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Satchu's Rich Wrap-Up
 
 
Thursday 03rd of April 2014
 
Morning
Africa

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You will recall our #Mindspeak Session with @DeloitteEA last year RICH TV @YouTube
Africa


cc @sammyonyango @nikhil_Hira @oduorMartinO @amuraya @HarveenGadhoke

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Post #Mindspeak Interview with @Deloitte @YouTube
Africa


Geopolitical Musings
http://www.rich.co.ke/media/docs/038NSX3103.pdf

DON DeLillo in his book, Cosmopolis, says: "Everything is barely
weeks. Everything is days. We have minutes to live."

And certainly, the 21st century is a world hurtling at a dizzying velocity.

Macro Thoughts

Home Thoughts

Last of the great tuskers (c) Mark Deeble and A Wildlife Filmmaker in
Africa, 2014.
http://markdeeble.wordpress.com/2014/03/23/last-of-the-great-tuskers/

Ever since we started filming in Tsavo we'd looked for a big tusker -
but they are elusive. It's the reason they are still alive. They are
also very rare. They are bulls with tusks so large that they can rest
them on the ground.

There are probably only a dozen of the fabled '100+ pounders' left in
Tsavo's 16,000 square miles.

Kruger used to have its 'magnificent seven' - no longer. Tsavo's
collection of great tuskers is now the last in the world. They should
be national treasures, cherished by Kenyans and protected by
presidential decree, but they are not.

After two years of filming around Tsavo, we heard of one of the fabled
bulls. He was living on a community ranch, notorious for its gangs of
armed Somalis that poach elephants.  According to our source, the huge
bull hid in very thick bush during the day - only emerging to feed
when it was dark. Much as we wanted to film a true 'tusker', we felt
we couldn't risk searching for him. We'd only draw attention to the
area he hid in, and that would put him in danger. There was no
alternative but to wait.

Seasons passed without sightings.

I was about to do that one day, and took a last look out of the
filming 'window' when I glimpsed something through the heat haze.
Initially I thought the sun had reflected off the windscreen of a
distant vehicle, but there were no tracks close by. Whatever it was
disappeared, then glinted once more. Alert now, it was several minutes
before I saw it again. I came to the slow realization that what I was
looking at was sunlight reflecting off an elephant's tusks. Gradually,
like in the opening scene from 'Lawrence of Arabia', their owner
materialized through the shimmering haze.  A mirage from the Taru
desert - a magnificent, dusty behemoth.

Other elephants stood sleeping, clustered in the shade of acacias,
apparently unaware of the bull's approach. He didn't walk straight to
water. It took him almost an hour to cover the final kilometer as he
slowly zig-zagged from one bush to another. The glint I'd seen, came
whenever he turned his head and appeared to bury it in a bush. Each
time he did, he'd wait a few minutes, partially hidden, then continue
zig-zagging upwind, scenting the air, to check there wasn't a poacher
hidden at the waterhole.

I was mystified at the bull's poor attempt to hide - until it dawned
on me that he wasn't trying to hide his body, he was hiding his tusks.
At once, I was incredibly impressed, and incredibly sad - impressed
that he should have the understanding that his tusks could put him in
danger, but so sad at what that meant.

As he neared the waterhole, other elephants left the shade to gather
round and greet him. He was a magnificent bull; unmarked, apart from a
diagonal scar on his trunk. He had the largest tusks I've ever seen.
I've shown pictures of him to others, and his tusks are of such a size
and sweep, that even elephant experts of 40 years standing, have had
an audible intake of breath.

We saw him a number of times after that. Initially, I wondered if my
interpretation of his behaviour was fanciful, just a filmmaker's
frustration at not being able to get a clear view, but whenever we saw
him, he tried to hide his tusks and I am convinced that it was
deliberate.

I was thankful that the bull's wounds were healing and that we hadn't
had to dart him, but I was devastated that poachers had somehow
managed to predict his movements and get close enough to fire two
poison arrows into him.

I am appalled at what that means - that the survival skills that the
bull has painstakingly learnt over half a century have been rendered
useless by the poachers' use of mass-produced Chinese goods; GPS
smart-phones, cheap motorcycles and night vision goggles.

I think the old bull knows that poachers want his tusks, and I hate
that he knows.

More than anything, I hate the thought that poachers are now closing
in on one of the world's most iconic elephants.

For over half a century the vast expanse of the Taru desert has
provided him with refuge -  but it no longer seems vast enough.

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Sudan has announced that the president of South Sudan, Mr Salva Kiir Mayardit will visit Khartoum on Saturday to hold a summit with his Sudanese counterpart Omar Hassan al-Bashir.
Law & Politics


Sudanese ministry of foreign affairs spokesman Abu Bakr Al-sidig told
the Nation today that the one-day visit comes in response to an
invitation from President al-Bashir.

"The visit comes within the context of continued interplay between the
two countries to further develop their relations," Mr Alsidiq said.

Conclusions


They are Bedfellows now.

I wrote this on 30th January 2012 when the two were pounding each other.

South Sudan's oil cutoff: brilliant negotiating, or suicide? CSMonitor

http://www.csmonitor.com/World/Africa/Africa-Monitor/2012/0130/South-Sudan-s-oil-cutoff-brilliant-negotiating-or-suicide

The current stand off between Sudan and a newly independent South
Sudan made me recall an anecdote told by Henry Kissinger, after a
series of negotiations with Syrian President Bashar al-Assad's father,
the late President Hafez al-Assad.

"Assad never lost his aplomb. He negotiated daringly and tenaciously
like a riverboat gambler to make sure that he exacted the last sliver
of available concessions. I once told him that I had seen negotiators
who deliberately moved themselves to the edge of a precipice to show
that they had no further margin of maneuver. I had even known
negotiators who put one foot over the edge, in effect threatening
their own suicide. He was the only one who would actually jump off the
precipice, hoping that on his way down he could break his fall by
grabbing a tree he knew to be there. Assad beamed."

I will leave it to you to calculate who might be Hafez: South Sudan's
President Salva Kiir or Sudanese President Omar al-Bashir? Or both?

Neither Juba or Khartoum are ranked AAA by credit rating agencies.
Khartoum has lost a great chunk of their revenues. The South,
meanwhile, can hardly afford to lose the cash flow that comes from the
sale of its 350,000 barrels per day. And that's why I started with
Henry Kissinger's description, "I had even known negotiators who put
one foot over the edge, in effect threatening their own suicide."

It seems to me Sudan has become the epicenter of the US and China's
collision in Africa and that we are watching a 21st-century,
high-stakes proxy war. I have to surmise that the US is underwriting
Salva's overdraft, what with all these demobilized soldiers roaming
around Juba, it would be suicide to have them unpaid for any length of
time. I wonder who is underwriting Bashir? Maybe, he is calling in
favors in Libya?

South Sudan's President Salva Kiir (L) and Sudan's President Omar
Hassan al-Bashir walk at Juba airport July 9, 2011.

http://blogs.cfr.org/campbell/files/2011/07/africa-bashir-kiir-07122011.jpg

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Currency Markets at a Glance WSJ
World Currencies


Euro 1.3764 The euro has weakened about 0.8 percent versus the dollar
since ECB President Mario Draghi said on March 13 the exchange rate is
"increasingly relevant in our assessment of price stability."
Dollar Index 80.20 The Bloomberg Dollar Spot Index, which tracks the
greenback against 10 major currencies, was set for the highest close
in almost two weeks.
Japan Yen 103.91 The dollar was little changed at 103.89 yen as of
8:10 a.m. in London, after touching 104.07, the highest since Jan. 23.
Swiss Franc 0.8871
Pound 1.6640
Aussie 0.9228
India Rupee 60.11
South Korea Won 1056.81
Brazil Real 2.2698 Brazil Raises Key Rate for Ninth Straight Meeting to 11%
Egypt Pound 6.9766
South Africa Rand 10.6626

Dollar Index 3 Month Chart INO 80.20 [firming]

http://quotes.ino.com/charting/index.html?s=NYBOT_DX&v=d3&t=c&a=50&w=1

The Bloomberg Dollar Spot Index, which tracks the greenback against 10
major currencies, was set for the highest close in almost two weeks.

Euro versus the Dollar 3 Month Chart INO 1.3764

http://quotes.ino.com/charting/index.html?s=FOREX_EURUSD&v=d3&t=c&a=50&w=1

Dollar Yen 3 Month Chart INO 103.91 [a Trading Buy with a 104 handle]

http://quotes.ino.com/charting/index.html?s=FOREX_USDJPY&v=d3&t=c&a=50&w=1

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Commodity Markets at a Glance WSJ
Commodities


Gold 3 month Chart INO 1291.58 [the 2014 high has been posted]

http://quotes.ino.com/charting/index.html?s=FOREX_XAUUSDO&t=c&a=50&w=1&v=d3

Crude Oil 3 Month Chart INO 99.27 [trades rich see above 100.00]

http://quotes.ino.com/charting/index.html?s=NYMEX_CL.K14.E&v=d3&t=c&a=50&w=1

Emerging Markets

Frontier Markets

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South Africa All Share Bloomberg +5.98% 2014 [Record Highs]
Africa


Dollar versus Rand 3 Month Chart INO 10.6458

http://quotes.ino.com/charting/index.html?s=FOREX_USDZAR&t=c&a=50&w=1&v=d3

Egypt Pound versus The Dollar 3 Month Chart INO 6.9752

http://quotes.ino.com/charting/index.html?s=FOREX_USDEGP&v=d3&t=c&a=50&w=1

Egypt EGX30 Bloomberg +17.75% 2014 [Africa's best in 2014]

http://www.bloomberg.com/quote/CASE:IND

Nigeria All Share Bloomberg -5.80% 2014

http://www.bloomberg.com/quote/NGSEINDX:IND

Ghana Stock Exchange Composite Index Bloomberg +11.27% 2014

http://www.bloomberg.com/quote/GGSECI:IND

The Monetary Policy Committee left the rate at 18 percent, Governor
Kofi Wampah told reporters

http://www.bloomberg.com/news/2014-04-02/ghana-leaves-key-rate-unchanged-at-18-after-emergency-increase.html

"The committee is of the view that the impulses of the recent monetary
policy hike are still working through the system," Wampah said. "The
reserve requirement is meant to achieve quicker results. It's not a
tool we use often."

Ghana is struggling to curb inflation that's surged to a four-year
high, fueled by a currency that lost a fifth of its value against the
dollar last year and has already plunged 12 percent since the
beginning of January.

Policy makers today raised the amount of cash as a proportion of
deposits that commercial lenders must hold in reserves to 11 percent
from 9 percent to help curb liquidity and ease inflation.

The move will probably have more of an immediate effect on the cedi
than raising the policy rate, Yvonne Mhango, an economist at
Renaissance Capital in Johannesburg, said by phone.

"They have still tightened but have opted not to use the policy rate,"
she said. The new requirement "withdraws local currency from the
market. In reducing the supply of the cedi it does help improve the
value of the cedi."

The cedi fell 0.4 percent to 2.7 against the dollar at 2:01 p.m. in Accra.

Growth in West Africa's biggest economy after Nigeria's is expected to
slow to 4.8 percent this year from 5.5 percent in 2013, according to
the International Monetary Fund.

The open question is whether, Ghana is in the cockpit or whether the
markets will simply elbow the Government aside 24-MAR-2014

http://www.rich.co.ke/media/docs/038NSX2403.pdf

Ghana has posted a +11.4 per cent return in 2014 but nearly all of
that has been eroded by the Cedi [Ghana Currency] in free fall.
Ghana's Eurobond has a 9 per cent handle and sentiment has soured so
much, it is entirely feasible that Ghana might print a double digit
yield. Ghana is a near perfect harbinger of what can go wrong when you
front load your recurrent expenditure in the expectation that revenues
are a rising tide. The open question is whether, Ghana is in the
cockpit or whether the markets will simply elbow the Government aside.

Bob Diamond Plans African-Loan Securitization to Lure Investors

http://www.bloomberg.com/news/2014-04-02/bob-diamond-plans-african-loan-securitization-to-lure-investors.html

Securitizing loans will open up one of the fastest-growing regions in
the world to institutional investors and provide capital to businesses
operating there, Diamond, 62, said in an interview in Johannesburg
today.

Atlas Mara will have "a capital markets platform, specialized lending
units and securitization units," Diamond said. "International
investors have already crossed the Rubicon in that they're interested
in Africa. Now it's a question of them getting educated on how they do
it."

BancABC, which Robert Diamond's Atlas Mara Co-Nvest Ltd. (ATMA) agreed
to purchase earlier this week, plans to sell a $150 million bond to
fund its operations across southern Africa.

http://www.bloomberg.com/news/2014-04-02/bancabc-plans-to-sell-150-million-bond-to-fund-african-business.html

Africa Hot spots via Jonathan Foster-Pedley at EAPIS

http://www.twitpic.com/e05ud4

read more


Mombasa was calm but tense on Wednesday. Many businesses shut in the city's flashpoint area of Majengo. Trucks full of armed police patrolled palm-lined streets and surrounding areas.
Kenyan Economy


When Rogo was shot dead in 2012, the killing caused several days of
riots. The same happened when Rogo's protege was killed in almost
identical circumstances in October 2013.

Muslim youths also clashed with police for three days in February
after a man was killed during a police raid on a mosque used by
firebrand preachers in the Majengo area.

Khalid, flanked by Muhuri members, said the government had three days
to "unravel the mystery" of Makaburi's death.

"Failure to (do so means) we shall go to the streets in protest as
allowed under our constitution," he added.

Conclusions

Friday might well prove a Flash Point.

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Total Kenya reports FY 2013 EPS 2.08 hikes FY Dividend 200% Earnings here share -5.00% 2014
Kenyan Economy


Par Value:                  5/-
Closing Price:           23.50
Total Shares Issued:          175028706.00
Market Capitalization:        4,113,174,591
EPS:             2.08
PE:                11.298

FY Earnings through December 2013 versus through December 2012

FY Gross Sales 154.626092b versus 119.788989b +29.082%
FY Net Sales 141.718042b versus 107.450534b
FY Cost of Sales [135.371011b] versus [101.577075b]
FY Gross Profit 6.347031b versus 5.873459b
FY Operating Expenses [4.323842b] versus [4.652729b]
FY Finance Costs [278.695m] versus [1.554715b]
FY Profit before Tax 2.084517b versus [64.301m]
FY Profit after Tax 1.312277b versus [202.142m]
FY Earnings Per Share 2.08 versus [0.32]
Final Dividend 60cents a share +200%

Company Commentary


''significant reduction in financing expenses arising from 5.2b
shillings injected by Total in June 2012''
Sales Volumes +37% to 1,491 KMT 2013
Lower Gross margin of 4.5% in 2013 versus 5.5% in 2012 ''attributable
to OTS sales which have a lower margin''

Conclusions


Strong results which were telegraphed in the 1st Half Earnings Release.
The Dividend has been hiked 200% and is worth 4.936%.

read more


Kenya Shilling versus The Dollar Live ForexPros 86.639
Kenyan Economy


Nairobi All Share Bloomberg +5.2103% 2014

http://www.BLOOMBERG.COM/quote/NSEASI:IND

Nairobi ^NSE20 Bloomberg +1.90% 2014

http://j.mp/ajuMHJ

4,933.56 -26.40 -0.53%

Every Listed Share can be interrogated here

http://www.rich.co.ke/rcdata/nsestocks.php

Ex-Blackwater CEO and former US Navy Seal Erik Prince has deepened
his involvement with Kenya's aviation industry with the acquisition of
a 49 per cent stake in Phoenix Aviation.

http://www.businessdailyafrica.com/Corporate-News/-/539550/2267714/-/wg86y3z/-/index.html

Frontier Service Group Ltd, of which Mr Prince is the chairman,
announced it had invested about $14 million (Sh1.2 billion) in one of
the oldest Kenyan aviation companies in a bid to increase its
footprint in the country.

The Hong Kong-listed company made the announcement on Monday despite
claims by Phoenix Aviation that the deal was yet to be finalised.

"Nothing has been finalised. It's still in a stage of negotiations,"
said Phoenix chairman Bill Parkinson. He refused to shed more light on
the deal.

Kenyan firms top list of Africa's most innovative

http://www.businessdailyafrica.com/Corporate-News/Kenyan-firms-top-list-of-Africa-s-most-innovative/-/539550/2267894/-/ypwu4z/-/index.html

Fast Company, a New York-based global business publication, names
iHub, Sanergy and One Acre Fund as Africa's foremost leaders in
innovation.

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by Aly Khan Satchu (www.rich.co.ke)
 
 
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April 2014
 
 
 
 
 
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