Africa, South Africa, Manufacturing, Health, COVID-19

South African company ready to roll out low-cost ventilators for the African market



EPCM is an engineering, procurement and construction company specialising in oil and gas projects in Africa and beyond.

EPCM’s co-founder and CEO, Tom Cowan, came up with the idea for the ventilator following a visit to his sister, a medical doctor, just before South Africa went into lockdown. She voiced her concern regarding the shortage of ventilators, both in South Africa and the rest of the continent.

“At that stage I wasn’t even 100% sure what a ventilator does. We talked about it and she explained it to me, and it sounded like something very similar to a gas system that we usually design,” he says.

After some internet research, Cowan came to the conclusion that designing a ventilator wasn’t “too complex”.

“About two hours after that, the first concept of a ventilator was born, and maybe two hours after that we started with some more detailed design … And it took about two, three days for us to completely understand what we wanted to build and do a few prototypes.”

The company deliberately kept the design very basic to reduce costs and ensure that it can be made from materials and machines currently available in most African countries. “The whole ventilator can be cut from a perspex plate … and then you basically have to add the electronic component to that and then it will work,” he says.

“We’ve specifically designed it to be easy to manufacture … Our design can be made from perspex, it can be made from stainless steel. If you have nothing else, you can even make it from wood.”

“The whole idea behind this was to get it rapidly manufactured. We’ve partnered with a laser cutting company in South Africa which is able to cut many of the sheets in a day, and we can just assemble,” Cowan adds.

A ventilator is a machine that provides mechanical ventilation by moving breathable air into and out of the lungs, to deliver breaths to a patient who is physically unable to breathe, or breathing insufficiently. Modern ventilators are computerised microprocessor-controlled machines.

Cowan says the Covid-19 outbreak has prompted many people to design simple mechanical ventilators, but these often lack the ability to precisely control the flow of gas. “Our system is designed so that you can physically set the breaths per minute, volume per breath, maximum pressure and flow for the machine,” he explains

Whereas modern ventilators used in top hospitals cost anything from $20,000 and upwards, EPCM’s model will go for less than $2,000.

The company will this week start with the production of 50 units for delivery to Zimbabwe, Mozambique and Ghana. Cowan says these countries have less stringent regulations around the approval of medical devices than South Africa, where EPCM is yet to receive the go-ahead for its ventilator.

“If you want to get a ventilator approved in South Africa, you need European Union approval … The regulations and the hurdles that you have to jump over to get these ventilators certified is actually the biggest concern and probably the reason why there is not a lot of innovation or new companies starting to focus on the ventilator industry.”

According to Cowan, the South African authorities are however relaxing some of their regulations in response to the Coronavirus crisis. “They have to. It is either, relax some of the regulations or have a lot of people die.”

Commenting on the effects of Covid-19 on EPCM’s core business, Cowan said while most of the company’s construction projects are currently standing still, its consulting, engineering and procurement work continues.

The company is, however, seeing an impact from the dramatic weakening of the South African rand against major currencies. The currency has weakened from R14.76/$1 on 5 February to R19.05/$1 today. “Once you have a crisis, emerging [market] currencies are all going down. I think it is important that you have US dollar-based income, which we do have. But we also have procurement with fixed-price contracts in the European, Asian and American markets, which definitely provides challenges when you have our currency fluctuating like it is now,” he explains.


Further reading

[March 2020] Kenya-based investor sees opportunity in Covid-19 crisis
[March 2020] Africa: crisis a once in a decade opportunity
[March 2020] Coronavirus will hit African economies hard

Source: South African company ready to roll out low-cost ventilators for the African market

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Africa: crisis a once in a decade opportunity

By Rob Eloff, managing partner, Lateral Capital

As one of our portfolio CEOs in Kenya said this week: “It would be a shame to let a crisis go to waste.”

Valuable companies will emerge from Africa irrespective of the Covid-19 pandemic because innovation happens in a backdrop of scarcity in normal times. It will pay to continue to focus on frontier markets while the world is melting down because this innovation is likely to continue at more attractive valuations, with the potential to deliver greater impact than elsewhere.

Funding will slow down, in Asia venture funding slowed ~30% for two consecutive years after the ’02 SARS epidemic and in Latin America funding was down 50% following the 2015 Zika virus outbreak. In the years that followed these crises, the world got to know Alibaba, JD.Com and Nubank.

In Africa technology emerges as a response to everyday challenges

Well known examples include Kenya’s M-Pesa, Africa’s decentralised renewable energy revolution and the prevalence of remote learning in Nigeria.

In his upcoming book “Out Innovate: How Global Entrepreneurs from Delhi to Detroit are Rewriting the Rules of Silicon Valley“, author and friend of Lateral, Alex Lazarow reminds us how companies operate and scale in markets without economic stability or a supportive startup ecosystem.

“Start-ups operating amid conditions of relative scarcity, where capital and talent are hard to come by and economic shocks are more likely to occur, face unique pressures. Yet many have become superstars in their own right. Their formula involves a more balanced approach to growth, a focus on solutions to real problems, and investment in their workforce for the long term. These ‘frontier innovators’ hold important lessons for companies of all sizes and in all locations – including Silicon Valley itself.”

Africa breeds anti-fragility

In the African context, key tenets of survival include:


Products and services that solve essential problems vs cyclical trends
  • Measuring profitability from the outset rather than a singular focus on growth
  • Enabling legacy infrastructure to work better, rather than simply focusing on disruption
  •  
  • At this strange moment in history, we look to the technology community in Africa for leadership through innovation.
  •  
  • This week we learned of the Nairobi and Lagos technology community responses to Covid-19.
  • Portfolio company Koko Networks has re-calibrated its supply chain which spans across India and Kenya to convert ethanol for cooking fuel to sanitation products as part of a large scale collaboration to avert a humanitarian crisis in Kenya’s urban centres. 4G Capital is also part of the response via its working capital products to essential services for SMEs during the lockdown. Meanwhile portfolio company Lynk, which matches informal workers to demand for their products and services is working to match its B2B team with services delivery challenges. As we know, unless you solve for the poorest of the poor, transmission is a given.
  •  
  • Lagos based Medsaf has been a leading provider of first response supplies to pharmacies and hospitals.
  • Aside from our existing portfolio companies, a founder that we are following closely in Nigeria has a clear response to Covid19. Lifebank founder and CEO Temi Giwa-Tubosun has launched a national Quip register for critical healthcare infrastructure to fight Covid-19 across 200 Nigerian hospitals. Lifebank is then connecting suppliers and technicians to get functioning hardware to where it is needed most.
  •  
  • In Ghana, digital diagnostics company Redbird has launched its Covid-19 self check and resources app which will also cover Kenya, Nigeria, South Africa and the US.
  • In South Africa, Epione.net is leading the charge with its primary care logistics platform response.
  •  
  • A Kauffman report titled ‘Is This The Black Swan Moment To Solve Big Problems?’ reminds us that:
  • 95% of the jobs created in the US over the past 20 years were from companies less than five years of age. Arguably this skew will be even more notable in frontier markets when we look back at 2020.
  • VC fund vintages during adverse economic periods tend to outperform. We have written extensively about why a different model to traditional VC makes sense for Africa, but the valuation discount that we are already seeing this quarter cannot be ignored. What happened in more mature emerging markets historically that led to a crisis being a catalyst?
  •  
  • SARS forced Alibaba and JD.Com online
  •  
  • The ’02 epidemic directly contributed to the birth and scale up of Chinese e-commerce. How?
  •  
  • In a look back to how SARS contributed to the birth of e-commerce in China, this post reminds us that:
  •  
  • “In 2003 e-commerce was just starting to emerge in China. After all, not many people had access to the internet. Alibaba was primarily a B2B platform, connecting US buyers with Chinese suppliers. JD.com was a chain of small electronics shops that launched an online e-commerce site…
  •  
  • “Alibaba was a four-year-old company that focused on B2B e-commerce, matching American procurement teams with Chinese suppliers. An Alibaba employee caught SARS when she was sent to attend the Canton Fair in May 2003. Alibaba’s 500+ employees were quarantined at home for twelve days and required to work from home.
  •  
  • “Many countries around the world issued travel warnings for businessmen travelling to China, and thus many turned to Alibaba’s online business to source Chinese goods. Starting in March 2003, Alibaba’s B2B e-commerce business added 4,000 new members and 9,000 listings each day, a 3-5x increase over the pre-SARS rate.”

Similarities and differences to Africa

Africa’s company formation, technology deployment and funding are on track with 2013-2014 South East Asia as outlined in our end of year report. The key differences between the regions remain large scale adoption of e-commerce due to disposable income and last-mile infrastructure constraints, and fragmented regulatory environments. The rails to solve for some of these gaps have started to emerge with technology facilitating cross border payments, regional and continent-wide economic integration and savvy founders now focusing on last-mile logistics.

SARS drove Chinese suppliers and consumers online. That is not going to happen the same way in Africa as we have seen with Jumia‘s struggle to scale. Mobile app-based commerce for specific needs is however starting to scale as we have seen with Lynk’s products and services on its Uber-like trust platform. It is difficult to pinpoint exactly which aspects of this crisis will bring down costs and behavioural barriers to a migration to online scale in Africa, but here are a few speculative guesses:

De-monetisation could accelerate as countries outside of the East African Community, Ghana and Côte d’Ivoire realise that mobile money is not a luxury. Blockchain applications could finally take off with the to decreased friction they provide for consumer wallets when the value of local currency savings fall off a cliff in times of crisis.

Multiplier effects from co-operation between ventures that can plug and play via APIs to leverage each other’s platforms.

Renewable energy that is interoperable between central and microgrids. In Nigeria remote work is impossible when the average Lagosian can rely on only 45 minutes of a 60W lightbulb daily from the central grid.

Once in a decade opportunity

Critical infrastructure needs are similar across Africa’s cities. A forced migration online (Zoom, e-everything) likely brings boundaries, barriers and costs lower and leads to a hustle and innovation gear shift that is already incredibly exciting.

In sub-Saharan Africa there is already an element of “business as usual” for innovators with stretched resources and daily challenges. There will be pain, funding will become scarcer and macro-economic developments command a repricing of all assets, but for the engaged investor that is willing to roll up their sleeves and be part of the solutions demanded by the world’s fastest growing and youngest continent the opportunity to generate once in a decade returns and impact comes with high correlation and alignment.

Source: Africa: crisis a once in a decade opportunity

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shutterstock

The novel coronavirus disease (COVID-19) outbreak, recently declared a pandemic by the World Health Organisation, has taken the world by surprise. The good news is that tremendous scientific and technological advances have permitted scientists to understand a lot about this virus in a short amount of time.

Within just two months of the first case, the causative virus has been identified, its genetic makeup has been determined, and detection methods have been optimised. Scientists have also found that there is more than one strain circulating.

Despite these rapid advances, there is still significant uncertainty. Scientists don’t yet fully understand its transmission route, although person-to-person transmission, through inhalation of droplets in the air, is the most common mode. Another uncertainty is its low detection rate, especially with mild or asymptomatic cases. A third is how weather could affect transmission.

Currently, Africa has very few cases of COVID-19 compared with most other parts of the world. The highest number of cases has been reported in Egypt (currently 126 cases). It remains unclear why this is so. But the trend has generated several kinds of reactions, such as doubts around the slow spread despite the weak health systems in most of the countries, and some attributing the low spread to a low level of urbanisation.

Other factors being cited include the fact that cases are more recent, giving countries more time to prepare, as well as a lack of testing capability.

There is also speculation that the virus has not spread because it cannot thrive in warmer regions, like much of sub-Saharan Africa.

The environment and respiratory virus transmission

Among the several environmental factors that influence the survival and spread of respiratory viral infections, air temperature plays a crucial role. Cold weather makes the respiratory system sensitive to infections. This is why people tend to suffer from respiratory infections during cold winter months. In tropical climates, influenza and respiratory viruses are transmitted more during the cold rainy seasons.

Despite the uncertainties surrounding its spread, the SARS-CoV-2 virus may be following this pattern.

Other members of the coronavirus family have displayed a certain degree of sensitivity to weather patterns. For instance, cases of the Severe Acute Respiratory Syndrome (SARS) were 10 times higher in lower temperatures than higher ones.

However, the effect of air temperature is also related to other factors, such as relative humidity as these viruses prefer low humidity.

Also, the Middle East Respiratory Syndrome (MERS) coronavirus was stable in air at low temperatures which could favour its spread. Despite this, the virus did not observe a seasonal trend but rather occurred sporadically. Other factors, such as animal (camel-to-human) transmission and weakened immune systems, also favoured its spread.

Temperature and SARS-CoV-2

A look at the temperature data of the most affected countries outside China – South Korea, Italy, Iran and Spain – shows that the mean monthly temperatures between January and March of 2020 range between 6 and 12 degrees Celsius.

In sub-Saharan Africa, most countries that have recorded cases of COVID-19 – such as South Africa, Nigeria, Senegal, Togo, Cameroon and Benin – had mean monthly temperatures of 20 to 32 degrees Celsius in this same period. Meanwhile, Algeria and Egypt – North African countries that have seen cases – had monthly temperatures between 11 and 17 degrees Celsius.

Therefore, previous coronaviruses spread more during the colder winter months. Also, there are marked temperature differences between the most affected (colder) and least affected countries (warmer) in the COVID-19 pandemic.

But this pattern alone cannot fully explain the current low number of cases in affected African countries.

The first reason is that following the onset of the outbreak in December in China, measures were taken to prevent the transportation of the virus to other places outside China. This allowed many countries to prepare for any new cases. Secondly, the cases in the African countries are recent, and the first affected persons have been quarantined. Thirdly, many countries do not have adequate capability to test for the virus.

These factors, together with the higher temperatures, could contribute to the apparent lower spread.

African countries need to prepare more

Now that the virus has made its way into Africa, countries on the continent need to be more prepared for greater action to contain the virus, especially if it follows a seasonal pattern.

For example, the peak circulation of flu in South Africa is in the winter season between April and July. In Senegal, the peak season is in the rainy season, from July to October. Many other African countries experience these peaks during the cold rainy season. This could mean that the preparedness of most African countries may soon be tested when these seasons come, especially as many more countries are confirming imported cases into the continent.

African countries need to strengthen their capacity in terms of identifying new cases. Health-care facilities and personnel need to be well equipped to manage identified cases. The general public needs to be sensitised on how to go about getting medical attention if they suspect any signs or symptoms. Personal and household hygiene practices using detergents, such as bleach, need to be encouraged to prevent possible environmental transmission.

The Conversation

Akebe Luther King Abia is affiliated with the Antimicrobial Research Unit, University of KwaZulu-Natal. He is also an Aspen New Voices Fellow, Class of 2020.

Source: COVID-19 in Africa: fewer cases so far, and more preparation needed

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Africa, South Africa, AfroFuture, Egypt, Morocco, Ghana, Johannesburg, Accra, Cairo, Durban, Cape Town, Casablanca, Kenya, Pretoria, Angola, Luanda, Nairobi, Nigeria, Lagos
https://i0.wp.com/assets.rebelmouse.io/eyJhbGciOiJIUzI1NiIsInR5cCI6IkpXVCJ9.eyJpbWFnZSI6Imh0dHBzOi8vYXNzZXRzLnJibC5tcy8xODY4OTg3Ny85ODB4LmpwZyIsImV4cGlyZXNfYXQiOjE1NTQyNzEzNjh9.Ow_Fupf2NwVELdD3E4ExkZu68nmqeprJ4NjOCqjeNCg/img.jpg?w=1170&ssl=1

 


Africa’s 10 wealthiest cities:

1. Johannesburg (South Africa): $276 billion

 

2. ​Cape Town (South Africa): $155 billion


3. Cairo (Egypt): $140 billion


4. Lagos (Nigeria): $108 billion


5. Durban (South Africa): $55 billion


6. Nairobi (Kenya): $54 billion


7. Luanda (Angola): $49 billion


8. Pretoria (South Africa): $48 billion


9. Casablanca (Morocco): $42 billion


10. Accra (Ghana): $38 billion



source: https://bigthink.com/strange-maps/richest-cities-in-africa

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Africa, South Africa, AfroFuture, Egypt, Morocco, Tunisia
  1. According to projections by the United Nations World Populations Division, one fifth of the worlds population will be African by 2030. In simpler terms 1 in every 5 people walking the earth in 2030 will be African.

    Let that sink in…

  2. Since 2000 at least half of the world’s fastest growing economies are located in Africa. To boot, Africa’s most advanced economies —Egypt, Morocco, South Africa, and Tunisia— are diversified. Services, such as banking, telecom, and retailing, have accounted for more than 70% of GDP growth in these countries over the past decade.

  3. 93% of Africans have access to the mobile economy. The overwhelming majority of Africans today have access to a mobile phone service. According to research by Afro Barometer, mobile phone networks have grown faster than any other area of core infrastructure.

  4. Africa has the worlds fastest growing middle class. Currently only 5% of Africans pass the “Fried-Chicken Test” (can afford to spend $10 on a fried chicken lunch). In 2008, 16 million African households had incomes above $20,000 a year—a level that enabled them to buy houses, cars, appliances, and branded products. Another 27 million households earned $10,000 to $20,000. In addition, 41 million households reported incomes of $5,000 to $10,000—the level at which families start spending more than half their income on nonfood items. By 2020 the total number of households in all three segments will reach 128 million, which should make Africa one of the fastest-growing consumer markets of this decade.

  5. 25% of the worlds workforce will reside in Africa by 2050. The number of people in Africa in the 25-59 year age bracket – classed as the main working-age population – is projected to reach one billion by 2050. This implies the proportion of the world’s working-age people who are based in Africa will double – and they’ll make up almost a quarter of the world’s potential workforce.

The World Economic Forum has stated it best: The Future Is African.
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Africa, South Africa

In recent times, South Africa has become one of the global best-emerging markets. The country has witnessed significant improvements due to a combination of advanced first-world financial markets and a fast-paced economy. As a result, existing and new products or services are gaining market entry.

As part of efforts to record a meaningful international growth in her economy, South Africa has provided a unique investment environment and entrepreneurial motivation programs that would, unavoidably, bring about global opportunities and competitive advantages. Some of these processes are captured in the National Development Plan (NDP) that aims to eradicate poverty by 2030 by expanding economic opportunities by ensuring exports diversification, encouraging market entry for new and existing businesses, implementing reforms to reduce the cost of doing business, and motivating innovation and entrepreneurship.


Why Existing and New Businesses Should Take Advantage of Market Entry?

With the international growth the country is enjoying, now is the best time for new and existing businesses to gain market entry. And here are some of the reasons to come on board:

  1. Construction and Improvements of Infrastructure

From a forward-looking perspective, the Government has committed to upgrading existing infrastructure and building new ones as evident in the construction of ports, railway systems, electricity plants, hospitals, and dams.

  1. Diversification of the Economy

South Africa’s manufacturing sector has been diversified to allow different types of business to gain market entry and grow stronger. The major sectors include metal fabrication, agro-processing, automotive, clothing and textile, pharmaceuticals, leather and manufacturing, capital and rail transport equipment, advanced manufacturing companies among others.

  1. Introduction of Incentives

That the country is gaining international growth is not enough to achieve a significant change in the economy of South Africa. The government offers a wide range of incentive schemes aimed at stimulating and encouraging market entry by various products and services. The incentive can be in the form of tax relief or provision of funding.

  1. Stable Exchange Rates

One of the factors that discourage market entry by new businesses is the volatile foreign exchange rate. However, the Rand- Dollar exchange rate has remained less volatile and tends to be predictable in the medium time. Thus, the differences in the cost of doing business will not be staggering.

  1. Developing Market Opportunities

South Africa is considered to be the stepping stone and a link for creating market opportunities in Sub-Saharan Africa. With this development, more suppliers will come up. A conservative market bias will also be eradicated and the door will be opened to new investors and businesses.

If you are a new startup or an existing business, South Africa is one of the best countries to take your business to. It is cheaper to run your business and expand your reach. Maximize the potential of your business by making a market entry in South Africa.

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