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In this column called “The Indicator,” we will be taking an economic or financial statistic from East Africa and breaking it down into bite-sized nuggets of knowledge for investors.

This month’s indicator figure is 63

63 what?

There are exactly 63 investors focused on early stage, seed, or “angel” investing in the East African Community (EAC) countries according to Angel List, a global platform for start-up investing that seeks to “democratize the investment process and to help start-ups with their challenges in fundraising and talent”.

What is an angel investor and what do they seek to invest into?

An angel investor is a term for typically a wealthy individual who invests in a start-up, early stage, seed stage, at the new company level,or in relatively new companies that are looking for a higherreturn on the higher risk of business start-ups.

In East Africa, angel investors typically invest anywhere from US$1,000…

As at 2015 the informal sector employed over 80% of the Kenyan working population as was reported in an article published by the Institute of Economic Affairs. The same is the case in most developing countries, where the informal sector accounts for up to half of most economic activity.

While the informal sector accounts for a significant proportion of the workforce in the East African region, its impact on GDP is largely outsized by the more formal sectors of the economy when the value of output is taken into consideration.The informal sector in Kenya only accounts for slightly above 30% of the GDP. Over 60% of those working in this sector are youth between 18–35 years, and half of them are women.

The resulting assumption, as is characteristic of the informal sector in an economy, is that a majority of the players do not register or comply with any regulations.They…

Going by current research, it is correct to note, rather with melancholy, that we will lead much lower quality lives in our retirement days if we do not change our pension and retirement plans today.

In a recent report published by the Daily Nation, experts observe that Kenyans are saving much less due to a number of reasons including daily basic needs, and other saving and investment opportunities.

Subsequently, with minimal cash set aside over the years, pensioners are finding themselves leading a more substandard life than they did during their active years.

According to several studies, pension income is way too low compared to what the pensioners used to earn before retirement. In their study in 2019, Zamara Group, a financial services firm concluded that pensioners receive about a third of their last wages. The study covered 65,000 members from 200 pension schemes. Enwealth Financial Services Limited’s survey indicated

The Finance Bill, that became law as of February 1, 2020, among other things, increased the Value Added Tax (VAT) rate from 5% to 7.5%. The additional revenue is intended to fund healthcare, education and infrastructure. To mitigate the impact of the VAT rate increase, the Government expanded the list of VAT-exempt items to include staples such as bread,cereals, all kinds of fish, flour and starch meals;fruits, nuts, pulses and vegetables,root vegetables, meat and poultry products,milk,salt and herbs, and natural water and table water.

The Bill is also not intended to be a ‘one-off’ document as the government intends to amend the Finance Act annually along with each appropriation Bill; as a way to ensure that there exists a more integrated fiscal structure in governance, and more efficient planning.

The key changes in the statute lean towards the Federal Government’s stance that the ‘common man’ was considered in the development…

There is only one road left to achieving the Sustainable Development Goals (SDGs) set for Africa for 2030 and that is through sustainable businesses.The sluggish progress to date has been primarily a consequence of ‘putting all our eggs in one basket’ and expecting the state to deliver the SDGs, which it cannot.

A prime obstacle in that is finance. The SDG Center for Africa estimates the financing gap to achieve the SDGs is running at between $500bn and $1.2tn a year. That is simply beyond the reach of the public sector, with the Center estimating that delivering basic state functions of health care, education, water, energy, and road infrastructure requires more than 50 per cent of the GDP of most African countries.

However, for the private sector, pursuing the 2030 goals of eradicating Africa’s hunger, poverty, and inequality and improving health care will deliver its own rewards, creating business opportunities…

When we speak of inclusivity in healthcare, cleft lip and palate surgery is often considered a footnote in the priorities given to healthcare financing. Around the world, many children with clefts live in isolation, making it difficult to make friends and go to school, but more importantly, have difficulty eating, breathing, and speaking. As we seek to achieve Universal Health Coverage, the long-term benefit of treating a single cleft at an early stage can bring in as much as $50,000 to the economy. This economic benefit therefore deserves to be considered a priority as governments address paediatric surgical care.

The Fourth meeting of the Global Initiative for Children’s Surgery (GICS IV) which took place in Johannesburg from 17^th-18^th January 2019, brought together providers and implementers of surgical services for children, along with health, advocacy, and policy experts. Participants discussed the current state of surgical care for children…

The state of data privacy is a widely discussed topic of conversation. The new EU data protection law is setting Kenya up for the next step towards foreign investment opportunities. In short, these new legal standards will place restrictions on the handling, storing and shareability of personal user data.

Following the announcement on 8 November 2019 that President Kenyatta signed the European Union General Data Protection Regulation, aligning Kenyan legislation with the EU, great interest was ignited as the new legislation offers more regulated safeguards against the misuse of personal information. Furthermore, it comes with a substantial fine of three million shillings or a two-year jail sentence, should the terms be violated.

Digital-lending apps, in particular, have come under scrutiny for malicious attacks that gain access to smartphone data without consent to determine creditworthiness. With mobile technology and digital apps on the rise, wehave already started to see resistance…

For those who have obtained credit facilities from banks or financial institutions (FI) they must have at one point raised the question that we intend to discuss in this article.

It is likely that somehow borrowers have managed to obtain misinformation from friends, the public or the lender. There has been a misunderstanding by many borrowers that as long as they have “collateral” they deserve that legal right to obtain credit facilities from the bank. I refer to this as a misunderstanding because banks/FI do not lend against the collateral; rather lending is based on the viability of the business/project to be financed.

In the process of credit risk assessment the primary repayment source of a credit facility is the cash flow from the business to be financed or from other pre-identified source of cash flow. The cash flow is what is considered as primary collateral. Banks and FI will…

The first quarter of 2020 has had mixed results for the economies of East Africa. The weather, a key determinant of inflation rates, has been good. Forex rates have remained stable in the region as a balance between dollar demands and diaspora remittance has been easily reached. Eastern Africa is one of the regions in Africa with the highest growth rate and this has remained so in the first two months of the year, with Ethiopia and Rwanda still in the driver’s seat. In terms of foreign direct investments, Kenya and Ethiopia are still the leading pack, with Kenya receiving investments in ICT and manufacturing while Tanzania is receiving investments in mining. Rwanda is a leading conference destination and Uganda is receiving investments in renewable energy as well as in oil and gas.

Kenya and Rwanda are still leading in developing policies that promote trade and investments, while Ethiopia is…

Kenya has always been at the center of wildlife conservation due to its world-renowned national parks and an active conservation movement. Drawn by the large economic benefits brought about by tourism, wildlife conservation is however increasingly becoming a strained trade.

Three events happened in the last two months that have cemented Kenya as the center for conservation. First, a project to maintain the legacy of the last white rhino in the world received a boost after the country announced the successful fertilization and creation of new embryos from the original bull.

This research was conducted by Kenya Wildlife Services, OlPajeta Conservancy both based in Kenya, Berlin-based Leibniz Institute for Zoo and Wildlife Research (Leibniz-IZW), Italian institute Avantea, and DvůrKrálové Zoo based in the Czech Republic.

The scientists and conservationists predict to have more embryos ready for eventual breeding and repopulation in the near future. This was a series of cutting-edge