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Russia has warned the US-led coalition fighting in Syria that it will view its aircraft as targets, after a Syrian military plane was shot down.
Law & Politics
The coalition said it had shot down the Syrian Su-22 after it bombed
US-backed fighters in Raqqa province on Sunday.
Russia, Syria's main ally, said it was also halting communications
with the US aimed at preventing air incidents.
Syria condemned America's "flagrant attack", saying it would have
The incident comes at a time when the US-led coalition and the
fighters its supporting on the ground are battling to oust so-called
Islamic State (IS) from its Syrian stronghold of Raqqa.
How has Russia responded?
"Any aircraft, including planes and drones belonging to the
international coalition operating west of the Euphrates river, will be
tracked by Russian anti-aircraft forces in the sky and on the ground
and treated as targets," the Russian defence ministry said.
This has the potential to spiral right out of control.
Iran's first missile attack abroad in over 15 years @AP
Law & Politics
“The Saudis and Americans are especially receivers of this message,”
he said. “Obviously and clearly, some reactionary countries of the
region, especially Saudi Arabia, had announced that they are trying to
bring insecurity into Iran.”
The Zolfaghar missile, unveiled in September 2016, was described at
the time as carrying a cluster warhead and being able to strike as far
as 700 kilometers (435 miles) away.
That puts the missile in range of the forward headquarters of the U.S.
military’s Central Command in Qatar, American bases in the United Arab
Emirates and the U.S. Navy’s 5th Fleet in Bahrain.
The missile also could strike Riyadh, the capital of Saudi Arabia.
While Iran has other ballistic missiles it says can reach longer
distances, Sunday night’s launch appears to mark the longest strike it
has launched abroad. Iran’s last foreign missile strike is believed to
have been carried out in April 2001, targeting an Iranian exile group
New Cold War in the Indian Ocean
Law & Politics
new Cold War is brewing in the Indian Ocean, with an informal alliance
of the United States, India, Australia, Japan on one side and China on
the other. While tensions in the ocean are not yet as pitched as in
the hotly contested South China Sea, the potential for conflict is
unmistakably rising in the high stakes strategic theater.
More than 60% of the world’s oil shipments pass through the Indian
Ocean, largely from the Middle East’s oil fields to China, Japan and
other fuel-importing Asian economies, as does 70% of all container
traffic to and from Asia’s industrialized nations and the rest of the
While traffic across the Atlantic has diminished in recent years and
that which crosses the Pacific is mainly static, trade through the
Indian Ocean is fast growing. Maintaining the security of that trade
and other navigation is the ostensible reason for the annual Malabar
naval exercises between India, Japan and the United States.
For the first time in modern history, China is making its own inroads
into the Indian Ocean region to protect its trade routes and energy
supplies. Although this may appear innocuous on the surface, it is has
put China on what could become a collision course with the US and its
regional allies — hence the new informal, anti-China oriented alliance
in the region.
Strategic ripples are gathering. At Obock in Djibouti, situated on the
Horn of Africa and overlooking the southern gateway to the Red Sea and
the Suez Canal, China has established its first foreign military base,
ostensibly to fight piracy.
Yet the facility is located next to a key US military facility, also
in Djibouti. More importantly, it is also close to other bigger US
bases in the region, including a huge facility at Diego Garcia just
south of the Equator in the Indian Ocean, as well as US installations
in Gulf countries.
China’s main regional rival, India, has always considered the Indian
Ocean as its “own lake” in South Asian sphere of influence. As such,
New Delhi is known to be extremely worried about China’s growing
forays into the region, especially as security officials have observed
Chinese submarine activity uncomfortably close to its Andaman and
In 2001, India created a new Far Eastern Naval Command (FENC) based on
those archipelagos to protect its interests in the region. The plan
for its establishment was reportedly hatched in 1995 after a
closed-door meeting in Washington between India’s then prime minister
P. V. Narasimha Rao and US president Bill Clinton. The plan was
finalized when Clinton visited India in 2000.
As Indian journalist Sudha Ramachandran wrote in Asia Times on October
19, 2005: “FENC will have state-of-the-art naval electronic warfare
systems that can extend as far as Southeast Asia.” FENC is also
India’s first and only joint command that includes the army, the navy
and the air force with two naval bases, 15 ships, four air force and
naval air bases, and two army brigades.
Australia, which controls the strategically situated territories of
Christmas Island and the Cocos (Keeling) Islands, appears equally
concerned about China’s recent emergence in the Indian Ocean.
Australia’s signals intelligence facility on the Cocos closely
monitors movements in the maritime region.
If superpower rivalry between the US and China, or increased tension
between China and India, comes to a head in the Indian Ocean, then
Australia will be well-placed to defend its interests and aid allies.
And then there is France, which does not take part in joint naval
exercises but is a US partner in the North Atlantic Treaty
Organization (NATO). While the least prominent of the regional powers,
because of its possession of small islands scattered across the
maritime region, its exclusive economic zone in the Indian Ocean
measures 2.5 million square kilometers.
Apart from its overseas departments of Mayotte and Réunion, France
controls the huge, non-inhabited island of Kerguelen and nearby Crozet
Archipelago and Ile St Paul et Ile Amsterdam, as well as smaller
uninhabited islands around and east of the African island nation of
There is a satellite tracking facility on Kerguelen and about a
hundred “scientists” based on the Crozet Archipelago and St
Paul-Amsterdam on a rotation basis. The French military also has an
infantry regiment on La Réunion, and the French Foreign Legion is
present on Mayotte to help guard its far-flung regional interests,
many rooted in its past colonial era.
China’s new and highly touted “One Belt One Road” (Obor) initiative,
unveiled in October 2013 to extend the region’s infrastructure and
promote more trade, underlines Beijing’s intention to become a global
power. “The Silk Road Economic Belt” alludes to the old Silk Road,
which in ancient times connected the East and the West along trade
routes from Europe through Central Asia to China.
But given conflicts and political instability in countries along that
route, “the Maritime Silk Road” through the Indian Ocean is bound to
become the more important of the two initiatives.
Not since Zheng He, a Muslim eunuch from China’s southwestern province
of Yunnan, sailed his fleets through the Indian Ocean in the 15th
century — and then explored and mapped the region in a bid to impose
imperial control over trade, win favor with the areas’ peoples, and
extend the empire’s tributary system — has China been as present in
That empire eventually fell with wars at home, and in subsequent
centuries China was not even remotely a naval power. The republic,
which was established in 1912, concentrated mainly on riverine warfare
and was no match for the then Imperial Japanese Navy, which fortified
Tokyo’s occupation of Chinese territories in the 1930s and 1940s.
Until the late 1980s, the navy of the People’s Republic of China, was
also a brown-water force, meaning it did not have the deep water reach
of the US and other naval powers. It was not until the 1990s,
following the fall of the Soviet Union and a shift towards more
assertive foreign and security policies, that China’s leaders looked
past land border disputes and turned their attention towards the
By then, China was also becoming an economic power that needed a
strong military, including a navy, to protect its trade and other
maritime interests. Today, as China’s forays in the Indian Ocean and
countering joint naval exercises show, potential great power battle
lines are forming.
While the situation is still far removed from open confrontation, the
Obor initiative and China’s new military facility at Obock are
threatening to break the calm. And while China is in the Indian Ocean
to stay, the emerging alliance designed to counter that influence may
not for much longer remain informal and hidden behind joint naval
exercises without any officially stated geopolitical purpose.
August 19 2013 I have no doubt that the Indian Ocean is set to regain its glory days
Law & Politics
Professor Felipe Fernández-Armesto explains why ‘The precocity of
theIndian Ocean as a zone of long-range navigation and cultural
exchange is one of the glaring facts of history’, made possible by the
‘reversible escalator’ of the monsoon.’
I have no doubt that the Indian Ocean is set to regain its glory days.
China’s dependence on imported crude oil is increasing and the US’
interestingly is decreasing. I am also certain the Eastern Seaboard of
Africa from Mozambique through Somalia is the last Great Energy Prize
in the c21st. [President Kenyatta probably posed the question to
Vladimir Putin, whether Russia felt it had a role to play in this
Energy Great Game in East Africa]. Therefore, the control of the
Indian Ocean becomes kind of decisive and with control China can be
shut down quite quickly. A Sine qua non of President Barack Obama’s
pivot to Asia is US/NATO Power Projection over the Indian Ocean.
Emerging Market Investors Think The BRICs Are Back
Resurgent growth is reviving one of the past decade’s hottest trades.
Emerging-market investors are again piling into the so-called BRIC
nations -- Brazil, Russia, India and China -- pushing monthly inflows
and stock prices to nearly two-year highs. The bet is that a pickup in
the global economy will fuel demand for the countries’ commodity
exports, drive an expansion of middle-class consumption and help them
shore up fiscal accounts.
Wooed by India’s efforts to streamline regulations, Brazil’s economic
rebound, stabilizing prices for Russian oil exports and China’s
stronger currency, traders are warming to the countries’ higher yields
and better outlook for equities. It’s an abrupt reversal after they
were scorched by a 40 percent drop in the biggest BRIC exchange-traded
fund from the end of 2012 through early 2016 as Brazil lost its
investment grade, Chinese growth slowed from a meteoric pace, Russia’s
oil revenue plummeted and India’s current account deficit swelled.
"Improving fundamentals, attractive valuations, and high yields in a
yield-starved world make emerging markets once again attractive,
including some of the BRICs," Jens Nystedt, a New York-based money
manager at Morgan Stanley Investment Management overseeing $417
billion in assets, wrote in an email.
Non-resident portfolio flows into BRIC nations rose to $166.5 billion
last month, up from $28.3 billion in outflows 12 months prior,
according to data compiled by the Institute of International Finance
and EPFR Global
South Africa's Graft Ombudsman Seeks Changes to Central Bank Role
South Africa’s graft ombudsman has suggested changes to the nation’s
constitution to amend the Reserve Bank’s primary objective of
protecting the value of the currency.
The chairman of parliament’s justice committee should start a process
to change the law’s section 224 that sets out the central bank’s
primary objective, Public Protector Busisiwe Mkhwebane said in a
report handed to reporters in the capital, Pretoria, on Monday. The
proposed amendments remove the reference to the Reserve Bank’s role to
protect the value of the rand, a key element of the regulator’s
Mkhwebane calls for the section to say “the primary object of the
South African Reserve Bank is to promote balanced and sustainable
economic growth in the Republic, while ensuring that the
socio-economic well-being of the citizens are protected.”
The rand extended a decline after the comments, weakening as much as
1.6 percent in Johannesburg on Monday.
“The market doesn’t like the fact that they’re looking at changing the
constitution or the mandate of the Reserve Bank,” Wichard Cilliers, a
trader at TreasuryOne Ltd., said by phone: “There is concern about
institutions being undermined.”
Make your own.
Uganda's central bank lowered its key lending rate to 10.0 percent on Monday from 11.0 percent
Uganda's central bank lowered its key lending rate to 10.0 percent on
Monday from 11.0 percent, saying a stable exchange rate for the
shilling and subdued domestic demand had contributed to an easing of
core inflationary pressures.
Bank of Uganda Governor Emmanuel Tumusiime-Mutebile told a news
conference the economy expanded by 3.9 percent in 2016/17 (July-June),
down from a growth rate of 4.7 percent in the previous year, due to
drought and slow implementation of public investment projects.
Nakumatt yet to pay employees May wages @BD_Africa
Kenya’s largest retail chain Nakumatt’s financial troubles appear to
have deepened last month with cash-flow problems delaying payment of
salaries for more than two weeks.
The supermarket, which runs the highest number of outlets in East
Africa, had by Monday not paid 1,555 employees their May salaries and
had sent more than 100 on compulsory leave, citing low business
The retailer, which has 5,700 employees in Kenya, said a delay in
completing the restructuring of its business – which involves
attracting fresh capital -- has seen it fail to honour this monthly
liability on time, leaving its staff in financial distress.
Some employees told the Business Daily that Nakumatt has also not been
remitting statutory deductions to various agencies such as the
National Hospital Insurance Fund (NHIF) and National Social Security
Fund (NSSF, but the retailer insists they are up to date.
The retail chain, which is awaiting a $75 million (about Sh7.7
billion) cash injection from an unnamed private equity fund, has in
the past three months seen stocks disappear from its shelves as big
suppliers such as Unilever stopped deliveries due to mounting debts.
Its in a death spiral.
West Texas Intermediate Crude Oil for July delivery slumped by a $1.40
to trade $43.25 a barrel on the New York Mercantile Exchange the
lowest since Nov. 14.
Oil has been in a sharp slump since OPEC underwhelmed the market some
4 weeks ago. I expect a further dive and a crisis [of the scale of the
Dick Fuld crisis of 2008] in the oil producing capitals of the World.
The Nairobi All Share eased back -0.23 points to close at 152.74. The
All Share is +14.54% in 2017 and has corrected -0.86% over 2 sessions
and off a 23 month High.
The Nairobi NSE20 rallied a further +17.25 points to close at 3600.01
a Fresh 11 month high.
Equity Turnover spiked big to clock 1.621b.
N.S.E Equities - Commercial & Services
Safaricom ticked -1.09% easier to close at 22.75 and traded 16.454m
shares. Safaricom is in bull mode but near term in a shallow price
Kenya Airways eased -1.709% to close at 5.75 and on good volume of
Uchumi closed unchanged and has been unable to get any forward
traction on the woes of Nakumatt.
N.S.E Equities - Finance & Investment
The Capital Markets Authority [CMA] issued a cautionary announcement
headlined ''ALLEGED PURCHASE/TAKEOVER OF NATIONAL BANK OF KENYA BY KCB
''The attention of the Capital Markets Authority has been drawn to the
continued media reports on possible acquisition of majority shares of
National Bank of Kenya Limited by KCB Group Plc. We wish to clarify
that no regulatory filings have been made to the Authority by KCB
Group regarding this matter and no confirmation of the existence of
such a transaction has been received.
In view of this, members of the public are advised to exercise caution
when dealing with the shares of both KCB Group and National Bank
limited. An appropriate announcement shall be made in the event that
details of such a transaction (if any) are filed with the Authority as
required by the applicable Regulations''
This announcement did not staunch the parabolic rally in National Bank
which rallied a further +3.73% to close at 11.10 and closed the
session trading at limit high +9.81%. National Bank is +64.44% in June
and since the story to which the CMA is referencing, broke.
KCB which had corrected -10.00% through June rebounded +2.77% to close
at 37.00 and traded 3.946m shares.
The NSE rallied +4.67% to close at a 2017 high of 16.80.
N.S.E Equities - Industrial & Allied
EABL closed unchanged at a 2017 high of 260.00 on heavy volume action
of 1.599m shares worth 417.444m but interestingly closed the session
at 267.00 +2.69% an intra day session high for 2017.
Mumias Sugar Company rallied by the daily maximum of +8.33% to close
at a Fresh 2017 high of 1.30. Mumias has rallied an eye popping
+73.33% in June on nothing in particular.
Kengen firmed a further +0.56% to close a Fresh 2017 closing High of
8.85 and traded 2.962m shares. PIC SA mopped up surplus shares and
underwrote the price.