This website uses cookies. If you continue to use this site you consent to the use of cookies on the site in accordance with our cookie policy.

find an article

 
PRINT |

Africa Business in Brief

 

issue 354 | 31 May 2020

Coronavirus (COVID-19)

A non-exhaustive list of recent measures aimed at curbing the spread of coronavirus (COVID-19)

Angola: The government declared a 15-day State of Public Calamity, from 26 May, which maintained travel restrictions into and out of Luanda province. The State of Calamity replaces a State of Emergency, relaxing various COVID-19 preventative restrictions.

Source: IHS Markit

Cabo Verde: The Government adopted a motion for a resolution on the second amendment of Resolution No. 97/2017 of 22 August by resolution No. 32/2020 of 24 February, which establishes the Programme to Promote Micro-Entrepreneurship, taking into account the effects of the COVID-19 crisis on the economy.

Source: Government of Cabo Verde

DRC: Prime Minister, Sylvestre Ilunga Ilunkamba, announced government's plan to set up COVID-19 laboratories in provinces affected by the pandemic.

Source: IHS Markit

Equatorial Guinea: The Senate Plenary met on 20 May to adopt and approve submission for the next stage of Equatorial Guinea's proposal to join the World Customs Organization.

Source: Government of Equatorial Guinea

Ethiopia: Finland has approved an additional extension of the CoWASH III project in support of Ethiopia’s COVID-19 emergency response. The extension, to run until the end of 2020 at a cost of USD2.67-million, is intended to contribute to COVID-19 emergency response activities in 45 woredas.

Source: Fana Broadcasting Corporate

Kenya: Freight charges at the Jomo Kenyatta International Airport (JKIA) have come down by almost half due to increased capacity of airlines amid declining demand for cargo, giving exporters a huge boost. JKIA has witnessed a sharp growth in capacity over the last one month, with the number of cargo airlines now standing at almost 12 from a low of three when the COVID-19 outbreak struck, pushing the cost of freight down to KES236 for a kilo from KES525 for the same quantity previously.

Source: Business Daily

Kenya: Private sector players, banks and analysts expect Kenya’s inflation to remain within the preferred Central Bank of Kenya (CBK) range for the rest of the year, with weaker demand and lower oil prices helping mitigate any COVID-19-related price increases. Inflation stood at 5.62% in April, up from 5.51% in March. The CBK’s preferred range is 5% plus or minus 2.5 percentage points.

Source: Business Daily

Kenya: The Central Bank of Kenya (CBK) has reached out to four international lenders in its effort to craft a credit guarantee scheme to help small and medium enterprises (SMEs) survive the COVID-19 crisis. The institutions involved in the credit guarantee scheme include the World Bank, International Finance Corporation, European Investment Bank and the African Development Bank. The four international financiers are expected to provide technical expertise and may contribute funds on top of the KES3-billion seed capital that the National Treasury has set aside to cushion banks that lend directly to SMEs.

Source: Business Daily

Malawi: The World Bank has tipped Malawi and other developing countries to improve on transparency if they are to build confidence among potential Foreign Direct Investors. The Bretton Woods’ institution says a stable investment climate is also crucial to woo investors. The suggestions are contained in a recent news release by the Bank where it has also committed to support 100 countries in their response to COVID-19. The Bank has pledged USD160-billion in grants and financial support over a 15-month period to help developing countries respond to the health, social and economic impacts of COVID-19.

Source: The Times Group

Namibia: The negative impact of the COVID-19 pandemic on the Namibian economy, combined with the rigidities of the Namibian economy and the government’s budgetary position, underlined Moody’s change in Namibia’s credit risk ratings’ outlook to Negative. Moody’s expects Namibia’s GDP to contract by 7% in 2020. Subdued global commodity prices and COVID-19 lockdown measures are expected to curtail mining production and exports during 2020, while tourism proceeds, contributing around 12% of GDP, are also expected to trail down as a result of the cessation of international travel. The weak growth combined with health-related spending on the COVID-19 virus outbreak are expected to widen the fiscal deficit to an estimated 10% of GDP in 2020, moderating only slowly to 8.5% of GDP in 2021.

Source: IHS Markit

Nigeria: Rivers State government has cancelled its former decision to resume lockdown of the capital city, comprising Obio/Akpor and Port Harcourt local government areas, as part of its strategy to contain the spread of the COVID-19 pandemic. The governor imposed an 8pm to 6am curfew in the 23 local government areas of the state from 2 June until further notice. He said “all land borders, including all exit and entry routes into Rivers State shall remain closed to human and vehicular traffic, except those on essential services and duly exempted”.

Source: The Nation

Rwanda: The government of Rwanda announced on 21 May, the disbursement of USD152-million to support the national airline – Rwandair – in this pandemic. Up by USD17-million from the initial plan, this financing should enable the company to sustain its cash flow, which has sharply declined since the suspension of scheduled flights on 19 March due to travel restrictions.

Source: Ecofin Agency

Rwanda: The waiver of fees on all mobile financial transactions by telecoms during the COVID-19 lockdown has led to fast growth in the value and number of mobile money transactions in Rwanda. Data compiled by resource centre insight2impact, and released by open forum for development NextBillion, indicates that the money transacted grew from RWF10.7billon (USD11-million) on 15 March, when the lockdown began, to RWF24billion (USD25.6-million) just a week later. The number of mobile money transactions has since grown exponentially, hitting RWF40.3billion (USD43-million) by 19 April, a 485% growth in value from 16 February, and 397% growth in transactions. The National Bank of Rwanda instructed mobile network operators to waive charges on all transfers with bank wallets, person-to-person and merchant fees on payments.

Source: Rwanda Today

Uganda: President Yoweri Museveni launched a certified surgical mask factory in Mukono. The President also noted that money has been injected into the Uganda Development Bank to support manufacturers with low-interest loans in order to enhance production. So far, five companies have been certified by the Uganda National Bureau of Standards (UNBS), to produce masks for both local use and export.

Source: New Vision

Africa

African Natural Resources Centre unveils publication to advance critical land policy reforms

In response to challenges across Africa around land ownership and use, the African Natural Resources Centre (ANRC) of the African Development Bank is launching a series of articles to aid policy debate. The articles are authored by influential international scholars whose pioneering research and analysis have helped to direct policy on land reform in Africa for more than two decades. The actions are expected to inject a new urgency into the need for land reform. The publication, Rethinking land reform in Africa: New ideas, Opportunities And Challenges, follows last November’s Conference on Land Policy in Africa, organised by the ANRC in Abidjan, and the 10th anniversary of the African Union Declaration on Land. The initiative is expected to inspire a breakthrough in land reform policy. Since independence, African governments have struggled to implement successful land policies. There is considerable scope to adopt new policies at a continental level that would allow an inclusive balance between customary and new approaches to ownership and use that fosters greater investment in agriculture.

Source: Africa Business Communities

Ethiopia

Ethiopia moves to open phone industry to investors

Ethiopia plans to sell 40% of the state-controlled telecommunications monopoly as the government moves to open up the industry to international operators for the first time. Details on the partial privatisation of Ethio Telecom will be announced “soon”, Brook Taye, an adviser to the state minister of finance, Eyob Tekalign, said on Thursday, 21 May. Ethiopia is also pushing ahead with plans to sell two new telecommunications licenses to compete with the state-controlled incumbent almost two years after Prime Minister Abiy Ahmed announced plans to part-privatise the market. The government has opened a month-long window for potential buyers to submit expressions of interest, with the International Finance Corporation acting as adviser. It will be a “competitive bidding process,” according to a statement from the Ethiopian Communication Authority (ECA). Last month, the ECA published the first three of a dozen draft directives to guide how the sector should operate with private carriers. Ethiopia’s initial plans to issue licenses by March were disrupted by the decision to hold elections on 29 August, which have since been postponed indefinitely due to the COVID-19 outbreak.

Source: Independent Online

Ethiopia

Amhara Region discovers 23 million tonnes of granite deposit

Granite deposit amounting more than 23 million tonnes has been discovered in three districts of east Gojam zone, Amhara regional state. The deposit was found in Baso Liben, Gozamin and Debre Elias districts, according to the regional state’s mines development and promotion agency.

Source: Fana Broadcasting Corporate

Ghana

Fairtrade introduces new cocoa and coffee certification to boost income of farmers

In a move to deepen benefits for farmers, Fairtrade International has announced a new requirement for cooperatives and traders applying for cocoa or coffee certification. The requirement, which takes effect 1 June 2020, obligates cooperative and trader applicants to have commitments in place for new Fairtrade sales volumes in order to be eligible for certification. This was contained in a statement signed by Ms May-Gloria Tedam, the regional communications officer of Fairtrade International and copied to the Ghana News Agency in Accra. It explained that the commitments must be confirmed by the end buyer, whose products bear the “FAIRTRADE Mark”, and validated by the respective national Fairtrade organisation. It would also be possible for new producer organisations to become certified, if necessary, to ensure supply continuity of an existing contract for Fairtrade certified cocoa or coffee. Ms Gelkha Buitrago, the director of Standards and Pricing of Fairtrade International, said: “This change seeks to ensure that newly certified coffee or cocoa cooperatives will immediately be able to sell on Fairtrade terms and provide benefit to their farmer members, and that existing Fairtrade cooperatives also continue to build their Fairtrade sales as demand grows.”

Source: Ghana Business News

Kenya

Bill proposes CBK-rate fee on late payments

Public entities will pay interest calculated at the Central Bank of Kenya (CBK) base rate for late payment to suppliers of goods and services if Parliament passes a new Bill into law. The Prompt Payment Bill, 2020, requires that a procuring entity shall pay for the goods, works or services provided by the prescribed payment date. “Failure to pay the amount due within the stipulated time, a procuring entity shall be liable to pay an interest calculated on the basis of the Central Bank base rate,” the Bill, cosponsored by Senators Farhiya Haji and Jonson Sakaja states. In last month’s meeting, the Monetary Policy Committee made a 25-basis point cut in the base rate, to 7% from 7.5%, which marked the fourth straight cut in the rate since the November 2019 meeting. The Bill comes at a time county and national governments are struggling to clear huge debts owed to suppliers of goods and services. Firms last year complained of accumulating pending bills amid credit rationing by commercial banks because of interest rate capping that had forced them to put on hold investment and expansion plans, hitting creation of jobs for the rising unemployed skilled youth. President Uhuru Kenyatta consequently directed ministries, departments and agencies to prioritise payment of the pending bills.

Source: Business Daily

Kenya

Legal framework for KQ takeover out by August

A legal framework for the nationalisation of Kenya Airways (KQ) is set for discussion when Parliament resumes in what could change stakes for key shareholders that include a consortium of local banks and Royal Dutch Airlines. The Parliamentary Transport Committee has come up with the National Aviation Management Bill 2020 that seeks to guide implementation of its earlier report that recommended the state’s takeover of the national carrier. Under the plan, the government, which owns 48.9% of KQ, is expected to buy out the remaining holders of 51.1% of the shares, and form Aviation Holding Company to run the national carrier and Kenya Airports Authority (KAA). The Cabinet has approved the National Aviation Management Bill, which is currently at the State Law Office for refinement before being brought to Parliament. Transport Committee chairman David Pkosing said his team would push the Bill through all stages by August. In their report adopted by the house last year, the committee recommended tax exemptions for the National Aviation Company as a way of saving the dwindling fortunes of the national carrier. The report had also recommended that the KAA, Jomo Kenyatta International Airport and KQ to be put under Kenya Aviation Holding Group.

Source: Business Daily

Mozambique

Coral Sul FLNG gets first topside module

With the lifting of the power generation module, the FLNG project led by Italy’s Eni marks the beginning of the integration between the hull and the topside, according to a Coral FLNG statement. The hull, also being built in South Korea, was launched in the beginning of January. The massive topside includes 12 process modules weighing around 70,000 tonnes. “The construction of the FLNG facility is progressing well aiming towards the commencement of production in 2022”, the statement said. The unit is part of the Coral South project, which will put in production 450 billion cubic metres of gas from the giant Coral reservoir in the Area 4 block offshore Mozambique. The Coral Sul FLNG facility will have a liquefaction capacity of 3.4 million tonnes per year when completed. Construction works on the Coral Sul FLNG started in 2018 and are ongoing in seven operational centres across the world.

Source: Offshore Energy

Mozambique

Financial restructuring generates more revenue for state in Area 1

The Council of Ministers has approved the Decree (No. 51/2019) amending the Financing Structure of the Liquefied Natural Gas Dolphin and Tuna Project, in order to give the project a better framework. One of the objectives of the review is to allow the inclusion of the French multinational Total E&P Mozambique Area 1 into the shareholder structure, replacing its North American counterpart, Anadarko, which is no longer part of the group due to the sale of its stake. According to Minister of Mineral Resources and Energy, Max Tonela, this review “also aims to create conditions for flexibility with regard to the development of related projects”. According to the terms of the structure and commitments approved last year, under the Final Investment Decision (FID), concessionaires could only develop the project’s subsequent steps from 2026. But the entry of Total changes the scenario, both in terms of schedule and in terms of revenue for shareholders. “With the entry of Total, an exercise in financing optimisation was carried out, which creates conditions for the survey process to present the second onshore project in Area 1 to take place still in the current term of office”, Tonela explained.

Source: Club of Mozambique

Nigeria

Buhari approves funding for first phase of Siemens power deal

President Muhammadu Buhari has approved the release of funds for the first phase of the Siemens electricity deal. In 2019, the president had signed a power project deal with Siemens AG, Germany-based firm, to deliver 7,000 MW of electricity to the national grid by 2021. “President Buhari has directed the Ministries of Power and Finance, and the Bureau of Public Enterprise (BPE) to conclude the engagement with Siemens AG to commence the pre-engineering and concessionary financing aspects of the Presidential Power Initiative,” the presidency tweeted. “The Presidential Power Initiative (PPI) is a power infrastructure upgrade and modernization Programme agreed to by Nigerian government and Siemens AG of Germany, with the support of the German Government.” The funding for the PPI will be secured under concessionary terms (up to 3-year moratorium and 12-year repayment at concessionary interest rates) through the German Euler Hermes cover, which the Nigeria government will on-lend as a convertible loan to the other shareholders in the DisCos. The president added that the ultimate goal of the PPI is to modernise and increase the country’s electricity grid capacity from about 5 to 25 gigawatts (GW) over three phases.

Source: The Cable

Nigeria

NCC suspends Spectrum Trading Guidelines 2018

Nigerian Communications Commission (NCC) has suspended the Spectrum Trading Guidelines 2018 for the Nigerian telecommunications industry. The Board of Commissioners is informing all licensed telecommunications operators, prospective investors, industry stakeholders and the general public in that regard. The Board had earlier taken the decision for spectrum trading in response to telecommunications global dynamics as well as the efforts to optimally utilise and maximise the benefits of the spectrum scarce resource. The Nigerian National Broadband Plan (NNBP) 2020 – 2025 launched by President Muhammadu Buhari, in Abuja in March 2020 requires that these Guidelines be reviewed to ensure that unutilised spectrum is fairly traded and to facilitate rollout by other operators, amongst others. This is to address the need for ubiquitous broadband deployment to accelerate penetration and access in line with the economic agenda of the Federal Government.

Source: Nigeria CommunicationsWeek

Rwanda

Rwanda set to double sardine fish production

National fish production could double following the introduction of sardine fish species known as Isambaza into two twin lakes of Burera and Ruhondo in Northern Province. Sardine fish were only available in Lake Kivu. Following trials, the fish species will, for the first time, be harvested for the other two northern lakes beginning June this year, according to Solange Uwituze, deputy director general of Animal Research and Technology Transfer at Rwanda Agriculture and Animal Resources Development Board. She explained the current production of sardine from Lake Kivu varies between 300 tonnes to 500 tonnes per week and the Lakes of Burera and Ruhondo could also provide 500 tonnes per week if the species adapt well. “The expected production from (the) twin lakes will depend on their adaptability. If their (sardine) adaptability continues the same as the one on Lake Kivu, they are expected to provide more than 500 tonnes at high season every week but this will only be possible once fishermen respect the regulations,” she said. Uwituze said that samples captured from 19 to 23 May this year, indicate steady growth and adaptation of sardine in the two lakes. Rwanda seeks to reach 112,000 tonnes of fish output per year by 2024. The country’s fish produce falls short of its demand as it has been importing more than 15,000 tons per year.

Source: The New Times

Rwanda

Rwanda unveils USD11-billion climate action plan

Rwanda has become the first African country to submit a new national climate plan, whose implementation requires USD11-billion, as an essential tool to implement the Paris Agreement. The 26th session of the Conference of the Parties (COP-26) to the United Nations Framework Convention on Climate Change (UNFCCC) was planned to take place from 9-19 November 2020, in Glasgow, UK but it has been postponed to 2021. The updated pledges to fight climate change are being submitted ahead of COP-26. According to the submitted new climate plan to fight climate change through 2030, the total estimated cost for mitigation measures is estimated at around USD5.7-billion, and over USD5.3-billion for adaptation priorities, representing a combined funding requirement of around USD11-billion. Rwanda’s mitigation contribution seeks a 38% reduction in gas emissions equivalent to 4.6 million tonnes of carbon dioxide in 2030. The emissions that include gases carbon dioxide, methane nitrous oxide, and hydrofluorocarbons are from the energy, industrial processes and product use, waste, and agriculture, forestry, other land use sectors, as well as other sectors. 24 adaptation interventions are proposed in the water, agriculture, land, and forestry, human settlement, health, transport, and mining sectors.

Source: The New Times

Tanzania

State - fish packages must bear Tanzania labels

Deputy minister for Industry and Trade Eng Stella Manyanya has directed all fish processing industries in the country to ensure all fish packages are labelled with the Tanzania mark before they are shipped out of the country. The directives come a day after the first cargo flight for fish fillets by Ethiopian airlines left Mwanza Airport. Speaking during her tour at Tanzania Fish Processors Ltd factory in Mwanza, she said the fifth phase, government had taken all measures to improve industries in the country, in particular fish industries that have a large market in different countries around the world. "The government is committed to ensuring that it improves the fishing industry because it is an important sector in facilitating economic growth. We will also establish research institutions in Lake Victoria and fish markets aimed at stimulating this sector. In line with the procedure, we will hold regular meetings between the government and fish business associations, to assist in resolving various concerns hampering traders," she said.

Source: Daily News

Zambia

Accelerating digital transformation in Zambia: Digital Economy Diagnostic Report

Zambia’s seventh national development plan (7NDP) sets ambitious targets for economic growth and poverty reduction. Improved access to digital technologies and effective use of data and digital systems can be powerful tools in the quest to increase private sector productivity, enhance public sector efficiency and effectiveness, and improve the accountability of both the public and private sectors. This digital economy diagnostic assesses Zambia’s strengths and weaknesses with respect to five pillars that together form the foundation upon which the benefits of digital transformation can be realised. These pillars are digital infrastructure, digital skills, digital entrepreneurship, digital platforms, and digital financial services. The analysis finds that Zambia has made significant strides on its path to digital transformation over the past few years. Progress is particularly evident in digital infrastructure, digital financial services, and digital platforms, while more significant gaps remain in digital skills and digital entrepreneurship.

Source: World Bank Group

Zambia

Zambia to amend mining rules to treat gold as strategic asset

Zambia is moving to amend gold-mining rules so that the metal can be treated as strategic. The cabinet agreed to amend the Mines Act to align it with a policy set last October to recognise gold as a strategic mineral. That requires production by artisanal miners to be bought through the state-owned mining investment company ZCCM-IH Plc. The cabinet’s 20 May approval to modify laws and regulations stemmed from a proposal from the mines minister, according to the ministry’s permanent secretary, Barnaby Mulenga. Zambia wants its national gold production to help the Central Bank build up the nation’s strategic reserves. ZCCM-IH has been mandated to coordinate the purchasing and trading business in Zambia. The country mined about 4,000 kilograms of gold in 2018 and is Africa’s second-largest copper producer.

Source: BloombergQuint

Zimbabwe

Government reviews gold trading framework, producers to get 30% of their funds in local currency

The government has reviewed the gold producer trading framework. The previous arrangement saw producers walking away with 55% in USD and the remainder being paid using Zimbabwe Dollars. According to a statement, gold producers will now get 70% of their proceeds in USD. With effect from 26 May 2020, the gold trading framework in Zimbabwe has been reviewed, including: “gold producers shall be paid under a 70/30 payment arrangement scheme in terms of which 70% of the gold sale proceeds shall be paid into the producer’s Nostro account and the balance of 30% shall be paid in local currency at the ruling exchange rate into the producer’s ZW$ account… Large gold buying agents must have a mining operation producing a minimum of fifty (50) kilograms fine gold per month to qualify for a Fidelity Printers and Refiners (FPR) agency permit. FPR and the National Gold Monitoring Teams are enhancing surveillance to ensure that all gold is sold through FPR in line with the country’s regulations.”

Source:  Pindula News