issue 431 | 16 Jan 2022
AfricaHow new pan-African payment system will boost AfCFTA implementation
The Pan-African Payments and Settlement System (PAPSS) launched on Thursday, 13 January in Ghana, leaders say, will provide African traders a faster and safer mode of payment, among other things. The new system allows a buyer in one African country to make a payment in his or her national currency and a seller in another country receives payment in his or her own national currency, effectively eliminating the need for third party currencies such as the United States dollar to complete trade within the continent. Ade Ayeyemi, CEO of Ecobank Group, noted that instant payment is critical as it enables people in Africa “to be able to transact across the continent without the need to say, ‘where do I get the currency to buy from?’” For the very first time, traders will be able to pay and receive payment in their local currencies, thereby removing the cost of acquiring “hard currencies.” Its virtual launch, held under the theme ‘Connecting Payments, Accelerating Africa’s trade’, came following a “successful pilot” in six countries – The Gambia, Ghana, Guinea, Liberia, Nigeria and Sierra Leone. Payment infrastructure always existed but on the national and sub-regional levels, they lacked crucial ingredients such as interoperability. The system has been piloted and tested and “proved to work,” using African currencies, said Mike Ogbalu, the CEO of PAPSS.
Source: The New Times
BotswanaAfrican Development Bank’s SEFA to provide USD1-million in support of Botswana’s energy transition
The Sustainable Energy Fund for Africa (SEFA), managed by the African Development Bank (AfDB), has approved a USD1-million grant to facilitate Botswana’s transition to clean energy. The technical assistance project supports the Government of Botswana in closing critical gaps in policy, regulatory and legal frameworks, which were identified at the Africa Energy Market Place (AEMP 2019). These include the introduction of least-cost planning, reduction of adverse environmental impacts and support for increased private sector participation in renewable energy generation investments. Some of the notable outputs from the project include a national Grid Code, Electricity Cost of Service Study and licensing framework to regulate power sector activities. The outputs from the project will contribute towards the implementation of Botswana’s first Integrated Resource Plan, thus facilitating investments in new solar photovoltaic and wind generation capacity, amounting to at least 100 MW and 50 MW, respectively, by 2030.
Botswana / Ghana / MauritiusBotswana, Ghana, Mauritius removed from European Union list of high-risk third countries
The Financial Action Task Force (FATF) welcomed significant progress made by Botswana, Ghana and Mauritius in improving their anti-money laundering / combatting the financing of terrorism (AML/CFT) regimes and noted that Botswana, Ghana and Mauritius have established the legal and regulatory framework to meet the commitments in their action plans regarding the strategic deficiencies that the FATF had identified. The European Commission's analysis concludes that The Bahamas, Botswana, Ghana, Iraq and Mauritius no longer have strategic deficiencies in their AML/CFT regimes considering the available information. These countries have strengthened the effectiveness of their AML/CFT regimes. These measures are sufficiently comprehensive and meet the necessary requirements to consider that strategic deficiencies identified under article 9 of the Directive (EU) 2015/849 have been removed.
Source: European Commission
Burkina Faso / Mali / Senegal / South SudanBurkina Faso, Mali, Senegal, South Sudan added to European Union list of high-risk third countries
The European Commission considered Burkina Faso, Cayman Islands, Haiti, Jordan, Mali, Morocco, the Philippines, Senegal, and South Sudan as having strategic deficiencies in their anti-money laundering / combatting the financing of terrorism (AML/CFT) regimes, also based on the fact that these countries were identified in the Financial Action Task Force (FATF) list of “Jurisdictions under Increased Monitoring” in February, June or October 2021. Consequently, the Commission considers that Burkina Faso, Cayman Islands, Haiti, Jordan, Mali, Morocco, the Philippines, Senegal, and South Sudan meet the criteria set in article 9(2) of Directive (EU) 2015/849. These countries should be added to the list of the Delegated Regulation (EU) 2016/1675 as countries presenting strategic deficiencies in their AML/CFT regimes that pose significant threats to the financial system of the EU. Burkina Faso, Cayman Islands, Haiti, Jordan, Mali, Morocco, the Philippines, Senegal, South Sudan and Turkey provided a written high-level political commitment to address the identified deficiencies and developed an action plan with the FATF for this purpose.
Source: European Commission
KenyaHigh Court suspends 50% rise in car insurance
The High Court has suspended the planned increase of motor vehicle insurance premiums by up to 50%, pending the determination of a case filed by a lobby group. Justice James Makau said in a ruling that the case by Kenya Human Rights Commission has chances of success, owing to the issues raised in the petition. The judge also issued an order suspending a decision by insurance firms not offering a comprehensive insurance cover for motor vehicles that are older than 12 years or with a value of less than KES600 000. The case will be mentioned on 14 February. “I have considered the petitioners' grounds in support of the application and oral submissions by both parties upon careful evaluation of the same, I find that the petitioner has demonstrated a prima facie case with a likelihood of success,” the judge said. The lobby group had rushed to court accusing the Insurance Regulatory Authority (IRA) of failing to protect the public and policyholders from such an increase. The judge said failing to suspend the planned increase was likely to prejudice the public, whereas the underwriters would not suffer if the order is granted.
Source: Business Daily
KenyaKenya's food imports bill rises fastest in four years
Kenya’s food imports’ bill in the first nine months grew fastest since 2017 driven by a rise in the food products shipped by industries for processing before selling in the local market. The latest data from the Kenya National Bureau of Statistics (KNBS) shows that the food import bill rose 21% to KES155.42-billion from KES128.06-billion in 2020. The data shows that imports of food products drove the increase as industries sourced more for value-addition before selling in the local market. This is the fastest growth in the food import bill in the first nine months since a 60% jump posted in the same period in 2016 when the bill stood at KES82.83-billion. Retailers link the jump to the growing popularity of online trading that has increased direct ordering and shipping of food and a deficiency in condiments – used to add flavour or colour to food like barbeque sauce, compound butter and teriyaki sauce. “There has been a rise in online trading that has now made it possible for people to source varieties that are not available locally and bring them. It is also cheaper to get most of the products abroad than locally,” Wambui Mbarire, CEO of Retail Trade Association of Kenya.
Source: Business Daily
KenyaWarehouse receipts unlock credit facilities for farmers
Farmers can now access loans from banks using warehouse receipts following the official launch of the Warehouse Receipting System (WRS) as the Agriculture ministry moves to lockout middlemen. The launch comes as a boost to farmers who have completed maize harvesting for the main season as they now have an opportunity to store their produce under the ideal conditions to avoid post-harvest losses associated with poor storage. Agriculture Cabinet Secretary Peter Munya, who launched the WRS scheme at one of the approved warehouse stores at the National Cereals and Produce Board (NCPB) depot in Kitale said the move is key to taming cartels. NCPB managing director Joseph Kimote said the agency has five stores that have been licensed and approved for the storage of maize in Kitale, Eldoret Meru, Nakuru and Nairobi. He added that NCPB has placed aflatoxin testing machines in each of the depots that will help in ensuring that the grain meets the required standards. Parliament passed the Warehouse Receipt Systems Act 2019 in June 2019 providing a legal as well as the regulatory framework for development and regulation of the WRS and establishment of its council.
Source: Business Daily
MalawiAmended Act to boost domestic investments
The Ministry of Trade is reviewing the Investment and Export Promotion Act, 2012 to put local investors in the forefront of the country’s investment drive. The ministry’s Director of Trade Charity Musonzo said in an interview that the review is being facilitated by authorities at the ministry, the Malawi Investment and Trade Centre (MITC) and other stakeholders who feel the current Act largely favours foreign investors at the expense of locals. She said if approved by parliament, the amended Bill, which is at the Ministry of Justice for refining, will be a game-changer in facilitating domestic investment. Musonzo said the ministry wants to make Malawi a globally competitive investment and export-oriented economy, through trade and private sector development. She said: “Under the ministry’s strategic objective of creating an enabling and competitive environment for the private sector, the Ministry of Trade is implementing the National Trade and Investment Policy through various strategies. The strategies recognise that international trade is a fiercely competitive economic space where the strongest and fittest wins and where without state intervention, businesses are marginalised.”
Source: The Nation
MauritiusMauritius lifts travel ban on Namibia, SA
The COVID-19 travel ban imposed by Mauritius on Namibia, South Africa, Botswana, Zimbabwe, Eswatini, Lesotho, Malawi, Mozambique and Zambia has been lifted. “We are very pleased that South Africans can once again travel to Mauritius,” said Arvind Bundhun, director of the Mauritius Tourism Promotion Authority (MTPA). “COVID-19 has placed significant pressure on all nations to do the right thing and we thank South Africans and the South African travel industry for their patience.” The ban has had dire consequences for the travel and tourism industries of both Mauritius and South Africa, the latter typically sending about 120 000 travellers to the island each year, reported The Sunday Times. Mauritius had initially extended its ban on travel from southern African countries until 31 January, despite the presence of the COVID-19 Omicron variant on the Indian Ocean island. The Association of Southern African Travel Agents (ASATA) has been lobbying the Mauritian government to lift the ban. MTPA said in a statement that the country's health authorities continued to implement a wide-ranging COVID-19 response and were prioritising the rollout of booster doses for people who are already double vaccinated.
Source: The Namibian
MozambiqueMozambique takes first step towards large solar with 44 MW floating solar plan
Mozambique, the 32 million strong South East African country is making its first bid for a floating solar plant. State-owned power company Electricidade de Moçambique (EDM) is seeking a consultancy that will conduct a feasibility study to assess the potential and implications of setting up a floating solar farm at a hydro power reservoir in the south-eastern African country. The plant, if approved, will probably be funded by the African Development Bank (AfDB), which is also funding the feasibility study and had also released a formal Expression of Interest (EOI) for this requirement on 23 December 2021. The request for the EOI, invites consultants to submit their applications by 28 January. The object of the floating solar plant of 44 MW capacity floating plant is the reservoir of the 44 MW Chicamba hydroelectric power plant in Manica province. The AfDB-sponsored study should consider technical and financial viability, environmental impact assessment for the power plant infrastructure and interconnection lines, the environmental impact of the dam and marine ecosystem, and socio-economic aspects of the proposed project. The resulting data will guide EDM and other local stakeholders in the decision-making process, the power company said.
Source: Saur Energy
NamibiaNamRA calls on taxpayers to participate in relief programme as deadline looms
The Namibia Revenue Agency (NamRA) in a newsletter urged taxpayers with outstanding tax amounts to participate in the Electronic Filing Tax Relief Programme, which is set to end on 31 January 2022. The relief provides for the waiver of 100% of penalties and 75% of interests on the settlement of the capital outstanding tax amount. The relief was initiated to assist taxpayers who found it difficult to settle their outstanding tax debts, especially businesses that were affected by the COVID-19 pandemic. Some individual taxpayers were also finding it hard to clear their dues as COVID-19 negatively affected our economy at all levels. As of 30 November 2021, 264 710 taxpayers owed NamRA over NAD162-billion in capital tax debt. Close to NAD8-billion and over NAD265-million in penalties and interest, respectively, were waived, which was owed by around 23 000 businesses and more than 11 000 individual taxpayers who participated in the relief between January and November 2021. NamRA further noted participants are required to register as e-filers and must first file tax returns on the Integrated Tax Administration System (ITAS) and then pay the capital outstanding amount to qualify for the relief.
Source: Namibia Economist
NigeriaZungeru Dam to be commissioned in four phases from the first quarter of 2022
The Chinese company Sinohydro will commission the Zungeru hydroelectric plant in four phases in the first quarter of 2022. With a capacity of 700 MW, Zungeru will be the second largest hydroelectric scheme in Nigeria. The construction of the Zungeru hydroelectric dam will be completed in 2022. The Chinese company in charge of setting up the hydroelectric scheme says its power plant will be commissioned in four phases during 2022. The first unit of the power plant, equipped with a 175 MW turbine, will be commissioned in the first quarter. The other three turbines will be commissioned in the second, third and fourth quarters of 2022, for an installed capacity of 700 MW. This will be the culmination of a mega-project whose construction phase began in 2013. On the project site, work is 95% complete. But everything will be ready for the commissioning of the first turbine in a few weeks, assures Li Xiao Ming, the deputy director of the project.
Source: AFRIK 21
RwandaLow uptake of renewable energy loans could hamper solar energy uptake
Low utilisation of Renewable Energy Fund (REF) loans has slowed the pace of scaling up solar energy in rural areas despite an increase that has been recorded in recent years according to the Development Bank of Rwanda (BRD). The fund is a joint project of the World Bank and the Rwandan government which was launched in 2017 with the aim to supply 445 000 off-grid systems and benefit an estimated 1.8 million Rwandans of whom 52% are women by the end of 2023. The USD48.9-million fund provides on-lending through SACCOs, commercial banks to households, Enterprises and Off-grid Solar Companies (OSCs), direct financing of mini-grid developers and direct loan financing to locally-registered OSCs. The products were designed to address affordability of solar home systems which the lower-income population and solar companies identified as a key hindrance. However, since its establishment in 2017, only 6% of REF loans had been exploited by 2020 and the experts attributed the low uptake of the loans among the intended beneficiaries in the rural areas to issues of affordability of solar systems, limited collaterals for loans and weak marketing.
Source: The New Times
TanzaniaDar’s EAC trade surplus reaches USD485-million, but still less than half of SADC volumes
Tanzania’s trade surplus across the East African Community (EAC) region rose to USD484.5-million in 2020, from USD343.8-million the previous year, according to latest updated central bank figures. The country also reported a highly-improved trade surplus of USD1.09-billion with Southern Africa Development Community (SADC) countries, indicating a further expansion of its sub-Saharan trade network. Kenya remained Tanzania’s main trading partner within the EAC bloc, accounting for 28.4% of intra-EAC exports and 76.4% of imports in 2020. Export figures to Rwanda, Uganda and Burundi also rose sharply while imports from those countries dwindled. According to the Bank of Tanzania’s 2020/2021 Annual Report released on 31 December, Tanzania exported goods worth USD811.2-million to the EAC region in 2020, up from USD678.5-million in the previous year, while imports from the bloc declined slightly from USD334.7-million to USD326.7-million. Exports to Kenya were valued at USD230-million in total against USD249.6-million of imports.
Source: The EastAfrican
TanzaniaTanzanian ports increase cargo by 10.7%
With the continuing global economic recovery, Tanzanian ports’ performance rebounded in the third-quarter of 2021 with cargo handling through lake and sea ports going up by 10.7%. According to the Bank of Tanzania (BoT), the cargo volumes totalled 4.677 million tonnes, a significant increase from the 4.226 million tonnes handled in the corresponding period in 2020. Dar es Salaam port, which holds the largest share, cleared 4.400 million tonnes of cargo compared with 3.9 million tonnes of cargo handled in the similar period in 2020. The performance reveals an unprecedented year with the COVID-19 pandemic having huge impact on ports across the globe. “The performance of Dar es Salaam port was partly due to expansion of berths and dredging of the entrance channel, together with efforts made by the government to attract neighbouring countries to use the port,” said BoT in its Consolidated Zonal Economic Performance report. Speaking to The Citizen, the Tanzania Ports Authority director general, Eric Hamissi, said deliberate efforts are being made by the government to invest in port handling equipment, which has increased efficiency and effectiveness.
Source: The Citizen
UgandaInsurance industry sees positive growth amidst COVID-19
Uganda’s insurance industry is projected to register consistent growth in 2022 riding on technology innovations, government’s investment in infrastructure and increased economic activities as the economy opens up. Ibrahim Kaddunabbi Lubega, CEO at the Insurance Regulatory Authority (IRA) told The Independent on 7 January that the projection is premised on a fairly impressive performance in 2021 where the industry is estimated to have grown at about 11% amidst several disruptions. He said the COVID-19 pandemic seems to have improved the risk awareness among the public as demonstrated by renewed interest in insurance by small, medium and large-scale enterprises. “The insurance industry players have [also] continued to adopt technology,” he said. “We anticipate that going forward, the entire insurance cycle right from underwriting through policy issue, claims intimation up to claims payment will be largely enabled by technology.” Kaddunabbi said the regulator has also developed and issued guidelines for sandboxes to enable budding innovators test some of their innovative solutions before they can be rolled out into the market.
Source: The Independent
UgandaUganda tax body struggles to hit targets
With the half year revenue collection calendar already elapsed, the Uganda Revenue Authority (URA) is still behind in its domestic revenue collection targets of slightly more than USD6.17-billion. The ongoing COVID-19 pandemic has complicated the situation, and tax experts, economists and policy analysts now say there is no guarantee that the URA will hit its target by the end of the financial year in June. By close of the 2020/21 financial year six months ago, the URA had collected USD5.39-billion in net revenue and posted a 14% growth in comparison to the previous period, an estimated tax-to-GDP ratio of 12.99%. In real terms, this reflects a revenue growth of USD702.14-million, although it missed the target by USD645.9-million, the taxman said while releasing the revenue performance for the 2020/21 financial year and the outlook for 2021/22. According to the half-year revenue performance report for 2021/2022, about 71% of the revenue was generated from the top four sectors of the economy, with the wholesale and retail trade sector registering the biggest contribution of USD1.6-billion (29.43%).
Source: The EastAfrican
ZambiaZambian companies seek deals in Dubai
Zambian companies are participating in a business exposition that has provided a platform for the country to market its investment opportunities in priority places like Dubai. President Hakainde Hichilema is expected to grace the Zambia National Day on 20 January 2022 at the ongoing Expo 2020 Dubai. Ministry of Information and Media Permanent Secretary Kennedy Kalunga says government is happy with the enthusiasm shown by Zambian investors to participate in the expo, which started on 1 October last year and is expected to run up to 31 March 2022 under the theme ‘Connecting the future’. Addressing a press briefing, Mr Kalunga said the expo will provide opportunities to look at how advanced and emerging economies can work together and build new bridges to foster balanced and equitable growth. “The expo will serve as a platform for the country to market its investment opportunities in the priority sectors of the economy such as tourism, agriculture, manufacturing, energy and construction,” he said. Mr Kalunga, who is the chairperson of the Publicity Committee, said the event will provide an opportunity for business networking to develop best strategies towards improving competitiveness and effective integration.
Source: Zambia Daily
ZimbabweZimbabwe slashes trade deficit as exports rise by 20%
Zimbabwe managed to significantly cut its trade deficit towards the end of 2021 after it registered an increase in the value of its exports and a decrease in the value of its imports. According to the Zimbabwe National Statistical Agency (ZIMSTAT), the trade deficit went down from USD177-million in October to USD36-million in November on the back of a 20.93% rise in exports and a 4.07% decrease in imports. A narrowing of the trade deficit means Zimbabwe was able to retain a sizable amount of physical United States dollar bills in the economy. The major contributors to the rise in exports were food and beverages and transport equipment which were valued at USD19.7-million and USD2.84-million, respectively. The leading export commodity over the course of this period was semi-manufactured gold which accounted for almost a third (32.8%) of total exports, followed by nickel, mattes, ores and concentrates which accounted for 29.8% and then tobacco at 13.1%. On the other hand, the Southern African country’s leading imports were fuels at 16.1%, machinery at 14.5% and vehicles at 7.7%.