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Third of Himalayan Glaciers Can No Longer Be Saved, Study Says @business @AP
Kathmandu, Nepal (AP) -- One-third of Himalayan glaciers will melt by
the end of the century due to climate change, threatening water
sources for 1.9 billion people, even if current efforts to reduce
climate change succeed, an assessment warns.
If global efforts to curb climate change fail, the impact could be far
worse: a loss of two-thirds of the region's glaciers by 2100, said the
Hindu Kush Himalaya Assessment released Monday by the International
Centre for Integrated Mountain Development.
"Global warming is on track to transform the frigid, glacier-covered
mountain peaks of the Hindu Kush Himalayas cutting across eight
countries to bare rocks in a little less than a century," said
Philippus Wester of the center, who led the report.
Two nights ago the Northern Lights made a rare appearance in the skies
above the Lake District: glowing scarves of light, swirling above the
peaks. My father took this image of the aurora — Orion gleaming, the
Milky Way’s aura, and an ancient ash tree keeping time on the earth.
The upper deck pool gives guests a chance to splash around in the open air. @business
Would-be buyers submitted sealed bids to the Sheriff of the High Court
of Malaya. Only after the bids were submitted was the appraisal value
of $130 million revealed. “Some bidders were opportunistic in their
pricing,” said Sitpah Selvaratnam, a consultant with law firm Tommy
Thomas and adviser on the transaction.
“As it stands now the mandate is we are not really negotiating for
anything below $100 million,” Selvaratnam said. “It’s clearly not a
fire sale. You’re going to get what she’s worth.”
@MedvedevRussiaE then Russia's president, to greet a dear guest: Hugo Chavez, president of Venezuela. "I've missed you," Mr Medvedev told the Comandante, using the familiar Russian form, ty. "You are a friend and comrade to me, Dmitry"
Law & Politics
ONE MORNING in September 2009, a gaggle of powerful Kremlin figures
lined up at the residence of Dmitry Medvedev, then Russia’s president,
to greet a dear guest: Hugo Chávez, president of Venezuela. “I’ve
missed you,” Mr Medvedev told the Comandante, using the familiar
Russian form, ty. “You are a friend and comrade to me, Dmitry,” Chávez
responded, passing on greetings from “mutual friends” including
Muammar Gaddafi and Bashar al-Assad. “Russia is a superpower again,”
he continued, “and Venezuela is a nucleus of the pole of power in
Since then, Gaddafi has been killed and Mr Assad has endured thanks
only to Russia’s firepower. The future of Chávez’s successor, Nicolás
Maduro, hangs by a thread. Protesters are on the streets of Caracas.
Latin American countries and the United States have recognised the
opposition as Venezuela’s legitimate government. Europe is
sympathetic. But Russia sees its vital interests at stake in Mr
Since 2006 Russia has lent Venezuela at least $17bn. Some of that debt
has been restructured, but Venezuela still owes Russia $6bn, half to
Rosneft. Instead of hedging its bets, Rosneft has continued to pile
into Venezuela since Chávez’s death.
The point was driven home by Mr Maduro’s visit to Moscow in December
2018, as pressure on him was rising at home. Days later Russia sent
two nuclear-capable TU-160 bombers to Caracas. The 10,000km-long
airshow prompted a tweet from Mike Pompeo, secretary of state,
denouncing it as “two corrupt governments squandering public funds,
and squelching liberty and freedom”.
This helps explain Russia’s defensive response to the revolt against
Mr Maduro. “We are witnessing how [a crowd] elects a new head of state
on a square despite the constitution”, Mr Medvedev tweeted. (Replies
included “you idiot, why did you give Maduro $17bn-worth of loans” and
“you are next”.) State television channels ascribe Venezuelan unrest,
along with the revolution in Ukraine in 2014, to the interference of
the United States, and warn of a similar scenario at home.
Vladimir Frolov, a foreign-relations analyst, argued in a recent
column that the backing by the United States of regime change in
Venezuela challenges Mr Putin’s core belief in “unrestricted
sovereignty” and the right of rulers to use force to stay in power. He
thinks it is this, rather than Russia’s ill-advised investments in
Venezuela, that is behind the attempt to prevent Mr Maduro’s
overthrow. Russia may have sent the Wagner troops to protect him from
any rebellion by his own forces. Asked about the presence of Russian
forces by RIA Novosti, a Russian news agency, Mr Maduro protested too
much: “I can’t say this. No comment. I don’t make any comment. I have
no commentary on the subject.”
If Venezuela goes up in flames, Russia can always blame the United
States for destroying its investment. But if Mr Maduro does fall,
abandoned by his army and hated by his people, Mr Putin would have
more to worry about than squandered investments.
04-FEB-2019 :: Venezuela, Iran, DR Congo
Law & Politics
— Time changes, and our desires change. What we
believe—even what we are—is ever-
changing. The world is change, which forever
takes on new qualities.
Lets start with Destination Caracas Venezuela. Here years of sanction
warfare [The Star Aug 2018 @realDonaldTrump seems to be relishing his
financial warfare strategies. Nicolas Maduro in Venezuela is being
attacked by remote-controlled drone] accompanied with rank
mismanagement has brought the country to that Hunter S. Thompson brink
"The Edge... There is no honest way to explain it because the only
people who really know where it is are the ones who have gone over,"
Hunter. S. Thompson.
If one accepts that access to oil ''defined 20th-century empires and
the petrodollar agreement was the key to the ascendancy of the United
States as the world’s sole superpower'' America’s war machine runs on,
is funded by, and exists in protection of oil. Threats by any nation
to undermine the petrodollar system are viewed by Washington as
tantamount to a declaration of war against the United States of
America. The Chavez Revolution was always a rebellion in the
Superpower's back yard and the machine was eventually going to bring
it to heel by hook or by crook.
The Oriental Review's Andrew Korybko headlines his Article ''A
Venezuelan Coup Could Challenge OPEC+ And Build “Fortress America”
Russia and China aren’t capable of directly defending Venezuela even
though they’ve voiced their support for international law, and their
real national interests rest with ensuring that Caracas repays its
billions of dollars of loans to them and respects the energy and
military deals that were previously signed despite not having any way
of guaranteeing that will happen if Maduro is overthrown. Therefore,
the most likely international outcome of his ouster would probably be
that the Washington-backed coup “authorities” would declare those
deals null and void, after which they’d likely open up the world’s
largest oil deposits in the Orinoco Belt to US companies. The
long-term repercussions are that the US could challenge Russia and
Saudi Arabia’s OPEC+ alliance and advance its “Fortress America”
geopolitical project in the Western Hemisphere
Maduro is I am afraid going down just like Muammar went down and as did Saddam.
Apple Edges Out @Microsoft , @amazon to Retake Most Valuable Crown @business
Apple Inc. is once again the world’s most valuable company -- but at a
much lower level than its former peak.
The iPhone maker reclaimed the mantle of world’s largest stock by
market capitalization on Tuesday, edging out Amazon.com Inc. and
Microsoft Corp. for the first time in two months.
The list of the biggest names on Wall Street has been repeatedly
shuffled this year, with each of the megacap technology names holding
the top spot at some point.
The Cupertino, California-based company had a market capitalization of
$821 billion on Tuesday after rising for five straight days, inching
past Microsoft at $819 billion and Amazon at $816 billion.
At current levels, it would be the first time Apple has had this
distinction on a closing basis since Dec. 3, according to data
compiled by Bloomberg.
Apple rose 1.7 percent on Tuesday, while Amazon was up 1.7 percent and
Microsoft rose 0.9 percent.
Disappointing iPhone sales have weighed on Apple over the past three
months, causing the company’s market value to plummet more than
technology peers, allowing Amazon and Microsoft to jockey for the top
Despite a recent rally fueled by optimism following Apple’s fiscal
first-quarter earnings report, the stock is down 26 percent from a
record high in October, back when it had a market cap above $1.1
That translates into more than $300 billion in lost market value.
Not too far behind the top three is Alphabet Inc., the parent company
of Google, which has a market cap of $785.7 billion. The company
dipped 0.5 percent on Tuesday in the wake of its quarterly results.
Think Different Wikipedia
The Crazy Ones
Here’s to the crazy ones. The misfits. The rebels. The troublemakers.
The round pegs in the square holes. The ones who see things
differently. They’re not fond of rules. And they have no respect for
the status quo. You can quote them, disagree with them, glorify or
About the only thing you can’t do is ignore them. Because they change
things. They push the human race forward. While some may see them as
the crazy ones, we see genius. Because the people who are crazy enough
to think they can change the world, are the ones who do. - Apple Inc.'
$CL_F #WTI @chigrl 53.66
$CL_F #WTI (SHORT term) everyone sees an H&S, I see ascending
broadening wedge (which would not negate you H&S lvers pattern, but pb
may be more deep than you expect) Bulls need a solid move (full candle
close) over this wedge TL. Bears will be looking for downside targets
Cobalt hits 2-year low as DRC ramps up supply @FT Price for the key battery metal has fallen more than 40% since mid-November
Cobalt prices have hit their lowest level in two years after a supply
surge from the Democratic Republic of Congo, giving a lift to
carmakers eyeing the electric-car market.
The price for the key battery metal has fallen more than 40 per cent
since mid-November to trade at between $18.75 and $20.35 a pound,
according to Fastmarkets.
That is likely to ease concerns for carmakers about securing supplies
of the metal, almost two-thirds of which comes from the Congo, one of
the poorest countries in the world.
Cobalt prices hit a 10-year peak of more than $40 a pound last April,
leading some of the largest battery makers to accelerate plans for
The big drop in prices since then could ease fears about current
lithium-ion battery technology and allow for a swifter rollout of
electric cars, according to Caspar Rawles, an analyst at Benchmark
Mineral Intelligence. Some carmakers could also be tempted to lock in
supplies through long-term deals with miners, he added.
“Not only will this enable [carmakers] to feel more secure about
future pricing and act more aggressively on their EV [electric
vehicle] production ramp-up plans, but longer-term deals may also
sustain higher levels of cobalt use in [battery] cathode technology,”
Global sales of plug-in electric cars hit about 2m last year, rising
66 per cent, according to analysts at Bernstein. This was driven by
sales in China, the world’s largest EV market.
But many companies in the battery supply chain built up stocks of
cobalt last year, according to traders, and the market is not likely
to be short of supply in 2019.
Since then Luxembourg-based Eurasian Resources Group has started
production of its copper and cobalt project in the DRC, and a host of
Chinese-owned mines are also set to boost output.
Glencore is also building large stockpiles of cobalt in the DRC
following the discovery of uranium at its Katanga mine that has left
it unable to export.
The miner said last week that Katanga would be unable to sell its
cobalt until 2020 because of a dispute with the government over the
building of an ion-exchange plant to remove the uranium from its
That metal is likely to hit the market just as the battery supply
chain needs to restock, according to analysts.
Benedikt Sobotka, chief executive of Kazakh-owned Eurasian Resources
Group, said that while the cobalt market would be volatile, rising
sales of electric cars would feed through to higher prices.
The world’s largest battery producers are spending billions of dollars
to expand capacity to meet demand from carmakers. Last month, Toyota
and Panasonic said they would launch a joint venture to produce
batteries for electric cars.
“The upward price movement is likely to be achieved through a
combination of restocking, improved investor sentiment, supply
disruptions and, last but not least, a strong underlying demand for
electric vehicles,” Mr Sobotka said. “New energy vehicles remain the
most potent driver for cobalt demand, and it is forecast that 2019
will see even stronger growth rates than 2018.”
The "debt-trap" narrative around Chinese loans shows Africa's weak economic diplomacy @qzafrica @Lattif @Anzetse @gyude_moore @LBenabdallah @RAbdiCG
Hugging the shores of the Indian Ocean, Kenya’s Mombasa port is one of
the biggest and busiest harbors in East Africa.
Almost 1,800 vessels docked at the port in 2017 alone, with cargo
worth over 30 million tons processed—much of it heading to neighboring
or landlocked nations including Uganda, Rwanda, Burundi, and DR Congo.
Since its opening in the mid-1890s, the seaport has developed to be a
rising regional hub and a key cog in Kenya’s growing infrastructural
In December, reports surfaced the prized port was used as collateral
for the $3.2 billion loan that was used to construct the 470-kilometer
(292 miles) rail line between the seaside city and the capital
In a leaked report linked to the auditor general’s office, Kenya was
said to risk losing its port if it defaulted on the loan, with the
Exim Bank of China taking over the port authority’s “escrow account”
to regain revenues.
Further reports have even noted it goes beyond just one asset that’s
been put up as collateral and that “any state” possession was on the
table in the event of a non-payment.
The revelations caused an immediate furor and triggered denials from
both Chinese and Kenyan officials. China is currently Kenya’s largest
bilateral creditor, and many raised questions about the mounting risks
the East African nation faces as it borrows more money to fund large
The uproar also brought to fore the issue of “debt trap diplomacy”: a
term that has gained popularity in the lexicon of global geopolitics
as China flexed its influence worldwide.
The specter of Beijing extracting economic or political concessions
from a nation unable to pay its debt obligations was first underscored
in Dec. 2017, when Sri Lanka gave 70% equity and a 99-year lease for
its strategic Hambantota port.
Since then, nations from Djibouti and Maldives to Laos and Pakistan
have been named as facing risks of debt distress, especially in the
face of the multi-billion dollar Belt and Road initiative.
Last year, Beijing was also accused of taking over Zambia’s national
electricity supplier and rebuilding the Mogadishu seaport in exchange
for “exclusive” fishing rights along the Somali coast—allegations that
proved inaccurate and officials have refuted.
Western leaders, drawing on these examples and wary of China’s rising
financial and economic might, have cautioned African states from
taking out these loans.
Observers have also pointed to the fact Beijing offers financing with
fewer strings attached and isn’t part of the global multilateral
framework for official creditors known as Paris Club.
This has raised questions about the transparency, sustainability and
commercial viability of Chinese state-sponsored lending, which have
grown tenfold in the past five years in Africa.
And with no officially-published contracts or “no written predictable
rules” of how Beijing responds to a loan default, “people are free to
speculate,” says W. Gyude Moore, a visiting fellow at the Center for
Between 2000 and early 2019, there were 85 instances when China
canceled or restructured debt globally—including most recently in
The Sri Lanka port remains the only place in the world where Beijing
took control of a state asset, with observers noting that officials
understood the damages “debt book diplomacy” could bring to China.
Yet Beijing’s debt relief or repayment actions, Moore notes, remains
“haphazard. It’s unpredictable. There’s nothing written. It’s
Chinese loans are currently not a major contributor to the debt burden
in Africa; much of that is still owed by traditional lenders like the
Yet Kenyan economist Anzetse Were says the debt-trap narrative along
with anti-Chinese sentiment has intensified because African nations
like Kenya not only have a fundamental problem with fiscal
transparency but also because the continent’s past relationship with
external forces both pre and post independence was one “defined by
The general public, she said, remain in the dark about the deals with
China. “We don’t know how much we owe; we don’t know the terms.”
Yet that shouldn’t detract from the agency of African leaders to
saddle their nations with unnecessary debt, says Lina Benabdallah,
assistant professor of politics at Wake Forest University in North
Carolina. “The problem is not borrowing money; the problem is managing
it and making sound decisions as to how to pay it back.”
The opacity surrounding Chinese deals in Africa—besides those signed
with the US and Europe— also showcases, Were says, Africa’s weak
economic diplomacy and the deficiency in creating institutional
frameworks catering to taxpayer interests.
This is especially crucial in a multipolar world where the scope of
interest and engagement in Africa is widening beyond China, the EU,
and the US to include Brazil, Turkey, India, Japan, and the Gulf
And with no capacity to effectively negotiate, Were argues “their
agendas will drive our response rather than our agenda meeting them
with their interest and seeing how we can both benefit.”
This is especially true of smaller nations with weak governments like
Somalia, which not only faces technical and resource constraints but
also the mechanisms to “ensure compliance, financial probity, and
oversight,” says Rashid Abdi, the Horn of Africa project director at
the International Crisis Group.
Because there’s no frame of reference for Chinese deals, Moore, who
previously served as Liberia’s minister of public works, says African
governments can improve their capacity to negotiate by drawing support
from global litigation services.
These include the African Legal Support Facility hosted by the African
Development Bank or pro-bono entities like the International Senior
Lawyers Program. Mobilizing these resources, he adds, could improve
the quality of project selection and the process of delivering them.
Growing effective at these negotiations will be crucial as China faces
an economic slowdown, ballooning debt, internal criticism on why it
was spending taxpayers’ money abroad, besides external reproach that
its Africa presence was akin to neo-colonialism. The state-funded
insurance firm Sinosure, for instance, recently said it lost up to $1
billion on the Addis-Djibouti railway.
Moore says that means the “validity and legitimacy” of Chinese loans
will continue to be questioned if done in secret, especially if a
nation is committing to an obligation for two to three decades.
“China doesn’t have to sign up to the Paris Club rules,” Moore
explains. “China can write up its own rules and publish them.”
In the meantime, Were says African citizens have to agitate for and
build technocratic governments that are responsive democratically.
That’s “probably the biggest challenge for our generation.”
Nigeria election dominated by 'timebomb' of youth unemployment @FT
Yau Umar said he had barely managed to earn $3 on a recent weekday at
his open-air barbershop, which operates under a sheet of tin hanging
off a half-built building in Kano. A few years ago, he lamented, he
had made five or more times that amount in a day.
The barber pinned the blame for the plunge in his income on President
Muhammadu Buhari, who he said was guilty of mismanagement that had
sapped people’s earnings and turned even a haircut into a luxury.
“Buhari promised us, but he couldn’t do it — that’s why we can’t vote
for him,” said Mr Umar, 26.
Mr Buhari is seeking re-election on February 16 in Africa’s most
populous nation and his record on jobs is one of his greatest
vulnerabilities. Running against him is former vice-president Atiku
Abubakar, a wealthy businessman whose pointed campaign slogan is
“Let’s Get Nigeria Working Again”.
Mr Umar said he knew few people with steady employment in Kano, a city
of 4m that is the commercial centre of the north — and a microcosm of
a national problem.
Since Mr Buhari took office in 2015 the unemployment rate in Africa’s
largest economy has soared, rising from 8.2 per cent to 23.1 per cent
in the third quarter of 2018, according to the most recent data.
Another fifth of the working-age population are underemployed. For
young people aged 15 to 35, who make up more than half of registered
voters, the figures are even worse: 55.4 per cent are unemployed or
Abdulmalik Kabir, a 32-year-old market trader who had just finished a
shave in the barber shop, said: “I voted for Buhari in 2015 and we
were expecting him to do the right thing for Nigerians, but now we
know . . . he is ruining Nigeria.”
At a business forum in Lagos last month, Mr Abubakar warned that
jobless youths were “like a time bomb”. “We must create jobs — if not,
we will get mobbed one day by the unemployed youths,” he said.
Both he and Mr Buhari have announced plans for tackling the problem,
with a shared focus on promoting apprenticeship programmes, vocational
training and entrepreneurship.
But Nonso Obikili, director at the Abuja-based Turgot Centre for
Economics and Policy Research, said that neither candidate’s plan
tackled “the systematic problems behind unemployment”.
One jobs training programme touted by Mr Buhari, named Npower, had
provided training to only “a very small minority of youth”, said Mr
Obikili. Mr Abubakar’s policies, meanwhile, regurgitate “the regular
youth empowerment schemes that have not really had any impact over the
Andrew S Nevin, chief economist for PwC in Nigeria, said that with the
working age population of Nigeria growing at roughly 3 per cent a
year, the country’s economy would need to expand at 6-8 per cent
annually to reduce youth unemployment. In each of the past two years
gross domestic product growth has been only about 2 per cent.
“While these issues are being discussed in the election, the issue is
whether the winner will take on reforming these difficult structural
policies,” said Mr Nevin.
Other solutions proposed by the presidential candidates included
boosting Nigeria’s credentials as an investment destination and
decentralising growth beyond the dominant commercial centre of Lagos.
But as is often the case in Nigeria, implementation remains key.
There was no consensus at the barbershop. Sani Mukhtar, who sells
mobile phone top-up cards from the open-air shop, said the president
was doing a good job.
The economy had slowed, Mr Mukhtar said, because Mr Buhari had slowed
the flow of corrupt money that had flooded the economy during the
administration of his predecessor.
That, combined with a recession brought on by the oil-price crash, had
ground things to a halt. But the pain was worth it in order to stamp
“Buhari is a gentleman — Buhari is not a thief,” Mr Mukhtar, 44, said.
“He’s done a good job on defence, on roads construction, on
electricity and power.”
The administration has touted its achievements in all three areas —
particularly infrastructure spending which it said had dwarfed its
predecessors — though a resurgent Boko Haram, the jihadi group, still
threatens the country’s north-east.
Even university graduates are finding it difficult to find good work.
Badamasi Aliyi, 35, said many of his educated peers had found
themselves repairing mobile phones or doing menial labour — or
nothing. Three years ago that realisation prompted him to co-found
Startup Kano, an incubator intended to help small businesses get off
the ground. “One of the reasons Startup Kano came into being was to
show that entrepreneurship is a solution.”
He said he did not blame Mr Buhari for the rise in unemployment and
pointed to small business empowerment programmes the administration
had developed. Like many supporters, he also argued that the
anti-corruption measures Mr Buhari had implemented would eventually
save the country billions of dollars, even if for now they took some
steam out of the economy.
Back at the barbershop, Mr Umar argued with his friend, Mr Mukhtar,
over who was to blame — Mr Buhari, whose four years had seen sluggish
growth, or Mr Abubakar, whose party ruled the country for the 16
Sani Musa, 32, a textile tradesman who said he would vote for Mr
Abubakar, offered another common Nigerian refrain: maybe both were to
blame. “It’s all the same,” he said.
10 NOV 14 ::Ouagadougou's Signal to Sub-Sahara Africa
What’s clear is that a very young, very informed and very connected
African youth demographic [many characterise this as a ‘demographic
dividend’] – which for Beautiful Blaise turned into a demographic
terminator – is set to alter the existing equilibrium between the
rulers and the subjects, and a re-balancing has begun. We need to ask
ourselves; how many people can incumbent shoot stone cold dead in such
a situation – 100, 1,000, 10,000? This is another point: there is a
threshold beyond which the incumbent can’t go. Where that threshold
lies will be discovered in the throes of the event. Therefore, the
preeminent point to note is that protests in Burkina Faso achieved
escape velocity. Overthrowing incumbents is all about acceleration,
momentum and speed best characterised by the Ger- man word
Tanzania Mulls Renegotiating Gas Contracts It Deems Unfavorable @business
Tanzania said it might renegotiate natural gas contracts if its review
finds terms agreed as far back as two decades unfavorable to the East
The assessment of 11 agreements started two months ago and is the
latest in a series of measures by President John Magufuli’s government
to secure more revenue from the country’s resources. Tanzania has 58
trillion cubic feet of natural gas reserves, some of which is being
developed by companies including Royal Dutch Shell Plc and Equinor
In 2017, Magufuli assented to legislation including the Natural Wealth
and Resources Contracts law that allows the government to renegotiate
or remove terms from agreements deemed by it to be “unconscionable.”
“Should we find they have questionable terms then we will ask the
investors to renegotiate them,” Energy Permanent Secretary Hamisi
Mwinyimvua said in an interview on Monday.
Equinor, which has invested over $2 billion developing Block 2, said
its Production Sharing Agreement with the government is still valid,
according to spokesman Erik Haaland. It operates and holds the
majority of the working interest in the block. Shell and Ophir Energy
Plc have interests in Blocks 1 and 4.
The contracts review comes even as companies including Equinor
continue separate government talks to build a $30 billion
liquefied-natural-gas plant in Lindi, about 450 kilometers (280 miles)
south of the commercial capital, Dar es Salaam.
Haaland said Equinor agreed with Tanzania to start negotiating a
so-called host government agreement for the project that’s been under
planning since 2014.
“An LNG development is a large project that requires large upfront
investments,” he said. “To ensure that all parties benefit from such a
project, stable and predictable framework conditions for the more than
30-year lifetime of the plant is essential. We trust that the
government of Tanzania has a long-term view on this major industrial
The new laws include the Permanent Sovereignty Act that requires
parliamentary approval for future agreements, which must “fully
secure” the interests of Tanzanians. It also restricts exports of raw
minerals, repatriation of funds and access to an international dispute
Changes in the Mining Act established a commission to regulate the
industry, overhauled the requirements for the storage, transportation
and processing of raw minerals, while increasing royalty rates and
government shareholding in mineral right.
In July 2017, the government slapped Acacia Mining Plc with a $190
billion tax bill, saying the gold producer had falsely declared
bullion exports since 2000, a claim the producer denied. The state
later settled for a $300 million tentative payment after a meeting
between Magufuli and the president of parent Barrick Gold Corp.
"The public debt-to-GDP (gross domestic product) ratio increased considerably over the past five years to 57 per cent at the end of June 2018," says the @AfDB_Group via @BD_Africa
A rapid build-up of costly public debt in the past five years has put
the Kenyan economy at the risk of turbulence, the African Development
Bank (AfDB) has warned in new research.
Kenya’s public debt crossed the Sh5 trillion mark for the first time
in June last year, representing a growth of 14.3 per cent over Sh4.41
trillion a year earlier.
The rise has shone a light on Treasury mandarins and renewing the
protracted debate on the country’s ability to carry the load in the
“The public debt-to-GDP (gross domestic product) ratio increased
considerably over the past five years to 57 per cent at the end of
June 2018,” says the AfDB in a new outlook. “Half of public debt is
The Treasury mandarins have often maintained that Kenya can bear its
current debt load.
The Treasury said last year it is engaging international investors
that Kenya owes money to ensure looming debt obligations are managed
effectively without exposing the country’s coffers to liquidity
“The share of loans from non-concessional sources has increased,
partly because Kenya issued a $2 billion Eurobond in February 2018,”
“An October 2018 International Monetary Fund debt sustainability
analysis elevated the country’s risk of debt stress to moderate.”
However, a $3.5b call now is tactically the right call, it kicks the can down the road.
Over the last few months, there has been a significant reduction in US
rate expectations. Expectations around growth have tilted lower. This
downshifting has seen the US interest curve shift significantly lower
and this in turn has boosted Frontier and SSA Sovereign debt prices
and lowered yields. For example, Kenya’s 30 Year Eurobond denominated
in Dollars was close to 10% and has rallied about 100 basis points off
those levels. Therefore, from a tactical perspective it was good to
see the Treasury move with despatch to seize the opportunity. We
learnt last week that Kenya is seeking proposals for issuance of
$2.5bn Eurobond - source ‘’They want to assess whether it would be
cheaper to borrow in euros or do- llars’’ the source told Reuters.
Kenya also announced that it had picked Standard Bank and TDB for $1
Billion of Syndicated Loans. Thats a $3.5b call right there. Now its
obvious we are fully loaded and this is a pheno- mena that’s not
unique to us. How we now deal with the balance sheet is key. However,
a $3.5b call now is tactically the right call, it kicks the can down