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Tuesday 05th of March 2019
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Morning Africa |
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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 |
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Look Inside Damien Hirst's $100,000-per-Night Suite in @Palms Las Vegas @luxury Africa |
Designed by artist Damien Hirst in conjunction with the architecture
firm Bentel & Bentel, the two-story space features six of Hirst’s
original artworks, along with 9,000 square feet of Hirst-designed
decoration. “You really feel Damien’s design and art through the
entire suite,” says Lorenzo Fertitta, the vice chairman and director
of Red Rock Resorts, which owns the majority of the company that
bought the Palms in 2016. “He created a work of art with the entire
floor.”
Even if the art experience might be ephemeral, visitors to the suite
might feel the impact on their wallets for years. The suite will be
given free to high rollers who have $1 million or more as a line of
credit at the Palms. Alternately, for those who’d prefer to pay cash,
a two night stay will cost a staggering $200,000.
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Moon Jae-in Law & Politics |
Moon Jae-in 문재인 @moonriver365 praises North Korea’s offer to
dismantle a key nuclear production complex as an “irreversible” step
to undercut its weapons program @business
https://bloom.bg/2SDuib7
South Korean President Moon Jae-in praised North Korea’s offer to
dismantle a key nuclear production complex as an “irreversible” step
to undercut its weapons program, breaking with the Trump
administration.
In a meeting to discuss the summit last week in Hanoi between Donald
Trump and Kim Jong Un, Moon on Monday lauded North Korea’s offer to
dismantle the Yongbyon nuclear complex. He also called for pushing
ahead with inter-Korean projects currently hindered by sanctions and
said the two sides discussed the “partial” lifting of sanctions --
backing North Korea’s version of events.
“It would represent an irreversible stage in North Korea’s
denuclearization if the Yongbyon nuclear complex including its
plutonium reprocessing facilities and uramium enrichment facilities
are completely dismantled,” Moon told senior aides Monday at a
National Security Council meeting discussing the summit.
Trump and Secretary of State Michael Pompeo said they couldn’t accept
the proposal from North Korea to shut down the Yongbyon complex in
return for complete sanctions relief because the regime still had
hidden production facilities and missiles elsewhere that could
threaten the U.S.
“That facility, while very big, it wasn’t enough to do what we were
doing,” Trump said last week in Hanoi, referring to Yongbyon.
Conclusions
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04-MAR-2019 :: The Week that was Trump, Kim, Michael Cohen Indo-Pak, Tea and The Shilling Law & Politics |
The World is just so fluid and fast moving and in fact the velocity
makes me plain dizzy. Lets start with what CNN's Stephen Collinson
headlined Trump's Hanoi Hail Mary failed to score. This was of course
the big Set Piece in Hanoi. Before Trump walked away, Trump and Kim
did manage to dine together and partook of Shrimp Cocktail, Chilled
shrimp, romaine leaves, thousand island dressing, diced avocado, fresh
lemon and herbs, Grilled Sirloin with Pear Kimchi Marinated tender
sirloin grilled with sauce, served with kimchi fermented inside a
pear. Dessert was a Hot runny centered chocolate cake, chocolate
crumble, with fresh berries and vanilla ice cream all washed down with
Dried Persimmon Punch. The Gastronomy of these Big Set-Piece
Geopolitical Events is unputdownable as are the Optics.
I am sure Nicholas Maduro must be asking himself, what did it take to
get Chairman Kim a seat at Trump's dinner table. And the Point is
this, it took nuclear Weapons. And the Choice is binary, Dinner
''Grilled Sirloin with Pear Kimchi Marinated tender sirloin grilled
with sauce, served with kimchi fermented inside a pear'' or death ask
Muammar and Saddam.
Kim was surely counting on President Trump being a soft touch because
after all at the very moment they were sitting down for a chat,
Michael Cohen [The erstwhile Consiglieri] was opening with the
following in front of the House Oversight Committee
“He is a racist. He is a con man. He is a cheat,” Cohen said in
testimony that outlined everything from Trump’s alleged involvement in
hush money payments to porn actress Stormy Daniels to his purported
knowledge of Roger Stone’s communications with WikiLeaks. The
President was at risk of being seen as a straw Man.
The Indian Sub-continent entered unprecedented Territory, we witnessed
the first tit-for-tat air strikes between India and Pakistan since
the 1971 war. The First Casualty in any War is the Truth and when I
dialled up Indian and Pakistan TV, it was mind boggling, the decibel
level was at 11. Planes were shot down, an Indian Air Force Pilot Wing
Commander Abhinandan who sports the most compelling handle-bar
moustache I have ever seen was captured and then released. The Indian
Army said they killed hundreds of Militants in their attack but has
provided no evidence and Pakistan is suing the Indians for
''eco-terrorism'' Of course, Narendra Modi is up against an Election
and his entire political raison d'être has been built on the basis of
Make India [or is Hindutva?] great again. He cannot back down or it
will be a Jimmy Carter type moment. On the other side, we have a
neophyte Prime Minister Imran Khan whom I must admit has displayed a
very deft touch.
"History tells us that wars are full of miscalculation." he said.
''We in India may not like this, but in terms of pure optics,
@ImranKhanPTI at the moment is winning the day by taking the moral
high ground'' said @sardesairajdeep
Arundhati Roy wrote ''Kashmir is potentially the most dangerous place
on earth, the flash-point for nuclear war'' in the Huffington Post.
You would have thought that Gold which is a Geopolitical Proxy would
have gone nuclear and the fact that it didn't is an interesting Price
Signal. India has withdrawn MFN status from Pakistan and therefore,
Pakistan will surely be a bigger Buyer of Kenyan Tea
“Pakistan imports around 65-70 million kg (mkg) of tea from Kenya
annually and this is bound to increase. This was reflected in the
price movement. Kenyan teas rose by ₹12-15 a kg today,” said Dipa
Shah, Chairman of The South India Tea Exporters Association.
These might be Salad Days for the Tea Crew like it once was for the
Coffee Kings [when we were Coffee Kingpins] in the 1970s when Brazil's
Coffee Crop was knocked out by a frost.
President Buhari won the election in Nigeria. The Big Story for me was
the low Turn-Out. It was just 36 percent, compared to about 45 percent
last time. The Stock Market is not enamoured with the idea of more
''Baba Go Slow'' economics and slumped on the news.
"There is no way in which one can buck the market." Prime Minister
Margaret Thatcher told the House of Commons many years ago and this
kept looping in my mind last week.
Firstly, the worst performing currency in the World in 2019 is the
Ghana Cedi which has retreated about -12.6% year to date.
“The performance of the cedi doesn’t correlate with the fundamentals,”
Opata said in a phone interview from the nation’s capital, Accra.
in Tanzania, the Shilling slumped to an all time Low. The Citizen was
shuttered for a week for writing a story about the same. The Bank of
Tanzania shuttered Forex Bureus after conducting unannounced
inspections. The Tanzanian Shilling is a continuous real time vote on
the state of Tanzania Inc. and the instinct to switch it off is
entirely a Fools Errand. The risk of an asymmetric down side move is
sky high now.
Meanwhile the Kenya Shilling crossed the psychologically important
100.00 mark last week. We underestimate the regional safe haven status
of the currency and I have noticed that these downside moves in the
Tanzanian Shilling are being mirrored by the strengthening of the
Kenya Shilling. The GOK appears to be inclining towards heavier
issuance in the Kenya Shilling with a tax Free Infrastructure Bond
slated for sale. If this is the thinking, then I expect the Shilling
to strengthen further as Kenya taps offshore funds. The Charts signal
a move as far as 92.00 but that might be too bold.
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Algeria's Leader Defies Protests to Seek Fifth, and Last, Term @bpolitics Africa |
Fresh calls for protests and strikes rippled through Algeria on
Monday, with some warning that President Abdelaziz Bouteflika’s
determination to run for a fifth term would set the nation ablaze even
as he vowed to stand down within a year.
The outburst of anger came almost immediately after Bouteflika’s
campaign filed his official nomination papers for the April 18
election and the 82-year-old president pledged to amend the
constitution if re-elected and announce a fresh ballot.
He also promised a fairer distribution of wealth in the OPEC member
that has done little over the decades to diversify its
energy-dependent economy or create enough jobs for a youthful and
increasingly frustrated population.
“I have listened and heard the screaming hearts of the protesters and
in particular the thousands of youths who alerted me about the future
of our nation,” Bouteflika, who has been in power since 1999, said in
a written statement, vowing to meet “the fundamental demand of the
people, which means changing the system.”
Bouteflika needs to withdraw his candidacy, former Prime Minister Ali
Benflis, who was among the key challengers to withdraw from the April
vote, said on the pan-Arab Al-Hadath satellite channel. “This is a
farce and a mockery,” he said, adding that “seeking a fifth term will
ignite the country.”
But leaders within “le pouvoir,” a loosely defined ruling coalition
including the military, appear unable to agree on a replacement. Some
have described Bouteflika’s proposal as a peaceful way out of the
political crisis. It also helps to buy time for a regime struggling to
find its way forward.
This “will ensure a soft exit out of this crisis,” Mohamed Kissari, a
lawmaker from the ruling FLN party, told the private Echourouk TV.
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Zimbabwe central bank borrows $985 million from African banks- governor @ReutersAfrica Africa |
Zimbabwe’s Reserve Bank has borrowed $985 million from African banks
including Mozambique’s central bank and the African Export and Import
Bank to purchase fuel and other critical imports, governor John
Mangudya said.
Zimbabwe is in the grip of a severe dollar crunch and last month
ditched a discredited 1:1 dollar peg for surrogate bond notes and
electronic dollars, merging them into a lower-value transitional
currency called the RTGS dollar.
Mangudya said the loans would be repaid from future gold earnings and
had a tenure of between three and five years.
Mangudya also said government borrowing from the central bank reached
$2.99 billion in December, about three times its permissible overdraft
limit.
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Mozambique Wants to Void $622 Million @CreditSuisse Loan @markets Africa |
Mozambique wants the guarantee it provided for a $622 million loan
arranged by Credit Suisse Group AG for state-owned ProIndicus
canceled, as fallout from the southern African nation’s hidden-debt
scandal spreads.
In a London lawsuit, the authorities are also calling for Credit
Suisse and other defendants to contribute to the repayment of a
related $535 million loan taken out by state-owned Mozambique Asset
Management, according to a statement emailed by the attorney general
Friday from the capital, Maputo. They’re want compensation from the
defendants too, it said.
Credit Suisse has yet to receive the claim and will respond in court
once it does, the lender said. It had no involvement in the MAM loan,
it said in an email. Credit Suisse was the lead arranger for the
ProIndicus debt, as well as an $850 million loan for a tuna
fishing-boat fleet that was later converted into a Eurobond.
The court action relates to $1.2 billion of loans the government
raised in 2013 and 2014 and then hid from the International Monetary
Fund and other donors. That led to a financing freeze in 2016, when
the debt was uncovered.
The government has missed payments on the credits, as well as its $727
million in Eurobonds, since early 2017, as it sought to restructure
them. In total, Mozambique guaranteed three loans for the projects
amounting to $2 billion.
The $727 million Eurobonds fell 0.4 percent on Friday to 86.89 cents
on the dollar, the lowest since November.
Former Finance Minister Manuel Chang, who presided over the
acquisition of the debt, has been arrested along with three ex-Credit
Suisse employees, ex-Privinvest Group salesman Jean Boustani, and the
son of a former Mozambican president.
In December, the U.S. Department of Justice accused the former Credit
Suisse workers, some government officials and others of creating the
maritime projects the debt funded as a front to enrich themselves.
They diverted at least $200 million of the financing to pay bribes and
kickbacks, according to a DOJ indictment.
Credit Suisse said in January the three former workers -- former
managing directors Andrew Pearse and Surjan Singh, and Detelina
Subeva, a vice president in the global financing unit -- deceived the
bank.
In November, a group of holders of Mozambique’s Eurobond and the
government reached an agreement in principal to restructure the notes.
The attorney general’s statement doesn’t mention this loan. The
Finance Ministry hasn’t responded to emails asking whether the
Eurobond restructuring will proceed as planned. VTB Capital, the
Russian lender that arranged the MAM debt, isn’t named as a defendant
in Mozambique’s claim in London.
In November, a Credit Suisse spokesman -- speaking on behalf of the
ProIndicus loan-syndicate working group that represents 86 percent of
the outstanding debt --- said the bank would seek a similar
restructuring deal to the Eurobond holders.
The Mozambican attorney general filed the lawsuit earlier this week.
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Fasten your seat belts, folks, the East African Century is already upon us @The_EastAfrican's @cobbo3 Africa |
That future was one of the things on the mind of Joshua Oigara, group
CEO and managing director of KCB, the closest thing to a pan-East
African bank, when I met him a fortnight ago in Nairobi.
Mr Oigara’s self-effacing demeanour belies big ideas, and his view of
the great possibilities in the region.
“If it does a few things right, Uganda can feed China,” he told me. Phew!
KCB is the only bank that operates in all the six member countries of
the East African Community.
He says one reason for this is that the bank has been able to “work
through and manage the contradictions that situations in EAC countries
present,” an approach he says those who want to win in the region need
to master.
“People would be surprised by the projects we have funded in the
region: Hotels, mines, schools, hospitals, housing, agriculture,” he
says.
Institutions like KCB that work regionally give credibility to the
East African project, but money, says Oigara, is the easy bit, and it
is not the magic bullet. The magic bullet is logistics and
infrastructure.
“You can have a free market, yes, but it will come to nothing if you
can’t move goods and services at all, or at speeds and costs that are
competitive,” he says.
“Potentially, in the years ahead, China will be able to get goods to
any part of Africa in a week,” Oigara says, and the OBOR could achieve
in more dramatic fashion what the African Continental Free Trade Area
is seeking to do.
What does China know that the rest of us have not yet cottoned on to?
A part of the puzzle lies in East Africa, and the other in the Indian
Ocean — where the region has its own “silk roads.”
Africa already has the largest working-age population in the world,
and it is expected to hit 1.1 billion in 2034 — larger than China and
India’s.
The world workplace is becoming African, and in Africa it’s getting
ever more East African.
The Eastern Africa region (defined by the UN as 20 nations all the way
from Djibouti and South Sudan to Mozambique) is the biggest by
population at 457 million people currently, compared with West Africa
at 402 million, while Middle Africa, anchored by DR Congo and
Cameroon, has 178 million people.
The region is in the middle of a baby boom, with kids born after 2000
who have never known a life without fast speed Internet entering
adulthood in 2019.
The median age in the EAC is 18 (Uganda is lowest at 15). On the other
hand, the median age in Southern Africa is 25.7.
Taking the case of Kenya alone, in the next five years, 10 million new
consumers in the country will be turning 18.
This has major implications for the economy at large, but also the
social makeup of the EAC: If 60 per cent of Kenyans were born after
1999 (when EAC II was established), it means the majority do not even
know that we once operated as a federation, or where the squabbles
between Kenya and Tanzania started.
Eastern Africa is also one of the fastest-growing economies in the
world. Today, Eastern Africa is a consumer market of 457 million. This
will grow to 587 by 2030, and 800 million consumers by 2050.
The global population growth will be driven by a population explosion
in East Africa (we shall still be having four babies per family for
most of this century!) In 2100, five countries in Africa will be among
the world's top 10 most populous nations.
Nigeria will rank 3rd, with a population of 793 million; DR Congo will
be 5th with 379 million; Tanzania will be 8th with 303 million;
Ethiopia 9th with 250 million; and Uganda 10th with 213 million. Kenya
will be in the next batch at 16th, with 142 million.
This means that, over the next few decades, outside Africa and Asia,
the US will be the only country in the top 10 in population – and
market size.
From Asia, the honours will belong to India, China, Pakistan and Indonesia.
Critically, in Africa, only Nigeria will be outside the greater East
African region, with DRC, Tanzania, Ethiopia and Uganda in the top 10
club.
So, while by 2100 the world will be African, home to more than one in
three people, Africa itself will largely be East African.
The northern half of the Indian Ocean, flanked westwards by Asia and
eastwards by Africa, will have the world’s largest economies and most
of its population.
And the Indian Ocean, which already accounts for half of the world’s
container traffic, will be by far the most decisive trading waterway
in the world.
By 2050 already, if you live outside the red circle, in reality, you
will already have less geopolitical clout in the world.
Like all things that offer power and riches, this Indian Ocean Grand
Zone needs an organising principle. China’s answer for an organising
principle is the “One Belt, One Road Initiative.”
This is one of the long-term reasons for what has been described as a
“military base race” in the Horn.
The US, and more recently China, have military bases in Djibouti not
too far from each other, as do France, Italy and Japan. Saudi Arabia
too is establishing a naval base in Djibouti.
The United Arab Emirates has just built a military base in Assab,
Eritrea. Last year, Turkey signed a deal with Sudan to rebuild the old
Ottoman-era port of Suakin on the Red Sea, which will include military
facilities.
Turkey has a military base in the Jaziira coastal area of Mogadishu,
its largest overseas military installation.
Not to be left behind, the UAE has a military training centre in the
Somalia capital Mogadishu, and got itself embroiled in a controversial
move for control of the Berbera port in the breakaway territory of
Somaliland.
But the race is not just for military bases. There is another track
where nations are competing to be the regional, and in general,
African logistics hub. For now, Djibouti has a leg up.
In the EAC, Kenya and Tanzania continue to bulk up their Mombasa and
Dar ports. The most ambitious initiative is the Bagamoyo port, 72
kilometres north of Dar es Salaam, with the $10 billion undertaking
partly funded by the Sultanate of Oman’s sovereign wealth fund and
China’s Exim Bank.
With a special economic zone, optimistic projections see Bagamoyo
being as busy as Rotterdam, and becoming Africa’s biggest container
port in the next 10 years.
Tanzania is also working on the Mwambani Port and Railway Corridor
(Mwaporc) to be built from Tanga.
When Uganda’s 1,445 kilometre-long oil pipeline arrives in Tanga,
sometime between 2022 and 2025, Tanzania will have an embarrassment of
port riches.
Kenya is still hoping to kick-start its on-off-on again Lamu
Port-South Sudan-Ethiopia-Transport Corridor (Lapsset), a once highly
billed 1,720km infrastructure and economic corridor – and that is just
in the first phase.
Farther south, Mozambique is planning the giant new $3 billion
Chongoene port project.
This means that between 2025 and 2040, the East African coast line
will be littered with the most foreign military bases in the world,
but also possibly the busiest chain of ports outside China.
Over the next three decades, the East African hinterland will also be
buttressed by developments that will shape its economy and its
integration.
In addition to the above, a few more stand out: On January 27,
Ethiopia formally opened a second terminal at Addis Ababa Bole
International Airport, doubling its capacity to 22 million annual
passengers, making it one of the biggest in Africa.
A few days earlier, travel consultancy ForwardKeys had reported that
Addis Ababa had overtaken Dubai, one of the world’s busiest airports,
as the leading feeder of long-haul passengers to Africa.
Ethiopian Airlines is the most profitable airline in Africa by a mile,
and flies to more destinations on the continent than any other
continental rival.
It is small wonder then that Ethiopia’s Prime Minister Abiy Ahmed,
whose reformist zeal is partly credited for the country’s change in
fortunes, was buoyed enough at the opening of the new terminal at Bole
to call on its management to “aim for a bigger facility with a
capacity to accommodate at least 100 million passengers.”
It speaks volumes that he could envision an Ethiopia, and region,
where at just one airport, 100 million people pass through, which
would place it in the top five at today’s numbers.
But it also underlies the far-reaching role that East African
airlines, especially Ethiopian Airlines and Kenya Airways, and in the
past few years RwandAir, have had in fashioning modern Africa.
At the close of the 20th century, and in the first 10 years of the
21st, Kenya Airways hopped almost everywhere to Southern and West
Africa.
In West Africa, it was often referred to as “the matatu in the air,”
because it was the most reliable way to get between capitals in the
region.
If you look at a flight map of Kenya Airways and Ethiopian Airlines
routes, they carve out a prosperity corridor, touching down in the
richest and most happening places on the continent.
Before China came along with its One Belt One Road, one could say that
KQ and ET had already built an “African Silk Road.”
In moving thousands of business people across the continent, they have
enabled the spread of popular African culture, including Nigerian
films from Nollywood and Naija music; fashion; innovation hubs; and
that common look of retail shops (so-called stalls) in Africa arranged
like the ones in Dubai, brought in by the African traders they have
flown to and from the Gulf.
Perhaps no vehicles have contributed to post-Cold War homogenisation
of Africa than the airlines, with KQ and ET taking the biscuit.
Now the race has been joined, with Tanzania trying to breathe life
into Air Tanzania, and Uganda investing in new aeroplanes to revive
its defunct Uganda Airlines.
Collectively, they could result in a definitive consolidation
eastwards of the “African hub,” and glue the region’s economies closer
to themselves, and with the rest of the continent.
Farther inland, after the Commonwealth Heads of Government Meeting in
Kigali, and the opening of its new Bugesera International Airport in
2020, alongside its massive urban investments, Rwanda will be close to
becoming the “African Singapore,” on the mainland at least.
It will anchor the explosion of smart cities, as nearly 60 per cent of
the regional population move to live in urban areas, and Lagos,
Kinshasa and Dar es Salaam rise to become the three largest cities in
the world by the close of the century.
Furthermore, with most of Africa living on the east side, and with the
majority of the fastest-growing economies being found there, by 2030,
we shall see the myriad economic groupings collapsing into probably
two.
On the west side, from Morocco, through the Maghreb and Sahel, to West
Africa and downwards via Angola into South Africa, we will have an
expanded Economic Community of West African States, possibly with a
new name. In any event, the Southern African Development Community
will have been swallowed up by 2050.
On the east side, the EAC will be thriving, but not under its present
name. It will have either merged, or been swept away by the Common
Market for Eastern and Southern Africa – running from Egypt (possibly
Libya too) to Mozambique – even earlier than SADC.
In any event, the EAC will disperse out of its present headquarters in
Arusha, with its functions strewn around Kigali in Rwanda, Machakos or
Kisumu in Kenya, and Jinja and Tororo in Uganda by 2030.
The politics of the region will also have changed to reflect the
architecture of the states.
Recently, Ethiopia announced it would do something Uganda has been
world famous for – it will allow refugees to work.
In Uganda, which has what some consider the most enlightened refugee
policy in the world, they also have the flexibility to go out and
create businesses.
In an East Africa that today has nearly 60 per cent of the world’s UN
peacekeepers, and most of the refugees on the continent, it could
herald the next new stage of African citizenship.
Even if South Sudan, Somalia, and Burundi don’t settle and begin
reconstruction in the next 10 years, it is likely that their citizens
who are refugees in Uganda, Kenya and Ethiopia could, in less than 20
years, cease to be refugees and become instead East African
“residents,” with the ability to vote in local elections.
The other development has been the rise of what one could describe as
“Somali capital,” which has been consolidated by a vast global
distribution network established by its widely scattered diaspora, and
which has eased doing global business for East Africans.
Somali money (regional and global) is very likely to become the most
important and fastest growing “African capital,” and the fluid that
lubricates the East African economy.
Together with the new citizenship forms, they could impact their
homelands in several ways that help them to economic recovery. It also
means the question of whether Somalia, for example, becomes part of
the EAC, will have been made moot by hard economic facts on the
ground.
South Sudan and Somalia do not have to be conventional states to
survive anymore; they could get by being half-native, half-regional.
Taken together with the policy change on refugees by Ethiopia, the
Abiy reforms, and the burying of the hatchet with Eritrea, then become
only the tip of emerging policies that will prove game-changers.
Consider what is happening at Ethiopia’s border with Kenya. Abiy,
himself an Oromo, has pursued a sometimes controversial pacification
of the Oromo, who have long opposed the regime in Addis Ababa and
brought it to its knees in early 2018. The Oromia Regional State
covers nearly all of Ethiopia’s border with Kenya.
In the past one year, Kenya has reaped a boom from its Ethiopia-facing
investments of the past decade.
The construction of the Mombasa-Nairobi-Addis Ababa road has brought
Mombasa back into play big as a key port for Ethiopia.
The 845km stretch from Mombasa to the border town of Moyale is
complete, and the Ethiopian section is expected to be done before the
end of 2019.
It is projected, conservatively, that trade between Kenya and Ethiopia
could jump fivefold from $35 million to $175 million by the end of
2019.
But it is the reforms in the banking and telecommunication sectors
that could send Nairobi to cloud nine.
There is a continuing emergence and growth of pan-African
multinationals, or national and regional companies that invest and
trade continentally.
The majority originate in countries in the four corners of Africa – in
the north in Egypt, in the west in Nigeria (especially Dangote
Cement); in the south, South Africa with the most, and in the east in
Kenya.
Kenyan companies are likely to benefit most from an open and
modernising Ethiopia.
Kenyan telco behemoth Safaricom, KCB and Bidco, a regional
multinational consumer goods company that operates and distributes in
16 African countries, are at Addis Ababa’s door waiting.
An Ethiopian entry would give them access to a market that, with 110
million people, is just shy of the EAC’s 150 million.
While it will mean more money in the bank for them, the
EAC-shape-shifting effect will come from having richer multinationals
favouring both an expansion and deepening of market integration.
It would bring us closer to a situation where there are companies that
are numerous enough, and also rich enough, to buy and install
pro-regional trade presidents in state houses, and fill the back
benches of parliament.
if you are 70, this is an East Africa you may never see. If you are a
centennial — born after 2000 – not only will you witness it in your
lifetime, but probably also well before you get married at 35. It’s
that close too.
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10 NOV 14 ::Ouagadougou's Signal to Sub-Sahara Africa 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
‘Blitzkrieg’.
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06-AUG-2018 :: The Indian Ocean Economy and a Port Race Africa |
Today from Massawa, Eritrea [admittedly on the Red Sea] to Djibouti,
from Berbera to Mogadishu, from Lamu to Mombasa to Tanga to Bagamoyo
to Dar Es Salaam, through Beira and Maputo all the way to Durban and
all points in between we are witnessing a Port race of sorts as
everyone seeks to get a piece of the Indian Ocean Port action. China
[The BRI initiative], the Gulf Countries [who now appear to see the
Horn of Africa as their hinterland], Japan and India [to a lesser
degree] are all jostling for optimal ‘’geo-economic’’ positioning.
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04-MAR-2019 :: Meanwhile the Kenya Shilling crossed the psychologically important 100.00 mark last week. Kenyan Economy |
Meanwhile the Kenya Shilling crossed the psychologically important
100.00 mark last week. We underestimate the regional safe haven status
of the currency and I have noticed that these downside moves in the
Tanzanian Shilling are being mirrored by the strengthening of the
Kenya Shilling. The GOK appears to be inclining towards heavier
issuance in the Kenya Shilling with a tax Free Infrastructure Bond
slated for sale. If this is the thinking, then I expect the Shilling
to strengthen further as Kenya taps offshore funds. The Charts signal
a move as far as 92.00 but that might be too bold.
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.@SafaricomPLC's #Fuliza tipped to lend Sh200 billion in 1 year @StandardKenya Kenyan Economy |
Analysts further expect Fuliza, an M-Pesa overdraft facility, to
generate Sh21 billion in revenues over the same period, while netting
two million new M-Pesa subscribers for Kenya’s largest
telecommunications firm.
In an investment report released last week, analysts at Sterling
Capital Ltd said Fuliza would cement Safaricom’s lead in the digital
payments sector, while at the same time clawing market share in other
traditional lending markets.
“Fuliza will have a positive impact on M-Pesa transactional volumes,
revenues, customer acquisition as well as retention,” said the firm.
“We also see it changing the competitive landscape with regards to
mobile and digital payments.”
Fuliza was launched in January this year, offering users an overdraft
to complete transactions if they run out of funds in the M-Pesa
accounts, with the telco lending out Sh6 billion in the first month.
Like its other mobile lending products like M-Shwari and KCB M-Pesa,
Fuliza is run in partnership with the KCB Group and Commercial Bank of
Africa (CBA) using algorithms from M-Pesa’s transactional data to
determine loan limits for users.
“We see a 14.5 per cent growth in M-Pesa revenues for the 2018/19
financial year to Sh72 billion and Sh82.3 billion in the 2019/20
financial year driven by growth in customer money transfer
transactions, payments and fees and commissions from strategic
business partnerships such as KCB M-Pesa, M-Shwari and Fuliza,”
explained Sterling Capital in part.
With the revenue share split between Safaricom, CBA and KCB Group set
at 40 per cent, 40 per cent and 20 per cent respectively, Sterling
Capital projects Safaricom to earn more than Sh7 billion in fees
charged on Fuliza, while pushing overall transactions up by 15 per
cent.
“We estimate that Sh2.2 billion would be generated in revenue through
the 1.08 per cent access fees and Sh3.1 billion through maintenance
fees,” explained the investment firm. A further Sh2.1 billion is
expected to accrue to Safaricom from the 40 per cent revenue share.
At the same time, analysts expect Fuliza to present a medium to
long-term competition to traditional payment methods like credit and
debit cards, rekindling the debate on whether Safaricom should also be
subject to financial sector regulations.
Last year, Central Bank Governor Dr Patrick Njoroge said the lender of
last resort would develop regulation to rein in predatory digital
lenders, while the Communications Authority of Kenya (CA) has
routinely called for a multi-agency approach for service providers
that traverse several sectors, a position that is strongly opposed by
some industry players.
“A lot of people say we are encouraging people to get into more debt
and these are usually people who do not understand what this product
is,” said Safaricom Chief Executive Bob Collymore in an interview last
month.
“The average repayment is in 2.8 days so people are really using this
as an overdraft facility to help them complete the transaction when
they don’t have enough cash in their wallets,” he added.
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