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Thursday 16th of February 2017 |
Morning Africa |
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If you are tracking the NSE Do it via RICHLIVE and use Mozilla Firefox as your Browser. 0930-1500 KENYA TIME Normal Board - The Whole shebang Prompt Board Next day settlement Expert Board All you need re an Individual stock.
The Latest Daily PodCast can be found here on the Front Page of the site http://www.rich.co.ke
It was good to catch up with H.E John Mahama last night before his departure. Such an elegant Fellow.
I thank The Governor of the Central Bank Dr. Patrick Njoroge for the time this morning |
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Satellite TV Is Fueling Zimbabwe's Cash Shortage: Central Bank Africa |
Zimbabwe’s central bank said it is “illogical” and undermining efforts to stem a cash shortage that the country is spending more on satellite television subscriptions than on imports of the raw materials needed to produce cooking oil.
Zimbabwe is facing its worst economic crisis since 2008 as a liquidity squeeze has left companies unable to pay foreign suppliers and workers in cash. The economy probably shrank 0.3 percent last year and is set to contract 2.5 percent his year, according to the International Monetary Fund.
Financial institutions used $207 million for the payment of satellite television subscriptions during the last six months of 2016 through accounts held in offshore currencies, the largest allotment of foreign exchange after fuel in the period, the Reserve Bank of Zimbabwe said in its monetary policy statement on Wednesday.
“Use of hard-earned foreign currency in this manner is not sustainable,” the central bank said. Banks should “exercise discipline and rationality in the distribution of foreign exchange among the competing needs of the economy.”
Total foreign currency receipts fell 14 percent to $5.4 billion in 2016, while export proceeds shrank 13 percent to $2.96 billion, the bank said. Remittances from Zimbabweans living abroad slumped 18 percent to $1.57 billion.
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South Africa watchdog seeks penalty against banks for FX rigging Africa |
South Africa's competition watchdog has recommended a fine equal to 10 percent of annual turnover for several banks, including Citigroup, Nomura and Standard Bank, for rigging the rand currency, it said on Wednesday.
The Competition Commission said it had concluded an investigation into whether banks colluded by using an instant messaging chat room called "ZAR Domination", to coordinate their trading activities when giving quotes to customers who buy or sell currencies.
ZAR is the code for the South African rand used in financial markets.
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Ailing President Abroad Leaves Nigeria With Sense of Deja Vu Africa |
A president who’s flown abroad to seek medical treatment and given no firm date for his return: Nigeria has been here before.
Muhammadu Buhari, 74, traveled to the U.K. on Jan. 19 for medical tests and was due back on Feb. 5. He’s yet to return and hasn’t appeared or spoken in public for more than three weeks after asking lawmakers for medical leave. On Monday, he talked by phone with U.S. President Donald Trump, giving cheer to his supporters that he’s not as ill as widely speculated. Yet his absence is heightening concern about government paralysis at a time when the economy is in recession and the stock market is sliding.
For many Nigerians the situation recalls former President Umaru Musa Yar’Adua’s time in office. Like Buhari, Yar’Adua was a northern Muslim with a southern Christian vice president in a country with often sharp sectarian divisions.
Yar’Adua was flown in November 2009 to Saudi Arabia for treatment of a heart condition. It took about three months for the legislature to appoint then-Vice President Goodluck Jonathan acting president, as Yar’Adua associates sought to cover up the severity of his condition. Yar’Adua eventually died in office on May 5, 2010. Unlike Yar’Adua, Buhari formally transferred power to his vice president, Yemi Osinbajo, before departing.
“The experience of 2010 still hangs over Nigeria,” Antony Goldman, head of London-based PM Consulting, said by phone from London. “Partly as a result of that the government has undertaken all the efforts to do what wasn’t done in 2010.”
Under the constitution, if Buhari can’t continue in office, Osinbajo would become president and he would choose a new deputy.
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Tale of Two Currencies: A Devaluation Sets Apart Egypt, Nigeria Africa |
Back in early November, Egypt and Nigeria were in the same situation, crying out for dollars to revive their sinking economies and trying to curb rampant currency-trading on the black market.
Egypt’s tactic was to ditch a currency peg, leaving its pound open to market forces. The move helped secure a $12 billion International Monetary Fund loan for Africa’s third-biggest economy. This week, Managing Director Christine Lagarde praised the government for restoring “economic sanity.” Egypt is still short of dollars, but the situation is changing, and investors are gradually returning.
Nigeria, in contrast, isn’t letting the naira trade at its market value, insisting that’s the only way to protect the poor from a 15-month surge in inflation. Traders argue it’s left the currency overvalued and say they’ll avoid Nigerian local markets until it weakens. While the government managed to issue a $1 billion Eurobond last week, its first in almost four years, it is struggling to raise money from the likes of the World Bank, which first wants to see a more flexible exchange-rate in place.
Conclusions
The Outcome is predicted and predictable in Nigeria - The open question is timing.
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Foreign Investment in Ethiopia Slumps After Business Attacks Africa |
Foreign direct investment in Ethiopia dropped by a fifth in the first half of the country’s fiscal year after violent anti-government protests in which foreign-owned businesses were targeted.
The country attracted $1.2 billion in the six months through the end of December, compared with $1.5 billion in the same period a year earlier, Fitsum Arega, commissioner of the Ethiopian Investment Commission, said in a phone interview Monday from the capital, Addis Ababa. He said the government may miss its annual target of $3.5 billion, with $3.2 billion more likely to be attainable.
The government of Ethiopia declared a state of emergency in October to deal with unrest accompanying protests by ethnic Oromo and Amhara communities that began in late 2015 over the alleged dispossession of their land, political marginalization and state repression. Businesses including those owned by Nigerian billionaire Aliko Dangote and Dutch fruit processors were attacked during the unrest. The security forces killed at least 600 demonstrators, according to the Association for Human Rights in Ethiopia.
Ethiopia, one of Africa’s fastest-growing economies, is expected to expand 7.5 percent this year, compared with an average of 9.1 percent over the past five years, according to the International Monetary Fund.
The government is paying out damages to foreign and domestic companies deemed affected by the unrest, with 100 million birr ($4.4 million) already disbursed and “more in progress,” Fitsum said. Claims were received from at least 20 domestic companies. At least two foreign businesses were successful in making claims from insurance companies, while the government is also providing tax relief to operations that sustained damages during the violence, he said. While no foreign investors canceled planned projects, they have taken a “wait-and-see attitude” to the country, Fitsum said.
“We already have big investors in the pipeline,” Fitsum said. “There are also big textile-manufacturing companies we can expect to have in the coming six months,” he said, referring to Ethiopia’s Hawasa Industrial Park that opened in July and which the government says is the largest in Africa.
Conclusions
Holding up [-20% Year on Year] is not a bad outcome in the circumstances.
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17 OCT 16 :: Ethiopia's Reputation Shattered by Political Tensions @TheStarKenya Africa |
I recall reading e Emperor by Ryszard Kapuściński and in that book Kapuściński recounts the tale of Lulu, Haile Selassie’s lap dog that was allowed to piss on the shoes of dignitaries, and the courtier whose job for 10 years was to wipe those shoes clean with a satin cloth. That book also speaks to how the cushion bearer [ The Emperor was very short and therefore had to perched on cushions so as not to be beneath his subjects] became an all-powerful figure at the Imperial Court. Kapuściński was subsequently trashed for his poetic licence in his reportage but I accept his mea culpa:
“You don’t understand a thing. I’m not writing so the details add up – the point is the essence of the matter.”
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Imperial buys stake in Kenyan pharmaceutical distributor Kenyan Economy |
South African logistics group Imperial Holdings will buy a 70% stake in Kenyan pharmaceutical distributor Surgipharm for R456 million ($35 million) in line with its African growth strategy, the company said on Wednesday.
Surgipharm, which is headquartered in Nairobi, is a leading distributor of pharmaceutical, medical, surgical and allied supplies in Kenya, with an annual turnover of about $70 million, the company said in a statement.
It gave no further details.
Conclusions
Transactions have picked up clock speed.
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The 11 listed Kenyan banks dropped an average of 14 percent in January Kenyan Economy |
“The rate-cap legislation has been a massive own goal in terms of stimulating growth,” Razia Khan, head of Africa macro research at Standard Chartered Plc in London, said by phone. “The near-term outlook for bank returns is not very positive at all. What’s happening is draconian, but it’s unlikely there will be changes before the August elections. ”
Kenyan President Uhuru Kenyatta approved the caps, against the advice of the country’s central bank and the Treasury, to fulfill a campaign pledge he made before coming to power in 2013 that he’d lower the cost of loans. It’s failed to rejuvenate private-sector credit growth, which slowed to a 16-month low of 4.3 percent in December from 18 percent a year earlier. The 56-year-old leader will seek a second term in this year’s vote.
The cap was a “highly politicized decision,” said Robert Besseling, an executive director at Exx Africa in Johannesburg. In addition to that law, Kenya is now contemplating restrictions on commercial-bank deposits by state-owned companies to improve the government’s cash management.
“The bigger banks believe they will benefit from a flight to quality as the sector undergoes these fundamental changes. There is always concern that the smaller banks will face difficulties.”
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World's Biggest Tea Exporter Seeks to Double Sales to Russia Kenyan Economy |
Kenya, the world’s biggest black tea exporter, plans to double annual shipments to Russia to 44 million kilograms within three years, according to its Agriculture and Food Authority.
Russia bought more than 152 million kilograms of tea last year. Kenya provided 18 million kilograms of that, almost a fifth lower than 2015 sales. About 1 million kilograms of the exports was orthodox tea.
“We are putting in place strategies for all our main markets,” said Samuel Ogola, the interim head of Kenya’s tea directorate. “Russia has been one of our major export markets and one of the world’s largest importer of tea, but the values have been going down in the past few years.”
Orthodox, which is popular in Russia, Iran and Western Europe, is a specialty product made from black tea that’s processed by traditional methods of withering, rolling and oxidization, while regular black tea is manufactured through machines that crush, tear and curl the leaves.
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N.S.E Today |
The MSCI All-Country World Index hit a record. World equities have gained about $6tn since Trump's election equal to the combined GDP of Germany & UK The US Dow Jones has also closed at a fresh life-time high. Ghana +7.07% in 2017 and South Africa +3.62% are outperforming. The Rand has had a real muscular start to 2017 and is at 7 month highs versus the Dollar as Investors start to view President Zuma and his rogue brand of policy-making to have been triangulated by Pravin Gordhan and others. The South African logistics group Imperial Holdings will buy a 70% stake in a Kenyan pharmaceutical distributor Surgipharm for R456 million ($35 million) in line with its African growth strategy, Surgipharm, which is headquartered in Nairobi, is a leading distributor of pharmaceutical, medical, surgical and allied supplies in Kenya, with an annual turnover of about $70 million, the company said in a statement. The Mergers and Acquisitions pipeline is juiced at the moment [Sadolin Paints and Java refer] which is an interesting development in an election year. The Nairobi All Share closed +0.42 points at 125.33. The All Share is +3.35% in February after a January swoon. The Nairobi NSE20 Index rallied +19.16 points to close at 2971.50 and is also in recovery mode this month I actually believe that the Low for the Year was seen in January
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N.S.E Equities - Commercial & Services |
Safaricom eased -0.27% to close at 18.20 and traded 4.696m shares. There is serious Buy Side Interest at 18.00.
Nation Media rebounded +5.55% to close at 85.50. Nation Media has narrowed its YTLoss to -8.06%. Nation Media recently pronounced it was seeking to position itself as a fully ''digital'' Company.
TPS Serena Hotels was up ticked +2.3% to close at 20.00 and traded 100 shares.
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N.S.E Equities - Finance & Investment |
The Banks came under strong selling pressure in January as Investors fretted about the Interest rate Bill. Banks remain the softest component at the NSE in 2017 and have been since the Bill was passed into Law. Equity Group firmed +0.93% to close at 27.00 and traded 3.735m shares worth 101.015m. Equity is -10.00% Year To Date. Stanbic Bank rallied +3.08% to close at 67.00 and traded 1.004m shares. Stanbic Bank is -6.38% in 2017. Good sized volume has been traded in this counter in 2017.
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N.S.E Equities - Industrial & Allied |
Mumias Sugar [has badly lagged a world-wide Sugar Futures rally which saw Sugar rise just under 10% in January] rallied +4.76% to close at 1.10.
ARM Cement closed unchanged at 19.25 and traded a large ticket of 10.156m shares worth 195.523m. ARM has retreated --24.50% in 2017 and recall CDC Africa Cement became a material shareholder in October last year.
EABL closed unchanged at 225.00 and traded 338,700 shares worth 76.443m.
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