16/01/2016
Strive Masiyiwa
Series: The eagle in a storm (Part 1 - Intro).
The new year opened with turmoil in the Chinese stock markets as prices fell dramatically, leading to a global selloff. In just one week, global stock markets lost over $2 trillion US dollars! Other news in the global markets saw the price of a barrel of crude oil fall below $35 per barrel, down from a high of $62 per barrel less than 12 months ago. That’s down 50% in 12 months and 71% in 24 months!
Since the beginning of last year, 2015, the price of copper has fallen by 30%; iron ore is down by 42%; platinum has also been a disaster, losing more than half its value from less than three years ago. Agricultural commodities have not fared much better on global markets. Last week the South African rand hit an all-time low of 16:1 against the United States dollar and it’s still falling!
Your small business in Harare, Lagos or Nairobi may not have anything to do with China, or with any commodity like oil, iron ore, or platinum, so you might be asking yourself, “What’s that got to do with me?” Answer: EVERYTHING! It has everything to do with you, and its impact is going to be very personal... Brace yourself, there’s a storm on its way!
You might even be sitting at your desk as a civil servant, or supervising children at school as a teacher, or upholding the law as a policeman; or maybe you’re a pensioner, and you’re also saying to yourself, "I'm not in business; I don't know anything about these things, so what’s it got to do with me?” Answer: EVERYTHING! It has everything to do with you, and its impact is going to be very personal... Brace yourself, there’s a storm on its way!
You look at the sky and see rolling black clouds. The wind is picking up and you say to yourself, “A big storm is on the way.” Even though rain isn’t yet falling, you know the signs of a heavy rain storm and that you must button things down and secure yourself properly. Or maybe you’re one of millions on the continent today suffering another rainless sky, for months on end, putting your fields, crops, livestock, perhaps your whole life at risk...
These are "signs" in weather conditions. Those who are experienced in such things can usually say with a degree of certainty that a storm is coming. However, if you do not understand these matters, or you blissfully decide to ignore them, you’ll suffer a serious drenching or worse.
In business economics we also have signs, and we're seeing these warning signs right now. They're not any different from the black clouds and the wind, or the clear sky and the drought. They're all linked. The stock markets of China and New York may seem far away, and global commodity prices and exchange rates may seem irrelevant to your village, but they’re linked to the real economy in which you live and work!
The next 12 months or more will be very tough, particularly in emerging markets. Many African countries will find it hard going. Consequently, it will be tough for citizens, especially those who are most vulnerable. The weaker your country's economy going into the storm, the tougher it will be. Similarly, the weaker your company or employer, the tougher it will be...
__There is a storm coming.
Now let me tell you about the flight of the eagle. Prophets and Kings of the bible world absolutely loved watching this majestic bird. They believed the eagle is the only bird that flies during a storm. It's developed a flying technique (a skill) they call "mounting" the wind (as though it were climbing a stairway). The eagle has so mastered the storm that it not only flies during storms, but can find opportunities to prosper; it can actually use the storm to its advantage.
Even in these storms, those with the correct mindset will prepare themselves. They will train themselves to understand the times, and learn to prosper in its headwinds… they will mount on wings as eagles!
Yes, it’s going to be very tough, and for some of you, tougher than anything you could have imagined, but you must not be discouraged or wearied. And when you come through it, you will be much better at what you do. Just don't be afraid, and don't panic. In this series I will remind you of some of the things you must do to prosper like the eagle.
This year we must be serious, very serious. Africa expects it of us.
To be continued. . .
Timeline Photos · Thursday at 10:24am ·
View Full Size · More Options
Like
Comment
Share
70,957 people like this.
Write a comment...
Post
Strive Masiyiwa
Afterthought 2.
Even youths grow tired and weary,
and young men stumble and fall;
but those who hope in the Lord
will renew their strength.
They will soar on wings like eagles;
they will run and not grow weary,
they will walk and not be faint. (Isaiah 40:30-41).
Like2,820Reply · More · Thursday at 10:26am
Louisa Antia-obong
Our God is the same yesterday, today and forever. HE is from… More
See all 123 replies
Strive Masiyiwa
Afterthought 1. The eagle does not fear the storm, neither does it pretend it’s not there. It seeks to thrive despite the storm. Faith does not deny the facts on the ground, it overcomes the facts on the ground.
Like2,196Reply · More · Thursday at 10:26am
Rutendo Kasirori
Thank u Strive. My faith ws based on denying facts. And most of… More
See all 85 replies
Strive Masiyiwa
Let's connect some of the dots on Africa-China nexus (although not only issue):
# China is a huge importer of raw materials from Africa. It buys everything from copper, to iron ore, platinum, oil etc., It turns these into products, many of which it exports to other countries including the US.
Many African countries also receive loans for infrastructure from China.
The slow down in China's economy is affecting African countries as they are buying less and less of our minerals. This means the price of the minerals is also falling.
China's solutions will result in further pain for Africa.
# South Africa: is a a big exporter of raw materials...to countries like China. A slow down in China, affects SA (not the only problem in SA---economically speaking). But anyway a slow down in exports as well as lower mineral prices, weakens the Rand.
South Africa is also a big employer of people of neighboring countries like Zimbabwe, Malawi...who also send money home as remittances to help their families...
A slow down in SA and the weakening Rand, means less money sent home, few jobs for migrants. Those countries, also affected by China slow down directly because they also export minerals to China.
# Zimbabwe: affected by weakening Rand, as remittances also slow down and diminish. Also becoz it uses $, dramatically weakens its competitiveness, leading to factory closures...more problems than that of course---economically speaking.
# Nigeria, too dependent on oil. Price down means tight liquidity, economic slowdown, job losses. Inherent weaknesses in economic structure (similar to other African countries) to be severely tested.
# now you analyze your own country.
I will talk about solutions in future posts... Yet there are countries which will almost escape unscathed and even prosper because of a deliberate design over the years of their Creation Model___Ah? (Perhaps now I have your attention; we shall talk).
