|Monday 29th of October 2018
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The Latest Daily PodCast can be found here on the Front Page of the site
'This is an authoritarian era' - and investors should be worried, says @RichardHaass @CNBC
"This is an authoritarian era, all things being equal. Democracy is in
something of a recession," Haass told CNBC's Hadley Gamble in Paris on
"For 70, 75 years, we've had this rules-based international system, no
great power wars, muted rivalries … and now when I look at the world
and the people running the world, it gives me pause. I'm worried that
when historians look back on this moment, they're going to see this is
the beginning of the unraveling."
Ian Bremmer, founder of risk consultancy firm Eurasia Group, told CNBC
in an earlier interview that the world is entering a "geopolitical
recession" that heralds the end of the U.S.-led global order.
"Transport the Soul" by Brad Goldpaint (USA). Overall Winner and Winner, People and Space. @mymodernmet
Interested in adding a ‘human element’ to his photographs, once the
quarter moon rose and revealed the incredible, vast landscape of the
shale hills below the viewpoint, the lone photographer, to the left of
the frame, stood motionless while he captured this photograph. The
Andromeda Galaxy, quarter moon, Milky Way Galaxy, and position of the
photographer all combined to create a captivating, harmonious portrait
of a night sky photographer at work. Moab, Utah, USA, 20 May 2017.
Nikon D810 camera, 14-mm f/4.0 lens, ISO 2500, 20-second exposure.
"Speeding on the Aurora lane" by Nicolas Lefaudeux (France). Winner, Aurorae @mymodernmet
A hazy, subtle auroral band is leisurely drifting across the sky
providing an unusual perspective with faint bands appearing to radiate
from a vanishing point, like a road disappearing over the horizon. As
the aurora glided overhead, it made the photographer feel like he was
driving a spaceship about to reach light speed toward the Big Dipper.
This view lasted less than a minute. Sirkka, Finland, 30 March 2017.
Sony ILCE-7S2 camera, 20-mm f/1.4 lens, ISO 2000, 3.2-second exposure.
We are all made of stars: half our bodies' atoms 'formed beyond the Milky Way' @guardian
Nearly half of the atoms that make up our bodies may have formed
beyond the Milky Way and travelled to the solar system on
intergalactic winds driven by giant exploding stars, astronomers
“Science is very useful for finding our place in the universe,” said
Daniel Anglés-Alcázar, an astronomer at Northwestern University in
Evanston, Illinois. “In some sense we are extragalactic visitors or
immigrants in what we think of as our galaxy.”
Law & Politics
A leadership struggle in Sri Lanka is the latest skirmish in the
broader battle for influence in South Asia between India and China and
has left the tiny island nation -- already heavily indebted to Beijing
-- in the midst of an escalating constitutional crisis.
Sri Lankan President Maithripala Sirisena unexpectedly dismissed Prime
Minister Ranil Wickremesinghe on Friday and appointed former
strong-man president Mahinda Rajapaksa as his replacement. On Saturday
he suspended parliament until Nov. 16 in a power struggle that’s
brought fresh turmoil to the island nation.
The decision to reappoint Rajapaksa -- who ruled between 2005 and 2015
-- is expected to have regional impact, with his ties to China and
history of borrowing heavily from Beijing to fund infrastructure
projects. The return of Rajapaksa may also dent New Delhi’s influence
in Colombo, given Wickremesinghe’s attempts to re-balance Sri Lanka’s
foreign relations away from China and toward India and Japan.
"China is once again emerging as Colombo’s last hope," said Shailesh
Kumar, Asia director at political risk firm Eurasia Group, who
predicts Rajapaksa will re-open the door to Chinese funding. "This
transition will ensure that China can once again prevail over Sri
Lanka’s economy as they have a friend in the prime minister’s office
-- in contrast to Wickremesinghe."
The developments in Sri Lanka play into broader rivalry between India
and China across the Indian Ocean. Beijing’s potential gains in Sri
Lanka could make up for the perceived loss of Chinese influence in the
tiny archipelago nation of Maldives, where a recent election turfed
former President Abdulla Yameen, who had also moved closer to China at
the expense of relations with India.
'Prepare for war', Xi Jinping tells military region that monitors South China Sea, Taiwan @SCMPNews
Law & Politics
China must ‘take all complex situations into consideration and make
emergency plans accordingly’, Xi says on visit to Southern Theatre
Military region has had to bear a ‘heavy military responsibility’ in
recent years, he says
China’s President Xi Jinping has ordered the military region
responsible for monitoring the South China Sea and Taiwan to assess
the situation it is facing and boost its capabilities so it can handle
The Southern Theatre Command has had to bear a “heavy military
responsibility” in recent years, state broadcaster CCTV quoted him as
saying during an inspection tour made on Thursday as part of his visit
to Guangdong province.
“It’s necessary to strengthen the mission … and concentrate
preparations for fighting a war,” Xi said. “We need to take all
complex situations into consideration and make emergency plans
“We have to step up combat readiness exercises, joint exercises and
confrontational exercises to enhance servicemen’s capabilities and
preparation for war.”
Details of his speech came a day after China’s State Councillor
General and Defence Minister Wei Fenghe said the country would never
give up “one single piece” of its territory and warned that “repeated
challenges” to its sovereignty over Taiwan were extremely dangerous
and would result in military action.
One of the primary missions of the Southern Theatre Command is
overseeing the South China Sea, an area where tensions and military
activity involving China, the US and other powers have been growing
Earlier this month, a Chinese destroyer almost collided with a US
warship in the disputed waters after making what the Americans
described as an “unsafe and unprofessional” manoeuvre in an attempt to
warn it to leave the area.
“The United States is expected to conduct more freedom of navigation
exercises in the South China Sea region, and because it does not
recognise [Beijing’s] rights to artificial islands, like Mischief
Reef, there will probably be more military friction between the two
The Khashoggi Affair and the Future of Saudi Arabia @Consortiumnews
Law & Politics
If the Saudi power structure were to crumble in the wake of the
Khashoggi scandal there would be chaos at home and a shift in power
around the Gulf, says Daniel Lazare.
If Donald Trump seems at a loss about how to respond to the Jamal
Khashoggi murder, it may not be because he’s worried about his Saudi
business investments or any of the other things that Democrats like to
bring up to avoid talking about more serious topics. Rather, it’s
likely because Trump may be facing one of the biggest U.S.
foreign-policy crises since the overthrow of the shah in 1979.
At that time the U.S. counted on support from Arab Gulf states no less
frightened by the Iranian revolution. That included Saddam Hussein’s
Iraq, oil emirates Kuwait and Qatar, plus the Saudis themselves.
But if the Saudi power structure were ever to crumble in the wake of
the Khashoggi scandal, there would likely be chaos because there is no
alternative to replace it. The impact on the region would be
significant. With its 55-percent Shi‘ite majority, Iraq is already in
the Iranian orbit after the U.S. overthrow of Saddam; Qatar and Oman
are on businesslike terms with Tehran, while Kuwait and the UAE could
possibly reach an accommodation with Teheran as well. The upshot would
be an immense power shift in which the Persian Gulf could revert to
being an Iranian lake. That’s probably why the United States and
Israel will do everything in its power to prevent the House of Saud
The consequences in terms of U.S. imperial interests would be nearly
incalculable. For decades, America has used the Gulf to shape and
direct its interests in the larger Eurasian economy. Thanks to
trillions of dollars in military investment, the Saudis control the
spigot through which roughly 24 percent of the world’s daily oil
supply flows, much of it bound for such economic powerhouses as India,
China, South Korea, and Japan. Should control pass to someone else,
America would find its monopoly severely impaired. The effects would
also be felt in Syria, where Israel is incensed by the Iranian
presence. It would be even more so should the Saudi counterweight be
Expert consensus is that the regime is conservative,
consensus-oriented, and stable, and that all the king might have to do
ensure the regime’s survival is to remove his son, Muhammad bin Salman
(MbS), as crown prince.
However, the kingdom may be less stable than it appears. It was
already in trouble when MbS began his rise in early 2015. The second
generation of Al-Saud rulers appeared played out along with their
Adjusted for inflation, oil prices had fallen two-thirds since the
2008 financial crisis while the kingdom was as dependent on oil as
ever despite forty years of lip service to the virtues of
diversification. Corruption was out of control while unemployment
continued to climb because young Saudis prefer to wait years for a
no-show government sinecure instead of taking a private-sector job in
which they might actually have to work. (Studies show that Saudi
government employees put in only an hour’s worth of real labor per
Internationally, the country found itself facing growing headwinds as
Barack Obama firmed up his historic nuclear accord with Iran. Obama’s
statement in April 2016 that Saudis needed to “share” the Middle East
with its arch-rival to the north would come as a blow to a family that
thought it could always count on unqualified U.S. support.
Oil was supposed to keep Saudi Arabia rich and powerful, but instead
total reliance on it was threatening to eventually weaken it.
Something had to be done, and King Salman, although only
intermittently lucid, figured his 29-year-old son was the man. Shoving
rivals aside – most notably cousin Muhammad bin Nayef, the prince in
charge of combatting Al Qaeda – Muhammad bin Salman began grabbing the
reins and issuing orders.
The results have been disastrous. Within weeks of being named minister
of defense — his appointment as crown prince would take a few months
longer — MbS launched an air war on Yemen that would soon turn into a
classic quagmire, one that would cause as many as fifty thousand
combat deaths, propel much of the country to the brink of starvation,
and generate annual costs back home of $50 billion or more that the
kingdom could no longer afford.
In June 2017, bin Salman imposed a quarantine of Qatar on the grounds
of excessive cordiality with Iran and too close relations with the
Muslim Brotherhood, but he was taken aback when the emirate showed
that it could carry on despite the blockade. A few months later, MbS’
henchmen kidnapped Lebanese Prime Minister Saad Hariri and forced him
to read a resignation speech on Saudi TV. But Hariri repudiated the
speech as soon as he was back in Lebanon.
Every attempt to assert Saudi strength only underscored its growing
weakness. Bin Salman rounded up two hundred of the kingdom’s richest
princes and businessmen last November, herded them into the Riyadh
Ritz-Carlton, and then, following beatings and torture, forced them to
hand over $100 billion or more.
Capital flight accelerated as a consequence while foreign direct
investment is now off eighty percent from 2016 levels. The crown
prince unveiled a series of grandiose vanity projects – an
entertainment park twice the size of Disneyworld, a $500-billion robot
city known as Neom, and a tourist park the size of Belgium – but then
had to put them on hold when his father blocked plans to privatize
five percent of Saudi Aramco, which he had been counting on as a
revenue source. He hiked gas prices by eighty percent and slapped on
a five-percent sales tax, but then went on a Marie Antoinette-style
spending spree, shelling out $550 million for a yacht, $450 million
for a painting, and $300 million for a French chateau. Whatever the
benefits of austerity, they were promptly undercut.
Now the torture, murder, and dismemberment of a dissident journalist
in Istanbul has made matters many times worse. With MbS persona non
grata across the globe, the kingdom’s political and economic isolation
is as great as it has probably ever been. According to a report in
the Paris daily Le Figaro, moves have begun to replace MbS as crown
prince, second in line to the throne.
An abundance of princely candidates compounds the confusion caused by
an unclear line of succession. Since Saudi kings have generally
claimed a right to choose their successors, it would be up to Salman
to appoint a replacement. So far, the rest of the family has been too
terrified to say otherwise. But if MbS departs the scene, factions
that suffered under his reign might grow bold enough to demand a say.
Since it is unclear what that would mean in an absolute monarchy, a
royal donnybrook could conceivably ensue.
Other forces might also weigh in. One is the military, which can’t be
too happy now that Maj. Gen. Ahmed al-Assiri, a top intelligence
officer, is being set up as the fall guy in the Khashoggi affair.
Another is the Wahhabiyya, the ultra-conservative mullahs who have
allied themselves with the Al-Saud since the eighteenth-century, only
to see themselves shunted aside by a headstrong crown prince. MbS
seemed to go out of his way in recent months to stick it to the
mullahs. “No one can define Wahhabism,” he said in an interview last
spring. “There is no Wahhabism. We don’t believe we have Wahhabism.”
Those are words that mullahs are not likely to forget, which is why
they will probably speak out if the question of a new crown prince is
Then there is the threat of ISIS and Al Qaeda. After accusing Saudi
Arabia of “trying to secularize its inhabitants and ultimately destroy
Islam,” Abu Bakr al-Baghdadi, Islamic State’s self-proclaimed caliph,
launched an attack inside the kingdom in July that killed two people.
Al Qaeda, which also portrays itself as defender of the true Wahhabist
faith, has launched a similar campaign. Hamza bin Laden, Osama’s son,
has released six videos denouncing the royal family as “agents of the
Americans,” and called on “honest, glorious scholars … [to]
participate in promoting change with their tongues, their pens, their
media, and their tweets,” and urging “youth and those capable of
fighting” to join the “mujahideen in Yemen.”
Jihad abroad is a habit the Al-Saud can’t kick. Since MbS launched his
ill-fated war on Yemen, Al-Qaeda’s forces in that country have
mushroomed from near zero to an estimated four thousand fighters.
While its strength inside Saudi Arabia is unknown, there is no
question that the group continues to enjoy significant support.
According to a 2015 poll of Saudis between the ages of fifteen and
thirty-four, 28 percent say that groups like ISIS or Al Qaeda “are
mostly wrong, but sometimes raise issues I agree with,” five percent
say “they are mostly right, but I disagree with some of their words
and actions,” while ten percent say that “they are not a perversion at
all.” Sympathy for such forces will likely grow as disorder mounts.
Disaffected royals thus demand political change along with angry
mullahs, obsessed jihadis, and millions of jobless young people. By
flooding Saudi Arabia with oil revenue and high-tech armaments and
allowing it to attack whomever it pleases, the U.S. has contributed to
an increasingly dangerous build-up of highly combustible forces.
Liberals may hope that a constitutional monarchy emerges out of the
current mess, but it’s unlikely in the extreme. The Saudi crisis is
likely instead to intensify.
A 32-year-old wannabe king
Law & Politics
The then 30-year-old crown prince of Saudi Arabia Mohamed bin Salman
MBS, arrived on the scene and immediately launched an unwinnable war
in Yemen. President Assad, with his Russian, Iranian and Lebanese
allies, resisted the regime changers in Syria. IS, which was a Sunni
and Saudi blade, has been eviscerated. Iraq, which was once firmly in
the Saudi camp, is now aligned with Iran completely. Qatar is lost
(see the intercept article which refers to a plan headlined “Control
the yield curve, decide the future” a plan to construct the ‘’Big
Short’’ on Qatar - The crown prince of Abu Dhabi should have spoken to
me because I could have told them how to do it).
Saudi Arabia and its allies UAE, Bahrain, Kuwait are caught in an ever
tightening Shia pincer. The paranoia in the palaces in Saudi Arabia is
real and existential. And what is also clear is that Bibi Netanyahu,
MBS [the crown prince of Abu Dhabi], Jared Kushner and a Trump carte
blanche have all leveraged this existential paranoia to effect not a
state capture but a kingdom capture.
The existential paranoia in the head of 32-year-old wannabe King is
evidenced in this comment about Iran in May this year, “How can I
communicate with them while they prepare for the arrival of al-Mahdi
Last week after being coached into the early hours by Ivanka Trump’s
husband, Jared Kushner, MBS launched his night of the long knives,
which, according to the veteran Journalist Robert Fisk, and I quote:
‘’When Saad Hariri’s jet touched down at Riyadh on the evening of 3
November, the first thing he saw was a group of Saudi policemen
surrounding the plane. When they came aboard, they confiscated his
mobile phone and those of his bodyguards. Thus was Lebanon’s prime
minister silenced’’ Hours later, MBS’s newly minted Anti-Corruption
commission detained 11 House of Saud princes, four current ministers
and dozens of former princes/cabinet secretaries – all charged with
corruption. Bank accounts were frozen [We could witness a massive $1
trillion dollar disgorge right here], private jets grounded. The
high-profile Princely crew is jailed at the Riyadh Ritz-Carlton and
the gates are now shut, the phone line is perpetually busy and you
can’t book a room until Feb. 1. Fisk concludes ‘’Put bluntly, he is
clawing down all his rivals.’’
In all the history books I have read, its probably wisest to operate
on one front not two and certainly not three.
Crown Prince Mohammad bin Salman's agents attacked me outside @Harrods , says activist Ghanem al-Dosari @thetimes
Law & Politics
Scotland Yard has begun a high-level investigation after a Saudi human
rights activist was attacked in a London street by two men accused of
being agents for Crown Prince Mohammad bin Salman’s regime.
Footage of the assault was published shortly afterwards on social
media channels linked to the Saudi government.
The dissident, Ghanem al-Dosari, said the men had followed him and a
friend, Alan Bender, from a cafe where they were having coffee and
attacked him in Brompton Road, opposite Harrods.
“They came behind us and they came at me, saying who am I to talk
about the Saudi royal family,” he said. “They punched me three times.”
Al-Dosari, who operates a YouTube channel mocking the Saudi regime,
has a large following in the Middle East. He has received death
threats in the past, including a threatening phone call, which he
taped and published.
“My friend [Bender] tried to stand in between them and said, ‘This is
London, not Saudi,’” al-Dosari said. “They said, ‘F*** London — the
Queen is our slave,’ and told him, ‘Get out of here — we’re not here
for you.’ It was a targeted attack. I have no doubt they were agents
of the state.”
Museveni widens the tent @africa_conf
Law & Politics
President Yoweri Museveni is to appoint former members of the
opposition as ministers, according to a leak of a cabinet list. The
President means to divide the opposition and repair the damage to his
reputation caused by the Bobi Wine protests and defuse them, Kampala
pundits are saying.
Presidential praise-singers Why @realDonaldTrump is popular in Africa @TheEconomist
Donald trump has never set foot in Africa. And he has seldom been
polite about the continent either, allegedly dismissing Nigerians as
hut-dwellers and African states as “shitholes”. Yet he is more popular
in Africa than in any other region, according to a 25-nation survey by
Pew, a pollster. Some 59% of Nigerians and 56% of Kenyans believe he
is a positive influence on world affairs. South Africans are less
keen: only 39% express confidence in Mr Trump. But that is still 12
percentage points higher than the global median (see chart).
Yet perhaps there is more to it than that. “As an African, there’s
just something familiar about Trump that makes me feel at home,” said
Trevor Noah, a South African comedian, in 2015. He noted that Mr
Trump’s boasts about his wealth, power and brains are similar to those
of the late Ugandan dictator, Idi Amin. Others agree that Mr Trump’s
style grates less on a continent that is used to bombastic presidents.
“Somali parents like to name their sons after powerful men,” says
Saddam Hussein Adani, a logistician from Mogadishu. “If Trump were a
Muslim, I’m sure you would have a few baby Donalds today.”
In the pubs of Mai Mahiu, a settlement in Kenya’s Rift Valley, daytime
drinkers praise Mr Trump for being tough enough to stand up to China.
Kenyans prefer an American-led world to one dominated by China by a
ratio of two to one.
At this rate, ignoring the question of income distribution and differentiation between economies, SSA's GDP per-capita would take until the late 2060s to double. @Africa_Conf
Although the International Monetary Fund and the World Bank maintain
that Africa's economies will, on average, expand faster during 2018
than last year, both Washington DC institutions have downgraded their
growth forecasts. While the IMF and the World Bank respectively
predicted overall sub-Saharan Africa (SSA) real GDP growth of 3.4% and
3.1% at their April meetings, at this month's annual meetings in Bali,
Indonesia, they downgraded their predictions for the region to 3.1%
and 2.7%. That works out at less than one percentage point in
per-capita terms at a time when the IMF's African Department director
Abebe Selassie has warned that hoped-for future per-capita growth of
approximately 1.5% through the early 2020s is much too low for
Africa's needs. At this rate, ignoring the question of income
distribution and differentiation between economies, SSA's GDP
per-capita would take until the late 2060s to double.
.@IMFNews Wants Assurances on Debt Restructuring Before Congo Bailout @business
The International Monetary Fund said it wants assurances from the
Republic of Congo’s creditors about how the nation’s debt will be
restructured before it considers a bailout.
The debt-laden country has been trying to secure a bailout since last
year from the IMF, which has asked the government to curb rampant
corruption and divulge the assets of high-level officials before
providing any support. Oil-producing Congo’s economy has contracted
for the past two years and it owes creditors at least 5.31 trillion
CFA francs ($9.2 billion).
The IMF repeatedly rescheduled board meetings to discuss the package
in recent months, without saying why. It reached an agreement with the
government in April on a program to stabilize government finances.
Congo’s debt-to-gross domestic product ratio is about 110 percent,
well above the 70 percent threshold allowed by the Economic and
Monetary Community of Central Africa, according to a February report
by the French Embassy in Congo that cited the Finance Ministry’s
Congolese Sinking Fund. Congo is one of six country’s in Cemac.
Congo’s creditors, which include Glencore Plc and Trafigura Beheer NV,
are owed 1.2 trillion CFA francs, according to the embassy report,
which was published on the Congolese prime minister’s website. The
nation’s external debt to China is estimated at 1.6 trillion CFA
francs, it said.
Push-ups and makeovers @Africa_Conf
Even when faced with an attempted coup d’état, Prime Minister Abiy
somehow turned it into a public relations triumph.
After disgruntled – and fully armed – troops marched into Prime
Minister Abiy Ahmed's office in central Addis Ababa on 11 October,
initial reports unconvincingly suggested the head of government had
simply discussed pay with the 250 or so men. Himself a former
Lieutenant Colonel, the Prime Minister did some push-ups with the
assembled men, and the image of beaming commandos with their athletic
commander-in-chief was duly splashed across the globe in the manner of
a typical photo-op.
Monday, July 2, 2018 These 90 or so days represent the most consequential arrival of an African politician on the African stage since Mandela walked out of prison blinking in the sunlight
Paul Virilio terms it ‘dromology’, which he defined as the “science
(or logic) of speed“. He notes that the speed at which something
happens may change its essential nature, and that which moves with
speed quickly comes to dominate that which is slower.
“Whoever controls the territory possesses it. Possession of territory
is not primarily about laws and contracts, but first and foremost a
matter of movement and circulation.”
Virilio argues that the traditional feudal fortified city disappeared
because of the increasing sophistication of weapons and possibilities
for warfare. For Virilio, the concept of siege warfare became rather a
war of movement.
Abiy Ahmed has moved at lightning speed, the old guard is like ‘’the
traditional feudal fortified city’’.
He said “The ppl of Tigray are still begging for a drop of water; TPLF
(the party) is not the people of Tigray”.
former FINMIN @mgigaba said on Sunday a private sex video was leaked after his phone was hacked and he had faced blackmail threats over it when he headed the Treasury @ReutersAfrica
“My wife and I have learned, with regret and sadness, that a video
containing material of a sexual nature, meant for our eyes only, which
was stolen when my communication got illegally intercepted/my phone
got hacked, in 2016/17, is circulating among certain political
figures,” Gigaba said on Twitter.
“This video has been at the centre of a number of blackmail and
extortion attempts, dating back to the period immediately following my
appointment as Minister of Finance, on 31 March 2017, all of which I
have steadfastly refused to entertain,” he said on his official
NIGERIA Now the race looks serious @Africa_Conf
The challenger Atiku Abubakar has built a new coalition, but strong
northern support for President Buhari will give him staying power
Hell froze over in Nigeria on 11 October. That's when former President
Olusegun Obasanjo endorsed his once Vice-President and newly crowned
leader of the opposition People's Democratic Party (PDP), Atiku
Abubakar. It showed how determined both men, for differing reasons,
are to drive President Muhammadu Buhari from power in next February's
The two titans had been mortal enemies since 2003, when Obasanjo used
the powers of the presidency to dismember Atiku's network and thwart
his ambition of getting the top job. Given the dominance of patronage
networks across the country, these feuds have come to dominate
politics as much as, or more than, ethnicity or religion.
More influential still is cash. Street wisdom explains this
plutocratic competition as 'government of the greedy, by the greedy,
for the greedy', in an economy fuelled by government contracts
diverted through the patronage networks.
UK's SFO says ex-Afren executives convicted of fraud, money laundering
Two former executives of collapsed oil firm Afren were convicted on
Wednesday of fraud and money laundering offences relating to a $300
million business deal, the UK’s Serious Fraud Office (SFO) said.
Former Afren Chief Executive Osman Shahenshah and former Chief
Operating Officer Shahid Ullah received more than $17 million and
laundered $45 million, some of which was used to buy luxury properties
in Mustique and the British Virgin Islands, it said here
Shahenshah and Ullah created shell companies and agreed a side deal
with one of Afren’s Nigerian oil partners from which they would
benefit, without the knowledge of Afren’s board, the SFO added.
“Instead of acting in their company’s best interests, they used Afren
like a personal bank account to fund an illicit deal, with no regard
for the consequences,” Lisa Osofsky, Director of the SFO, said in a
New Kenya-US route expected to boost trade by 25pc @The_EastAfrican
According to trade statistics from the US Census Bureau, aggregate
trade between US and Kenya in 2017 amounted to Ksh102.2 billion ($1
billion), with US exports to Kenya totalling Ksh57.2 billion ($572
million) while Kenya’s exports to the US amounted to Ksh45 billion
With the Nairobi-New York direct flights, the flow of goods and
services between the two countries is expected to increase by nearly
25 per cent per year.
More importantly, Kenya has the opportunity to increase access of its
goods to the American market and reap the benefits of African Growth
Opportunity Act, which accords duty-free exports for selected
@IMFNews -> The @CBKKenya's FX Operations are spectacularly successful
-> Limiting speculation -> allowing real FX business -> I just don't
get why they the @IMFNews fail to see this.
29-OCT-2018 :: @KenGenKenya's Moment of Glory
I attended the much anticipated Full Year Earnings Release at the
InterContinental on Friday. This was the second set of results
delivered by the Chief Executive Officer Rebecca Miano and against a
backdrop of what has been an ''annus horribilis'' for the Energy
Sector. Rebecca's and KenGen's Power of Pull was evidenced by the Full
House and the fact that practically every Energy Stakeholder was in
The CS Water Simon Chelogoi said ''I felt it is important to celebrate
a Kenya Inc success story''
'If there are any organisations of which we are very proud of without
any controversy it is Kengen'' said CAS Dhadho
''We remained resilient in turbulent waters'' said Rebecca in her
opening remarks and ‘’Our Message today is KenGen has produced good
results and a dividend and the best is yet to come''
Let me lay out the Earnings. Full Year Revenue clocked a +4.278% gain
to register 45.290b, [Steam Revenue was the Outlier at 6.222b
+19.907%]. Electricity revenue from geothermal power plants increased
by 6% from Ksh16.1Bn in the previous year to Ksh17.1bn. KenGen's
expansion has been predominantly a Geothermal one and there is plenty
more of this resource to tap. You might not have noticed that
notwithstanding one of the worst droughts in recent memory, KenGen's
supply to the Grid was hardly interrupted last FY largely because of
the Geothermal strategy. Full Year Profit Before Tax firmed +2.487%
to register 11.746b, FY Profit after Tax was -12.381% [because of a
+57.026% pop higher in Income Tax due to the fact the prior year’s tax
expense was lower largely due to effect of the tax incentive
(investment deduction) granted on commissioning of new geothermal
wellhead plants] and FY Earnings Per Share was 1.20. KenGen snapped a
Dividend drought and are paying 40cents a share which is a 33% Pay Out
Ratio which represents a 5.369% yield versus the closing price on
Friday [The share price closed at 7.45 +1.36%]. The Dividend Payment
of 2.8b shillings was important and a muscular signal and will
underpin the share price. Other noteworthy points are a +150.638%
surge in FY Finance Income which clocked 3.341b which informs me that
KenGen's Treasury operations are now much more effective and that they
are able to leverage what is a seriously low average cost of Funds
89% of KenGen's output is renewable which is truly remarkable. The
''Green'' Economy has a Champion in Kenya and it is KenGen.
Now we are all aware of the travails at Kenya Power and it really
behoves KPLC to carpe the diem and find their Lee Iacocca Figure who
can turn it around. This Parastatal ''termite Economy'' is on its last
legs. It is a material issue for KenGen.
What interested me was the growth outlook that Rebecca spoke to.
Obviously the electrification of the SGR [Why it was Diesel at the
Get-Go remains a mystery to me and a question that I cannot answer]
would be a big boost to Demand. Furthermore, there is also a big
regional expansion Opportunity on the Horizon as well.
"We're looking into regional expansion, with the power transmission
lines including 1,100km (Kenya-Ethiopia) 127km (Kenya-Uganda) 94km
(Kenya-Tanzania) and 400kv planned transmission." The Demand Curve
which has been running at an average +5% CAGR since 2011 could steepen
dramatically. KenGen has a big role to play in industrialising the
Kenyan Economy. Our Per Capita Electricity consumption is 200 kWh just
1/10th of what it could be. Energy is a very important component of
the leapfrog into an industrialised future. What is clear is that
KenGen is playing its role, is ahead of the curve and its Peers and
its execution is also noteworthy.
The PE Ratio has a 6 handle. Ending the dividend drought and these
results leave plenty of scope to the Upside.