KAM calls for change of laws toreduce excessive drinking

Kenya needs to develop a more comprehensive policy if its fight against illicit alcohol is to succeed, according to a new analysis of the regulation of alcohol in the country by the Institute of Economic Affairs (IEA).

The policy recommendation is contained in a White Paper by the Institute of Economic Affairs and launched by the Kenya Association of Manufacturers during the summit on illicit trade.

Kwame Owino, the Institute’s Chief Executive said that their analysis had shown that the approach taken to regulate alcohol is population-based rather than targeted at reducing excessive drinking.

“Regulation of the alcohol beverage sector is through the Alcoholic Drinks Control Act, which by reducing the amount of time for drinking and limiting the advertising of alcohol, assumes that it solves the problem of heavy drinking. But that does not work and more people are pushed towards illicit alcohol. By suppressing one side, you go back to the other side. Our licensing model actually creates barriers to market entry,” said Mr Owino.

Direct interventions targeting individual drinkers

He said that a regulation model that involves direct interventions targeting individual drinkers and others aimed at specific alcohol-related problems such as drunk-driving are less likely to affect the non-problem drinker.

“Kenya’s alcohol policies should not be exclusive but should encompass a mixed approach involving Problem Directed Policies and Intervention Policies. They have been proven to work elsewhere,” said Mr Owino.

The White Paper was launched at a day-long summit on illicit trade in Kenya, with focus on the alcoholic beverages sector. A resolution paper will be developed from the submissions made at the summit and submitted to the Treasury.

IEA argued that Population Based Policies are easier to administer but are unlikely to be most successful in Kenya given the low per capita consumption of alcohol, demographic changes, dual market structure and expected income growth among Kenya’s working population.

Consumption of alcohol in Kenya stood at 3.4 litres of pure alcohol

Data from the World Health Organisation shows the per person consumption of alcohol in Kenya stood at 3.4 litres of pure alcohol in 2018, much less than the global average of 6.4 litres per person.

Of the 3.4 litres, says the WHO, 1.9 litres is recorded (legally recognized) while 1.5 litres is unrecorded (not officially recognized).

“The negative effect on the industry by illicit alcohol is too big to ignore, given the extent of loss in Kenya. We are not only concerned by the health risk to consumers; illicit alcohol trade denies formal players a level-playing ground and the economy billions of revenue over time. This paper provides some insight to a cross section of stakeholders on how to forge ahead to eliminate this danger,” said Eric Kiniti, the Secretary of Alcoholic Beverage Association of Kenya. The alcoholic beverages industry is a leading contributor to the Exchequer East African Breweries Limited, the leading player in the industry, estimated that it made tax contributions of up to Ksh. 42 billion in the fiscal year 2018.

The significance of the industry is amplified because the direct tax contribution represented 2.74% of all government revenues for the financial year 2017/18.

With the excess regulation that the recorded alcohol is subjected to, says IEA in the White Paper, more consumers are pushed towards the alcohol that is not officially recognised, and which bears risks for drinkers.

“In sum, excessive regulation can generate the unintended consequences of driving demand for alcoholic beverages in the informal sector and generate worse health outcomes owing to the production methods employed in the latter,” IEA says.

Wanyama Musiambo, the head of the Multi-Agency Taskforce on Enforcement of Standards has so far succeeded in clamping down on illicit products.

“We cannot say that we let people drink what they want yet the cardinal responsibility of the government is to protect Kenyans. If nothing else has been achieved, we have achieved public awareness and Kenyans know there is a problem of illicit trade,” said Mr Musiambo.

Mr Musiambo said the taskforce’s work is intelligence-led.

“Once we make a raid, we should, in a very accountable manner, be able to process and prosecute the case as we strengthen our borders to reduce the level of illicit products in this country,” said Mr Musiambo.

Githii Mburu, the commissioner for intelligence and strategic operations, said it is evident that a more comprehensive approach is needed if illicit products is to be dealt with.

“We have to have a more comprehensive approach so that we look at both the policies and the enforcement, and this is where this study comes in,” said Mr Mburu.

A friendlier tax regime

He said that with neighbouring countries having a friendlier tax regime, ethanol is cheaper there and thus the motivation by a lot of those who import it illegally to source it there.

The commissioner said there must be collaboration between the State and non-state actors for eradication of illicit alcohol to work.

“It should never be left to the government. It’s a partnership between the government and the private sector and we must work together for it to succeed,” said Mr Mburu.

Kenya Association of Manufacturers Chairman Sachen Gudka said companies are of the view that the issue of illicit products was bigger than initially thought.

“It is our view that a better informed regulatory and policy framework will be the bedrock with which the agencies tasked with enforcement will better carry out their mandates,” he added.

Also Read: This is what alcohol manufacturers in Kenya want

Why construction industry needs to embrace human resource management

Human resource has been described as the most essential resource in an organization since it is the human aspect that makes sure that all other resources work optimally (or not).

In the construction industry, the concept of human resource management is not as well defined and improved as in other mainstream and formal industries.

For every industry to grow there has to be continuous improvement of efficiency in resources usage. There has to be capacity building to empower all the stakeholders to be better and to do better.

Every construction site has labour, whether mechanized systems are employed or not and also regardless of the magnitude of mechanization. This therefore makes it necessary to direct enough attention and resources towards human resource management and development in construction.

How many times have you commissioned a site and you only know the contractor out of an average of 20 craftsmen in your premise? How many times have you thought of the fundi who helps the mason build your wall as a resource that could be improved through training and empowerment using fringe benefits such as insurance facilitation?

As a contractor, how many times do you think of your fundi as a resource that could benefit from  remunerations other than their daily wages?

Human resource management is a critical part of project management. A client who is building should be keen to know how well the resources are being utilized through-out the project. A contractor on site must be very hands on when considering the usage of resources in any individual project because this has a direct effect to the quality of his deliverables, his profit margins and eventually his reputation as contractor.

Imagine a contractor solution that comes in to help you conveniently manage your human resources on the job site; having the  proper knowledge of the people working on your projects, including their skills and skill level will increase a their capacity to function as a developer. Even as an independent Home Owner managing their own project, this knowledge brings then confidence in getting the right talent for every job. We live in the age where information is more powerful than anything!

There is no more need to imagine that solution. The iBUILD app  is here to revolutionize the human resource management aspect in the construction industry. It is a one stop shop where you have an elaborate and detailed list of all the fundis on your site, their skills, their reviews and recommendations from other contractors as proof of their capabilities. The iBUILD mobile app also allows you to digitize your day to day operations by running and managing timesheets. For every worker you hire through the iBUILD app, a timesheet is generated that helps you manage their working hours as it keeps records of the amounts due to each of them according to the hours worked. At the end of the day, it gives you a summary of who was on site and how long they worked and how much is due to them! iBUILD then provides the best tool of all- the ability to upload time sheets directly to the payment gateway and pay all of your workers through the iBUILD wallet. Straight from the contractor wallet into the worker wallets. And there is more! Workers can cash out of their wallets directly into their Mpesa accounts. Contractors will have a permanent record of who gets paid what amount, and who worked on which projects for how long. Workers are rated every time they are paid and contractors will never have to remember which workers performed well and which did not- it all becomes part of the permanent transaction history. Organized details, and historical knowledge all at your fingertips so that you minimize mistakes and continue to hire and manage the best talent for your projects.

What the App is able to achieve

You can even save your favorites for easy access to contact and hire them for new projects- all directly through the app.

As a Home Owner or developer, you are able to see the work profiles of all the people involved in your site. This puts the control back into your hands!

Marlowa Okwogo of Marvin Interiors Inc. is a company that specializes in interior installations and external façade finishes in Nairobi and Kisumu Counties. Marlowa has been using the new technology from iBUILD  to manage his fundis on site. He sent out a posting for some positions he needed urgently filled and within 6 hours he had a number of qualified applications. He was able to review and hire, all through the app. One worker in particular was named Charles. He has been managing these workers along with Charles through the timesheet on the app, as well as paying them and it has increased efficiency and accuracy and using the e-wallet in the app, the contractor no longer has to deal with all of that cash.

Mr. Marlowa was especially impressed by the convenience and the ability to keep better records. He can revisit these records in his project detail on the app at any point for referencing purposes. Charles, on the other hand appreciated the convenience of being able to get work to do right from the comfort of his home- without standing for hours on street corners. He is no longer just at home or roaming around. He has found consistent work and has started building his portfolio in the construction industry. He is now able to show tangible evidence through his profile on the app of the history of all his jobs and total hours he has worked and he has aa separate record of the payment dates and amounts he received.  This gives Charles the ability to qualify one day for a loan of his own and to help him to grow and scale his career in to the future!

The Kenyan development agenda requires that, as a country, we must be ready to improve our efficiency in all sectors. We must begin to add value to what we produce and what we build. The  iBUILD app is at the fore front to champion the ability of the construction industry to maximize efficiency and quality.  This improves production and scalability in the delivery of their products and services and it also improves the construction sector as a whole.  As acceptance for finance technology grows in the construction industry, so will the value that is ultimately delivered to customers in the form of increased production, greater choice, and lower prices due to increased efficiencies and better project management.

Read Also: Kenya mulls over new road construction method

Kenya’s steel makers lobby for zero rated fees to boost sector

Over 50 stakeholders in the steel sector have called upon the government to zero rate fees in a bid to boost the industry.

The stakeholders who converged for the first ever International Steel Forum in Kenya said that local steel industry is heavily dependent on imported raw materials.

The forum saw the stakeholders sourced from all over the world meet and focus on providing partnership opportunities to boost the sector’s competitiveness and developing frameworks of collaboration to better shape the future of the industry.

Speaking at the event, the Kenya Association of Manufacturers (KAM) Chair Mr Sachen Gudka noted that the local Steel sector has grown over the years, adding that the establishment of stronger partnerships with global investors, would be vital to attain the desired growth in the sector and the economy.

“The future of the sector looks at the development of Smart Infrastructure. Through data and employment of sustainable strategies the sector will spur the productivity of the country and the continent for the next generation.

We are at the juncture where our trade deficit continues to widen as a country, and the numbers in Steel are a clear demonstration of that. If we can forge stronger partnerships, with our global stakeholders finding opportunities to continually invest in Kenya, surely we can turn this around in a short amount of time,” said Mr Gudka.

He further stated that the realization of the targets set out under the Manufacturing and Affordable Housing pillars of the government’s Big 4 Agenda will require a significant input from the iron and steel sector, as it presents opportunities for growth.

According to data from the Ministry of Industrialisation, direct and indirect consumption of steel in Kenya is projected to increase as the country embarks on the development activities as envisioned in the Vision 2030.The major Vision 2030 projects include Lamu port development, railway and roads projects, housing, Industrial parks and the development of the special economic zones all of which utilize steel products. The Iron and Steel industry in Kenya forms about 13 percent of the manufacturing sector, which in turn contributes significantly to the GDP.

The local steel industry is heavily dependent on imported raw materials, as no local sources have been developed to date. The local deposits of iron ore and coal, which are the raw materials for the production of iron, that have been identified in several Locations in the country have not attracted commercial interest.

KAM Steel Sector Chair Mr Bobby Johnson highlighted that though the sector continues to grow, its full potential still remains unexploited, due to a variety of challenges including, high energy cost, Import Development Fees (IDF) and  Railway development levy (RDL) and illicit trade.

Zero Rating to improve sector competitiveness

“We have continued to lobby the government for Zero rating of IDF and RDL for all industry inputs to improve the sector’s competitiveness. In addition,  we are also keen on advocating for the development of clear procedures for smooth implementation of Buy Kenya, Build Kenya and local content – especially for large scale infrastructure projects with a high demand of steel.

If the Big 4 Agenda target to grow Manufacturing’s GDP contribution to 15% is to be met, we must address these challenges.  We remain resilient in engaging the government, with proposals to solve these issues, and anticipate that  favourable  changes shall be effected soon,” concluded Mr Johnson.

It is estimated that the country spends about 60 billion shillings (approximately 750 million US dollars per annum on importation of steel. This import bill can be reduced if high quality steel is produced locally. The development of the iron and steel sector has a spillover effect to other sectors of the economy and has the potential to create employment opportunities to Kenyans. A single steel plant of a capacity to produce 350,000 metric tons of steel per year can generate about 10,000 jobs not to mention the jobs created through other steel related activities.

Other production activities depend on imported hot rolled coils, used for re-rolling into cold rolled coils, which in
turn are processed into galvanized sheets, color coated sheets, bars, rods etc. In 2017, imports of iron and steel were 1.3 million tonnes valued at Sh83,580 million ($826.347 million). Iron and steel exports during the same year are estimated to have been 108,717 tonnes valued at Sh11,717 million ($115.754 million). The local deposits of iron ore and coal, which are the raw materials for the production of iron, have been identified in Kwale, Kitui and Tharaka Nithi but are yet to attract
commercial interest.

KAM is a Business Member Organization representing value-add companies and associate services in Kenya.  Its members’ significant contribution to the economy is estimated at a quarter of the country’s Gross Domestic Product. The Association provides an essential link for co-operation, dialogue and understanding with the Government and other key stakeholders by representing its members’ views and concerns through fact-based policy advocacy.

KAM promotes trade and investment, upholds standards, encourages the formulation, enactment and administration of sound policies that facilitate a competitive business environment and reduce the cost of doing business.

The Association houses the UN Global Compact Network Kenya chapter and its CEO – Ms. Phyllis Wakiaga is the network representative for the country.

Read Also: Kenyan manufacturers back government on recycling

Russia leads CIS towards Islamic banking and finance

While considerably new, Islamic Banking and Finance has now taken firm roots in Russia and other Commonwealth Independent States (CIS) countries are following suit.

The total volume of Islamic Banking and Finance has now exceeded $2.6 trillion globally. This amount represents transactions, assets and investments by over 2,500 Islamic banking and financial institutions around the global.

In the modern era, Islamic banking and finance can be traced back to the 1960s from Egypt and Malaysia and its dramatic spread over the Middle East, Africa and Europe. Interestingly, while Islamic banking and finance was slow to take foot in Commonwealth Independent States (CIS) countries, its unprecedented growth over the last few years indicates that CIS countries are the emerging Islamic banking and finance market for the future.

Some well known CIS countries include Russia, Armenia, Kazakhstan, Uzbekistan, Tajikistan, Kyrgyzstan, Turkmenistan and Azerbaijan.

“The delay for Islamic finance initiative in CIS countries may count in many folds, it would be due to Russian influence in CIS countries,” suggests the Islamic Banking guru Mr. Muhammad Zubair Mughal who is the Global CEO of AlHuda Center of Islamic Banking and Economics.

https://theexchange.africa/zubair-mughal-wins-the-islamic-finance-recognition-award/

According to the seasoned banker, the mind set of Russian block and limited relations with International Banking and Financial Markets hampered development of Islamic Banking and Finance in CIS.

However, owing to what he described as ‘unstable Russian relationship with Europe’ and the sharp decline of oil prices has now compelled Russia to seek better financial alternatives, Islamic banking and finance.

Effectively, Russia has gone ahead and instituted friendly Islamic Banking policies and as a result geared-up Islamic banking and finance industry in CIS countries. This opens doors for enormous investment opportunities given that the Muslim population of CIS countries is estimated to be 75 million not to mention the non-muslim bankers that, like Russia, will opt for better banking options.

Russia also has a significant Muslim population and is with the recent government led initiative to support Islamic Finance it is expected that various Islamic banking and finance products will take root like Sukuk and Takaful.

Promoting Islamic Banking in CIS

AlHuda Centre of Islamic Banking and Economics (CIBE), a pioneer organization started its efforts to promote Islamic Banking and Finance is holding an Islamic banking and finance conference in Tashkent, Uzbekistan on 2nd May 2019.

The CIS Islamic Banking and Finance Forum will gather the CIS Islamic finance industry specialists and stakeholders on a single platform to promote Islamic banking and finance in the region.

In CIS countries, the Islamic banking and finance market can be divided into three parts. At first, there are countries such as Kazakhstan, Uzbekistan, Kyrgyzstan and Azerbaijan where the pace of Islamic banking and finance can be described as is satisfactory and where it is promoted and considered the sustainable financial alternative.

Secondly, there is the second group of countries, the likes of Tajikistan, Turkmenistan and Russia where the growth rate of Islamic banking and finance is rather slow. And the third group consists of countries in which there is no initiative taken so far, these are like Armenia, Ukraine and Belarus.

Kazakhstan leads the CIS in the growth of Islamic banking and finance. Started only in 1992, Islamic financing has grown drastically. More so, the growth can be noted following the global financial crises that started in 2008.

In Kazakhstan there is also considerable appropriate support of government institutions. Currently it has one full-fledged Islamic bank and 4 Islamic banking windows. They offer Takaful, Islamic leasing (Ijarah) and Islamic micro-financial institutions among other Islamic banking and Finance products.

Kazakhstan also launched an Islamic Agricultural Finance product with the financial assistance of the Islamic Development Bank. Further still, the recent establishment of the Astana International Financial Center (AIFC) places Kazakhstan as the regional center for Islamic Banking.

Azerbaijan comes after Kazakhstan but with much less government involvement. There is also no full-fledged Islamic bank in the country but there are at least 4 Islamic banking windows operating with limited Islamic Banking Regulations.

Uzbekistan follows and credit can be given directly to its new president H.E. Shavkat Mirziyoyev who has spearheaded the growth of Islamic Banking. Three Islamic banking windows are currently operational and accept deposits on Shariah bases.

Few Islamic leasing companies also offer Ijarah services, but it is predicted that after proper Islamic Banking and Finance regulations, Uzbekistan can supersede other CIS countries.

Neighbouring Kyrgyzstan also takes precedence its parliament passing the Islamic banking law in 2011 making it the only country in CIS to do so. In fact, there is at least one conventional bank that is in the process of becoming a full-fledged Islamic bank.

The most important factor of the growth of Islamic banking and finance industry in CIS countries is the Islamic Development Bank’s support.

https://theexchange.africa/emerging-trends-of-islamic-banking-and-finance-industry-in-cis-countries/

 

What Africa stand to gain from ACFTA

The African Continental Free Trade Area isn’t simply a ‘Free Trade Agreement’ it’s about establishing a unified continental market with 1.2 billion potential customers and where the private sector is a major engine to make it happen.

This, according to the East African Business Council (EABC) was the tone from the discussions of the meeting held on Thursday in Arusha about how the East African Private sector including Small and Medium Enterprises (SMEs) could benefit from the AfCFTA.

The one-day meeting, organized jointly between the EABC and the UN Economic Commission for Africa (ECA), convened close to 40 key players from the region’s private sector.

The office for Eastern Africa of ECA estimates large potential gains from the AfCFTA, including an increase in intra-African exports of Eastern Africa by nearly US$ 1 billion and job creation of 0.5 to 1.9 million.

“Together African economies have a collective GDP of 2.5 trillion USD, making it the 8th largest economy in the world. That makes the continent much more attractive to investment, both from within and from outside the continent”, said Andrew Mold, Acting Director of ECA in Eastern Africa. “This should encourage business people to take advantage of AfCFTA and make the investments necessary to sustain economic growth and create employment”.

Single continental market

According to data from the African Union, the objectives of the CFTA is to create a single continental market for goods and services, with free movement of business persons and investments, and thus pave the way for accelerating the establishment of the Continental Customs Union and the African customs union.

The agreement is also expected to expand intra African trade through better harmonization and coordination of trade liberalization and facilitation regimes and instruments across RECs and across Africa in general as well as resolve the challenges of multiple and overlapping memberships and expedite the regional and continental integration processes.

It is also expected to enhance competitiveness at the industry and enterprise level through exploiting opportunities for scale production, continental market access and better reallocation of resources.

The 18th Ordinary Session of the Assembly of Heads of State and Government of the African Union, held in Addis Ababa, Ethiopia in January 2012, adopted a decision to establish a Continental Free Trade Area (CFTA) by an indicative date of 2017.

The Seven Clusters 

The Summit also endorsed the Action Plan on Boosting Intra-Africa Trade (BIAT) which identifies seven clusters: trade policy, trade facilitation, productive capacity, trade related infrastructure, trade finance, trade information, and factor market integration.

The CFTA will bring together fifty-four African countries with a combined population of more than one billion people and a combined gross domestic product of more than US $3.4 trillion.

According to Nick Nesbitt, EABC’s Chairman it is important that the continent having a clear vision to put an end to the fragmentation of the internal market.

“I really applaud everybody who has involved in creating the AfCFTA because their vision is the one of pan-Africanism. It is something our founding founders aspired to. Our thanks to ECA for being at forefront of this conversation and pushing the agenda forward so that the continent becomes a single economic trading bloc”, he said.

Kenneth Bagamuhunda, Director General of Customs and Trade at the East African Community Secretariat, cited the experience of Regional Economic Communities as the building blocks for the AfCFTA. “The AfCFTA should build on what has already been achieved in regional negotiations like the Tripartite Free Trade Area, as well as within our respective regional blocks” he said.

Bagamuhunda highlighted governments need to set a conducive environment for the successful implementation of AfCFTA.

The AfCFTA was signed in March 2018, at a historic meeting of the African Union in Kigali. 52 of 55 African Union member states have so far signed the AfCFTA, 22 countries that have ratified the agreement, which was the minimum number required for it to enter into force.

According to a study by united nations conference on trade and development (UNCTAD), the CFTA must be ambitious in dismantling barriers and reducing costs to intra-African trade and in improving productivity and competitiveness.  Intraregional trade liberalization needs to be contextualized in a broader developmental framework that will provide benefits in terms of realizing Agenda 2063 of the African Union and the 2030 Agenda for Sustainable Development of the United Nations.

“Development-oriented regionalism can contribute to spearheading Africa’s achievement of development goals, the building of resilience to external financial and economic crises and the fostering of inclusive growth. It can have spillover benefits in terms of helping foster peace, security and political stability on the continent. UNCTAD, working in partnership with the African Union Commission, African States and other development partners, is committed to supporting the attainment of these objectives, embodied under the CFTA.” The study reads in part.

UNCTAD also notes that the CFTA may also mitigate costs associated with inaction in building an integrated market. The international trading environment within which Africa participates is changing rapidly with the proliferation of regional trade agreements and, in particular, mega-regional trade agreements, such as the recently concluded Trans-Pacific Partnership, the Transatlantic Trade and Investment Partnership and the Regional Comprehensive Economic Partnership. These arrangements may create spheres of trade centred on partner economies, and African countries face the risk that preferences and trade shares in these markets may erode.

According to an EABC brief on AfCFTA, one of the key steps beyond the ratification of the AfCFTA is to prepare and submit tariff offers, under modalities on goods that will determine tariff liberalization on goods to be undertaken between the AU Member States. Under AfCFTA, African Union Member States have agreed to remove at least 90 percent of tariff on goods imported from other State parties. This implies that under AfCFTA the coverage of products with zero-rated is not intended to be 100 per cent but rather 90 per cent with the remaining 10 per cent tariff classified as sensitive and exemption goods.

Currently is not very clear that 90 percent of tariffs refers to 90 percent of total tariff lines only or a combination of a minimum of 90 percent of total tariff lines and not less than 90 percent of the total value of imports.

In addition, there are uncertainties over the remaining 10 percent tariffs and how these are to be approached in relation to exempted and sensitive products, and how those tariffs are to be liberalized, whether partially or in full, and over what timeframes. Some quarters are proposing that of the remaining 10 percent: 7 percent are classified as sensitive goods with a lengthy phasing-in period, and 3 percent of goods to be exempted altogether. However, it is not known which products will be classified as sensitive and exempt. The most negotiating challenge is to determine which tariff lines will be classified as exempt and sensitive

Also Read: EABC means business when it comes to regional trade

 

Cyclone Kenneth: Mozambique evacuates, Malawi cautions citizens

South African Weather Service says that Cyclone Kenneth could bring intense rains to Mozambique until late Monday evening which could increase the risk of flooding.

At least three people have been confirmed dead in Comoros in the aftermath of Cyclone Kenneth which has made its landfall in Mozambique which is still recovering from aftershocks of Cyclone Idai.

Authorities in the East African island nation said on Thursday that Kenneth caused widespread power outages in the northern part of the main island, Grande Comore.

Other areas that were affected by the cyclone’s winds were the capital Moroni and the island of Anjouan.

Mozambique is recovering slightly over a month after Cyclone Idai flattened the port city of Beira through flooding.

The South African Weather Service says that Cyclone Kenneth could bring intense rains to Mozambique until late Monday evening. This could increase the risk of flooding.

Cyclone Kenneth is expected to bring heavy rains and flooding to north-eastern Mozambique, which was not hit by Cyclone Idai.

Preparedness for Cyclone Kenneth

Mozambique is on high alert and already compulsory evacuations have begun in the northern region of the country where Kenneth is expected to make landfall by early Friday.

The National Directorate of Water Resources has warned that the water basins of Rovuma, Messalo, Montepuëz, Megaruma and Lūrio may rapidly increase and overflow. The directorate has recommended that people living in areas at risk of flooding and landslides to move to safer and elevated areas.

If the water basins overflow, more than 70,000 people will be affected.

Relief Web reports that there is a moderate to high risk of floods and erosion in the cities of Pemba, Nacala Porto and Nacala-A-Velha, possibly affecting 10,000 people.

There are also concerns that the Chipembe dam could be affected.

Tanzania is also on high alert since increased rain is expected in Dar es Salaam, Tanga, Pemba, Lindi and Mtwara regions, the south coast of Tanzania and around Lake Victoria.

Will Cyclone Kenneth hit Kenya?

The Kenya Meteorological Department has dismissed as false claims that the cyclone would batter the Kenyan Coast.

“It is FALSE that cyclone Kenneth will hit the Kenyan Coast. By the laws of physics, Cyclones cannot come this close to the equator. Landfall will be northern Mozambique,” stated the department on Twitter.

The department warned that the country could, however, experience effects of the cyclone in the form of enhanced rainfall over parts of Isiolo, Western Kenya, Samburu and Nairobi.

A prolonged dry period has led to parts of the country suffering from drought but the rains in different parts of the country have brought some hope.

The department says that the rainy season will be shorter than normal adding that the current wet weather in some parts of the country will end in the second week of May.

Cyclone Kenneth in Malawi

In Malawi, the Government has issued a statement saying it expects enhanced rainfall throughout the country and in particular along the lakeshore.

The Department of Climate Change and Metrological Services says that the cyclone will make its landfall by the end of this week.

According to the Director at the department, Jolam Nkhokwe has cautioned those living along the lakeshore and flood-prone areas to follow weather forecasts since the cyclone will bring heavy rains and possible floods in some areas.

Reconstruction in Malawi after Cyclone Idai

Malawi: African Development Bank boosts cyclone response with emergency relief package and measures to combat climate change
The AfDB delegation to Malawi with Malawi Government officials. [Photo/AfDB]
Malawi’s recovery and reconstruction plans in the aftermath of Cyclone Idai have received a boost from the African Development Bank (AfDB).

AfDB is supporting the country with an emergency relief package and measures to combat the effect of climate change in the Southern African region.

The Bank’s Vice President for Corporate Services and Human Resources, Mateus Magala, led a delegation to Lilongwe this week to discuss the institution’s intervention plans with public and civil society officials in Malawi.

Magala met with government officials in Lilongwe, including the Minister of Finance, Economic Planning and Development Goodall E. Gondwe, his Homeland Security counterpart Nicholas Dausi and the Governor of the Reserve Bank of Malawi Dr Dalitso Kabambe.

AfDB has already availed USD250,0000 to Malawi, from its Emergency Relief Fund, for the purchase of emergency food items to avert hunger following the loss of crops damaged by the severe floods.

Assistance for Cyclone Idai survivors

AfDB’s Climate Fund will also release USD150,000 to Malawi to enable authorities to assist communities and internally displaced persons impacted by the cyclone.

The Bank’s long-term plans include designing and developing mechanisms for climate insurance and mitigating climate change.

Close to sixty people have died, and about 1 million persons across 15 districts displaced by the severe floods, mostly in the south of the country, where entire villages were submerged in water.

Private sector activities and operators in the land-locked nation of about 18 million people were also severely impaired by the cyclone.

You can also read AfDB pledging USD25 billion to mitigate climate change effects, Kenyan farmers receiving drought insurance pay-outs and how safe, controlled migration benefits African countries.

How diplomats’ mass exits from Kenya have affected real estate

In filling Nairobi’s many top-end residential estates, the flight of international residents is now being felt in the real estate, a report has revealed.

According to the report released by Hass Consult, economic growth and consumer demand have also affected tax revenue growth and donor funding during the decade-long ‘great recession’ that has followed.

“This steady attrition in numbers was accelerated last year in the new government drive curbing work permits. This triggered a new uptick in international departures, which by the first quarter of 2019 had resulted in significant falls in the sales prices and rents of top-end detached houses, which fell by 4.4 per cent and 4 per cent respectively in the first 12 weeks of the year,” said Sakina Hassanali, Hass Consult’s Head of Development, Consulting and Research.

According to Ms Sakina, the firm foresees some continued downwards pressure in this segment until the international economy improves or Kenya initiates policies to attract renewed growth in international residency.

However, while the top end of the market has been affected by global trends and domestic policies, the other strong mover has come in apartment rentals.

But the other principal strand of this market has been internationals, with Nairobi positioned as one of the four ‘poles’ of Africa, as a centre of diplomatic and commercial activity. This has brought incoming, foreign top management to the African and East African headquarters of European, Asian and American multinationals. It has also brought an abundance of diplomatic staff, and donor-funded staffing, as well as pools of social entrepreneurs and business adventurers.

There has however been a steady downgrading of diplomatic and donor-funded postings since the world financial crisis of 2008, with many western governments running austerity programmes to cover the debt funding for their support of the financial system at that time.

Starting with the top end, it is a fact, and often commented on, that the primary focus for developers over the last two decades, and particularly in the 1990s, and the decade from the year 2000, was at the very top end of the residential market. Thus, today entire suburbs, such as Muthaiga and Karen, Nyari, Runda and Spring Valley, are filled with large detached houses, and lived in by the wealthy.

The report however noted that in filling thousands of large stand-alone houses and villas one has to reflect on the nature and make-up of the market – both for owners and for residents for such homes.

These certainly include the expanding Kenyan elite: CEOs, top politicians, from governors to cabinet secretaries, private secretaries and company directors.

In Kenya’s ever more sophisticated land and property market, the future of all prices is no longer powerful growth. But, as ever, pricing remains a remarkable pointer to unmet demand and shortages and still the clearest guide available to the most strategic development going forwards.

Hass Consult also reported a continuing shift to growth in the Kenyan property sector’s mid-market, as the top-end market adjusts to international pressures and tightening budgets.

Unveiling its property sales and rental price indices for the first quarter of 2019, Hass Consult reported that the strongest price growth in the first 12 weeks of the year was in apartment rents, which rose by 4.9 per cent in just three months, taking the year-on-year growth to 19.6 per cent.

“However, returning to building after the decade of slowdown in apartment pricing would require close attention to location and gaps in the market. “The Kenyan property market has matured, and the only apartments that will now sell and fill quickly are those where developers have properly researched the market and constructed accommodation that fills a proven and unmet need,” said Sakina.

In this, Kenya may also now start to see a new trend in the more widespread conversion of large detached houses into multiple residences. Developer construction over the last 30 years has been dominated by the building of large homes on individual plots, in estates such as Spring Valley, Runda, and Nyari, and areas such as Muthaiga and Karen. However, a substantial proportion of these homes were occupied by international residents. As governments globally have continued to curb foreign spending following the extra debt loading they took on during the financial crisis of 2008, many international and aid-funded operations have been retrenched.

At the same time, changes to Kenya’s work permit regime marked a sharp exodus of internationals in 2018, leading to the vacating of many larger properties. As a result, the prices of detached houses for sale fell by 4.4 per cent in the first quarter of 2019, while rents fell by 1 per cent, as owners and sellers cut prices in an effort to sell or refill. Only in the mid-market of town houses has growth remained solid and inexorable, with sales and rentals having slowed marginally, but remaining robust. In the first quarter of 2019, rental prices on town houses rose by 1.7 per cent, taking year-on-year growth to 11.1 per cent, while sales prices rose by 1.3 per cent, taking year-on-year growth to 7.9 per cent.

“Each quarter we see ever more marked evidence of the relative strength and demand for properties in the middle and lower market, versus the clear slowdown at the top end of the market,” said Sakina.

Also Read: How mergers are shaping up Kenya’s banking industry

Why five Kenyan women in Tech bagged $10,000 dollars

Five Women in tech led companies have bagged Sh1 million ($10,000) each in seed funding courtesy of the Standard Chartered, @iBizAfrica- Strathmore University.

The five teams were selected from a pull of the top 10 teams previously shortlisted and were being incubated at @iBizAfrica-Strathmore University for 6 months where they were offered coaching, mentoring and business management skills to grow their businesses to the next level.

The Exchange sought to find out the reason these five women were picked for the funding.

Among the factors that were considered to select the five winners of this year’s Standard Chartered Women in Technology Incubator 2019 the judges looked at the firms with at least 3 people with demonstrated capacity to execute: clearly defined roles, balanced skill set team lead, business development, product development and marketing. This shows that the firm is in a position to sustain itself in all aspects necessary for growing their portfolios. Firms needed to demonstrate that they were in a position to run their affairs in a well organised manner in a bid to grow.

The judges also set out to look if the winning firms were solving any problem. The firms were expected top therefore demonstrate their relevance by coming in to solve that the society is grappling with. They were also expected to offer solutions that are fit and innovative. The busionesses were expected to prove that they were leveraging on technology and prove that the solution offered was a new technology or a different way of doing things in the market.

Businesses needed to demonstrate that their target market was well described as well as project how big the market opportunity is. Their business models were also looked at. Here, the judges were looking to see if the model is sustainable and scalable.

They were also tasked with a job to prove that in deed their businesses were highly relevant for Kenya in terms of social impact.

The five winning companies for 2019 are:

  1. Abantu (Range) -A startup that focuses on the implementation of unique and innovative technology-based solutions to problems that they are passionate about solving.
  2. Bumpy Maternity Wear – A fashion enterprise established in 2017 in Nairobi, Kenya with an aim of supplying measure to wear clothes for middle class working expectant mums.
  3. Dermi Joy skincare – A local skincare brand that manufactures all natural cosmetics.
  4. Nature’s Bowl enterprise – offers nutritious composite flours that are used to make meals for children and the whole family.
  5. Lugha Ishara community-based organization – A community-based organization with a mission of achieving the transformational development of deaf children through technology-based innovations

The awardees will be supported with extended mentoring and milestone-based disbursement of the winnings for a period of 9 months.

According to the Director @iBizAfrica- Strathmore University Dr. Joseph Sevilla, it was a tough choice selecting the winners from the top 10 pull of very talented young people with brilliant ideas.

“These five teams have shown us dedication, willing to work and just like last year’s winners we are hopeful to see them succeed beyond this program and expand their businesses to grow beyond the Kenyan market.” He said.

Strathmore University Vice Chancellor Designate, DR. Vincent Ogutu congratulated the winning teams and added “To innovate you have to be playful, experimental and be a person who never takes no for an answer. These are the qualities that the top entrepreneurs showcased”.

Speaking at the event Kariuki Ngari, CEO, Standard Chartered Bank Kenya mentioned that in our country, SMEs contribute the biggest share to the country’s Gross Domestic Product (GDP) and represent more than 75% of our working population.

“I would like to appreciate all the Women in Tech participants for being the crème of more than 170 enterprises that applied to this programme. Irrespective of the final outcome, remember that in your own right, you are positively transforming our country’s economy and creating more job opportunities. Just like the Bank, you are striving to be a force for good, promoting sustainable economic and social development in the markets and communities where we operate,” he added.

“We have seen the tremendous transformation the mentoring and injection of seed capital can do for women running start-ups in Kenya. We are hopeful that this year we can show more support to the groups that have applied. We look forward to announcing the shortlisted applicants in the next few weeks,” said Dr. Sevilla.

The Women in Tech is an initiative targeting women led start-ups leveraging on technology as a key drive to innovation in business. Launched in 2017 the program supports female-led entrepreneurial teams by providing them with training, mentorship and seed funding.

Last year finalists Mzurii, Africa Solutions, Nekkta, Maziwa Plus, Avopower, HeriOnline, Zydii, ZOA, Beta Art, Catapult Studios and Bismart each walked away with one million shillings in funding for their businesses and have since shown success and growth in their businesses.

The launch of the programme in Kenya follows a successful rollout of a similar initiative in USA by Standard Chartered.  The Bank first launched the programme to support women in technology in 2014 at the City College of New York where it created the Women Entrepreneurs Resource Center. The US program includes a dedicated workspace, mentorship, coursework and access to an extensive network designed to support entrepreneurs navigating the challenges of starting a business.

Also Read: Stage set for the ‘Women in Tech’ programme

Rwanda receives ALSF’s USD200 million Legal Support

ALSF signed an agreement to provide advisory services support to the government of Rwanda for the negotiation of its deal with Symbion Power.

Rwanda’s Lake Kivu is documented to harbour huge amounts of the poisonous yet useful methane gas estimated at around 55 billion cubic metres.

The naturally occurring methane gas found below the lake is just one of the resources the Rwandan government plans to exploit.

On March 29, 2019, the African Legal Support Facility (ALSF) signed an agreement to provide advisory services support to the government of Rwanda for the negotiation of its deal with Symbion Power.

Powering Rwanda from Lake Kivu

The negotiation with Rwanda is for the development of a USD200 million-dollar energy plant by Lake Kivu.

The energy plant is expected to generate an additional 56 MW of electricity for Rwanda, marking a significant step in Rwanda’s efforts to increase its installed power generation capacity by 291MW to 512MW by 2024.

The plant will extract methane gas from the production area at Lake Kivu and use it to produce electricity.

The Symbion Power project is part of a larger ALSF project providing assistance to Rwanda’s Ministry of Infrastructure (Rwanda MININFRA project), including support for the Nyabarongo II project, which will have a 43.5 MW generation capacity and will increase overall installed capacity by 11.5 per cent.

“The ALSF’s support to Rwanda, through the Rwanda MININFRA project, helps to ensure that Rwandans have access to energy, promoting sustainable development and inclusive growth. The project also ensures that the development occurs on the best possible terms for Rwanda,” said ALSF legal counsel and project task manager, Nchimunya Ndulo.

Rwanda’s USD400 million dangerous methane gas experiment

Seismic and geological surveys on the lake show that the gas could wreak havoc if the pressure of the gases in a lake exceeds the pressure of the water at a given depth.

Lake Kivu’s methane gas has remained untapped for fear over the safety of inhabitants until now.

Already, the US energy firm Contour Global-owned USD200 million KivuWatt is producing 26 MW of electricity for the local grid.

KivuWatt expects to inject another 75 MW in the next phase of its project by deploying nine additional gensets. This will bring the total capacity of electricity to over 100 MW for Rwanda.

Symbion Power is also an American company and the ALSF’s advisory services support will come in handy to ensure that the Rwandese government will not be short-changed as has been happening with many deals negotiated in Africa by international investors.

ALSF and the African Development Bank

The ALSF is an international organisation hosted by the African Development Bank (AfDB) Group.

It is dedicated to funding legal advice and technical assistance to African countries in their negotiation of complex commercial transactions, creditor litigation and other related sovereign transactions.

The ALSF also develops and proposes innovative tools for capacity building and knowledge management.

In March, Uganda ratified the agreement for the establishment of the ALSF becoming the 27th member state of the body.

ALSF is supporting the government to develop the Uganda Refinery Project and the East Africa Crude Oil Pipeline Project.

The ratification of the ALSF Treaty was driven by Uganda’s recognition of the value added by the ALSF’s interventions and by the growing need to further strengthen and improve the country’s legal capacities.

Better negotiated trade deals coming to Africa

In February, ALSF completed a two-day workshop for African lawyers and government negotiators.

The training is aimed at strengthening their capacity to negotiate complex deals involving investments in key economic sectors.

After the training, better-negotiated trade deals could be the way Africa goes cutting out lopsided negotiations which favour foreign investors disadvantaging African governments.

The workshop, co-organized with the African Business Law Firms Association (ABFLA) under the African Legal Support Facility Academy, was held in Accra, Ghana.

AfDB which prides itself as Africa’s premier development finance institution is on the ground in 44 African countries.

It contributes to the economic development and the social progress of its 54 regional member states.

You can also read how safe, controlled migration benefits African countries, Africa becoming world’s largest free trade zone and how the Congo River could power Africa.

MIT, Liquid Telecom partner for Inclusive Innovation Challenge

The IIC will award a total of USD1.6 million this year —including USD250,000 to each of the four winning organisations.

The Massachusetts Institute of Technology’s (MIT) has selected Liquid Telecom as its official partner for the 2019 Inclusive Innovation Challenge (IIC) in Africa.

Since 2016, MIT’s Inclusive Innovation Challenge (IIC) has challenged entrepreneurs around the world to re-invent the way technology innovation is harnessed.

This year the challenge will take place on five continents: Africa, Asia, Europe, Latin America, and the US and Canada.

Recruiting African entrepreneurs and innovators

Liquid Telecom will serve as the IIC’s outreach partner for Africa, where it will play an important role in recruiting African entrepreneurs and innovators to participate in the challenge.

The 2019 IIC has four categories focused on creating solutions to help people prosper in the era of automation.

These are technology access, financial inclusion, skills development and opportunity matching, and income growth and job creation.

Through its Innovation Partnership initiative, Liquid Telecom will be encouraging African based start-ups, innovators and technology companies to take part in the various challenges.

Using digital technology across Africa

The IIC will award a total of USD1.6 million this year —including USD250,000 to each of the four winning organisations.

Liquid Telecom is looking forward to working with MIT on delivering the IIC in Africa as it is aligned with our mission to support innovation, using digital technology, across the continent. As an African company, greater inclusion in both the creation and application of technology is fundamental to Liquid Telecom’s DNA. We are happy to help IIC reach more entrepreneurs and innovators across the continent,” said Liquid Telecom’s Group Chief Technology and Innovation Officer Ben Roberts. “

IIC Executive Producer, Devin Cook sees a “revolution afoot” to create high-tech jobs and skills training that bring people more fully into the digital age. “Our vision is an economy that works for all,” she said.

The future of work

To achieve this, the IIC serves as a catalyst to “accelerate entrepreneurs who are already making our vision a reality.”

In addition, the challenge wants “to drive a solutions-oriented conversation about the future of work.”

Registration is open now and the deadline for submissions is May 9. Regional finalists will be announced 23 July and winners will be recognised at regional celebrations. The challenge will culminate with a Global Grand Prize Gala at MIT on 21 November 2019.

Competition winners and awards

Since 2016, 3,000 organisations have registered for the IIC from more than 100 nations. It has worked with more than 100 Global Outreach Partners, 500 judges, and drawn 3,300 event attendees.

There were 100 winners in last year’s competition, awarded a total of USD3.5 million, which developed solutions ranging from agricultural climate apps for African farmers to training courses for US healthcare workers and coding boot camps in India and the Middle East.

“We believe that inclusive innovation – the use of technology to generate increased economic opportunity for moderate and low-income earners – is imperative with a tight deadline,” said IDE Director, Erik Brynjolfsson.

“The question we should be asking isn’t ‘what is technology going to do to our economy and society,’ but rather, ‘what will we do with technology’?”

This year’s challenge details are available here.

MIT says it is awarding the USD1.6 million to organizations “revolutionizing the future of work”.

Liquid Telecom is also in a partnership to reduce air pollution deaths in Kenya, getting 250,000 refugees to be treated over the internet and in IoT to increase Kenya’s fish production.