- Shareholders pressure Glencore spin off and disposal of coal business in two years
- Airtel Africa launches new data centre business Nxtra
- How Africa can cushion the blow of China’s economic slowdown
- Business conditions in Kenya remain in a steep decline amid inflationary pressures
- Making waves: Zanzibar’s quest to become Africa’s new tech hub
- Costly loans loom large as Kenya’s Central Bank hikes rate to 12.5 per cent
- Falling commodity prices dampen Zimbabwe’s 2024 economic growth prospects
- Youth-led African enterprises awarded $800,000 at COP28 for climate solutions
- The Central Bank of Kenya benchmark rate has gone up to 12.5 per cent from 10.5 per cent.
- Developing economies including Kenya are paying dearly for geopolitical tensions.
- The current US policy rate at 5.25 per cent -5.5 per cent is the highest in 22 years, exerting pressure on economies.
Borrowers in Kenya are facing the prospect of more expensive loans following the country’s central bank’s decision to raise its base lending rate to a near 11-year high of 12.50 per cent. This marks an increase from the 10.50 per cent rate that has been in place since June this year, when it rose from 9.50 per cent due to a rise in non-performing loans in the banking sector.
The hike in rates occurs as Kenya, along with other economies in the region, continues to grapple with the impact of global factors, including elevated interest rates in the United States. …
- The UAE Banks Federation (UBF) has committed to mobilize $270 billion in sustainable finance by 2030.
- His Excellency Abdulaziz Al-Ghurair, Chairman of the UAE Banks Federation, announced the pledge at an event jointly organized by the Central Bank of the UAE and the COP28 Presidency, aiming to support and facilitate global climate finance solutions and progress towards a sustainable future.
- UBF has been working closely with its partners on sustainability efforts to accelerate and advance sustainable development goals.
The UAE Banks Federation (UBF), the sole representative and unified voice of banks in the UAE, has committed to mobilize $270 billion in sustainable finance by the year 2030. His Excellency Abdulaziz Al-Ghurair, Chairman of UBF, announced the pledge at an event jointly organized by the Central Bank of the UAE and the COP28 Presidency, aimed at supporting and facilitating global climate finance solutions and progress towards a sustainable future.
“The pledge …
- The Central Bank of Kenya says tea exports posted a 13 percent year-on-year increase.
- As for the direction of trade, imports from China accounted for 21 percent of Kenya’s total imports.
- Goods exported to Africa in the fourth quarter of 2022 amounted to USD 729 million or 41 percent of the total exports.
Kenya’s current account balance has narrowed to $966 million due to the increase in remittances sent by Kenyans living abroad and a renewed demand for tea from traditional markets the Country’s Central Bank has said.
This figure represents a decline from the previous quarter’s balance of $1,557 million that was reported at the end of 2021.
The current account balance is a crucial component of the country’s overall financial inflow and outflow record, forming part of the balance of payments, which reflects all transactions made by Kenya with its trading partners.
Growth in exports of key goods…
- South Africa has just 18 months to show that it has an effective anti-money laundering (AML) policy.
- The government estimates that between $2 billion and $8.3 billion is laundered annually through local financial institutions.
- Banks in South Africa must find a new way to prove identity to prevent money laundering and cyberattacks.
South Africa has just 18 months to show that it has an effective anti-money laundering (AML) policy, an undertaking that banks can help to rescue the country from the grey list. In January 2025, the global anti-money laundering watchdog, the Financial Action Task Force will review its decision to greylist South Africa. The agency will interrogate the public and private sector measures taken by the country to address its concerns.
The nation will have to present a workable, scalable plan to stop fraud, money laundering, and other financial crimes. Failure to do so will have severe negative economic …
Djibouti is set to receive a $120 million loan from the African Export-Import Bank (Afreximbank) in a deal targeting projects that will accelerate the country’s economic growth.
The financing, which will go to Djibouti’s Great Horn Investment Holding (GHIH) to execute projects in the country’s Damerjog Industrial Development Free Trade Zone, is part of a total facility amount of $155 million. The remaining $35 million will be financed through Banque pour le Commerce et l’Industrie Mer Rouge of Djibouti. …
- 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.
- 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 …