The Promise of Telecom Infrastructure for Africa

A recent article by Richard Wray and Fahad Mayet of the Guardian analyzes the connection between Africa’s telecommunications infrastructure, in particular its growing mobile phone network, and the prospects for economic growth. According to the authors, in sub-Saharan Africa, “a mobile phone can be a passport out of poverty.” Telecommunications infrastructure reduces costs of interaction, expands market boundaries, and improves information flows.

Citing research by Professor Leonard Waverman of the London Business School and others, Wray and Mayet note that Africans use their cellular phones for various business needs: retailers call suppliers for price quotes, farmers check weather reports, traders call contacts to determine what is needed at the market. In addition, mobile phones help remote villagers access medical advice and help doctors in regional hospitals get advice from senior doctors in cities. The authors also observe that the cellular industry in Africa has spawned intermediary services, such as mobile phone recharging.

Royal Dutch Shell – Nigeria Joint Venture at Risk

A recently leaked internal memo from Royal Dutch Shell’s chairman of Nigerian operations, Basil Omiyi, and comments from Shell’s CEO, Jeroen van der Veer, raise serious concerns regarding the future of the Shell-Nigeria joint venture. The memo lambasts the Nigerian government for its failure to adequately finance and support the Shell Petroleum Development Company (SPDC), the Shell-Nigeria oil and gas exploration and production joint venture. The memo, circulated on November 14, 2007, was reported by the Financial Times on January 30, 2008. According to Financial Times, the memo accuses the Nigerian government of failing to finance its 55 percent majority share in the Shell Petroleum Development Company (SPDC) . On January 31, Reuters reported that Shell was taking a write-down of $716 million related to its Nigerian assets. In a statement covered by Reuters, Shell said the write-down largely related to onshore assets, including impairments and provisions arising from funding and the security situation in Nigeria.

Bill Gates Steps Up Effort to Promote African Development

In a January 24 front page Wall Street Journal interview, followed by a keynote speech at the World Economic Forum, Microsoft Chairman Bill Gates stepped up his campaign to focus the world attention’s on the needs of developing countries.

The Wall Street Journal interview was a precursor to Gates’s speech at the World Economic Forum in Davos, Switzerland. Advocating a movement for “creative capitalism”, Gates stated in the interview, “We have to find a way to make the aspects of capitalism that serve wealthier people serve poorer people as well.” In addition to emphasizing two important forces, self-interest and caring, Gates’s speech draws attention to a third force that he believes should be used to motivate efforts to improve the lives of the poor — the desire for recognition:

“I hope that the great thinkers here will dedicate some time to finding ways for businesses, governments, NGOs, and the media to create measures of what companies are doing to use their power and intelligence to serve a wider circle of people. This kind of information is an important element of creative capitalism. It can turn good works into recognition, and ensure that recognition brings market-based rewards to businesses that do the most work to serve the most people.“

The text of Gates’s speech is available on the Gates Foundation website. The Gates speech was also covered by the Boston Globe.