Monday, 13 June 2011

Dairy Farming Revolution in Kenya

Have you ever thought about dairy farming as a viable business venture in Kenya?

The daily industry in Kenya has recently seen a tremendous growth and a great potential exists for serious investors willing to make a decent living in this sector. My appeal is especially to the young Kenyans who continue to graduate from our schools, colleges and universities to seriously consider this option.

You can easily be a job creator and bet you could be laughing all the way to your bank.
Am reliably informed that Kenya is now the leading milk producer in sub-Saharan Africa and the sky is not just the limit but the floor for those who dare.

There are excellent super breeds that can easily deliver upwards of 40 litres per day. (Am told one of these can cost you like 150k). However, with 3 or 4 of these, and Brookside guaranteed price of Kenya shillings 30 per litre, then you can clearly see the potential. I can bet you don’t need anyone to offer you a job-do the maths.

Brookside dairy is even offering dairy farmers very enticing incentives with even up to 7 months price guarantees-your only headache would be milk production. Financiers are also keen on the industry so capital should not be a big deal.

Additionally and with the rising fuel costs, you can easily generate biogas for both lighting and heating with no recurrent monthly bills, not to mention availability of a proven nutrition booster for the households.

This is surely the white gold of Kenya. Let’s roll up our sleeves and go for it guys. You will thank me when you get there.

Agricultural opportunities in Kenya

Agriculture in Africa is so broad a topic and one very close to my heart. Having grown up in small scale farming community, and having seen both the economic potential in agriculture and its flipside, it is my considered opinion that the worst catastrophe facing farmers in Africa, especially the small scaled ones is more than anything else a mindset-we simply don’t look at agriculture from an economic point of view; but rather its just a way of life for most of us.
This attitude must first be dealt with and changed.
Compared to the rest of the world, most African countries experience very low agricultural yields. The effects of these low yields range from low economic development, poverty, high levels of infant mortality, low education & other social vices.
We all have heard or even know that Agriculture, which has always been tagged as the basis of Africa’s survival, is rather fast becoming the bedrock of poverty in the continent.
A major irony is the large presence of both local & International NGOs in most parts ofAfrica, who unfortunately seem to perpetuate the low yields/low returns policies in these communities-probably this justifies their existence too. Similarly, African Governments have not done much either. In fact most of their policies have always been in favor of the politically connected elites rather than the poor rural producers. This equation also needs to change so that governments can play their rightful role of creating the right environment and motivation for the small scale farmers.
So what is the way forward, and is there hope for those seeking to practice agriculture and make it commercially viable even on small scale in Africa? My bet is that Yes, there are enormous opportunities in this sector. Stay with me!  
First, the approach that lays too much emphasis on grass root production, thereby enforcing the presence of abject poverty in the continent is totally misplaced.
Today’s Agricultural practice must be within the realm of the application of modern methods. In fact, having many living below the poverty line increases the burden on respective African governments. Taxes received from farmers are too small and hence can not aid majority of government programs. In order to achieve a new prosperous Africa, the bar must be raised up and high.
A starting point towards making agriculture more profitable would be reducing the number of hands employed in farm labor drastically. A good point to note, countries such as Ethiopia, Nigeria and Burundi have 70%, 70% and 93.6% respectively of their total population involved in active farming struggling to meet up to the basic minimum living standards, unlike first world countries such as Canada, UK and South Africa with less than 20% of the total population involved in active farming.  There is thus a correlation between the percentage population of a nation actively involved in agriculture and the poverty level of that country. Hence Ethiopia, Nigeria and Burundi have roughly 70% of their population living below the poverty line as compared to The Netherlands which has 2% actively involved in agriculture and 10.5% of the population living below the poverty line.
I am talking about mechanizing Agriculture. It thus implies that for one to maintain a farm and live within the comfort zone, we must reduce the labor force of our farming units while ensuring production at the same (if not higher) level.
The bulk of the agricultural driving force in any nation is the middle class. In Africa today, the middle class is gradually being eroded and hence food production is gradually becoming short. The middle class can be resuscitated though through government sponsored programs targeted at reactivating the middle class.
Reducing the excess hands involved in farming would leave a vast number of hands unemployed. Obviously, it is assumed that as production increases on the farms, there will be a parallel increase in manufacturing, processing and service industries to absorb both the produce and the workforce displaced from these farms. This is where government and other organizations’ should get involved in. Hands relieved from the farms should be channeled into processing and services. Farm produce can be processed to its final form prior to export (Value addition). Such industries hire more labor hands than grass root farming outfits and also ensure workers meet up to the basic minimum wage.
We are currently in a fast paced, competitive and capitalistic world. Bigger nations are out to grab what they can get while at the same time ensuring that weaker nations continue to struggle in abject poverty in order to furnish the lavish lives of their populace. It is thus obvious that Africa must look from within and come out with her own strategy to improve her pathetic state. Relying on the western countries means condemning one’s future to everlasting poverty. An good example is the billions of dollars promised to Africa by the UK in 2008 was just to ensure that African farmers have seeds and fertilizers to sustain an uninterrupted supply of raw materials to their ex-colonial masters.
African leaders need to rise up and work for their lot with for heroic deeds. African governments must invest in highly mechanized agriculture as well as boost their processing industries and other industries in order to make the highest profit from their produce. This is the only way African nations rise from the pathogenic nature of poverty in Africa.
I will be sharing various opportunities in Agriculture for our continent. Keep reading my future posts.

Opportunities in Healthcare

The healthcare sector in Kenya & generally in Africa is showing signs of remarkable improvement as the quality of hospitals and the availability of qualified doctors has dramatically improved over the last

Demand for quality healthcare services across the African continent continues to grow by leaps and bounds over the past few years. By shifting attention from the traditional medicine to well structure modern healthcare systems, and investments in the latter, many African nations have now been able to largely meet the growing demand for better healthcare services for their citizens.

This demand has been greatly influenced by improving economies across Africa, a rising middle class population, remarkable improvements in hospitals and other healthcare delivery channels, availability of qualified well trained doctors and other medical practitioners among other positive trends.

Key players in the healthcare sector in Africa are mainly Governments, Religious Organisations and the private sector.

There exists a number of challenges which include the rising HIV Aids infection, TB and Malaria, Malnutrition & Hunger-which continue to place enormous strain on the public health systems, insufficient capital and infrastructural investments especially on research to fully support healthcare systems, illiteracy in some parts of the continent and over reliance on traditional forms of medicine.

As a direct result of these challenges, there exists huge potential for those looking for investment/ business opportunities in healthcare services provision in this continent.

I believe focus should be on quality, affordability and accessibility of these services to the general public.  Since most healthcare products in Africa are imported, there are also immense opportunities on the supply chain of hospital equipments, machinery e.g. x-ray equipments, mammograms, CT-scanners, instrumentation, prescription drugs and other medical allied products and services.

A 2007 report by the International Finance Corporation (IFC) estimated the market for healthcare will more than double by 2016, going up to $35 billion and the private sector is poised  to provide up to 60% of this to meet the demand. 
Private/Public partnerships may also offer a viable option into the future.
Other extremely viable business opportunities exist in:
·        Commercialization of the Infectious diseases innovation
·        Distribution and retail of medical supplies
·        Risk pooling as in Insurance
·        Adjusting products to meet unmet demand, particularly among the poor    Creating new models for mobile, remote and home based healthcare
·        Medical training & education
·        Using the rapid mobile telephony penetration to create new opportunities e.g. In Kenya one can now pay their monthly premiums using the famous M-PESA innovation. What of a subscription service with doctors/specialists on the same platform?? Food for thought!!!!!

Make Money on Energy in Kenya

If you are interested in making big money in Kenya and Africa, think Energy. With the appropriate investment this is my No 3 biggest bet that would not disappoint.

The energy requirements in Africa are largely unmet and better still, the demand is growing exponentially every year. What with the penetration in mobile telephony-the fastest growing being witnessed in Africa), Internet absorption, manufacturing, Infrastructure development and more organized farming activities? Clearly these will require huge amounts of energy to sustain-so you can now see why my bet is factual? Don’t shy away, read on, do some good research, invest your money on energy in Africa and you will be happy all the way to your bank; Interesting, isn’t it?

So what kind of energy does Africa need? I bet if you are with me this is easy-think renewable energy or the so called ‘green energy’.

For starters renewable energy flows from the natural sources like sun, wind, rain, tides, geothermal heat, plants and others.

According to the International Energy Agency (IEA), renewable energy is derived from natural processes that are replenished constantly.
Due to increased governments spending, climatic change concerns, high oil prices, rapid depletion of these oil wells and lessons from the developed countries are driving increasing renewable energy concerns and even legislation, thereby creating huge opportunities for big business opportunities in Africa

In 2008 for instance, about 19% of global final energy consumption came from renewable energy sources, with 13% coming from traditional biomass, mainly used for heating, and 3.2% from hydro electricity.
New renewable energy is growing very fast with a share of about 18% of the entire world’s electricity generation.

The good news is that while many renewable energy projects are large-scale, renewable technologies are also suited to rural and remote areas, where energy is often critical for development.
Kenya for example has the largest absorption of solar energy in the word with between 12,000-30,000 solar units installed in homes every year. Globally, an estimated 3 million households get power from small solar PV systems.  Community micro hydro systems can also be configured into village-scale or county-scale mini-grids to serve many homes and utilities. Biogas is another renewable energy source that serves more than 30 million rural households for both lighting and cooking.
Also growing at the rate of 30% annually, is wind power, with a worldwide installed capacity of 158 GW in 2009, and is widely used in Europe, Asia and USA. Where is Africa?  Brazil has one of the largest renewable energy programs in the world, involving production of ethanol fuel from sugar cane and it is estimated that ethanol now provides 18% of the country's automotive fuel. I am certain Africa can borrow a lot from countries like Brazil on energy.

Business Opportunities in Education for Kenya

Education in post colonial Africa remains largely far fetched in terms of accessibility, quality, equity and relevance. This scenario cuts across board right from basic through to higher levels of education. There have been deliberate efforts and initiatives though to address these issues, but to a big extent, they remain unfelt.

In majority African nations the major players in the provision of education services at all levels are Governments through public school systems, Religious organizations and private sector. These initiatives have been boosted variously by western partner states and international organizations like UNICEF, USAID, DFID, JICA, SIDA, DANIDA, EU among other major partners.

There are major strides among some states to provide free universal primary education to all its youth, and countries like Kenya today boast of a well trained and skilled human capital not only across Africa but also in the world. This makes Kenya the largest non-mineral economy in the African continent. It is also able to export its human resource to other countries around the world. Indeed, Countries like Rwanda, Botswana, South Africa and recently southern Sudan have and continue to benefit immensely from the expertise of Kenyan professionals working there.

However, there are still major challenges in the education delivery systems to most of the populations.

Besides the traditional school education which has its good share in the continent, forward thinking investors should focus on some of these growth opportunities on education in Africa:
·        Sports-establish sports academies for various sporting disciplines. This is a purely virgin area which has not got much attention in the past.  Going by the number of sports superstars from Africa being signed in various European clubs, it is evident that much can be done here and it won’t disappoint.

·        Performing Arts and Music Academy-It’s a pity that most aspiring artists from Africa have to travel to Britain and America to get training in these fields.

·        Girl Child Education-I can bet anything specifically targeted on the girl child is big business especially from the marginalized communities.

·        Languages-For heavens sake start a language school for Chinese, and you will thank me for it.

·        Reproductive Health-More people are becoming aware of their selves, and this is big

Overview of the Kenya's business environment

Kenya and generally the African continent remains vastly unexploited besides being a huge reservoir of all economic resources. This is partly due to previous disadvantages in wealth distribution in the world, trade in balance, cold war, and effects of colonialism, among others.

However this is really changing fast and the world’s attention is focusing more on Africa’s potential to drive the world economy moving into the future. Socio-economic developments, improvements in governance and democracy and penetration in education accessibility are some of the key factors driving this renewed vigor…, As they say the future is here!!

There are various economic & political blocs in Africa which offer a huge market and investment opportunity. These blocs include SADDC, ECOWAS, EAC, COMESA and IGADD. The major aim of these blocs is to widen and deepen the political, economic and social co-operation among partner states. This has resulted in establishing custom unions, common markets with the removal of all trade tariffs, and plans for a monetary union, with the ultimate aim of establishing a Political Federation of the African states.

The continued development of these blocs will increase the opportunities for Investors to trade in Africa and more importantly, will support the development of international trade and investment with other global regions.

So, what are these steaming hot opportunities? My big bet is on the following major sectors in Africa:
·        Education
·        Energy
·        Healthcare
·        ICT and
·        Agriculture

I will be sharing various opportunities in these broad sectors in my future blogs. Keep reading and make your wise investment decision(s).


Inspiration

Thomas Edison once said that ‘if we did the things we are capable of, we would astound ourselves’.

So what is it that keeps us most of the times if not always from being the best that we should be? Every sane human being at one point of his/her life will be confronted by this question-why cant my career, business, relationship, family, studies… be the envy of everyone? In an attempt to answer this question I have pondered and thought critically and come to my own conclusion that the only single reason we find ourselves in this situation is that we SETTLE.

We settle for what people often tell us, what society expects, what stereotypes say. In the end what we would have been never becomes. Of course this apparent settling could be driven by among other reasons fear and living within our comfort zones, habits, wrong company and associations, lack of goals among others.

So with all these bombardments what must we do to remain focused and probably get our lives in order? I must admit that the way I see it, no one needs to be extraordinary. Infact by doing small little things and doing them consistently and correctly is the only way out of this quagmire.

Think with me, as we explore and probably we could:
·        Cultivate self belief
·        Stretch our ambitions beyond what we can comfortably do
·        Start small, slow and now-do not procrastinate what can be done now.
·        Switch to a positive mood-you will be surprised at the energy from positivity. My Sales friend calls it positive mental attitude (PMA).
·        Tell and reaffirm to ourselves that we deserve the best
·        Get inspired from those who have been there-fortunately there are many who have been before us and travelled the route-just follow their map.

Lastly remember that there is much more to be done tomorrow and thereafter, anticipate it and don’t bother about yesterday since it is gone.

Hope this puts us all on a pedestal to take on opportunities that come our way, and realize them to help us live better lives.