NBK gets relief in Sh500m debt tussle with Ecobank
The National Bank of Kenya (NBK) has won a temporary reprieve after the Court of Appeal halted a demand for payment of over Sh500 million to Ecobank arising from a financing deal linked to the supply of digital driving licences to a State agency.
A bench of three judges ruled that the appeal by NBK was arguable and the amount in contention quite substantial, and which was likely to occasion considerable hardship to NBK, especially if the appeal succeeds.
Source: Business Daily
Green energy firms face tough times on production freeze
Wind and solar power producers face tough times following a plan to review energy supply versus demand with a view to freezing them. According to sector regulator, due to poor uptake, producers are now having to wait as the government comes up with an energy auction plan before cashing in their multibillion-shilling investments. The Energy and Petroleum Regulatory Authority (EPRA) said the review on proposed projects in line with the revised demand-supply balance, will cause some to be delayed to minimise increase in energy and imminent rise in generation tariffs. “In order to forestall the possibility of excess energy in the system, EPRA plans to undertake revision of the demand-supply balance and factor in the impact of COVID-19. The regulator will also suspend issuance of commissioning dates for solar and wind projects under the Feed-in Tariffs (FiT) Policy, to provide room for the development of renewable auctions system by the Ministry of Energy which targets the intermittent technologies,” EPRA said in a statement. Under the FiT Policy, producers sell renewable energy generated to Kenya Power at a pre-determined tariff signed in the purchase agreements.
Source: Business Daily
Submit a register of beneficial owners as soon as possible to ensure compliance
Kenyan companies are now required to submit details of their beneficial owners to the Registrar of Companies (Registrar). In 2019, the Companies Act, 2015 was amended to introduce a requirement for every company to maintain a register of its beneficial owners and to submit a copy of this register to the Registrar. In early 2020, regulations were published setting out the details required to be provided in the register, as well as other compliance obligations. Companies have, however, not been able to comply with these requirements because the Registrar had not yet established a beneficial ownership register within the registry system. The register has now been operationalised with effect from 13 October 2020 and companies are therefore required to comply. All companies should begin the process of sifting through their direct or indirect chains of ownership in order to identify and document details of their beneficial owners.
Source: Business Daily
Quarterly banking sector deposits up 6.6 pc
THE deposits for banking institutions rose by 6.6 per cent to 20.07tri/- at the end of March, compared with 18.83tri/-recorded in the corresponding period last year, contributed largely by the increased number of agent banking services.
According to the Bank of Tanzania (BoT) Consolidated Zonal Economic Performance Report, it shows that the deposits improved in all zones, largely driven by increase in agent banking services.
Source: Tanzania Standard Newspapers Ltd
Tanzania: The Board of Directors of the African Development Fund (ADF) has approved a loan of USD50.7-million to Tanzania to finance the nation’s response to the COVID-19 pandemic. The loan, from the African Development Bank Group’s COVID-19 Response Facility (CRF), will support the Government of Tanzania’s USD109-million national COVID-19 response plan, which is jointly supported by the country’s other development partners. The plan is aimed at building economic resilience, while mitigating the socio-economic and health impacts of the COVID-19 pandemic, particularly on local businesses, vulnerable households and the country’s health system. The pandemic has put increased pressure on Tanzania’s health facilities, social protection systems and has dampened the country’s projected growth of over 6.2% – the average over the last five years, and which had made it one of the best performers in Eastern Africa. Growth is now projected to decline from the pre-COVID-19 projections of 6.4% to between 3.6% and 2.6%.
Source: African Development Bank
Tullow receives government approvals for USD575-million sale of Uganda assets to Total
Tullow Oil, independent oil & gas, exploration and production group announced the Government of Uganda and the Ugandan Revenue Authority have executed a binding Tax Agreement that reflects the pre-agreed principles on the tax treatment of the sale of Tullow’s Ugandan assets to Total. The Ugandan minister for Energy and Mineral Development has also approved the transfer of Tullow’s interests to Total and the transfer of operatorship for Block 2. With all the government-related conditions to closing having been satisfied, Tullow expects the transaction to close in the coming days after completing certain customary pre-closing steps with Total. Tullow will provide a further update once the transaction has closed and funds have been received. On closing, Tullow will receive USD500-million consideration and a further USD75-million when a Final Investment Decision is taken on the development project. In addition, Tullow is entitled to receive contingent payments linked to the oil price payable after production commences.
Source: Africa Business Communities
Uganda fails to attract new bidders for oil blocks
The second extension of bids for Uganda’s second oil licensing round expired at the end of last month without any new expressions of interest received from oil companies to explore five new blocks on offer in the Albertine Graben, The EastAfrican has learnt. And now permanent secretary in the Ministry of Energy, Robert Kasande says as the global outlook for upstream activity continues to look gloomy, the ministry is set to proceed with the licensing. “We got six applications in total; these are the ones we are going to evaluate,” he said. Uganda is keen to see more upstream activity especially exploration in a bid to strike more oil and increase its reserves above the 6.5 billion barrels of oil that it discovered in 2006, of which an estimated 1.4 billion to 1.7 billion barrels are recoverable. Uganda’s first competitive licensing round in 2017 did not attract global oil majors, instead 17 small oil firms put in bids which culminated in only two firms being picked. In the second round Uganda aims to increase international investment into its oil rich energy sector, with government expecting to sign production sharing agreements and issue exploration licences to successful firms.
Source: The EastAfrican
Uganda: Uganda’s central bank has kept the key policy rate unchanged at 7%, a stance described by analysts as “cautious and guarded” amid a looming rise in inflation following the easing of lockdown restrictions. The Bank of Uganda (BoU) noted a slight improvement in both foreign and domestic demand which, along with the easing of the lockdown and a stable exchange rate, are supporting economic growth recovery. But, the regulator warned that the “economic outlook is extremely uncertain”, largely due to the COVID-19 pandemic. The central bank warned that inflation would remain above its 5% target until about 2022.
Source: The EastAfrican
African and US development financiers reaffirm their commitment to attracting greater private sector capital to Africa
The continent’s largest development finance institutions have emphasised that a sustained and collaborative approach among development partners to scale up project development activities, will boost the number of bankable projects attracting investor interest and contribute to closing the infrastructure finance gap in Africa. They spoke during a panel event to discuss their organizations’ role in post-COVID-19 environment, convened on October 16, as part of a day-long public forum on investing in Africa’s future, organised by the U.S. International Development Finance Corporation (DFC) and the Atlantic Council. Launched at the end of 2019, the DFC has an investment cap of USD60-billion and has selected Africa as a priority region for future investments. The panelists highlighted the importance of project development and a supply of bankable projects as being key for private sector investors. This requires an active approach in investing capital into the early stages of project preparation and accepting the risk, which has been one of the most important deterrents to attracting foreign investment into Africa. Most of the participating institutions offer a wide variety of financial instruments and products to help de-risk such investments.
Source: African Development Bank
AU chair urges Africa to prepare to implement AfCFTA
The African Union (AU) chairperson Cyril Ramaphosa on Thursday, 22 October called on the continent’s Regional Economic Communities (RECs) to prepare to start trading under the African Continental Free Trade Area (AfCFTA) agreement effective from 1 January 2021. Ramaphosa made the remarks in his closing address at the second AU mid-year coordinating meeting, expressing satisfaction with the progress made to achieve the continent’s Agenda 2063, Africa’s development blueprint, which gave birth to the AfCFTA idea. “With the finish line now in sight, we must make this final push and ensure all outstanding issues on Phases 1 and 2 are finalised in order for us to start trading by 1 January 2021,” he said. “It is imperative that we strengthen the RECs as building blocks for Africa’s continental integration,” said the chairperson, commending all the regional economic blocks for prioritising the AfCFTA. The RECs present at the meeting include the Southern African Development Community, the East African Community and the Economic Community of West African States.
Harmonised energy database will empower African energy sector
The fast-growing development of the energy mix in Africa calls for an upgrade of the existing energy database. This was highlighted during the digital dialogue ‘Building a Harmonised and Centralised Energy Database Through the Africa Energy Information System (AEIS)’, hosted by the African Development Bank (AfDB) during the Digital Energy festival. Moderated by Maximillian Jarret, the Africa programme manager at the International Energy Agency (IEA) – the digital dialogue was streamed live on Wednesday, 21 October, as part of the six-week Digital Energy Festival for Africa. The dialogue focused on the necessity of improving the existing energy database in order to better appreciate the energy needs of African nations. The IEA welcomes the ambition to modernise and expand AEIS, said Roberta Quadrelli, head of section, energy data centre at IEA, adding that the move will reduce duplication and benefit both IEA and the African Energy Commission (AFREC). AFREC publishes an annual Africa Energy Database which contains the energy balance for all African countries. The Commission is currently working on the 2019 version and says the 2019 African Energy Statistics will expand the coverage to include CO2 emission, energy prices and taxes data.
Source: ESI Africa
EAC calls for development of bioeconomy strategy in the region
The East African Community (EAC) on Wednesday, 21 October called for the development of a bioeconomy strategy in the region to open opportunities for research cooperation. Christophe Bazivamo, deputy secretary-general of EAC, said that a regional bioeconomy strategy and the use of renewable biological resources sustainably to produce food, energy and industrial goods will lead to the promotion of trade in value-added bio-based goods and services. “The strategy will also augment the region’s efforts to engage more effectively in the African Continental Free Trade Area,” Bazivamo said during the first regional bioeconomy conference in Nairobi. He urged scientists, policymakers and business leaders to develop sustainable bio-based solutions that could spur growth in the region. The EAC official noted that the COVID-19 pandemic challenges have underscored the need for innovation collaboration in the region to contribute home-grown solutions for managing emerging public health problems and long term prosperity of the region. The official said that the region has come together to develop a regional strategy for a sustainable bioeconomy which is consistent with efforts to achieve the Sustainable Development Goals (SDGs) 2030 and aspirations for the African Union’s agenda 2063.
EAC, EU launch regional economic integration programme
The European Union (EU) Ambassador to Tanzania and the East African Community (EAC), Manfredo Fanti and the secretary general of the EAC, H.E. Libérat Mfumukeko, launched a new EUR16.4-million joint programme to strengthen regional economic integration, through advancing implementation of the Customs Union and Common Market Protocols. In particular, the Common Objectives in Regional Economic Integration (CORE) programme will be instrumental in moving towards a fully-fledged Customs Union, by supporting more robust information, communication and technology (ICT) based data exchange protocols for the clearing of goods. Thanks to digital solutions, customs operations will be simpler, quicker, as well as safer during the pandemic thereby resulting in a reduction of the costs of cross-border trade. A new impetus will be given through this programme to promote free movement of services, a crucial building block for the creation of the EAC Common Market. The CORE programme will support implementation of services’ liberalisation commitments, facilitating mutual recognition of professions and allowing companies to provide their services beyond their national borders. During the first two years, the focus of this programme will be on the insurance, accounting and distribution sectors.
Senior government officials hope to complete WTO accession by next year
Ethiopia is working to complete its accession to the World Trade Organization (WTO) by next year. In an exclusive interview with ENA, senior policy advisor and chief trade negotiator, Mamo Mihretu revealed that the negotiation toward accession to the WTO which started 16 years ago is making progress. In a multilateral negotiation held last January with WTO member countries, Ethiopia had examined its trade and investment regime against WTO agreements and requirements. For the most part, the country’s trade regime is consistent with WTO rules and regulations, the senior policy advisor said, adding that “we believe that there will not be an important setback for Ethiopia to be part of the multilateral trading system.”
Technical Meeting on GERD to Start after Few Days
Ethiopia, Egypt and Sudan have reached an agreement on the resumption of the tripartite negotiation to discuss and finalize in the coming seven days.
The virtual negotiation among the Ministers of Foreign Affairs and Water Affairs of the three countries over the filling and operation of the Grand Ethiopian Renaissance Dam commenced on Tuesday.
The meeting is convened by the Minister of International Relations and Cooperation of the South Africa and Chairperson of AU Executive Council, on a letter addressed to the three countries on October 21, 2020.
The ministers deliberated on the resumption of the tripartite negotiation on the Great Ethiopian Renaissance Dam (GERD) within the AU framework.
A stronger private sector could boost Nigeria’s economic growth: IFC / World Bank report
A new report from the International Finance Corporation (IFC) and the World Bank focused on the health of Nigeria’s economy finds that a broader private sector-led growth strategy could help Nigeria realise its immense potential by attracting more investment and creating millions of quality jobs for its growing population. The report, the ‘Nigeria Country Private Sector Diagnostic (CPSD)’, calls for placing greater emphasis on addressing infrastructure deficiencies and investment policies and identifies agribusiness, manufacturing, and digital entrepreneurship, among others, as high potential sectors that can speed economic growth and job creation in Africa’s largest economy. Launched as Nigeria works to recover from the impacts of COVID-19, the report examines how Nigeria’s vibrant private sector, dominated by smaller businesses, will require improved policy frameworks and reforms to support sectors beyond oil, which contributes nearly 90% of the country’s export earnings. The report also highlights how potential investors and Nigeria’s private enterprises can best benefit from the country’s extensive agricultural and mineral resources, its young and entrepreneurial labour force, and its strategic position in Africa with market access to other member countries of the Economic Community of West African States (ECOWAS).