New RENAULT Kwid også boksene med en jevn og økonomisk kjøring med elektrisk servostyring, førerens airbag og drivstofforbruk på 4,7l100km. Live for mer i New RENAULT Kwid, fra bare R1 999 per måned. Invicta Aksjekurs Invicta har imponert på bunnlinjen med dobbeltsifret vekst i delårsperioden til slutten av september, og leverer på et av løftene i begynnelsen av FY17 for å øke kostnadskontrollen. Økningen på topplinjen er imidlertid fortsatt en utfordring, men den er fortsatt i enkelte siffer, men bedre enn i fjor. Invictas høy eksponering for SA stillestående økonomi hvor det genererer mer enn tre fjerdedeler av inntekter, spesielt de sykliske sektorer av gruvedrift, jordbruk og konstruksjon, er en utfordring. Det er oppmuntrende at ledelsen har levert på noen av målsettingene som ble beskrevet i begynnelsen av FY17. I tillegg til en skarp kostnadsinneslutning har den gjenvunnet arbeidskapital i sin virksomhet, og genererer positive driftstrømmer for første gang på mer enn to år. Men denne type inntjeningsvekst er ikke bærekraftig så lenge tosifret omsetningsvekst forblir unnvikende. Nettoskuldsvingningsgraden forblir høy på over 115, men er en forbedring fra forrige årsskift 135 og ble redusert av forbedrede kontantstrømmer som gjorde Invicta i stand til å redusere en liten del av sin asiatiske gjeld. Utsikter Gitt hovedproduktet til varene levert av konsernet, er utsikterna fortsatt usikre. Imidlertid er det tegn på at verdens råvaremarkeder har bunnet mens de siste regnene har forbedret utsiktene for landbrukssektoren. Ledelsen sier at den vil fortsette å arbeide med å styrke interne effektiviteter og forbedre kontantgenerering. I den forbindelse startet den en omvendt strategi for sin asiatiske arm, Kian Ann, for å tilpasse virksomheten til lavere aktivitetsnivå og redusere arbeidskapital. Dette vil trolig se ytterligere gjenoppretting av operasjonelle kontantstrømmer. For å forbedre salget er det iverksatt tiltak for å utvide distribusjonsfotavtrykket til nye områder. I SA har bygging av et utvidet forsamlingsanlegg startet i Camperdown, KwaZulu-Natal. Og BMGs verdensdistribusjonsanlegg i Johannesburg forventes å åpne i begynnelsen av FY18, noe som vil gi betydelige kostnadsbesparelser og effektiviseringer. I begynnelsen av FY17-ledelsen ble det utarbeidet flere mål, og det har gjort gode på å redusere kostnadene og redusere arbeidskapitalen. Imidlertid forblir inntektsverdien under pari. Videre har det langsiktige målsetninger om å nå omsetning på rundt 25 millioner i 2020, med omlag halvparten av det som genereres utenfor SA. Den tidligere innebærer at Invicta må øke omsetningen ved en sammensatt årlig vekst på 30 på kort til mellomlang sikt, og dette er vanskelig å svelge gitt den nåværende veksten på bare 8. Anskaffelser kan gi mangelen Invicta handler under en advarsel uttalelse. Og selv om den høyt balanserte balansen kan være en hindring, har Invicta forbedret kontantposisjonen betydelig. Det må også gå til aksjonærer for ytterligere kapital. Det vil fortynne per aksje beregninger. Imidlertid, støttet av sin ankeraksjonær, Christo Wiese, er det mulig. Resultatrapportering Overskuddsinntekter ble drevet av ulike kostnadsinntaksmål og justering av fortjeneste fra et eiendomsalg i basisperioden. Hvis effekten av engangsgevinst ved salg av eiendom i tidligere periode fjernes (for beregning av overskudd), økte driftsresultatet 22. Oppkjøp bidro med R19 millioner eller 4 til veksten i driftsresultatet, med balansen i Veksten kommer fra bruttomarginadministrasjon og kostnadsinneslutning. Kapitalutstyrssegmentet økte omsetningen 4 til R2,38 milliarder og driftsresultatet økte 21 til R219 millioner. Driftsmarginen ble forbedret til 9,2 fra 7,9. Selv om omsetningen i den lokale virksomheten var flatt, økte driftsresultatet 36 på grunn av kostnadsreduksjonen. Arbeidskapitalen ble også redusert og kontantgenerert fra driften forbedret. Men svake økonomiske forhold i Asia førte til at Kian Ann-ytelsen falt ytterligere. Divisjonen for ingeniørløsninger økte omsetningen med 13 til R2,35 milliarder og driftsresultatet økte 24 til R241 mill., Mens oppkjøpene økte salgsomsetningen og R21million (11) til driftsresultatveksten. Driftsmarginen ble forbedret til 10,3 fra 9,3. På samme måte ble operativ kontantstrøm forbedret på grunn av optimal driftskapital. Segmentet bygningsmaterialer økte omsetningen 9 til R1,02 milliarder, mens driftsresultatet var flatt på R45 millioner. Driftsmarginen gikk ned til 4,4 fra 4,9 - langt utenfor ledelsens mål på 6. Investeringsuttalelse Vi har tidligere hatt en selgesamtale på disken, men aksjekursen steg etter at den utgav disse midtveisresultatene på grunn av en overraskende økning i overskudd. Etter å ha oppdatert verdsettelsesmodellen i lys av de bedre enn forventede foreløpige resultatene, synes telleren å være handel innenfor sin egenverdi. Aksjekursen kan få et løft fra mulige bedriftsaksjoner ettersom ledelsen nylig har utstedt varsel. Selv om den har stor gjeld sitter Invicta på R957 millioner i kontanter mer enn det dobbelte beløpet i 1H16. Telleren kan også fungere bedre ved årsskiftet, da konsernet vil sannsynliggjøre sterke bunnlinjer for hele året på grunn av kostnadsstyringsforanstaltninger som har resultert i utvidelse av fortjenestemarginalen. Vi endrer vår samtale for å holde fra å selge. Høy gjeldsnivå Svak lokal og global utsikt Begrenset kapitalutgifter fra sentrale kunder Virksomhet: Invicta Holdings Ltd er et investeringsholdingselskap med tre hoved datterselskaper: Bearing Man Group (BMG), Capital Equipment Group (CEG) og Building Supply Group (BSG) ). Disse opererer mer enn et dusin divisjoner involvert i import og distribusjon av engineering forbruksvarer, kapital utstyr og byggematerialer. Invicta overtok i 2013 Singapores Kian Ann Engineering for å lede selskapets ekspansjon i sørøst-Asia. Opplysninger: Analytikeren har ingen økonomisk eksponering for instrumentet som diskuteres. Synspunktet representerer hans sanne syn. For Intellidexs fullstendig ansvarsfraskrivelse, metoder og definisjoner, klikk her. dele på facebook Kostnadsbegrensning tiltak buttressing fortjenestemarginaler Forbedring av arbeidskapital og kontantposisjon Samfunnsaksjon i offing Forbedre prospekter for landbrukssektoren HVORDAN DU BRUKER DENNE MAGAZINE Invicta: Holdes gissel etter lav økonomisk vekst Kostnadsbegrensning økning i inntjening i drift Phibion ​​Makuwerere Intellidex Invicta har imponert på bunnlinjen med dobbeltsifret vekst i delårsperioden til slutten av september, og leverte på et av sine løfter i begynnelsen av FY17 for å øke kostnadskontrollen. Økningen på topplinjen er imidlertid fortsatt en utfordring, men den er fortsatt i enkelte siffer, men bedre enn i fjor. Invictas høy eksponering for SA stillestående økonomi hvor det genererer mer enn tre fjerdedeler av inntekter, spesielt de sykliske sektorer av gruvedrift, jordbruk og konstruksjon, er en utfordring. It is encouraging that management has delivered on some of the objectives it set out at the beginning of FY17. Further to astute cost-containment, it has recovered working capital in its operations, generating positive operating cash flows for the first time in more than two years. But this type of earnings growth is not sustainable as long as double-digit revenue growth remains elusive. The net debt-to-equity ratio remains high at more than 115, but its an improvement from the previous year-ends 135 and was brought down by improved cash flows that enabled Invicta to reduce a small portion of its Asian debt. share on twitter HOW TO USE THIS MAGazine At the end of 2001, more than four times as much money was invested in local equity unit trusts as was held in multi-asset funds. Over the past 15 years however, this has reversed dramatically. There is now more than twice as much money held in balanced funds as there is in pure equity unit portfolios. Balanced funds have quite clearly become the preferred vehicle for South African investors. More specifically, multi-asset high-equity funds have become easily the largest local unit trust category. At the end of September, the Association for Savings and Investment South Africa reported that R428.7 billion was invested in these mandates, which is nearly half of all the money held in South African balanced funds. A large part of the reason that these funds have become so popular, is that the best of them have been able to produce equity-like returns, at much lower risk. Since most of them comply with Regulation 28 of the Pension Funds Act, they can also be used in retirement-funding vehicles such as retirement annuities. However, the popularity of these funds has also meant that more and more managers have wanted to compete in this space. However, the popularity of these funds has also meant that more and more managers have wanted to compete in this space. There are now over 200 multi-asset high equity unit trusts, making it rather difficult for investors to identify the ones appropriate for their needs. While past performance should never be used as the only indicator of a funds quality, it is a good place to start. And it is therefore worth looking at which of these unit trusts have produced the best longer-term returns. Taking a longer-term view, the table to the right shows the top ten funds in this category over the past ten years. There are only 41 multi-asset high-equity funds with track records this long. This excludes five of the top performers over five years the Truffle, Rezco Managed Plus, Nedgroup Investments, Personal Trust and Plexus unit trusts. Over this longer period, there are five funds with records better than the Alsi. At the same time last year, there was only one. That was the Rezco Value Trend Fund, which continues to be the top performer in this category over the long term. It also stands out for delivering annualised returns, more than 1.5 better than any of its peers. It is also notable that the Allan Gray, Coronation and Investec funds are all near the top of this list. These are three of the four largest funds in this category, which together hold 47.5 of all the money invested in multi-asset high-equity portfolios. This suggests that the average investor has done pretty well from investing in a balanced mandate. share on facebook The favourite favourites share on twitter The first thing worth noting is that the top 14 funds all delivered returns ahead of the JSE All Share Index (Alsi). This is up from just three funds that had out-performed the market over five years at the same time last year. To a large extent, this has to do with the relatively poor performance of the local equity market over the past 36 months. These balanced funds have done better than South African equities because they have been able to find alternative sources of return, particularly offshore. However, investors should also be aware that these 14 funds that beat the index, represent only around 17 of the unit trusts in this category with track records this long. The average fund has produced returns significantly below those of the equity market. This highlights just how difficult it is to select a manager who will be able to produce this kind of performance, as it is very difficult to tell beforehand who the winning managers will be. That said, the Truffle MET Balanced Fund stands out ahead of all its peers in this category over this period. It currently allocates only 43 of its portfolio to South African-listed shares, with 23 held offshore and over 6 in listed property. What is also remarkable is that it has delivered these strong five-year returns, even though it has been negative over the last 12 months. The Rezco Value Trend Fund has been a top-performer in this category for many years and continues to produce outstanding performance. At the moment it is also one of the most conservatively-positioned funds in its class, with just 20 allocated to local equity and nearly 60 of its portfolio in cash. Even so, it has also been negative over the last year, which illustrates just how difficult the current investment environment is. Another fund worth highlighting is the Nedgroup Investments Core Diversified Fund, which is a passive balanced fund. In other words, it only uses index-tracking products for its underlying exposures and therefore comes at low cost. It is exceptional that this strategy has delivered returns not only better than the Alsi, but better than 85 of the funds in its category. Taking a longer-term view, the table below shows the top ten funds in this category over the past ten years. SAs top multi-asset high equity funds Embracing both the letter and spirit of transformation successfully lands AB InBev - SABMiller combination in South Africa Anheuser-Busch InBevs (AB InBev) GBP79 billion combination with SABMiller represents the largest in the global beverages industry. It is also the largest foreign direct investment into South Africa to date. South Africa was identified as one of the four geographies in which regulatory approval was a pre-condition to the closure of the global transaction. South Africa contributed USD1 billion of SABMillers EBITA, representing approximately 15 of the companys group EBITA. South Africas complex economic transformation legislation, developed in support of the governments broader national development goals, required advisors experienced in South African legislation and conversant with national development principles. Central to this was established relationships with government and key labour and supplier stakeholders, says Frad Shoko, Head, Global Advisory at Standard Bank. These considerations saw AB InBev appoint Standard Bank as financial adviser in relation to Africa matters, joint transaction sponsor in respect of the inward listing on the JSE and listing of AB InBev, and foreign exchange provider on AB InBevs business combination with SABMiller. Regulatory approval was obtained following extensive consultative stakeholder engagement. The South African pre-conditions for the merger were twofold, namely South African Competition Tribunal approval, and receipt of exchange control approval from the Financial Surveillance department of the South African Reserve Bank. In practical terms this meant securing legislative approval from the South African Competition Tribunal and the South African Reserve Bank. In philosophical terms, however, AB InBev was required to understand and buy-in to a higher vision of the South African market. AB InBev consulted closely with a number of stakeholders, including various government ministries to understand and support - their visions for the development of the South African economy. By demonstrating their commitment to work within both the letter and the spirit of South Africas economic transformation agenda, AB InBev quickly secured Competition Tribunal approval. The listing on the JSE was carried out by way of a fast-track listing process available to corporates already listed on major exchanges elsewhere in the world. The process took 21 days from application to listing, a record turnaround time for the JSE. The process also involved ground breaking mechanisms to achieve fungibility and liquidity between Euronext and the JSE, explains Mr Shoko. The record time in which approval was granted, had a lot to do with how, supported by Standard Bank, AB InBevs supply chain and procurement teams developed a transformative supplier programme. This included a ZAR1 billion fund to support small-holder farmers while promoting enterprise development, local manufacturing, exports and jobs. The programme also included measures to reduce the harmful use of alcohol while promoting green and water-saving technologies. Each element of this far-reaching package of commitments required an understanding of the South African operating and regulatory environment, as well as insight into the objectives and priorities of key stakeholders in the country, adds Mr Shoko. Characterised as ground-breaking by the South African Government, AB InBevs commitment to the broader national development goals of South Africas transformation programme provides a benchmark to global businesses seeking to invest in South Africa. They also demonstrate the importance of a thorough approach to the regulatory processes and stakeholder engagement. Standard Bank is also present and fluent within all 15 African legislative environments which were pertinent to AB InBevs combination with SABMiller. From the outset AB InBev made it clear that Africa would play a vital role in the combined group. This, combined with the philosophical understanding and technical ability to land a transaction of this size in the South African market, made Standard Bank the obvious choice as an advisor for the African leg of this ground-breaking global beverages combination, says Mr Shoko. HOW TO USE THIS MAGazine Financial services companies on the JSE have been through a torrid time over the past 12 months. They have often born the brunt of South Africas political uncertainty. Nenegate in particular, saw a sharp sell off in these shares in December last year. Concerns around a potential credit downgrade also continue to weigh them down. While the FTSEJSE All Share Index is more or less flat over the past 12 months, the Financial 15 Index is down around 10. This is some indication of how the market views these companies at the moment. Managers of financial equity funds have therefore had a challenging time in putting their portfolios together. They have had to be very conscious of managing risk in this environment. The tables on the following page show which counters three financial sector fund managers have bought into, and which they sold out of, over the 12 months to the end of September 2016. The share must have had a weighting of more than 1 to be considered. The tables also show any notable and substantial changes to positions within the funds. The Stanlib Fund was the most active of the three, in terms of buying into new positions. It saw value in a range of counters, from the JSE to long-term insurer Alexander Forbes and asset manager Coronation. Coronation has been generally out of favour among investors as the markets have not been supportive of the business over the last two years. However, the share has shown recent signs of recovery. Although it is still below the highs it reached towards the end of 2014, it is up more than 40 for the year to date. Like the SIM Fund, Stanlib also holds a generous portion of its portfolio in listed real estate. Apart from buying into Capital Counties, the fund also has exposure to Growthpoint, Redefine and Resilient, with propertys total weight in the fund being over 10. share on twitter share on facebook The SIM fund managers have made a clear decision to increase their exposure to listed property. The fund only had minimal exposure to real estate counters in September 2015, but a year later it had grown to close to 10 of its portfolio. A good chunk of this was offshore, through the likes of Intu, Capital Counties and Investec Australia. The fund also bought heavily into RMB Holdings, which has property exposure through its interest in Atterbury. Although Discovery was the only stock they sold out of, the managers also substantially decreased exposure to a number of companies with a primarily local focus the likes of Sanlam, Nedbank, JSE and PSG. The fund also offloaded most of its holding in FirstRand, but this was offset through its buying of RMB Holdings at the same time. FirstRand is still by far the largest part of RMB Holdings portfolio. What top financial sector fund managers have been buying and selling HOW TO USE THIS MAGazine The Christmas decorations have gone up and Santa Claus is coming to town (or at least shopping malls are going to town with the tune). mind, the bank has focused on building targeted solutions for specific professions. For instance, it has built Mercantile Online Invest, which simplifies the management of trust accounts for lawyers, estate agents and forex intermediaries. This has seen deposits increase by R1.9 billion over the past 18 months. This month, Mercantile will be launching a unique offering for professionals initially focused on the medical sector - whereby the bank will help chiropractors, dentists, physiotherapists and others with the financing necessary to establish their practice. This offering is supported by the rental finance business, Mercantile Rental Finance, which has 10 000 clients and has seen its rental book grow from R30 million to R660 million in five years. These may not be big numbers, but in percentage terms Mercantile increased its deposits, lending and profitability by over 20 between October 2015 and October 2016 in a period when lending to SMEs has been flat. For Kumbier, developing targeted solutions for entrepreneurs comes naturally. My father set up a textile factory in the 1970s, my sister is a chiropractor and my brother has a business in the motor industry. As an accountant he has been exposed to entrepreneurs in diverse ways: Ive loved working with entrepreneurs whether buying and selling their businesses in corporate finance, providing business banking services or helping to grow a bank in Ghana all of these experiences have created a passion for entrepreneurs and growing small business. It is the time of year when starry-eyed children write to Santa or look to parents and grandparents in the hope of getting their hands on the latest gadget or toy. While adding an investment to a Christmas stocking may (literally) not have the same ring to it, it can be a great way to teach children about money, and get them interested in the investment process. Warren Wheatley, chief investment officer at TSS Capital, says it is an exceptionally good idea to give investments as gifts. In investing, the earlier you start the better, because of the benefits of compound interest, he says. Besides the obvious financial benefits, the mechanism of the gift allows for recurring gifts over the years and can facilitate the pooling of family resources. Friends and family can jointly contribute to a single investment structure at every gifting occasion, he adds. Lynette Wilkinson, Certified Financial Planner and retirement specialist at Chartered Wealth Solutions, echoes his sentiment. An investment is a gift that lasts and grandparents can participate in teaching their grandchildren the value of saving. Investments generally have a longer useful value than most toys would. As children grow older and see the value of their investment increasing annually, the excitement will grow, adds Martin de Kock, Certified Financial Planner and director of Ascor Independent Wealth Managers. share on facebook Investments in the Christmas stocking share on twitter Its also a great learning opportunity to teach children from a young age what saving and investing is all about. Generally there is a big shortage of financial skills among young children and even teenagers, because parents dont spend enough time discussing financial issues and basics with their children. De Kock says grandparents find joy in childrens reaction when they receive and open a gift. To still experience this joy it may be practical to buy a small and cheap gift along with the investment certificate. Parents and grandparents should take time to explain the long-term benefits of the investment and can consider using a maize seed as an example, De Kock says. You can grind the maize seed now and eat it as porridge, or you can plant the seed and harvest numerous maize seeds in a years time, giving you maize to eat and more to plant for a later harvest. There are numerous investing principles that can be explained, depending on the age of the child. An important principle is that of delayed gratification and saving for something bigger in the future, he adds. Wilkinson says she generally recommends a balanced diversified fund on a unit trust platform, that can also accommodate other funds if they want to have some money market exposure for shorter-term saving objectives. In her experience, getting children excited and involved in money and investment affairs will depend on the adults involvement in the investments. If they are interested they will pass that on to the children and be able to discuss it. Buying a tracker fund like Satrix or Coronations Top 20 fund, allows the adult to discuss the companies owned by the fund. As an investor, one can then point out where their offices are and what they do as part of an everyday experience. Wheatley says his son is a typical 11-year old who loves video games and is allowed limited access to social media. Since he constantly looks things up on the internet and watches YouTube videos all the time, it was easy to peak his interest in investments by looking directly at shares like YouTubes parent company, Google, as well as Amazon and Facebook. In short, we built a share portfolio made up almost exclusively of companies whose products and services he uses or wants to use. It also provides a mechanism to start teaching the basics of fundamental analysis by comparing the various companies. Start small Even if you prefer to go the traditional gift route, there are some interesting apps that could assist in teaching children about money and investments without necessarily having to invest. Standard Bank recently launched Kidz Banking, an educational app aimed at children between the ages of six and 11. In the investment space, SatrixNOW offers investors the option of buying a voucher as a gift. The minimum is set at R50. The depreciation of the rand has created significant interest in offshore investments, but although they are an integral part of a diversified portfolio and can offer access to sectors not represented in the local market, the decision should not be informed by short-term currency weakness. Equity markets are generally quite expensive and sudden rand strength may impact returns in the short term. This should be a long-term decision. CoreShares recently launched two exchange-traded funds (ETFs) that offer global exposure by tracking the SP 500 and the SP Global Property 40 indices. Getting children excited about non-traditional gifts There are numerous investing principles that can be explained, depending on the age of the child. A deadly serious business that requires a strategy HOW TO USE THIS MAGazine In a depressed economy where small businesses are being squeezed left, right and centre, Mercantile Bank has grown its assets under management by 55 between 2013 and 2016. It has done this by taking market share from the bigger banks. Our sole purpose in life is to grow entrepreneurs, says Karl Kumbier, CEO of the bank, which is owned by Caixa Geral De Depsitos, a Portuguese Government-owned international banking group. Just as Capitec focuses on the market less served, and Investec targets high net wealth individuals, Mercantile has created a niche, focusing on small and medium sized businesses only. SMEs have been badly serviced in the past and we believe we can make a difference, he says. Growth has had to come from market share because the sector is not growing. It is a tough environment for SMEs, Kumbier says. share on facebook Young, promising, enterprising, innovative There are numerous investing principles that can be explained, depending on the age of the child. share on twitter It has done this by taking market share from the bigger banks. Our sole purpose in life is to grow entrepreneurs, says Karl Kumbier, CEO of the bank, which is owned by Caixa Geral De Depsitos, a Portuguese Government-owned international banking group. Just as Capitec focuses on the market less served, and Investec targets high net wealth individuals, Mercantile has created a niche, focusing on small and medium sized businesses only. SMEs have been badly serviced in the past and we believe we can make a difference, he says. Growth has had to come from market share because the sector is not growing. It is a tough environment for SMEs, Kumbier says. Large corporates are paying late and small operators are struggling to collect debtors. On average, debtors days have moved from about 45 days to 50 days. But entrepreneurs are resilient. They are looking for new opportunities. Even if they are just covering costs at the moment, markets will turn, and the good companies will remain. While Mercantile will support any business with an entrepreneur behind it, from a hairdresser to Richard Branson, it is not a banker to startups, he says, acknowledging that it is very difficult for startups to raise money. Roughly eight out of ten start-ups will fail. But the two out of ten that are generating positive cash flow and are profitable we will provide them with solutions. While Mercantile banks thousands of SMEs, and is partnering with fintech companies and market disruptors such as Yoco, Forex People and SureSwipe, Kumbier acknowledges the company does not have a strong brand. We have 1 share of the market so we fly under the radar. Sometimes clients have been turned down by other banks before they come to us. This is not a deterrent, he says. If our credit committee which meets every afternoon at 4:30 - buys into the vision and business plan, clients can have an indicative answer by the next morning. In one instance, a security company with 2 000 guards approached the bank after being turned down by others. With the banks backing they have grown to the point that they have over 10 000 guards and are still growing. While total assets under management have grown from R7.5 billion in 2013 to R12 billion in 2016, Kumbier says that growing deposits is the challenge for small banks. With this in mind, the bank has focused on building targeted solutions for specific professions. For instance, it has built Mercantile Online Invest, which simplifies the management of trust accounts for lawyers, estate agents and forex intermediaries. This has seen deposits increase by R1.9 billion over the past 18 months. This month, Mercantile will be launching a unique offering for professionals initially focused on the medical sector - whereby the bank will help chiropractors, dentists, physiotherapists and others with the financing necessary to establish their practice. This offering is supported by the rental finance business, Mercantile Rental Finance, which has 10 000 clients and has seen its rental book grow from R30 million to R660 million in five years. These may not be big numbers, but in percentage terms Mercantile increased its deposits, lending and profitability by over 20 between October 2015 and October 2016 in a period when lending to SMEs has been flat. For Kumbier, developing targeted solutions for entrepreneurs comes naturally. My father set up a textile factory in the 1970s, my sister is a chiropractor and my brother has a business in the motor industry. As an accountant he has been exposed to entrepreneurs in diverse ways: Ive loved working with entrepreneurs whether buying and selling their businesses in corporate finance, providing business banking services or helping to grow a bank in Ghana all of these experiences have created a passion for entrepreneurs and growing small business. Yoco is a small business to watch Exchange-traded funds are catching on. Research by my firm, Intellidex, recently found that, after cash equities, ETFs are the most traded form of stock market investment among South African retail investors. share on twitter ETFs: Miracle product There are ways around this many ETFs rebalance at set intervals, such as quarterly. But still, as long as active investors know when ETF-related flows are going to hit the market, they can front run them. According to Bloomberg, ETF front-running costs the funds about 4.3 billion a year, an amount equal to double or triple the overt costs they charge investors. This is often not visible to investors, disclosed as the tracking error of the fund, rather than the charges that are actually levied. But when the all-in cost to investors is added up, the cost advantages of ETFs relative to actively managed funds becomes much less clear. The SEC is more worried about systemic risks around ETFs, such as their potential to exacerbate violent flash crashes in market movements. It was particularly concerned following major movements in August 2015, when 1 000 securities were suspended from trade in a single session after they triggered emergency volatility circuit breakers. That was largely blamed on ETFs. A much older criticism of ETFs, often mounted by the active fund management industry, is that they make dumb investment decisions, buying stocks that have been winners and become larger parts of indices, while selling losers. As a general investment strategy, that stands in conflict with value buying, picking up unloved companies whose prices have shifted too low and selling the stars. The criticism is that an index-tracking strategy is likely to systematically bias investors toward winners and against losers, so pushing share prices into bubble territory. Another criticism is that ETFs are, by definition, not active investors, so they play no oversight role over the companies in which theyre invested. ETFs dont vote on shareholder resolutions, let alone criticise management decision-making. For errant management, having a large passive investment base in your shareholding will make life very comfortable. A related criticism is that pricing of securities in a market with heavy ETF participation is going to be less efficient, in the sense that prices wont be as responsive to new information. For South African investors, the debates that are increasingly occurring in the US are interesting to watch, but the role of ETFs here has not yet grown to levels that provoke the same concerns. ETFs remain a clearly superior way to obtain broad exposure to an asset class without having to fear some of the downside risks worrying regulators elsewhere. Someday, however, that may no longer be true. share on facebook Of 6 300 respondents to an online survey of stockbroking account holders this year, 28 said they use ETFs compared with 20 two years ago. The growth has been supported by the fact that tax-free savings accounts, which became available from stockbrokers in March 2015, are only allowed to invest in the stock market through ETFs and unit trusts, and not individual shares. National Treasury argues that the instruments are lower risk than ordinary shares because they give investors exposures to portfolios rather than individual shares, which can be more volatile. ETFs appear to be a miraculous product. You get the benefits of tracking an index without the expense of having to pay a fund manager to look after it, or the hassle of trying to assemble a portfolio on your own. Costs are almost always under 1 per year and as low as 25 basis points for simple index trackers. Plus, unlike unit trusts, they can be bought and sold immediately while markets are open and prices are easily visible. Regulators here have long pushed for increased use of passive products like ETFs as a cheaper option for savers and pension funds. But, in places where such funds have had the most success, regulators are starting to worry. In the US, which has 70 of the worlds ETFs by value, ETFs hold 30 of all shares. The US Securities and Exchange Commission (SEC) recently began a full review of the industry, worried that the flow of funds into ETFs is contributing to market volatility. The problem with passive investing is that buy and sell decisions are automatic. For a typical index tracker, if a stock goes up in value the funds have to buy it, and if it goes down in value they have to sell it. So you can see how ETFs might exacerbate market movements, amplifying the impact of active buying and selling decisions. For active investors, those movements will range from irrelevant to a source of further profits. If you are able to anticipate the herd of buying and selling that follows movements in the market, you should be able to game the ETFs. One simple strategy would be to sell before the ETFs follow and then pick up shares as their selling subsides and ride the price back up as they follow suit. With enough active investors doing that, it would become impossible for ETFs to track an index very closely, lagging index movements. As it is, ETFs typically deliver a return slightly behind the index. As they grow, market distortions are appearingThe Forex miracle: Earn 600 per annum Trader makes effective annual growth of 10 840. Malcolm Rees nbspnbsp 16 May 2013nbsp23:30 JOHANNESBURG 8211 Last month Moneyweb reported on the investment scheme, NaxaInvest. which offered investors returns of 2 a day, ostensibly through trade in the foreign exchange market (forex). Following the report, the Financial Services Board (FSB) was quick to issue a statement warning investors to avoid the scheme as it was not an authorised financial services provider. Surprisingly, forex proponents have mounted a defence of Naxarsquos claims that returns in excess of 600 are possible through currency trade. One such forex guru is FSB-licenced Johan van As. ldquoSuccessful forex traders can do much better than the 2 profit per day offered by these schemes, rdquo he claims. Through his company ForexMasters. Van As offers clients three-day forex training programmes from his home, at a cost of R10 000. A hefty fee, perhaps, but not if the kinds of returns Van As claims to be able to help his clients achieve are possible. In defence of his claims, Van As has provided Moneyweb with the prospectus of PrivateFX. a privately-managed forex programme which claims to have generated a 716 compounded return in 14 months. He also claims that international forex guru Greg Secker charges R25 000 for two days of training and three hours of telephonic backup, in comparison. However, Van As warns: ldquocompanies trading on behalf of clients are very careful with their money management and risk-taking. ldquoTherefore the results are lower than an individual can do. rdquo Individuals raking it in Such individuals include Van Asrsquo client Adrian, who apparently deposited 337.60 into his trading account on July 11 2007, and claims to have made a profit of 9 133.00 within the following three months. Thatrsquos equivalent to an annual growth of 10 840. Moneyweb has a copy of his accounts, which indicate these growth rates to be accurate. Another such successful forex trader is Lourens Smit, an 80-year old pensioner, a Van As client. ldquoForex for the right man, if you are reasonably knowledgeable with figures, is a gift from heaven, rdquo he says. ldquoI am not prepared to guarantee this but I have made an average of 10 every month. I started with 8k and I worked it up to a very substantial amount hellip of quite a few hundred thousand dollars within less than a year, rdquo he said. ldquoThere is no way that anybody with all the experience in the world can teach you what is going to happen in the next five minutes. But there are trends to follow and there are 101 different methods you can employ to help you decide if this is a long shot or short shot, rdquo he says. A choir of champions ForexMasters is by no means a sole voice singing the song of fantastic forex returns. Instead it appears to be joined by an ever-intensifying choir of forex proponents. Through his twitter stream, Van As promoted the US forex software, forexdominator. whose creator, Cecil Robles, claims to be able to predict moves in the currency market with 84 accuracy. By purchasing the software forex investors ldquodonrsquot have to do practically anything except decide how much profit you want to make on the opportunities the software alerts you to and occasionally monitor your open tradesrdquo. The software is based on 25 000 of research and development and ldquoit does 99 of the heavy lifting for you, rdquo he claims. Greg Secker, has also been making his rounds in SA8217s motivational speaking forums, including at Sandton City, through the lsquoKnowledge to Actionrsquo campaign. Secker8217s promises of delivering the 8220greatest opportunity in the history of mankind8221 through rapid forex millions has been questioned by the UK8217s Guardian. which revealed that his trading subsidiary had net assets of just pound91 132 on 31 December 2010 and made a loss during the year of pound97.13. Locally, the investment platform Trading Results offers investors access to the fantastic returns generated by the US platform which shows a 931.13 gain since November 2011. Trading Resultsrsquo website had originally promised investors a 3 to 5 growth per month, but seems to have altered the statement since it was informed by Moneyweb that promising returns in excess of 20 per annum above the Repo rate is illegal according to the Consumer Protection Act. Vista ldquohave published their results since 2009 and have shown a growth of more than 60 per annum and last year they showed their growth of 100,rdquo says Trading Results director, Pierre Van der Walt. ldquoSo we say that we offer 40-60 growth which is less than that. rdquo While many forex trading platforms offer an easy and rapid gateway to untold millions Van As is a little more forthcoming regarding the risks involved. ldquoForex trading is not an easy activity, rdquo he says, although adding that ldquoit is also not too difficult. rdquo ldquoYou need to be a very disciplined person, you must have lots of patience, must be able to endure stress, must have a good understanding of the markets and must have a good method to interpret the market moves, rdquo he says. ldquoThe trader must be comfortable with the risk and must accept the fact that he can lose his money if he makes too many mistakes. ldquoIt takes time to develop skill in trading. There unfortunately is no quick-fix or get rich-quick recipe. rdquo However, even in light of Van Asrsquo warning, the apparent opportunity for laymen to generate returns which dwarf those achieved by professional fund managers does beg a certain obvious question. Why arenrsquot more investment managers placing clientrsquos money in Forex funds and why arenrsquot plethora of forex experts who offer training not simply entering the market themselves to generate the returns they promise instead of spending time delivering the expensive, but not fantastically expensive, training programmes they offer ldquoForex markets are unpredictable and volatile, so this means that there is potential to make a lot of money, but the opposite is also true, rdquo says Chantal Robertson, head of Specialist Sales at FNB. ldquoThe forex markets would be a high risk investment, and one would therefore expect to make a better return when compared to say an equity investment. However, ldquogiven the volatility of the markets, it is unlikely that massive returns would be achievable on a sustainable basis. ldquoA word of caution for all potential investors when being promised such brilliant returns is that they need to ensure that they are using a reputable firm. This is especially true when using a foreign trading platform. ldquoTypically individuals fund this by way of their foreign investment allowance, which is subject to the standard regulatory requirements. rdquo Tanya Woker, former vice-chairperson of the Department of Trade and Industryrsquos Consumer Affairs Committee has also warned that, as with NaxaInvest, promises of fantastic returns through investment opportunities such as Forex are commonly used as a front to lure investors into illegal get-rich-quick schemes such as Ponzis and pyramids. Robertson emphasises that FNB, as an authorised dealer, does not offer a speculative trading platform as a product. Jennifer Mbabazi Moyo El-hadj M. Bah Audrey Verdier-Chouchane African Development Bank The authors gratefully acknowledge the very useful comments provided by Steve Kayizzi-Mugerwa, Acting Vice-President and Chief Economist, AfDB Issa Faye, Manager, AfDB Research Division Zuzana Brixiova, AfDB Economics Complex and Xavier Boulenger, Joseph Coompson, Ken Johm, Benedict Kanu, and Damian Onyema, AfDB Agriculture and Agro-industry Department. In particular, they would also like to thank Charlotte Karagueuzian and Anna von Wachenfelt (AfDB Consultants) for their excellent research assistance. Agriculture persists as an important sector of the African economy. Although its significance in the economy varies widely across African countries, agriculture remains a vital sector for most countries. It contributes from 2.4 percent of GDP in Equatorial Guinea to 70 percent of GDP in Liberia, 1 providing an average of around 15 percent of GDP for the continent. The declining GDP contribution of agriculture to the economy is a sign of low productivity and limited value addition to agricultural commodities, as the sector provides employment for 50 percent of the labor force (see Chapter 1.1, Figure 4) 47 percent of these workers are women. 2 It is the main source of income for Africas rural populationestimated to represent 64 percent of the total. Africas agriculture is dominated by a variety of staple food crops (maize, rice, sorghum, millet, cassava, yams, sweet potatoes, etc.) and a few traditional cash crops (coffee, cotton, cocoa, oil palm, sugar, tea, and tobacco). The sector is also characterized by a high percentage of smallholder farmers (80 percent) cultivating low-yield staple food crops on small plots with a minimal use of inputs. These farms depend on rainwater, thus subjecting production to the vagaries of the weather. Despite its importance, agricultural productivity remains dismal, undermining Africas overall productivity and food security. The sectors productivity in Africa considerably lags other developing regions (see Figure 1 for cereal yields see also Chapter 1.1. Figure 5a) and, unlike other regions, Africa has not benefited from the green revolution. 3 In spite of its vast natural resources, including a huge expanse of arable land, Africa has the highest incidence of undernourishment (estimated at almost one in four persons) worldwide. Africa imports food staples valued at about US25 billion annually, essentially because food production, supply, and consumption systems are not functioning optimally. The level of value addition and crop processing of agricultural commodities is low and post-harvest losses in sub-Saharan Africa average 30 percent of total production, meaning that the region loses over US4 billion each year. 4 Moreover, the poor performance in agriculture undermines poverty reduction and inclusive growth. Despite its fast economic growth in the last two decades, poverty reduction in Africa has remained limited. The Millennium Development Goals Report finds that the share of people in sub-Saharan Africa living on less than US1.25 a day slightly decreased, dropping from 56 percent in 1990 to 48 percent in 2010. 5 The limited decrease in poverty is partly the result of the fact that growth has been driven mostly by low labor-intensive sectors such as mining, while agriculture played a minor role. A substantial body of the literature finds that agriculture-led growth has greater impact on poverty reduction than non-agriculture-led growth. 6 The agriculture sector is a key to achieving inclusive growth because, in Africa, it consists mostly of smallholder farmers, the majority of whom are women. 7 With higher agricultural productivity gender-equal access to land, seed, and fertilizer and overall better performance in rural economies, growth will reach the most disadvantagednamely women and youth. However, considerable effort is needed to ensure that institutions and mechanisms for inclusion are put in place, while at the same time pushing toward the development of large commercial farming. The slow productivity growth in agriculture is also constraining Africas structural transformation process and economic diversification. As reported in several studies on structural transformation, reliance on subsistence production and weak productivity growth in the agriculture sector prevents the workforce from moving out of this sector into manufacturing and services. 8 Globally, countries that have developed successfully are those that have shifted their resources from agriculture to manufacturing. 9 However, as indicated in Chapter 1.1 Figure 4, this is not the case for Africa, where labor tends to move more into services, in particular trade, rather than into the manufacturing sector. Given the low productivity in services and the prominence of the informal service sector, this current pattern of structural transformation will not yield sustainable income growth for the majority of people nor will it lead to economic development. 10 Inclusive growth and higher income for the majority requires higher productivity in labor-intensive sectors, including agriculture. As outlined in its 10-year strategy 201322, 11 the African Development Bank (AfDB)the first and overarching objective of which is to promote inclusive growthwill pay particular attention to agriculture and food security, to fragile states, and to gender. This chapter presents the ingredients needed to transform Africas agriculture in order to make it more competitive. The next section explains the missed green revolution in Africa and draws lessons for the continent from Asias experience. The following section analyzes the mechanisms for productivity improvements, with a particular focus on the role of information communication technologies (ICTs) in agriculture and the importance of land reforms. It also considers the opportunities and challenges of biotechnology for facilitating a quantum leap in productivity. The next section considers the role of value chains in unlocking markets for smallholders, who make up the bulk of agriculture producers in Africa. It begins with a discussion of Africas positioning and potential within global and regional value chains and then addresses the means for creating a conducive environment that fosters greater value chain integration. The chapter then outlines the AfDBs recent and planned future support of the agriculture and agribusiness sectors to enhance both inclusiveness and competiveness. Conclusions and policy recommendations are then discussed. Impediments to Africas green revolution The green revolution benefited most regions of the world, particularly East Asia, as it resulted in regional food surpluses within 25 years. Asia benefited the most, with significant increases in cereal yields (Figure 1) in East Asia and the Pacific, for instance, cereal yields almost quadrupled between 1960 and 1990. Driven by the political will to make their countries food self-sufficient, Asian countries doubled cereal production between 1970 and 1995, while the total land area cultivated with cereals increased by only 4 percent. 12 Drawing lessons from Indias experience, this success has been attributed to several factors. 13 First, the adoption of high-yielding seed varieties resulted in a substantial increase in food grain production, particularly wheat and rice. Second, the use of pesticides positively contributed to increased yields, albeit at the expense of the environment, discussed later in this chapter. Third, the availability and expansion of agricultural infrastructure facilities such as irrigation facilities, machinery, extension services, and broader infrastructure facilitiesincluding transport and communication as well as storage and warehousing facilitiesfurther supported the green revolution. Fourth, the expansion of better crop and soil management techniques, including multiple cropping practices, fostered the advance of the green revolution. Fifth, agricultural credit and land reform were crucial ingredients that enhanced agricultural productivity. Short-term credit facilities were provided by cooperative banks, while long-term credit was provided by development banks. This was done together with land reforms aimed at consolidating land holdings and giving farmers security of tenure, thereby enabling farmers to access credit facilities. However, the green revolution is more than a technology fix, and a supportive economic and policy environment remains vital to its success. Addressing the need for functioning markets to handle the surge in production went hand in hand with addressing the need to educate farmers about the new technology and to ensure that they both have access to inputs and receive a fair reward for their investments. In addition, government interventions were crucial to ensure that small farmers were included rather than left behind. 14 For instance, Asian governments formulated various pro-small farms policies including policies relating to credit, incentive prices for crops, and subsidized input prices. Consequently, the green revolution successfully reached poor and remote rural population on the Asian continent. In contrast, Africa did not benefit from the green revolution. Figure 1 reveals that cereal yields in Africa have been virtually constant during the period 196090. This lack of progresstogether with factors such as high population growth, policy distortions, weak institutions, poor infrastructure, extreme weather events, and political instabilityexplains why African countries are still dependent on food imports. While Asian countries largely increased cereal yields per hectare, African countries mainly expanded the area cultivated to enhance production. The increase in the land area cultivated, coupled with poor crop husbandry, resulted in extensive environmental problems such as nutrient mining desertification degraded soils and loss of forests, wetlands, and pastures. Moreover, this poses a challenge to Africas long-term agricultural productivity and the sustainability of its agricultural production. As a result, in the face of rapid population growth, sub-Saharan Africa imports about US25 billion of staple foods annually despite the continents vast agricultural potential, putting a strain on scarce foreign exchange reserves. This chapter next considers the main reasons for the missed green revolution in Africa, focusing primarily on ecological, technical, policy, and institutional factors before drawing lessons from past green revolution experiences in Asia and adapting them to Africa. Explaining the missed green revolution in Africa With regard to ecological factors, Africas soils vary by region and are, in general, very different from, and less fertile than, the Asian volcanic soils and alluvial valleys. Weather shocks such as droughts are frequent, and rainfall varies dramatically across Africa, with the northern half of the continent containing large arid areas. These ecological factors are a significant impediment to Africas agricultural development, given the continents low use of irrigation and overwhelming dependence on rain-fed agriculture. International research on high-yield crops did not focus on African staple foods and agro-ecological systems. Although the green revolution in Asia can be attributed to the extended use of irrigation, improved crop varieties, and expanded use of chemical fertilizers, the implementation of similar strategies in Africa has not been successful. 15 According to the World Bank, the heterogeneity of both agro-ecological conditions and crop production (maize, cassava, millet, sorghum, cassava, yams, sweet potatoes, etc.) suggests that outside technologies are often not directly transferable to improve the continents productivity. In other words, the productivity revolution in Africa needs a tailored approach and a more careful contextualization to better fit with Africas specific agricultural conditions. 16 This includes a focus on the development of technology more suitable for Africa that is aimed not only at increasing productivity of root and tree crop production systems but also at saving labor for cereal production. 17 Likewise, improved varieties have to be developed to take into account the African environment with its specific requirements. This has started happening with the development of NERICA rice (see also Box 2) and high-yielding varieties of cassava. Inadequate policies have distorted Africas agriculture sector, thereby constraining technology adoption. In the past, indirect and direct taxes distorted prices and prevented farmers from adopting modern inputs such as fertilizers. In addition, many African governments established agricultural marketing boards that purchased products from farmers at fixed prices and resold the products in domestic and international markets at prevailing market prices, while controlling exchange rate to protect the local market. This scheme served to control prices so as to ensure income stability to the farmers. The implication was a lack of incentive to invest in intermediate inputs such as fertilizers. 18 Policy and market failures account for the slow adoption of productivity-enhancing inputs such as equipment, fertilizers, and pesticides. Figure 2 shows that fertilizer use is still low in most countries. Voortman argues that several market and institutional factors have discouraged African farmers from using fertilizers. 19 First, underdeveloped markets (low volumes), high prices, and high transport costs have limited the availability of fertilizers. Indeed, as Chapter 1.1 documents, sub-Saharan Africas infrastructure deficit (mainly roads and electricity, as well as ICTs) is significant, particularly in small and landlocked countries. This impedes the provision and use of productivity-enhancing inputs. For example, as Gollin and Rogerson argue, poor transportation networks account in large part for the low productivity of Ugandas agriculture. 20 Second and most importantly, fertilizer costs have not been recouped because soil analysis has not been taken into account to determine the appropriate fertilizers. The popular fertilizers (nitrogen and phosphorous) developed for Asian and Latin American soils have had minimal or no effect on yield in Africa. 21 Indeed, the heterogeneity of African soils requires the usage of targeted fertilizer applications. Despite recognition of the importance of the sector in Africa, investment in agriculture has been neglected by African governments and donors. Although official development assistance has increased by about 250 percent between the 1980s and the 2010s, allocation to agriculture has halved. According to the Food and Agriculture Organization of the United Nations (FAO), on average, African governments reduced their spending on agriculture from 4.5 percent of total expenditure in 2001 to 2.5 percent in 2012, 22 despite their 2003 pledge to spend at least 10 percent under the African Unions 2003 Maputo Declaration target. Limited funding has prevented the development of research capability in biotechnology, the provision of adequate support for agricultural research, and private-sector participation in agriculture. Low investment in agriculture has partly led to overreliance on rain-fed farming with very little irrigation. The irrigated share of Africas cropland is less than a quarter of the world average. 23 Only 4 percent of crop areas are irrigated in sub-Saharan Africa in comparison, this represents only a small fraction of the Asian investment in irrigation, where 39 percent of the production area is irrigated in South Asia and 29 percent in East Asia. 24 In contrast, Africa has numerous river systems that are not fully exploited and significant groundwater resources that remain largely untapped. These groundwater resources are unevenly spread over a wide range of agro-ecological zones, especially in Southern Africa and some parts of North Africa. Irrigation on the African continent is also hampered by poor water management, which is one result of underdeveloped institutions. Furthermore, while Asias green revolution mainly focused on irrigated wheat and rice, sub-Saharan Africas main staples comprise a much wider variety, including maize, cassava, millet, sorghum, yams, sweet potatoes, and plantains. This wide range of food crops reinforces the argument that Africas agriculture needs to focus on its specific context, as discussed earlier. Furthermore, the lack of good governance and economic institutions in Africa, especially in the financial and insurance sectors, has hampered farmers ability to develop. The general low financial inclusion in Africa is even worse in agriculture, where the production cycle consists of high initial investment, a medium to long period of no cash inflow during the growing season, and large cash windfall after harvest. Many of the products offered by banks and financial intermediaries are inappropriate for smallholder farmers because loan repayment schedules do not take into account crop cycles. Modern financial servicessuch as microloans, credit registries, and value chain financingare therefore needed to improve access to credit to smallholder farmers. The challenges of providing acceptable collateral for agricultural lending are enormous. Moreover, most countries lack tailored insurance products. This means that adverse shocks, such as droughts, often lead to famine because farmers are unprepared to respond. In this context, micro-insurance is emerging as a valuable instrument for protecting farmers. Land governance pertaining to land access, distribution, and female ownership will be further discussed below in the section on mechanisms for productivity improvement. In many countries, land ownership is governed by customary laws this has resulted in high land inequality. Indeed, although women constitute the bulk of the labor force in the continents agriculture sector, rules governing ownership and transfer of land rights are unfavorable to women in Africa. 25 Box 1: Lessons for Africa from the Asian green revolution Some important lessons for Africa that can be drawn from the Asian green revolution include: Double green the agricultural revolution. Higher productivity came at the expense of environmental issues in Asia. The environmental effects of increased agricultural productivity in Africa depend heavily on the sources of productivity growth. Water - and soil-saving innovations undoubtedly have positive effects. However, such techniques are often achieved through the intensive use of manufactured inputs such as fertilizers and chemicals with negative externalities. Instead, productivity can be improved with best practices in terms of environmental impact at all levels of the value chain. Resilience to climate change will be an increasingly difficult challenge to tackle. Promote responsible farmers borrowing. In Asia, the technological dimension of the green revolution was supplemented by heavy government intervention through subsidies on inputs. However, these massive government expenses were not sufficient to limit farmers indebtedness. Green revolution packages ended up indebting a large number of smallholder farmers, eventually pushing them into landlessness and poverty. Develop rural non-farm activities to diversify income. The green revolution in Asia focused on rural farm activities. Kanu et al. highlight the importance of emphasizing rural non-farm activities to diversify income sources, finance on-farm investments, buy food, and stabilize household income during difficult times of drought or price shock. 1-1 To enhance its sustainability, income has to come from diverse sources. Sources: Based on Lapp et al. second edition, 1998 Kanu et al. 2014. The green revolution in Africa is not a lost cause. Africa can gain from productivity improvements with the right set of policies, institutions, and resources, while also drawing from the lessons of the Asian green revolution (Box 1). Today many organizations are working toward this goal. Among them is the Alliance for a Green Revolution in Africa (AGRA), founded through a partnership between the Rockefeller Foundation and the Bill amp Melinda Gates Foundation. AGRA is focusing on many of the issues highlighted above, including the development and distribution of high-yield seeds and the improvement of soil health, market access, and financial access. Other research institutions, such as the Africa Rice Center and the International Institute of Tropical Agriculture (IITA), are also working to develop high-yield crops. In general, international research funding and coordination among stakeholders in the agriculture sector have both expanded as the value-added of the green revolution for reducing poverty and eliminating hunger has been increasingly recognized. Some success stories are highlighted in Box 2. Box 2: Recent success in the development of high-yield crops in Africa In recent decades, research efforts have resulted in high-yield crop varieties. For the second most important staple food in Africa . cassava, productivity changed with the introduction of an improved drought-tolerant cassava variety in 1977. Along with continuous improvement in breeding and pest control, the cassava yields have increased by over 40 percent in the past three decades. West Africa has seen up to 60 percent in productivity gains, which has clearly helped to reduce poverty in the region. More recently Malawi and Rwanda have demonstrated rapid production growth it tripled in Rwanda between 2007 and 2011. 2-1 The introduction of modern, high-yielding varieties of maize in East and Southern Africa during the 1960s allowed the crop to develop into one of the continents major sources of calories. Over the last decade, maize production has been particularly significant in West Africa. Nigeria, for instance, has seen its maize yields rise steadily as farmers adopted improved varieties and hybrids, which are drought tolerant. Overall maize production in Africa has increased at an average 5.5 percent per year between 2000 and 2010, while areas harvested remain lower than in 1990, indicating an improvement in production technology. 2-2 Beans are another major staple in Africa, particularly in East Africa. Recently, nearly 10 million farmers in the region, especially in Kenya, Tanzania, and Uganda, have intensified production by relying on high-yielding climbing beans, which are more tolerant to warm temperatures. These improved varieties have brought about substantial productivity gains, as yields in Rwanda and Uganda increased 53 percent and 60 percent, respectively. 2-3 Moreover, in both the Democratic Republic of Congo and Rwanda, bio-fortified beans have been introduced to a wider audience, and by 2014 about one-third of the population in Rwanda farmed and consumed them. In 1999, the NERICA (New Rice for Africa) rice, especially developed for African conditions, was released to farmers. The NERICA ricea combination of African and Asian rice varietieshas proven to be drought tolerant, high yielding, early maturing, and resistant to Africans major pests and diseases. It is now cultivated on about 200,000 hectares across Africa. The rice yields in sub-Saharan Africa have increased significantly over the last years as yields grew by 30 percent from 2007 and 2012, and with a faster rate than the global average. 2-4 Efforts to develop other high-yield varieties of rice are underway for other types of soils. 2-5 The next section discusses ways to improve agricultural productivity by leveraging technology and reforming land governance. Mechanisms for productivity improvement in the context of the green revolution: Leveraging technology and land reforms The Comprehensive Africa Agriculture Development Programme (CAADP) is at the heart of the quest for agricultural productivity improvement in Africa. It was established by the African Union and the New Partnership for Africas Development (NEPAD) in 2003, with the goal of an annual productivity growth rate of at least 6 percent. 26 The program has four pillars: (1) land and water management, (2) market access, (3) food supply and hunger eradication, and (4) agricultural research. Since 2003, agricultural GDP has grown on average by 4 percent. Nin-Pratt et al. estimate that total factor productivity (TFP) for the 200110 period grew on average by 2.1 percent. 27 Although this is a considerable improvement over the 1.4 percent growth seen in the 1990s, it is still below expectation. Assuming the same growth rate of inputs as observed in the 1990s, Ludena estimates that a TFP growth rate of 4.4 percent is needed to achieve an output growth rate of 6.2 percent. 28 To bridge this gap, the important factors that contributed to the green revolution (as discussed in the previous section)including the introduction of high-yield varieties, irrigation, increased and better use of fertilizersare still pertinent. As aptly put by Hazell, there is an urgent need to bring the green revolution in an appropriately modified form to Sub-Saharan Africa. 29 Indeed, Africas agriculture should take advantage of recent developments in ICTs and genetic research, which have the potential to revolutionize the sector. Land redistribution policies are also crucial for improving productivity. Before discussing the role of ICTs and land reforms in these efforts, the chapter summarizes the various factors raised in the earlier discussion of the green revolution that are necessary to transform agriculture in Africa. The productivity drivers of the green revolution The introduction and development of high-yield crops is at the heart of Africas agricultural transformation. This was the most important factor in Asia and will also be the key driver of agricultural productivity in Africa. This development entails increased international and national research of plant breeding, taking into account the different types of soils on the continent. As pointed out above, research focusing on African agricultural conditions has increased, thanks to the work of various organizations, providing new hope for agriculture sector transformation. CGIAR (Consultative Group on International Agricultural Research) and AGRA, for instance, are working intensely to develop high-quality grains for African soils. Investments in research by international organizations and local government are highly beneficial. A US1 invested by CGIAR is estimated to yield US6 in benefits, while the same US dollar invested by governments in sub-Saharan Africa leads to US3 in benefits. 30 However, the discovery of new crop varieties will not lead to transformation if national governments do not increase their efforts to promote the adoption of these crops through effective extension services and the support of local bureaucracies. With the greater effects of climate change on weather patterns, irrigation has to increase substantially. Using an econometric model and data on 31 countries in sub-Saharan Africa, Fuglie and Rada find that that average yields in irrigated farms are 90 percent higher than the yields of nearby rain-fed farms. 31 You et al. estimate that internal rates of return on irrigation projects in Africa vary between 6.6 and 28.0 percent, depending on the type of irrigation and other conditions. 32 The estimates show a huge potential for irrigation in Africa. Beyond this, weather changes are increasingly unpredictable and Africa is severely hit in this regard. This means that reliance on rain-fed agriculture cannot continue and signals that Africa needs not only an increase in irrigation, but also needs to develop better mechanisms for dealing with climate variability. International organizations and national governments are working toward developing climate-smart agriculture to prepare the world to adapt and mitigate the effects of climate change for food security, which will certainly be of great interest to Africas agriculture. As soil fertility deteriorates, fertilizer use must increase. As noted earlier, fertilizers are not widely used for a variety of reasons, including market failures. Government interventions are, thus, needed to ensure availability of the right type of fertilizers, at the right price, and at the right times. Subsidies can be helpful, 33 but strong governance and farmer education are both essential for success. 34 Farmer field schools used for education and the provision of agricultural extension services are very beneficial for improving productivity and income. Furthermore, improved knowledge about the use of fertilizers lessens their potential negative impact on the environment. Davis et al. evaluate the impact of these programs in East Africa. They find an average increase of 61 percent in income, with varying degrees of success across countries. 35 In addition to fertilizers, farmers need to protect their crops from insects and pests through the careful use of insecticides and pesticides. Market access, regulations, and governance need to improve. As shown earlier in the chapter, policy failures have prevented Africa from benefiting from the green revolution, and thus policy needs to improve for the agriculture sector to yield significant benefits. Fuglie and Rada estimate that eliminating policy distortions in agriculture would raise output by 4.7 percent. 36 Improving rural infrastructure such as roads is also crucial to raising productivity. 37 Reducing shipping time and costs would significantly reduce losses in perishable food shipping and make exporters more competitive. As the next section will discuss, ICTs can enable and complement the above reforms. The role of ICTs for agricultural productivity improvement The rapid uptake of ICTs in Africa provides an important opportunity to improve the performance of agricultural value chains (AVCs) from the farm to the market. Indeed, ICTsincluding mobile telephony, radios, geographic information systems (GIS), and satellite imagery technologieshave been expanding in Africa. The likely contribution from ICTs can be viewed from the perspectives of potential stakeholders along the value chain: businesses and business organizations, farmers (smallholders, commercial farms, and trade agencies), researchers, and government departments. ICTs in agriculture can also be considered based on their applications along the stages of the production cycle: pre-cultivation, crop cultivation and harvesting, and post-harvest. 38 Several potential avenues are available at each stage for applying ICTs to increase agricultural productivity. The following analysis looks at various ICT applications at each stage of the agricultural production cycle and highlights successes. At the pre-cultivation stage, ICTs have several uses, ranging from land and crop selection to the development of crop insurance products they can also enhance land and water management and use. In fact, ICTs can be used for facilitating the process of land registration, allocation, and use for crop selection taking inventory obtaining weather information on the planting calendar and facilitating farmers access to credit. M-PESA in Kenya is a well-known example of a mobile technologybased payment system that is increasing financial inclusion even in rural areas. ICTs can help to develop crop insurance against adverse weather shocks and crop failures. An example of this is Kilimo Salama, 39 a mobile technologybased insurance on purchased inputs (certified seed, fertilizer, and crop protection products) that protects farmers against bad weather shocks. Mobile phones are used to scan the barcode of products purchased by farmers and M-PESA is used for payout at the end of the growing season in case of bad weather. Moreover, GIS and remote sensing (RS) are increasingly being used to ensure more efficient land use and water management. 40 GIS combined with RS has been used to support the assessment of land capability, soil conditions, crop condition and yield, flood and drought risk, groundwater contamination, and pest infestation. 41 For example, Egypt has developed a soil and terrain database for the Sinai Peninsula and other regions. Satellite imagery data and GIS have also been used in Ethiopia and Mozambique to enable land registration and crop inventories. India has many applications using GIS technology to support sustainable agricultural development. One of those applications is a cropping system analysis that identifies low-productivity areas. 42 At the crop cultivation and harvesting stage, ICTs also have other uses. ICTs can generate valuable information on land preparation and sowing, crop health, input managementparticularly the choice and use of fertilizerand pest and water management. ICTs can also be used to get information to farmers, particularly smallholder farmers who could otherwise be out of reach. In 2011, the GSMA mAgri Programme, in partnership with the Bill amp Melinda Gates Foundation, launched the mFarmer initiative to support the development of mobile agricultural value-added services (Agri VAS) in four countries: India, Kenya, Mali, and Tanzania. The Agri VAS, developed by mobile network operators, is designed to offer information on crop cultivation and market prices to farmers. 43 As in previous examples, at the post-harvest stage ICTs can provide market information that is crucial to improving market efficiency. A lack of sufficient informationincluding information on prices and market conditionsalong with price information asymmetries make it difficult for farmers to get fair prices for their crops. The uncertainty this causes can also discourage attempts to invest more in inputs and technologies. Efforts are being made on the continent to deal with information generation and dissemination issues within the context of commodity exchanges. For example, the Esoko Ghana commodity exchange (EGCI), 44 operational since 2005, publishes a weekly cash price index of commodities. Esoko has expanded in a dozen countries and provides price and knowledge data to farmers via mobile text messages. An even better known commodity market is the Ethiopia Commodity Exchange (ECX), which addresses the huge market inefficiency that prevented commodity buyers from interacting directly with sellers, and vice versa. Information was also asymmetrical on prices and product quality. The ECX disseminates information on products grades and prices and facilitates the coordination of buyers and sellers as well as the enforcement of contracts. All farmers in the country, including smallholder farmer cooperatives representing 2.4 million of farmers, are members of the ECX. They have access to price information, which is provided through a call center. Addressing the information asymmetry about the prices of crops in different markets has allowed farmers to have more marketing options and more bargaining power, and to increase their income by 10 to 30 percent. 45 Other potential contributions of ICTs in agricultural productivity improvement include the traceability of food and animals, which is important for participating in global value chains. Traceability entails displaying the lot number and the production facility name on each case of the product and recording this information on invoices and bills of lading. Data can be recorded and transmitted via different ICT platforms. 46 Recently an application that monitors cattle and provides valuable information, called iCow, was launched in Kenya. A related application is vetAfrica, which provides veterinary information. In addition, common information systems platforms linking all stakeholders are being set up in several countries as a way to share information and decrease maintenance costs. One example is Kenyas M-Kilimo, which comprises a database containing farmers information (land size, crop, language, etc.). Farmers can call to report problems and ask questions. Specific responses are tailored to the farmer whose information is already available in the system. Government extension services also use this system to provide farmers with customized solutions. Another recent scientific and technological innovation in the field of biotechnology and genetic engineering is having a profound impact on global agriculture. Below the potential of this technology for transforming African agriculture is considered. Opportunities and challenges of genetically modified (GM) crops The adoption of GM crops in Africa remains limited. In 2014, the AfDB and the International Food Policy Research Institute (IFPRI) published a report titled GM Agricultural Technologies for Africa: A State of Affairs. 47 The study examined the current status, issues, constraints, and opportunities presented by GM technologies in Africa. It noted that, although the use of GM crops is increasing in other developing countries, its adoption is very limited in Africa: only four countries (Burkina Faso, Egypt, South Africa, and Sudan) are currently farming some GM crops (cotton and maize). Some other countriessuch as Ghana, Kenya, Malawi, Mozambique, Nigeria, and Ugandaare piloting a variety of GM crops (banana, cassava, cowpeas, etc.). With the continents rapid population growth and the intensification of the effects of climate change on weather patterns, high-yield GM crops that are resistant to weather shocks represent an opportunity for Africa to address food insecurity. A majority of scientists argue that GM crops are safe to consume, and they also reduce insecticide use, greenhouse gas emissions, and soil-damaging tillage while enhancing farmers income and farm production without increasing the cultivated area. 48 A meta-analysis of 147 impact studies found that the adoption of GM crops (soybean, maize, and cotton) has, on average, reduced chemical pesticide use by 37, increased crop yields by 22, and increased farmer profits by 68. 49 A recent survey of members of the American Association for the Advancement of Science found that 89 percent of scientists argue that GM crops are safe to eat. 50 Despite the positive effects, there is still a debate on the safety of GM foods and a resistance to GM crops, especially from Europe. This debate has influenced perceptions in Africa and given way to extensive misinformation. For instance, in the midst of a famine in 2002, Zambia refused food aid that contained GM crops based on precautionary principles. 51 The positive benefits of GM crops do not mean, however, that they are a panacea for food security in the world. Food security depends not only on production output but also on distribution and availability at the right price. Moreover, yields of GM crops depend on farming conditions, and their benefits may not outweigh their costs under poor conditions. Other farming practices may increase yields as much as GM crops do. Another worry is that the seeds are controlled by a small number of multinationals, which means that farmers will always be dependent on purchased seeds. Adverse consequences of GM crops on biodiversity and gene flow need further research. 52 The 2014 AfDB-IFPRI report highlights the conditions necessary to increase Africas adoption of GM crops. 53 These conditions include increased funding for research and development to enhance biotechnology capacity and genetic modification. Regulatory systems also need to boost their capacity to inform decision makers. More outreach and better communication will ensure that Africans are well informed about the risks and benefits of GM crops. The next section explores how land reforms can address the issue of land access and distribution in Africa to improve agricultural productivity. Land reform for higher productivity and inclusion Africa has the highest area of arable uncultivated land (202 million hectares) in the world, yet most farms occupy less than 2 hectares. 54 This situation is a result of poor land governance and ownership that is based mostly on customary laws, which together have resulted in unequal distribution of land and uncertainty of tenure. With the introduction of land markets, land inequality and landlessness are growing in some countries, such as Cte dIvoire, Kenya, and Liberia, and in the Southern African region. From the 1998 household survey for Cte dIvoire, it is estimated that 5.56 percent of women own land versus 7.14 percent of men, and large land surfaces are concentrated in the hands of public employees. 55 The customary laws that often prevent women from ownership are a constraint to inclusive growth. Byamugisha sees land reforms as a pathway to shared prosperity in Africa. 56 Land reforms that clearly define property rights, ensure the security of land tenure, and enable land to be used as collateral and to be allocated more efficiently will be necessary in many African countries. Land allocation under customary laws often lacks the security of tenure and prevents owners from using their assets as collateral to access finance for purchasing inputs. Moreover, highly productive farmers may lack sufficient land to expand their production. Depending on the country, land reforms have to address access to land and distribution of land. Some countries, such as Cameroon, are using GIS systems to first register land before implementing redistribution mechanisms. The reforms should also ensure some form of tenure security that allows farmers to leverage their assets. Land reforms in African countries where colonial systems have resulted in high levels of inequality have succeeded to varying degrees. In some countries, mostly in Southern Africa, colonial systems expropriated large portions of land from the majority of the population for the benefit of a minority. Most of these countries undertook land reforms to redistribute land and address inequality, but failed. Zimbabwe tried land expropriation from white farmers to redistribute the land to black farmers. This has largely failed because the reforms transformed the country from a food basket and exporter to a food importer. The South African reforms that attempted to avoid those mistakes through a market-based and negotiated approach have, so far, failed to redistribute large areas of land as a result of an inefficient system and insufficient implementation of land transfer, which has left the country with high levels of land inequality and, according to the government, 50 percent of land transfer projects have failed. 57 Using a similar market approach, Namibia has been more successful in reallocating land. Over the last two decades, 8 percent of agricultural land has been transferred to black farmers in South Africa, while Namibia has reallocated 27 percent of its farm land. 58 One big difference in the two systems is that Namibia does not recognize ancestral land rights, and the state has the right of first refusal in any land sale in the country. Byamugisha holds out the land reforms in Malawi as a model of success for other countries to emulate. 59 The model is based on voluntary redistribution of large corporate estates to poor farmer groups with community-based land rights. The farmer groups are provided with funds to buy agricultural inputs in order to use their newly acquired land or diversify their production. The process has, thus far, helped 15,000 households, representing about 0.5 percent of total households, to gain land ownership. However, this success has yet to eliminate land misallocation in the country. Land redistribution policies should, however, not prevent market mechanisms from supporting the development of commercial large-scale farming. Adamopoulos and Restuccia found that the 1988 land reform in the Philippines, which imposed a ceiling on land holdings and restricted the transfer of distributed land, reduced farm size by 34 percent, and led to a decrease in agricultural productivity by 17 percent. 60 The effect of land misallocation is also found in Malawi. Restuccia and Santaeulalia-Llopis use micro data from the Malawi Integrated Survey on Agriculture collected by the World Bank in 201011 to study the link between land allocation and farm productivity. 61 They found that farm size was unrelated to farm productivity and capital, implying a misallocation of land. Overall, 78.3 percent of farmers in Malawi operate on less than 1 hectare and only 0.3 percent of the farms are larger than 5 hectares. The average plot size is 0.83 hectares. Land markets are practically nonexistent in the country, and most of the land is transferred through customary rights. This customary-based ownership and transfer system creates a misallocation of land, preventing more productive farmers from acquiring larger plots. An efficient redistribution of farm land would increase aggregate productivity by a factor of 3.6. This very large increase calls for the establishment of a land market in Malawi. Going forward, it will be crucial to harness the complementarity between smallholder and large-scale farming to reduce the overreliance on smallholders and expand much-needed commercial large-scale farming. Although a fringe of the latter offers mixed results about the complementarity between large-scale farming and smallholders, recent analyses suggest that there is room to harness such complementarity whereby large-scale farming can achieve better productivity. 62 Successful transformation of agriculture will require a recognition that, as stated by Collier and Dercon, smallholders are heterogeneous in potential and there is scope for large scale farmers as commercial enterprises, often in interaction with smaller scale farmers using institutional frameworks that encourage vertical integration and scale economies in processing and marketing. 63 If well regulated, large-scale farming could have positive spillover effects on smallholders including job creation, income generation, and the transfer of knowledge and know-how. The out-grower scheme model, where smallholder farmers supply products for a larger firm under pre-agreed mutually beneficial conditions, could be a potential mechanism to ensure such mutual benefits. This complementarity will be explored in the context of value chains, discussed in the next section. Enhancing the integration into agricultural value chains (AVCs) Increased globalization has created both challenges and opportunities for Africas agriculture these notably arise from the continents greater integration into AVCs. Thanks to globalization, African products can now reach larger markets. However, to take advantage of this potential, African farmers need to deliver higher-quality products at competitive prices and integrate international distribution channels by satisfying the norms and standards set out by their trading partners. 64 This is a serious challenge for smallholder farmers, who supply up to 80 percent of the food in sub-Saharan Africa, 65 but who need to enhance their capacity to meet international standards. Greater integration into AVCs is expected to boost benefits to small-scale farmers and facilitate the creation of agribusinesses for increased value addition in exported goods. The participation of small-scale farmers in AVCs will enable them to harness the interdependence among the different actors in the value chain, namely the suppliers of inputs and seeds, the farmers, the businesses providing technical support for the farmers such as agricultural machinery, the financiers, the wholesale producers of farm products, the processors, and associated sellers. 66 Consequently, participation in AVCs will facilitate small-scale farmers access to inputs, financing, and end-markets at the local, national, regional, and international levels, thereby enabling them to have a greater voice in the value chain and enhancing their economic returns. This will, in turn, facilitate the creation of modern integrated agribusiness value chain economies based on specialization. 67 Participation in such AVCs will enable firms to move up into higher-value activities, capture a greater share of value in global markets, and thus enhance the sectors competitiveness. 68 The discussion that follows will explore the potential of value chains to enhance Africas agricultural competitiveness. It reviews Africas global positioning as well as its potential integration into the global AVCs, which are both necessary for creating a conducive environment. The AfDB has made significant efforts to enhance the continents integration into AVCs, as discussed later in this chapter. Africas positioning and potential within global and regional value chains Even though Africas integration within global AVCs is limited, it offers scope for greater integration within the traditional cash-crop production chain. Africas general participation in regional and global value chain trade is discussed elsewhere in this Report (see Chapter 2.3 ). Participation in AVCs is even more challenging because international norms and standards keep evolving and are difficult to satisfy. Africa is a large global supplier of traditional cash crops (coffee, cotton, cocoa, sugar, tea, and tobacco) as raw material, which accounts for about 50 percent of Africas total agricultural exports. 69 These tend to be producer-driven chains with limited scope for functional upgrading, given the tight control by lead producers with higher-value activitiessuch as processing and manufacturingthat are carried out outside Africa. 70 Nonetheless, some scope exists for product differentiation and quality upgrading within the cash-crop production chains. In fact, product differentiation presents various opportunities for increasing agricultural income from cash crops, through branding and grading specialty coffee and establishing grading systems, for example, as well as by segregating different qualities for export. 71 The production of non-traditional crops, however, offers more scope for greater integration within the global AVCs. African economies have progressively diversified from the traditional cash crops and are increasingly engaged in the production and global sale of crops such as fruits, vegetables, fish, and flowers that belong to buyer-driven value chains. This has, in part, been the result of the proliferation of supermarkets seeking to consolidate their supply networks in order to exert more control over production processes. 72 Indeed, with Africas greater urbanization and growing middle class, rising consumption creates more demand for local products. 73 Functional upgrading can occur in such value chains as retailers seek ready-to-sell products more and more, thereby advancing processing and packaging activities further along the value chain. 74 Regional value chains offer great promise in facilitating the integration of Africas agriculture into global value chains and need to be supported. Meeting the standards required for integrating into global value chains will be a gradual process for Africas agriculture exporters. In the interim, gains can be made from integrating into regional value chains. Indeed, the agriculture sectors of some African countriesespecially Kenya and South Africa, which are major regional exporters of processed foodare increasingly being integrated into regional value chains. For instance, the Kenya fresh vegetable (especially green beans) and dairy export industries grew considerably in size and value-added in the 2000s and are now leading producers in Africa. This success is the result of the sound implementation of new processes and operations by private Kenyan businesses, as well as the support of the public sector. Given the nature of the smallholder-based agriculture in Africa, support will need to be provided to small-scale farmers to be better organized so as to enhance their productivity and ensure the timely off-take of produce from farm to markets. Indeed, the United Nations Economic Commission for Africa (UNECA) underlines the need to support small-scale producers through national and regional cooperatives or other farmer organizations in order to facilitate their access to inputs, financial services, and markets and to enable them to defend their interests in the value chain. 75 Five keys to a conducive environment for greater AVC integration This section presents five keys to creating an environment conducive to fostering greater AVC integration. First, the need to address poor domestic productive capacity and infrastructure in order to enhance Africas effective participation in value chains cannot be overemphasized. Africa is endowed with vast resources, but its low domestic productive capacity and poor infrastructure, as well as a focus on low-value-added activities, are holding back the continents effective participation in value chains. Indeed, Africas considerable endowments in natural resources and its competitive wages, as well as the significant potential of domestic and regional markets, have been well documented. 76 However, domestic productive capacity, in the form of skills and capital to produce on a large scale and meet required standards, is limited. The performance of the agriculture sector is also hampered by inadequate infrastructure, including unreliable energy, an ineffective urban-rural road network, inefficient ports, and a business and regulatory environment that overall is not conducive to doing business in agriculture make trade more costly. For instance, Bah and Fang show that, on average, Africas firms lose 25 percent of their output as a result of the poor business environment. 77 A 2009 report by the US international trade commission also shows that poor infrastructure (especially land and maritime transport and energy) is putting African exporters at a competitive disadvantage by increasing costs and compromising the quality of exports. 78 Addressing these shortcomings will be crucial for Africas beneficial participation in AVCs. Second, farmers need to be provided with appropriate financing schemes so they can make necessary investments and meet required standards for integration into global value chains. Limited access to finance hinders local farmers from undertaking the requisite investments to increase productive capacity and meet the quality requirements of integration into both regional and global value chains. 79 Aforementioned efforts at land reform, enabling farmers to have security of tenure, will need to be complemented by efforts to ensure that farmers are well organized through cooperatives, farmers unions, and associations to enhance their bargaining power, allowing them to obtain better financing terms. Improved organizational capacity on the part of farmers will also enable them to cooperate in working to meet the standards required for integration of value chains. Better access to financial facilities will need to be complemented by financial literacy training to avoid the over-indebtedness that accompanied the green revolution in Asia. Third, efforts should be made to encourage the connection of small-scale farmers with large commercial farmers through mutually beneficial contract farming (also called out-grower schemes ), thus enhancing the sectors inclusiveness. As large-scale farmers become better connected with AVCs, agribusiness initiatives will increasingly seek value additions to agriculture products and there will be a reduction in the export of raw material. In supporting these agribusiness initiatives, special attention should be given to out-grower schemes because they not only assist farmers to meet required production standards within the global value chain, but they also guarantee supply to leading firms. Contract farming usually involves a large agribusiness firm entering into contract with smallholder farmers, providing farmers with inputs on credit and extension in return for a guaranteed delivery of products. 80 Box 3 discusses the AfDBs role in supporting the transformation of Africas agriculture for inclusive growth. It provides some examples of inclusive AfDB projects in the agribusiness sector, including through private equity. Box 3: The AfDBs role in supporting the transformation of Africas agriculture for inclusive growth The AfDB Group has a long experience, going back to the late 1990s, of supporting African countries in developing their agriculture sectors. The AfDB views agriculture as key to the socioeconomic development of the continent. Between 2006 and 2014, the AfDB committed 198 operations in agriculture and agribusiness, amounting to a total of US6.33 billion. Prior to 2000, the AfDB endorsed the Integrated Rural Development approach to agriculture. In 2000, the AfDB adopted a new strategic framework embodied in the Agriculture and Rural Development Policy, which focused on addressing the critical bottlenecks of agricultural development, namely: high population growth rates, the poor state of infrastructure, declining trends in agricultural prices, persistent political instability, reliance on rain-fed agriculture, high post-harvest losses, the complex land tenure system, limited human and institutional capacity, and inaccessibility to credit. From 2010, the AfDBs operations in agriculture were guided by its Agriculture Sector Strategy (AgSS), covering the period 201014, with its principal objective being to guide the AfDBs operations to contribute to greater agricultural productivity, food security, and poverty reduction. Below are two examples of inclusive agribusiness projects supported by the AfDB. The Maryland Oil Palm Plantation Project (MOPP) is a US203 million agribusiness project. The AfDB approved US20 million for this project in 2013. MOPP entailed a 15,000 hectare greenfield palm oil plantation and milling project in Liberia. The nucleus plantation constituted 9,000 hectares, while 6,000 hectares were to be cultivated by local farmers in an out-grower scheme involving 600 farmers. These farmers are expected to receive financing for their inputs from MOPP, which they will repay once their product is sold. Access to modern inputs such as improved seed varieties and fertilizers, extension services, and access to finance is expected to improve the livelihood of these farmers. Approved by the AfDB in 2009, Agri-Vie is a US100 million private equity fund focusing on small - and medium-sized enterprises in the agribusiness and food sectors. The fund closed in 2010 with 65 percent of the commitments coming from development finance institutions and the rest from the private sector (life insurance, foundations). Agri-Vie has a proactive and collaborative relationship with investees and provides training and technology transfer to out-grower farmers. In terms of results, Agri-Vie has a continuous focus on driving selected impacts per investee in the following sectors: governance (reporting, policies, and controls), workers (employment, training, and development), and community relations and environment (environmental management practices). In terms of development outcomes, by the end of 2012, Agri-Vie Fund had impacted more than 890 small - and medium-sized enterprises, 2,900 farmers, and 312 non-farmer micro-enterprises. One of the feedbacks from the managers of Agri-Vie Fund is that investment in African food and agribusiness remains robust, which is an encouraging sign. Going forward, the new AfDB Agriculture Sector Strategy (AgSS) (20152019) will seek to build on previous AfDB work in agriculture by bringing the agriculture sector and agribusiness to the front of Africas structural transformation agenda. The AfDBs interventions within the framework of the AgSS for 201519 will be guided by two pillars: (1) agricultural infrastructure and (2) natural resource management. 3-1 The AgSS will embrace a value-chain approach and support innovative technologies to foster the development of value chains within the agriculture sector and its commercialization. It will promote agricultural commodity exchanges and improve access to finance for agricultural small - and medium-sized enterprises. It will also help to improve capacity building by providing specific vocational training to farmers and agricultural product dealers, for example. It will leverage mobile information services, allowing farmers to collect valuable data. It will promote best practices for investments in land, ensuring that private investments benefit rural communities. It will also pay greater attention to increasing gender mainstreaming in the AfDBs operations and programs. 3-2 The key features of the AgSS for 201519 are highlighted below. Infrastructure in agriculture: Supporting regional member countries to develop their infrastructure systems in the agriculture sector, including improving rural infrastructure, rural electrification, irrigation, water management, and leveraging information technology systems for agriculture development Agribusiness and innovation: Supporting the development of agribusiness and innovation, which includes commercializing agriculture by developing the agro-industry and value chains implementing measures to enhance agricultural trade, including promoting commodity exchange markets in the agriculture sector and developing low-cost technologies for primary processing that retains essential nutrients and Resilience and natural resource management: Promoting resilience and the sustainable management of natural resources, including managing the environmental impact of agriculture activities. Sources: AfDB, 2010 AfDB 2015, forthcoming. Compiled from the AfDB investment portfolio. Fourth, ICTs play a key role in fostering greater integration into value chains. As noted earlier, ICTs can reduce information asymmetry and improve market efficiencies throughout the different phases of the production process as well as in the post-harvest period. These information asymmetries extend beyond the local market into regional and global markets. ICTs can be employed to improve the marketing of agricultural products into regional and global markets, while at the same time being used to receive market information in a timely manner. Last, state intervention is crucial in supporting greater value chain integration. In the majority of poor development outcomes, coordination failure is one of the main culprits. As previously discussed, better integration into AVCs can be attained by organizing smallholder farmers in cooperatives and groups. African governments can play a vital role in facilitating the formation of those networks. Services can be leveraged for this purpose and provide information on how to better integrate AVCs. Governments should also invest more in infrastructure to improve the business climate, as its current state represents a significant competitive disadvantage for African exporters. International organizations can also help to correct coordination failures by bringing different stakeholders together and by boosting inclusive investments in the agriculture sector (see Box 4). Box 4: Grow Africas approach to developing responsible, sustainable, and inclusive private-sector investment Since its inception in 2011, Grow Africaa partnership platform created to catalyze investment and growth in African agriculture, founded by the African Union Commission, the NEPAD Agency, and the World Economic Forumhas established itself as a trusted platform for increasing responsible, sustainable, and inclusive private-sector investment in Africas agriculture. The network collectively works to ensure that investment commitments made by international and domestic companies in partnership with national governments are converted into investment on the ground. These investments are expected to increase farmers income and create local jobs. One of the most important aspects of the Grow Africa Secretariats work is using its convening power at the highest levels to support the development of strong, effective multi-stakeholder structures to enable the public and private sectors to work together to drive investments forward. The creation of a better coordination between private-sector agricultural companies and the public sector is a significant step toward accelerating the execution of investment commitments and bringing them to scale. Better coordination and alignment is required among different private-sector players, agribusinesses, and smallholder suppliers. Grow Africa is active in exploring, incubating, and disseminating best practice in innovative models for ensuring sustainable supply chains involving smallholder farmers. Agricultural corridors and agri-processing zones that coordinate investments into geographically targeted value-chain clusters can significantly speed up the implementation time for the individual investments within these geographic areas. To further these efforts and locate them on the global stage, in 2015, the World Economic Forum is introducing a Global Challenge Initiative on Agriculture and Food Securityone of ten institutional initiatives addressing major issues of global concern. 4-1 The initiative builds on the work of the New Vision for Agriculture, 4-2 and is intended to strengthen leadership commitment and catalyze country-led action partnerships, such as Grow Africa. Source: Grow Africa Secretariat. Recommendations and conclusions This chapter recalls the main factors that make agriculture in Africa one of the least productive globally while the rest of the world, particularly Asia, greatly benefited from the green revolution. The chapter also discusses the ingredients needed for a more competitive agriculture sector that will lead to faster structural transformation processes across Africa. Agriculture remains an important source of income for the majority of Africans and represents a large share of economic output in most countries in the continent. The sector consists primarily of small-scale farmers who cultivate a large variety of low-yield crops on small plots of non-irrigated land, using a minimal amount of fertilizers and pesticides. These characteristics make the sector very unproductive, leading to food insecurity and large imports of staple foods. The continent has not benefited from the green revolution that started in the 1960s, and that essentially focused on Asia and Latin America. The African continent was left behind for several reasons: (1) the development of high-yield crops focused on irrigated rice and maize, crops not very suited for African soils and ecological systems (2) market failures and infrastructure deficits have constrained the availability and access to productivity-enhancing inputs as well as the commercialization of agricultural production in Africa and (3) policy and institutional factors, characterized by the inefficient involvement of governments that resulted in distorted prices of both agricultural inputs and outputs as well as in low levels of technological innovation and adoption. In contrast to Africa, Asian governments have been heavily involved in the drive to revolutionize their agriculture sectors. In order to foster Africas green revolution, it is essential to address the factors above and simultaneously take into account the specificities of African conditions, including the continents variety of soils and appropriate crops. This will involve increased international and national research to develop and promote high-yield crops suitable for Africa. While international research efforts have greatly increased in recent years, national governments are failing to reach their target of devoting 10 percent of national spending to agriculture as agreed under the terms of the NEPAD-CAADP. Increased national spending should support better water management to intensify irrigation, reduce the continents dependence on rain-fed agriculture, and increase resilience to climate change. Moreover, governments need to put in a place a sound regulatory and institutional framework to minimize distortions and take advantage of new opportunities provided by the development of science and technology. Innovations in ICTs have several agricultural applications involving different stakeholders at different stages in the production cycle. Diffusion of market information, production knowledge, and geographical information are among the top applications that are being increasingly used in Africa but whose usage could be further enhanced. Since the large majority of scientists believe that GM crops are safe to eat, the technology has the potential to revolutionize Africas agriculture. Improved yield and resistance to pests can increase farmers income. However, skills in biotechnology are needed for a wide-scale adoption across the continent, as well as regulatory systems that ensure health and environmental safety and provide accurate information to farmers and customers. Taking full advantage of these technologies will require a number of countries to improve their land governance systems. Land access based on customary rights that disadvantage women, unequal distribution, and the absence of land markets are preventing the most efficient farmers from the opportunity to increase their production scale. Moreover, insecure land tenure limits farmers ability to use their land as collateral and thus to access credit markets. Land reforms accompanied with the development of financial instruments suited to the agricultural production cycle will improve the adoption of technology and expand the use of intermediate inputs. Finally the chapter acknowledges the potential of Africas agriculture and proposes mechanisms by which it can benefit from integration with regional and global markets. Indeed, integration in AVCs will help small-scale farmers adopt better production processes and garner higher prices for their produce. It also provides them with the opportunity to be linked with large-scale agribusinesses and diversify to higher-value crops, such as fruits, vegetables, fish, and flowers. However, meeting the high-quality standards in world markets is not easy, particularly for small-scale farmers. Thus regional AVCs can provide a stepping-stone that allows farmers to improve their production and marketing processes. This requires small-scale farmers to be better organized, for example in farmers organizations, and to link up with large-scale agribusinesses through out-grower schemes that establish production contracts between agribusinesses and small-scale farmers. Indeed, this has been promoted by the AfDB as a way to enhance inclusiveness as the sector increases the share of large-scale commercial farming. Strong support from governments and international organizations will minimize coordination failures among stakeholders and ensure that increased integration into AVCs benefits small-scale farmers, particularly women who represent a significant share in the agricultural employment breakdown. References Adamopoulos, T. and D. Restuccia. 2014. Land Reforms and Productivity: A Quantitative Analysis with Micro Data. Working Paper 525. Toronto: University of Toronto, Department of Economics. AfDB (African Development Bank). 2010. Agriculture Sector Strategy 20102014. Tunis, Tunisia: AfDB. . 2013. At the Center of Africas Transformation: Strategy for 20132022. Tunis, Tunisia: AfDB. Available at afdb. orgfileadminuploadsafdbDocumentsPolicy-Documents AfDBStrategyfor2013E280932022-AttheCenterofAfricaE28099sTransformation. pdf . . 2014. Global Value Chains and Africas Integration into the Global Economy. Chapter 2 in Annual Report 2013. Tunis, Tunisia: AfDB. . 2015, forthcoming. 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ARPN Journal of Agricultural and Bioscience 6 (9): 3949. Klmper, W. and M. Qaim. 2014. A Meta-Analysis of the Impacts of Genetically Modified Crops. PLoS ONE 9 (11). Lapp, F. M. J. Collins, and P. Rosset, with L. Esparza. 1998. World Hunger: Twelve Myths, 2nd edition. New York and London: Grove Press and Earthscan. Lee, J. G. Gereffi, and J. Beauvais. 2012. Global Value Chains and Agrifood Standards: Challenges and Possibilities for Small Holders in Developing Countries. Proceedings of the National Academy of Sciences of the United States of America 109 (31): 1232631. Available at pnas. orgcontent1093112326.full. pdf . Leke, A. S. Lund, C. Roxburgh and A. van Wamelen. 2010. Whats Driving Africas Growth. Insights amp Publications, McKinsey Global Institute. Lewin, A. 2007. Zambia and Genetically Modified Food Aid. Case Study 4-4 of the Program: Food Policy for Developing Countries: The Role of Government in the Global Food System. Ithaca, New York: Cornell University. NEPAD (the New Partnership for Africas Development). 2013. Agriculture and Africa: Transformation and Outlook. Johannesburg, South Africa: NEPAD. Nin-Pratt, A. M. Johnson, and Y. Bingxin. 2012. Improved Performance of Agriculture in Africa South of the Sahara: Taking Off or Bouncing Back. IFPRI Discussion Paper 01224. Washington, DC: International Food Policy Research Institute. Nin-Pratt, A. and L. McBride. 2014. Agricultural Intensification in Ghana: Evaluating the Optimists Case for a Green Revolution. Food Policy 48: 15367. Nuffield Council on Bioethics. 2003. The Use of GM Crops in Developing Countries: A Follow Up Discussion Paper. Available at nuffieldbioethics. orgprojectgm-crops-developing-countries . Pabra (Pan-Africa Bean Research Alliance). No date. Available at pabra-africa. orgimpact. accessed March 23, 2015. Restuccia, D. and R. Santaeulalia-Llopis. 2015. Land Misallocation and Productivity. Working Paper 533. Toronto: University of Toronto, Department of Economics. 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In Geographical Information Systems: Principles, Techniques, Management and Applications, 2nd edition. Longley, P. A. M. F. Goodchild, D. J. Maguire, and D. W. Rhind, eds. New York: Wiley. World Bank. 2008. World Development Report: Agriculture for Development. Washington, DC: World Bank. . 2015. World Development Indicators (online). Washington, DC: World Bank. World Economic Forum, African Development Bank, and the World Bank. 2013. African Competitiveness Report 2013. Geneva: World Economic Forum. You, L. C. Ringler, U. Wood-Sichra, R. Robertson, S. Wood, T. Zhu, G. Nelson, Z. Guo, and Y. Sun. 2011. What Is the Irrigation Potential for Africa A Combined Biophysical and Socioeconomic Approach. Food Policy 36: 77082.How to Invest on the Johannesburg Stock Exchange South Africa is far and away the most economically developed of African states, and, as such, will likely be the continent8217s economic gateway for the foreseeable future. Sannheten blir fortalt, men Johannesburg-børsen (JSE) isn8217t er akkurat det mest bullish markedet i dag. MSCI Sør-Afrika-indekset har sunket mer enn 13 i løpet av de siste 12 månedene etter å ha regnskapet for avskrivninger av nasjonal8217s valuta, rand. Faktisk er markedet nå på sitt laveste punkt i nesten to år. Men dette er nødvendigvis dårlige nyheter for verdifall investorer. Fallende priser betyr at flere og flere tilbud er tilbudt. Gevinstmultipler faller og utbyttene øker. Og fordi Johannesburg-børsen er en av de mest sofistikerte i verden, kan investorer scoop opp disse avtalene med et klikk med musen. Market8217s tilgjengelighet og bekvemmelighet gjør det til et ideelt sted for nye Afrika-investorer å få føttene våte. Here8217s hvordan komme i gang. Sammenligning Shop South African Stockbrokers Ditt første skritt er å åpne en konto hos en sydafrikansk aksjemegler. Tusenvis av aksjemeglere letter handel på JSE, men bare 12 tilbyr online aksjehandel til individuelle investorer. Online handelsplattformer er fortsatt relativt nye for Afrika, og de er ikke en nødvendighet for å investere vellykket der, men jeg finner dem mer praktiske. Så begrenset jeg meglerforskningen til de som tilbyr dem. Jeg sendte en e-post til hver enkelt og spurte om de så på utenlandske investorer, hvor mye av et innskudd de måtte åpne en konto, hvilken dokumentasjon var nødvendig, og for en kopi av deres gebyrplan. Fem av meglerne bekreftet at de tar utenlandske kunder og svaret på mine spørsmål innen tre virkedager. I8217ve noterte dem under med deres minimale innledende innskudd, månedlige administrasjonsgebyrer og min beregning av kostnaden for en hypotetisk ZAR20.000-handel gjennom hver enkelt. Minimum innledende innskudd Månedlig administrasjonsavgift ZAR50.00 (omtrent 5,00) eller månedlig megling over ZAR300.00 (omtrent 30,00) ZAR235,96 (omtrent 23,00) Som du ser, er provisjoner og avgifter ganske sammenlignbare på alle fem meglere, men Anglorand krever et mye større innskudd enn sine jevnaldrende. Vær oppmerksom på at for sørafrikanske innbyggere er merverdiavgift lagt til mange av de ovennevnte elementene. Hvis du ikke er bosatt i Sør-Afrika, bør du ikke bli belastet merverdiavgift (mva). Hvis du gjør mye handel, kan dette være en betydelig kostnad, da det utgjør 14 av megler og avgifter. Så hold øye med dine handelserklæringer og spør megleren om å refundere eventuelle moms hvis det skulle vises. Diskresjonær og ikke-skjønnsmessige kontoer Vær oppmerksom på at noen av disse meglerne tilbyr diskretionære kontoer. Diskresjonskonto gir meglere fullmakt til å gjøre handler i kontoen din uten samtykke fra kontoinnehaveren. De styres vanligvis på en måte som megleren mener er den beste måten å oppnå investeringsmålene og akseptable risikonivåer du angir. It8217s liker å ha din egen personlige porteføljeforvalter. Du vil kanskje vurdere dette alternativet hvis du er interessert i å gjøre din egen investeringsforskning. I8217m litt kontrollfreak, så jeg foretrekker ikke-diskretionære kontoer. Jeg vil lage mine egne investeringsbeslutninger og don8217t som ideen om at en megler kunne kjøpe eller selge aksjene mine uten min tillatelse. Hvis du i det hele tatt liker meg, må du sørge for at du åpner en ikke-diskretionær eller 8220execution only8221-konto. Hvilken dokumentasjon vil du trenge Å åpne en konto, være forberedt på å gi følgende: Sertifisert kopi av passet ditt Bankinformasjon (dvs. en kansellert sjekk eller en sertifisert kopi av en nylig kontoutskrift) Kopi av en nyhetsregning som viser din fysiske adresse (ikke eldre enn tre måneder) Signert brev til megleren som sier at du ikke er registrert hos South African Revenue Service for skatt i Sør-Afrika (noen meglere kan kreve ditt personnummer) Du må også fylle ut et skjema eller tre for megler som du vil åpne en handelskonto med. Here8217 er en rundown om hva annet er nødvendig av hver enkelt. Anglorand krever fullføring av et 12-siders handelsmandat (bare de første seks er nødvendige for ikke-skjønnsmessige kontoer) og en tre-siders opplysningsplan. Imara SP Reid8217s søknad er et 14-siders monster. Heldigvis kan individuelle investorer som ønsker å administrere egne kontoer, hoppe over mange av seksjonene. Nedbank, PSG Online, og Sanlam iTrade alle tilbyr nifty online registreringsprogrammer. Finn Nedbank8217s her, PSG8217s på denne linken. og Sanlam iTrade8217s her. How to Fund Your Brokerage Account After opening your trading account, your broker will provide you with its bank details so that you can fund your account and begin buying shares. Den mest effektive måten å gjøre dette på er via bankoverføring. Hvis du ikke har sendt en internasjonal ledning før, foreslår jeg at du tar dine bankers bankdetaljer til din lokale bankkontor og ber dem om å gå gjennom prosessen. De vil sørge for at pengene dine kommer sikkert. Vær oppmerksom på at de fleste amerikanske banker tar ut 25 kroner for utgående internasjonale ledninger. Gjør en handel Den faktiske prosessen med å handle, varierer avhengig av megleren du bruker, men fra det jeg ser at deres handelsplattformer ser ganske intuitivt ut. Du kjøper og selger bare aksjer på samme måte som du ville gjennom en ETrade eller TDAmeritrade-konto. Innsamling av utbytte Etter min erfaring er det å samle utbytte betalt av Sør-Afrikas aksjer et stykke kake. Hvis du kjøpte aksjene via en nettbasert megler, vil utbyttet bli deponert direkte på din handelskonto. Du kan da bestemme om du skal ta med kontanter hjem eller for å reinvestere dem i markedet. Klar som Mud Har du spørsmål om å investere i Johannesburg børsen som vi har hatt? Her er det lett å høre dem i kommentarene Relatert Reading I8217m en ung profesjonell som ønsker å begynne å investere i aksjemarkedet. En kollega har fortalt meg om satrix og at de tilbyr minimumsrisiko for investorer. Er det trygt i denne dag og alder med økonomien vår så svak å begynne å investere og er satrix et godt valg for en nybegynner som meg. Din kollega styrer deg i en lydretning, etter min mening. Satrix tilbyr en rekke ETFer og fondskasser som bidrar til å diversifisere risikoen, samtidig som kostnadene blir lave. Det er ikke mange gode økonomiske nyheter som kommer ut av Sør-Afrika i disse dager, men det er viktig å ta en langsiktig utsikt. I8217d anbefaler at du investerer et lite, angitt beløp med jevne mellomrom (månedlig eller kvartalsvis) i en diversifisert enhet, mens du får føttene våte. Satrix tilbyr to godt diversifiserte fondskasser som du kanskje bør vurdere (satrix. co. zaproductsunittrusts. aspx). Det Balanced Index Fund er diversifisert over Sør-Afrika og utenlandske aksjer, obligasjoner og eiendom. The MSCI World Equity Index invests in the world8217s largest companies, including Apple, Exxon, Google, and Microsoft and has very little exposure to the South African economy. Håper dette hjelper og holder oss oppdatert på hvordan tingene går for deg Ryan Ryan Jeg har et spørsmål å spørre. Er det mulig at mens du investerer på JSE at en person kan bli betalt fra renten på investeringen månedlig, sier Ryan Hoover Bra spørsmål. Ja, det er noen midler som betaler en månedlig fordeling til sine investorer. Du kan finne en liste over noen av dem i denne artikkelen: Happy investing Ryan Jeg eier noen sydafrikanske aksjer, notert på JSE, sertifikatene ble utstedt i Sør-Afrika, kan jeg handle dem gjennom en kanadisk megler. Det ville være verdt å spørre dem, men jeg mistenker at svaret vil være enten 8220no8221 eller bare for et veldig stort gebyr. Takk. De aktuelle aksjene er notert på NY-børsen. gjør det noe som kan gjøre det enklere, og det er definitivt verdt å ringe til dem. Du kan også sjekke med en amerikansk megler, men I8217m gjetter deg, du må sannsynligvis jobbe med en sydafrikansk megler. Hold oss ​​oppdatert på hvordan ting går Hva økonomisk kvalifisering har du Årsaken jeg spør om er at du svarer på alle spørsmålene riktig. Vennligst send meg din e-post, jeg tror at du vil kommunisere med deg, vil være til stor hjelp når du skal investere. I8217m driver for tiden forskning på investeringer og tenker at som nybegynner bør vi starte med kollektive investeringer som ETFS eller Unit Trusts for en liten sum penger før de håndterer vanlige aksjer. Ser frem til ditt vennlige samarbeid. Dee wright sier at hvis du har aksjer i et selskap som selskapet ble avregistrert. Kan du gi råd om hva som skjer med pengene du har investert i firmaet. Kan du pls anbefale en god aksjehandel trener jeg kan finne rundt durban, klarert one. really vil gjøre dag handel Takk for ditt spørsmål, Ndumiso. Jeg anbefaler ikke dag-handel. Det er høy risiko og høy stress. Svært mye som gambling. Din sjanse for å tjene penger på aksjer er best når du fokuserer på grunnleggende for den underliggende virksomheten. Tenk på deg selv som eier, og kjøp en bedrift som er lønnsom, med lav gjeld, og det er lett å forstå. Deretter holder du på aksjene og la virksomheten jobbe for deg. Alle de beste Ryan Ryan, takk så mye for innlegging Jeg lurte på hvordan å gjøre slike investeringer som Bonds og CD8217s (hvis tilgjengelig) med forskjellige FI8217s i Africa8230 Er det spesielt en institusjon som du anbefaler Er det meglere som du kan anbefale. Er prosessen den samme som den er her i USA. Vi kan for eksempel gå inn i B av A (uten megler) og åpne en CD eller Bond. Tusen takk for infoen. Jeg kom over info mens jeg gjorde min forskning om å investere i aksjer. Jeg vil gjerne finne ut om man bestemmer seg for å åpne en konto hos kanskje Nedbank-meglere, har man mulighet til å kjøpe aksjer som Calgro M3. Hva jeg mener er, begrenser det deg bare til fondskasser. Ja, du kan kjøpe aksjer av Calgro M3 (en av mine favoritt Sør-Afrikanske aksjer, btw) eller et annet JSE-børsnotert selskap gjennom en megler som Nedbank. De vil ikke begrense deg til unit trusts. Flott spørsmål og glad å investere Ryan Mange takk, Ryan. En annen, jeg har en tillit som jeg sporer hver dag. One day it goes up with R5 or more. Neste dag er it8217s lavere. Jeg klarer ikke å forstå hvordan det fungerer. Si at jeg vil selge mine enheter, kommer de med en viss pris jeg ikke vet om, eller vil jeg få ut av balansen som jeg ser hver dag jeg elsker nettstedet ditt, Ry. Et annet utmerket spørsmål, Brenda. Takk Unit trusts er en samling av aksjer i mange forskjellige selskaper. Hver dag er børsen åpen, folk kjøper og selger disse aksjene. If the news about a certain company is good, the price of its shares will typically rise because investors believe that the company is more valuable than they previously thought. Og hvis nyheten er dårlig, vil prisen på aksjene vanligvis falle. Det er litt som å eie en ku eller en hest. Hvis naboen din ser at kua blir veldig sterk, sunn og produserer mye melk, vil han nok være villig til å betale deg mer for det. Hvis han imidlertid ser at kua blir syk eller tynn, vil han være villig til å betale så mye. En tillitstjeneste er som en flokk med kyr. Hver enkelt ku (eller andel) har sin egen verdi. For å bestemme verdien av hele besetningen (eller fondet), summere du verdiene for alle de enkelte kyrene i besetningen. Og fordi verdien for cows8217 (shares8217) endres på daglig basis, gjør det også verdien av hele flokken (eller investeringsfond). Så når du selger dine enheter, vil du selge til den prisen som investorer tror at de underliggende aksjene i din tillit er verd på den aktuelle dagen. Å være fransk og bor i Sør-Afrika lurte jeg på to ting. 1. Er det mulig å eie en aksjekonto eller å gjøre online aksjeforbindelse knyttet til en bedriftskonto. Ideen ville være å eie aksje via mitt konsulentfirma. En måte å investere fortjenesten til firmaet mitt. 2. Er det mulig via de anbefalte meglerne å eie aksje på andre markeder. Kina, Nigeria, Ghana, Frankrike, USA. Tusen takk for svaret Hei Ryan, på listen over dok krav for å åpne en konto, sier en av dem, 8216signed letter til state one er ikke registrert hos SARS for tax8217 8230. Jeg skjønner ikke hva som ville skje hvis man er Jeg har en skatt ref nr 038 registrert. Artikkelen er skrevet ut fra et ikke-sørafrikansk perspektiv. Hvis du er sørafrikansk og registrert hos SARS, må du bare levere megleren med skattenummeret ditt når du blir bedt om det. Xforex er et program for å spekulere på valutabevegelser. Dette innebærer høy risiko og jeg anbefaler ikke å inkludere det i din investeringsmetode. Mye bedre å investere i aksjer i et godt selskap til en rimelig pris og holde dem på lang sikt. Håper dette hjelper og glad å investere Ryan, jeg vil virkelig sette pris på din hjelp i det følgende. Jeg kjøpte aksjer i protea beholdninger i 1973, jeg mistet sertifikatene, og etter flere husbevegelser fant jeg dem igjen. Jeg vil gjerne vite hvordan jeg skal hente utbyttekontroller over alle disse årene og også hvordan jeg selger bedriften min. Takk i påvente. Jubel. Alan That8217 er en tøff en. Som jeg forstår, ble Protea Holdings kjøpt av Malbak-gruppen i midten av 1980-tallet. Malbak ble til slutt kjøpt av Nampak for omtrent ti år siden. Massevis av akselerasjon skjedde underveis. Din beste ressurs for å spore ned verdien av aksjene dine og eventuelle utbytte på grunn av deg, vil være en lokal aksjemegler. Du kan prøve en av meglerne som er oppført i artikkelen over, eller velg en fra denne listen. Hvis du kan finne en megler som er villig til å hjelpe, kan du kontakte Nampak8217s deltaregistrator. Deres detaljer er: Computershare Investor Services (Pty) Ltd 70 Marshall Street Johannesburg 2001, Sør-Afrika (postboks 61051, Marshalltown 2107) Telefon 27 11 370 5000 Telefaks: 27 11 370 5487 Håper dette hjelper og vennligst gi meg beskjed om hvordan det fungerer Hei Ryan, takk for ditt råd. Jeg vil holde deg informert om resultatet. Jubel. Alan Ryan Hoover says Thanks for your question and congratulations on what I presume is your retirement As you plan your next steps, you will first need to be clear on your average monthly living expenses. Følgende artikkel kan hjelpe deg med det. Når du vet hvor mye du bruker i en gjennomsnittlig måned som pensjonist, vil jeg legge til side 12 måneders levekostnader på en sparekonto på din bank. Disse pengene skal være tilgjengelig for deg innen en dag eller to. Så hvis du for eksempel tilbringer totalt R10 000måned på bolig, mat, medisin, transport osv., Foreslår I8217d å sette R120.000 i en spare - eller kontokonto. Sett deretter til side pengene du trenger over de neste 2 8211 5 årene i tidsbegrensede sparekontoer eller CDer. Capitec Bank har noen fine alternativer her: capitecbank. co. zaglobal-onesaverates-and-fees. Hvis de gjennomsnittlige månedlige levekostnadene dine er R10 000, vil jeg sette R120 000 i en 12 måneders innskuddskonto, R120 000 i en 24 måneders innskuddskonto, R120 000 i en 36 måneders innskuddskonto, R120 000 i en 48 måneders innskuddskonto og R120 000 i en 60 måneders innskuddskonto. Med de midler du har igjen etter det, vil jeg foreslå å investere i et børsnotert fond (ETF) som gir litt utbytteinntekt. Here8217s en som investerer i en kurv av JSE8217s mest konsistente utbyttebetalende aksjer: Dette vil bidra til å diversifisere risikoen din samtidig som du fortsatt gir deg muligheten til å investere i aksjemarkedet. Jeg håper dette hjelper og det aller beste for deg Lumela hle Ryan Vil også gjerne begynne å investere og en megler sa at A-programvare koster R16 000, og hvis jeg begynner å kjøpe aksjer for rundt R3000, vil et beløp bli rundt R900 per måned som kan være i stand til å betale min gjeld hvis jeg sier et lån 8211 fortalte dem at jeg ikke vil ha et lån eller kreditt ville enten starte med en engangsbeløp eller en månedlig debet. Vennligst råd som jeg ville elske å begynne å investere handel i JSE-jeg har ikke gjeld og vil ikke ha noe. Hvordan fungerer denne programvaren. Tx på forhånd .. Ryan Hoover sier Khotso, Alina Ho joang Jeg vil sterkt råde deg til ikke å gjøre forretninger med denne megleren. Det høres ut som en svindel. There is no reason for you to spend any money on software to begin investing, let alone R16,000. Og jeg kommer til å bli stump, hvis noen forsikrer deg om R900 per måned på et beløp på R3000, lyver de eller bare ikke vet hva de snakker om. Kjør vekk fra denne megleren, Alina. Kjør bort Hvis du vil begynne å investere. Den billigste og mest effektive måten å gjøre det på er å åpne en konto hos en av de anerkjente meglerne som er nevnt ovenfor. Deretter investerer du i en bredt diversifisert ETF, som Satrix 40. Dette vil tillate deg å begynne å investere samtidig som risikoen og utgiftene dine blir lave. Etterhånden som du lærer mer om å investere i aksjer, kan du begynne å investere i enkelte selskaper. Men mitt råd er aldri å betale ALDRI for 8220trading software.8221 Håper dette hjelper og takk for spørsmålet Takk så mye for infoen, kea leboha Ntate8230 plz avklare om du sier at jse har mistet 11 slik at en investering på 1000 er nå verdt 890 å ha mistet 110.-et eksempel. Jeg trodde et tap eller avkastning på investeringen avhenger av ytelsen til den aktuelle aksjen du kjøper, og ikke på den samlede ytelsen til bytte eller mer nøyaktig hvordan fungerer det generelle resultatet av utvekslingen. det vil si en innvirkning på en bestemt investering eller aksjeselskap, ja det kan ha gått dunk av watever men can8217t Jeg kommer fremdeles seirende ut hvis jeg plukket en velstående lager. Hopp du får driften av mitt spørsmål. Thanks Ryan Hoover sier stort spørsmål, Mvelo. Du er riktig. Det er mulig at enkelte aksjer kan øke i verdi samtidig som markedet (i gjennomsnitt) mister verdi. Når vi sier at JSE har mistet 11, refererer vi til JSE8217s All Share Index, som er et mål for resultatene av alle aksjer som handler på børsen. Jeg har blitt brent så mange ganger fyr. Jeg har sliten alle slags penger å lage ordningen. Fra min erfaring investeringer som lover garantert avkastning på 10 eller flere er svindel. Investeringer som ber deg om å kjøpe noe på forhånd, de er svindel. Som de som ber deg om å kjøpe R18000 programvare. Du kan gjøre grunnleggende og teknisk analyse med gratis nyhetssider som fin24.co. za bloomberg Reuters. Når du starter som noen investor, hold kostnadene for å bruke minimal informasjon gratis på nettet når du har gjort noe overskudd, du kan investere i hva Ryan tilbyr som Stock Scout. Gutter tror meg det er mye svindel ponzi ordningen der ute. Siste er kipi, upliftingsa. org. Bare søk co HYIP på Google du vil søke mye svindel med høy avkastning. Hvis du er base i Sør-Afrika, vil jeg foreslå å bruke easyequities. co. za. Its similar to what big for banks offer in terms of online stock trading. Hovedforskjellen er det ingen månedlige avgifter, og du har tilgang til JSE-børsnoterte selskaper. Hvis du liker å investere som meg, vil jeg gjerne danne en slags klubb hvor vi deler ideer. Jeg fokuserer nå bare på lang sikt. Min e-post: ndlovu2nsGmail Ryan Hoover sier Mange takk for dette, Nhlanhla EasyEquities. co. za ser ut som et godt, rimelig alternativ for å begynne å handle. Hei Ryan. Hvor fort etter investeringen begynner man å motta utbyttene som utbetales av selskapene som er oppført på JSE Ryan Hoover, sier Great Question. Noen selskaper betaler utbytte to ganger per år (hvert halvår), noen betaler kun en gang, og noen betaler ikke noe utbytte i det hele tatt. Hvert selskap har en annen tidsplan for når de gjør betalinger. Foschini, for eksempel, vil gjøre mid-års betaling på fredag ​​8. januar. Deres endelige betaling vil bli utstedt omtrent seks måneder fra nå. Vær oppmerksom på at du ikke kan kjøpe aksjer i Foschini i dag og regner med å motta et utbytte på fredag. I de fleste tilfeller må du være på rekord som aksjonær omtrent en måned før betalingsdagen for å motta et utbytte. Så, før du kjøper aksjer i et selskap, ta en titt på 8220Investor Relations8221 delen av selskapets 8217s nettsted. Dette vil typisk gi informasjon om selskapets utbyttepolitikk. Håper dette hjelper og gledelig å investere Hva er andelen av hele Sør-Afrikas befolkningshandel i JSE Ryan Hoover sier At8217 er en tøff. Jeg bekjenner at jeg ikke vet, men jeg mistenker at det er en ganske liten prosentandel som direkte handler på JSE. Et langt større antall har imidlertid eksponering mot JSE via pensjons - og spareplaner. Charl Badenhorst sier Hei Ryan Det ser ut til at du ikke er så opptatt på 8220day trading8221. Tilgi min uvitenhet da jeg bare har aksjer som ble utstedt til meg som en del av min ansettelsespakke. Det er min forståelse at hvis jeg investerer på lang sikt, kan jeg bare dra nytte av veksten av andelen over den perioden 8211 sier 5 år. Det betyr at jeg bare vil kunne bruke pengene jeg laget etter 5 år til å kjøpe flere aksjer og vente ytterligere 5 år for at de skal vokse. Jeg vil trenge en primærinntekt med litt penger igjen i slutten av måneden for å fortsette å kjøpe aksjer. Hvis jeg ikke har ekstra penger, kan jeg ikke kjøpe8230. Mens dagens handel bør (hvis jeg gjør det riktig) få liten fortjeneste hver dag som jeg så kan bruke til å investere 8211 over 5 år eller fortsette dagshandelen. I8217m Jeg savner poenget jeg vil pensjonere om 5 år og vil fortsette å spille på aksjemarkedet 8211 JSE som jeg er en sydafrikansk statsborger. Takk for den fantastiske snakkesiden. Charl Ryan Hoover sier godt spørsmål, Charl. Problemet med dagshandelen er at en aksje på en gitt dag har en god 50-50 sjanse for å gå opp eller ned i verdi 8211 som å flippe en mynt. Problemet er at du må betale en liten provisjon til megleren hver gang du utfører en handel. Derfor, bare for å bryte jevn, må du være riktig betydelig oftere enn you8217re feil. Bare heldig lykkes med å gjøre dette. It8217s very similar to a trip to the casino. I kontrast, når du holder en andel på lang sikt, opptrer du mer som deltakeren til en bedrift. Hvis du for eksempel betaler en rettferdig pris for aksjer i Woolworths, og den underliggende virksomheten fungerer bra, vil sjansen for at aksjekursen stiger i løpet av de neste månedene og årene være til fordel for deg. Videre betaler du megleren kun to ganger 8211 når du kjøper aksjene og igjen når du selger dem 8211 som holder kostnadene lave. Aksjekurser stiger noen ganger raskt til verdsettelser så optimistiske at det er fornuftig å selge aksjene dine etter å ha holdt dem i bare noen få måneder, men generelt bør folk forberede seg til egne aksjer i et gitt selskap i 5-10 år for å gi seg de beste sjansene for gjør en anstendig retur. I ditt tilfelle kan du vurdere å investere i aksjer som betaler et konsistent utbytte. Noen JSE-noterte aksjer betaler utbytte hvert år, og hvis selskapet er lønnsomt, øker utbyttet ofte fra år til år. Disse utbyttene blir betalt som kontanter på din handelskonto for at du kan trekke tilbake eller reinvestere i nye aksjer slik som du finner det. Håper dette hjelper og mange takk for det store spørsmålet, Charl Hi Ryan Jeg er en selvstendig næringsdrivende ung kvinne, jeg er interessert i denne børsvirksomheten, saken er I8217m gjeldfri, I8217m planlegger bare å kjøpe et hus som I8217m i prosess, problemet er at jeg mottar mye penger på en gang som I8217m i konstruksjon, jeg jobber med min sparing, slik at fortjenesten jeg får 50 prosent av det, ender jeg med å bruke det uforsiktig. Jeg vil investere let8217s sier at jeg bruker 20000 en måned uten besparelser for virksomheten, hvor og hvordan starter jeg i tillegg til bankene som megler kan hjelpe til på lang sikt, og jeg vil også investere for min sønn er 15 år også på lang sikt fordi jeg vil at han skal starte en bedrift på 21 yrs. Jeg vet ingenting om dette, vennligst hjelp. men siden din er god, takk på forhånd. Jeg er i Afrika. Jeg og min mann vi ønsker å handle med JSE, men vi fant upålitelige meglere. Vi investerte med en av Jse meglere Nov 2014 ingen uttalelse når vi google vi kan ikke få dem lenger. Hjelp oss, vær så snill, Ryan Hoover sier at jeg er lei meg for å høre det, Tshedi. Jeg vil begynne med å rapportere situasjonen til JSE8217s markedsreguleringsavdeling på surveillancejse. co. za eller ring dem på 27 11 520 7000. De skal kunne gi råd om hvordan du best kan spore pengene dine. hei I8217m ønsker å investere i Jose for første gang Jeg har ikke nok kunnskap I8217m ser frem til å investere R20000 og en annen ting I8217m en Zimbabwean, hva trenger jeg, et annet spørsmål er det er de aksjene differensiert i form av ordinære aksjer eller preferanseaksjer. Ved å bli med og investere i et børsnotert selskap, kjøper du aksjer i selskapet og venter på omsetning eller handler du personlig. Ryan Hoover sier Som investor, bestemmer du når du vil selge aksjene dine. This may be when you believe the price on offer is higher than the shares are intrinsically worth, when you spot a better investment opportunity elsewhere, or simply when you need the cash.