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issue 441 | 27 Mar 2022

Africa

Cellulant, UBA to expand payments in 19 African countries

Cellulant and United Bank for Africa (UBA) Plc have announced a partnership that will extend payment services for merchants and consumers across 19 key African countries where UBA operates. The countries are Nigeria, Ghana, Kenya, Côte d’Ivoire, Zambia, Tanzania, Uganda, Benin, Burkina Faso, Cameroon, Chad, Congo, the Democratic Republic of the Congo, Gabon, Guinea, Liberia, Mozambique, Sierra Leone and Senegal. This network represents one of the primary tools in bringing together Africa’s fragmented payments ecosystem, ensuring Cellulant’s payment gateway, Tingg, is available to a vast number of merchants and consumers in each of these markets. Already, over USD15-billion in gross value payments are processed by Cellulant across the shared markets – and this partnership has the scope to expand the numbers significantly. “We are delighted to welcome [UBA] as a new banking partner,” said Group CEO at Cellulant, Akshay Grover.

Source: The Guardian

East / Central Africa

KCB triples dividend after profit jump, targets DRC

Listed lender KCB has tripled its dividend payout to KES9.64-billion for the year ended December 2021, while retaining KES24.5-billion to finance new acquisitions and grow its business in Rwanda and Kenya. The bank reported a 74% jump to KES34.09-billion in net earnings for the year, driven by lower provisions for bad debts and higher income from loans. KCB declared a final dividend of KES2 per share, or KES6.43-billion, bringing the total shareholder payout to KES3 a piece or a cumulative KES9.64-billion. The lender had paid an interim dividend of KES1 in January. The dividend is equivalent to 28% of the bank’s new earnings, up from 16.4% last year but lower than the 43% it paid in 2019. KCB Group chief executive Joshua Oigara said that the lender sought to strike a balance between rewarding shareholders while preserving cash to weather geopolitical risks and supporting growth through new investments, including a potential entry into the Democratic Republic of the Congo (DRC) market. “We have increased our dividend three-fold and it is well within our ambition this year. But as you go forward into next year, you do expect that dividends should go to 45% of our total earnings, which is what we have done before,” said Mr Oigara.

Source: Business Daily

East Africa

EAC reviews Common Market Protocol ahead of DRC entry

The East African Community (EAC) is reviewing the Common Market Protocol to allow a smooth entry of the Democratic Republic of the Congo (DRC) and spur intra-regional trade, which has stagnated at around 15%. The bloc’s highest decision-making organ, the Heads of State Summit, will review the protocol at the High-Level Summit Retreat on the Common Market before this year’s summit in April. EAC secretary-general Dr Peter Mathuki confirmed the plan. The Common Market was adopted in 2009 and entered into force on 1 July 2010, with the aim of boosting the growth of the EAC through free movement of goods, services, labour and capital. Its introduction five years after the first pillar, the Customs Union (2005), required that it combine the region’s economies, create opportunities for the private sector and increase competitiveness. But, 11 years on, its requirements have been hampered by tariff and non-tariff barriers, red tape and non-compliance by partner states. The other pillars, the Monetary Union and the Political Federation, are at various stages of implementation. Now, with the expected entry of mineral and natural resource-rich DRC, which comes with a population of over 90 million people, Kinshasa offers a fertile consumer market and an important investment destination.

Source: The EastAfrican

Democratic Republic of the Congo

DRC to join EAC soon

The Democratic Republic of the Congo (DRC) will officially be admitted to the East Africa Community (EAC) soon, adding a 90 million market for the bloc. The EAC secretary-general Dr Peter Mathuki, in a letter to ministers in charge of the EAC docket in member states, confirmed that the heads of state would approve the admission on 29 March. “We are in receipt of a letter dated 18 March from the chairperson of the Council of Ministers informing the secretariat of the convening of an extraordinary summit on the admission of the DRC into the EAC on 29 March 2022,” said Dr Mathuki. The proposed agenda for the summit will be the consideration of the report of the council on the admission of the DRC into the EAC.” Kenya’s President Uhuru Kenyatta, who is the current chair of the EAC, is expected to preside over the summit that also includes President Samia Suluhu Hassan (Tanzania), Yoweri Kaguta Museveni (Uganda), Paul Kagame (Rwanda), Evariste Ndayishimiye (Burundi) and Salva Kiir of South Sudan. 

Source: The Citizen

Ethiopia

Chinese investments in Ethiopia will be further reinforced

Chinese investment projects in Ethiopia will be further strengthened, Ambassador Zhao Zhiyuan said. A delegation led by Chinese Ambassador to Ethiopia, Zhao Zhiyuan, held discussions with the Chief Administrator of Amhara Regional State, Yilkal Kefale in Bahirdar recently. On the occasion, the ambassador said currently, many Chinese companies are engaged in the region in various investment sectors by allocating capital in areas of agriculture, manufacturing, construction and industries, among others. China understands that Amhara region is one of the regional states in Ethiopia with immense potential for development, Ambassador Zhiyuan noted, affirming the continuation of ongoing investment activities in the region. The ambassador also urged the regional state to promote the existing investment opportunities by identifying vital development areas.

Source: ENA

Kenya

Insurance compensation limit to increase on review

The government wants to increase the payout to policyholders of collapsed insurance companies from the current KES250 000. Policy Compensation Fund (PCF) managing trustee William Masita said the fund will conduct a study to determine the new payout which could go to as high as KES400 000 per customer. The fund, whose resources had grown to KES15-billion as at December 2020, is currently compensating policyholders of Concord Insurance and Standard Assurance which collapsed years ago under the current rates. “We plan to do an actuarial study in the next financial year and also to determine the sufficiency of the maximum amount we can pay,” Mr Masita said. “It would possibly result in an upward review of the amount because of inflation. I would not give a number to it, [but] only to give an example, from the banking sector [it] is at KES500 000 so any range between KES250 000 and KES400 000.” Policyholders contribute 0.25% of their premiums to the compensation fund which is matched by their insurance companies.

Source: Business Daily

Kenya

Kenya’s central bank warns of risks in cryptos

The Central Bank of Kenya (CBK) says it still does not support cryptocurrency transactions due to the risks involved even as such dealings increase. According to CBK governor, Patrick Njoroge, Kenyans should avoid peer-to-peer (P2P) cryptocurrency transactions since they are not regulated. “There are people who are excited about cryptocurrencies because they see it as a sort of investment that they can win big because prices are going up quickly, so they believe they would see a huge return for their investment. But I think that is why we say for every person who wins something, there are hundreds who lose,” said Njoroge. Speaking in Mombasa during World Consumer Rights Celebration Day 2022 recently, Njoroge added that financial institutions supporting such transactions risk losing their licences. “Few years back, we had issued a warning to all Kenyans and even people beyond our borders that we were seeing significant risk from cryptocurrencies, not because it was unregulated but because of services it was supporting, majority which were illegal transactions,” said the governor.

Source: The EastAfrican

Kenya

Treasury releases new Vision 2030 projects guidelines

National projects valued at KES5-billion and below will be struck off from the list of flagship projects under the Vision 2030 plan under new guidelines issued by the Treasury. Treasury Cabinet Secretary Ukur Yatani says a flagship project should have a direct impact on at least five socio-economic sectors and a favourable return on investment. Mr Yatani said his ministry will vet and approve projects seeking to attain the status of Kenya Vision 2030 Flagship Programmes/Projects before their inclusion in the Medium-Term Plans and sector plans. “A flagship project should have wide geographical spread, directly benefit at least 50 000 households or 200 000 persons through improved service delivery, income generation and employment creation,” Mr Yatani said in the circular. At the county level, projects should be valued at least KES500-million and above to qualify. The number of flagship projects has steadily increased from the initial 93 as identified in the Vision 2030 blueprint to 216. “With the increase in the number of flagship programmes and projects, the scarcely available financial resources have continuously been thinly spread leading to low completion rates and or stalling of projects,” the circular dated February 2022 adds.

Source: Business Daily

Malawi

COMESA boss tips Malawi over TFTAA ratification

Common Market for Eastern and Southern Africa (COMESA) secretary general Chileshe Kapwepwe has urged Malawi to expedite the process of ratifying the Tripartite Free Trade Area Agreement (TFTAA). The trade agreement will facilitate free movement of goods, services and businesspersons among COMESA member states in a quest to stimulate economic activities. Zambia ratified the agreement last year, but 14 endorsements are needed to enforce it. So far, 11 countries have ratified the agreement, which brings together 28 countries with a population of over 700 million and a combined gross domestic product of USD1.4-trillion. Ms Kapwepwe said Malawi signed the agreement on 10 June 2015 but has not completed the ratification process. “We were informed that the ratification process was expected to be completed before the end of 2020 but there are some delays.

Source: Zambia Daily Mail

Malawi

Government moves to reduce burnt bricks’ use

The government has embarked on a path to reduce the use of burnt bricks in the construction industry with the aim of promoting the use of sustainable, environment-friendly and energy-efficient construction materials. Vice President Saulos Chilima said this recently when he launched the MWK30-billion Limestone Calcined Clay Cement (LC3) Project, which is part of the public-private partnership (PPP) promotion that seeks to promote the use of environment-friendly building materials in the construction sector. Under the project, Lafarge Cement Malawi will use Limestone Calcined Clay Cement while Terrastone Limited will be using Cold Ceramic Brick Technology. “These projects will reduce the negative environmental impact and instead allow us to substitute resources scarce to Malawi with other raw materials that are in abundant supply and readily available in the country. “In the case of the partnership with Lafarge, the cement production technology currently used will be replaced with the Limestone Calcined Clay Cement technology. This will mean reducing Lafarge’s carbon dioxide emissions by 10 000 tonnes annually. We expect that this will inspire the whole construction sector to operate more efficiently,” Chilima said.

Source: The Times

Malawi

Vandalism costs ESCOM MWK2-billion

Energy Minister Ibrahim Matola says the country needs MWK2-billion to replace Electricity Supply Corporation of Malawi (ESCOM) transformers that have been vandalised. Matola was unpacking President Lazarus Chakwera’s State of the Nation Address on the energy sector in Lilongwe recently. The minister says the country is in a crisis due to the vandalism of transformers, adding that about 70% of the equipment has been damaged. “The rate at which vandalism is happening is high and a cause for concern, economic-wise, not just to ESCOM but the country’s development. Just imagine; 146 transformers have been vandalised in the Southern Region, especially in Mulanje and Thyolo districts; 91 in the Central Region and 13 in the Northern Region,” Matola said. At the news conference, co-addressed by Information and Digitisation Minister Gospel Kazako, Matola said the development had affected implementation of the Malawi Rural Electrification Programme (MAREP) because ESCOM was now replacing vandalised transformers using transformers that were meant for the programme. Currently, he said ESCOM has replaced 150 transformers with those from MAREP, in the process delaying the connection of one million people to the power grid.

Source: The Times

Mozambique

Tax authority launches the Portal do Contribuinte

The new tax payment system in operation in Mozambique – www.portaldocontribuinte.at.gov.mz – officially launched by the tax authority on Tuesday, 22 March, aims to ensure fiscal transparency, facilitate taxpayer mobility and reduce corruption in the sector. Long queues to pay taxes, system failures and illicit collections, which caused taxpayers lengthy delays at posts across the country, may soon be a thing of the past. Recently, the Taxpayer Portal (Portal do Contribuinte) came into operation. The Mozambican Tax Authority formally launched the system. President of the Mozambican Tax Authority Amélia Muendane noted that, in this first phase, the Taxpayer Portal will include the administration of value added tax (VAT) and simplified small taxpayers taxes (ISPC), ensuring remote “registration of taxpayers, submission of VAT and ISPC declarations, management of the taxpayer’s current account, request for the discharge certificate, consultation relating to the tax status of the taxpayer and simulation of tax calculations.” 

Source: Club of Mozambique

Rwanda

Nyamata Centre for Infectious Diseases to help country tackle future epidemics

The COVID-19 pandemic has shown Rwanda the necessity of investing in pandemic preparedness and strengthening national capacity to deal with current, future, sudden and catastrophic public health threats. Following the lessons learned, the government of Rwanda, with the help of the Global Fund and the World Bank, has established Nyamata Emerging Infectious Diseases (EID) Centre to help effectively and sustainably deal with current and future EID of greater public health concern. The centre is a sort of “mobile field hospital” built in the District of Bugesera and located close to Nyamata District Hospital. It is currently serving as the national COVID-19 isolation and treatment centre. According to Zachee Lyakaremye, the Permanent Secretary in the Ministry of Health, the centre will also give services that include surgery operations, critical care, delivery and hospitalisation, among others. He noted that in the case that COVID-19 will no longer be a huge problem to the country, the facility will assist Nyamata District Hospital in providing medical services since it has equipment that cannot be found at any other hospital. The centre is worth USD6.41-million investment, co-financed by the government of Rwanda, the Global Fund and the World Bank. 

Source: The New Times

Rwanda

Rwanda to raise public spending to spur economic recovery

Rwanda is adjusting its public spending to accelerate economic recovery from the COVID-19 effects – characterised by job losses, disruption in international travels and global supply chains. Prime Minister Edouard Ngirente announced the development during a recent media briefing in which he shed light on the government’s response towards inflationary pressures and developments in the current economic recovery process. Under the new plan, the government will inject an extra RWF150-billion in the Economic Recovery Fund (ERF), adding to the initial RWF100-billion, Ngirente disclosed. Increased spending also comes with reforms to the ERF – a policy response which was unleashed two years ago to support COVID-19-affected businesses. “There have also been some adjustments to the facility because initially we were still in COVID-19 times which deterred accessibility to some businesses and also awareness… but we look to improve both,” said Ngirente. Ngirente added that the ERF which has contributed towards subsidising transport costs, is among the interventions that have been key in Rwanda’s recovery process. For instance, he said that one of the other interventions made is the “Manufacture and Build to Recover Program” under which 38 industries are to kick start operations in the next two years.

Source: The New Times

Tanzania

Investors now to obtain permits within seven days

Foreign and local investors will from 1 July this year be able to obtain all the necessary permits within seven working days, down from the current 14, The Citizen has learnt. This follows the government’s decision to cut red tape in investment by establishing the Tanzania Electronic Investment Window (TeIW), whose development began last December. The system is being developed in phases, whereby the first phase will bring under a single window seven government institutions, including the Tanzania Investment Centre (TIC), National Identification Authority (NIDA), and Tanzania Revenue Authority (TRA). Others are the Business Registration and Licensing Agency (BRELA), Immigration, Labour Office, and the Land ministry. Investment, Industry and Trade Permanent Secretary Godius Kahyarara told The Citizen that the first phase, which will address bureaucracy in the issuance of investment permits, was 70% complete. “We are in the final stages of finalising this game-changing initiative. TeIW is set for completion in April, ready for testing, before becoming fully operational on 1 July 2022,” he said via WhatsApp.

Source: The Citizen

Uganda

European Union renews efforts to grow Ugandan export

The European Union (EU)and the Private Sector Foundation Uganda (PSFU) have revived the Sustainable Business for Uganda (SB4U), a trade improvement initiative that was disrupted by the COVID-19 outbreak, one year after its launch. The platform launched in 2019 is aimed at enabling Uganda’s export sector to fully take advantage of the existing trade initiatives, like “Everything but Arms (EBA)”, which allows Uganda to export to Europe free of tariffs and quotas. Uganda’s exports comprise mainly of agricultural products like coffee, fruits and vegetables, flowers, fish and fish products, while the country’s import earnings are from the energy, construction, agro-processing and tourism sectors, among others. The exports were recorded at USD500-million in 2020, compared to the imports from the region worth USD699-million. The EU Head of Delegation to Uganda Ambassador Attilio Pacifici, says there are many items that Europe needs from Uganda which would raise the export earning to beyond USD1-billion, but Ugandans are not usually aware of what the market demands. For this reason, the EU has set aside EUR170-million for the next four years to facilitate sustainable investment, economic enablers and connectivity, skilling and decent jobs.

Source: The Independent

Zambia

COMESA concerned with marginalisation of the fish industry

The Common Market for Eastern and Southern Africa (COMESA) has expressed concern with the continued marginalisation of the fisheries industry in the Eastern Africa (EA), Southern Africa (SA) and Indian Ocean (IO) regions. COMESA assistant secretary-general, Programmes, Kipyego Cheluget, says the fisheries sector is one of the fastest growing industries as fish and fish products are one of the most widely traded food commodities due to their nutritional and economic benefits. Dr Cheluget however, noted that despite the significant role that the sector plays, especially to small-scale fisheries and contribution to global poverty reduction, the sector has not attracted much attention from national and global policies. The ECOFISH programme is a EUR28-million European Union sponsored programme aimed at promoting equitable economic growth of sustainable fisheries in EA, SA and IO regions. Dr Cheluget said this is why COMESA will support its member states to implement their blue economy strategies in attaining sustainable development of the fisheries industry through programmes like the ECOFISH which is designed to create awareness and address challenges in the sector.

Source: Lusakatimes

Zambia

Mutati changes composition of ZICTA board

Technology and Science Minister Felix Mutati has signed a Statutory Instrument (SI) to reconstitute the composition of the Zambia Information and Communications Technology Authority (ZICTA) board and clearly define its role and that of the ZICTA director general. Mr Mutati says the reconstitution means the shape of the new ZICTA board will be different from the existing one and therefore, the existing one falls away as it has been dissolved. “With this new SI, instead of having eight institutions sitting on the ZICTA board, it will be reduced to only four, and while the minister was mandated to appoint one person, he will be able to appoint five individuals to sit on the board based on their knowledge and experience,” Mr Mutati said. Mr Mutati said the mandate of ZICTA has also been expanded following the new licensing framework designed to, among other things, drive investment in the information and communications technology sector, focusing on broadband connectivity and ensuring that internet penetration exceeds the current levels at 57% and to make Zambia a digital hub. 

Source: Lusakatimes

Zimbabwe

IMF Executive Board concludes 2022 Article IV Consultation with Zimbabwe

The Executive Board of the International Monetary Fund (IMF) concluded the Article IV Consultation with Zimbabwe on 21 March 2022. Zimbabwe experienced severe exogenous shocks (cyclone Idai, protracted drought, and the COVID-19 pandemic) during 2019-20, which along with policy missteps in 2019, led to a deep recession and high inflation. Real GDP contracted cumulatively by 11.7% during 2019-20. Real GDP rose by 6.3% in 2021 reflecting a bumper maize harvest, strong pickup in mining, and buoyant construction. A tighter policy stance since mid-2020 (relative to 2019) has contributed to lowering inflation to 60.7% year-on-year at end-2021. The output recovery that resumed in 2021 is expected to continue, albeit at a slower pace, with growth projected at about 3.5% in 2022 and 3% over the medium term in line with Zimbabwe’s growth potential. The authorities aim to limit the 2022 budget deficit at 1.5% of GDP, and below 2% of GDP over the medium-term. At the same time, the current account surplus is expected to decline over the medium term, reflecting a pickup in imports and slowdown in remittances. The effects from the COVID-19 pandemic and protracted drought have compounded existing structural constraints and would lead to scarring on the economic outlook.

Source: IMF