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27 - 08 - 2019

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Egypt could soon impose taxes on digital platforms and internet adverts. The country’s Ministry of Finance is finalizing a draft income tax law that will introduce taxes on social media adverts, internet search adverts and ecommerce platforms. The law was first suggested in May 2018 by some members of the Egyptian parliament, and it has been in the works since January this year. Local reports say Facebook is working with the government to develop “the best practical solutions” for all parties concerned. The move to tax these internet activities comes less than a year after the Egyptian government passed a law allowing it to monitor social media users with over 5,000 followers. The push to introduce the new internet tax is another attempt to regulate digital businesses and social media usage in the country.However, Egypt is not the first or only country pursuing an internet tax agenda. Last year, Uganda introduced social media taxes. In August 2018, Zambia announced a $0.03 daily charge to use internet telephone calls using services like Whatsapp and Skype. Nigeria also plans to introduce a 5% VAT on all online transactions beginning in January 2020. But it’s not just African governments that are introducing such taxes; European countries are also doing the same. In July 2019, France passed a 3% tax that applies to digital businesses that have revenues exceeding $830 million. The UK has also introduced a 2% tax on digital businesses including search engines, social media platforms and online marketplaces. The law will go into effect by April 2020. Why have they all decided to tax the internet? The above cases show a notable change in how the world sees digital businesses; a sort of dialectic that is altering the same open environment that allowed digital companies like Facebook to expand and become dominant globally. Governments are beginning to question what rules, if any, govern how to tax digital services and are each imposing laws in the absence of a global consensus. Meanwhile, the Organisation for Economic Co-operation and Development (OECD) has declared that a long-term solution is now urgent and significant (PDF link) and wants members to work together to provide one. In the meantime, states are going ahead with their unilateral approaches, as the UK example has shown. In my article about the African Continental Free Trade Agreement (AfCFTA), I briefly noted that the trade agreement may need to define proper rules of origins to accommodate this changing digital tax environment.
GIG Logistics, the logistics arm of God Is Good Group (GIG), a Nigerian mobility company, has officially launched in Ghana. The company made the announcement on Monday. According to TechPoint, GIG Logistics has opened two facilities to support its delivery infrastructure in the West African country. The company is also planning to introduce an Uber-like app that would allow it to provide “logistics on-demand”. Using the app, people will be able to make fast deliveries using independent bike riders and drivers who sign-up to the platform. This is something to monitor, particularly because GIG is a legacy mobility company that is adapting more technology features to bolster its offerings.

The Ugandan government is working with Huawei to install facial recognition cameras in cities across the country. The Ugandan police claim the cameras are strictly for security reasons, allowing it to identify people in public spaces. The government said the technology is already "transforming how policing" works in the country. Meanwhile globally, the use of facial recognition software has led to ethical debates in different countries including the US, with companies like Microsoft wary of what institutions they render the service to. In Uganda, there are concerns following the plan to introduce the technology. These concerns are predicated on the fact that the state is a quasi-dictatorship and recent news that the government has been spying on opposition politicians. Although the government has denied the latter claim, opposition politicians believe the introduction of the camera technology is meant to “track us, hunt us and persecute us.”

On 27th of September, 2019 TechCabal is holding TC Townhall: Mobility, a gathering of the most knowledgeable and influential entrepreneurs, investors and policymakers in the mobility industry. Speakers and participants will explore activities, trends and challenges in Africa’s mobility sector and what the future holds. Newly confirmed speakers include Taiwo Ketiku, VP Investments at EchoVC; Chinedu Azodoh, Co-founder at MAX; Oluwatoyin Oshinowo, Co-founder/VP Product at FieldInsight; Kola Tubosun, Linguist for African Languages at Google and Emeka Ajene, MD/Co-founder at Goziem. Tickets are now available for purchase and a 10% early bird discount is available for readers who buy their tickets before September 1st with the code TCMobility. Further discounts apply for companies/individuals buying at least 5 tickets. If you require the discount code for that, please fill this form
inDriver, a Russian ride-hailing startup, has launched in Nigeria, according to TechMoran. inDriver, unlike other services, allows passengers to haggle the price of a trip. Using the app, passengers tell drivers how much they are willing to pay for a ride and the first driver to accept that amount gets the order. The service already operates in African countries like Kenya, Uganda and Tanzania. Globally, inDriver is available in 26 countries and claims to have over 29 million users. In the Nigerian market, it will have to compete with existing services such as Bolt and Uber.
9Mobile, a Nigerian telecom company, has secured a $230 million loan from the African Finance Corporation a pan-African development finance institution. The loan will help the company shore up its services in Nigeria's highly competitive telecom sector. Formerly known as Etisalat, 9Mobile has been in a fragile state since 2017 when it defaulted on a $1.2 billion loan provided by a group of Nigerian banks. In 2018, the telco was sold to a consortium of investors known as Teleology Nigeria Limited after a bidding process. But despite the sale, the telecom company's recovery has been slow. It currently has 15.965 million subscribers, a low figure when compared with the subscriber numbers from the three other major telecom companies. The new funding, albeit another debt, could help give 9Mobile a bit of fighting chance once again.
The #PitchdriveAsia Tour organised by CcHUB in partnership with GoogleforStartups is still ongoing. Ten African deep technology and hardware startups are currently in Singapore and will continue through four other Asian cities known for their deep tech and hardware ecosystems. Learn more here and sign up to follow the tour. You can also keep up with the tour on Twitter by following CcHUB or by using the #StoriesfromPitchDrive and #PitchDriveII hashtags
Nigerian agritech startup EZFarming has secured a $150,000 funding from 500 Startups, a US-based accelerator programme. EZFarming is an agricultural investment platform. It allows people to earn returns by investing in the productivity of small farm owners. The startup secured the funding round after it completed the four-month-long 500 Startups programme. In return for the funding, EZFarming will cede 6% equity to the tech hub.
Electricity generation has long been a concern for the African continent. In 2015, the 48 countries in Sub-Saharan Africa generated around 80,000 megawatts of electricity with South Africa alone accounting for more than half of this. To put in perspective, Iran generated over 70,000 megawatts of electricity in 2018. However, over the last few years, there have been notable efforts to address Africa's power challenges. With attention increasingly going to renewable energy sources, African countries are getting more funding and support for their electricity industries. In this article, I detailed how governments, development finance institutions and startups are playing different roles to address electricity challenges on the continent.

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We'll see you tomorrow.   - Abubakar
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