Author: Jack Oduor

• Bankers in Kenya are grappling with record 18-year high loan defaults due to high interest rates and a tough business environment.
• Central Bank of Kenya Governor Dr. Kamau Thugge says that despite the rise in bad loans, the banking sector remains stable and resilient
• The overall balance of payments is projected to be a surplus of $554 million in 2024 which should result in a reserves buildup of $1,920 million

The rate of loan defaults in Kenya has hit records last seen over 18 years ago as the fiscal policies meant to cushion the country from high inflation take a toll on the banking industry.

Latest industry data by Central Bank of Kenya shows that the ratio of gross non-performing loans (NPLs) to gross loans stood at 16.7 per cent in August 2024 compared to 16.3 per cent two months earlier.

Essentially this means that out of every Sh100 shillings …

• Kenya and the IMF talks on a new loan are making “significant progress,” Central Bank Governor has revealed.
• The country eyes about $487.2 million (Sh62.9 billion) under the IMF’s Extended Fund Facility (EFF) and Extended Credit Facility (ECF)​.
• Completing the second review under the Resilience and Sustainability Facility (RSF), approved on July 17, 2023, will provide another $120 million to Kenya.

Kenya will receive a loan of up to $1.61 billion (Sh209.3billion) from the International Monetary Fund (IMF) in December to back up the governments reserves, the Central Bank of Kenya has revealed.

This is after the government and IMF agreed to combine the seventh and eighth reviews which will raise the government access to $1.61 billion, increasing the country’s reserves to $1.9 billion (Sh245 billion) by the close of the year.

CBK Governor Dr. Kamau Thugge has confirmed that discussions with the IMF are nearing completion. The talks, have …

• Handcraft artisans in Kenya have over the years been exploited by profit-sapping middlemen who set prices for them.
• According to the Kenya Economic Survey Report 2023, the Jua Kali sector contributed 25% of the GDP, a similar contribution rate to that of agriculture.
• One of the challenges that the engagement is looking to address is the disparity in pricing for similar products, depending on where they are made.

Technology and education are transforming the lives of Kenyan handmade craft artisans, offering new opportunities for growth, sustainability, and global market access. Artisans, who traditionally relied on local markets and limited resources, are now tapping into digital platforms and skill-building programs to expand their reach and improve their livelihoods.

The integration of tech solutions, including e-commerce platforms, social media marketing, and digital payment systems, has enabled artisans to showcase their products beyond Kenya’s borders.

Platforms such as Etsy, Facebook, and Instagram are …

• Kenya has unveiled  a plan to help MSMEs meet international export standards.
• Through the plan, Kenyan will be able to secure necessary product certifications for easier entry into foreign markets.
• Kenya plans to send over 300 MSMEs to the trade fair, focusing on presenting high-quality, export-ready products.

Kenya’s Ministry of Co-operatives and Micro, Small and Medium Enterprises has launched a new initiative aimed at enhancing regional trade and improving the export competitiveness of high-potential products. This program seeks to address existing supply gaps in global markets and help local businesses tap into higher price segments.

The initiative will include boosting the readiness and organisation among Micro, Small, and Medium Enterprises (MSMEs) to meet strict international quality and quantity export standards.

The Cabinet Secretary for Cooperatives and MSMEs Wycliffe Oparanya said that through the plan, Kenya will be able to secure necessary product certifications for easier entry into foreign markets.

“Central …

• Kenya’s rising debt obligations have failed to reduce the debt that currently stands at about $82.2 billion.
• Service costs went up from 58% after the government paid $2 billion Eurobond.
• Sovereign bond-holders accounted for $6.6 billion of the external public debt stock.

The National Treasury has laid bare the pain awaiting Kenyans in repaying loans borrowed from external lenders and domestically. Fresh data tabled in Parliament reveals that taxpayers will dig deeper in their pockets in the next financial years to repay loan obligations.

Details show that for every $0.78) Sh100 the government collects, $0.53 (Sh68) goes to servicing the $82.2 billion (Sh10.6 trillion) debt pile reported as of June 30, 2024. The treasury revealed that the country’s debt stock increased by $2.3 billion (Sh303 billion) compared in the year ended June 2024 compared to a year ealier. Currently, Kenya’s debt stock is projected to hit $100.7 billion (Sh13 trillion) …

• Kenya’s rose flower exports face increased scrutiny in the EU despite the market remaining the top destination for fresh produce.
• Kephis says that the EU has imposed stricter guidelines for flower exports.
• In addition to roses, capsicum has also seen a rise in interceptions, with seven cases in 2023 compared to zero in 2020.

Heightened scrutiny for Kenya’s rose exports

Kenya’s flower export industry, particularly its rose exports, is facing heightened scrutiny from the European Union (EU) as interceptions of shipments due to pest concerns have significantly increased. 2023 there were 37 interceptions on roses, nearly doubling the 21 interceptions reported the previous year.

This rise is a cause for concern, especially since Kenya is the world’s leading exporter of roses, making the stakes even higher for the industry. Kenya Plant Health Inspectorate Service (KEPHIS) says that the EU has imposed stricter guidelines for flower exports, particularly for pests like …

• Mastercard Gateway is a global payment platform that offers protection from fraud and simplifies payment acceptance.
• The main forces behind this change are the speed, security, and ease of use provided by digital wallets and mobile money.
• Mobile money services like MTN Mobile Money, Airtel Money, and Kenya’s M-Pesa are becoming to become well-known brands.

Mastercard and Amazon Payment Services have entered a multi-year partnership to digitize payment acceptance across key markets in the Middle East and Africa.

The agreement includes Bahrain, Egypt, Jordan, Kuwait, Lebanon, Oman, Qatar, South Africa, and the UAE.

Through the partnership, Amazon Payment Services will integrate Mastercard Gateway, a streamlined solution for payment processing, across 40 markets in the region.

This integration will allow merchants to provide faster, more secure transactions and various payment options for customers.

The collaboration comes as digital payments continue to rise in the region. Amazon Payment Services merchants, including Amazon …

• Ransomware attacks cost the healthcare sector $2.57M, with only 22% of ransomware victims fully recovered in a week or less.
• Organizations with breached backups were twice as likely to pay the ransom to recover encrypted data.
• Insurance providers play a significant role in these ransom payments, contributing to 77% of cases and covering 19% of the total ransom amounts.

Cyber-attacks targeted towards health organisations have increased by 7 per cent in the past year to hit a four-year high since 2021. New findings titled “The State of Ransomware in Healthcare 2024,” by cybersecurity firm Sophos, reveal that healthcare is reporting a rise while other sectors posted a drop.

Of those organizations surveyed, two-thirds or 67 per cent were impacted by ransomware attacks in the past year, up from 60 per cent in 2023.

The rising rate of ransomware attacks against healthcare institutions contrasts with the declining rate of ransomware attacks …

• Kenya’s private equity deals size are expected to remain modest this year.
• However, despite the high optimism, deal sizes in East Africa are expected to remain modest.
• However, businesses are concerned that firms will be scouting for exits, too.

Kenya and its East Africa peers are confident that the fundraising environment for businesses will continue improving in the next 12 months even as the continent experiences mixed expectations.

New findings by Audit firm Deloitte show that while East and West Africans largely anticipate an improvement, opinions in North and Southern Africa are divided, with some expecting improvements, others predicting stagnation, and some foreseeing deterioration.

This outlook comes against the backdrop of persistent high interest rates, inflation, and geopolitical uncertainty, which led to a 9 per cent drop in finalized funds year-on-year in 2023.

The Deloitte Africa Private Equity Confidence Survey 2024, shows that in East Africa, optimism is on …

• Kenya’s fertilizer distribution reforms were introduced by Ruto’s administration when it ascended to power.
• Fertilizer consumption in Kenya averaged 59 kilos per hectare of arable land between 2017 and 2021
• AGRA says the disruption in the supply chain has forced SME agro dealers to cease operations, leading to a dysfunctional fertilizer distribution system.

Kenya’s fertilizer distribution reforms have led to a 20.5 per cent drop in the country’s fertiliser usage, new findings by the AGRA show.

The organisation, formerly known as the Alliance for Green Revolution, in its Africa Agriculture Status Report 2024 points out that the government led changes have seen consumption drop from 835,000 tonnes in 2020 to 663,400 tonnes in 2022, with further declines anticipated in 2023 farming season.

According to data from the World Bank, fertilizer consumption in Kenya averaged 59 kg per hectare of arable land between 2017 and 2021, with per capita consumption increasing …