General

THE LOGISTICS & TRANSPORTATION SECTOR is absolutely crucial in this fight against COVID-19. The role it plays in the supply and delivery of resources makes it necessary that we mitigate the impact of the novel coronavirus in this sector so as to enable us mobilise effectively during this war. Transportation of products is simply the movement of said products from one point to another. The logistics of this is not that simple. Logistics management involves knowing the right products, and how much and how many is required, and what’s the correct time to get it at the right location, and getting it there in the right condition after all that. This would make transportation a subset of logistics.  Logistics is transportation plus everything else in between, including storage, packaging or repackaging, etc. The key to optimising our logistics and transportation is to find a good balance between efficiency and cost. But these times of need, when we cannot complain about the water bill when our house is on fire, the deployment of efficient logistics protocols is ever necessary to get what is needed by those that need it the most to where it’s needed on time and in the right condition, no matter the cost. Whilst logistics and transport companies have over the years enhanced their systems by investing into technology and other structures in order to harness more business opportunities, the COVID-19 pandemic seem to have temporarily dashed that hope, at least for the time being. When COVID-19 first hit the industry, the initial widespread response was to safeguard employees by following the guidelines set by the World Health Organization (WHO) and the governments of the countries they operate in, such as providing hand sanitizers and working from home. These measures were implemented with the main goal of securing essential goods for the millions of people across the globe. Logistics companies have made continuous movement between states and cities possible through the networking of ports, suppliers, and manufacturers, in addition to intra-country and last mile deliveries.  Keeping goods and services in motion has gone from being an unceremonious motto to a definite agenda. When Presidents and Prime Ministers comes on to deliver their speeches on how they’re going to send aid here and there, and how they’re going to order this and that for him and her, the task falls on logistics firms to facilitate such orders in a manner that befits the urgency of the situation. When Wuhan was the centre of the COVID discussion back in early February, UPS offered free air freight services to China for millions of face masks and huge quantities of other PPE’s. The toll on our frontline workers is also ongoing. The impact of the work of our brave frontline workers is watered down when we don’t have effective logistics and transportation systems in place to get them what they need on time. According to Satyanarayana Chava, Founder & CEO of Laurus Labs, a leading pharmaceutical company in India, “Logistics are taking longer and freight rates have gone up… this is also leading to shortage of manpower”. A shortage of manpower in Ghanaian places of business was very evident during our recently ended partial lockdown. As with many other sectors across the world, the logistics and transportation sector has taken a peculiar hit such that there has been a simultaneous lack of both supply and demand, in varying degrees. On one hand, the billions of people on lockdown at home or observing social distancing protocols at work ends up creating a lack of the needed levels of logistics services supply to match an increased reliance on delivery services for all the many incoming purchase orders. Then on the other hand, many factories across the globe that utilise logistics and transportation services have shut down, resulting in a lack of demand for logistics and transportation services. Current frustrations of many world leaders with the ordering of test kits and other PPE’s are partially a result of the current difficulties within the logistics and transportation sector. If money is not the problem, then when goods are ordered, then they must be delivered. Yet, as we read early on in this article, logistics is a lot more than just transport. COVID has hit this industry hard and the effects are rippling across the other sectors of industry. Air freight has been a vital part of time-sensitive supply chain and logistics management systems across long distances. With COVID-19 practically bringing the airline industry to its knees, especially for the delivery of vital medical equipment, pharmaceutical supplies and food, airlines have had to resort to using their grounded passenger jets as cargo planes. Luckily enough the lockdowns don’t seem to have had a huge impact on cargo handling as essential goods and services are still open. Availability is relatively stable but demand however seeing an edge. This does have some effect on pricing which is seeing some increases. Certain charges and other economic restrictions have been waived to make room for this. Also, the increase in demand for air freight does mean cargo planes are filled faster. Maritime cargo appears to be harder hit by the pandemic than air cargo. Restrictions in border movements have seen cargo ships locked in other countries in regions such as Europe and Asia. The prices for maritime cargo is also largely stable. Availability tends to be challenging especially with regards to equipment shipment. This definitely has an impact on the logistics and effective planning of some companies that work with heavy machinery. For the vessel chartering market, there appears to be little to no impact. Prices continue to remain stable whilst availability continues as usual. The impact of social distancing rather implies crew management has become a challenge and the possibility of infections and early isolation and quarantine of some crew members have been reported to pose some challenges. Distribution by road freight has very obviously also been affected by the coronavirus pandemic. With lockdowns being in effect across the world in varying degrees, it’s creating a

To say this pandemic poses a threat of serious losses to the Petroleum Industry worldwide might not adequately capture the sheer numeric magnitude of the shortfall for this particular industry. We are talking about an industry where small change is spoken about in the billions so you’d have to imagine what happens when the price per barrel of crude oil keeps plummeting past 20%. And that’s about all I can speculate with this because the signs are daunting in this respect and I had to put in some 2 cents on this column… this time through Peter Yamborigya, Director of Acquisitions & Partnerships at Maxwell Investments Group. He is also the Country Manager for the Africa Centre for Energy Research & Economic Intelligence (ACEREI) and an Adjunct Lecturer at the British College for Technology and Commerce (BCTC).  SHELL has declared force majeure on its exportation of crude oil from Nigeria’s Forcados terminal. After weeks of writing on the novel coronavirus and how it relates to Force Majeure and Commercial Impracticability, Peter and I started talking, as we have during this lockdown period. Conversations with Peter during this lockdown period have centred around petroleum and power projects, energy policy implementations, development economics and its applications. Enjoy the read! ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ The Coronavirus also known as COVID-19 has brought about untold difficulties to individuals, governments and private organizations across the globe. In the wake of this pandemic, there has been stricter travel restrictions affecting many businesses and operations. The global oil and gas industry is among the hardest hit amidst the growing uneasiness the world currently finds itself. On the top of all this is the impact on the prices of crude oil which has seen a historic downward trajectory never before experienced. Price volatility has always been a challenging element of the oil and gas market but has rarely been more extreme than it is today. COVID19-led disruptions to demand, combined with its dramatic impact on financial markets worldwide, have led to rampant price swings. Social distancing, combined with partial to full lockdowns, have also impacted the lives of workers requiring some dramatic adjustments. Safe work systems also have changed quickly in response to the pandemic, requiring companies to find new ways to safeguard their staff and families.  Many participants in the oil and gas industry have seen sales and revenue projections crash, this time due to the upset of demand associated with COVID-19 and the ever-geopolitical war in prices between Russia and Saudi Arabia. As to what path lies ahead for the industry in the coming months and years, it would be up to the individual organizations’ resilience and government support systems within their respective jurisdictions.  In this article, a cursory look is dipped deeper into the various sections within the industry to understand what is happening currently and a thought on how they could get out of it. As Maxwell Ampong is very fond of saying, these are all facts and this is an opinion piece. OPERATIONAL DISRUPTION AND SUPPLY CHAIN RISK The crux of the oil and gas industry is largely the effectiveness of its supply chain network which connects the dots from production to the final consumer. As much as oil and gas activities are generally considered essential activities by governments and have been mostly exempt from the lockdown measures, it is not completely isolated from the consequences of these restrictions. Continued operations will likely become increasingly difficult due to workforce shortages as employees are infected by the coronavirus and the practical difficulties in many cases of social distancing and movement restrictions.  Companies therefore are preparing to or already are operating with skeleton crews to continue operations. This is currently offsetting and disrupting planned maintenance, inspection, repair and replacement of equipment and drilling activities. For this period, companies would also have to look at third-party contractors who work on-site and structure an alignment of operational activities with COVID-19 policies. One has to even stomach the prospect of sealing off oil wells as a result of the reduced number of personnel on drilling rigs falling below the level required by health and safety regulations and the reasonable and prudent operator standards. Speaking of supply chain disruptions, thought beyond the initial supplier in the supply chain will be required to identify who in the chain has which level of the supply chain risks at play here, as disruption among second-tier and third-tier suppliers could ultimately affect both service companies and operators.  UNEMPLOYMENT DUE TO ACTIVATION OF FORCE MAJEURE CLAUSES The Covid-19 currently shows no end in sight, but there is definitely an end to all this. Still, as the situation deteriorates, many industry participants are reaching for the force majeure (FM) provisions in their key contracts to excuse failure to perform or to exit. Whilst these are typically designed to cover a situation where contractual performance is impossible, difficult or onerous to perform as a result of exceptional events outside either party’s control (for example a global pandemic), relying on an FM clause is very heavily dependent on the factual circumstances and the drafting of the specific clause. The choice of the contract’s governing law will also influence the availability of FM and similar reliefs including possible change of law relief. Depending on the situation, there are also likely to be several steps that a party seeking to claim FM should take in order to maximize its chances of success, for example: identify the specific measures (as opposed to coronavirus in general) and evidence the actual impact these measures have had on it; mitigate the impact of such measures; and submit the contractually required notices on time. The end game however is that some workers are going to made redundant or dismissed for no activity. This could ultimately balloon the unemployment basket. As instability and uncertainty increase, so will the number and types of disputes due to businesses becoming unable (or unwilling) to perform existing contractual obligations.  COUNTERPARTY CREDIT MEASURE OUTLOOK As the pandemic season continues, the industry must brace itself for a renewed

Coronavirus cannot be Defeated for any of us until it is Defeated for all. The coronavirus has over time proven to not only be a health pandemic, but also a potentially devasting economic catastrophe to billions worldwide. It is the society’s weakest and poorest that are likely to be worst hit. It’s not far-fetched to say that no economy is exempt from the negative impact of another. It’s a global village after all, as advertised. Thus, current times make it stupendously ill-advised to leave Africa’s economy out of conversations on reducing the fiscal impact of COVID-19 now and after we beat it, specifically the threat to the poor and needy. It is no longer a secret that should this coronavirus continue to spread into the coming months, for the poorest of us, the plunge from prosperity to peril will be as swift as the switch to lockdown protocols. The 2020 economic growth rate for the world and that of individual countries have already declined to very low values, implying no improvement in standards and cost of living for those that are already at the bottom of the barrel. That is focus of what you’re about to read, a spotlight on those at the bottom of the barrel and how this pandemic will likely mean much worse for them. Rya Kuewor is the Co-Founder and Executive Director of the Refugee Integration Organization (RIO) and an Agenda Contributor with the World Economic Forum. Simon Turner is a Consultant with the African Health Innovation Center and a Director at Founder Institute. Both are Migrant Reintegration Consultants with SOCIAL IMPACT, an organization that has been instrumental in designing and implementing innovative qualifications and start-up support for socially disadvantaged groups. These are all facts, and this is an opinion piece. Enjoy the read! ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ By Rya Kuewor and Simon Turner While it is fair to say that to some extent COVID-19 doesn’t discriminate, it’s also a given that once it starts to hit the world’s poorest, marginalised and most vulnerable, inequality will yet again prove to be a devastating curse. With little or no access to clean water, shelter, information, healthcare, food, or even the luxury of “social distancing”, the world’s poorest and most vulnerable are at increased risk of suffering the worst from COVID-19. Adding up the 25.9 million refugees living in camps, and the 41.3 million Internally Displaced People (IDPs), as well as the 900 million people who live in the Least Developed Countries (LDCs) – most of which are African nations – over a billion people are at risk and almost 50 countries face the risk of catastrophic failures. The Problem While recognising the importance of learning from other countries like China, Italy, Germany, and South Korea, African leadership and its citizens should not think Africa, as sovereign nations and as a continent, will experience similar timeframes with regards to the time it will take to get a handle on the extent of COVID-19 pandemic. As of today (10 Apr, 2020), there are just over 13,000 recorded cases in the whole of Africa, but celebrating these relatively low numbers as a win would be a mistake, because they are at least partly a result of insufficient testing.  We are also potentially being lulled into a false sense of security by taking as gospel the possibility that the disease is less infective in warmer temperatures. Even if it were the case, “this will be a source of concern for Southern Africa, which is heading into its colder months and “flu season,” and so their healthcare systems – already creaking – will quickly be overwhelmed. The outlook for the rest of the continent is equally bleak, with most countries unprepared to cope with the pandemic for a prolonged time. This coping ability is contingent on how soon robust measures to combat the viral spread are enforced and/or a vaccine or other solution is developed (which is unlikely until before 2021), but most African nations currently cannot effectively implement these measures.    The Impact The public health, economic and social devastation the world has seen in the wake of the COVID-19 pandemic will be many times more severe in developing countries if the viral spread is not contained. In normal times, low-income countries are familiar with poor infrastructure, social amenities and healthcare (not to mention conflict) – with Africa alone carrying a quarter of the world’s disease burden but is responsible for only 1% of global health expenditure – meaning that adding on the ravages of COVID-19 further worsens the situation of many African nations. Africa quite simply is unlikely to be able to follow most of the world in locking down countries and regions to help contain the spread of the Coronavirus. While the US, European, Australasian and Asian countries are able to enforce quarantines, they can also cushion the impacts of the quarantines on their citizens. From direct financial aid to households, to corporate bailouts of up to 2 trillion dollars (in the US), these nations and regions are far better prepared to deal with the pandemic and its immediate aftermath. About 85% of Africans live on less than $5.50 dollars a day, many earning daily wages in low-skilled work. Enforced quarantines and stay-at-home orders will abruptly upend the livelihoods of these people, many of whom do not have the reserve resources to shelter in place. For the people who live hand-to-mouth and in extreme poverty in Africa, many living in shacks and slums with little chance of social distancing, insufficient potable water or sanitation, their communities could easily become a nexus for the viral spread. Because more than a quarter of the world’s hungry live in Africa, the imminent dilemma of either starving or maybe catching COVID-19 will become a bleak reality for many poor families, some of whom may be forced to risk infection.  For some of these vulnerable communities, particularly in refugee camps and for many IDPs, the threat of pandemic is but another of many life-threatening situations they have had to navigate for years. In addition, following how Ebola caused grave stigma against survivors, COVID-19 may engender how survivors or infected persons are treated. Facing the potential for vigilante violence, some already marginalised infected people may decide