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Satchu's Rich Wrap-Up
Friday 27th of May 2022

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Luck is luck. Luck isn’t structural... Luck is running out Zoltan Pozsar
World Of Finance

Luck is luck. Luck isn’t structural... Luck is running out; central banks were lucky to have price stability as a tailwind when they had to fight crises of FX pegs, par, repo, and the cash-futures basis. Those were the easy crises. The ones you can print your way out of with QE.
But not this time around...

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Its a Wizard of Oz moment This is ’Voodoo Economics’
World Of Finance

We have reached the point when the curtain was lifted in the Wizard of Oz and the Wizard revealed to be ‘’an ordinary conman from Omaha who has been using elaborate magic tricks and props to make himself seem “great and powerful”’’ 

The Curtain has been lifted and Mr. Powell has now arrived at his Volcker moment 

Deutsche Bank's Jim Reid notes that yesterday's surge in the 2-year US Treasury yield was, by one measure, "the biggest "shock" since October 1979 when Volcker announced his intentions on the world @ReutersJamie
The last time inflation was here, February 1982 - the Fed Funds Rate was 15%. @Convertbond
Dartmouth economist and former Fed adviser Andrew Levin says the Fed needs to get rates to a neutral setting within a year or so, and that the means getting the Fed Funds rates up to 4% or 5%

The worry is if Powell blinks 

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Inflation is out of control. Markets are imploding because investors are not confident that the @federalreserve will stop inflation. If the Fed doesn’t do its job, the market will do the Fed’s job, and that is what @BillAckman
World Of Finance

Inflation is out of control. Inflation expectations are getting out of control. Markets are imploding because investors are not confident that the @federalreserve will stop inflation. If the Fed doesn’t do its job, the market will do the Fed’s job, and that is what

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is happening now. The only way to stop today’s raging inflation is with aggressive monetary tightening @BillAckman
World Of Finance

Is happening now. The only way to stop today’s raging inflation is with aggressive monetary tightening or with a collapse in the economy. With today’s unprecedented job openings, 3.6% unemployment, long-term supply/demand imbalances in energy, ag and food, housing,

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The Fed has already lost credibility for its misread and late pivot on inflation. @BillAckman
World Of Finance

The Fed has already lost credibility for its misread and late pivot on inflation. There is no economic precedent for

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[There is no economic precedent for] 200 to 300 bps of fed funds addressing 8% inflation with employment at 3.6%. @BillAckman
World Of Finance

200 to 300 bps of fed funds addressing 8% inflation with employment at 3.6%. Current Fed policy and guidance are setting us up for double-digit sustained inflation that can only be forestalled by a market collapse or a massive increase in rates. That is why I believe there are no

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How does this downward market spiral end? It ends when the Fed puts a line in the sand on inflation and says it will do ‘whatever it takes.’ And then demonstrates it is serious by immediately raising rates to neutral @BillAckman
World Of Finance

buyers for stocks. How does this downward market spiral end? It ends when the Fed puts a line in the sand on inflation and says it will do ‘whatever it takes.’ And then demonstrates it is serious by immediately raising rates to neutral and committing to continue to

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Raise rates until the inflation genie is back in the bottle. @BillAckman
World Of Finance

raise rates until the inflation genie is back in the bottle. Stocks (of real businesses) are cheap once again. Markets will soar once investors can be confident that the days of runaway inflation are over. Let’s hope the Fed gets it right.

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Robert Frank Children with Sparklers in Provincetown Massachusetts, 1958

Things move on, time passes, people go away, and sometimes they don't come back. Only the photographs remain, resonant and unsparingly truthful. In them, they live on… 

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Chicago, Illinois photograph by René Burri (1971) @doug_marco

A photograph is a moment when you press the button, it will never come back. René Burri

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World War 3: Is The Stage Being Set For The US To Go To War With China And Russia Simultaneously? @zerohedge
Law & Politics

You would have to be out of your mind to fight wars with China and Russia simultaneously.  

Unfortunately, the guy in the White House actually fits that description.  

Joe Biden has been a hothead throughout his career in politics, but now he is a hothead that is in an advanced state of mental decline.  

And as I have warned for more than a year, he is surrounded by the worst foreign policy team in U.S. history, and that is really saying something.  

Biden and his team just keep making one colossal mistake after another, and now we are on a path that could soon have us fighting major wars with both China and Russia at the same time.

If there was ever a time to invoke the 25th Amendment, it is now.  

If we start shooting at the Chinese and the Russians, the unthinkable will actually become reality.  There will be no “do overs”, and there will be no going back to the way that life was before.

During a press conference in Japan, Biden was asked if he would use the U.S. military to defend Taiwan if China invades.  This is how he responded…
“Very quickly, you didn’t want to get involved in the Ukraine conflict militarily for obvious reasons. Are you willing to get involved militarily to defend Taiwan if it comes to that?” a reporter asked the president during a news conference in Japan.
“Yes,” Biden replied.
“You are?” the reporter pressed.
“That’s the commitment we made,” the president said.

As he made those remarks, Biden seemed dazed and confused, as if he was in some sort of a mental fog at the time.

Immediately after Biden’s press conference, administration officials attempted to walk back his remarks.

They said that he had “misspoke” and that there had been no change in policy.
But the damage had already been done, and the Chinese were furious.  

In fact, a spokesperson for the Chinese Foreign Ministry responded by stating that “there is no room for compromise” when it comes to Taiwan…
‘On issues concerning China’s sovereignty and territorial integrity and other core interests, there is no room for compromise,’ said Wang Wenbin, a spokesman for the Chinese Foreign Ministry.
‘We urged the US side to earnestly follow the One China principle … be cautious in words and deeds on the Taiwan issue, and not send any wrong signal to pro-Taiwan independence and separatist forces — so it won’t cause serious damage to the situation across the Taiwan Strait and China-US relations.’
China has always considered Taiwan to be Chinese territory, and in recent weeks there have been all sorts of rumblings that the Chinese are getting ready to invade.
Let me share just one example with you…
Officials from the Chinese finance ministry and central bank on April 22 met with representatives of dozens of banks, including HSBC, to discuss what Beijing could do in the event of the imposition of severe sanctions on China. 

The finance ministry noted, in the words of the Financial Times, that “all large foreign and domestic banks operating in China” were present.
Participants concluded Beijing could not protect foreign assets, but the holding of the “emergency meeting” is nonetheless ominous. 

Chinese officials have seen the effect of sanctions imposed on Russia after it launched its “special military operation” in Ukraine in February, and they are planning to weather any such measures applied to their own country.
Why would the Chinese hold such an emergency meeting?
Of course the answer is obvious.
The only reason why the U.S. would impose the same sort of sanctions on China as it has on Russia would be if China decided to invade Taiwan.
As I have detailed in previous articles, the Chinese have been sending military aircraft into Taiwan’s air defense identification zone on a constant basis for months.  

And there have been all sorts of reports and rumors that the Chinese military is actively making preparations for an invasion.
So that is why Biden is being asked about a potential invasion.  Everyone realizes that such a scenario is a distinct possibility.
And once China invades, the U.S. and China will immediately be in a state of war.
In fact, an article that was recently posted on Fox News is suggesting that the Chinese may actually launch a “first strike” against U.S. military assets if it decides to launch an invasion of Taiwan…
For China to seize Taiwan, it must first gain air superiority and then knock out Taiwan’s navy. 

And unlike Russia’s invasion of non-NATO ally Ukraine, China must assume from the start that America and Japan will swiftly come to Taiwan’s aid, meaning that China will launch a first strike on American and Japanese naval and air assets. 

Thus, unless successfully deterred, a Chinese invasion of Taiwan is likely to be a high-intensity affair from the first hour, with American ships, submarines, and air bases targeted by hundreds of Chinese missiles—regardless of whether America formally returns to strategic ambiguity or even abandons Taiwan as some suggest.
Personally, I don’t think that the Chinese would risk such an attack.
Instead, I think that they would hit Taiwan with overwhelming force and hope that Biden would just respond with sanctions.
But I could be wrong.
Switching gears, both sides continue to escalate the war in Ukraine.
On Sunday, we learned that the U.S. is actually considering sending troops into Ukraine to guard the U.S. embassy in Kiev…

Plans to send U.S. forces back into Ukraine to guard the recently reopened American Embassy in Kyiv are “underway at a relatively low level,” Gen. Mark Milley, the chairman of the Joint Chiefs of Staff, said Monday.
The Wall Street Journal reported Sunday that officials are mulling plans to send special forces to Kyiv to guard the U.S. Embassy. 

The effort is a delicate one, as it requires balancing the safety of American diplomats while avoiding what Russia could see as an escalation.
That is not a good idea, but rational people are not running our foreign policy at this point.
If rational people were making these decisions in Washington, we would not have already committed 54 billion dollars to this conflict.  

That is an amount that is nine times larger than what Ukraine normally spends on their entire military for an entire year.

In the war in Ukraine, it is the U.S. that is spending most of the money, it is the U.S. that is providing most of the equipment, it is the U.S. that is providing most of the intelligence, and U.S. Secretary of Defense Lloyd Austin has admitted that we are even flying members of the Ukrainian military into the United States to train them.

This has already become a full-blown proxy war between the United States and Russia, and we are dangerously close to it becoming an actual shooting war between our two nations.
And that is a scenario that we should be trying to avoid at all costs.
This week is is also being reported that Vladimir Putin “survived an assassination attempt” shortly after the war in Ukraine began…
Vladimir Putin survived an assassination attempt not long after starting his war in Ukraine, the country’s intelligence chief has claimed.
Kyrylo Budanov said Putin was ‘attacked.. by representatives of the Caucasus’ – a region that includes Armenia, Azerbaijan, Georgia and parts of southern Russia – around two months ago.
‘[It was an] Absolutely unsuccessful attempt, but it really happened… It was about 2 months ago,’ Budanov said. ‘I repeat, this attempt was unsuccessful. There was no publicity about this event, but it took place.’
If this happened, I severely doubt that it was “representatives of the Caucasus” that were ultimately behind it.
To me, it is far more likely that western intelligence was involved.
And this could explain why I saw Vladimir Putin in danger just before the Russians launched their special military operation.  In that experience I saw that Putin had been knocked down, but he had not been killed.
However, as I went on to explain, I had another experience that led me to believe that he will ultimately end up dead.  

Interestingly, it is being rumored that Putin underwent cancer surgery just last week…
Vladimir Putin underwent ‘successful’ cancer surgery last week and is recovering, it has been claimed in just the latest rumour about the Russian leader’s health.
The 69-year-old underwent an unknown procedure late last Monday following advice from medics that treatment was ‘essential’, according to Telegram channel General SVR which claims to be getting information from inside the Kremlin.
Some in the western media are cheering for Putin’s death, but I believe that whoever replaces him will be even more antagonistic toward the west.
My hope is that a way can be found to have peace, but at this moment U.S. officials do not seem inclined to pursue peace with Russia.
Meanwhile, the Biden administration has decided to allow the U.S. military to participate in “an Israeli drill simulating a massive attack on Iran’s nuclear facilities”…
As if an intense proxy war with nuclear powerhouse Russia isn’t bringing enough heat, the Biden White House has now given the greenlight for unprecedented U.S. participation in an Israeli drill simulating a massive attack on Iran’s nuclear facilities.

According to The Times of Israel, “The U.S. Air Force will serve as a complementary force, with refueling planes drilling with Israeli fighter jets as they simulate entering Iranian territory and carrying out repeated strikes.” 

The mock attack on Iran will happen this month, as part of a broader Israeli military exercise called “Chariots of Fire.”
This is another future war that I have been warning about, and I believe that it could erupt at any time in the months ahead.
And when the missiles start flying back and forth, the entire globe will be shocked by the carnage and devastation.
This is a time of wars and rumors of wars, and I believe that World War 3 has already started.
But for now the major powers are still not shooting at one another, and we should be very thankful for that.
Unfortunately, the Biden administration continues to make one glaring error after another, and at some point our good fortune will run out.

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Law & Politics

1-4-2-1. The first 1 refers to defending what has since come to be called the homeland. 

The 4 refers to deterring hostilities in four key regions of the world. 

The 2 means the U.S. armed forces must have the strength to win swiftly in two near-simultaneous conflicts in those regions. 

The final 1 means that we must win one of those conflicts “decisively,” toppling the enemy’s regime.

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Sunday, April 10, 2022 There is clearly zero intention to resolve this matter anywhere other than on the battlefield and through an insurgency which will bleed Russia to death and the Ukrainians as well.
Law & Politics

Secretary Blinken has refused to meet Lavrov, Biden calls for ‘’Regime Change’’ on a daily basis and ‘’defensive’’ weapons are being shoveled into Ukraine at an unprecedented speed. 

There is clearly zero intention to resolve this matter anywhere other than on the battlefield and through an insurgency which will bleed Russia to death and the Ukrainians as well.

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Ukrainian Presidential advisor Arestovych: "We are in a difficult situation, and it will get worse there may be encirclements, abandonment of positions, and heavy casualties,we are in for a tough month: depression, panic, and mutual accusations
Law & Politics

The Charge of the Light Brigade

Half a league, half a league, 

Half a league onward,
All in the valley of Death
Rode the six hundred. 

“Forward, the Light Brigade! 

Charge for the guns!” he said. 

Into the valley of Death
Rode the six hundred.
“Forward, the Light Brigade!” 

Was there a man dismayed? 

Not though the soldier knew
Someone had blundered. 

Theirs not to make reply, 

Theirs not to reason why, 

Theirs but to do and die. 

Into the valley of Death Rode the six hundred.

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Any astute Pakistan analyst understands that in the event of new election, the Sharifs would be pitted directly against an ever popular @ImranKhanPTI whose tsunami of public support will sink them. @TheCradleMedia @AyshakhanJadoon
Law & Politics

Amidst this national chaos, Imran Khan is demanding that new elections be held, only this time without the military’s support. 

The former PM believes that with unprecedented public support he can pressure the government and General Headquarters (GHQ) to agree to early polls. 

Khan has been addressing huge rallies almost every day in different cities across Pakistan, mobilizing the masses and increasing pressure on the military establishment – not by naming them directly, but couched in a veiled discourse to preserve the sanctity of the institution.

Without a plan or assistance, Pakistan’s current economic outlook is dire: inflation is rising, foreign reserves are fast depleting, fiscal and current account deficits are widening, the stock exchange is crashing, and access to food staples is is becoming more difficult for the average Pakistani. 

Widespread public dissatisfaction, internal political crisis, the global economic meltdown, and disrupted supply chains have thrust Pakistan into a tailspin – especially as state institutions lack a clear roadmap for salvation.

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@caitoz Caitlin Johnstone: They Fear Information, Not Disinformation
Law & Politics

All the safeguards being setting up now to manipulate information online are not there to eliminate lies, they’re there to eliminate truth.

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Currency Markets at a Glance WSJ
World Currencies

Euro 1.074570
Dollar Index 101.576
Japan Yen 126.8105
Swiss Franc 0.95841 
Pound 1.263050 
Aussie 0.713035 
India Rupee 77.64550 
South Korea Won 1255.290 
Brazil Real 4.7701 
Egypt Pound 18.60130 
South Africa Rand 15.701000 

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To deny that this move in the Ruble is real is to deny that energy is real. Such denial is how we got into this mess in the first place. @DoombergT
World Currencies

We gave Putin leverage, he foolishly chose to use it, and sanctions have not produced the desired result. All three are true.

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Sunday, April 10 ‘’You can print money, but not oil to heat or wheat to eat’’ wrote @CreditSuisse’s Zoltan Pozsar.
World Of Finance

Russia essentially gave the $ and the Euro the very same exorbitant privilege that King Abdul Aziz Ibn Saud of Saudi Arabia gave President Franklin D Roosevelt aboard the USS Quincy in Great Bitter Lake in February 14, 1945 when the petro dollar economy was symbolically born.

By insisting payments are made in Russian Rubles for Russian commodities Vladimir Putin has withdrawn that exorbitant privilege.
The Russian Ruble rally is real and has much further to go.

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The @POTUS Official Who Pierced Putin’s “Sanction-Proof” Economy @NewYorker
World Of Finance

Singh said, “We’ve made him stare into an economic abyss. But he could choose to pull back.”
The markets are where these two systems touch—the supply of buckwheat, the joint energy ventures, the price of the ruble—and within this arena the sanctions were a demonstration that Washington still had levers to pull. 

“You know, we can play chess, too,” Singh said. “It was important for us to show that the fortress could come crumbling down.”

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The democratization of authority spurred by the digital revolution has flattened cognitive hierarchies along with other hierarchies, and political decision-making is now driven by often weaponized babble. @FukuyamaFrancis
Law & Politics

Hubris (/ˈhjuːbrɪs/; from Ancient Greek ὕβρις (húbris) 'pride, insolence, outrage') describes a personality quality of extreme or excessive pride or dangerous overconfidence, often in combination with (or synonymous with) arrogance

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Diversifying With Commodities? Watch How They Roll @opinion @johnauthers

Commodities across the board rallied after the Russian invasion of Ukraine, now three months ago. 

Energy commodities have continued to rally, according to the Blomberg commodity spot price indexes; the same is not true of industrial or precious metals, or of agricultural commodities:

All of these commodities are traded in large and liquid futures markets. 

If we turn to the Commodity Research Bureau’s RIND (Raw Industrials) index, which covers the more important commodities that aren’t traded on futures and so arguably respond more directly to supply and demand pressures in the real world rather than in the index, a consistent rise to an all-time high has been followed in the last few weeks by the biggest correction in a while. 

It’s now approaching its 200-day moving average:

So there’s the eternal risk that it’s too late to dive in, which is compounded at present by the exceptionally high levels of geopolitical uncertainty surrounding Russia and also the Covid-driven shutdowns in China. 

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This is now turning into the most suicidal economic policy in Turkish history. @canokar
Emerging Markets

Inflation will continue to explode, and real interest rates will start approaching -100%.

This is now turning into the most suicidal economic policy in Turkish history. It is excruciating to watch this insanity because it is destroying the lives of millions of innocent people.

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Turkey Central Bank keeps its policy rate unchanged at 14.00% despite rising inflation at 70%. @akcakmak
Emerging Markets

Disappointing. After all, one would expect a CUT given rising inflation based on the higher rates-higher inflation doctrine.

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August 13, 2018 Cold Turkey
Emerging Markets

In 1998, Prime Minister Margaret Thatcher told the House of Commons: “There is no way in which one can buck the market.”

He said, “Don’t get high on your ambitions. You won’t be able make money on the back of this nation. You won’t be able to make this nation kneel.” 
And then ‘’Even if they got dollars, we got ‘our people, our God’’’ 

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War in Ukraine Puts Africa at Risk of Stagflation, Debt Distress @bpolitics @YahooFinance

Africa risks sliding into stagflation, a prolonged period of slow economic growth accompanied by high inflation, as price pressures and supply-chain disruptions emanating from Russia’s invasion of Ukraine stifle output, according to the African Development Bank.

The continent’s real gross domestic product is projected to expand by 4.1% in 2022, down from 6.9% last year, when it bounced back strongly from the impact of the coronavirus pandemic, the Abidjan, Ivory Coast-based lender said in its African Economic Outlook report published on Wednesday. 

It sees the growth rate at about 4% in 2023 if the conflict persists.
“The deceleration in growth highlights the severity of the impact of the Russia–Ukraine conflict on Africa’s economy,” AfDB President Akinwumi Adesina said in a forward to the report. 

The war in Ukraine “erupted as Africa’s economy was on a path of recovery from the ravaging impact of the pandemic, and it threatens to set back the continent’s promising economic prospects,” he said.
The bank projects that Africa’s average inflation rate will accelerate to 13.5% in 2022 from 13%, fueled by a sharp rise in commodity prices, especially energy and food.
Africa has also been hit by a sell-off in emerging-market debt, as the war spurs investors to seek safe havens. 

The premium investors demand over US treasuries to hold African sovereign debt has risen 165 basis points this year to 773 basis points, according to JPMorgan Chase & Co. indexes.
As such, indebtedness remains a threat to the continent’s economic recovery, despite recent international debt-relief initiatives, such as the Debt-Service Suspension Initiative, the Common Framework, and the International Monetary Fund’s general allocation of $650 billion-equivalent Special Drawing Rights, according to the AfDB.
While those initiatives have helped alleviate liquidity pressures in many countries by boosting their external buffers, they haven’t erased vulnerabilities, with 23 African countries either in or at risk of debt distress as of the end of February 2022, it said.
The AfDB expects the continent’s debt ratio to stabilize at about 70% of GDP this year, down from 71.4% in 2020, supported by economic growth and debt-relief measures. That’s still above pre-pandemic levels.
Structural reforms, such as debt restructuring and reprioritizing public spending, are required to ensure long-term sustainability.
About 30 million Africans were pushed into extreme poverty and about 22 million jobs were lost on the continent last year due to the pandemic.
The prolonged effect of economic disruptions stemming from the Ukraine war may push an additional 1.8 million Africans into extreme poverty this year and another 2.1 million in 2023.
The continent will need $118 billion to $146 billion a year until 2030 to meet targets countries have set to curb carbon emissions.

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.@AfDB_Group #AEO2022: African Economic Outlook 2022

The continent risks sliding into stagflation—a  combination  of slow growth and high inflation. 

If the conflict persists, Africa’s growth is likely to stagnate at around 4percent in 2023. 

Strikingly, oil-importing countries will gain the most in 2023, with growth increasing from 3.7percent in 2022  to  4.1percent

slight  growth deceleration in net oil-exporting countries, from 4.4percent in 2022 to 4.1percent in 2023. 

In these economies, the supply response to the positive price shock will remain subdued due to persistently weak production capacity in some countries.
Economic growth in 2021 was highest in North Africa (11.7percent) and East Africa (4.8percent). 

In 2022, growth is expected to decelerate to 4.5percent in North Africa and to stabilize at 4.7percent in East Africa. 

Average growth in 2021 in west Africa was 4.3percent and is projected to remain strong at 4.1percent in 2022.

Growth in Central Africa is projected to rise to 4.6percent in 2022, from 3.4percent in 2021. 

Southern Africa’s estimated growth of 4.2percent represented the largest recovery, from a contraction of 6.0percent, underpinned by strong recovery in Botswana (12.5percent), Mauritius  (4.0percent),  and  South  Africa  (4.9percent).  

Growth  in  the  region  is  projected  to  decelerate to 2.5percent in 2022 as the effects of large fiscal stimuli peter out.

Africa’s growth outlook is highly uncertain, with risks tilting to the downside. 

The spillover effects from the Russia–Ukraine conflict and related sanctions on Russia may cause a larger decline in global output than currently projected. 

A combination of low COVID-19 vaccination rollout and emergence of new COVID-19 variants may force countries to retain some restric-tions. 

Other downside factors include heightened debt vulnerabilities, tight global financial conditions as inflationary pressures rise, the effect of the Russia–Ukraine conflict and related sanctions on Russia, climate and environmental risks, and other sociopolitical and security issues. 

Upside factors include faster vaccination rollout, a comprehensive resolution of debt problems, and policies to accelerate structural transformation and build economic resilience.

Macroeconomic fundamentals have generally improved, but considerable challenges remain in the medium term, due largely to persistence of the pandemic effects and volatility induced by the impact of the Russia–Ukraine conflict. 

The average fiscal deficit in Africa is projected to narrow to 4.0percent of GDP in 2022, from 5.1percent in 2021, reflecting  scaling-down  of  COVID-19-related  interventions  and  relative  strengthening  of  domestic  

Africa  is  the  region  most  affected by climate shocks:  5 of the 10 most affected countries  in 2019 are on the continent.

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Africa’s GDP grew by an estimated 6.9 percent in 2021—a strong recovery from the pandemic-induced contraction of 1.6 percent in 2020 @AfDB_Group #AEO2022: African Economic Outlook 2022

Southern  Africa’s  estimated growth of 4.2 percent represented the largest recovery, from a contraction of 6.0 percent, underpinned by strong recovery in Botswana (12.5 percent), Zimbabwe (6.3 percent), and South Africa (4.9 percent).

Africa’s  fiscal  deficit  is  projected to narrow to 4.0 percent of GDP in 2022, from 5.1 percent in 2021, reflecting scaling-down of COVID-19-related interventions and strengthening of domestic revenues. 

The current account deficit is projected to be 2.0 percent of GDP in 2022, down from 2.4 percent in 2021, underpinned by the expected narrowing of the trade deficit and current transfers. 

Egypt, Kenya, Nigeria, and South Africa (which together accounted for 52percent of Africa’s GDP in 2021

Almost two-thirds of Africa’s economies saw exchange rate depreciation in 2021

Average  consumer  price  inflation in Africa  increased by an estimated 2.2percentage points to  13.0percent  in  2021, from 10.8percent in 2020 

FDI fell by 15.6percent in 2020 to $39.8billion, from $47.1billion in 2019

African  countries  recorded  an  outflow  of $19billion in portfolio investments in 2020, against a net inflow of $14.5billion  in  2019

remittance flows to Africa  remained  resilient in 2020  

Such flows reached $83.6billion in 2020, just  3.9per-cent below the $87billion in 2019.

If African economies grow at the same average rate as currently projected over 2021– 23, they would need more than a decade to catch up to the poverty rates projected before COVID-19

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Kenya Urged to Scrap Taxes on Grains After Wheat Prices Jump 58% @markets @eombok
Kenyan Economy

Eight lobby groups asked the Kenyan government to suspend import duties and other charges on key grains to avert a potentially devastating food crisis after the prices of wheat climbed by more than half in the past year.

Corn has jumped 47% to 4,200 shillings ($36) for a 90-kilogram bag in the year through April after persistent drought and lower cross-border inflows from other East African Community nations. 

Wheat prices have risen by 58% to 6,000 shillings per 90-kilogram bag, according to a statement by groups including the Kenya Association of Manufacturers, Cereal Millers Association, Eastern Africa Grain Council and United Grain Millers Association. 
“The high and volatile international prices have resulted in unprecedented retail prices,” they said. 

“Players in the sector have turned to the expensive importation of wheat from USA, Argentina, Australia and Canada.” 
Annual corn production is estimated at 3.2 million tons against consumption of 3.8 million tons, with imports from East African neighbors such as Uganda making up the difference. 

Kenya grows about 100,000 tons of wheat, compared with annual demand of 2.4 million tons, and plugs 60% of the deficit with imports from Ukraine and Russia, according to the statement.

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by Aly Khan Satchu (www.rich.co.ke)
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May 2022

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