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issue 330 | 15 Nov 2019

Africa Business in Brief

 


Africa

African Development Bank celebrates historic capital increase

The African Development Bank celebrated a historic USD115-billion increase from its shareholders, the largest in the bank's 55-year history. “Today is a day of joy for Africa…because the shareholders of the African Development Bank trust the…Bank and have provided this financing,” Bank President Akinwumi Adesina told journalists later at a press conference. Adesina said the capital increase showed that the shareholders had “tremendous faith” in Africa and the Bank. At an extraordinary shareholders’ meeting held in Abidjan on 31 October 2019, Governors of the African Development Bank, representing shareholders from 80 member countries, approved the landmark  capital increase. The Bank’s capital base now stands at USD208-billion. Adesina said the shareholders had endorsed the Bank’s climate change strategy. “We as a Bank had said we are going to double our financing for climate change…so the shareholders strongly supported that direction…They are asking that we do a lot more on climate,” Adesina said. He also cited the recently launched Desert to Power initiative, which will help supply electricity to 250 million people in 11 countries across the Sahel by tapping into the region’s abundant solar resources.

Source: African Development Bank Group

Africa/Ethiopia

Addis Ababa to host 2019 Africa Fintech Summit

The 4th edition of the Africa Fintech Summit (AFTS) will be held in the Ethiopian capital Addis Ababa on 21 November 2019.  The summit will bring leading innovators, investors, and policy makers from around the world who represent over USD4.5-billion in private equity and venture capital funding. It will focus on the future of banking, mobile money growth and integration, policy and regulation, block chain, digital identity, remittances, and financial inclusion. Strategic partners for the Summit include the Corporate Council on Africa, the United States (US) State Department, the US-Nigeria Council, the Congo Business Network, and PeaceTech Lab. AFTS is the premier global initiative dedicated to financial technology in Africa, according to the press statement of the organisers.

Source:  Fana Broadcasting Corporate

Angola

Angola has a new diamond cutting company

KGK Angola, a diamond-cutting company with a capacity to process 100,000 gross carats of diamonds per year, was inaugurated on Monday in Luanda, bringing the number of these units in the country to a total of four, the Angolan media reported. The company is the result of a partnership between Hong Kong-based Indian-funded group KGK with a 65% stake, the Angolan national diamond trading company Sodiam, with 5% and UST, with the remaining 30%, with partners having invested USD5-million to date of the USD25-million investment expected in the first phase. The factory, inaugurated by the Minister of Mineral and Oil Resources, Diamantino Azevedo, complies with new international cutting standards, and has created 50 jobs for Angolans, which could increase to 200 by the first half of 2020.

Source: Macauhub

Kenya

Safaricom's half-year net profit up 14.4% to KES35.7-billion

Safaricom’s net profit for the six months through September this year jumped 14.4% to KES35.65-billion on strong M-Pesa and mobile data revenue growth that offset a decline in voice and messaging (SMS) revenues. This has set the telco on a course for the eighth straight year of increasing bottom-line. During the half year period, M-pesa revenue grew by 18.2% to KES41.97-billion as mobile data revenue increased by 4% to KES19.78 billion. Voice service revenue (drawn from incoming and outgoing calls) which makes up the bulk of the telco’s revenues declined 1.4% to KES46.87-billion while messaging revenue declined by 11% to KES8.6-billion. "Revenue growth for the half year to September 2019 was 5.3% driven by robust performance across M-Pesa and fixed data and strong customer growth offsetting decline in the traditional revenue streams and soft performance on mobile data," said Safaricom outgoing Chief Executive Michael Joseph while announcing the results at the firm’s headquarters in Nairobi.

Source: Business Daily

Kenya

Industrial parks plan gets KES413-million World Bank boost

Kenya has received a major boost in its efforts to build special economic enclaves after the World Bank came on board to provide technical support. The bank has approved a deal to offer advisory services in the development of a legal and regulatory framework special economic zones (SEZs) and proposed industrial parks. The SEZs are expected to play a big role in attracting high net worth investors into the country to mainly set up export-oriented enterprises. The project, whose budget is USD4-million (KES413-million) through December 2021, is being implemented by the International Finance Corporation (IFC) – the group’s arm that deals with investment and advisory services to encourage private sector development. IFC says in disclosures on 30 October 2019, the Kenya Investment Generation Project will help streamline the legal, regulatory and administrative environment for SEZ development.

Source: Business Daily

Kenya

Kenya offers citizenship in investor push

Kenya is mulling giving citizenship to wealthy investors in a new push to enhance direct foreign investment (FDI) flows, the country’s investment promotion agency said on Wednesday. High net worth investors, whose enterprises are appraised to have high impact on new jobs and exports earnings, will be allowed to automatically apply for citizenship, under the new proposals.  Immigration laws presently require a foreigner to continuously live in the country for at least seven years to qualify for citizenship by registration. Kenya Investment Authority (KenInvest) said the plan is to gift such investors with a permanent residence status after vetting, an equivalent of the Green Card in the United States.

Source: The EastAfrican

Kenya

Job cuts, firm losses force Treasury to up borrowing

The Treasury has opted to borrow more after an August audit revealed that the Kenya Revenue Authority (KRA) will miss its targets in a business environment plagued by job cuts and reduced corporate profits. The Budget outlook paper tabled in Parliament yesterday shows that the National Treasury has revised its borrowing target to KES640-billion for the year ending June next year, up from the KES607-billion it had unveiled in the June budget statement. Treasury will now target a deficit of 6.2% of gross domestic product (GDP) for the current fiscal year, which runs from July to June, compared with a forecast of 5.6% in June. It said the revision to its forecasts was driven by poor revenue collection and expenditure in 2018/2019.

Source: Business Daily

Malawi

Human Resource Bill on the cards

The Ministry of Justice has reaffirmed the Government’s commitment to see the Human Resource (HR) Management in Malawi Bill, which would regulate the HR profession in the country, tabled in Parliament soon. Minister of Justice and Constitutional Affairs, Bright Msaka, said this when he opened the Institute of People Management Malawi (IPMM) Annual Lakeshore Conference held under the theme ‘Energising Business Leadership; a Focus on Human Capital Management.” As part of the formulation process, the government has been engaging stakeholders for their input into the proposed law. If adopted, the law will help govern the profession and improve its effectiveness. Msaka said the Bill will be deliberated at cabinet level before end of the year and then be tabled to Parliament for deliberation. “The aim of this intended piece of legislation is to establish a professional body that will regulate and spearhead the human resource profession in Malawi. “I would like to assure you that the government will continue to champion the processing of the draft bill so that it is presented to Parliament for enactment,” Msaka said. Other professions such as accounting, auditing, law and procurement are regulated by specific Acts of Parliament. Msaka said it is only fit and proper that, the Human Resources Management profession, should also have own piece of legislation to regulate it.

Source: The Times Group

Malawi

Malawi Agricultural and Industrial Investment Corporation set to roll out

The Ministry of Justice has reaffirmed the Government’s commitment to see the Human Resource (HR) Management in Malawi Bill, which would regulate the HR profession in the country, tabled in Parliament soon. Minister of Justice and Constitutional Affairs, Bright Msaka, said this when he opened the Institute of People Management Malawi (IPMM) Annual Lakeshore Conference held under the theme ‘Energising Business Leadership; a Focus on Human Capital Management.” As part of the formulation process, the government has been engaging stakeholders for their input into the proposed law. If adopted, the law will help govern the profession and improve its effectiveness. Msaka said the Bill will be deliberated at cabinet level before end of the year and then be tabled to Parliament for deliberation. “The aim of this intended piece of legislation is to establish a professional body that will regulate and spearhead the human resource profession in Malawi. “I would like to assure you that the government will continue to champion the processing of the draft bill so that it is presented to Parliament for enactment,” Msaka said. Other professions such as accounting, auditing, law and procurement are regulated by specific Acts of Parliament. Msaka said it is only fit and proper that, the Human Resources Management profession, should also have own piece of legislation to regulate it.

Source: The Times Group

Mozambique

Total aiming for two additional LNG trains in Mozambique LNG

French energy major Total aims to expand its Mozambique liquefied natural gas (LNG) project with two additional trains, or plants, where the gas is supper-chilled for easier transport, a company executive said on Tuesday. “We’re starting to look at studies for train 3 and train 4, because the resources are clearly there to develop,” Mike Sangster, Head of Total Exploration and Production for Nigeria, told an oil conference in Cape Town, South Africa. Total concluded the acquisition of Anadarko’s 26.5% interest in the Mozambique LNG project for USD3.9-billion in September as part of its takeover of Anadarko’s Africa assets that included projects in Ghana and Algeria. Sangster added that the company expected to close its acquisition of Anadarko assets in Ghana and Algeria early next year once regulatory approvals were cleared. The firm said in September the Mozambique project included the construction of a two-train liquefaction plant with a capacity of 12.9 million tonnes per year. The firm has said 90% of Mozambique LNG was already sold under long-term contracts largely indexed to the oil price.

Source: Club of Mozambique

Mozambique

Mozambique entice global investors with scale of liquefied natural gas opportunity

Mozambique is officially positioning itself as the world’s next big global energy play. With 150 trillion cubic feet of liquefied natural gas (LNG) reserves, equivalent to 24 billion barrels of oil, the country is well placed to leverage its remarkable energy heritage to sustain broad and inclusive opportunity for generations to come. “This is especially so as the world looks to cleaner energy sources and China steams ahead with its fuel-switching policy – aimed at replacing coal with cleaner gas as an energy source,” said Omar Mithá, Chairman and Executive Officer, National Hydrocarbons Company of Mozambique (ENH). “If we get it right, Mozambique is in a position to become a long-term leading supplier of LNG to the world’s second largest economy,” noted Mithá. According to him, Japan and South Korea are also key growth markets for Mozambique LNG exports. In general, global demand for LNG is expected to increase by 4% per annum with the International Energy Agency (IEA) predicting that demand for gas will overtake coal in the global energy mix as early as 2030.

Source: ESI Africa 

Rwanda

Rwanda’s plan to become financial hub gains momentum

Momentum is building towards realising full development of the much-anticipated Kigali International Financial Centre (KIFC), an initiative by the Government that seeks to position Rwanda as a business and financial hub in Africa. A new company, Rwanda Finance Ltd, has been created to spearhead the development of KIFC and a chief executive officer was appointed. Several financial players have already bought into the idea. In 2017, the Government approved the establishment of the KFIC. The blueprint would basically position Rwanda as home for nationally or internationally significant financial service providers, enabling the country to handle finances for others. They will include banks, investment managers, hedge-funds or stock exchanges, among others. The blueprint seeks to facilitate the country to attract a concentration of participants in banking, asset management, insurance or financial markets with venues and supporting services for these activities to take place.

Source: The New Times

Rwanda/Namibia

PSF signs trade deal with Namibia firm

Rwanda’s Private Sector Federation (PSF) and a Namibian company, Habesha African Investments, have signed a Memorandum of Understanding to strengthen trade ties between both countries. The signing took place day in Kigali. The agreement seeks to facilitate collaboration between both countries in matters of common interest. It also aims at establishing the working arrangements necessary for the implementation of the agreement. The trade partnership will focus on sectors that engage in technical facilities, education, food processing, construction, technology gadgets, tourism and hospitality, officials said. Habesha Africa will send Namibian entrepreneurs and investors to explore investment and trading opportunities in Rwanda as it looks to enhance intra-Africa trade.

Source: The New Times

Tanzania

Mining, telecoms grow Tanzania’s economy; GDP low

Tanzania's economy expanded by 7.2% in the second quarter of 2019 compared with 6.1% in 2018. According to a Tanzania National Bureau of Statistics report released recently, the fast growth of the gross domestic product (GDP) in the April-June 2019 period was due to improved performance of construction, mining and communications sectors. “The largest share to GDP in the second quarter of 2019 was from tertiary activities which accounted to 41.5%, followed by primary activities by 32.9% and secondary activities had the least share of 25.7%, before adjustment for taxes,” the report said. Construction recorded the highest growth of 19.6% followed by mining and quarrying (17.2%) and information and communication (10.3%), it said. The economy grew by 6.6% in the first quarter of 2019 and government expects full-year GDP growth to expand by 7.1% this year, up from 7% last year.

Source: The EastAfrican

Uganda

Agent banking grows to 9,477 agents

Agent Banking has grown to about 9,477 agents spread across the country since it was launched slightly about a year and a half ago, according to Bank of Uganda Deputy Governor Louis Kasekende. Speaking during the World Saving Day celebrations in Kampala yesterday, Dr Kasekende said, under the National Financial Inclusion Strategy (2017-2022), which seeks to have all Ugandans access and use a broad range of quality and affordable financial services, the banking industry has seen some innovations such agent banking which have registered tremendous growth over the period. “The implementation of the strategy has thus far led to: the rollout of Agent Banking [which currently has] 9,477 agents spread across the country as at end September 2019,” he said, noting that the system seeks to provide access and convenience to savers. Agent Banking was launched in April 2018 with the view of easing access to financial services and enhancing financial inclusion.

Source: Daily Monitor

Uganda

Danish Investors in Uganda for agriculture opportunities

President Yoweri Museveni has encouraged Danish agricultural investors to consider setting up agricultural processing and production industries in Uganda as opposed to the costly process of importing agriculture machines. The President made the remarks while in a meeting with a visiting Danish agribusiness and food tech-business delegation from the Danish Agriculture and Food Council led by Jeppe Sondergaard Pedersen. The Danish companies seeking for opportunities to invest in agricultural transformation and share knowledge with Ugandan farmers include Cimbria, which deals in grain handling and storage and Danfos Company which specialises in cold chain and robot techniques. Others are Foss Company that supplies test agricultural equipment, Jyden Company that handles animal housing equipment, Blucher Company which supplies dairy plants and Engsko Company that specialises in supplying modern grilling stones.

Source: East African Business Week

Zimbabwe

Pros and cons of new cash injection into the economy

In its inaugural Press statement, the Monetary Policy Committee noted that the level of physical cash in the economy is inadequate to meet transactional demand. This is because the current proportion of cash to broad money supply of 4% is low compared to regional and international levels of 10-15%. This low ratio has resulted in an undesirable cash premium which the committee would like to see eliminated. The committee highlighted that there was need to boost the domestic availability of cash for transactional purposes through a gradual increase in cash supply over the next six months. Incrementalism will enable authorities to monitor the impact of cash injection in the economy as they keep an eye on money supply levels. The injection of more physical cash in the economy reduces adverse expectations because the injection of more notes and coins to replace existing real-time gross settlement (RTGS) balances minimises distortions that are prevalent in the economy.

Source: The Herald