Forbes Says Strive Masiyiwa’s Fortune Increased To $2.3 Billion, Did It Really?

When it comes to naming the who is who of the rich there is no greater authority than Forbes. Every year they produce a coveted list of the world’s richest according to various criteria including naturally Africa’s richest. In fact Forbes have a real time tracker that shows you how rich a person (we are talking about people who matter here not you and me) is at any given time.

2019 Africa’s top ten richest

For the eighth year Aliko Dangote is Africa’s richest man with an estimated fortune of $10.3 billion
Mike Adenuga another Nigerian with a net worth of $9.3 billion
Nicky Oppenheimer of De Beers with $7.3 billion
Nassef Sawiris with $6.3 billion
Johann Rupert $5.3 billion
Issad Rebrab $3.7 billion
Naguib Sawiris $2.9 billion
Strive Masiyiwa $2.3 billion

To keep Mr Masiyiwa company we have Isabel Dos Santos (who made her fortune in looting), Patrice Motsepe the mineral guy, Mohamed Mansour (who is into all sorts of things) and Koos Bekker. That makes them ten .

A terrible year for Africa’s richest except Masiyiwa and three others

In general it was not a good year for Africa’s billionaires in general as most saw their wealth shrink due to a widespread falls in stock markets. In fact while there were 23 billionaires in the whole of Africa last year there are only 20 left at this moment.

Of these 20 all except four saw a decline in their fortunes. The billionaire with the biggest increase in net worth was Mr Masiyiwa. Last year his fortune was estimated to be $1.6 billion now he is said to be worth $2.3 billion. In a space of 12 months he added $700 million to his net worth not bad at all for a year’s work. But did he really increase his net worth by that much? Something in the Forbes article caught our eye:

Among the few on the list who are richer than a year ago is Strive Masiyiwa of Zimbabwe, worth an estimated $2.3 billion, up from $1.6 billion last year. He’s richer due to a rise in the share price of Econet Wireless Zimbabwe and a new investment that boosted the value of his stake in fiber-optic and satellite-services firm Liquid Telecom.

Forbes goes on to explain their methodology on exchange rates:

We calculated net worths using stock prices and currency exchange rates from the close of business on Friday, January 4, 2019.

Now why is that important? Well while we do not doubt the astounding business acumen of Mr Masiyiwa, he is amazing no doubt but $700 million really? Not only did he bucked the trend, he did it in a stupefying way. We cannot help however but think he had a little help- from bollars.

Remember just before last year ended we warned you about taking Zimbabwean financial results with a pinch of salt. Well we meant exactly this. There has been a recent increase in business profits, revenue and share prices despite ( we mean as result) of the ongoing economic crisis.

Officially the bond note and RTGS balances are at par with the USD but we all know better. The prices of all manner of commodities ( including stocks/shares) have increased in order to take into account the fact that the RTGS balances are not the same as real USD. It is a fact that in general the Zimbabwean Stock Exchange uses bollars and RTGS although it does benefit form the occasional foreign investor.

Conflating bollars, USD and RTGS is a mistake on Forbes’ part. An understandable one though considering they really have no viable official and alternative way to discount the value of bollars and RTGS and incorporating them into their net worth figures. To be fair, maybe they take these things into account but no mention is made of this on their list.

In business we always try to separate between real and nominal changes. In real terms I do not think Mr Masiyiwa’s fortune increased by $700 million.

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