Author: Kang'ethe Njoroge

• Civil unrest, electricity crisis and natural disasters in South Africa deal a body blow to the regional economy growth prospects.
• The 2023 Southern Africa Economic Outlook indicates that the Southern Africa region’s GDP growth barely reached 2.7 percent. This level is much lower than global and African averages of 3.4 percent and 3.8 percent respectively.
• According to the African Development Bank, Southern Africa region is now lagging behind its peers across the continent. 

The Southern Africa zone has continued to experience a slowdown in economic growth in the past year largely driven by increasing challenges in regional powerhouse South Africa. 

The south-most country on the continent has seen civil unrest, electricity crisis and natural  disasters worsen the region’s economic slowdown. Neighbouring Zimbabwe, Zambia, Malawi, Madagascar, and São Tomé and Príncipe, have also experienced intense adverse weather events.

According to a report by the African Development Bank, climate change-related crisis has …

• Kenya’s tech industry regulator says Kenyan startups have the potential to drive up to 70 percent of Kenya’s digital transformation.
• However, latest data shows about eight out of 10 Kenyan startups tend to close shop within the first three years of operation.
• Communications Authority CEO Ezra Chiloba says by forming strategic partnerships, startups can receive valuable insights and support for growth.

Despite a majority of Kenyan startups failing to reach three years into operation since launch, stakeholders in the sector maintain that they are key to the country’s digital transition.

According to Ezra Chiloba, the CEO of industry regulator the Communications Authority, startups have the potential to drive up to 70 percent of Kenya’s digital transformation. However, many of them face significant obstacles such as funding and compliance constraints, leading to a high rate of closure within the first year.

Chiloba highlighted that around 80 percent of startups tend …

• To facilitate the execution of these projects, Afreximbank will collaborate with Arise IIP.
• In May, the lender rolled out a $3 billion program aimed at spurring Kenya’s economic growth.
• The plan will also include the establishment of the $600 million e-mobility manufacturing plant in Kenya.

African Export–Import Bank, popularly referred to as Afreximbank, has entered into an agreement with Kenya that will see the lender identify key economic projects that it will finance and manage.

Under the deal signed on May 2, 2023, Afreximbank, through its subsidiary, will conduct a comprehensive feasibility study on these proposed projects. It will them provide the necessary financing for their implementation.

One of the major focus of Afreximbank in Kenya is to provide funding for various special economic zones spread across different counties. The initiative is part of the broader industrial parks development and investment plan for Special Economic Zones (SEZs) in Africa.

“On …

• Kenyan landlords and property managers are losing up to 30 percent of their monthly revenue due to a lack of automation. 
• Most landlords lose revenue as they are unable to track and properly reconcile tenants’ payments from different channels.
• Additionally, landlords lose critical data including tenants statements, financial records, complaints, repair and maintenance data.

Automation in the lucrative housing business in Kenya is critical in plugging rent leakages. Sophia is a landlord in Kenya’s Mlolongo area, just a few kilometers from Nairobi’s Central Business District. Like many other landlords, she is constantly having to deal with reconciliation of payments every month. 

The advent of technology adoption in the country has seen the cropping up of different payment avenues including mobile money transfers, bank to bank transfers and the traditional cash payments. 

With a multitude of payment platforms today, it is easy for some cash to get lost or be unaccounted …

• About 60 per cent of employees in Sub-Saharan Africa are showing disconnection from their work.
• A big number of employees in Sub-Saharan Africa are turning to “quiet quitting” to express their job dissatisfaction.
• The affected individuals are more likely to experience stress and burnout due to their sense of being lost.

Sub-Saharan Africa leads the world with the highest number of most unhappy employees. The situation, largely referred to as “quiet quitting” is becoming prevalent among the majority of employees in Sub-Saharan Africa. Employees are turning to “quite quitting” as a means of expressing their dissatisfaction with their current jobs.

The worrying trend has resulted in Sub-Saharan Africa recording the highest regional percentage of employees who are actively looking for new job opportunities.

Most unhappy employees show least effort

According to the State of the Global Workplace 2023 report by Gallup, approximately 60 per cent of Sub-Saharan Africa’s employees are …

• Egypt has overtaken Nigeria by raising $540 million in tech startup funding in the year to June 2023.
• This year, Egypt achieved a major milestone by creating its first unicorn, MNT-Halan.
• In the year to June 2022, the Big Four—Nigeria, Kenya, South Africa and Egypt—jointly raised $4.6 billion. This was a 25 per cent drop from the $710 million raised previously. 

Egypt is today the leading market across Africa with total equity in tech funding raised by start-ups in the last one year surpassing rival Nigeria. Data from the African Private Equity and Venture Capital Association (AVCA) shows that the North African country overtook Nigeria as start-ups raised $540 million in funding in the year to June 2023. 

This was, however, a 25 per cent drop from the $710 million raised the previous year. The least decline recorded among the big four African countries …

• During the last quarter of 2022, the EAC hit an intra-trade value of $10.17 billion. This was a 20% proportion of intra-trade to world commerce.
• The revision of the EAC three-band structure aims at aligning the tariff rates.
• On July 1, 2022, the EAC enforced a new tariff structure that included a 35 percent duty on finished products imported into the region. 

The East African Community’s $18.9 million trade plan is facing obstacles as partner states seek preferential tax treatment under the bloc’s revised Common External Tariffs (CET).

This development is threatening to jeopardize the implementation of the proposed four-band tariff structure. On July 1, 2022, the EAC Secretariat enforced a new tariff structure that included a 35 percent duty on finished products imported into the region.

The secretariat, in a report from January 2022, highlighted the potential benefits of the fourth band, arguing that a maximum tariff of 35 …

• Kenyan water firms are seeking about $7.1 billion from the capital markets for various projects. 
• The initiative is a liaison between the Kenya Association of Stockbrokers & Investment Banks and the Eldoret Water and Sanitation Company.
• Traditionally, water service providers rely on tariffs, taxes, transfers, loans, bonds, and equity investments for funding.

Kenyan water firms have received the greenlight to secure fresh financing through the capital markets. Data shows that the utilities want to plug a funding shortfall of about $7.1 billion required for water projects.

The development comes following a collaboration between the Kenya Association of Stockbrokers and Investment Banks and the Eldoret Water and Sanitation Company.

KASIB and Eldoret Water and Sanitation Company partnership will establish alternative financing options through the bourse.  The deal paves the way for water companies in Kenya to explore ways of raising capital through the stock market.

Water funding shortage in Kenya

Overall, …

• Kenya National Oil Corporation CEO Gideon Morintat will lead talks on the untapped potential of East African energy market in October forum.
• With 1.4 billion barrels of recoverable crude oil reserves and significant gas resources, Uganda ranks among Africa’s fastest growing energy markets.
• In the renewables and power sectors, Uganda is diversifying energy mix by maximizing biomass, nuclear, solar and green hydrogen production.

Kenya’s oil and gas sector may be modest today, but stakeholders are joining forces to harness East Africa’s (EA) energy potential as significant discoveries across countries raise the stakes for investors.

At the upcoming African Energy Week (AEW), which will go on between October 16-20 in Cape Town, Leparan Gideon Morintat, the CEO of the Kenya National Oil Corporation (NOC), will lead discussions on the untapped potential of the East African energy market.

Engaging with a diverse range of investors and project developers, Morintat aims to attract …

• Despite the decrease in cargo demand, African airlines are expanding their capacity in comparison to 2022.
• European carriers and the Middle Eastern carriers experienced year-on-year decreases in cargo volumes in May 2023.
• On a global scale, there has been a decline of 5.2 percent in the demand for air cargo.

Cargo demand for African airlines has experienced a decline of 2.4 percent compared to May of the previous year due to weak demand stemming from rising inflation and the ongoing armed conflict in Sudan.

The International Air Transport Association (IATA) report for May 2023 on global air cargo markets indicates that despite the decrease in demand, African airlines have expanded their capacity in comparison to the previous year.

Furthermore, the report draws attention to a significant slowdown in the growth of the Africa to Asia trade route. The growth rate declined from 18.5 percent in April to 11 percent in …