AELP link to boost trading among African securities exchanges
Cross-border trading from one African securities exchange to another comes a step closer after the African Securities Exchanges Association (ASEA) signed a contract to procure an order-routing system. Seven of Africa’s leading Securities Exchanges are working together in the African Exchanges Linkage Project (AELP) to boost pan-African investment flows and bring more liquidity to African markets. The contract is for the design and rollout of the AELP Link technology platform for routing orders and trade confirmations between stockbrokers on the seven exchanges participating in the pilot phase of the AELP. The supplier is DirectFN, a global information technology firm experienced in capital markets solutions across the Middle East and many emerging and frontier markets, which was awarded the contract after a competitive bidding process that attracted applications from top international suppliers in 18 countries. The AELP is a joint initiative by ASEA and the African Development Bank aimed at unlocking pan-African investment flows, promoting innovations that support diversification for investors, and addressing depth and liquidity in the markets.
Source: Africa Business Communities
African Development Fund extends USD2.5-million in grants to support the regulatory environment in SADC and COMESA electricity markets
The Board of the African Development Bank (AfDB) Group has approved grants of USD2.5-million to advance intra-regional harmonisation of electricity regulations and drive cross-border power trading in the Common Market for Eastern and Southern Africa (COMESA) and Southern African Development Community (SADC) regional blocs, which cover 28 African countries. The grants, USD1.5-million for COMESA and USD1-million for SADC, will be sourced from the African Development Fund, the AfDB Group’s concessional financing window. The projects will be implemented through the Regional Association of Energy Regulators for Eastern and Southern Africa (RAERESA) and the Regional Energy Regulators Association of Southern Africa (RERA), respectively. The grants will fund technical assistance to promote the development and adoption of regional electricity regulatory principles, enhance capacity to monitor utility performance across the region, conduct a cross-border analysis of electricity tariffs, and develop a centralised database management system in both blocs.
Google joins Smart Africa Alliance to drive digital transformation in Africa
Google has joined Smart Africa as a platinum member of the Alliance, advancing its commitment to the digital transformation of Africa. The Alliance is tasked with defining Africa’s digital strategy to ensure socio-economic transformation and this is in sync with Google’s vision for Africa. Therefore, Google will contribute towards closing the digital gap through advancing digital skills development. With 32 countries under the Smart Africa Alliance, representing 815 million people across the continent, the partnership between Smart Africa and Google is well poised to make a significant impact on the vision of Smart Africa. Google joins other international and African technology firms as members of Smart Africa including Hewlett Packard Enterprise (HPE), Microsoft, Facebook, Inmarsat, Liquid Telecom, Orange, Intel, Ericsson, Huawei and Tata Communications & Transformation Services. Smart Africa also partners international organisations such as the International Telecommunications Union, the African Development Bank, GSMA and the World Bank.
Source: Africa Business Communities
Burundi launches her own Trade Information Portal
Burundi has launched her own Trade Information Portal (TIP) which is meant to map out all her imports, exports and transit procedures, fees and time. The next step after mapping will be to simplify and remove unnecessary and redundant bottlenecks. TIPs have already been launched and operationalised by Kenya, Rwanda, Tanzania and Uganda. On Tuesday, 27 July 2021, Burundi joined other partner states to avail her own TIP on the internet as committed by the Burundi delegation during the 38th Meeting of the Sectoral Council on Trade, Industry, Finance and Investment held in Arusha on 28 May 2021. The publication of trade information is a good sign that Burundi is committed to facilitate trade by making trade information more transparent. The launching ceremony was co-presided by Burundi’s minister of Finance and Economic Planning, Domitien Ndihokubwayo, and the minister of Trade, Transport, Industry and Tourism, Capitoline Niyonizigiye. Ndihokubwayo urged the private sector to use this opportunity offered by the government of Burundi to plan effectively for their business and the development of Burundi.
Source: East African Community
COMESA, Djibouti sign EUR2.5-million sub-delegation agreement to upgrade Galafi border post
The Common Market for Eastern and Southern Africa (COMESA) secretariat and the government of Djibouti have signed an agreement that sub-delegates the implementation of coordinated border management activities at the Galafi border post, on the Djibouti- Ethiopia border. A total of EUR2.5-million is allocated to this project under the European Union-funded Trade Facilitation Programme (TFP). The objective of the sub-delegation agreement is to enhance Djibouti’s progressive participation in the regional and international integration agenda through progressive removal of trade barriers at the border. Djibouti will receive support in the development of improved and harmonised regulatory frameworks and procedures at its border crossing to Ethiopia. This is in line with international and regional standards and best practices. Activities will focus on automation of border processes and inter-connectivity of border agencies, upgrade priority cross-border infrastructure and procure equipment aimed to improve cross-border trade and transport facilitation at the Galafi border post.
Ethiopia clears hurdle for M-Pesa expansion
Ethiopia has cleared the way for Safaricom to introduce its popular M-Pesa in the market of 110 million people after deciding to include the mobile phone-based financial services in the telecommunications company’s (telco) licence offered in May. Ethiopian authorities told Business Daily Thursday, 5 August that the Safaricom licence will be upgraded to include mobile financial services when it completes bidding for its second telecommunications operator permit. The bidding will be opened this month. A consortium led by Safaricom secured the first licence, which does not have a permit for mobile financial services like M-Pesa, in May. The consortium will start operations next year when Ethiopian authorities say the telco will have the right to operate mobile financial services. This marks a departure from last year’s directive that only allowed locally-owned non-financial institutions to offer mobile money service, dimming the hopes of foreign firms like Safaricom that are seeking a presence in Kenya’s neighbouring country.
Source: Business Daily
Ghana seeks to borrow USD1.7-billion to help acquire energy assets
Ghana is seeking parliamentary approval to borrow as much as USD1.65-billion to accelerate oil and gas exploration by acquiring and developing assets. The investment push comes after Exxon Mobil Corporation pulled out of an offshore prospect in the West African country in May, dealing a blow to its burgeoning oil and gas sector. There are also rising concerns that the push for lower-carbon energy may reduce the value of Ghana’s hydrocarbon resources over time. The nation estimates it will need as much as USD1.3-billion to buy a 37% stake in the Deep Water Tano/Cape Three Points asset operated by Aker Energy AS and 70% stake of the South Deep Water Tano field operated by AGM Petroleum Ghana Ltd., according to a parliamentary proceeding on Monday, 2 August 2021. The time has come for Ghanaians to “become masters of our own destiny when it comes to our oil and gas resources,” Charles Adu Boahen, minister of State at the Ministry of Finance, told Bloomberg by phone. “There will certainly be the demand for fossil fuels in countries outside of the West that will continue to use diesel and petrol-fired cars and consume power generated from fossil fuels for the foreseeable future,” he said.
Tax Exemptions Bill to be taken to parliament by end of 2021 – Deputy Finance minister
The deputy Finance minister, Abena Osei Asare, has said that the Tax Exemption Bill is set to be sent to parliament by the end of this year. According to her, the Bill is something that the ministry has worked on which is almost through to cabinet. Speaking on the Business Edition of PM Express, she said the Bill is part of the efficient and effective measures the Finance Ministry wants to introduce in revenue mobilisation. Osei Asare said the Bill when passed would assist in achieving “the revenue target without necessarily having to increase taxes in the course of the year.” She noted that the Bill though sent to parliament in 2019 was redrawn to be amended. This she said was because “we realised we needed to engage more of our stakeholders” in putting the Bill together. But this time around, the appropriate stakeholders have been consulted and the Bill is being assessed and is ready to be sent to parliament close of 2021, she told George Wiafe on JoyNews. The Tax Exemption Bill will comprise tax waivers given to local and foreign companies to encourage increased investment and more foreign direct investment in the economy.
Kenya issues licences to foreign reinsurance brokers after law change
The insurance industry regulator has started licensing foreign brokers who linked local firms with reinsurance contracts abroad. The Finance Act 2021 amended the Insurance Act to provide for the regulation of foreign reinsurance brokers by amending the definition of brokers, which previously excluded those who are not resident in Kenya. The Insurance Regulatory Authority (IRA) has issued a circular calling on all reinsurance brokers that have operations in the country to set up a physical office in Kenya and get a licence from the regulator. Chief executive Godfrey Kiptum said changes in the law were put in place to protect local players who use foreign brokers to buy re-insurance products. “The provision came into force in this Finance Act. It is meant to protect local players where you see some of them send money out to brokers and when something happens they come back to us,” he said. “We issued the circular this July but it is for the new contracts that are kicking in from January next year.” Kenya has 18 licensed insurance brokers. Mr Kiptum said that most of the foreign brokers operate from the United Kingdom, India and South Africa.
Source: Business Daily
Terminating probationary contracts without a hearing declared unconstitutional by Kenyan courts
The Employment and Labour Relations Court at Nairobi has declared section 42(1) of the Employment Act unconstitutional. This section allows employers to terminate an employment contract during the probationary period, without granting the employee the right to be heard. In the case of Monica Munira Kibuchi and 6 others versus Mount Kenya University, petition was brought by seven former employees of Mount Kenya University who had been terminated a day before their probationary period was up. The petitioners argued that this violated several constitutional principles. The court agreed with the petitioners and declared section 41(2) unconstitutional to the extent that it is inconsistent with the Constitution of Kenya which guarantees every person the right to fair labour practices and fair administrative action.
Nyusi invites US businesses to invest
Mozambican President Filipe Nyusi on Wednesday, 28 July 2021, invited businesses from the United States (US) to invest in Mozambique’s key sectors for development. Speaking on the second day of the 13th United States-Africa Business Summit, held in Maputo in virtual format, Nyusi said “I invite the Americans to invest in agriculture in Mozambique, to invest in infrastructures, energy and tourism, because these are very challenging areas”. He stressed that the US administration has shown “great openness” towards Africa “and this will be fundamental for increasingly cementing our relations”. The business summit is intended to look at the next stage in the economic partnership between the US and Africa, stressing health, gender equality, trade and investment as key areas of cooperation. Other key areas under consideration at the meeting were climate change, agro-processing, the energy transition and digital transformation.
Slight recovery in Q2 2021 – CTA
The Confederation of Economic Associations of Mozambique (CTA), the country’s largest private sector association, reports that the macroeconomic environment improved slightly over the second quarter (Q2) of 2021, increasing from 46% to 50%. However, it predicts a poorer third quarter, due to the tightening of Coronavirus (COVID-19) prevention measures. Speaking during the second edition of the Economic Briefing, CTA president Agostinho Vuma reported that business activity recovered due to the relaxation of COVID-19 counter measures, along with the start of agricultural marketing and of agricultural and fish product exports. “As a corollary, the Business Robustness Index improved from 28% to 29%, influenced by the revival of economic activity in the sectors of Agriculture, Hotels and Restaurants, Trade and Services and Transport, which benefited from the factors referred to, including the easing of the COVID-19 containment measures that we observed from April to last June,” Vuma detailed. As for the business outlook in general, the CTA president expects business performance to decline, due to the resumption of restrictive measures recently announced by the government in response to the emergence of the new Delta variant.
Source: Club of Mozambique
Mining production boosts exports – Trade statistics
Mining production across different commodities lifted exports significantly in June 2021 as exports increased by 14.1% in June 2021 to NAD8.6-billion, an increase of NAD5.4-billion a month earlier. According to the latest trade statistics by the Namibia Statistics Agency, key commodities accounted for just over 70% of total exports, where exports in zinc increased by 460,623.5%, uranium 549.7%, copper 43.1% and gold up by 7.7% in June 2021. Exports in diamonds decreased by 7.8% in June 2021. Zinc exports shot off from a low base, recording NAD0.00 exports in May 2021 and NAD5-million in June 2021. Uranium was mainly purchased by China, with Canada buying a smaller share. Namibia sent most of its exports to China, South Africa, the Netherlands, Belgium and Spain (73.6% of all exports were sent to these five countries). On the other hand, imports increased by 33.1% in June 2021 to NAD9.6-billion, leading to a decrease in the trade deficit (from NAD3.2-billion in May 2021 to NAD987-million in June 2021). Namibia sourced most of its imports from South Africa, Peru, Zambia, the Democratic Republic of the Congo (DRC) and India (73.8% of all imports came from these five countries). The largest import product for June 2021 was copper, mainly imported from Zambia and the DRC.
Source: Namibia Economist
Rwanda raises USD620-million through a 10-year Eurobond
Rwanda will use part of its USD620-million raised from its second Eurobond issued on Tuesday, 3 August to pay back part of its USD400-million Eurobond that was expected to retire in 2023. This is meant to reduce pressure on government coffers that have come under intense pressure due to COVID-19 pandemic-related expenditures over the last 12 months. The latest issuing makes Rwanda the second country in the region after Kenya to issue another Eurobond to retire a maturing one. The country has taken advantage of the low interest environment in international financial markets making access to capital relatively cheap. For instance, the latest 10-year Eurobond, close to three times against investor interest of USD6-billion, attracted a coupon rate of 5.5%, lower than the 2013 rate of 6.625%, and Kenya’s 6.3%. “We are pleased with the positive response from investors in this 2021 Eurobond issuance. The lower yield of this issue will result in a reduction in our annual interest payments over the next 10 years, strongly contributing to our debt sustainability strategy. The funds raised will accelerate strategic projects in productive sectors that will further boost the country’s economic transformation efforts,” said John Rwangombwa, governor of the National Bank of Rwanda, in a Press Statement.
Source: The EastAfrican
Rwanda / Tanzania
New agreements between Rwanda and Tanzania to give impetus to joint projects like railway
Rwandan President Paul Kagame on Monday, 2 August said cooperation agreements signed between Rwanda and Tanzania will give new impetus to the implementation of joint projects like the Standard Gauge Railway. “Rwanda and Tanzania share more than just a border. Our strong historical ties and common aspiration to deliver prosperity to our people have always been central to our cooperation,” Kagame told a joint press briefing with his visiting Tanzanian counterpart Samia Suluhu Hassan in the capital city Kigali, shortly after they witnessed the signing of four cooperation agreements in the areas of information and communication technology, immigration, education and regulation of medical products. The signing of the agreements gives new impetus to key infrastructure and investment projects of mutual benefit, particularly the Standard Gauge Railway line, milk production and improved port logistics, said Kagame. President Hassan highlighted the need for cooperation in tackling the COVID-19 pandemic and full operation of the one-stop border post at Rusumo, a town on Rwanda-Tanzania border.
Tanzania updates telcoms licensing system to promote investments
The Tanzanian minister of Communications and Information Technology, Faustine Ndugulile, and the minister of Information, Culture, Arts and Sports, Innocent Bashungwa, have launched an improved Tanzania Communications Regulatory Authority (TCRA) Licensing System to enable large-scale telecommunications licensees to submit online applications. Minister Ndugulile noted that the telecommunications sector is currently undergoing major changes and that the government is committed to adapt to them with new investments. He also noted that the licensing system has been improved and that applications for small-scale telecommunications licences will take five days from application to completion if the applicant has completed all application procedures. In the case of large-scale licences, it will take 45 days to complete, which Ndugulile said is commendable for the great work that TCRA has done in completing the work to improve the system. He also noted that his ministry together with the Ministry of Information, Culture, Arts and Sports is determined to encourage investments, especially in the broadcasting sector.
Source: Tanzania Invest
BoU steps up pressure on banks to limit risks
During a virtual presentation at the Annual Bankers’ Conference held recently, governor Emmanuel Tumusiime Mutebile from the Bank of Uganda (BoU) said, “An increasing reliance on technology solutions and third party service providers increases operational risks, including cyber-security and money laundering risks.” The BoU has started reviewing regulations to mitigate technological risks in financial services as the 4th Industrial Revolution (4IR) is set to change the way banks do business. “Banks / financial services providers in Uganda should identify the risks of technology and put effective measures in place to counteract the dangers that are being exacerbated by technology advancements in this era of industrial revolution. On the other hand, the authorities responsible for financial consumer protection are increasingly facing the challenge of addressing these risks but often lack the technical expertise or tools to do so.
Source: Daily Monitor
Investment authority, UPDF in joint construction of industrial parks
The Uganda Investment Authority (UIA) has partnered with the Uganda People’s Defence Force (UPDF) to construct 25 industrial parks across Uganda. The partnership was formally announced on Thursday, 5 August in a meeting between the UIA’s director general Robert Mukiza and the managing director of the National Enterprise Corporation (NEC), Lt Gen James Mugira. The NEC is the business arm of the UPDF. The UIA, the primary investment promotion agency of the government of Uganda, is mandated to build 25 regionally-located industrial and business parks, including four science, technology and innovation parks (STIPs). President Yoweri Museveni on 28 June 2021, during the inaugural cabinet meeting of the current presidential term, directed that government should construct five industrial parks per year, rounding the end of the presidential term with 25 industrial parks. UIA director general Robert Mukiza stressed that the industrial parks will be for both domestic and foreign investors, adding that focus will be on equitable and regional distribution of industrial parks.
Source: The Independent
Uganda trade deficit widens, as imports from Tanzania hit 19%
According to the Ministry of Finance, the Bank of Uganda and the Uganda Bureau of Statistics (UBOS) latest data, imports from Tanzania have capped a seven-month surge, replacing Kenya as Uganda’s biggest source of imports in the region. Imports from Tanzania accounted for 19.2% of Uganda’s total imports bill in May, followed by China, India, Kenya and the United Arab Emirates, at 15%, 9.6%, 9.2% and 7.9%, respectively. According to UBOS, major imports from Tanzania include gold, rice, trailers and semitrailers, rolled iron and non-alloy steel and dried and salted fish as well as rice and wheat. Uganda is, however, concerned by the trade deficit, according to Aliziki Lubega, the director of macroeconomic statistics at UBOS. The deficit stands at USD105.31-million with the East African Community, with Tanzania accounting for the largest share of the deficit at USD138.2-million. It more than offset the surpluses recorded with South Sudan, Burundi and Rwanda of USD50.5-million, USD6-million and USD0.02-million, respectively.
Source: The EastAfrican
Zimbabwe bans raw chrome exports
Cabinet has approved an immediate ban on all exports of unprocessed chrome ore in order to protect the ferrochrome industry, which it says is integral in the country’s attainment of an envisioned USD12-billion industry by 2023. Announcing the latest strategy to boost the mining sector during post-cabinet media briefing on Tuesday, 3 August, Information, Publicity and Broadcasting Services minister, Monica Mutsvangwa said the moratorium on raw chrome ore exports would promote the local value-addition chain. “In light of the need to safeguard the ferrochrome industry in the above regard, Cabinet approved a total ban on exports of raw chrome ore with immediate effect. The ban will capacitate current smelters and maximise the value chain to be realised from the country’s abundant resources as spelt out in the National Development Strategy (NDS) 1,” she said. Mutsvangwa said: “Cabinet approved the total ban of export of chrome concentrates with effect from July 2022. This gives producers of chrome concentrates a year within which to make suitable arrangements for the value addition of the concentrates, the investment of which is low capital cost and relatively easy.”