Author: Martin Mwita

• Kenya is putting together incentives that could help mobilize Foreign Direct Investments in upstream oil activities.
• The latest developments add to efforts by the government to support Tullow Oil in scouting for investors for Project Oil Kenya.
• India and China are some of the countries where the government is keen on in tapping from.

In May 2023, an announcement by British oil explorer Tullow Oil that it wants out of Kenya’s oil dream send shockwaves in the industry as its move threatened to derail the country’s journey of becoming a net oil exporter.

At that moment, Tullow Oil partner, a Canadian firm Africa Oil Corp had left the project on concerns over difficulties in finding an investor, who can support Kenya’s commercial oil export business.

The other partner TotalEnergies is fast shifting investment focus to oil producing fields in other markets. For Kenya to evacuate its crude, it has to …

• Kenya’s inflation has eased for the second month in a row since hitting 8% in May.
• The drop in the cost of living came despite increased taxes on pump prices that is manifesting in higher transport costs.
• Previously, Central Bank Governor Kamau Thugge projected Kenya’s inflation to fall within the target band of 2.5% to 7.5% by October.

Kenya’s inflation eased in the month of July, going below the Central Bank of Kenya’s target range of between 2.5 per cent and 7.5 per cent for the first time in over a year. In the month under focus, Kenya’s inflation dropped to 7.3 per cent down from 7.9 per cent in June. The drop in the cost of living came despite increased taxes on pump prices that is manifesting in higher transport costs.

Consumer prices went up by 7.3 percent annually in July, marking the slowest rate in 14 months. This …

• Counterfeits and the informal alcohol industry is increasingly eating into EABL’s mainstream market.
• EABL net sales remained flat in the year at $769.5 million, impacted by thinning disposable incomes.
• Uganda and Tanzania top line performance up 17% and 1% respectively, while Kenya declined by 4%.
• EABL’s final dividend decreased by 50% from $0.077 paid in FY’22 to a total dividend of $0.039.

A tough macro environment in East Africa is to blame for subdued earnings posted by the East African Breweries (EABL) for the year ended June 2023. Higher excise taxes, rising cost of inputs and effects of the difficult macro-economic environment saw the regional brewer record mixed performance in Kenya, Tanzania and Uganda markets.

The Diageo–owned biggest manufacturer of branded beer, spirits, and non-alcoholic beverages in East Africa reported a 21 per cent drop in net profit for the year. The giant brewer said its sales for …

• Kenya is among countries that are heavily indebted with the loan stock at staggering 67.3 per cent of GDP.
• Total debt stood at $67.7 billion (Ksh9.6 trillion) as of April, Central Bank of Kenya data shows.
• This comprised $35.9 billion external debt and $24.6 billion borrowed from the domestic market.

President William Ruto is calling for “urgent” redesigning of global financial institutions to ensure fairness in financing of economies, as he continues to lash out at the West over debt traps in poor states.

In what seems to be a swing at the International Monetary Fund and the World Bank, Dr Ruto is pointing to a post-colonial Africa where development has stalled due to limited resources to liberate economies.

Lenders placing debt traps in poor States

This is from what Dr Ruto terms institutions that were extractive by design; only placing debt traps in poor states. Over the years, Kenya’s …

• The $100 million loan has been disbursed for onward lending.
• Coop Bank CEO says the funding “is most timely in view of the great need to better support our business customers.”
• The long-term tenure of the facility has significantly boosted Coop Bank’s ability to offer credit to SMEs.

The Co-operative Bank of Kenya has received a long-term seven-year funding amounting to $100 million from a consortium of financial institutions to empower Kenyan SMEs.

SMEs are a major source of employment in Kenya, providing jobs to a large number of people, especially in rural areas. They absorb a significant percentage of the labor force, thereby reducing the burden on the formal job market.

With a strong focus on climate and impact, the consortium lead DEG offers financing, advice and support to private sector enterprises operating in developing and emerging-market countries.

Loan to empower Kenyan SMEs

The loan is a Tier II …

• Shipping agents are not allowing cargo to Kenya as they avoid having goods getting stuck at points of entry, says a mobile importer in Nairobi.
• Kenya Revenue Authority is increasingly tightening checks at ports of entry to eliminate under declaration and concealment, which deny the country taxes.
• On average device shipment went down by about 13.5 per cent in the fourth quarter of 2022.

Kenya is hurtling into a severe shortage of smartphones as new tax measures and import regulations pile pressure on traders who have cut on shipments. Traders are projecting that the shortage of smartphones could push up the price of the gadgets by about 40 per cent.

The move follows a decision by the Kenya Revenue Authority (KRA) to plug loopholes used by traders to under declare or conceal the value of gadgets in turn denying the government revenues.

Alice, an importer and dealer within Nairobi’s Central …

• About 3.3 billion people are living in countries where debt interest payments exceed expenditure on health or education.
• African countries pay four times more for borrowing than the US and eight times more than wealthy European economies.
• UN Secretary-General António Guterres says growing debt burden is undermining global prosperity.

The United Nations has fired a warning shot on soaring global public debt, which hit record $92 trillion in 2022, saying that it risks sending more poor countries into the roiling economic crisis.

According to UN Secretary-General António Guterres, the swelling debt burden is undermining global prosperity. There has been a five-fold surge in public debt levels since 2000. Guterres says it “demands immediate action to tackle the escalating crisis affecting developing countries in particular.”

The UN Secretary-General underlined: “On average, African countries pay four times more for borrowing than the United States and eight times more than the wealthiest European …

• Over half of Sudan’s gold is smuggled out of the country with the proceeds going to finance internal conflict.
• Last year, Sudan’s Central Bank banned the export of gold by government agencies and foreigners, individuals, and companies.
• The directive, however, excluded concession companies operating in mining.

Lack of a well-coordinated management in the port of Djibouti is turning out to be a benefit for Russia, which is expanding its influence over Sudan’s gold reserves while solidifying its superpower standing in the Middle East.

These revelations are in a new report published by the Pangea-Risk, a specialist intelligence company. The report is offering analysis and forecasts on political, security, and economic risk in Africa and the Middle East.

The report comes weeks after the Wagner Group threatened to topple Russian President Vladimir Putin. With a power struggle in Moscow, Wagner’s clients are in a tailspin, unsure of the future of their …

Kenya’s Mombasa port has for years remained the leading harbour in East Africa, serving traders in the country and neighbouring landlocked states. Uganda is the biggest destination for transit cargo through the Port of Mombasa, accounting for about 83.2 per cent of transit cargo through the Kenyan port. South Sudan takes up 9.9 per cent while DR Congo, Tanzania and Rwanda account for 7.2 per cent, 3.2 per cent and 2.4 per cent, respectively.…

•  In Kenya, mining yields high-grade quantities of gold, copper, ilmenite and tantalum.
• Kenya is an important source of non-metallic minerals including soda ash, limestone, salt, niobium, fluorspar and fossil fuels.
• Titanium ores have for the last decade remained top mineral forex earner for Kenya.

A plan to give Kenya’s mining sector a makeover is underway, with policymakers banking on reforms that can attract investors as the country seeks to grow the revenue base.

The move comes four years since the 2019 government moratorium on the issuance of new prospecting and mining licenses. At the time, the government had not renewed licenses since 2015 when about 65 companies saw their permits revoked.

Those in operation run under a gazette notice. For companies whose permits expire, they are forced to seek special clearance from the ministry. The freeze on issuance of new licenses was to allow for geospatial surveys to map out …